Nevada Supreme Court Will Decide Whether Gambling Regulators Can Discipline Steve Wynn

Written By Derek Helling on January 6, 2022

If the Nevada Gaming Control Board gets its way, some Steve Wynn harassment penalties might soon be handed down. The state’s Supreme Court is deciding on an appeal from the NGCB that has broader implications than merely whether Wynn will face any discipline from the board, though.

At stake is whether the Board can discipline people with former material connections to licensed gambling establishments in the state or whether that jurisdiction falls dead when people separate themselves from such operations. Wynn might be the first such example of that.

Possible Steve Wynn harassment penalties on the line

Almost two years ago, the NGCB fined Wynn Resorts a record $20 million. The fine was for what it called failing to adequately act on complaints about Wynn – the former CEO of Wynn Resorts and one of the world’s biggest casino magnates. Multiple subordinates of Wynn’s alleged he sexually harassed them.

Wynn resigned two weeks after the allegations surfaced about a year prior to that. Shortly thereafter, he also divested his personal holdings in the company. Since then, the NGCB has been fighting a legal battle over whether it can sanction Wynn himself.

Regulators sought to bring action against Wynn for his conduct under the state’s suitability regulations. However, Wynn’s attorneys argued that as he no longer works for any NV gambling company, the Board has no jurisdicti
on. Had they found his conduct unsuitable while he was still a Wynn employee, the attorneys say, they should have sanctioned him then.

So far, lower courts have agreed with Wynn’s counsel. Thus, the state’s highest court is now weighing in. In oral arguments earlier this week, both sides laid out their cases for not only what the court’s decision could mean for Wynn but the future of gambling in Nevada as well.

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Ramifications clear in the arguments before the court

As counsel for the Board posited and Justice Lidia Stiglich posed a question toward, an upholding of the lower court rulings could give bad actors a sort of “get out of jail free card.” Stiglich called the prospect an inoculation against any discipline.

In theory, gambling company executives could violate regulations and statutes then simply resign before facing any sanctions. Their separation from the gambling industry would act as a roadblock to any penalties from the state.

Counsel for Wynn argues that sanctioning ex-employees of gambling companies would be an overreach for the Board. If such people have done anything illegal, other law enforcement bodies have the proper jurisdiction. To date, no law enforcement body has pressed charges against Wynn.

Wynn denies the allegations against him. A civil lawsuit filed against him by nine alleged victims was dismissed but is now on appeal. It’s unclear whether the NGCB would allow that to play out before issuing any penalties.

That would be more important if the Court decides that the NGCB can discipline Wynn. For now, his fate is in the justices’ hands. Their decision could have far-reaching effects either way.

Photo by Charles Krupa / Associated Press
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Derek Helling

Derek Helling is the assistant managing editor of Playin USA. Helling focuses on breaking news, including legislation and litigation in the gaming industry. He enjoys reading hundreds of pages of a gambling bill or lawsuit for his audience. Helling completed his journalism degree at the University of Iowa.

View all posts by Derek Helling