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Sean Whaley

Nevada Supreme Court rules against Las Vegas Sands

11 August 2014

CARSON CITY –- The Nevada Supreme Court on Thursday upheld a lower court ruling requiring Las Vegas Sands to turn over unredacted documents in the company's ongoing legal dispute with Steve Jacobs, who served as head of the company's Macau operations until he was let go in 2010.

Attorneys for the Sands argued that turning over the documents without redacting personal information would violate Macau law.

But in the opinion written by Chief Justice Mark Gibbons, the court rejected the Sands petition seeking to overturn the order issued by Clark County District Judge Elizabeth Gonzalez. Gibbons was joined by three other justices. Justice Michael Cherry concurred in the result. Two other justices did not participate in the decision.

"In this opinion, we consider whether a Nevada district court may properly issue a discovery order that compels a litigant to violate a foreign international privacy statute," Gibbons wrote. "We conclude that the mere existence of an applicable foreign international privacy statute does not itself preclude Nevada district courts from ordering foreign parties to comply with Nevada discovery rules."

Gonzalez issued an order in March 2013 finding that Sands China engaged in sanctionable conduct by redacting personal data from documents provided in the case. The company said the redactions were done to comply with the privacy laws of Macau.

In seeking to overturn the order, attorneys for the Sands also said there was no showing that the redacted data had any relevance to the dispute with Jacobs.

Sands attorneys also said that more than 165,000 unredacted documents had been turned over and that the company has spent $4 million in attempting to comply with the request for information by Jacobs. Jacobs is suing the Sands for breach of employment.

The court noted in its opinion that Gonzalez has not yet had a hearing on whether sanctions are warranted against the Sands for failing to comply with her order and that there was no cause for emergency intervention in the case.

In a second case decided by the court related to the wrongful termination dispute, the court agreed to halt the return of 11,000 documents to Jacobs that the Sands Corp. attorneys said are privileged.

In the opinion also written by Gibbons, the court noted that Gonzalez has yet to determine whether the Sands' "assertions of privilege are proper."

The opinion overturned an order by Gonzalez requiring the documents to be returned to Jacobs.

The rulings are just the latest in the case involving the Las Vegas Sands and its CEO, Sheldon Adelson. In May the Nevada Supreme Court revived a defamation lawsuit brought against Adelson by Jacobs.

In the wrongful termination case, Jacobs has alleged that Adelson wanted him to, among other demands, perform secret investigations regarding the business and financial affairs of various high-ranking members of the Macau government and "refrain from disclosing truthful and material information to the board of directors of Sands China."