Melco launches eleventh-hour appeal

By William Brown Updated
Macau gaming update delivered by Melco

Melco Resorts, the casino empire owned by Macau gaming tycoon Lawrence Ho, has launched a late challenge to the New South Wales gaming regulator, claiming the regulator is attempting to overstep its power in its upcoming casino inquiry.

The Australian reports that the unusual legal action, set down for an urgent hearing in the New South Wales Supreme Court yesterday, comes less than three weeks before the Independent Liquor and Gaming Authority begins the first hearing of its no-holds-barred inquiry.

The inquiry was triggered by James Packer’s decision to sell 19.99 per cent of his Crown shares, potentially worth $1.75 billion, to Melco Resorts.

At stake in the inquiry is Crown’s fitness to hold its casino licence at Sydney’s latest casino, Crown Barangaroo, which is expected to open its doors on Christmas Day this year.

In the court notice filed by Melco Resorts, the company claims the inquiry’s legal team has misinterpreted its powers by insisting it can compel Melco to produce documents that breach the legal and professional privilege between lawyers and their clients.

Melco argues that while the company has eben cooperating with the inquiry, it should be entitled to refuse to produce certain documents, or parts of documents, on the ground of legal professional privilege.

Melco disputes that section 17(1) of the Royal Commission Act, which would give the inquiry the power to breach legal privilege, even comes “into effect for the purposes of the inquiry”.

The legal challenge by Melco flags the deep unease among senior operatives at both Melco Resorts and Crown Resorts’ casino operations.

At the opening of the inquiry last month, counsel assisting Adam Bell SC alluded to some of the behind-the-scenes wrangling with Melco’s lawyers over the issue of its powers since at least September.

Melco documents seized

A Macau casino operator vying for half of James Packer’s stake in Crown casinos has been embroiled in a political bribery investigation in Japan.

The Brisbane Times reported last month that news of the investigation came hours after sweeping changes to Crown’s board were announced in Australia.

Asian media outlets reported yesterday that authorities had seized documents from the Tokyo office of Melco Resorts and Entertainment between January 17 and 20.

The reports said the raids related to a public prosecutor’s investigation into a Japanese parliamentarian, Tsukasa Akimoto, who was arrested on January 14 on suspicion of accepting a bribe from a Chinese corporation.

Melco confirmed to The Sunday Age that the raids had taken place but had no further comment.

On Friday, Crown Resorts’ most senior board member John Alexander stepped down as executive chairman of the embattled casino group as part of its sweeping governance overhaul.

The company also announced that former Liberal senator and current board director Helen Coonan would take over as non-executive chairman of Crown.

Chief financial officer Ken Barton will be elevated to chief executive officer and former AFL boss Andrew Demetriou will become chairman of Crown in Melbourne.

The changes come as Crown faces intense scrutiny from a public inquiry into the company and the future of its casino licence in Sydney.

That in turn followed revelations in The Age that Crown went into business with “junket” tour operators linked to organised crime.

Mr Packer, Crown’s billionaire controlling shareholder, has been called to appear at the inquiry as has Mr Alexander.

Mr Packer struck a deal last year to sell almost half his stake in Crown to Melco Resorts for $1.7 billion, which now hangs in the balance.

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