Lawsuits Could Threaten Las Vegas Resorts For Wynn, Las Vegas Sands
Photo courtesy of Wynn Resorts Ltd.
There is only one rule in the casino business: the house always wins. However, this rule may have to be amended pending the results of some serious legal drama happening in Vegas.
Daily Finance is reporting this week that a lawsuit being brought against the Las Vegas Sands in 2010 by Steve Jacobs, the former CEO of its key Macau subsidiary, could have effects on their properties the Venetian and Palazzo on the strip as well as properties in Macau. In the lawsuit, Jacobs charges his employer with “numerous illegal activities that include collaborating with organized crime and paying bribes to officials.” The lawsuit was recently ruled to be heard in Las Vegas as opposed to Macau, which helps Jacobs' side in the case, allowing him access to U.S. government materials.
The article states that if such evidence is brought to light during the trial, the company could lose its gaming license. With the Chinese government already putting the smackdown on the gaming industry in Macau, they could also be halted from doing any business overseas at all.
The Wynn, on the other hand, seems headed for fallout from the inside out. Since 2012, Steve Wynn and his twice-divorced wife Elaine have been tied up in a lawsuit about selling her shares in the company. Due to a stockholder agreement which she says is no longer valid and Steve maintains is, she has been unable to part with her stock in Wynn's company. Therefore, she has filed suit to sell her shares without Steve's permission. In April, Elaine not surprisingly, lost her seat on the board, giving the Wynn collective even less power in the company, which aides in Steve's worry that the stock will lose value.
The Daily Finance article suggests that if Elaine gets to sell her stock, the rest of the shareholders could see this as an opportunity to remove Steve from the CEO position and sell the Las Vegas properties outright.
The article also goes on to suggest that there are plenty of suitors to buy up either of the two companies assets and that this could be good for visitors. Not to mention that there are two new players in the strip casino game and that the number of rooms has increased by 20,000 in the last eight years to 151,000.
And of course, the more rooms, the lower the prices. Sure doesn’t sound so bad for the guests. Of course, anything the guests save on the rooms they are just going to spend at the tables.
See, the house always wins.
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