Wynn Resorts has had a rough year already, and 2019 is just getting started. After receiving a record fine of $20 million by Nevada regulators for not keeping its founder and former CEO, Steve Wynn, on a tighter leash, the casino giant was slapped with another record fine by Massachusetts authorities for $35 million. Some would say that the company got off light compared to what was at stake, but Wynn doesn’t see it that way and has announced that it might appeal the Massachusetts fine.
On an earnings call last week, CEO Matt Maddox told listeners, “We are still reviewing the decision as it relates to some of the secondary and tertiary conditions imposed by the commission. We do not believe if we choose to appeal if that will impact our ability to open the project at the end of June.”
Maddox was also fined by the Massachusetts Gaming Commission (MGC) $500,000 because he demonstrated a “clear failure to require an investigation about a specific spa employee complaint brought to his attention.” He was also ordered to participate in leadership training courses. It wasn’t clear whether or not Maddox would try to appeal his personal fine, but it is definitely a realistic possibility.
The smart money would have been on Wynn breaking out the checkbook, paying the fine and putting this nightmare to rest. Wynn was already given the green light by the MGC to retain its license for Encore Boston Harbor – a license worth $85 million – and should have been grateful that more drastic actions weren’t taken. The MGC has stated that its decision is final and that Wynn Resorts isn’t entitled to “any further review from the commission’s determination of suitability.” If it tries to challenge the fine in court, the gloves are going to come off and everything could change.
Encore is expected to open June 23 after a slight delay. It offers 3,100 slot machines and 242 gaming tables and is to be the jewel of Boston Harbor. As long as the brass can keep its family jewels where they belong, perhaps the vision will come true. At the very least, it will help the company recover from the drop in operating revenue it reported for the first quarter as it concentrates its efforts where they should be focused.