Stay up-to-date with the latest developments in securities law through access to both news and all statutes and regulations. Find relevant corporate filings through a searchable EDGAR database. And...
Wynn Resorts Ltd. investors are suing the company and its directors in federal court over their failure to address the sexual harassment allegations that led to CEO Steve Wynn’s resignation earlier this month.
The Wynn Resorts board allegedly ignored “decades” of misconduct, damaging the company’s value and reputation, according to a Feb. 15 complaint in the U.S. District Court for the District of Nevada. Wynn’s fall came as a result of the #MeToo movement, which has helped expose workplace sexual harassment in corporate America.
Former employees repeatedly told the board about Wynn’s workplace sexual advances without the board taking any action, according to the complaint. Board members allegedly learned between 2009 and 2015 of a 2005 harassment settlement involving Wynn without taking action.
Wynn has denied the sexual harassment allegations. Wynn Resorts representatives didn’t immediately respond to a request for comment.
The board’s failure to investigate misconduct allegations against Wynn constitutes an intentional violation of its fiduciary duties, the complaint said.
The company’s stock dropped 10 percent when Wynn’s misconduct was publicly disclosed Jan. 26, and an additional 9.3 percent on Jan. 29, according to the complaint.
Wynn and the board’s actions exposed the company to significant liability, according to the complaint. Nevada and Massachusetts gaming regulators opened investigations into the allegations. At least two shareholder suits are pending in Nevada state court arising out of the same circumstances, filed Feb. 6 and 15.
The federal complaint seeks punitive damages, disgorgement of the board’s profits and compensation, and overhaul of Wynn Resorts’ corporate governance to prevent similar incidents.
The case is Broussard v. Hagenbuch , D. Nev., No. 2:18-cv-00293, complaint filed 2/15/18 .
To contact the reporter on this story: Jennifer Bennett in Washington at firstname.lastname@example.org
To contact the editor responsible for this story: Seth Stern at email@example.com
Copyright © 2018 The Bureau of National Affairs, Inc. All Rights Reserved.
All Bloomberg BNA treatises are available on standing order, which ensures you will always receive the most current edition of the book or supplement of the title you have ordered from Bloomberg BNA’s book division. As soon as a new supplement or edition is published (usually annually) for a title you’ve previously purchased and requested to be placed on standing order, we’ll ship it to you to review for 30 days without any obligation. During this period, you can either (a) honor the invoice and receive a 5% discount (in addition to any other discounts you may qualify for) off the then-current price of the update, plus shipping and handling or (b) return the book(s), in which case, your invoice will be cancelled upon receipt of the book(s). Call us for a prepaid UPS label for your return. It’s as simple and easy as that. Most importantly, standing orders mean you will never have to worry about the timeliness of the information you’re relying on. And, you may discontinue standing orders at any time by contacting us at 1.800.960.1220 or by sending an email to firstname.lastname@example.org.
Put me on standing order at a 5% discount off list price of all future updates, in addition to any other discounts I may quality for. (Returnable within 30 days.)
Notify me when updates are available (No standing order will be created).
This Bloomberg BNA report is available on standing order, which ensures you will all receive the latest edition. This report is updated annually and we will send you the latest edition once it has been published. By signing up for standing order you will never have to worry about the timeliness of the information you need. And, you may discontinue standing orders at any time by contacting us at 1.800.372.1033, option 5, or by sending us an email to email@example.com.
Put me on standing order
Notify me when new releases are available (no standing order will be created)