Wynn and MGM China Found Jointly Liable in Nine VIP Room Cases

The Court of Final Appeal in Macau has decided that MGM China and Wynn Macau share liability in nine cases related to lost deposits at VIP rooms. The nine cases were recorded at Dore Entertainment Co LTD’s VIP room and the former VIP room belonging to Sun City Gaming Promotions Co LTD located at an MGM property.

Dore Entertainment and Sun City Rejected Plaintiffs’ Request to Cash Out

The court’s decision regards nine cases filed during the first two months of the current year. The cases referred to deposits in junket operators that had business ties with gaming concessions. Out of the nine cases, eight involved Dore Entertainment and concessionaire Wynn Resorts, with one of the cases involving Sun City Game Promotion with MGM Grand Paradise as a concessionaire.

MGM Grand Paradise together with Wynn Resorts represents official entities with concession licenses in relation to MGM China and Wynn Macau. A number of lawsuits were filed against Wynn Macau, the venue that is still confronted with the low foot traffic and missing VIPs caused by the ongoing lockdown. The lawsuits were filed by investors and other individuals who had accounts opened at Dore Entertainment. Their claims were that Dore had denied their fund cashout requests from their accounts after an ex-staff member ran away with close to HK$700 million ($89.1 million) seven years ago, in 2015. The respective plaintiffs claimed to have deposited between HK$1 million ($127,000) and HK$6 million ($764,000).

In each of the nine cases, it was alleged that Sun City and Dore Entertainment refused to grant the plaintiff’s withdrawals after making deposits with them in the previous months. Originally, the nine were registered with the Court of First Instance. The Court of Second Instance found Wynn Macau and MGM to be jointly liable. All nine cases were then appealed to the Court of Final Appeal. The court ruled upon the concessionaires as severely liable for the debts that had been incurred by the aforementioned gaming promoters that were operating within their casinos at the indicated times. A law from 2002 regarding activities that promote gambling mentioned the joint liability of concessionaires in relation to third parties for all the activities carried out by their gaming promoters.

Last November, Macau’s Court of Final Appeal upheld the decision according to which Wynn Resorts Macau was jointly liable with junket partner Dore Entertainment for a debt of around $748,000 to a VIP member.

Wynn Macau Does Not Expect Any Material Exposure

Wynn Macau’s chief executive officer Craig Billings declared the group was not waiting for any sort of “material exposure” from the other lawsuits tied to the Dore Entertainment case. Plus, amendments proposed in relation to junket activities and Macau gaming laws evaluated by the Legislative Assembly clarify the fact that concessionaires are liable not only for their promotional operations, but also for employees, administrative organs, employees, or collaborators of gaming promoters generated by promotional operations taking place in casinos.

The same local bill also mentions criminal penalties that should be imposed on junkets who accept deposits from members of the public. The law mentions offenders being prone to spend five years in prison for their crimes. At the same time, a deposit made with a casino in Macau using a VIP host or junket is considered legal as long as the deposited money will only be used for wagering purposes.

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