The litigation surrounding Wynn Resorts Ltd. has gained another entrant.
The Louisiana Municipal Police Employees’ Retirement System, which holds Wynn Resorts stock, filed suit late Tuesday in U.S. District Court in Las Vegas asking not only for financial damages but a halt to any further donations to the University of Macau. The case was styled as a shareholder derivative action, where a shareholder sues on behalf of the company when it contends that directors and officers have not done their job of managing the company in the best interests of investors.
The case largely piggybacks on positions taken by Kazuo Okada, formerly the company’s largest shareholder through his Aruze USA Inc., that the company used a $135 million pledge to the university as a way to gain favor for expanding in Macau.
In addition, redeeming Okada’s stock at a steep discount and pushing him out as a board member is proving expensive to the company and allows chairman and CEO Stephen Wynn "to maintain virtually absolute control over the company he founded," the lawsuit alleges.
"The company’s goodwill and reputation have also been horribly damaged" by the public feud in which the board of directors has sided with Stephen Wynn.
A Wynn spokeswoman declined comment on the case. In the past, it has contended that Okada improperly influenced Phillippine officials when gaining approval for a casino resort there, going against the company’s interests and violating the company’s ethics standards.Louisiana investors join case against Wynn