Posted on: July 14, 2022, 11:35h.
Last updated on: July 14, 2022, 12:56h.
The Philippines Court of Appeals has upheld its December decision dismissing fraud and theft charges levied against Japanese billionaire Kazuo Okada.
Okada made his fortune through his founding of Universal Entertainment Corporation, a Japanese manufacturer of pachinko machines. His wealth, estimated by Forbes at $1.2 billion, was also amassed by being one of Steve Wynn’s first investors in Wynn Resorts.
In 2008, Okada, after having a fallout with Wynn over allegations that the pachinko tycoon bribed officials in the Philippines to obtain a gaming license in Manila’s Entertainment City, moved forward with building his first integrated resort. Okada Manila opened in 2016 at a cost of $2.4 billion.
Okada formed Tiger Resort, Leisure and Entertainment Inc. (TRLEI) to operate the property. Okada served as TRLEI chairman and CEO of the Universal gaming subsidiary until he was ousted in 2017. The removal was by the company’s board on allegations that he stole money from the firm.
Okada has maintained that the fraud claims against him were unfounded. But he was nonetheless forced out of Universal and TRLEI by their boards, which included members of his own family.
TRLEI governance alleges that Kazuo Okada stole at least $3 million in cash from the business. The Philippines Court of Appeals last December overruled a lower court’s conclusion. It determined that the TRLEI allegations against its founder had merit to take the charges to trial.
The appellate court said in its December ruling that there is no definitive evidence suggesting Okada purposely swindled money from TRLEI or Universal.
There was no misappropriation or conversion by Mr. Okada of the money received,” the Court of Appeals ruled.
TRLEI asked the appellate court to take another look at the evidence. But this week, the court affirmed its December decision.
The Court of Appeals affirmation is yet another victory for Okada, as he seeks to regain control of the Philippines gaming empire he created. The legal control of TRLEI remains in dispute after a raid ordered by Okada assumed governance of the gaming operator in late May.
The Philippines Supreme Court in April ordered TRLEI through a “Status Quo Ante Order” to restore its board composition to its 2017 arrangement, with Okada in control. Okada understood the ruling as his legal right to take back TRLEI through the May raid.
The former TRLEI group that ousted Okada has filed an “Urgent Motion for Reconsideration” with the Supreme Court. It asked all government bodies and agencies “to only deal with the legitimate board of TRLEI.”
Okada Manila is operating as normal despite the boardroom and management bedlam. But the governance disputes led to Universal this week telling investors that its second-quarter financial report would be delayed due to what the company claims was an unwarranted takeover of its most critical business segment.
“Mr. Kazuo Okada, former director of the company, and a group acting under his instructions intruded into the Okada Manila facility operated by TRLEI and usurped the facility and its operation on May 31, 2022, and continue to occupy the Okada Manila even now,” the Universal investor note explained. “Mr. Okada et al. have refused to provide any information whatsoever to the Company, leaving it unable to disclose a preliminary report according to its normal schedule.”