On November 24th, a previous ruling of the Court of Second Instance (TSI) that the Macau business of the US gambling giant Wynn Resorts was jointly liable for the repayment of a VIP player’s debt worth HK$6 million, along with the junket operator Dore Entertainment Co. Ltd, was officially upheld by Macau’s Court of Final Appeal (TUI).
Now, the Court of Final Appeal ruled against the US casino and gambling operator’s appeal of the TSI decision. It upheld the Court of Second Instance’s ruling that found Wynn Resorts jointly responsible for the refund of a high-roller gambler’s deposits logged at Dore Entertainment.
The legal action dates back to 2015 when Dore Entertainment, a junket company that operated out of Wynn Macau, fall victim to an internal theft initiated by Mimi Chow Ioc Mei, a casino cage manager, who left the company after stealing HK$700 million. In the following year, Ms. Chow was ordered by the court to repay MOP103 million to Dore Entertainment.
At the time when the incident occurred, a few people reported that they had invested money in the junket operator after being promised to get higher returns than the ones offered by regulated lenders. However, as a result of the alleged incident, they had lost their investments.
According to court documents, the claims of four of the involved customers totaled HK$64 million, but three of them failed to present the court with the documentation that was needed to prove their claims. The fourth plaintiff produced a receipt proving he had made a HK$6-million deposit with the cage manager.
Ruling that Wynn Macau is Jointly Liable for Junket’s VIP Debt Repayment Found Crucial for Casino Operators
After taking the issue into consideration, the Court of First Instance (TJB) ruled that it was the junket operator who bore the responsibility for the debt repayment, plus interest on the deposit and court costs because the deposit contract was made between the customer and Dore Entertainment.
However, in 2018, the Court of Second Instance ruled that the Macau-based property of Wynn Resorts was jointly liable for the refund. Now, the special administrative region’s Court of Final Appeal upheld the decision.
The Final Appeal Court’s ruling is considered a landmark decision for the casino industry in Macau, as it would be crucial when it comes to determining the responsibility held by gambling concessionaires for the services offered by so-called junket operators.
As shared by Paulo Martins Chan, former director of the Gaming Inspection and Coordination Bureau, in an interview that took place in June 2020, if the casino and gambling company was found to be responsible, they would become warier regarding the junkets. Furthermore, Mr. Chan believed that gambling operators’ relationship with junkets would also change as a result of such a court’s ruling.
In an article published in Gaming Law Review in March 2021, António Lobo Vilela, a gaming law expert who previously served as an advisor to the Secretary for Economy and Finance, explained that the decision would have an extremely important effect on both the gambling industry and the junket operators sector. According to him at the time, a decision of the top court that would uphold the liability of the gambling company would have an unprecedented and materially adverse effect on the casino operators’ businesses in Macau.