The latest development around major international casino developer and operator Wynn Resorts saw the management of Sterling Suffolk Racecourse file a lawsuit accusing the operator in unfairly obtaining licensing. According to the wording of the suit, former CEO Steve Wynn and fellow leading executives cheated during the license bidding process and failed to disclose valuable information regarding the company’s past.
This lawsuit has the potential to stir up the pot in Massachusetts since its claims are quite seriously affecting many major parties in the field. As it has been pointed out by the former owner of Suffolk Downs racetrack located in East Boston, Wynn Resorts management kept several crucial details in secret during the casino licensing process back in 2014. Now the casino developer Wynn Resorts was accused of acting in direct breach of the existing federal Racketeer Influenced Corrupt Organization Act.
Accusations Aimed at Wynn Resorts Emerge
Unfair circumstances surround the casino license acquisition performed by Wynn Resorts, as claimed by the racetrack management. The first accusation could be dated back to April when it was disclosed that the previous owners of the land where Encore Boston Harbor now rises, FBT Everett Realty, were related to the Mob.
At the time of the casino license issuing the state gaming regulator saw nothing unusual or any issue with Charles Lightbody, a convicted felon and his previous ownership of the land lot, giving it an OK. In a court testimony given by two witnesses of the process, it was revealed that Wynn Resorts representatives were aware before the finalizing of the deal that one of the sellers had previously been associated with criminal activities.
Soon after that, the casino developer issued a second statement claiming that this was untrue and the testimony should not be taken into account. In addition to that, the sexual misconduct allegations occurring earlier this year is yet another negative situation which could have impacted the ultimate decision of the Massachusetts Gaming Commission regarding the suitability of Wynn Resorts.
Suffolk Downs’ management claims that these undisclosed details are what eventually guaranteed Wynn Resorts the casino license for Greater Boston, eyed by the former company as well. License-fixing accusations were also made, as apparently Paul Lohnes, another of the previous owners of the land was linked to Massachusetts Gaming Commission’s Chairman Stephen Crosby. The latter crossed Caesars Entertainment’s name from the list of potential Greater Boston area operators essentially scrapping Suffolk Downs chances as well.
Lawsuit Demands Seek Justice
The casino licensing competitor Sterling Suffolk Racecourse now demands to be paid more than $1 billion in damages since it was unlawfully deprived of the chance to develop a potentially successful gaming operation in the region. Under the aforementioned Act’s influence, this sum could be tripled reaching $3 billion.
Among the defendants within the company, there were the names of current Chief Executive Officer Matthew Maddox, as well as former Executive Vice President and General Counsel Kim Sinatra who left the company in August. If the process of licensing was conducted in full transparency Suffolk Racecourse might have had bigger chances at obtaining the gambling permit.
After it was denied its acquisition, Suffolk Downs’ 161-acre property was sold for $155 million, a significantly smaller sum than the potential windfall it could have witnessed if a gaming license allowed an integrated resort to be built there. The damages would be sought from rival Wynn Resorts, set to launch operation of $2 billion Encore Boston Harbor.
As a response to the accusations and the lawsuit filing, Wynn Resorts claimed that they are “frivolous and clearly without foundation”. The casino developer would launch defense legal actions in order to protect its reputation. In the meantime, the investigation which could make or break Wynn Resorts future within the state conducted by Massachusetts Gaming Commission is approaching its final stage.
The probe’s findings on the controversial situation surrounding the land purchase could be disclosed on 27th September at the regulator’s monthly meeting.
