Former Wynn Resorts board member Elaine Wynn, the largest shareholder in the casino operator who has a two-year-old standstill agreement with the company, was unanimously recommended by gaming regulators Wednesday for suitability as an owner, despite refusing to answer questions about certain events surrounding the departure of her ex-husband as CEO and chairman.
Wynn, 78, who owns 8.84% of Wynn Resorts’ common shares, told the Gaming Control Board during a virtual hearing that she has no interest in rejoining the casino company’s board and would not attempt to influence company management.
“It’s a company I have great affection for, and I do like the name,” Wynn said, adding that she was satisfied devoting most of her time to educational efforts, serving as president of the Nevada State Board of Education, operating her charitable family foundation, and serving on other charitable boards.
The Nevada Gaming Commission will make a final decision on Sept. 24.
Forbes lists Wynn with a net worth of $1.8 billion and No. 11 on the list of America’s Self-Made Women in 2019
She signed the standstill agreement with the company August 2018 after longtime gaming executive Phil Satre became vice chairman of the company. Satre was named chairman two months later. Elaine Wynn had attempted to get Satre appointed to the board earlier in the year.
Elaine Wynn in April 2019
Wynn said she only discusses company issues with Satre, Wynn Chief Financial Officer Craig Billings, and property presidents. The standstill agreement would expire if Satre left as chairman. His term is up in 2021.
“We all wish we could have crystal balls right now, but I’m pleased with Mr. Satre’s leadership and I expect that will continue,” Wynn said.
Steve Wynn departure
The hearing became a bit testy when Control Board Member Phil Katsaros questioned Wynn about events surrounding the resignation of her ex-husband, Steve Wynn, as chairman and CEO in February 2018, a week after a Wall Street Journal article uncovered years of sexual misconduct and harassment allegations by Steve Wynn against employees. Steve Wynn has denied the allegations and sold all his stock in the corporation, which made his former wife the largest shareholder.
Attorneys for Elaine Wynn told the board said she had addressed issues surrounding her 2009 fiduciary responsibilities as a board member during a multitude of investigations in 2018 surrounding the charges against her ex-husband. One of the charges detailed in the Nevada Gaming Control Board’s 10-count disciplinary complaint against the company in 2019 involved the alleged 2005 rape by Steve Wynn of a Wynn salon employee who alleged she became pregnant as a result of the encounter. The employee reached a confidential settlement of $7.5 million.
Elaine Wynn reportedly found out about the settlement in 2009 while in the process of divorcing her husband and reported the matter to then-Wynn General Counsel Kim Sinatra. She recounted those details during a hearing in front of the Massachusetts Gaming Commission in 2019 when the company was seeking licensing for Encore Boston Harbor.
When pressed by Katsaros for an explanation on how she met her fiduciary responsibility as a board member, Elaine Wynn declined to answer.
“As you can imagine, this was one of the most painful chapters in my life,” Elaine Wynn said. “I’m not looking forward to revisiting this in another public forum. I respectfully decline (to comment).”
Nevada attorneys Mark Ferrario and Mike Alonso, representing Wynn, told the Control Board there was plenty of documentation regarding the matter in records submitted to the agency as part of her suitability application.
“Ms. Wynn followed every appropriate step. She contacted the general counsel,” Ferrario said. “To be perfectly blunt, that’s the place she should have gone, the general counsel to discharge her obligation.”
Changes to the company
After Steve Wynn’s departure, Elaine Wynn said she sought to “exercise some influence” after the “dramatic changes” in company leadership took place. “The future of the company and its reputation were important to me.”
Elaine Wynn sought election to a board seat, but abandoned the quest once Satre agreed to join the company.
In April 2018 the company added three women to its board – former White House press secretary Dee Dee Myers, three-time CEO Betsy Atkins, and Kestrel Advisors CEO Winifred “Wendy” Webb – who joined current board member Pat Mulroy, making Wynn among the top 40 S&P 500 companies for female board representation.
In 2019, Wynn Resorts added several new policies, many directed toward sexual harassment prevention. A compliance committee was created, and numerous procedures were introduced to prevent any harassment allegations from going unchecked.
The complaint by Nevada gaming regulators resulted in a state-record $20 million fine that Wynn Resorts paid in February 2019. The Massachusetts Gaming Commission fined the company $35 million after executives failed to disclose years of allegations of sexual misconduct against Steve Wynn.
Howard Stutz is the executive editor of CDC Gaming. He can be reached at hstutz@cdcgaming.com. Follow @howardstutz on Twitter.
