Reuters: Regulatory News: UPDATE 1-Okada files new claim in battle for Wynn Resorts stake

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UPDATE 1-Okada files new claim in battle for Wynn Resorts stake Jun 15th 2012, 03:55 Thu Jun 14, 2012 11:55pm EDT * Once Wynn's "best friend," Okada alleges fraud * Pachinko tycoon wants shareholder rights restored * Okada remains on Wynn board of directors for now Macau, June 15 (Reuters) - Japanese pachinko tycoon Kazuo Okada escalated his legal battle against Las Vegas mogul Steve Wynn by filing a motion for a preliminary injunction to protect his stake in Wynn Resorts. Okada asked a federal judge on Thursday to immediately restore the rights of his subsidiary, Aruze USA, as the largest shareholder of Wynn Resorts and also filed an amended counterclaim against Wynn and individual board members. Okada, who helped bankroll Wynn's casino empire starting in 2000, has been fighting to claw back his once 20 percent stake in Wynn Resorts that Wynn forcibly bought back at a steep discount after producing a report that said Okada had engaged in "improper" activities. Until Feb. 20 Okada held the largest single stake in Wynn Resorts despite being ousted from Wynn's Macau unit Wynn Macau on Feb. 24. Okada, chairman of Tokyo-listed Universal Entertainment Corp , said in the filing in Nevada that Wynn "indulged in fraud, deception, theft and betrayal to maintain control of his gaming enterprises." In the filing, Okada said "in the course of trying to illegally force out Aruze USA as Wynn Resorts largest stockholder, Mr. Wynn and Wynn resorts' General Counsel Kimmarie Sinatra committed a series of predicate acts of racketeering, which include fraud, acquiring property under false pretenses, acquiring signatures under false pretenses and other similar wrongful activities." Okada's filing may be an attempt to head off efforts to oust him from his remaining position on Wynn's board. Wynn has already filed a preliminary proxy statement announcing that a special stockholder meeting will be held for the sole purpose of removing Okada. The proxy statement did not list a date, but the company is allowed to call such a meeting with 10 days' notice. The battle that erupted in January when Okada sued Wynn for denying him access to key financial documents has placed a spotlight on corporate governance in the gambling industry at a time when casinos are mushrooming throughout Asia. Wynn, known for building premium casinos like the Bellagio and Mirage in Las Vegas, has maintained that Okada, whom he once called his "best friend," went against the Wynn board's decision and pursued a property in the Philippines, making him a direct competitor. Wynn is building a new $4 billion casino in Macau, the world's largest gambling destination. Okada who made his riches in pachinko, a mix between slots and pinball that rakes in about 20 trillion yen ($250 billion) annually, is building his own casino in the Philippines. The Japanese businessman is also setting up a string of fine-dining restaurants in Asia and is in negotiations to build a casino resort in South Korea. Trained as an engineer, he has not ventured into building leisure properties previously. Link this Share this Digg this Email Reprints

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