LAS VEGAS (CN) – A former Sands China CEO’s lawsuit against Sheldon Adelson got under way Monday, with Adelson’s attorneys objecting so often a state judge threatened to hold them in contempt.
Steven C. Jacobs sued Adelson and his Sands companies 4½ years ago, claiming the casino billionaire wrongfully fired him for objecting to Adelson’s “outrageous” demands in Macau.
Among them: that Jacobs conduct “secret investigations” into the “business and financial affairs of high-ranking members of the Macau government,” to find damaging information to create “leverage” to stop regulatory actions that might harm China Sands’ business.
At a contentious evidentiary hearing Monday, Adelson’s attorney called Jacobs an “extortionist,” and Jacobs’ attorney retorted by accusing Adelson’s lawyer of trying to hold a Star Chamber hearing.
Jacobs sued Adelson, Las Vegas Sands and Sands China in Clark County Court in October 2010. Adelson claims that Nevada is not the proper jurisdiction.
Retired Las Vegas Sands COO Michael Leven on Monday answered questions aimed at proving Nevada is the proper jurisdiction, but Sands attorney J. Randall Jones and other Sands attorneys repeatedly objected.
They objected so often that judge Elizabeth Gonzalez threatened them with contempt.
“If you object every half-question, this hearing will take a month to complete,” Gonzalez said.
Jacobs’ attorney Todd Bice continued asking questions designed to establish Nevada as the proper jurisdiction, saying that Adelson and for a time Leven oversaw operations at Sands China’s Macau operation from Las Vegas.
Leven testified that after Jacobs was fired as CEO of Sands China in July 2010, Leven served as interim CEO of Sands China while continuing his position as COO of Las Vegas Sands and continued working in Las Vegas.
Leven told Bice he was paid by Las Vegas Sands and did not draw separate checks or earn additional pay as interim CEO of Sands China.
But Bice produced copies of 2010 SEC filings by Las Vegas Sands that report Jacobs’ salary as CEO of Sands China.
Jones unsuccessfully objected to introduction of the documents.
Before Leven took the stand, Jones argued against inclusion of many items listed as evidence by Bice, including emails. Leven said such documents are private and designed to embarrass Las Vegas Sands and others by making them public, and that the matter of jurisdiction remains unresolved.
“You can’t unring that bell” if the court determines Nevada does not have jurisdiction and the embarrassing information is made public, Jones argued.
“We believe Mr. Jacobs is an extortionist,” Jones said. “This is a matter of privacy.”
Bice countered: “We don’t have secret chambers in the United States,” and “simply being embarrassed over what you are doing in another country” isn’t grounds for sealing evidence.
Bick intends to call Adelson as a witness at trial.
In his complaint, Jacobs says he was fired because he objected to Adelson’s demands that he “use improper ‘leverage’ against senior government officials of Macau” and wanted Jacobs to threaten to cease doing business with Chinese banks unless the banks agreed to “influence” newly elected Macau officials to obtain favorable labor quotas and gambling table limits.
In addition to the “secret investigations” of Chinese officials, Jacobs said, Adelson wanted him to withhold “truthful and material information” from Sands China’s board of directors, including information on “junkets and triads, government investigations” and retaining a Macau attorney who Jacobs said “posed serious risks under the criminal provisions” of the U.S. Foreign Corrupt Practices Act.
Jacobs seeks compensatory and punitive damages for breach of contract and wrongful firing.
Las Vegas Sands spokesman Ron Reese declined to comment.
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