The morning after casino mogul Steve Wynn announced his departure as chairman and CEO from his self-named global gaming company, stock prices for Wynn Resorts surged. Wynn's exit followed allegations of sexual misconduct that came to light last month.
The Wynn Resorts’ Board of Directors said Tuesday night that it had accepted Wynn’s resignation and appointed Matt Maddox, currently president of the company, as its CEO, and Boone Wayson as non-executive chairman of the company’s board of directors effective immediately.
"It is with a collective heavy heart, that the board of directors of Wynn Resorts today accepted the resignation of our founder, CEO and friend Steve Wynn," Wayson said in a statement. "Steve Wynn is an industry giant. He is a philanthropist and a beloved leader and visionary. He played the pivotal role in transforming Las Vegas into the entertainment destination it is today. He also assembled a world-class team of executives that will continue to meet the high standards of excellence that Steve Wynn created and the Wynn brand has come to represent."
A Wall Street Journal article published in late January detailed what it described as a “decades-long pattern of sexual misconduct” by Wynn, including the allegations of a manicurist who said that Wynn forced her to have sex and a $7.5 million settlement later paid to her by Wynn. Bloomberg reported Friday that the settlement involved a paternity claim.
The Las Vegas Review-Journal reported the allegations of another woman who was a waitress at the Mirage and alleged Wynn, her boss, pressured her to have sex with him about 30 years ago. The woman, now 75, said she had sex with him on multiple occasions and did it willingly because she felt her job was at risk if she refused him.
In response to the allegations in the Journal article, Wynn said in a statement that the idea that he ever assaulted any woman was “preposterous.” The press release distributed Tuesday praised Wynn and did not include any admissions of misconduct.
"In the last couple of weeks, I have found myself the focus of an avalanche of negative publicity,” Wynn wrote in a statement. “As I have reflected upon the environment this has created — one in which a rush to judgment takes precedence over everything else, including the facts — I have reached the conclusion I cannot continue to be effective in my current roles. Therefore, effective immediately, I have decided to step down as CEO and Chairman of the Board of Wynn Resorts, a company I founded and that I love.”
Wynn vowed that the company will stay strong.
“The Wynn Resorts team and I have built houses of brick. Which is to say, the institution we created ... will remain standing for the long term,” he said.
But the situation already has triggered litigation. The Norfolk County Retirement System, which owns stock in Wynn Resorts, filed a lawsuit Wednesday in Clark County District Court against the company and its executives.
The 42-page complaint seeks redress from for losses sustained by Wynn Resorts as a result of “egregious breaches of fiduciary duty, abuses of fiduciary power and violations of law involving the Company” committed by Wynn. The shareholders also allege breaches of fiduciary duty by the Wynn Board of Directors and Kim Sinatra, who serves as the company’s executive vice president, general counsel and secretary, for turning a “blind eye” to Wynn’s pattern of conduct.
Officials from Wynn Resorts declined to comment on the lawsuit.
Publication of the allegations of assault have resulted in a swift fall from grace for Wynn, who resigned his post as finance chairman of the Republican National Committee after the allegations were published. The company’s stock price plummeted after the Journal article was published, falling at least 18 percent since then.
The Nevada Gaming Control Board, the Massachusetts Gaming Commission and Macau’s Gaming Inspection and Coordination Bureau all were in the midst of investigating the allegations of sexual misconduct against Wynn.
Nevada Gaming Control Board Chair Becky Harris says the board is continuing its investigation. It was not immediately clear how the Tuesday night announcement would affect the other probes.
Asked whether Wynn stepping down changes the course of gaming regulators' investigation, Nevada Gaming Commission chairman Tony Alamo said Wednesday morning that all he could say is that the board is investigating, that they're "methodical" but "nothing happens overnight."
"At the end of the day what is our responsibility? To make sure the industry, the people, the properties, the licensees follow the state statutes and regulations," Alamo said. "That’s what we do. "
Maddox, who replaces Wynn as CEO, served as the company’s president since 2013, and has worked at Wynn Resorts since 2002.
The company said details of the separation agreement with Wynn will be revealed when they are finalized.
Wynn's ex-wife Elaine Wynn, who is seeking control of her stock in the company in a lawsuit, declined to comment through a spokesman Tuesday night.
This story has been updated with new information and will continue to be updated throughout the day.
Disclosure: Wynn has donated to The Nevada Independent. You can see a full list of donors here.