Las Vegas Sands Wins Latest Round in Macau Billion-Dollar Lawsuit Saga

This legal battle, which has persisted for more than two decades, centers around a multi-billion-dollar lawsuit claiming that LVS breached agreements with AAEC during the early stages of Macau's gaming market liberalization. The crux of the case revolves around whether LVS violated agreements with Hao's firm, which allegedly harmed AAEC's chances of securing a gaming concession in Macau.

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AAEC has claimed that LVS' actions, including a potential breach of copyright law, derailed its prospects of obtaining the lucrative concession. LVS, through its Macau subsidiary Sands China Ltd, is currently in the second year of a new 10-year concession that began in January 2023, following the renewal of its rights to operate in the region under the revised Macau gaming law.

The recent ruling by the Court of Second Instance represents a continuation of the legal setbacks AAEC has faced in its pursuit of compensation. However, AAEC still retains the option of appealing to Macau's Court of Final Appeal, the highest judicial body in the jurisdiction.

Lawyer Jorge Menezes, representing AAEC, indicated that the company is likely to pursue further legal action, signaling that the company remains committed to its efforts to challenge LVS. Menezes declined to provide specific comments on the substance of the court's latest decision but expressed confidence that AAEC would "take the fight to the very end."

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Over 20 years in the Making

The original case, which was brought to Macau's Court of First Instance, culminated in an April 2022 judgment in favor of LVS. The lower court had ruled that AAEC's claims were exaggerated and that the plaintiff had engaged in litigation in bad faith. The court suggested that AAEC had "seriously overestimated the amount of compensation" it was seeking in relation to the damages claimed during the legal proceedings.

The roots of the legal dispute trace back to the early 2000s when Macau transitioned from a monopoly gaming market to a more competitive system. At the time, units of LVS had partnered with AAEC in hopes of securing a gaming concession in the newly liberalized market. However, LVS later switched alliances, teaming up with Hong Kong entrepreneur Lui Che Woo through his entity Galaxy Casino SA. This partnership proved successful, with Galaxy securing one of the three initial concessions issued by the Macau government.

In December 2002, an amendment to Galaxy Casino's concession contract allowed a subsidiary of LVS to receive a sub-concession from the original Galaxy license. This sub-concession effectively granted LVS the right to operate independently in Macau, establishing a separate foothold in the region's lucrative casino industry. The Galaxy concession was later transferred to Galaxy Entertainment Group Ltd, and LVS went on to develop some of Macau's most iconic integrated resorts, including The Venetian Macao and Sands Cotai Central.

The legal battle between AAEC and LVS has stretched on for over 20 years, and the stakes remain high. AAEC continues to argue that it was wrongfully denied the opportunity to secure a gaming concession in Macau due to the actions of LVS. The case could now potentially head to Macau's Court of Final Appeal.

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