Laos Still Chasing $5M From US Casino Investors After 14-Year Feud

The government of Laos, one of the world’s few remaining one-party Communist states, is still chasing more than $5 million from the American businessmen behind a casino venture that descended into a bitter legal battle more than a decade ago. Savan Vegas, above, was the major success of the US-backed casino venture in Laos before relations with the government descended into a bitter legal battle. (Image: Savan Vegas) A US appeals court last week gave Laos another chance to pursue casino entrepreneur John K. Baldwin and his company, Bridge Capital, for the money. The ruling is the latest twist in a dispute dating to 2012 that has involved allegations of government interference, a failed settlement, and three international arbitration awards. Baldwin and fellow casino entrepreneur Shawn Scott arrived in Laos in 2007 with ambitious plans to build a casino business aimed partly at customers crossing the country’s borders. The pair established Sanum Investments and partnered with Laotian conglomerate ST Group. Baldwin later testified that the investors initially committed around $7.5 million to the venture, which envisaged two casino resorts and several slot clubs. Their biggest success was Savan Vegas, strategically located near the Friendship Bridge linking Laos with neighboring Thailand across the Mekong River. A planned second resort, Paksong Vegas, was never built. Partnership Turns Sour Within several years, however, the partnership had soured. In 2012, Sanum and Lao Holdings, an Aruba-based company created to hold the investors’ interests in Sanum, accused Laos of trying to force them out of the country after Savan Vegas had become successful. They took the dispute to international arbitration, claiming Laos had violated investment treaties protecting their businesses. The two sides reached a settlement in 2014, but that agreement also fell apart, and the casino companies renewed their claims. Ultimately, the gamble backfired. Arbitrators found against the companies and ordered them to pay millions of dollars toward Laos’ legal costs and expenses. One tribunal found in 2019 that Lao Holdings had acted in bad faith and ordered it to pay Laos $1.95 million. Another made a similar finding against Sanum and awarded the government $1.78 million. A third arbitration produced another award worth nearly $1.3 million, taking the amount Laos is seeking to more than $5 million. Who Pays the $5M? Seven years later, Laos says it is still trying to collect. That effort has led the government to Baldwin, Scott, and Bridge Capital, even though none was personally named as owing the money in the arbitration awards. Laos argues they were effectively indistinguishable from the companies that were ordered to pay and should therefore be held responsible for the debt. A federal judge previously rejected Laos’ attempt to pursue Baldwin and Bridge Capital because they had not been parties to the original arbitrations. But the Ninth US Circuit Court of Appeals reversed that decision Thursday (September 17). The appeals court did not rule that Baldwin or Bridge Capital owes Laos the money. Instead, it said the lower court must hear Laos’ argument that they should be responsible for awards made against the companies they allegedly controlled. That sends the sprawling Savan Vegas dispute back to court once again, 14 years after it began. Laos attorney David Branson told Law360 the government has been trying to collect the awards for more than seven years and said the latest ruling had cleared a “path to recovery.” The post Laos Still Chasing $5M From US Casino Investors After 14-Year Feud appeared first on Casino.org.