Billionaire Sheldon Adelson’s Las Vegas Sands Corp. (LVS:US) must pay $70 million to a Hong Kong businessman for his help in obtaining a Macau casino license more than a decade ago, a Nevada jury said.
The jury in Las Vegas yesterday returned a verdict in the second trial over Richard Suen’s claim that meetings he helped arrange for Adelson with Chinese government officials in Beijing were instrumental to Sands getting permission to operate casinos in the former Portuguese colony in 2002. The Nevada Supreme Court in 2010 reversed a $43.8 million jury award for Suen.
“We believe there are compelling and sufficient grounds on which to appeal this verdict and we will do so aggressively,” Ron Reese, a spokesman for the casino company, said in an e-mailed statement.
Adelson, 79, claimed during his trial testimony that Suen, a friend of his younger brother Lenny Adelson, contributed nothing to the company’s being selected by the Macau government. Lawyers for Sands argued that the Macau government made its decisions independently from the central government in Beijing, which is legally prohibited from intervening in Macau’s internal affairs.
Las Vegas Sands fell as much as 1.3 percent after the jury ruled against it. That loss was erased yesterday after the award was reported to be $70 million.
Suen, 60, testified during the trial that he first alerted Sheldon Adelson to the possibility in 2000 that the Macau government would end the gambling monopoly casino mogul Stanley Ho had in the enclave since 1962. Suen claimed that the goodwill created with Chinese officials through the meetings he helped arrange in Beijing led the Macau government to select Sands.
“I got justice from the people of Clark County,” Suen said after the verdict was read, referring to the court district that includes Las Vegas. “I had faith in the justice system, and it turned out to be absolutely correct.”
His lawyer, John O’Malley, said he thinks the verdict will withstand an appeal.
“A question for Mr. Adelson: When are you going to pay that?” O’Malley said.
Sands was part of a Galaxy Entertainment Group Ltd. (27) bid that won one of the three Macau concessions in 2002. The company was given a subconcession later that year to build and operate its own casinos.
Las Vegas Sands gets about 58 percent of its annual revenue from its Macau business. Sands China Ltd. (1928), the company’s Hong Kong-listed unit, on May 2 reported first-quarter net income of $452.9 million, a 63 percent increase from a year earlier, as it drew a record number of visitors.
Suen had sought $328 million in damages based on the 2 percent of Sands’s net income from its Macau casinos he said he was promised, after the 2001 meetings with Chinese officials in Beijing, if the company received a gaming license.
Suen argued at the trial that the meetings with Chinese Vice Premier Qian Qichen and Beijing Mayor Liu Qi were crucial to Sands’s success in obtaining a license. It helped that during those meetings, Adelson reassured Chinese officials they didn’t have to worry that the U.S. House of Representatives would derail Beijing’s bid to host the 2008 Olympics, Suen said.
Adelson, during his three days on the witness stand, said he had called then-U.S. Representative Tom DeLay, a friend, from his mobile phone when he met the Beijing mayor to find out the status of a pending House resolution that would have encouraged the U.S. Olympic Committee to vote against Beijing’s bid to host the 2008 Olympics.
Adelson said he learned from DeLay, a Texas Republican who was one of the bill’s sponsors, that the resolution probably wouldn’t make it to the floor of the House in time for the vote later that month of the Olympic Committee.
The 2010 verdict in favor of Suen amounted to $58.7 million with prejudgment interest. The Nevada Supreme Court reversed it after finding that the judge who presided over the trial had incorrectly allowed so-called hearsay evidence linking the meetings in Beijing with the award of the gaming license.
The case is Suen v. Las Vegas Sands Corp., 04A493744, Nevada District Court, Clark County (Las Vegas).
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