Given the sordid nature of so much of the Steve Wynn sexual harassment mess, it’s hard to call anything shocking anymore. It’s like an epic Stephen King ghost story that keeps scaring you until you’re just worn out.
After a steady drumbeat of ugly allegations, including a $7.5 million confidential settlement with a woman who he allegedly raped, Tuesday’s hearing between a new slate of Wynn Resorts executives and the Massachusetts Gaming Commission must have seemed almost tepid by comparison.
Wynn has consistently denied the allegations even as he retreated from the company he co-founded, sold his stock and saw his name yanked from the $2.6 billion casino resort project outside Boston.
Although parts are redacted, you don’t have to read between the lines of the commission’s nearly 200-page investigative report to see that the previous lineup of Wynn executives and board of directors heard their master’s voice and failed to do their duty to stockholders. But that’s not news, either, really.
Wynn Resorts 2.0 didn’t dispute the facts and conclusions contained in the report. Under Elaine Wynn’s leadership, it cleared the decks and signed off on a record $20 million fine by Nevada gaming regulators. The company was able to keep its gaming license in Nevada.
Prior to the three-day hearing, Wynn Resorts said in a statement that it had cooperated fully with gaming authorities throughout the process, provided thousands of pages of documents, and allowed full access to company executives. It called the report “a complete review of matters related to the company’s founder.” It added that it would share “detailed information regarding the swift and decisive actions the company took as soon as it became aware of the allegations against the founder.
“In summary, Wynn Resorts has changed from a founder-led organization to a global enterprise overseen by a capable, independent and accountable Board of Directors.”
What was surprising in the report?
In a 2017 deposition in an unrelated civil matter, Wynn claimed that in 2005 he was hustled by a company manicurist into having sex. Part of the deposition was included in the Massachusetts regulatory report. Nevada gaming regulators have used the word “rape” to describe the allegation that led to Wynn’s $7.5 million settlement with the woman.
Wynn called it extortion, but a price he paid to prevent bad publicity in the wake of the recent opening of his latest Las Vegas resort.
From the report: “No, I called my lawyer because I knew that I was … about to be the victim of extortion, and … my first impulse was to call a lawyer and see what my options were in response.”
“Along comes this gal who had a turn with me, obviously being advised on what to do,” Wynn said. “Anybody who is over 10 years old and knows what goes on in the world knows what happens next. The story gets sensational.”
Wynn went on to say that he would have preferred to fight the allegation.
“If it had been me personally, like this lawsuit, I would go for it. To hell with it. Take your best shot. But it was 90-odd days after the opening of the hotel. … As vicious, as rotten as the move was, as scurrilous, as lying – isn’t anybody on earth that can breathe that will ever think I can rape someone. Nuts. So in – in this context seven and a half million was not a significant number. And I paid it.”
Wynn also paid nearly $1 million to settle another case involving a company cocktail waitress. No word yet on whether he believes he was also victimized that time.
In the past year, company stock dropped substantially before climbing out of the fallout of the scandal. Union Gaming Group analyst John DeCree notes that a lot is riding on the Massachusetts decision.
“The burden of suitability will ultimately fall on the company,” he wrote ahead of the meeting. “Based on the company’s clear and decisive transformation, we believe current management should be able to adequately prove current suitability to keep the license and open the property. However, if the commission determines the company is unsuitable (even after appeal), and Wynn is required to vacate its license, we envision a trustee to oversee the opening of the property and an orderly sale process.”
If the Massachusetts commission determines the company is unsuitable, its stock will soon be available at Dollar General.
No one reasonably expects Massachusetts to force the sale of a company that has made obvious strides to scour its corporate culture in the #MeToo era. It does, however, serve as a reminder that, as the facts have emerged from multiple investigative bodies, there will be no room for error in the future. Nor should there be.
Wynn Resorts 2.0 has undergone substantial and credible changes to its corporate character. It more than cleaned house when its namesake departed and was swiftly followed by most of his hand-picked board of directors. Whether out of a survival instinct born of desperation, or out of a genuine interest in forcing the evolution of the chauvinistic caveman culture present at the top of the corporate pyramid, a long list of enlightenments and improvements were made.
The record fine in Nevada gave Massachusetts casino authorities an opportunity — and the necessary political cover — to do the right thing and let the company go ahead and prove itself in the marketplace. We’ll see whether that happens, but the signs are right.
When a casino outfit hires a former Boston police commissioner to lead an independent committee to investigate all claims of sexual harassment inside the company, you know it’s trying to show how seriously it takes the issue.
As Boston University business law and ethics professor Kabrina Krebel Chang told CBS News, “That sends a message that you’re not going to tolerate enablers. That being silent is going to come back and haunt you.”
Maybe, just maybe the haunting is over at Wynn Resorts.
Contact John L. Smith at jlnevadasmith@gmail.com. On Twitter: @jlnevadasmith.
