Las Vegas Sands wants shareholder lawsuits thrown out
Hotel and gaming operator Las Vegas Sands Corp. is trying to have three lawsuits filed by disgruntled shareholders thrown out of court.
The Las Vegas company, led by Chairman and Chief Executive Sheldon Adelson, says in Clark County District Court filings that the three suits filed since November should be dismissed because the four shareholders involved failed to make required demands on the board of directors before they sued; and because their allegations are false.
Represented by attorneys Steve Morris and Akke Levin of the Las Vegas law firm Morris Peterson and Walter Carlson of the Chicago firm Sidley Austin LLP, Las Vegas Sands says it hopes to have the cases -- which have been combined into one proceeding -- dismissed during a June hearing.
The shareholders filed "derivative" lawsuits seeking to have the company sue its own board of directors, charging the directors mismanaged the company, that Adelson put his own interests ahead of the company's and that the directors are responsible for the value of its stock being nearly wiped out -- falling from about $125 in November 2007 to $1.38 in March 2009. The stock has since advanced to close at $9.38 today.
In its response, Las Vegas Sands recounted how it reacted to global economic turmoil and its own liquidity problems as Adelson and his family bought $475 million in notes issued by the company in September 2008 and the Adelsons then invested heavily in a $2.1 billion equity offering in November.
"Plaintiffs did not offer a single allegation to support the conclusion that the board failed to act in the best interests of the company by approving the equity raise," the Sands attorneys argued. "Indeed, plaintiffs themselves alleged to the contrary, alleging that had the equity infusion transactions not taken place, the company would have violated its debt covenants and would have faced a going concern qualification from its auditors."
A "going concern" qualification would indicate a company is headed toward insolvency or bankruptcy.
In one of the suits, the plaintiffs charged: "Adelson has capitalized upon the economic downturn and faltering financial condition of the company by making additional substantial investments in Las Vegas Sands that have continued to dilute the common shareholders’ interests, without their input or consent, while cementing his majority stake in the company. Adelson, together with other members of the board who are beholden to him, have mismanaged the company and damaged its prospects by spreading the company too thin over numerous projects that, for one reason or another, were impossible to complete under the conditions then-existing."
Those allegations are wrong, Sands said in its court filing this month.
"Plaintiffs failed to allege any facts indicating that Adelson acted in a self-interested manner with regard to the equity raise," the Sands response continued.
The Sands attorneys argued the suing shareholders failed to come up with any particularized allegations of intentional misconduct or fraud on the part of the directors.
"Instead, plaintiffs actually alleged how the board responded to the unprecedented crisis in the financial markets and gaming industry during 2008 by cutting short-term expenses and arranging for debt and equity infusions and took action to enhance Las Vegas Sands' corporate governance by forming a committee to resolve disagreements by management," the attorneys agued.
The attorneys also disputed allegations that the board members are not independent of Adelson because of his majority ownership of its stock, saying that argument is irrelevant because in his infusions of capital into the company in 2008, Adelson was treated the same as all other shareholders.
And Las Vegas Sands isn't alone in facing financial challenges, the attorneys noted, pointing to Boyd Gaming Corp.'s delay of its Echelon resort and MGM Mirage's extraordinary efforts to secure financing for its CityCenter complex, both on the Las Vegas Strip.
On May 5, Las Vegas Sands said financing costs led to a widening of its first quarter loss, from $11.2 million or 3 cents per share in 2008's first quarter to $87.7 million or 14 cents in the 2009 quarter ended March 31.
Revenue before promotional allowances of $1.173 billion was up from $1.148 billion in the year-ago quarter.
was uns wohl am dienstag erwartet??steigen oder fallen??? |
Thread abonnieren
