Nevada Judge Extends Ban on Wynn Documents Release

Massachusetts Gaming Commission Steve Wynn

The Massachusetts Gaming Commission wants Steve Wynn’s documents, but a Las Vegas judge shielded them from the MGC.

Clark County District Court Judge Elizabeth Gonzalez continues to withhold documents about Steve Wynn’s alleged misconduct from the Massachusetts Gaming Commission (MGC), which is seeking their release so they can end their probe of Wynn Resorts. Judge Gonzales extended a temporary ban on releasing documents in the continuing investigation.

Steve Wynn’s lawyers filed motions in November with Nevada District Judge Elaine Gonzales’s court saying that the documents are confidential and are protected under attorney-client privilege rules. In December, the judge placed her temporary block on the release of the documents.

The Massachusetts Gaming Commission originally obtained the documents in its investigation of whether the Wynn Resorts board of directors correctly handled allegations that Steve Wynn engaged in sexual harassment and other misconduct with female employees.

The MGC opened an investigation in Wynn executives’ conduct in May 2018. Its report on the probe was expected by December 2018, but the judge’s orders have stopped the investigation in its tracks.

Massachusetts Gaming Commission Report

Meanwhile, Massachusetts officials have called for the MGC to release its report. With the expected grand opening of Encore Boston Harbor only 5 months away in June 2019, those involved want to assure that the casino opens on time and tax revenues to the city of Everett and the Commonwealth of Massachusetts are uninterrupted.

There are tactical reasons for getting the licensing issues resolved quickly. Any new casino in an area must hire and train a staff of thousands of people. If the opening date is left in doubt, management has no idea when they should hire employees.

Encore Boston Harbor Grand Opening

Casinos in particular require up to 6 weeks of training for their dealers, so having a set date would help in planning. MGC commissioners might argue the probe would end if Wynn Resorts did not stonewall, but its former CEO, Steve Wynn, no longer has ties to the company. His lawsuit therefore is beyond the control of Wynn Resorts itself.

When questioned on Friday about the decision to going ahead with the June 2019 grand opening plans, an attorney for Wynn Resorts did not immediately state whether Judge Gonzales’s decision would delay executive decisions on the $2.4 billion casino resort.

Elaine Wynn v. Steve Wynn

For his part, Steve Wynn denies any wrongdoing in his years as Wynn Resorts’ leader and top shareholder. He claims that the allegations are the result of a bitter divorce with his former wife, Elaine Wynn. The couple separated in 2011, but with over 6 million shares of company stock, Elaine Wynn remained on the board of directors until 2016, when board members voted her out.

Elaine Wynn filed suit against her ex-husband and the Wynn board, seeking the ability to turn her Wynn shares into liquid assets. A deal assured she could not sell Wynn shares without the permission of Steve Wynn and the board.

As part of her lawsuit, Elaine Wynn claimed whistleblower protections and suggested that she knew of wrongdoing on the part of her ex-husband and the board. Her accusations never were revealed in the trial itself, but they came to light in a Wall Street Journal article in January 2018.

Steve Wynn Allegations

The general allegations by a number of former employees at the Wynn Las Vegas claimed that Steve Wynn harassed salon workers, seeking to use his position in the company to gain sexual favors. The #MeToo Movement had started 3 months prior, so the charges had an explosive effect in the casino industry.

Within weeks, Steve Wynn resigned as CEO of Wynn Resorts and his position as Republican National Committee’s Finance Chairman. A month later, Steve Wynn received the right to divest himself of 12 million shares of Wynn Resorts, thus severing ties with the company he founded in 2002. To this day, Wynn denies all wrongdoing.

Elaine Wynn Purges Wynn Board

The move left Elaine Wynn as the largest remaining shareholder. Throughout the spring and summer of 2018, she used that position to call for a purge of the Wynn Resorts board of directors, claiming many were complicit in Steve Wynn’s misconduct. Her pressure forced several key members to announce they would resign at the end of their term, while new CEO Matt Maddox brought 4 respected outsiders with no connection to Steve Wynn onto the board.

Maddox hopes those moves have assuaged concerns by the Massachusetts Gaming Commission that the Wynn board is tainted. With the largest casino resort in the history of Massachusetts on the line, the pressure is mounting for a decision. Already, the MGC’s chairman, Stephen Crosby, resigned 5 months early to avoid the controversy which is sure to follow — no matter what the ultimate decision is.

For now, all sides must wait for Judge Elizabeth Gonzales to rule on Steve Wynn’s documents.