{"id":23866,"date":"2019-04-09T09:23:58","date_gmt":"2019-04-09T17:23:58","guid":{"rendered":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/?p=23866"},"modified":"2020-10-19T06:55:14","modified_gmt":"2020-10-19T14:55:14","slug":"wynn-massagegate","status":"publish","type":"post","link":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wynn-massagegate\/","title":{"rendered":"Wynn: Massagegate"},"content":{"rendered":"

” … in dealing with these [Wynn Resorts<\/strong>] folks, you take a bite of sirloin, you take another bite, it\u2019s still sirloin. It doesn\u2019t vary.\u201d — former Massachusetts<\/strong> governor William Weld<\/strong>.<\/em><\/p>\n

In the run-up (more like amble-up) to last week’s Massachusetts Gaming Commission<\/strong> grilling of Wynn Resorts brass, there was reason to fear the MGC would go easy. There had been indications the MGC \"\"would try to run out the clock, then say to Attorney General Maura Healy<\/strong>, “Hey, they spent $2.6 billion, the building’s finished and all these people have jobs waiting for them. Let’s cut the company some slack.” No such luck<\/a>. The commission released a 200-page report<\/a> that, despite deletions to appease Steve Wynn<\/strong>, portrays a corporate cult of personality<\/a> under his reign, one in which executives readily put the image of Wynn the person ahead of the best interests of Wynn the company.<\/p>\n

CEO Matt Maddox<\/strong> admitted to a degree of having been in denial, adding that “victims felt powerless.\u00a0For that I am deeply remorseful. They felt that they didn\u2019t have a voice. That if they were to speak up they could be retaliated against. Or if they did, it would not be investigated. For that I am truly sorry.\u00a0\u201cI am sorry that our company did not live up to its values.\u00a0And when I started to realize that truth, I took it very personally. And \"\"decided that no matter who the CEO is of Wynn Resorts, or who the chairman is, that would never happen again.\u201d That being said, Global Gaming Business<\/em> described Maddox’s testimony as shaky\u00a0and unconvincing, and when you’ve lost Roger Gros<\/strong> you’ve lost middle America. As Boston Globe<\/em> columnist Teresa Hanafin<\/strong> put it, “current management has cleaned house and built a new company culture\u2014in which the only thing employees will grope is your wallet.” Or have they?<\/p>\n

Encore Boston Harbor<\/strong> Executive Vice President Brian Gullbrants<\/strong> “had oversight and final accountability for all activities at all hotels” during the period in question but either he or then-President Maurice Wooden<\/strong> swept it under the rug. Why did the company reward Gullbrants and stiffly deny culapility by Wooden to Nevada<\/strong> regulators? When consigliere Kim Sinatra<\/strong> was given a $10 million golden parachute<\/a> did her paymasters know she was going to be a key witness in the Bay State’s inquiry?<\/p>\n

Also, Maddox may be saying the right things now but he was there for the cult-of-personality years<\/a> and, as MGC investigator Karen Wells<\/strong> put it, “remedial measures do not erase the past.” Some testimony from Steve Wynn about the now-famous $7.5 million paternity suit<\/a> was introduced and it cast the casino mogul in a pretty appalling light. \"\"Putting his name on Wynn Las Vegas<\/strong> was the idea of “all of my colleagues” we are told. (Whatever happened to the cocktail-party story that Donald Trump<\/strong> was responsible?) “And along comes this gal who had a turn with me, obviously being advised on what to do, and says she is going to allege, which she alleged.” Notice how cavalierly Wynn describes and discards a woman who “had a turn with me.” Wynn says the impregnation occurred “when I was getting a manicure about 10 yards from here in my office. Bad judgment on my part.”<\/p>\n

