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 Americas argued for dismissal of 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’ complaint lacks sufficient factual evidence to meet the legal thresholds for fraud and other allegations. The operator remains adamant in 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 project expected to become a significant regional tourism and entertainment hub. However, the project has struggled since its inception, facing several years of financial and operational issues, such as construction delays, high operational costs, and allegations of mismanagement.
RAV Bahamas, which has a 22% stake in the operating entity BB Entertainment Ltd, accuses Genting, the 78% majority stakeholder, of mismanaging the integrated resort. The lawsuit, filed in the US 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 assets at the resort, significantly impacting shareholder returns. The lawsuit also alleges the operator engaged in fraudulent activities, blocking dividend distributions to minority shareholders. RAV Bahamas believes these actions caused significant financial losses and 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 impact its financial health and operations. Some industry watchers and financial analysts see this evolving case as a test of Genting’s ability to navigate disputes involving minority stakeholders in its international ventures. The lawsuit could also have broader implications for foreign investments in the Bahamas.
