GGRAsia – Fox park defendants reply and counter claim vs Genting

Fox park defendants reply and counter claim vs Genting

Jan 24, 2019 Newsdesk Latest News, Rest of Asia, Top of the deck

Casino firm Genting Malaysia Bhd said in a Wednesday filing to Bursa Malaysia that it had received a reply and a counter claim for US$46.4 million from what it termed “the defendants” it had sued for more than US$1 billion regarding a delayed and disputed Fox-branded theme park at Genting’s Resorts World Genting casino resort near Kuala Lumpur in Malaysia.

It had previously been reported that Genting Malaysia was suing Fox Entertainment Group LLC and some related companies, as well as The Walt Disney Co, for allegedly backing out of a contract arising from a plan to build a theme park bearing the 21st Century Fox brand.

Genting Malaysia said in its Wednesday filing that as well as answering the casino firm’s original complaint, filed in the United States in November, “Fox filed a counter claim against Genting Malaysia alleging breach of contract and breach of the implied covenant of good faith and fair dealing”.

The Genting Malaysia filing added “Fox” was claiming “a monetary sum of approximately US$46.4 million [MYR191.7 million] … in respect of annual licence fees, guarantee amounts/royalties and travel reimbursements” relating to a June 2013 memorandum of agreement, as well as consequential damages, reasonable costs and other relief.

It was separately reported in a financial media outlet that the parties making the counter claim were Fox Entertainment Group LLC, Twentieth Century Fox Film Corp and FoxNext LLC.

“Genting Malaysia is in the process of reviewing the above with its legal counsels and intends to file a timely response,” said the firm in Wednesday’s filing.

Samuel Yin Shao Yang, an analyst at Maybank IB Research, a part of Maybank Investment Bank Bhd, said in a Thursday note: “Fox’s US$46.4 million claim is not new and accounts for fewer than 1 percent of Genting Malaysia’s market capitalisation.”

Mr Yin added, referring to the possibility of Genting Malaysia going ahead with an unbranded park: “Curiously, neither Fox nor Disney sought to preclude the opening of Resort’s World Genting’s outdoor theme park. This implies to us that Genting Malaysia can proceed to operate the outdoor theme park on its own.”

Genting Malaysia said in December it still planned to open the theme park but that the opening date is yet to be confirmed. The clarification came after company chairman and chief executive Lim Kok Thay was quoted saying that the non-gaming facility would be “ready” early this year.

Meanwhile Resorts World Las Vegas LLC, a United States-based unit of Genting Malaysia’s parent Genting Bhd, has said it will “strenuously defend” a civil case brought against it by Wynn Resorts Ltd. The latter alleges Genting copied Wynn’s architectural look for its under-construction property Resorts World Las Vegas.