Court docket of Enchantment Alerts Wynn On line casino’s racketeering lawsuit has legs – Courthouse Information Service


The First Circuit seems poised to call a spade a spade when it comes to how casino magnate Steve Wynn secured the rights to build a Wynn outside of Boston.

This September 2018 photo shows the newly built Encore Boston Harbor luxury resort and casino in Everett, Massachusetts (Wikipedia Commons via Courthouse News).

BOSTON (CN) – In a case where billions of dollars were at stake and claims made for international bribery, political payouts, shady mafia numbers and rampant sexual misconduct, the First Circuit tried Monday to find out if the gambling officials were in Massachusetts made a mistake in choosing to build the only casino in the Boston area.

The battle for the project – a $ 2.6 billion resort called Encore in the nearby suburb of Everett – has ultimately licensed Steve Wynn, a Las Vegas billionaire in one corner and Suffolk Downs in the other a horse from the Boston area racetrack that opened in 1935 and was considered a local favorite.

Suffolk sued federal extortion law, alleging Wynn and his company should have been disqualified due to bribery, fraud and other serious misconduct in which they were involved.

The argument appeared to gain momentum on Monday as the federal appeals court examined whether the Suffolk case was properly dismissed in November 2019.

US Circuit Judge David Barron focused on the claim that Wynn and his company “had a way of doing business that is so criminal that there is a high risk in the future that they will continue to team up with and hide numbers of organized crime “.

“What’s the problem,” Barron wanted to know when he called it a blackmail program. “I do not understand that. I just don’t understand why that’s not a reasonable conclusion. ”

Barron, an Obama-appointed representative, pointed to a case where a drug use center in Massachusetts caused an outbreak of meningitis and officials under RICO were charged because their way of doing business could cause future harm.

One of the defense attorneys, Aaron Katz of Ropes & Gray in Boston, argued that no other court had ever used RICO on a casino motion and that it would be “a radical departure”.

“Why is this a radical departure?” Barron asked not convinced.

But Suffolk got into trouble with the judges because it partnered with Mohegan Sun, a Connecticut casino, and filed the motion in Mohegan’s name.

“You are not the most directly injured party,” said US Circuit Judge Sandra Lynch. “You made a predictability argument, but that doesn’t get you very far.”

“We were directly damaged,” said Suffolk attorney Steven Storch from Storch Byrne in New York.

But US Circuit Judge O. Rogeriee Thompson was skeptical. “How are you different from the people who wanted to deliver the furniture?” She asked,

“These people were not known to the gaming committee and did not have to prove their suitability,” said Storch.

“If the Commission did not license any party, would you be injured?” asked Thompson, an Obama appointee.

“No,” said Storch, “but we don’t have to rule everything out; we just have to show that we have been hurt by the actions of the other party.”

Lynch, a Clinton-appointed employee, piled up. She noted that Suffolk had argued that the extortion program involved action after Wynn obtained the license, but “if Mohegan did not get the license, how can you have a possible violation in relation to their ongoing license infringements?” Doesn’t that remove a whole part of your reasoning? ”

“Mohegan would have got the license,” replied Storch.

“Well,” said Lynch, “you gave me your answer, but I don’t think it makes sense.”

Wynn came to Boston with a long gaming history, where he was involved in the Golden Nugget, Mirage, Treasure Island, and Bellagio in Las Vegas, as well as casinos in Mississippi, Atlantic City, and Macau.

However, as Suffolk reports, Wynn’s success was the result of long periods of wrongdoing, including association with gangsters and political corruption. Wynn was also accused of making secret settlements to cover up dozen of sexual assault allegations, which resulted in Massachusetts gambling authorities fining his company $ 35 million despite giving it the right to build of the resort.

Suffolk alleged that Wynn’s company lied under oath and submitted forged documents about his knowledge that the toxic former chemical plant site on which Encore was built belonged to several convicted felons and a respected Mafia member who was only through an FBI wiretap attempt at a prison Light came up conversation in an independent investigation.

Suffolk also alleged Wynn wrongly passed money on to Everett Mayor Carlo DeMaria, who called the casino project “enormous” for the working class city because “we will no longer be the end of Boston”. This was part of a pattern because Wynn was also bribing political officials in Macau, Suffolk claimed.

Suffolk had its own problems with this. It had to terminate its initial partnership with the company behind Caesars Palace in Las Vegas over alleged mob connections, and its early plan to build a casino in East Boston was rejected by local voters.

Wynn was named one of the Top 30 CEOs in the World by Barron’s in 2011 and was named 17th Highest Performing CEO in the World by Harvard Business Review in 2014. In 2018, however, he resigned as head of his eponymous company due to allegations of sexual misconduct. At the same time he resigned as Chief Financial Officer of the Republican National Committee.

Wynn, an extravagant art collector, decorated the Encore Resort with a 2,000 pound Popeye sculpture by artist Jeff Koons, which he bought for $ 28.2 million.

Feeling a victory for Wynn, lawyer Joshua Sharp of Nixon Peabody in Boston made the argument that Suffolk was not just a derivative party but did not even have a binding contract with Mohegan, as the contract was only supposed to go into effect when Mohegan would award the license.

Regarding the fact that Suffolk had to prove its eligibility for the Gambling Commission, “many people are subject to regulatory scrutiny,” he said. “Even the card dealers.” If Suffolk can sue, “any party three levels removed could sue, even the card dealers,” he claimed.

Barron asked Storch if he could find a previous RICO case for a derivative party to sue. Storch first cited a Supreme Court case involving tax liens, but Barron corrected it, saying the parties in the case were not inferred. Storch then cited two First Circuit decisions.

“No,” Lynch interrupted, “I wrote these decisions and they did not affect any derived parties.”

“Well, I am not going to discuss your interpretation of your own decisions,” said Storch.

“Good idea,” Lynch replied dryly. “Do you have another point?”

But it wasn’t clear if he did it because the clerk announced he was out of time.

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