Nevada Regulators Lost a Round to Steve Wynn in Legal Fight; Appeal Filed

Article by : Helen Dec 14, 2020

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It looks like Nevada gambling regulators are in over their heads when it comes to the former Las Vegas casino mogul Steve Wynn. At least, this is the gist of the Clark County District Court’s recent ruling: it found Nevada Gaming Control Board’s recommendation to ban Wynn from returning to the gambling industry forever overreaches the regulators’ jurisdiction as he is no longer involved in the casino business.

Steve Wynn once was arguably the biggest name in Nevada’s casino industry – after all, he is the man behind some of Las Vegas’ most famous casinos: Treasure Island, The Mirage, Bellagio, and Wynn Las Vegas. He also co-founded Wynn Resorts with his now ex-wife Elaine Wynn and acted as its chairman and CEO.

It all came to an end in 2018, after dozens of women brought the accusations of sexual misconduct forward. In light of this development, Wynn resigned from the company to protect its reputation and sold his shares while denying any wrongdoing. However, his bottom line seems to be just fine without being involved in the casino anymore – he made it to the Forbes 400 2020 list, and his net worth remains at $3 billion.

Apart from cutting ties with Steve Wynn, Wynn Resorts had also to deal with financial penalties: the Nevada Gaming Commission fined the casino operator $20 million for “failing to investigate claims of sexual misconduct made against Wynn before he resigned.” Wynn Resorts also had to pay $35 million in fines in Massachusetts, where the state gambling regulators weren’t informed of sexual misconduct allegations against Wynn when the company was applying for a license to develop a casino in the Boston area.

However, the company also received $20 million from Wynn himself “in damages” and an additional $21 million from insurance companies, without any admission of wrongdoing. The money was used to “settle shareholder lawsuits accusing company directors of failing to disclose misconduct allegations.”

Following the outfall of the sexual misconduct scandal, Nevada Gaming Control Board found Wynn “unsuitable to be associated with a gaming enterprise or the gaming industry as a whole” and unanimously decided to recommend the state’s Gaming Commission to place a lifetime ban to reenter the casino industry on him at the end of 2019. It was also considering to fine him half a million dollars. This is where Wynn’s attorneys got into the mix and took to the court to protest the Nevada Gaming Control Board’s decision.

Because Petitioner has no material involvement, directly or indirectly, with a licensed gaming operation, this Court finds that Respondents have no jurisdiction to impose discipline or fines against Petitioner.

Nevada gambling regulators don’t seem to give up on their endeavor to make sure Wynn stays away from the state’s gambling industry. On December 2, Nevada Gaming Control Board unanimously decided to take the dispute to the state’s supreme court and file an appeal for the Clark County District Court’s decision. The Nevada Gaming Commission is still considering its options and weighing in on the pros and cons of filing an appeal.

The Nevada Supreme Court has an underwhelming track record of accepting appeal cases: it took up just 2.7 percent of petitions sent its way in 2019. So, if the Nevada Gaming Control Board does file an appeal case, there is no guarantee the Nevada Supreme Court will decide to hold hearings on it.