April 10, 2018
April 10, 2018
SALEM – State Treasurer Tobias Read and Oregon Attorney General Ellen Rosenblum announced a shareholder lawsuit against Nevada gambling mogul Steve Wynn and the board of directors of Wynn Resorts Ltd. for massive breaches of fiduciary duty that caused damage to the company and impaired long-term shareholder value.
The civil case was filed Tuesday in District Court in Clark County, Nev., on behalf of the Oregon Public Employees Retirement Fund. The litigation cites the repeated failures of Mr. Wynn and nine current members of the board of directors to act in the best interests of shareholders and stop a pervasive pattern of sexual misconduct at the company. The lawsuit also cites millions of dollars in unjust enrichment to company leadership.
“Wynn’s board of directors failed to protect shareholders, the company, and its employees. The board of directors failed to investigate allegations of sexual abuse and harassment. They didn’t act to prevent Mr. Wynn from further harassing employees. This filing will help hold the Board of Directors and Mr. Wynn accountable for their profound dereliction of fiduciary duty,” said Treasurer Read, who is a member of the Oregon Investment Council, which sets state investment policy.
“Corporate wrongdoers are legally responsible when they commit or cover up sexual harassment in the workplace,” said Attorney General Rosenblum. “In this lawsuit, we claim that Mr. Wynn’s previously unreported bad conduct resulted in a reduction in the value of the state’s investments in his properties. We are pleased to represent the Oregon Public Employees Retirement Fund and Treasurer Read in attempting to recover these losses for Oregon.”
The securities lawsuit is a derivative action which seeks to hold the board accountable for the damage caused to the company. On Nov. 30, the Public Employees Retirement Fund held 8,506 shares of Wynn Resorts worth a total of $1.3 million.
Shares of the company fell in value by 13 percent in January after news coverage of allegations that Wynn, the founder of the company, pressured employees for sex.
The Oregon complaint says that the board of directors did nothing to stop the alleged sexual predation, despite knowing since at least 2016 of the allegations.
As a responsible shareholder, Treasury engages with corporations, boards and executives to facilitate the profitable and sustainable long-term growth of Oregon’s investment portfolios. If alleged wrongdoing results in material investment losses or other negative impacts to shareholders, Treasury works with the Oregon Department of Justice to recoup losses and enforce accountability through securities litigation.
Treasury’s corporate governance program, under the leadership of Jennifer J. Peet, strives to enhance long-term value for beneficiaries via executive engagement and proxy voting, interaction with regulators to improve market efficiency, and advocacy for better transparency about Environmental, Social and Governance (ESG) risks.
The Oregon State Treasury protects public assets, saves money, and helps Oregonians to invest in themselves and their families through empowerment programs like the Oregon 529 Savings Network and OregonSaves. Treasury oversees public investment, banking, and debt management services. State investment policies are set by the Oregon Investment Council. Treasury also promotes public outreach and education to help Oregonians learn strategies to save money and make smart financial choices.
The Oregon Department of Justice (DOJ) is led by Attorney General Ellen Rosenblum, and serves as the state’s law firm. The Oregon DOJ advocates for and protects all Oregonians, especially the most vulnerable, such as children and seniors. The Oregon DOJ has nine divisions, ranging from Criminal Justice to Child Support.
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