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Wynn Resorts clears final litigation as Steve and Elaine Wynn settle

Tuesday, 17 April 2018 06:26
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By Ben Blaschke and Andrew W Scott

Former Wynn Resorts boss Steve Wynn and ex-wife Elaine have agreed to settle the latter’s remaining claims relating to the alleged breach by Wynn in 2012 of a Stockholders Agreement between the two.

The settlement will also see Elaine Wynn release her claims against both Wynn Resorts and its General Counsel Kim Sinatra, with the company subsequently dropping its counter-claim emanating from the litigation that was first filed in 2012.

The news, announced in an SEC filing early Tuesday Macau time, marks a significant moment for Wynn Resorts which has now settled all litigation relating to the Stockholders Agreement and subsequent forced redemption of co-founder Kazuo Okada’s US$2.7 billion stake in 2015. Okada was also part of the original Stockholders Agreement.

In the two months since Steve Wynn stepped down from the board amid multiple sexual misconduct allegations, Wynn Resorts has been actively looking to clear the decks in the midst of ongoing investigations by the Nevada and Massachusetts and the impending re-licensing process in Macau.

The company last month dropped all claims against Okada in a lawsuit stemming from his 2012 dismissal from the board, with Wynn Resorts identifying the Japanese gaming mogul at the time as an “unsuitable Person” amid allegations he provided improper hospitality at Wynn properties to Philippine gaming officials to the tune of US$110,000 in a bid to win favor for his Okada Manila project.

It also reached a US$2.6 billion settlement agreement with Okada’s former companies Aruze USA and parent Universal Entertainment relating to the forced redemption and accrued interest. Okada was dumped from the Universal board in 2017 after the company discovered evidence of fraud.

The litigation just settled between Steve and Elaine Wynn had specifically related to the validity of the Stockholders Agreement, which had granted Steve Wynn voting control of Elaine Wynn’s 9% stake. The forced redemption of Okada’s shares saw Elaine Wynn claim the Stockholders Agreement was no longer valid and she took the matter to court in 2015 after losing her seat on the board – a fact she attributed to her having approached Wynn Resorts and Ms Sinatra specifically over Steve Wynn’s behavior.

Wynn Resorts said in this morning’s filing that “neither the company nor Ms Sinatra made any payment,” in relation to the settlement announced today.

But it also begs the question: what now for Steve Wynn? For the first time in many years he is not fighting for his business in the courts, although he still faces proceedings as a result of sexual misconduct allegations. He has no hotel or casino to run. He’s 76 years old and has been legally blind for eight years due to ongoing retinitis pigmentosa.

He has nothing left to prove, but if he did, he has nothing left to prove it with. Except a big pile of cash.

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