Hearing brings up settlement involving ex-Wynn employee

LAS VEGAS — Attorneys for Steve Wynn’s ex-wife played a deposition recording during a hearing in Las Vegas on Tuesday in which the embattled casino mogul discussed alleged illegal gambling activities of two former Wynn Resorts’ executives. It’s the latest move in a yearslong civil case involving Elaine Wynn, her ex-husband and the company they founded.

In his deposition, Steve Wynn said he was unaware that the company’s former chief operating officer was placing sports bets online.

Elaine Wynn’s lawyers are presenting evidence they say shows their client reported to the company bad acts she has alleged against him and others.

Elaine Wynn has accused her ex-husband and others of getting her off the company’s board of directors in 2015 because of her inquiries into company activities. She has claimed that she was not re-nominated to be a board member that year as a result of retaliation.

A so-called Petrocelli hearing, like the one that began Tuesday, allows attorneys to present a judge, without a jury present, alleged prior bad acts and evidence to support them. In this case, the judge is ruling on whether a particular incident that Elaine Wynn reported to the company is going to be permitted to be discussed with the jury at the trial, which is scheduled to begin next month.

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Steve Wynn resigned last month as chairman and CEO of the casino-operating company amid sexual misconduct allegations that were first reported by the Wall Street Journal. The newspaper reported two months ago that several women said the billionaire harassed or assaulted them and that one case led to a $7.5 million settlement in 2005 with a manicurist formerly employed by the company. Other allegations and a settlement with a different employee have since surfaced.

Steve Wynn, 76, has vehemently denied the allegations and attributed them to Elaine Wynn, whose attorney has denied that she instigated the news report.

Wynn Resorts has established a committee to investigate the allegations and to review internal policies and procedures.

Attorneys for Wynn Resorts at the beginning of the hearing formally acknowledged that an employee accused Steve Wynn of sexual misconduct in the workplace in 2005 and that the dispute was settled. Lawyers for Elaine Wynn later played a recording of a deposition of Wynn Resorts general counsel Kimmarie Sinatra in which she discussed the settlement.

Sinatra in her deposition said she became aware of the settlement “sometime after the divorce” of the Wynns, when Elaine Wynn called her and told her that Steve Wynn “had entered into, sometime in the past, a settlement agreement with an employee of the company.”

“But the inflammatory, crazy salacious details that have come out in the course of this litigation, I was not aware,” she said. She added that she did not know what prompted Elaine Wynn’s call and that she followed legal advice after contacting inside and outside lawyers for the company.

Elaine Wynn’s contract-related claims are what is left of a broader case that began in 2012. A portion of the fight between the Wynns ended earlier this month when an agreement that stipulated that they would vote jointly on company matters was deemed legally invalid.

Elaine Wynn owns 9.5 million shares in Wynn Resorts, which she founded with her ex-husband in 2002. Steve Wynn last week sold all his stock in the company.

A larger portion of the yearslong case was settled earlier this month when Wynn Resorts agreed to pay a Tokyo-based company $2.4 billion by the end of March.

The hearing will continue Wednesday.

Regina Garcia Cano, The Associated Press