A New York appeals court
has affirmed a $1.6 billion award for a developer of a construction project
against various subsidiaries of a state corporation from China. The dispute
involves the construction of the Baha Mar beach resort complex in Nassau. After
a series of delays that prevented the resort from opening as planned in March
2015, the developer filed for bankruptcy and sued various state-owned entities,
including the minority investor, prime contractor, construction manager, and
others for breach of contract, fraud, and alter ego theories. The lower court
pierced the defendants’ corporate veils and awarded the developer $845 million
for the loss of its entire investment, plus prejudgment interest of $830
million. The court held that the prime contractor entity exercised complete
domination over the other defendants in order to breach the investor agreement,
defraud the plaintiff, and cause the collapse of the project.
