Legal Maneuver:Steve Wynn Sues MGC, Wynn Resorts Over Public Investigation Rollout

November 18, 2018
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Former Wynn Resorts CEO Steve Wynn has filed a six-count action in Clark County, Nevada, court calling on the Massachusetts Gaming Commission (MGC) to be barred from publicly rolling out its eight-month investigation into sexual misconduct allegations at Wynn Resorts – a highly anticipated investigation that was supposed to be made public in early December.

Wynn filed suit against the MGC and Wynn Resorts on six counts for allegedly violating his attorney-client personal privilege in handing over documents that were part of court cases when he was part of the company.

Steve Wynn resigned from the company in February and he was deemed a non-qualifier in the Wynn Resorts Massachusetts gaming license in May.

“Because the stated position of Mass Gaming and the continued silence of Wynn Resorts are tantamount to requiring Mr. Wynn to fight this privilege battle while blindfolded and with both arms tied behind his back, he now seeks relief from this Court to redress the breach of his common interest agreements with Wynn Resorts and to enjoin the public dissemination of Mass Gaming’s report to the extent it contains, discloses or otherwise relies upon Mr. Wynn’s protected communications and materials,” read the 20-page filing.

The MGC issued a statement late last week regarding the newly-filed case, saying it was Steve Wynn’s latest legal maneuver.

“The MGC is aware of Steve Wynn’s latest legal maneuver,” said Spokesperson Elaine Driscoll. “This development is not surprising as it is consistent with his established litigious tendencies. The Commission has retained legal representation in Nevada to mount a vigorous defense against his effort to block the release of our months-long investigatory report and to defend against Mr. Wynn’s baseless claims for damages against the Commission and its Director of the Investigations and Enforcement Bureau. It is our intention to bring this matter to a swift resolution. The IEB remains focused on its preparations to soon present the Commission with the full extent of its findings.”

Driscoll’s statement seemed to indicate the MGC believed they would still be able to hit the December timeframe for beginning to release the report, which has been delayed several times over the past few months.

Steve Wynn’s claim indicates the problem goes back to the Okada/Azure litigation that began in 2012, and was settled in the spring of this year. He said there was an agreement in place, though not in writing, that his attorneys and the company attorneys would work in tandem in the litigation – which involved a dispute over the sale of stock.

Because of that alleged agreement, Wynn says many of the documents from that case turned over to the MGC by Wynn Resorts as part of the state investigation were privileged.

However, he wrote, he and his attorneys in Boston and Nevada were not able to review any of the submissions from Wynn Resorts, a matter that was brought up in a letter to Wynn Resorts in July.

The matter, Wynn wrote, was also brought up to the MGC as well, saying attorney-client privilege had likely been violated.

Finally, not long ago, Wynn’s attorney in Boston, Brian Kelly of Nixon Peabody, was able to review a small batch of submissions that the MGC provided.

Wynn alleges those reviews confirmed what he believes are attorney-client privilege breaches.

“Those documents confirm the Company has, in fact, improperly disclosed Mr. Wynn’s protected communications at the unrelenting behest of Mass Gaming officials,” read the filing. “Mass Gaming has announced its intention to issue a public report concerning the results of its investigation by early-December 2018.  Recognizing that they have conducted their months-long investigation into Wynn Resorts with total disregard for protecting the privileged communications of Mr. Wynn—who, again, has no ability to determine what communications and materials have been provided to regulators—Mass Gaming officials have simply donned the judge’s robe, cracked the gavel, and unilaterally determined that Mr. Wynn has failed to sustain his burden of establishing that any privilege applies to the unknown universe of documents acquired during the Mass Gaming investigation.”

Wynn even alleges that MGC Investigator Karen Wells violated several privileges while questioning witnesses in Nevada during the inquiry. He said he learned this from individuals that were questioned, and informed the MGC of this allegation on Oct. 23.

“Mr. Wynn also notified Mass Gaming that he had learned…that Ms. Wells, a licensed attorney, had repeatedly posed questions during the interviews that sought to invade Mr. Wynn’s personal privileges,” read the filing. “Ms. Wells was of the apparent belief that she could invade Mr. Wynn’s privileges because Wynn Resorts had purportedly waived all of its privileges. The attorney representing the interviewees specifically noted the impropriety of such questioning without a waiver by Mr. Wynn (which had never been provided), objected thereto, and instructed the witnesses not to answer despite Defendant Wells’ objections to the instructions.”

The suit, in total, asks Wynn Resorts to stop turning over documents to the MGC that could be protected without first consulting Steve Wynn or his representatives. It also calls for the court to prevent the public rollout of the MGC investigation in December until the privilege questions are settled.