A shareholder lawsuit accusing Wynn Resorts management of deceiving investors by failing to disclose Steve Wynn’s alleged sexual misconduct can proceed.
US District Judge Andrew P. Gordon of the District of Nevada granted the plaintiffs’ motion for class certification. The judge appointed Pomerantz as lead class counsel and Muehlbauer Law Office as local/liaison counsel.
This securities fraud class action arises from Wynn Resorts Limited’s alleged concealment of a long-running pattern of assumed sexual misconduct. The founder of the famous Las Vegas, Nevada casino Wynn Resorts, Stephen Wynn, is accused of forcing female employees to perform sex acts.
Pomerantz wins class certification
In appointing Pomerantz as Lead Counsel, Judge Gordon stated: “Counsel is experienced in handling securities class actions and is familiar with applicable law, as shown by both their prior experience and their filings in this case.”
Murielle Steven Walsh, the Pomerantz Partner who leads the litigation, also noted:
“We are gratified that the court granted our certification motion. Plaintiffs will now be proceeding with merits discovery into the alleged misconduct by Stephen Wynn against Wynn’s female employees and the enabling actions by Wynn management that allowed it to go on for years. This case continues to demonstrate that corporate integrity and accountability are important issues to investors.”
Pomerantz LLP is a renowned corporate, securities, and antitrust-class litigation firm. The company has offices in New York, Chicago, Los Angeles, London, Paris, and Tel Aviv.
The alleged misconduct first came to light in January 2018
Wall Street Journal was the first to reveal numerous Wynn employees’ complaints concerning misconduct by Steve Wynn. The WSJ published the article “Dozens of People Recount Pattern of Sexual Misconduct by Las Vegas Mogul Steve Wynn” in January 2018.
The story explained how Wynn had forced several Wynn Resorts female employees to perform sex acts on him. The article also revealed a $7.5 million settlement the company paid to one employee who was forced to have sex with Wynn.
Wynn, who had to resign as chairman and CEO, has always denied the allegations. Wynn Resorts had to replace the management that had allegedly covered up Wynn’s alleged misdeeds.
Gaming regulators promptly investigated the case. They confirmed that the Wynn Resorts board had repeatedly turned a blind eye to allegations regarding Wynn’s conduct. The suit also named the company’s C-level executives, including former CEO Matt Maddox and current CEO Craig Scott Billings.
They, among others, failed to investigate reports of sexual assault.
After the Wall Street Journal article, Nevada casino share price fell 10%
After the Wall Street Journal’s article, the Massachusetts Gaming Commission (MGC) announced a regulatory review of the company. Wynn’s share price fell approximately 10% or $20.31 in a day.
Massachusetts regulators penalized Wynn Resorts $35 million for not disclosing the allegations. The MGC also fined Wynn for the existence of the $7.5 million settlement. But it allowed the company to keep its license.
At the time, Wynn was building the $2.4 billion Encore Boston Harbor in Everett, Massachusetts.
