Summary

GLOBAL GAMING PHILIPPINES LLC (AS ASSIGNOR)
GGAM NETHERLANDS B.V. (AS ASSIGNEE)

AND

BLOOMBERRY RESORTS AND HOTELS INC.
SURESTE PROPERTIES, INC.

PARTIAL AWARD ON LIABILITY - 20 SEPTEMBER 2016

The Arbitral Tribunal:
Mr. R Doak Bishop, Esq. (Arbitrator)
Mr. Michael Hwang, S.C. (Arbitrator)
Dr. Andres Rigo Sureda (Presiding Arbitrator)

Table of Contents

I. PARTIES
A. CLAIMANTS
B. RESPONDENTS
II. PROCEDURAL HISTORY
A. PROCEEDINGS FOLLOWING THE INTERIM MEASURES HEARING
B. PROCEDURAL ORDERS ISSUED SINCE THE INTERIM MEASURES HEARING
C. HEARING ON LIABILITY
D. INTERLOCUTORY MATTERS
E. PRIVILEGE LOG
F. FILING OF ADDITIONAL DOCUMENTS
III. CHRONOLOGY OF EVENTS LEADING TO THE ARBITRATION
IV. RELIEF SOUGHT BY THE PARTIES
A. CLAIMANTS' RELIEF SOUGHT
B. RESPONDENTS' RELIEF SOUGHT
V. PRELIMINARY MATTERS
A. APPLICABLE LAW
B. PLEADINGS RELATED TO THE CONSTRUCTION OF THE CASINO
C. CONTRACT INTERPRETATION
VI. ALLEGED MISREPRESENTATIONS AND/OR CONDUCT OF GGAM AMOUNTING
TO CAUSAL FRAUD
A. RESPONDENTS' ARGUMENTS
(i) Equating GGAM with Las Vegas Sands
(ii) Guest and VIP Player Data
(iii)Possession or Development of Policies and Procedures
(iv) Hands-on Management
(v) Cantor's role
B. CLAIMANTS' ARGUMENTS
(i) Equating GGAM with Las Vegas Sands
(ii) Guest and VIP Player Data
(iii)Possession or Development of Policies and Procedures
(iv) Hands-on Management
(v) Cantor's role
C. TRIBUNAL'S ANALYSIS
(i) Equating GGAM with Las Vegas Sands
(ii) Relationships with Junket Operators and Possession of Guest Data
(iii)Possession of Policies and Procedures
(iv) Hands-on Management
(v) Cantor's role
VII. THE MISTAKE ARGUMENT
VIII. TERMINATION OF THE MSA UNDER CLAUSE 15.1(A)
A. RESPONDENTS' GENERAL ARGUMENTS
B. CLAIMANTS' GENERAL ARGUMENTS
IX. ALLEGED FAILURE TO SUBMIT BUSINESS AND MARKETING PLANS THAT MET PRUDENT INDUSTRY PRACTICE
A. RESPONDENTS' ARGUMENTS
(i) Scope of the Claimants' Obligation
(ii) Business Plan
(iii)Marketing Plan
B. CLAIMANTS' ARGUMENTS
(i) Business Plan
(ii) Marketing Plan
C. ANALYSIS OF THE TRIBUNAL
(i) Scope of the Claimants' Obligations
(ii) Business and Marketing Plans
X. BREACH OF THE OBLIGATION TO ESTABLISH POLICIES AND PROCEDURES (ANNEX A TO THE MSA)
A. RESPONDENTS' ARGUMENTS
B. CLAIMANTS' ARGUMENTS
C. ANALYSIS OF THE TRIBUNAL
XI. BREACH OF CLAUSE 2.5 OF THE MSA ("STANDARD OF CARE")
A. RESPONDENTS' ARGUMENTS
B. CLAIMANTS' ARGUMENTS
C. ANALYSIS OF THE TRIBUNAL
XII. BREACH OF THE OBLIGATION TO PROVIDE "HANDS-ON MANAGEMENT"
A. RESPONDENTS' ARGUMENTS
B. CLAIMANTS' ARGUMENTS'
C. ANALYSIS OF THE TRIBUNAL
XIII. BREACH OF CLAUSE 16.2 OF THE MSA
A. RESPONDENTS' ARGUMENTS
B. CLAIMANTS' ARGUMENTS
C. ANALYSIS OF THE TRIBUNAL
XIV. TERMINATION OF THE MSA UNDER CLAUSES 15.3(B) OR 17
XV. THE CLAIMANTS' CLAIM THAT RESPONDENTS BREACHED THE MSA BY TERMINATING IT
XVI. LEGALITY OR PROPRIETY OF THE TERMINATION OF THE MSA: PRIOR CONFIRMATION OF THE TERMINATION BY AN ARBITRAL TRIBUNAL
A. CLAIMANTS' ARGUMENTS
B. RESPONDENTS' ARGUMENTS
C. ANALYSIS OF THE TRIBUNAL
XVII. WHETHER THE RESPONDENTS FAILED TO PAY GGAM ITS MANAGEMENT SERVICE FEES AND THEREBY BREACHED CLAUSES 3.4 AND 4 OF THE MSA
A. CLAIMANTS' ARGUMENTS
B. RESPONDENTS' ARGUMENTS
C. ANALYSIS OF THE TRIBUNAL
XVIII. THE CLAIM THAT THE RESPONDENTS MADE FALSE AND DEFAMATORY STATEMENTS ABOUT THE CLAIMANTS AND/OR THE ALLEGED BREACHES OF CLAUSE 14.2 AND 18.9 OF THE MSA
A. CLAIMANTS' ARGUMENTS
B. RESPONDENTS' ARGUMENTS
C. ANALYSIS OF THE TRIBUNAL
XIX. WHETHER THE RESPONDENTS ARE ENTITLED TO RESOLUTION OR ANNULMENT OF THE MSA, INCLUDING THE EQUITY OPTION AND THE EOA UNDER PHILIPPINE LAW
XX. RESPONDENTS' CLAIM OF UNJUST ENRICHMENT
A. RESPONDENTS' ARGUMENTS
B. CLAIMANTS' ARGUMENTS
C. ANALYSIS OF THE TRIBUNAL
XXI. DISCLOSURE OF THE LIABILITY AWARD
XXII. RESPONDENTS' CONCERNS ON PROCEDURAL EQUALITY AND BALANCE
XXIII. OTHER MATTERS
XXIV. RELIEF AND REMEDIES
XXV. COSTS
XXVI. DECISION
ANNEX TO THE AWARD ON LIABILITY: RESPONDENTS' CONCERNS ON PROCEDURAL FAIRNESS AND EQUALITY

