Sheldon Adelson Has Testified in a Number of Court Cases in Recent Years
Sheldon Adelson was called as a witness Monday in a lawsuit filed against Las Vegas Sands Corp. by former Sands China CEO Steve Jacobs. The lawsuit has continued since 2010, when Jacobs filed suit claiming that he was wrongfully fired from LVS Corp. Mr. Jacobs says he was asked to engage in illegal activities. When he refused, so Jacobs claims, the gaming company fired him.
Steve Jacobs claims he was told to gather information on Macau officials which might have been used to harm their reputations, if that information fell into the wrong hands. The suit by Jacobs also claims that Sheldon Adelson had approved a strategy to condone prostitution in the Las Vegas Sands casinos in Macau: the Venetian Macau and the Sands Macau.
Adelson Says Jacobs Initiated Information Gathering
For his part, Sheldon Adelson has denied all such claims. While he admits that compromising information on Macau officials was gathered, that information was collected by Jacobs himself. In 2013, Adelson denied knowing anything about that information until it became part of the lawsuit.
Does Nevada Have Jurisdiction
Monday’s hearing is to determine whether Sands China, which operates in Macau, is listed on the Hong Kong Stock Exchange, and is registered on the Cayman Islands, can be sued in the United States. Sands China has argued that Steve Jacobs should not be able to proceed with a Nevada lawsuit, because the company does not operate on the territory of the state. Jacobs argues that the parent company operates in Nevada, so a lawsuit involving that parent company’s firing of him should be allowed.
Furthermore, Jacobs says that the evidence presented is going to reveal that the Sheldon Adelson and Las Vegas Sands Corp controlled the Sands China operations in Macau from the offices in Las Vegas. He says that the documents are going to reveal that Sheldon Adelson ordered the investigations of Macau officials himself.
Adelson’s Reasons for Jacob’s Termination
Mr. Adelson, who continues to serve as the Chairman of Las Vegas Sands, says that Steven Jacobs was terminated from his role at the global gaming company for “unauthorized activities”. He also stated that Jacobs had violation the company’s working policy.
The judge in the case approved the use of a report written by a Hong Kong analyst which provided possible corroborating evidence for Jacobs. The report was compiled after the analyst was asked to look for connections between Sands China officials and the Chinese Triads, the local organize crime syndicates.
Serious Political and Legal Issues
Steven Jacobs told the court that the report would bring to light “serious political and legal” issues, including the Sands connection to Chinese organized crime. In retaliation, Sheldon Adelson filed a Florida defamation lawsuit against Jacobs, who lives in Florida these days. The case was dismissed in 2014.
Since that time, Sands China filed a motion to have Nevada District Court Judge Elizabeth Gonzales dismissed from the case. LVS says Judge Gonzales has a distaste for the casino gaming company and this has created a potential bias in her decisions. That lawsuit was dismissed in the past few weeks. That motion was filed when Judge Gonzales ruled that Las Vegas Sands would not be allowed to call witnesses at the latest hearing on Monday.
Macau’s Gaming Industry
China has been the chief source of revenue for the Las Vegas Sands Corporation in its rise to preeminence in the global gaming industry. Before Sheldon Adelson’s company built the Venetian Macao in the early years of the 21st century, the Sands Corporation was considered a second-tier Las Vegas Strip gaming company. Ten years after the Venetian Macau opened in 2004, the Las Vegas Sands Corporation was the largest money-producer among all casino companies in the world. Sheldon Adelson was the 8th-richest person in the world with an estimated $39 billion at one point. Only a handful of people, such as Bill Gates, Warren Buffet, and Carlos Slim, had more money.
Macau’s gaming operations grew along with Adelson’s bank account. From a gaming backwater in 2004, Macau eclipsed Las Vegas. In 2013, Macau generated 7 times more money than all of the Las Vegas casinos combined. Thus, Steve Jacobs was not only a divisional or regional head for LVS; in many ways, he was the most important executive in the company, outside of Sheldon Adelson himself.
Now that China’s leadership has soured on the Macau gaming industry, the Venetian Macau and Sands Macau have a more uncertain future. One thing is for certain: Steve Jacobs’ lawsuit makes the city look as bad as it makes the Las Vegas Sands Corp look. That cannot be good for the city’s casino industry in an era when President Xi Jinping has publicly stated the city must move away from a gambling-dominated economy.
