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Australia's Crown Resorts settles lawsuit on 2016 China marketing for $94 million - Metro US

Australia’s Crown Resorts settles lawsuit on 2016 China marketing for $94 million

FILE PHOTO: The logo of Australian casino giant Crown Resorts Ltd adorns the hotel and casino complex in Melbourne, Australia

(Reuters) – Australia’s Crown Resorts said on Friday it settled a class-action lawsuit that alleged the casino operator failed to inform shareholders of a marketing campaign in China that led to a sharp fall in shares when staff were detained in 2016.

The company said settling the lawsuit https://www.reuters.com/article/us-crown-resorts-lawsuit-idUSKBN1DY028 for A$125 million ($94.25 million) was a “commercial decision” and comes days after Crown was found unsuitable to hold a gambling licence in Melbourne but was allowed to continue running it under supervision.

Shares of Crown dived 14% on Oct. 17, 2016 after it confirmed that some of its staff in China had been detained for illegally promoting gambling.

The settlement was without an admission of liability and Crown expects to recover a large portion of it from its insurers, which it cautioned was still subject to negotiations.

Crown has been plagued by many damaging allegations, including of enabling money laundering and misleading regulators, which a Royal Commission called “disgraceful” in a report published on Tuesday.

($1 = 1.3263 Australian dollars)

(Reporting by Nikhil Kurian Nainan in Bengaluru; Editing by Arun Koyyur)

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