A Singapore arbitration court has ordered Philippine casino operator Bloomberry Resorts Corp. to pay just under $300 million to Las Vegas-based company Global Gaming Philippines LLC (GGAM) in a legal dispute stemming from the latter’s removal from the management of Solaire Resort & Casino.
The court ruled that Bloomberry should pay GGAM the amount of $296 million in an arbitral award in the case filed by GGAM. The latter company claimed that its removal from the Manila-based hotel and casino resort was unjust.
Under an agreement between Bloomberry and GGAM, the latter was supposed to provide planning, technical, and other advisory services to Solaire during construction phase and management services once the resort became commercially operational in 2013.
However, Bloomberry and Sureste Properties Inc., a Bloomberry subsidiary responsible for the operation of Solaire’s hotel and other non-gambling facilities, terminated their management contract with GGAM just a few months after the opening of the integrated resort in the Philippine capital.
Bloomberry’s boss, Philippine business tycoon Enrique Razon, said back then that GGAM had breached its management services agreement with his company.
GGAM brought the matter to court, saying that its removal from Solaire’s management was unjust and that it was entitled to an 8.7% stake in Bloomberry.
The recent ruling issued by the Singaporean Arbitration Tribunal followed a 2016 ruling by the same court. The court sided with GGAM back then and ruled that the company was indeed booted out unjustly and had a rightful claim to the above-cited 8.7% stake.
The arbitration court’s ruling read that Bloomberry and its subsidiaries were not justified to terminate their agreement with GGAM because the services rendered by Bloomberry “should be considered as services rendered by GGAM” under the terms of the agreement.
”Fundamentally Flawed”
In disclosure to the Philippine Stock Exchange from Monday, Bloomberry said that the recent arbitration court ruling awarded “less than a half” of the compensation GGAM had demanded.
The Philippine gaming and hospitality operator was ordered to pay $85.2 million in damages for lost management fees, $391,224 in pre-termination fees and expenses, and PHP10.17 billion (approx. $281.2 million) for the 8.7% stake or 921.18 million shares of Bloomberry. GGAM will have to turn over the shares after it receives the payment. In addition, Bloomberry was ordered to pay nearly $15 million in arbitration costs.
The company said in its filing to the Philippine Stock Exchange that it believes the final remedies award was “fundamentally flawed” and that its legal counsel is now considering their next moves and is reviewing their options in Singapore and in other jurisdictions.
Earlier, Bloomberry’s subsidiaries have sought to have the prior Singapore Arbitration Tribunal ruling disregarded, saying that the partial award on liability ordered by that court was “procured by fraud and is in violation of public policy.”
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