Packer's lawyers defend his character

Hannah Ryan
·3-min read

James Packer is not to blame for the failures of Crown Resorts, his lawyers have told an inquiry into whether the gaming giant is suitable to run a new Sydney casino.

They say the billionaire only gave advice to Crown, not instructions, after he stepped down from the board in 2018.

At stake in the inquiry is the future of a the $2.2 billion casino at Barangaroo, scheduled to open next month.

The NSW Independent Liquor and Gaming Authority probe is examining whether Crown is suitable to hold the licence for the casino.

Counsel assisting the inquiry argue that Crown's poor corporate governance and risk management processes, which led it into relationships with dodgy junket operators and allowed its casinos to be used for money laundering, mean it is not suitable to hold the licence.

They also say Mr Packer is not fit to be a close associate of the licensee.

The mogul gave three days of gruelling evidence by videolink in October, which canvassed the mental health problems he blamed for a "disgraceful" email he sent a potential investor.

"I think caps on shareholders may be something that you will think about," Mr Packer told inquiry commissioner Patricia Bergin, admitting he may need to shed some of his shares in the company.

The lawyers assisting the inquiry have painted a picture of Mr Packer as a domineering personality who is focused on profit and demands loyalty, exerting control over the public company even after he left the board in 2018.

Mr Packer's lawyers are seeking in their closing submissions to persuade Ms Bergin that Mr Packer's influence over Crown is more benign.

Where counsel assisting argued Mr Packer had so much power and information he was really a de facto director of Crown, the barrister representing his private company Consolidated Press Holdings, Noel Hutley SC, says he has acted merely as an interested shareholder and advisor.

CPH holds a 36.8 per cent stake in Crown.

Mr Hutley says a controlling shareholder agreement which gave Mr Packer access to confidential financial information was a two-way street, which gave Crown the benefit of Mr Packer's insights.

Crown chose to seek advice from Mr Packer to maximise profit, and its board was not bound to follow that advice, Mr Hutley said on Wednesday.

Ms Bergin suggested while that may have technically been the case, Mr Packer's powerful personality may have made the board "supine" to a desire to make Mr Packer proud of them.

Mr Packer's advice did not bring the company any harm and the board was sufficiently independent of the Packer family, Mr Hutley said.

He argued CPH's attempted sale of 19.99 per cent of Crown stock to Melco Resorts, which partly prompted the inquiry, did not pose a problem for Crown's suitability to hold the licence.

Crown had an agreement with the NSW regulator not to allow Dr Stanley Ho to gain an interest in its casinos, and Melco is run by Dr Ho's son Lawrence.

The inquiry is investigating whether the transaction caused Crown to breach the agreement.

Mr Hutley said there had been no reason to suspect Dr Ho had any interest in Melco Resorts.

Mr Packer's evidence was "thoughtful, honest and clear" and he had acknowledged that many things he heard in the inquiry were a shock and disquieting, Mr Hutley said.

The barrister described his client as a man of "real character, real integrity and real honesty".

Lawyers for Crown will address the inquiry separately.

The regulator is reportedly set to meet with Crown next Wednesday to discuss whether to push back or put conditions on the casino's opening.

Ms Bergin is due to issue a report in February.