Australian casino operator Crown Resorts Ltd was slapped with a class action lawsuit on Monday for allegedly failing to inform shareholders of a marketing campaign in China that resulted in staff arrests and a slump in the share price.Almost 20 employees had been arrested in China for marketing gambling trips to Macau. While gambling is legal in the southern Chinese territory, it is illegal on the mainland. All of the Crown employees who were detained in China have now been released.
The arrests triggered an abrupt reversal in Crown's offshore ambitions and an admission from Packer that his "global strategy" had failed. Australia's biggest casino company quit Macau and Las Vegas to focus on Australia. Trading volumes at Crown resorts have slumped in the fall-out of the arrests, as profits generated from high rollers plummeted.
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