Wynn Okada Suit Must Be Delayed More for Probe, U.S. Says
Wynn Resorts Ltd. (WYNN)’s lawsuit against its former director Kazuo Okada should be delayed further while U.S. authorities pursue a criminal probe into possible bribery of Philippine officials by the Japanese billionaire, the Justice Department said.
“Over the last six months, the government’s investigation has progressed and uncovered evidence not previously known to the government,” lawyers for the department said in a filing yesterday in Nevada state court in Las Vegas.
The new evidence and the reasons it warrants an additional six-month stay of the lawsuit were submitted under seal to the court, according to the filing. The U.S. said it wants to avoid having the identities of potential witnesses revealed, including those cooperating with the investigation.
Clark County District Judge Elizabeth Gonzalez in May granted a Justice Department request to halt evidence-gathering in the lawsuit so the criminal investigation could proceed unhindered. The judge told the government at the time she wouldn’t extend the stay.
Wynn Resorts sued Okada last year for breach of fiduciary duty and forcibly redeemed his 20 percent stake, alleging he made potentially illegal payments to Philippine officials that could threaten the company’s gaming licenses. Okada, 71, filed counterclaims to undo the redemption of his shares in the casino operator.
Okada, the chairman of Tokyo-based Universal Entertainment Corp. (6425), is building a casino resort in the Philippines. It will compete with casinos in Macau, where Wynn Resorts gets most of its revenue. Okada, who became a billionaire selling machines for Japanese pachinko parlors, won one of four provisional gaming licenses awarded for the Manila hub in 2008.
Universal Entertainment said Feb. 5 that a third-party committee was investigating payments made through its U.S. unit, Aruze USA Inc., in the Philippines. The committee was looking at $40 million in payments, according to the statement.
Wynn’s lawyers aren’t opposing a further stay of the lawsuit, and Okada’s lawyers have told the Justice Department that they are waiting for their client’s response to the request, according to the government’s filing.
Eric Andrus, a spokesman for Okada with RLM Finsbury in New York, declined to comment on the filing.
The case is Wynn Resorts v. Okada, A-12-656710-B, Clark County District Court, Nevada (Las Vegas).
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