65°F
weather icon Clear

Nevada regulators in uncharted waters in Steve Wynn suitability case

Updated October 15, 2019 - 9:04 pm

It could take months for regulators to determine Steve Wynn’s suitability to continue to hold a gaming license in the wake of a complaint filed Monday.

State gaming regulators are in uncharted territory, testing areas of regulation they’ve never used before as they consider whether Wynn, the man credited with helping to reinvent Las Vegas in the 1980s and ’90s, should be stripped of his license.

Experts who have studied the city’s history say there’s really no precedent to the downward spiral Wynn’s case has taken. They’ve noted some comparisons with other leaders in the city’s past, but nothing like this.

“It really is unprecedented that somebody at that level with that history in the industry, having that outcome,” said David Schwartz, former director of UNLV’s Center for Gaming Research, who has written extensively on the casino industry and its history.

Wynn, 77, the former chairman and CEO of Wynn Resorts Ltd., was accused by the state Gaming Control Board of harassing multiple female employees for years. The five-count complaint signed by Board Chairwoman Sandra Morgan and members Terry Johnson and Philip Katsaros was delivered after the completion of a seven-month investigation that included interviews with victims, reviews of lawsuits filed against Wynn and the examination of 300 news articles about Wynn and his alleged harassment.

Telephone calls to Wynn’s attorney were not returned Tuesday. Wynn has repeatedly denied ever harassing anyone.

Statutes explain process

Nevada Revised Statutes and the Control Board’s Regulation 7 govern the procedure for disciplinary hearings for gaming licensees.

While the process is relatively clear, what’s unclear is Wynn’s status as a licensee subject to disciplinary action. Regulators say he is; Wynn says he isn’t.

Statutes say a complaint must be a “written statement of charges which must set forth in ordinary and concise language the acts or omissions with which the respondent is charged.” It also must say which statutes or regulations were violated and the complaint does that.

Once a complaint is filed, the commission is required to serve a copy personally or through registered or certified mail to the respondent.

Within 20 days — by around Nov. 3 — the respondent must state in short and plain terms the defenses to each claim asserted, must admit or deny the facts alleged in the complaint and must state which allegations the respondent doesn’t know about.

The regulation says those allegations are deemed denied. Regulations say failure to demand a hearing constitutes a waiver of the right to a hearing and to judicial review of any decision or order of the commission, but the commission may order a hearing even if the respondent waives the right.

If a respondent doesn’t show up for a hearing, it’s considered an admission of all facts alleged in the complaint, and the board may take action on that admission.

But Wynn may have another option, and experts with knowledge of the process, who spoke on the condition of anonymity, disagree over whether it would happen.

One expert says Wynn has the right to judicial review, meaning he could petition a court for an injunction to put the brakes on any action.

That, in essence, is what Wynn did when the Massachusetts Gaming Commission was attempting to complete an investigation for an adjudicatory hearing to determine if Wynn Resorts was suitable for licensing prior to the opening of Encore Boston Harbor nearly a year ago.

Wynn’s actions temporarily blocked his former company’s ability to complete the hearing until weeks before the scheduled opening of the resort in suburban Boston.

Another expert says that strategy worked because Massachusetts law is different from Nevada’s, where an appeal to the court system can occur only after the board has rendered a decision. In Massachusetts, Wynn was able to escaped that commission’s discipline when it was determined that he was no longer a qualified licensee.

In Nevada, the Control Board determined Wynn was among 10 former Wynn Resorts employees who had their licenses placed on administrative hold, meaning they were still subject to regulatory scrutiny.

Wynn disputes that, based on his attorney’s comments to board investigators noted in the complaint. He offered to provide information to investigators in writing, but he refused to appear before them for an interview.

Not a ‘bona-fide licensee’

In the fifth count against Wynn, the complaint says “On Wednesday, Sept. 5, 2018, counsel for Mr. Wynn sent a letter to the Gaming Control Board claiming that Mr. Wynn was no longer a ‘bona-fide licensee’ and ‘remains willing to consider any and all written inquiries which will assist the (Gaming Control Board) in (its) investigation …’

“The letter further stated that because Mr. Wynn retained counsel with the intent to pursue defamation litigation related to the claims of Mr. Wynn’s unwelcome sexual conduct, Mr. Wynn ‘cannot be reasonably expected to waive any of his privileges except at the appropriate time and in the appropriate judicial forum,’ ” the complaint said.

The complaint noted that the Sept. 5, 2018, letter did not request Wynn’s excusal from an investigative hearing scheduled two days later. He failed to appear.

Investigators said they believed Wynn violated his company’s policies on sexual harassment and attempted to hide a $7.5 million settlement with one of his victims from the company’s board of directors.

Wynn Resorts was punished by both the Nevada Gaming Commission and the Massachusetts Gaming Commission with fines that totaled $55.5 million this year.

Steve Wynn stepped down as chairman and CEO in February 2018 and divested himself of all investment in the company a month later. If regulators revoked Wynn’s findings of suitability, he would effectively lose his license and likely would not be allowed to be licensed again in Nevada.