I’ll say!<\/p>\n

Steve Wynn was also, it seems, in the habit of exposing himself to members of the resort staff. Charming. In a desperate attempt to \"\"salvage something from the hearing, Steve Wynn’s attorney Brian T. Kelly<\/strong> barked that his client<\/a>,\u00a0\u201cdenies all allegations of nonconsensual sex and nothing in this report changes that.\u201d (I guess all the supposedly consensual sex was OK.) If it matters, the MGC found Wynn Resorts on a firm financial footing, not heavily encumbered by debt\u2014this was before the Crown Resorts<\/strong> offer\u2014and funding for Encore Boston Harbor is solid.<\/p>\n

Maddox’s footing may not be. Under grilling by MGC members<\/a>, he admitted to knowing of spa employees who were “uncomfortable” with requests for “sensual massages”<\/a> from Steve Wynn and wife Andrea Hissom<\/strong>. Maddox says he tried to put a stop to it, then backpedaled to \"\"say it all could have been a misunderstanding. When Maddox told Commission Gayle Cameron<\/strong> that Steve Wynn said the sexual-misconduct allegations were all cooked up to hurt Wynn Resorts in litigation, she told him she wasn’t buying it. \u201cIt took me about five days to turn the denial into \u2018maybe there\u2019s something else here.\u2019 I understand how ridiculous that looks,\u201d said Maddox, cementing his image as a Steve Wynn errand boy.<\/p>\n

Board member Pat Mulroy<\/strong> didn’t cover herself with glory<\/a> by saying she and her colleagues had been made too gun-shy by litigation to \"\"probe the paternity settlement and accepted Steve Wynn’s explanation that it was just one of those one-time things. (And not exactly a trip to the moon on gossamer wings.) Probably the most convincing testimony for Wynn Resorts came from outside consultant\u00a0Jennifer Marietta-Westberg<\/strong>, late of the SEC<\/strong>. She said that out of 19 similar corporate crises she’d audited,\u00a0\u201cI found Wynn Resorts made the strongest and swiftest response.\u201d<\/p>\n

To its credit, Wynn Resorts, in the fallout after Massagegate, “commissioned a pay equity study, started a new paid parental leave program, launched a Women\u2019s Leadership Council<\/strong>, started an employee scholarship program and distributed a survey on workplace conditions.”\u00a0“That sends a message that you’re not going to tolerate enablers. That being silent is going to come back and haunt you,” Barbara Krebel-Chang<\/strong>, ethics professor\u00a0at Boston University<\/strong>‘s Questrom School of Business<\/strong>, told CBS News<\/strong>. Still, Massachusetts<\/strong>‘ official stance is that \u00a0remedial actions\u00a0“do not erase the fact that the corporate failures … are significant, repetitive, and reflective of the Company’s historical government practices.”<\/p>\n

The question now becomes one of whether Wynn Resorts went far enough. The chattering classes in Boston<\/strong> say no. Globe columnist Joan Vennochi<\/strong> questioned the credibility<\/a> of Maddox, Elaine Wynn<\/strong> \"\"and board member (and Bill Clinton<\/strong> administration hack) Dee Dee Myers<\/strong>. Only Chairman of the Board Phil Satre<\/strong> was spared the lash. Indeed, Vennochi raised the question of whether Ms. Wynn’s position within the company is safe once the dust settles. As for her ex-husband, he’s squelching potential court battles, settling six sexual-harassment lawsuits<\/a> in recent months.<\/p>\n

Columnist Larry Edelman<\/strong>\u00a0took the larger view<\/a>, questioning whether it was worth trying to strip Wynn Resorts of its $2.6 billion trophy property, an action that would not only deprive the state of revenue but could tie it up in litigation for years. Unimpressed by the Nevada Gaming Control Board<\/strong>, Edelman suggested that its Massachusetts counterpart levy a fine that would really hurt: $100 million. (Do you really think Maddox would take his ball and go home?) Even if you accept Edelman’s number, it’s difficult to make the argument that Wynn Resorts hasn’t reinvented itself. It’s more a question of how many rotten apples remain in the barrel.<\/p>\n

