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New lawsuit against Wynn’s former CEO

Tue, Oct 1, 4:22pm by Charlotte Lee

Workplace hostility continues for female employees at Wynn Resorts, according to a class action lawsuit filed last week against the Las Vegas-based casino operator.

Casino News Daily reports a lawsuit was filed on Thursday on behalf of massage therapist Brenna Scrader.

Ms Schrader previously revealed that she had been forced to perform sex acts on Wynn Resorts’ co-founder and former chief executive officer Steve Wynn.

Mr Wynn, the billionaire businessman who played an instrumental role in the creation of Las Vegas’ modern-day skyline, was banished from the company he had created in the early 2000s following the publication of a damning report by the Wall Street Journal detailing a long-running pattern of sexual misconduct and harassment.

Mr Wynn denied to have used his power and influence to coerce female workers at Wynn Resorts into performing sex acts and subjecting them to unwanted sexual advances.

However, the WSJ report, followed by piles of lawsuits and regulatory investigations in all jurisdictions where Wynn Resorts operates casino properties resulted in the businessman’s banishment and in hefty fines and scolding for his company.

According to the recently filed lawsuit, Wynn Resorts executives continue to “mentally abuse” her.

Ms Schrader was forced to perform sex acts on the company’s former CEO from 2012 to 2016.

Her legal complaint said that “defendants appear to blame victims for the discriminatory environment that permeates workplace atmosphere to this day.”

She went on that company executives call her and other female victims of Mr Wynn’s sexual advances “prostitutes and sluts”.

According to the lawsuit, Ms Schrader tried to report the sexually hostile workplace environment and the “sexual prison-like atmosphere” back when she was coerced to have sex with Mr Wynn and as recently as this year.

However, she said that her attempts were met with resistance.

Her lawsuit alleged that Wynn Resorts “continued to outwardly support” Mr Wynn through various memorandums, “which is calculated to deter female employees from cooperating and liberating themselves from forced sexual servitude and a sexually hostile environment.”

Wynn followed procedures – company said

Commenting on news about the recently filed lawsuit, Wynn Resorts said in a Friday statement emailed to the Las Vegas that the company is “deeply committed to a fair, supportive and open work environment.”

The company went on that since the completion of a regulatory investigation, it has not received any complaints of the nature described in Ms Schrader’s lawsuit other than “the allegation in this lawsuit which was promptly investigated” and that it “immediately followed all appropriate procedures to address the matter.”

The sexual misconduct allegations and the fact that regulators found Wynn Resorts failed to address them properly could have cost the company’s licenses in Nevada and Massachusetts, where it debuted the $2.6 billion Encore Boston Harbour luxury integrated resort in June.

The casino operator was allowed to keep its gaming licenses in both states, but regulators slapped it with hefty fines and numerous conditions relating to its anti-sexual harassment policies the company is obligated to follow in order to avoid further and tougher regulatory action.

Wynn Resorts was fined $20 million by the Nevada Gaming Commission and $35 million by the Massachusetts Gaming Commission.

Encore Boston starting strong

The Boston Globe reported in July that during the first 24 hours that Encore Boston Harbour was open there were thousands of people waiting to enter, the nightclub was sold out and there was a wait to bet at the $100-minimum blackjack tables.

At the least, these anecdotes indicate strong demand at the resort early in its existence.

When Wynn Resorts reports earnings, it’ll be important to look at how those crowds translated to revenue in the resorts’ first few days.

Were hotel rooms full, were people gambling, and were restaurants and clubs busy enough to justify the property’s cost.

With a $2.6 billion price tag, the resort needs to generate a lot of revenue to be considered any kind of financial success.

To make a decent return on investment, investors should look for at least $260 million in annualized property EBITDA, a proxy for cash flow at the property.

This would be a 10 per cent EBITDA return on what was invested and is a good benchmark used to assess resorts.

Assuming an EBITDA margin of 30 per cent, that means the resort needs to generate $867 million of revenue per year, or $2.4 million per day.

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