By Kate O’Keeffe
Of DOW JONES NEWSWIRES
HONG KONG (Dow Jones)–The Nevada Supreme Court threw out a lower court’s decision to award a Hong Kong businessman US$58.6 million for allegedly helping Las Vegas Sands Corp. (LVS) win a gambling license in Macau, ruling that the district court’s errors warranted a new trial.
In 2008, a jury decided Richard Suen should be paid for helping arrange meetings in Beijing between company executives and Chinese officials, which he said led to the gambling giant’s 2002 receipt of a coveted license to operate casinos in Macau. The Chinese territory, on track this year to rake in four times the gambling revenue of the Las Vegas Strip, is now home to three casinos run by Las Vegas Sands unit Sands China Ltd. (1928.HK).
Las Vegas Sands spokesman Ron Reese said: “The company hasn’t yet had an opportunity to thoroughly review the details but obviously we’re pleased with the result.”
Suen couldn’t immediately be reached for comment.
Legal experts say though the ruling was in favor of the casino operator, the prospect of a new trial isn’t great news for the company because of the potential bad publicity and because one of its key witnesses, former Las Vegas Sands President William Weidner, is unlikely to be cooperative. Weidner resigned in March 2009 after almost 14 years at the company amid heated disputes with Las Vegas Sands Chairman Sheldon Adelson.
Reese said: “The company will continue to defend its contention that Suen had nothing to do with the license.”
The state’s supreme court reversed the lower court’s earlier decision in an order filed Wednesday, ruling that a district judge shouldn’t have admitted a hearsay statement during the trial.
Suen tried to prove to the jury that the meetings he had arranged in Beijing influenced the license tender process, but without the hearsay statement, “the jury may have found there was no connection…,” the judgement said.
The high court also concluded that the district court had erred in refusing to instruct the jury on presumptions of governmental regularity, as one of Las Vegas Sands’s defense arguments revolved around the presumption that officials in mainland China had no involvement with Macau’s licensing procedure and, therefore, that the meetings Suen had set up with Chinese officials hadn’t led to the company securing the license.
Suen had argued that Beijing was involved even though Macau’s basic law entitles it to independent executive, legislative and judicial powers, the order said.
In June 2009, Las Vegas Sands paid US$42.5 million to settle a dispute with three other businessmen who had claimed they helped the company secure its Macau gambling licence. The settlement came just before a Nevada jury was set to start a public hearing on the case.
The company is also facing a wrongful termination suit from former Sands China Chief Executive Steve Jacobs, who alleges he was fired after refusing to carry out Adelson’s illegal demands.
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