In a landmark move that has reverberated across the expanse of corporate America, the storied gaming entity, Wynn Resorts, along with some of its former executives has embarked on a journey to reconcile the alleged concealment of their founder, Steve Wynn’s sexual indiscretions. A sum as grand as $70 million has been pledged in reparation to investors, a clarion call for accountability from the corporate echelons. Of that fund, a notable $9.4 million will hail directly from the defendants’ pockets, while insurance benefactors have agreed to shoulder the remainder.
The drama of this corporate misadventure unfolded earlier this week when the legal troopers at Pomerantz LLP took to the podium, requesting the United States District Court for the District of Nevada to grant the preliminary nods of approval for the settlement’s commencement. Underpinning their motion was a securities fraud lawsuit that spun a narrative of deception stretching from March 28, 2016, to March 12, 2018.
A cunning shroud of silence, erected by the once-trusted executives, blanketed the unsavory truths of Mr. Wynn’s sexual misconduct, the implications of which pinballed across the corporate sphere. “The complaint alleged defendants were aware of numerous allegations of sexual misconduct made against Wynn…” Pomerantz declared, shedding light on years of buried allegations, vigorously denied and meticulously obscured from the public eye.
Steve Wynn, in a twist of cruel irony, became the face that launched the “Me Too” movement’s siege on corporate impunity. A salvo fired by the Wall Street Journal in January 2018, purportedly inspired by Wynn’s former spouse, laid bare the gaming mogul’s transgressions, ultimately scripting his fall from grace and exit from the empire he erected.
As tales of high-stakes courtroom action go, shareholder class action suits are often met with the steel trapdoors of judicial pragmatism, which frequently consign them to oblivion, citing the inherent risks investors take. However, when the usual risk is compounded by executive malfeasance, justice’s scales can tip quite differently. The gamble paid off for the plaintiffs as Wynn’s stock, which had soared during the period in question, crumbled under the weight of investigations, casting the die for a harsh retribution that bled the shareholders.
The tumultuous narrative continued with Massachusetts fining Wynn Resorts to the tune of $35.5 million, with the CEO succeeding Wynn, Matt Maddox, personally facing a $500,000 penalty. A tempest of rumors concerning the company’s prospects, including a potential forced sale of the Encore Boston Harbor, swirled and pummeled the stock’s value. Maddox, alongside the likes of general counsel Kim Marie Sinatra and then CFO Stephen Cootey, found their names etched in the lawsuit’s annals, with Cootey now charting new waters with Red Rock Resorts.
“This case should serve as a warning…” pronounced a Pomerantz partner, underscoring the significant financial ramifications negligible on corporate integrity and accountability.
In a frenzied procession of litigation, the news of Wynn’s amends with investors trailed closely on the heels of an announcement that detailed an agreement with the Department of Justice. This would witness the gaming titan paying a staggering $130.13 million for its role in a long-running, unsanctioned money transfer saga at Wynn Las Vegas – the largest fine ever demanded from a single US gaming establishment.
In a bid to shore up its financial fortifications, Wynn has disclosed the sale of a mammoth $800 million in corporate bonds. The seam of this significant commercial activity will be directed towards extinguishing the looming debt that looms over the next year and to settling its account with the federal government, a formidable move by a titanic player within the theater of Las Vegas’s corporate gaming dominion.
