WYNN VS. OKADA:
Wynn: Okada misappropriated trade secrets, made false claims
Aaron Mayes / Las Vegas Sun
See the lawsuitWynn v. Okada
VEGAS INC and Sun archives
- Okada plans legal showdown with Wynn over share redemption, bribery charges(Feb. 20, 2012)
- Wynn exec Okada sues to see company’s books in spending dispute (Jan. 11, 2012)
- Wynn joining forces with Okada (June 25, 2002)
- More gaming news
The new Wynn Resorts Ltd. lawsuit against board member Kazuo Okada includes new, detailed allegations, including claims Okada misappropriated Wynn trade secrets for his own use.
The suit, filed over the weekend, was made public Tuesday when Clark County District Court in Las Vegas opened after the three-day holiday weekend.
The lawsuit is based partly on the Freeh Report, named for an investigatory report Wynn Resorts had former FBI Director Louis Freeh’s company compile.
The suit says Wynn Resorts had been considering investing in a Philippines casino resort with Okada, but any consideration of the plan ended when the Wynn board of directors determined in February 2011 that "involvement in the Philippines was inadvisable" due to problems there — including that "official corruption in the Philippine gaming industry is deeply ingrained."
Okada had arranged for Wynn Resorts CEO Steve Wynn to meet with Filipino President Benigno Aquino about a casino deal in that nation, but Steve Wynn’s participation was canceled on the advice of the Wynn board, leaving Okada "embarrassed and angry."
Okada continued to pursue development of a resort in the Philippines, made false claims Wynn Resorts had endorsed or was affiliated with the effort and planned the casino to directly compete with Wynn Macau in China, the suit says.
"To promote his own interests, Okada launched a campaign to misappropriate Wynn Resorts’ assets and secrets for his and his affiliates’ use," the suit says. "Among other things, Okada arranged to have several people serve as interns at the Wynn Macau property so that Wynn Macau 'know how' could be learned and siphoned from Wynn Resorts."
The suit includes previously reported allegations that Okada had made improper payments and provided gifts to foreign gaming regulators, which Wynn Resorts considers a violation of the U.S. Foreign Corrupt Practices Act.
Attorneys for Wynn Resorts are seeking a court declaration that the company acted lawfully and in compliance with its Articles of Incorporation in redeeming Okada's $2.7 billion in shares at a discount for a $1.9 billion, 10-year note. They also contend Okada and his companies Aruze USA Inc. and Universal Entertainment Corp. committed a breach of fidiciary duty.
The lawsuit also seeks disgorgement of profits Okada may have earned related to his conduct and unspecified damages including punitive damages.
Law firms representing Wynn are Pisanelli Bice PLLC in Las Vegas, Wachtell, Lipton, Rosen & Katz LLP in New York and Glaser Weil Fink Jacobs Howard Avchen & Shapiro LLP in Los Angeles.
Attorneys at two more firms with Las Vegas offices — Gordon Silver and Brownstein Hyatt Farber Schreck LLP — have also been advising Wynn on the company's dispute with Okada.
Okada, who is represented by his own heavyweight law firms, including Lionel Sawyer & Collins in Las Vegas and Alston & Bird LLP in Menlo Park, Calif., is expected to fight back against the Wynn lawsuit and Wynn’s redemption of his shares.
Okada already is suing Wynn Resorts in an effort to get the company to open its books and records about Okada’s investment in the company as well as its $135 million donation pledge to the University of Macau.