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II. PROCEDURAL HISTORY

A. Proceedings following the Interim Measures Hearing

6. The procedural history of the present proceedings has been set out at paragraphs 6 - 23 of the Tribunal's decision dated December 9, 2014 following an interim measures hearing from October 20 - 22, 2014 in Washington, D.C. (the "Decision"). The Decision also sets out other relevant background details of the dispute, which will therefore not be repeated in this Partial Award on Liability (the "Liability Award").

7. The Liability Award adopts the abbreviations set out in the Decision, and sets out the procedural history following the interim measures hearing.

8. On September 8, 2014, the Claimants filed their Statement of Claim ("SOC").

9. On December 7, 2014, the Respondents filed their Statement of Defense along with (among others) the following documents:

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XXVI. DECISION

For the reasons set forth above, the Tribunal has decided:

1. That there was no causal fraud or misrepresentation by the Claimants in relation to the MSA.

2. That the Respondents have not substantiated their claim that the MSA is voidable on the basis of Article 1331 of the Philippine Civil Code.

3. That the Respondents' termination of the MSA was not justified, and thus constitutes a breach of the MSA.

4. That the Respondents had no basis to rescind or annul the MSA.

5. That there is no basis on which to rescind the EOA or to require the return of the shares.

6. To reject the Respondents' claim that GGAM would be unjustly enriched if permitted to sell the Shares.

7. That there is no basis for the Respondents to challenge GGAM's title to the Shares in BRC on the grounds pleaded, and thus GGAM can exercise its rights in relation to the Shares, including the right to sell them.

8. That the Respondents breached the MSA and are liable for the management fees in an amount to be determined in the Remedies Phase.

9. To reject the claim that the Respondents have defamed GGAM and breached Clauses 14.2 and 18.9 of the MSA.

10. To reserve its decisions on the matters outlined in paragraph 324 above.

11. To reserve its decisions on relief, remedies and costs to the Remedies Phase (as well as the question of whether there is any difference between the respective rights and liabilities of each of the Claimants and/or the Respondents).

12. Except as reserved and decided above, all other claims and counterclaims are dismissed.

13. To consult the Parties on the organization of the Remedies Phase.

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