As controversies mount, Universal loses defamation suitBy John L. Smith, CDC Gaming ReportsAugust 7, 2017 at 7:41 amThose who have watched the unraveling of Kazuo Okada’s world with a cringing sense of wonder are not alone. Each month seems to bring more bad news for the Japanese slot king.Those who have anticipated Okada’s dramatic legal setbacks would eventually reach a tipping point may have found their wait is over.Okada, whose business acumen in an extremely competitive market has made him a multibillionaire, was once one of the gaming industry’s great success stories. Not only had he founded Universal Entertainment Corp. and built it into a worldwide brand, but he was on the ground floor of casino mogul Steve Wynn’s corporate reinvention with Wynn Resorts.All that is in the past now as Okada fights legal and corporate battles on multiple fronts and Universal’s board works to keep its ship from taking on water. This past week, the image of creator and company took another hit when Universal lost a defamation suit in Tokyo District Court against a former executive who went after the company for wrongly accusing him of helping to assist a questionable $10 million transfer in 2010, Reuters reports. That’s back when Okada was busy buttering up Philippine gaming officials in his successful attempt to win licensing and curry favor. That $10 million transfer is part of what has drawn federal law enforcement in the U.S. to scrutinize the Philippines deal.The judge ruled that Universal defamed its former executive, Takafumi Nakano, in a 2013 news release by tying him to the suspicious $10 million transfer. Nakano fought back and won vindication and approximately $27,000 in damages for mental suffering.Nakano’s lawyer hoped for a more sweeping victory — Okada was not found personally liable in the defamation action — but offered, “While I am disappointed in some aspects of the ruling, I am very pleased the court found that Chairman Okada ordered the $10 million transfer.”It was, the news service reported, part of the $40 million Universal, under Okada’s leadership, moved into the hands of a Manila consultant with ties to the Philippine Amusement and Gaming Corporation in 2010. That association sparked interest from the Federal Bureau of Investigation.Okada’s continuing legal saga and corporate meltdown have not only made headlines back in Japan, but also have generated an investigation by Nevada’s Gaming Control Board. Calling Okada or Universal forward for a public hearing would be a further humiliation that could potentially devastate the publicly traded company.Okada’s controversial decision to pursue a megaresort casino development in the Philippines led to the forced sale of his ownership stake in Wynn Resorts and, more recently, his ouster from the boards of Universal and its Manila casino subsidiary.Universal itself responded to intense press scrutiny of the Philippine casino development by unsuccessfully suing Reuters, which had first reported the multimillion-dollar payments, in a case thrown out by Japan’s Supreme Court.Some suggest that the potential for trouble with Nevada regulators and licensing authorities in other jurisdictions is another reason why Universal moved in recent weeks to distance itself from Okada. In its public statements, the company has made its intention to draw a hard line with its former chairman quite clear.Although no federal criminal charges have been filed in association with the Okada-Universal saga, at some point regulators sensitive about maintaining the credibility of the licensing process may be moved to act.Has that time finally arrived?John L. Smith is a longtime Las Vegas journalist and author. Contact him at email@example.com. On Twitter: @jlnevadasmith.