Caesars’ plans to convert corporations into LLCs recommended for OK
State gaming regulators have recommended approval of Caesars Entertainment’s plan to convert its operating and real estate corporations into limited liability companies.
The conversion, approved Wednesday by the state Gaming Control Board and expected to be reviewed by the Nevada Gaming Commission Aug. 25, would minimize the companies’ and Caesars creditors’ tax liabilities in the bankruptcy case that has been ongoing since January 2015.
The unanimously approved recommendation is for the amendments of registration for Caesars Entertainment Corp. and Caesars Entertainment Resort Properties and their subsidiaries.
The U.S. Bankruptcy Court in Chicago on June 22 granted approval to the conversion plan, which would benefit both the companies and creditors that have been negotiating the resolution of terms in the hard-fought bankruptcy action.
The action was part of two matters involving Caesars that included the recommended licensing of three executives, one of which led to extensive questioning by board members.
The board ultimately recommended licensing for senior vice president Scott Wiegand, who serves as corporate secretary and deputy general counsel for Caesars Entertainment Operating Co. and secretary for subsidiaries Desert Palace Inc. and Harveys Tahoe Management Co. in Stateline.
Board members questioned Wiegand for nearly an hour on his 2004 indictment following an investigation by the U.S. Department of Justice and the Securities and Exchange Commission of PurchasePro.com and its chief executive officer, Charles “Junior” Johnson.
Wiegand was acquitted of all charges.
Wiegand, who was senior vice president and general counsel of PurchasePro, was named in a 30-count indictment accusing six PurchasePro and America Online executives, including Johnson, of engaging in a scheme to artificially inflate revenue reported to the SEC through secret side deals, back-dated contracts and revenue swaps.
Wiegand was acquitted in a bench trial by U.S. District Judge Walter Kelley Jr. in January 2005. Prior to the trial, Wiegand had been hired by Harrah’s Entertainment, the predecessor to Caesars, and was given a six-month leave of absence by the company in 2004 for the trial. Because of the length of the court action, Wiegand was let go and was unemployed for a year, but he was rehired by Harrah’s in January 2006.
Wiegand told regulators the Caesars compliance committee was aware of the court actions and board members said they were satisfied to his honesty and integrity, but that an indictment of a licensing applicant always raises a red flag among regulators.
Wiegand is expected to be further scrutinized by the Gaming Commission later this month.
Contact Richard N. Velotta at rvelotta@reviewjournal.com or 702-477-3893. Find him on Twitter: @RickVelotta.
