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Las Vegas Sands Accuses Former Macau CEO, Steven Jacobs,
of Stealing Information

By Steve Green, Las Vegas SunMcClatchy-Tribune Regional News

Sept. 14, 2011--International casino giant Las Vegas Sands Corp. has hit its former Macau CEO with new accusations that he stole massive amounts of sensitive company information and now refuses to return it.

The charge was made in Clark County District Court on Tuesday by attorneys for Sands against Steven Jacobs.

Court records show attorneys for Jacobs are denying the allegations.

Jacobs sued Las Vegas Sands and subsidiary Sands China Ltd. last year, charging he was wrongfully fired and denied stock options he was entitled to after he clashed with Sands CEO Sheldon Adelson.

Jacobs says some of these disputes were over allegedly "improper and illegal demands" made by Adelson involving allegedly improper exertion of influence with Macau government officials.

Las Vegas Sands disputes this and says Jacobs was fired for violations of company policy and working on unauthorized deals.

In a counterclaim against Jacobs, Las Vegas Sands also accuses him of being slow to distance the company from a triad figure and of extortion for threatening to go public with damaging information unless he was paid after his firing -- charges denied by Jacobs.

The lawsuit has attracted significant attention in the gaming industry and is responsible for shareholder lawsuits and government investigations.

The legal dispute covers territory of significant interest to regulators including efforts to reign in the influence of organized crime triads in Macau casinos as well as Las Vegas Sands' compliance with a U.S. law banning bribes to foreign officials.

In its latest court filings Tuesday, attorneys for Las Vegas Sands charged Jacobs had stolen sensitive and/or privileged documents from it and subsidiaries Sands China and Venetian Macau Ltd. This information includes various reports and scores of emails, including some sent to Jacobs by Sands and Sands China attorneys while he worked there.

"Las Vegas Sands' suspicions were born out recently when plaintiff's counsel revealed and explicitly admitted that Jacobs had in his possession approximately 11 gigabytes of documents taken from Las Vegas Sands, Sands China and/or Venetian Macau, including documents that Jacobs admitted were subject to the attorney-client privilege and should properly be returned to Las Vegas Sands," Sands' filing said. "After initially agreeing to produce certain potentially privileged documents, Jacobs now refuses to return any documents to Las Vegas Sands."

Las Vegas Sands asked the Nevada court to require return of all the material.

Las Vegas Sands said it needs to determine whether any of the documents are subject to the Macau Personal Data Protection Act.

The company said Jacobs' possession of this material potentially exposes Las Vegas Sands and its subsidiaries to criminal penalties under the act barring the removal of certain information from Macau.

"Las Vegas Sands has serious concerns that Jacobs will disclose company documents that contain personal data in violation of Macau law. The Macau Act provides for serious sanctions in such circumstances," the company's filing said. "Any such sanctions could be financially devastating to Las Vegas Sands, as a substantial portion of Las Vegas Sands' revenue is derived from its ownership interest in Sands China Ltd."

Donald Campbell of Las Vegas, one of Jacobs' attorneys, responded in November to a claim by a Sands China attorney that Jacobs may wrongly be in possession of company information.

"It has been our experience that wrongfully terminated corporate executives are often -- and properly -- in possession of a multitude of documents received during the ordinary course of their employment. That does not mean the documents were 'stolen,'" Campbell told the attorney in a letter.

Justin Jones, one of the Las Vegas Sands attorneys, said in a court declaration he discussed the issue with Jacobs' attorneys on Aug. 1 of this year and Jacobs' counsel related that:

-- "Jacobs does not believe that he is bound to keep confidential those documents obtained during the course of his employment because he asserts that he did not sign any confidentiality policy or other document containing a confidentially provision."

-- "Jacobs believes that Macau data privacy laws do not prohibit him from disclosing documents in this matter and that Macau data privacy laws are being used by defendants as a 'farcical canard' to avoid disclosure of documents."

An Oct. 18 hearing is planned on Sands' demand that the information at issue be returned.

This week's filings are just the latest twists in a case that has seen Jacobs hit Adelson with a defamation claim for saying Jacobs has been lying and was fired for cause. Clark County District Court Judge Elizabeth Gonzalez dismissed that claim, but it's now on appeal to the Nevada Supreme Court.

Most recently, the state Supreme Court ordered Gonzalez to re-visit her ruling that Sands China is subject to the jurisdiction of Nevada courts.

Separately, Campbell's representation of Jacobs in the lawsuit is ending, though the attorney hasn't said why he's leaving the case. The suit is expected to continue with another attorney or attorneys representing Jacobs.


(c)2011 the Las Vegas Sun (Las Vegas, Nev.)

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