Nevada Supreme Court reverses ruling on Steve Wynn regulatory case

The Nevada Supreme Court has reversed a decision by a Clark County District Court judge that said state gaming regulators don’t have jurisdiction over former casino executive Steve Wynn after he left Wynn Resorts Ltd. on his own.

In an opinion issued Thursday, Supreme Court justices overturned the Nov. 19, 2020, ruling by Judge Adriana Escobar that determined that state gaming regulators do not have the ability to punish Wynn after his departure from the company.

The case will be remanded back to District Court with instructions to dismiss Steve Wynn’s complaint.

The procedural decision, outlined in a nine-page advance opinion signed off by the entire seven-member Supreme Court panel, in essence told Wynn’s legal team that it was premature in seeking a dismissal from regulators because they had not reached a final decision on whether Wynn should be disciplined.

Not a final order

In an opinion issued by Justice Abbi Silver, the court said, “We further conclude that the District Court properly determined that the commission’s order denying Wynn’s motion to dismiss is not a final order. As the order was not final, the District Court also lacked jurisdiction to consider Wynn’s petition as one for judicial review. … Therefore, we determine that the District Court erred by granting Wynn’s petition. Accordingly, we reverse the District Court’s order granting Wynn’s petition and remand this matter to the District Court with instructions to dismiss the petition for lack of jurisdiction.”

A legal expert explained that the Supreme Court’s ruling “is a procedural decision with real-world implications.”

“The Supreme Court isn’t deciding whether or not the commission has jurisdiction,” said Anthony Cabot, a distinguished fellow in gaming law at UNLV’s William S. Boyd School of Law.

“What they’re saying is that you decided that issue prematurely,” Cabot said. “It has to go back to the commission and the commission has to reach a final decision and then if you want to challenge the jurisdiction of the commission, you can do it at that time. You can’t do it now, it’s too early.”

Regulators happy

State gaming regulators were happy with the decision.

“The Nevada Gaming Control Board is pleased with the ruling,” Control Board Chairman Brin Gibson said Thursday. “We are reviewing the decision with legal counsel to determine next steps.”

A Las Vegas-based representative for Steve Wynn, who now lives in Florida, did not respond to phone and email messages seeking comment. Wynn contends he is no longer a public figure. A spokesman for Wynn Resorts said the company would have no comment on the case.

What happens next once Escobar dismisses Wynn’s complaint is up to the regulators. Cabot said the Control Board can present a complaint for consideration by the Gaming Commission.

Most complaints brought to the commission are settled by stipulation with a license suspension or revocation and fines possible. Since Wynn is no longer licensed and his attorneys have said he has no interest in returning to Nevada’s gaming industry, the question would then be whether regulators would try to impose a fine against Steve Wynn for damaging the state gaming industry’s reputation with his alleged actions.

“They’d then have to come up with some determination of what the discipline should be. Obviously it can’t be loss of license because he’s no longer a licensee,” Cabot said.

“The question then becomes if the board and commission decide to go forward with disciplinary action, how does Wynn’s legal team respond?” Cabot said. “Do they want to fight it or do they just not show up and fight jurisdiction later?”

When Escobar ruled on the case in November 2020, she said Steve Wynn’s departure from the company removed him from regulatory jurisdiction.

“Because (Wynn) has no material involvement, directly or indirectly, with a licensed gaming operation, this court finds that respondents have no jurisdiction to impose discipline or fines against” him, Escobar’s ruling said.

Wynn left in 2018

Wynn, the former chairman and CEO of Wynn Resorts Ltd., stepped down from his positions with the company on Feb. 6, 2018, and divested himself of all company shares he owned by March 22, 2018.

Wynn left the company after published accusations that he made unwanted sexual advances to female Wynn Resorts employees and sexually assaulted several women. Steve Wynn has denied any improprieties.

The Nevada Gaming Commission fined Wynn Resorts a record $20 million on Feb. 26, 2019, for failing to adequately oversee and act on complaints women took to the company.

The Massachusetts Gaming Commission also fined the company $35 million on April 30, 2019, after a three-day adjudicatory hearing in Boston. At the time, the company was preparing to open Encore Boston Harbor in Everett.

The Massachusetts commission no longer recognizes Steve Wynn as a “qualifier” — an executive licensee — and did not pursue any disciplinary action against him. Massachusetts commissioners ultimately allowed the company to open its resort there where Encore is the state’s largest gaming revenue producer.

Since then, Wynn Resorts revamped its board of directors and instituted new procedures for filing complaints that executives are required to investigate. The company also named Matt Maddox as CEO after Wynn resigned. Maddox has since left the company, and former Wynn Chief Financial Officer Craig Billings took over as CEO on Feb. 1.

The Gaming Control Board filed its complaint against Steve Wynn over his suitability as a gaming licensee on Oct. 14, 2019, a year and a half after he had divested himself from the company.

Prior to that hearing, Wynn’s attorneys tried to negotiate a settlement with regulators in which he would agree not to seek any involvement in the Nevada gaming industry in the future, despite his position that he believed regulators had no jurisdiction over him.

Wynn was the developer of The Mirage, Treasure Island and Bellagio as well as Wynn Las Vegas and Encore Las Vegas and also once owned downtown Las Vegas’ Golden Nugget. He has been credited with moving Las Vegas into the city’s megaresort era beginning in the late 1980s.

Contact Richard N. Velotta at rvelotta@reviewjournal.com or 702-477-3893. Follow @RickVelotta on Twitter.