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Tim O'Reiley
 

Stakes higher as retrial in claim against Las Vegas Sands under way

4 April 2013

LAS VEGAS -- The story remains the same, but the stakes have risen by nearly a quarter of a billion dollars in the retrial of former consultant Richard Suen’s claim against Las Vegas Sands Corp.

During opening statements Wednesday, Suen attorney John O’Malley told jurors that Suen played a critical role in helping Sands secure its lucrative gaming license in Macau a decade ago. According to the terms of the deal O’Malley said was in place, Sands promised Suen a $5 million cash fee plus 2 percent of the net profits generated in Macau, estimated at $16.1 billion over the 20-year term of the license.

That would net Suen $328 million compared with the $96.2 million he requested during the 2008 trial. Suen won a $43.8 million verdict after a 29-day jury trial, but it was overturned by the Nevada Supreme Court in 2010.

Sands attorney Richard Sauber scoffed at the idea that Suen had done anything more than arrange a 40-minute meeting with several Chinese government officials that contributed nothing to winning the license. For that, Sauber said, Suen wanted to be paid $8 million a minute when he should get nothing.

The trial will quickly kick into high gear today, with the scheduled appearance of Sands Chairman and CEO Sheldon Adelson on the witness stand.

Moments before the trial started, the case crossed paths with another case that has not yet come to trial, as Suen warmly greeted former Sands China President Steven Jacobs for the first time. Jacobs, fired from the post after a few months, has filed a wrongful termination suit against the company. He attended the session Wednesday as an observer.

Framing the case in basic terms, O’Malley told the jurors: “This is a case about not paying your debts when you have the means to do so. Las Vegas Sands should now pay a debt that has been owed for many, many years.”

O’Malley’s story traced back to mid-2000, about one year after Macau returned to Chinese control following five centuries as a Portuguese colony. At that point, O’Malley said, Suen saw an opportunity to open new casinos beyond the monopoly then in place and proposed using the connections he said he had with top Chinese officials to gain a foothold for Sands.

Suen gained an audience with Adelson through a business venture he started several years earlier with Leonard Adelson, Sheldon’s brother, to import hotel supplies such as small soaps and lotion bottles.

As a result, Suen claims that he not only inspired Sands to pursue Macau, where it now has four properties, but guided the company past the shoals of the Chinese government process. Suen succeeded, O’Malley said, because of the relationships — encapsulated in the Chinese word “guanxi” — he had built up during his career as a Hong Kong businessman.

In addition, Suen took credit for steering Sands away from taking on a politically disastrous partner based in Taiwan and ultimately getting the gaming concession approved in 2002.

Sauber countered repeatedly that Suen had done nothing but arrange the one meeting in Beijing. Even then, he added, the Chinese government had set up a special office to arrange such sessions for a long line of potential foreign investors in a variety of industries.

Sheldon Adelson and former Sands President William Weidner had decided on their own to pursue Macau and laid much of the groundwork on their own, Sauber said.

The Macau government set up a special panel to solicit and review casino proposals, awarding one of three to Galaxy Casino Co. Ltd., Sands’s partner in February 2002. The official notice that included the Galaxy name, not Sands, showed that Suen did not deliver on his promise of landing Sands the license, Sauber said.

In preparing the voluminous application, “[Suen] did not edit anything. He did not draft anything. He was not part of the [Sands] team,” Sauber said.