“Now, it’s in the hands of the commission, and I wouldn’t presume to know how they’re going to operate,” Schwartz said. “Certainly it would be a pretty momentous decision and a big statement either way.”

Michael Green, an associate professor in UNLV’s Department of History, said regulators have disciplined licensees in different ways over the years, but he can’t recall an executive of such high profile having his license revoked. He noted that Las Vegas philanthropist Ralph Engelstad was disciplined by the Nevada Gaming Commission in 1989 for bringing discredit to the state by staging birthday parties for Adolf Hitler. Commissioners fined Engelstad $1.5 million but didn’t revoke his license.

No ‘black book’ hearing

Green noted that Wynn isn’t being targeted as an addition to the state’s List of Excluded Persons, the so-called “black book,” because that’s generally reserved for mobsters and casino cheats.

“If you make that comparison, you have people who will tell you stories of the generosity of Engelstad and of Wynn,” Green said. “I looked at the current list of the ‘black book,’ and I thought about the last one and it’s not the same thing. You’re a mobster or you’re a cheater. That’s basically it. Those seem to be the only people they’ve determined to keep out. They have pulled some licenses over the years and some that they’ve told to get out or they would pull their license.”

Contact Richard N. Velotta at rvelotta@reviewjournal.com or 702-477-3893. Follow @RickVelotta on Twitter.

