Elaine Wynn Seeks Whistleblower Protection after Accusing Wynn Resorts of “Securities Law Violations”

Posted on: October 11, 2016, 04:00h. 

Last updated on: October 12, 2016, 03:20h.

Casino.org Staff Writer Read More

Expertise: Commercial Gaming.

Elaine Wynn, the estranged ex-wife of casino mogul Steve Wynn, has applied for whistleblower protection in relationship to claims she has made of possible securities violations by Wynn Resorts Ltd.

According to a report by Bloomberg, Wynn petitioned the Nevada Supreme Court with the request after being refused protection by the Las Vegas trial judge presiding over her case against Wynn Resorts.

Wynn is suing her former husband in an attempt to wrest back control of stock in the multi-billion-dollar company they formed together in 2000.

The Wynns married in 1963, divorced in 1986, then remarried in 1991, before divorcing again in 2010. As part of their final divorce settlement, the couple split their stakes in Wynn Resorts evenly, and Steve Wynn agreed to always reelect his ex-wife to the board of directors. In return Elaine Wynn agreed to a provision that she wouldn’t sell her shares without her ex-husband’s permission.

Open to “Retaliation”

The divorce was initially amicable, but things turned sour in 2012 when Wynn Resorts sued its major shareholder, the Japanese billionaire Kazuo Okada, in order to oust him from the board forcibly, and redeem his 20 percent stake in the company.

Elaine Wynn filed a separate claim in the case in an attempt to extricate herself from the shareholders agreement barring her from selling her shares, worth some $900 million. This, said Steve Wynn, was not in the interests of the shareholders. He also argued that it relieved him of his obligation to reelect her to the board, and in April last year she, too, was ousted.

In her petition to the Supreme Court, Elaine Wynn said that she sent a letter to Wynn Resorts’ audit committee, as well as a third-party auditor, which “raised questions about the conduct of Wynn Resorts and its management that she reasonably believed violated federal securities laws,” although the exact nature of the alleged infractions are unspecified in court the documents.

She said the original trial judge’s refusal to grant her whistleblower protection leaves her open to “retaliation by Wynn Resorts and Steve Wynn.”

War of the Roses

Relations between Elaine Wynn and the company she co-founded have become increasingly acerbic since the court case. Wynn Resorts has claimed her case is “filled with lies and distortions” and is “an embarrassment,” and has labelled her a “disappointed wife.” Steve Wynn told the Wall Street Journal recently that she would “get her comeuppance.”

Elaine Wynn, meanwhile, has accused her former husband of indulging in “reckless, risk-taking behavior.”

“Our company takes its obligations under all federal laws very seriously and is frustrated when those laws and valid protections are twisted and used to pursue a personal agenda,” Michael Weaver, a spokesman for Wynn Resorts, told Bloomberg this week.