LOS ANGELES — Steve Wynn’s settlement with a former employee in 2005 was done privately, but the secret refuses to go away.
The casino mogul and his former wife, Elaine Wynn, have been battling over documents related to the employee’s allegations and a related settlement, which Elaine Wynn said was in the millions of dollars. Her attorneys are now placing that deal in the context of the larger debate over sexual harassment and corporate responsibility, which emerged following allegations against film producer Harvey Weinstein.
A spokesman for Steve Wynn called the efforts a “smear campaign” that is “not supported by the facts.”
Steve and Elaine Wynn, both 75, have been fighting for five years over her ability to control her $1.6 billion stake in Wynn Resorts Ltd., the operator of casinos in Las Vegas and Macau. An agreement she signed with Steve Wynn gives him the right to vote her nearly 9 percent stake in the Las Vegas company and limits her ability to sell her shares. Wynn, who lost his earlier casino empire, Mirage Resorts, to an unsolicited offer from Kirk Kerkorian in 2000, has sought to control as much Wynn Resorts stock as he can.
Elaine Wynn is arguing that her deal with her former husband is no longer valid after the company took back the stock of Kazuo Okada, a Wynn Resorts cofounder also party to their shareholder agreement.
Elaine Wynn escalated her efforts last year after losing her seat on the Wynn Resorts board in 2015, saying she was punished for raising questions about Steve Wynn’s “reckless” conduct running the company, including the handling of the 2005 settlement. She accused him of using company personnel and resources to conceal the allegations.
Details of what prompted the settlement are only hinted at in the heavily redacted court filings in state court in Las Vegas.
“At the end of the day this was simply a report of sexual harassment,” Mark Ferrario, one of Elaine Wynn’s attorneys, said at an August hearing. That same month she asked Steve Wynn for all documents “regarding any allegations of sexual misconduct made against you by a current or former Wynn Resorts employee.”
“Recent events in the media serve to highlight” that the incident was “not, as Wynn Resorts and Mr. Wynn have contended, a ‘personal’ issue,” Elaine’s attorneys said in an Oct. 19 court filing. “Such misconduct is a matter central to appropriate corporate governance.”
Among the materials the Wynns have been battling over are notes about what occurred in 2005, taken by the former head of hotel operations at Wynn Las Vegas, Doreen Whennen. The Nevada Supreme Court this month denied Steve Wynn’s bid to keep those notes out of Elaine Wynn’s hands. Days later, he sued Whennen, alleging breach of contract because she took the notes with her when she retired in 2014.
Wynn Resorts’ outside lawyers reviewed the settlement and determined it didn’t need to be shared with the board, according to comments made by Elaine Wynn’s lawyer at a Dec. 18 hearing. Her lawyers are trying — so far unsuccessfully — to gain access to communications between Steve Wynn and outside lawyers about the settlement.
Michael Weaver, a spokesman, said “any allegations that Mr. Wynn committed an alleged assault or harassment of any kind are completely false. There is substantial evidence that discredits such allegations.”
The company declined to provide the evidence, citing a confidentiality order by the court.
“It is noteworthy that although Ms. Wynn says she knew about these false allegations in 2009, she did not make them known to the board of directors (of which she was then a member) and she did not raise them until after Mr. Wynn remarried and the shareholders of Wynn Resorts voted not to elect her to the board,” Weaver said.
The Wynns’ lawsuit is scheduled to go to trial in April.