The battle of the competing Okada Manila boards may be nearing an end, thanks to the Philippine Department of Justice (DOJ). Last week, the DOJ handed down indictments against casino magnate Kazuo Okada and his associates for their actions in the May 31 seizure of Okada Manila.
On that day, representatives of the Japanese billionaire stormed the eponymous integrated resort (IR) in Manila’s Entertainment City casino district. They then ejected the existing board of directors and installed an Okada-approved team.
According to witnesses who were inside the resort at the time, the occupation was violent and resulted in injuries to some staff members. Attorneys for Tiger Resort Leisure and Entertainment, Inc. (TRLEI), which operates the resort, filed criminal complaints alleging a “brutal, forceful, and anomalous takeover” of the IR.
The DOJ dismissed some of the charges, including kidnapping, serious illegal detention, unjust vexation and direct assault, due to lack of evidence. The agency did accept allegations of grave coercion in the matter.
According to Business Week, under the Philippine penal code, “grave coercion” occurs when one person keeps another from doing something that is not prohibited by law, sometimes using violence, threats or intimidation.
Universal Entertainment Corp. (UEC), which owns both TRLEI and its parent, Tiger Resort Asia Ltd. (TRAL), opened Okada Manila in December 2016. The next year, Kazuo Okada was ousted from the businesses he founded on allegations of mismanagement and embezzlement of company funds. He has worked ever since to regain control of the companies and the Manila resort.
He saw his chance in May, when the Philippine Supreme Court issued a status quo ante order (SQAO) that identified Okada as the lone representative of TRAL. Okada claimed the order gave him carte blanche to restore the 2017 board of directors, who served before his ouster from the company. The High Court later clarified that point, saying while the order recognized Okada’s interest in TRLEI as an indirect beneficial owner, it did not give him the right to restore the board or take over the property.
According to the DOJ, Okada’s team “precipitously went ahead with their unlawful plan to take control and possession of Okada Manila in the guise of implementing the SQAO.” That team included Okada himself as well as Anthony “Tonyboy” Cojuangco, Dindo Espeleta and Florentino “Binky” Herrera III.
According to the DOJ’s resolution, the group “exceeded and/or went beyond what the SQAO has simply allowed. Ineluctably, respondents Kazuo, Cojuangco, Espeleta and Herrera are deemed to have taken the law into their hands.”
The DOJ added that the Kazuo faction “illegally magnified the simple and general directive of the Supreme Court to maintain order in the business affairs and operations of Okada Manila… Respondents should act within the confines of the law and not resort to the commission of a felony.”
The agency added that the SQAO does not absolve the men from criminal liability for the coup. Though Okada himself was not physically present during the incident, he is equally liable due to prior knowledge of the plan.
In an October 3 statement, Hans Var Der Sande, TRLEI chief financial officer and board member, said, “We are grateful that the DOJ has started the ball rolling in advancing justice for the victims of the brutal takeover in May. We will continue to work with our lawyers and exhaust all legal means to win this case against the Kazuo Group.”
The returned board, which froze the company’s bank accounts during the occupation, has since accused the group of taking funds directly from the casino cage.
“We are now working on cleaning the mess that the Kazuo Group left—from stolen funds, fraudulent transactions and illegally fired employees to stolen documents and ransacked records—and are now beefing up the business for growth,” said Van Der Sande. “We are hopeful that the intra-corporate dispute will soon be settled with the honorable courts seeing the correctness of our position.”
The Philippine Amusement and Gaming Corp. (PAGCOR) ordered the reinstatement of the TRAL-backed board, with Byron Yip reinstated as president and CEO.
Interestingly, Inside Asian Gaming reported that the current board reclaimed the property “in scenes starkly similar to those witnessed at Okada Manila in May.”
“A group of around 50 people apparently representing the TRAL-backed board, all wearing red caps and white shirts, stormed the property on Friday accompanied by members of the Philippine National Police and PAGCOR representatives,” IAG reported. The news outlet stated that the property “was briefly locked down and guests required to stay in their rooms during the commotion, which saw the group clash with security.”
In related news, U.S.-based special purpose acquisition company (SPAC) 26 Capital Acquisition Corp., along with Okada Manila’s holding company, UE Resorts International Inc., have announced a 12-month extension to their proposed merger, which will result in a Nasdaq listing.
Despite the delay, 26 Capital Chairman and CEO Jason Ader said, “I remain extremely excited about this transaction and the opportunity for our investors to participate in one of the fastest growing Asian gaming markets.
“The fact that Universal Entertainment is willing to extend the agreement by a year demonstrates the dedication of both parties to complete the merger.”
The listing, under ticker symbol UERI, was due to be complete by June 30. After the coup, the deadline was pushed back by three months to September 30. The newest deadline is October 1, 2023.