Don't miss the big stories. Like us on Facebook.
Business Videos
Vegas Changes Everything: Grandma - LVCVA ad
"Grandma" is a new television spot from the Las Vegas Convention and Visitors Authority prepared to entice visitors to come during the Thanksgiving and Christmas holidays. (Visit Las Vegas/YouTube)
Vegas Changes Everything: Chaos - LVCVA ad
"Chaos" is a new television spot from the Las Vegas Convention and Visitors Authority prepared to entice visitors to come during the Thanksgiving and Christmas holidays. (Visit Las Vegas/YouTube)
New allegations involved Steve, Elaine Wynn - VIDEO
The new allegations were presented Friday in a motion that included a 2018 affidavit, alleging former hairstylist Jorgen Nielsen tried to convince a friend to say Steve Wynn raped her and that she bore his son. The affidavit also included new allegations suggesting Elaine Wynn and Nielson orchestrated the assault scandal. (Renee Summerour/Las Vegas Review-Journal)
Fitness chain Life Time acquires former Sullivan Square site
Fitness chain Life Time has acquired the former Sullivan Square site in Las Vegas for $14 million. The southwest valley property, across the street from Ikea, is little more than a giant hole in the ground. (Bizuayehu Tesfaye/Las Vegas Review-Journal) @bizutesfaye
Fashion Outlets of Las Vegas in Primm outlet mall changing its name - VIDEO
Chad Dillow, co-owner of Step Right Up, is building his attraction at Prizm Outlets, which recently changed it name from Fashion Outlets of Las Vegas, in Primm. It will include 3D trick art, ax throwing, escape rooms and carnival-themed games. (K.M. Cannon/Las Vegas Review-Journal) @KMCannonPhoto
O.J. Simpson files lawsuit against The Cosmopolitan over TMZ story - VIDEO
A lawsuit filed Thursday alleges that The Cosmopolitan of Las Vegas defamed O.J. Simpson when hotel employees told TMZ he was kicked out of the casino “for belligerence” in November 2017. (James Schaeffer / Las Vegas Review-Journal)
Phil Maloof on selling his Palms Place penthouse.
Phil Maloof sold his 59th-floor penthouse at Palms Place. (Eli Segall/Las Vegas Review-Journal)
Bleutech announces Las Vegas land purchase deal
Bleutech Park Properties reached a purchase agreement for 210 acres at Las Vegas Boulevard and Cactus Avenue, project spokesman Tom Letizia announced Tuesday, Nov. 5, 2019 at a news conference at the M Resort. (Elizabeth Brumley/Las Vegas Review-Journal)
Stolen Dodge Challenger found, suspect arrested - VIDEO
A $250,000 custom-built Dodge Challenger was stolen on Oct. 30, 2019, just before it was to be displayed at the Specialty Equipment Market Association trade show in Las Vegas this week. The thief was found by an Nevada Highway Patrol trooper, who rammed the trooper's car with the Challenger and got away. The suspect was ultimately arrested and the car recovered. (Las Vegas Review-Journal)
Terbine's, a tech firm, decision to relocate business from Bay Area to Las Vegas
Terbine's, a tech firm, decision to relocate business from Bay Area to Las Vegas. (Bizuayehu Tesfaye/Las Vegas Review-Journal) @bizutesfaye
A walk through the historic Huntridge Theater in Las Vegas - VIDEO
The Huntridge Theater became a musical venue in 1992 and was a staging ground for groups on the rise and alternative superstars, from Smashing Pumpkins to Sarah McLachlan, the Deftones, Nine Inch Nails, Green Day and Fugazi. The venue has been closed since 2004. This video, taken on Oct. 31, 2019, shows what's left of the theater after 15 years. (David Guzman/Las Vegas Review-Journal)
MGM Resorts International looking to sell another property
MGM Resorts International is working to sell its MGM Grand property on the Las Vegas Strip. (Renee Summerour/Las Vegas Review-Journal)
Developer Sam Cherry reveals plans for shareDOWNTOWN.
Mayor Carolyn Goodman and Councilwoman Olivia Diaz will attend this event where plans are revealed for a future apartment complex in the Arts District. (Shea Johnson/Las Vegas Review-Journal)
Las Vegas Convention Center expansion update - VIDEO
Take a drive outside of the new Las Vegas Convention Center expansion project. (Severiano Galvan/Las Vegas Review-Journal)
Binion's debuts a spinning bar overlooking Fremont Street Experience - VIDEO
Binion's debuted its spinning bar inside the Whiskey Licker Up Saloon. The Rotating bar only goes at one full rotation per 15 minutes overlooking the Fremont Street Experience. (James Schaeffer/Las Vegas Review-Journal)
Day 3 of the 2019 Global Gaming Expo
Day 3 of the 2019 Global Gaming Expo took place at the Sands Expo and Convention Center in Las Vegas Wednesday, Oct. 16, 2019. (K.M. Cannon/Las Vegas Review-Journal) @KMCannonPhoto
Southern Nevada could set a new resale-price record in coming months.
The median sales price of previously owned single-family homes – the bulk of the market – was $310,000 in September. Before the economy crashed last decade, prices peaked in June 2006 at $315,000, according to the Greater Las Vegas Association of Realtors.(Bizuayehu Tesfaye/Las Vegas Review-Journal) @bizutesfaye
Walmart container park in Henderson - VIDEO
Henderson could be home to a container park associated with a Walmart Inc. initiative. (Las Vegas Review-Journal)
Recession lessons could help Las Vegas face next slump - VIDEO
While the last economic downturn had a dramatic impact on local casinos, most experts expect the industry will be better able to weather the storm during the next recession. (Mat Luschek / Las Vegas Review-Journal)
St. Rose Parkway Construction - Video
St. Rose Parkway continues to have construction along the six-and-a-half mile road. Review-Journal studio host Aaron Drawhorn and business reporter Eli Segall go over the construction projects that are coming to Henderson.
MGM and victims of Oct. 1 reach settlement agreement - VIDEO
MGM Resorts International and lawyers representing potentially thousands of victims of the Oct. 1, 2017, mass shooting on the Las Vegas Strip have reached a tentative settlement of between $735 million and $800 million. (Mat Luschek /Las Vegas Review-Journal)
Live music and EDM dominate the night on day 2 of A’Le’Innstock
After sunset bands rocked the crowds at A’Le’Innstock in Rachel, Nevada on the second night of the event.
iPhone 11 Release
Local Las Vegas long time Apple product consumer shares her excitement for the new iPhone 11 release Downtown Summerlin. (Elizabeth Page Brumley/Las Vegas Review-Journal)
Lihi Levin talks about a mobil app Dropit - VIDEO
Lihi Levin, regional manager at Dropit Shopping, talks about a mobil app Dropit. The app lets customers leave their shopping bags at a store then have them delivered the same day to their home or hotel so they can shop without carrying multiple bags all day. (Bizuayehu Tesfaye Las Vegas Review-Journal) @bizutesfaye
North Las Vegas company prepares for Mars - VIDEO
Robert Bigelow and his Bigelow Aerospace manufacturing facility played host to eight NASA astronauts and 60 engineers this week getting to know the company’s B330 autonomous, expandable space station. (Elizabeth Brumley/Las Vegas Review-Journal)
Las Vegas developer talks about a new apartment complex called “the yoU”
Frank Marretti lll, founder of G2 Capital Development, talks about his new apartment complex called “the yoU” near UNLV. (Bizuayehu Tesfaye/Las Vegas Review-Journal) @bizutesfaye
Steel cables will hoist roof at Allegiant Stadium - VIDEO
Stainless steel cables are being put into place at Allegiant Stadium to begin the process of putting the roof on the 65,000-seat stadium in Las Vegas. Stadium Chief Operating Officer Don Webb explains how the cables will be used to get the roof put on the future home of the Raiders and UNLV football. (Heidi Fang/Las Vegas Review-Journal)
The last remaining Sigma Derby game in Las Vegas
Derek Stevens, owner of the D Las Vegas, talks about the last remaining Sigma Derby horse racing game in Las Vegas inside his casino floor. (Erik Verduzco/Las Vegas Review-Journal)
Popeyes Spicy Chicken Sandwich Review
Janine Blake of Las Vegas gives her review of the new Popeyes Spicy Chicken Sandwich at the restaurant’s location on west Bonanza Road on Thursday, Aug. 22, 2019,
SuperZoo 2019 takes over Mandalay Bay in Las Vegas
SuperZoo 2019 show for pet retailers brought pet products of all description to the Mandalay Bay Convention Center in Las Vegas. (Heidi Knapp Rinella/Las Vegas Review-Journal)
THE LATEST