Dissident board member ordered to pay Wynn legal fees
21 August 2012
Wynn Resorts board member Kazuo Okada was ordered Tuesday to pay the company $148,583 in legal fees after a judge found he improperly tried to litigate a dispute in federal court.
Two lawsuits pitting Okada against Wynn Resorts and its other board members were filed in Clark County District Court in Las Vegas early this year. Okada's attorneys later moved one of the suits to federal court.
They claimed it was a federal issue because, in their view, the lawsuit centered on the Foreign Corrupt Practices Act (FCPA), a U.S. law that bars companies from bribing foreign officials.
Okada has suggested that Wynn Resorts made an improper donation to a university in the Chinese gambling enclave of Macau, while Wynn has claimed that Okada provided improper benefits to Filipino casino regulators.
Wynn insisted the lawsuit at issue didn't hinge on the FCPA but rather focused on Okada breaching his fiduciary duty as a Wynn director and potentially jeopardizing Wynn's crucial gaming licenses with his conduct.
U.S. District Judge Larry Hicks sided with Wynn during a June 21 hearing when he announced plans to send the suit back to state court.
On Tuesday, Hicks awarded the attorney's fees to Wynn to cover its costs in having the case sent back to state court. Hicks said in his order that Okada and his companies "did not have an objectively reasonable basis to remove this action to federal court.''
Tuesday's ruling means the existing litigation will continue in two lawsuits in state court, though Okada's attorneys have threatened to file a new suit in federal court alleging federal securities law violations. The suits cover allegations of wrongdoing leveled by both sides, as well as Wynn's forced discounted redemption of Okada's $2.7 billion in Wynn stock and efforts by the company to remove him from the board.
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