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September 18, 2014

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Nevada Supreme Court reverses Adelson defamation ruling

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Steve Marcus

Sheldon Adelson, chairman of the board and CEO of Las Vegas Sands Corp., listens to New Jersey Gov. Chris Christie during the Republican Jewish Coalition Spring Leadership Meeting at the Venetian on Saturday, March 29, 2014.

Updated Friday, May 30, 2014 | 4:43 p.m.

CARSON CITY — A divided Nevada Supreme Court revived a defamation lawsuit Friday filed by a former Las Vegas Sands Corp. executive against billionaire Chairman Sheldon Adelson.

In a 4-3 opinion, the justices reversed a lower court and sent the defamation claim brought by former Sands executive Steven Jacobs back to Clark County District Court for further proceedings.

Jacobs worked in Macau for the Sands subsidiary Sands China Ltd. He filed a wrongful-termination suit in 2010 and accused Sands of a multitude of misdeeds, including doing business with known gangsters and making inappropriate payments to an attorney who was also a Macau lawmaker.

He later added a defamation claim after Adelson told the Wall Street Journal that Jacobs was fired for cause and called his former employee a liar and delusional.

The article cited an email from Adelson, included in the court opinion, that read: "We have a substantial list of reasons why Steve Jacobs was fired for cause and interestingly he has not refuted a single one of them. Instead, he has attempted to explain his termination by using outright lies and fabrications which seem to have their origins in delusion."

Clark County District Judge Elizabeth Gonzalez earlier dismissed the claim, saying Adelson's comments to the newspaper were protected by litigation privilege.

But the high court said that privilege is not absolute when it comes to statements made to the media outside judicial proceedings in which the media has no more significant interest in the outcome of a case than the general public.

"Accordingly, we conclude that the Wall Street Journal does not have any legal or financial interest in the underlying litigation, and thus, is not significantly interested in the litigation for purposes of the absolute privilege," Justice James Hardesty wrote for the majority.

In a dissent, Justice Michael Cherry noted the era of "the unrelenting 24-hour news cycle" and said the public interest would be served by hearing both sides of a legal dispute.

"When the media is covering a case, replies to allegations should be allowed as a right ..." Cherry wrote. "People are often judged not on the outcome of their case, but on the media's portrayal of them during the proceedings. To tie their hands would unduly subject parties to restrictions on their personal and/or professional need for freedom of speech at a time when the world is watching."

Cherry said Jacobs was allowed to tell his side of the story with impunity. "To say that Adelson must wait to respond through a legal channel is absurd," he said.

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