An arbitration tribunal in Singapore has ordered Asian casino investor Bloomberry Resorts Corp to pay US$296 million to Global Gaming Philippines LLC, a unit of U.S.-based Global Gaming Asset Management LLC (GGAM), which in turn has links to former casino executive William Weidner.
Bloomberry Resorts said in a filing on Monday that the payment ordered by the arbitration tribunal was related to the termination of a management services agreement between subsidiaries Sureste Properties Inc and Bloomberry Resorts & Hotels Inc, and Global Gaming Philippines. The deal was related with Solaire Resort and Casino (pictured in a file photo), a property that opened in the Philippine capital Manila in March 2013.
The parties had struck a casino management services contract in 2011 that included veteran industry figure Mr Weidner and some associates. Mr Weidner – a former president and chief operating officer of U.S.-based casino group Las Vegas Sands Corp – and his associates were paid US$175,000 a month for technical assistance on all aspects of planning, design, layout and construction of the project, as well as for services related to recruitment, selection and hiring of employees for Solaire.
According to the Bloomberry group’s 2015 annual report, in September 2013, Bloomberry Resorts and Hotels and Sureste Properties terminated the agreement with Global Gaming Philippines, alleging “material breach” and “failure of discussions”. Global Gaming Philippines claimed the agreement had been wrongfully terminated.
According to a 2016 decision by the same Singapore-based arbitration tribunal, Bloomberry Resorts was “not justified” in terminating the casino management services with Global Gaming Philippines.
The tribunal – which the Bloomberry group’s 2015 annual report said was a three-member body operating under the arbitration rules of the United Nations Commission on International Trade Law, and using Philippine law as the governing law – made what was termed by Bloomberry Resorts at the time as a “partial award on liability” against the Philippine group.
In its Monday filing, Bloomberry Resorts said it believed the latest decision by the arbitration tribunal was “fundamentally flawed in numerous respects”. The firm added that it was “considering its options in Singapore and elsewhere with respect to the final award on remedies” decided by the arbitration tribunal.
Bloomberry Resorts noted that, according to its legal advisors, “the arbitration award is not self-executing and must be confirmed by a court for it to be enforceable and to have the legal effect of a judgment”. The firm added that, according to such legal advice, the decision of the arbitration tribunal “may be enforced in the Philippines only through an order of a Philippine court of proper jurisdiction, after appropriate proceedings taking into account applicable Philippine law and public policy.”
The US$296-million award to Global Gaming Philippines ordered by the arbitration tribunal was, according to Bloomberry Resorts, “less than half of the damages sought by claimants”. It included US$85.2 million as damages for lost management fees to Global Gaming Philippines, and PHP10.17 billion (US$195.68 million) for the 921.2 million shares Global Gaming Philippines currently holds in Bloomberry Resorts.
“If [Bloomberry Resorts] do[es] not pay for the shares, Global Gaming Philippines may sell the shares in the market and [Bloomberry Resorts is] directed to take all steps necessary to facilitate this sale. [Bloomberry Resorts] will be liable for the difference in the selling price if it is less than the awarded price,” the casino operator stated in its Monday filing, quoting the decision by the arbitration tribunal.
The award also included US$15.4 million in costs, and pre-termination fees and expenses to Global Gaming Philippines.
In related matters, Bloomberry Resorts said in its Monday filing it had filed a petition with Singapore courts to vacate the prior arbitration decision on the case regarding the partial award on liability, alleging it “was procured by fraud and is in violation of public policy”.
The firm added: “This petition arose from the fraudulent concealment and misrepresentations by Global Gaming Philippines, which are apparent in light of the outcome of two U.S. federal investigations regarding violations of the Foreign Corrupt Practices Act involving two of Global Gaming Philippines’s four executives during their time at Las Vegas Sands”. Bloomberry Resorts did not identify the two people reportedly being investigated by the U.S. authorities.
“If Singapore courts decide that petition in favour of [Bloomberry Resorts], the partial award on liability, which is a predicate for the final award on remedies, will be vacated,” the firm said. Bloomberry Resorts stated that it was currently not able to predict when the Singapore courts would issue a decision on its petition.
Nov 14, 2019Casino equipment brand Aristocrat used the MGS Entertainment Show 2019 to give an Asia trade exhibition debut to its just-released MarsX slot machine cabinet (pictured). The hardware took centre...
Nov 06, 2019A senior official of Japan’s Nagasaki prefecture has...
Jul 15, 2019Hong Kong-listed casino operator and developer NagaCorp Ltd...
Jul 12, 2019Asia-based casino logistics provider TKHS Group has plans...
Jul 04, 2019Japan’s Nagasaki prefecture and Sasebo city aspire to...
Jun 12, 2019Hong Kong-listed casino services firm Macau Legend...
Macau government's forecast for casino GGR in 2020