Big Trouble in Little China; The thieving nun

Carrying a 20-year-long grudge, businessman Marshall Hao is suing Las Vegas Sands for $12 billion, claiming it wronged him when it jilted his Asian American Entertainment Corp. in favor of a (short-lived) partnership with Galaxy Entertainment to get into Macao. Although he’s not alleging such, political reasons may have been involved. Hao is a citizen of Taiwan, while Galaxy is firmly China-rooted. He wants 70% of Sands’ operating profits from the 2004-2022 period. The trial will be gaveled into session on June 16. Alas, we no longer have the addled, combative testimony of Sheldon Adelson to anticipate. In the past Sands has stated, “Using a different lawyer every time, AAEC has repeatedly filed lawsuits trying to take credit for that which they didn’t do.” However, the company has a history of promiscuity with regards to its Macanese partners. A $70 million court award to Richard Suen for an unpaid “success fee” still hangs over Sands’ head and the company quietly settled with three local Chinese businessmen for a similar favor.

The timing of the trial is unfortunate for Sands, with reexamination of casino concessions due next year. Whatever dirty laundry is aired is unlikely to redound to LVS’ benefit. Official company rhetoric has even taken a turn for the pessimistic. One of the key points on which the case is sure to hinge is Hao’s contention that the joint proposal submitted by Sands and Galaxy was identical to one already drafted with AAEC. In light of the present imbroglio, Sands will surely line up behind Sociedade de Jogos de Macau in petitioning City Hall to push concession reviews back to 2023. SJM CEO Ambrose So gave the rather weak excuse that the concessions shouldn’t be under consideration while they’re performing poorly financially, thanks to Covid-19 (as though they didn’t have a lengthy track record already). More to the point, he said it would be unfair to some of the concession holders if current travel restrictions prevent them from coming to Macao to testify. Former lawmaker and present casino executive Melinda Chan agreed, doubting that the government could wrap up the process in a year. In any event, Sands is sure to want whatever extension it can get.

As everywhere else, April sports betting was down from March in Illinois but came to a hefty $537 million handle, second only to New Jersey. Of that, sports books held $43.5 million. Market share was led by Fairmount Park (34.5%, $178 million), which is newly partnered with FanDuel. DraftKings at Casino Queen was next with 32% ($169.5 million). Three other casinos accounted for the rest of the action: Rivers Casino Des Plaines/Bet Rivers ($84 million; 14%), Hollywood Aurora/Barstool Sports (10%, $51.5 million—an auspicious debut) and Hawthorne Race Course/PointsBet (7%). William Hill didn’t make more than a 1.5% dent while FanDuel-bereft Par-A-Dice sank to 0%. In the waning hours of the Lege, it threw sports books a bone, allowing them to take walk-up wagers on in-state collegiate teams—but not over the Internet. That may be a crumb rather than a bone, although the obvious intent seems to be to incentivize in-person registration and retail wagering.

Meanwhile, in Wyoming, operators are itching to get into the state, even before regulations have been put into place. This caused Wyoming Gaming Commission prexy Bob Davis to laugh and say “I think that’s putting the cart before the horse.” Following the Tennessee model (a good one), Wyoming’s sports betting will be online-only. If its any consolation to DraftKings and its brethren, rules have to be in place by Sept. 1. Once that happens, there’s a three-month licensing window, so books are certain to miss the beginning of football season and maybe almost all of it. Of the taxes collected, $300K will be dedicated to handling problem gambling. Wyoming is also experimenting with something known as “exchange betting, “a form of wagering in which two or more persons place identically opposing wagers in a given market, allowing patrons to wager on both winning and non-winning outcomes in the same event.” If it takes off in Wyoming, look for it to be demanded elsewhere.

A Stiff Of The Week award goes out to Nevada Resort Association President Virginia Valentine, who shamefully argued that it’s better for casinos to be able to hire new, cheaper workers than give ones displaced by the Great Shutdown their old jobs. Nevada‘s new “Right to return law” would, Valentine whines, “an arduous burden on employers through needless, time-consuming requirements that will significantly slow down rehiring.” That’s a big ‘fuck you’ to still-unemployed Culinary Union members and begs the question of where (and how) casinos are supposed to find these fanciful virgin employees. Whilst Valentine prances with unicorns and sprinkles fairy dust, Nevada Gov. Steve Sisolak (D) has signed to bill into law. At least the NRA stayed on the sidelines while the right-to-return bill was being debated in the Lege, suggesting that some of Valentine’s constituents at least think ‘right to return’ was the right thing to do.

As if one needed another reason to avoid Catholic school! The nun who was principal of St. James Elementary School in Redondo Beach, California, has pled guilty to pillaging $835,339 in tuition fees from school accounts in order to subsidize her gambling habit—despite her formal vow of poverty. Sister Mary Margaret Kreuper blew the embezzled funds on casino excursions to Las Vegas and Lake Tahoe. (The braintrust at R&R Partners could probably make a helluva promotional Vegas spot out of this.) A degenerate gambler, Sister Mary Margaret, ran up huge debts, motivating her to channel the 835 dimes into a personal fund set up under the cover of “St. James Convent Account.” Casino executives whose properties benefited from Sister Mary Margaret’s largesse should say a novena for her.

Jottings: Casino gaming came one step closer in New Hampshire Tuesday when Gov. Chris Sununu (R) signed a bill approving ‘historical horse racing’ machines at charitable gaming facilities. The parimutuel devices are ‘only’ Class II but Sununu is following the path of least resistance towards casinos … The Margaritaville phenomenon continues to burgeon. Jimmy Buffett will build a $370 million Parrothead palace in Times Square (without gambling) … Citing a “national exotic dancer shortage,” at least one New Orleans strip club is offering signing bonuses. No word on whether management at Larry Flynt’s Hustler Club New Orleans will stuff the extra $1K in dancers’ g-strings … Gamblers in Missouri were motivated, driving revenues last month 13.5% above 2019 levels. That’s better than April and further evidence of a sustainable recovery. Customers were fewer (-14%) but those who came played large (+32%). Penn National Gaming, Boyd Gaming and Caesars Entertainment all benefited from players’ exuberance …Another setback for Kentucky Downs; its application for a VLT parlor in Bowling Green was rejected by city fathers. Mayor Bob Alcott said “they don’t see this is as, you know, a venue that is really going to really help stimulate the economy.”