LAS VEGAS, April 5, 2016 /PRNewswire/ -- Supporting documents have been filed with the Nevada Clark County Court on behalf of Elaine Wynn, co-founder of Wynn Resorts (NASDAQ: WYNN) (the "Company") and one of the Company's largest shareholders, in conjunction with her amended complaint against Stephen Wynn, the Company's Chairman and CEO, Kimmarie Sinatra, the Company's General Counsel, and Wynn Resorts, Limited. The amended complaint charges Mr. Wynn, aided and abetted by Ms. Sinatra, set a tone at the top of the Company that has given rise to years of unchecked business activities and reckless behavior within the Company. The amended complaint asserts that the Board of Directors was intentionally kept in the dark by Mr. Wynn and Ms. Sinatra and, as a result, failed consistently to apply appropriate corporate governance standards. Only once – in all of its meetings over a 14 year period -- did the Wynn Resort's Board reject Mr. Wynn's so called recommendation, and that was when he engineered Elaine Wynn's ouster from the Board.
The supporting documents include sworn deposition testimony by certain Wynn Resorts Directors, filed but with redactions pursuant to the Court's Protective Order. Among the redacted excerpts of deposition testimony filed are those of Wynn Resorts directors Governor Robert J. Miller, D. Boone Wayson and Dr. Ray R. Irani.
As noted in Ms. Wynn's motion for leave to amend filed in conjunction with these supporting documents, "…depositions that have been taken in recent weeks--consisting mostly of Wynn Resorts Directors--revealed new facts that were not previously disclosed to Ms. Wynn…And while Ms. Wynn did not have access to those facts until the other Directors recently were deposed, no one on Mr. Wynn's side can claim to be surprised by Ms. Wynn's amended allegations; Mr. Wynn and Wynn Resorts are far more familiar with the threat the Company faces from the pattern of misconduct detailed in the amended pleading than Ms. Wynn…who was ousted from her Director position for asking too many questions about the Company's governance and losing the favor of the controlling shareholder."
The motion notes: "Mr. Wynn will be hard pressed to point to a single one of Ms. Wynn's new allegations as to which he does not have far more access than she…As of the filing of this motion, only nine depositions have been taken, and more than 20 are presently scheduled…The Directors of Wynn Resorts in particular have recently begun to collect and produce documents on their own behalf…Now that discovery has finally begun, startling admissions by Wynn Resorts Directors disclosed new facts…"
In her filings, Ms. Wynn makes clear that she did not raise these claims earlier because she repeatedly sought to raise them internally, and only after being rebuffed time and again, and then ultimately ousted from the Board entirely, was she forced to acknowledge that legal resolution of all of her claims was the only solution. Among other things, as the amended complaint acknowledges, she sought information on how decisions were made as to what was disclosed to the Board, and was squarely rebuffed by Ms. Sinatra; she requested the right to attend Audit Committee meetings and was denied that right (and documents were then shredded); she repeatedly raised issues about Marc Schorr, who Mr. Wynn was forced to fire; she voted against Mr. Schorr when he was elected to the Board; and raised issues as to the level of corporate expenditures. She was anything but silent when she was a Board member. As the amended complaint explains, Ms. Wynn had believed that "the issues plaguing the operation of Wynn Resorts and the reckless risk-taking of its Chairman and CEO Mr. Wynn could be addressed through proper corporate processes and channels."
The amended complaint continues: "Mr. Wynn has intentionally kept the Wynn Resorts Board in the dark and has turned the General Counsel of the Company into his co-conspirator. He has engaged in reckless, risk-taking behavior, leaving himself vulnerable to allegations of serious wrongdoing – that he made a multi-million dollar payment and used Company resources to silence and that he did not properly disclose to the Board of Directors. This and other such decisions have left the directors and the Company vulnerable to potential liability and regulatory exposure."
On March 28th, following the filing of Ms. Wynn's amended complaint, Mr. Wynn publicly stated that Ms. Wynn's amended complaint was nothing more than the ruminations of a disappointed ex-wife and that there would be a "comeuppance" for Ms. Wynn. Attempting to personally demean the concerns of Ms. Wynn -- one of the Company's largest shareholders -- speaks volumes about the head of this public Company. His contempt for his largest investors hardly bodes well for those with smaller stakes.
Steve Wynn also has claimed the Stockholders Agreement is necessary to protect against a change in control that could cause his involvement and unique expertise to be lost to the business. Yet he himself has already breached the Stockholders Agreement and misused it to stifle inquiry into the Company's weaknesses in controls. Even if Mr. Wynn is such an essential asset, as he purports to be, the unlawful Stockholders Agreement is unnecessary. No stakeholder in Wynn Resorts would intentionally destroy its value by eliminating his involvement.
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SOURCE Elaine Wynn