He followed that with a proposed 5%-7% tax surcharge, which could be rebated if the company remains on its best manners. “The criteria \"\"would need to be determined, but could include diversity goals and comprehensive sexual-harassment reporting and enforcement procedures.” Lastly, Edelman wants Maddox’s head on a silver platter. On this, we are inclined to agree. The man does not inspire confidence as the one to lead Wynn in the new era and there are plenty of other nominees\u2014Anthony Sanfilippo<\/strong> comes to mind\u2014out there, updating their resum\u00e9s.<\/p>\n

As for Steve Wynn, we may have him to kick around again soon. His non-compete clause with Wynn Resorts expires in 10 months and he’s made an ill-timed return to public eye<\/a>, as though to tell<\/a> Massachusetts, “Screw you.” CNN<\/strong> describes<\/a> Wynn “The mogul …\u00a0credited with being the person who transformed Las Vegas<\/strong> casinos from gambling dens into entertainment hubs where guests could watch spectacular shows and eat in high-end restaurants.” Maybe that is the real problem. Perhaps we are all members of Steve Wynn’s cult of personality.<\/p>\n

This Just In<\/em>: The Globe’s Joan Vennochi has called for the MGC to demand the resignations of Elaine Wynn and Matt Maddox. “They are \"\"links to a sordid past that affects the current corporate culture, even as Wynn Resorts claims to be a new company,” she writes. Vennochi depicts a Maddox who “withered” under cross-examination and couldn’t name specific human-resources improvements<\/a> he claimed to have put in place. Ms. Wynn was eviscerated for playing the role of the betrayed wife, \u00a0one who knew about the paternity settlement (the most 7.5 million smackers ever paid) yet didn’t think to tell the MGC about it four years later. “On paper, Wynn Resorts has new board members who say they are committed to transparency and sweeping corporate reforms. Behind the scenes, there\u2019s dysfunction at the top, another direct link back to Steve Wynn\u2019s legacy,” Vennochi writes, alluding to the “hate” alleged between Maddox and Ms. Wynn. She posits a scenario under which Maddox is thrown in front of the regulatory bus while Ms. Wynn and her 9% of WYNN shares live happily ever after.<\/p>\n

Wynn Resorts has already sacked security director James Stern<\/strong> for spying on Ms. Wynn. According to the MGC, Stern was shadowing Ms. Wynn to see if she was a back-channel<\/a> of damaging material for the Wall Street Journal<\/em>. Stern’s version was that he was trying to see if Ms. \"\"Wynn and Kazuo Okada<\/strong> were in cahoots, which both parties (Okada through his attorney) have denied. Damagingly for his cause, Maddox says he approved the surveillance so long as it was “above board,” which shows you how much weight his orders carry. A weekend legal briefing declared<\/a> that\u00a0\u201cno surveillance will be conducted of employees or third parties without the permission of the chief global compliance officer and the general counsel or other in-house counsel to whom she delegates responsibility.\u201d However, that may be too little, too late.<\/p>\n

As William Weld might say, “When you take a bite of this Wynn Resorts testimony, it’s bullshit; you take another bite, it’s still bullshit. It doesn’t vary<\/em>.”<\/p>\n","protected":false},"excerpt":{"rendered":"

” … in dealing with these [Wynn Resorts] folks, you take a bite of sirloin, you take another bite, it\u2019s still sirloin. It doesn\u2019t vary.\u201d — former Massachusetts governor William Weld. In the run-up (more like amble-up) to last week’s … Continue reading →<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[42,237,188,112,207,25,232,32,233],"tags":[],"_links":{"self":[{"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/posts\/23866"}],"collection":[{"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/comments?post=23866"}],"version-history":[{"count":3,"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/posts\/23866\/revisions"}],"predecessor-version":[{"id":28530,"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/posts\/23866\/revisions\/28530"}],"wp:attachment":[{"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/media?parent=23866"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/categories?post=23866"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/tags?post=23866"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}