Universal Entertainment Corporation says it is confident it will have the opportunity to present its case to reclaim 24.55 million shares in Wynn Resorts, as well as more than US$1 billion in owed share value, following a Nevada court decision last week denying Wynn’s motion for a summary judgement.
The Nevada State Court rejected a contention by Wynn Resorts that all claims filed by Universal Entertainment subsidiary Aruze USA Inc in 2012 were groundless as a matter of law, with the proceedings now free to proceed to a trial scheduled for April 2018.
“The company strongly believes that it is able to present its case at trial in light of these recent decisions of the Nevada State Court,” Universal said in the wake of the finding.
The lawsuit, originally filed in March 2012, seeks to return 24.55 million shares its says “were unfairly and improperly redeemed by Wynn Resorts” and to seek damages from Wynn Resorts “well in excess of US$1 billion for undervaluing the redeemed shares by more than 30% of the then market price of the shares, even if the redemption was valid.”
It came after the Wynn board forcibly redeemed Universal’s shares worth almost US$2.8 billion – subsequently issuing a promissory note for just US$1.9 billion – claiming Universal founder and Wynn Resorts board member Kazuo Okada put Wynn’s gaming license in jeopardy amid allegations he provided improper hospitality at Wynn properties to Philippine gaming officials to the tune of US$110,000. Okada was also kicked off the board.
At the heart of the matter is Universal’s contention that the Wynn Resorts board acted on the orders of Chairman and CEO Steve Wynn rather than independently when it kicked Okada out. The Nevada State Court has also ruled that both Mr Wynn and Elain Wynn may have to stand trial on an individual basis.
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