Genting Americas Moves to Dismiss $600M Lawsuit over Bahamas Casino Operations

With neither side in the lawsuit willing to back down, the proceedings could stretch for a long time, although Genting was adamant the case would not affect its other operationsImage Source: Shutterstock.com

Genting Americas Inc., a subsidiary of Genting Malaysia Bhd, has filed a motion to dismiss a $600 million lawsuit brought against it by RAV Bahamas Ltd.The dispute involves the Resorts World Bimini (RWB) casino complex in the Bahamas, as the plaintiff alleged that Genting engaged in coordinated and massive fraudulent actions.

Genting Argues the Accusations Are Without Merit

In its motion filed on 22 November, Genting Americasargued for dismissalof the case on several grounds. The operator contends that the matter should be resolved through mechanisms outlined in the BB Entertainment shareholders’ agreement, which both parties agreed to. These provisions entail arbitration outside US courts.

Genting continues to firmly believe that the Complaint is baseless and without merit and will continue to defend against these claims.

Genting Americas Inc. statement

The company also claims the lawsuit is time-barred, implying that the alleged grievances fall outside the permissible period for legal action. Genting contends that RAV Bahamas’ complaintlacks sufficient factual evidenceto meet the legal thresholds for fraud and other allegations. The operator remains adamantin its stance and appears prepared for a protracted legal battle.

RAV Bahamas Levies Serious Accusations

The Resorts World Bimini complex was an ambitious casino and resort projectexpected to become a significant regional tourism and entertainmenthub. However, the project has struggled since its inception, facing several years offinancial and operational issues, such as construction delays, high operational costs, and allegations of mismanagement.

RAV Bahamas, which has a22% sngakein the operating entity BB Entertainment Ltd, accuses Genting, the 78% majority sngakeholder, of mismanaging the integrated resort. The lawsuit, filed in theUS District Court for the Southern District of Florida, alleges that Genting burdened the property with nearly $1 billion in debt, turning it into a “financial wasteland.”

Other significant accusations claim that Genting devalued assetsat the resort, significantly impacting shareholder returns. The lawsuit also alleges the operator engaged in fraudulent activities, blocking dividend distributionsto minority shareholders. RAV Bahamas believes these actions caused significant financial lossesand a drastic reduction in the value of its investment.

Only a massive and coordinated fraud could dump nearly a billion dollars of debt on a small island resort where RAV had already developed most of the significant infrastructure.

RAV Bahamas lawsuit

Despite the lawsuit, Genting Malaysia insists the claims will not materially impactits financial health and operations. Some industry watchers and financial analysts see this evolving case as a test of Genting’s ability tonavigate disputesinvolving minority sngakeholders in its international ventures. The lawsuit could also have broader implications forforeign investmentsin the Bahamas.