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Wynn Resorts Ltd
Wynn Resorts Ltd. (WYNN) persuaded a U.S. judge to send its breach of fiduciary duty lawsuit against Kazuo Okada, the company’s former vice chairman whom it’s trying to remove from its board of directors, back to state court.
U.S. District Judge Larry Hicks at a hearing yesterday in Las Vegas granted Wynn Resorts’ request to remand the case to Nevada state court, where it was filed in February. In March, Okada had the case moved to federal court, arguing that the underlying issue was whether he had violated U.S. law by allegedly making improper payments to foreign officials.
“The judge’s ruling today addresses only the question of where the case should be heard, not the merits of the case,” Steve Getzug, a spokesman for Okada’s holding company Aruze USA Inc., said yesterday in an e-mailed statement.
“While we respectfully disagree with the court’s decision, we’re quite confident that a jury, no matter where it is seated, will agree that Wynn Resorts CEO Steve Wynn and his dutiful Board of Directors unlawfully stripped Aruze USA of its leadership stake in the company without any legitimate justification and to silence a vocal critic,” Getzug said.
The lawsuit is part of the battle between Steve Wynn, the Las Vegas-based company’s founder and chairman, and Okada, the Japanese billionaire who helped bankroll the casino operator 12 years ago. Wynn Resorts in February forcibly redeemed Okada’s 20 percent stake in the company, saying he made improper payments to gaming officials in the Philippines.
Okada has denied the allegations. He filed counterclaims in the lawsuit accusing Steve Wynn of running the company like his “personal fiefdom.”
Wynn Resorts filed its complaint against Okada Feb. 19, alleging he is developing two casinos and three hotels in Manila and seeks to lure “high-limit, VIP gamblers” from China in direct competition with Wynn Resorts’ casino in Macau.
Hicks rejected Okada’s argument that the case belongs in federal court because Wynn Resorts’ redemption of his shares was based on allegations that he violated the U.S. Foreign Corrupt Practices Act.
“The mere presence of a federal question does not require federal jurisdiction,” Hicks said.
Mike Weaver, a spokesman for Wynn Resorts, said in an e- mailed statement that the company was pleased that the judge agreed that Nevada state court is the proper forum for the case.
In a separate case, Okada has petitioned a Nevada state court judge to give him access to Wynn Resorts’ books and records regarding the company’s HK$1 billion ($129 million) pledge in July 2011 to the University of Macau Development Foundation. Okada said he objected to the donation.
The case is Wynn Resorts v. Kazuo Okada, 12-00400, U.S. District Court, District of Nevada (Las Vegas).
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