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Hong Kong to Stay Out of Wharf, UIH Suit

Hong Kong -- The Hong Kong government has refused tointervene in Wharf Holdings' legal battle against United International Holdings Inc.over disputed plans by UIH to buy into Wharf's Cable TV system.

A Denver judge awarded UIH $US152 million almost a yearago, after ruling that Wharf had reneged on an oral agreement to allow the U.S. company totake a 10 percent stake in Hong Kong's monopoly pay TV provider in 1993.

Wharf launched an appeal in Denver, and it made informalapproaches to the Hong Kong government, asking for the case to be taken up at officiallevels. Wharf argued that a jury trial was not appropriate for a complex case thatincluded 8,000 pages of testimony. The company was also concerned that oral agreementswere given the status of contracts in the United States, unlike in Hong Kong, where onlywritten documents are legally binding.

Additionally, Wharf warned that the case had implicationsfor all Hong Kong companies doing business in the United States, after a judge orderedthat some of its U.S. assets be seized to help pay the fine.

But the Special Administrative Region of China's Tradeand Industry Department examined the case, along with submissions from UIH and evidencefrom U.S. legal experts, and it concluded that there were no grounds to question the U.S.courts. The department added that the size of the award was comparable to one that a HongKong court would have made.

"The bottom line is that Wharf presentedits defense and lost. It should now accept its legal liability," said UIH senior vicepresident Ellen Spangler.