A federal appeals court in San Francisco has upheld the earlier dismissal of a lawsuit brought against international casino operator Wynn Resorts by the Louisiana Municipal Police Employees’ Retirement System over alleged fiduciary duty breaches.
According to a report from the Las Vegas Review-Journal newspaper, the Louisiana Municipal Police Employees’ Retirement System holds stock in Wynn Resorts and filed the action in Las Vegas District Court in 2012.
The “shareholder derivative action”, which involves an investor suing when it believes directors and officers have not done the best job of managing a firm in its best interests, was brought after Wynn Resorts decided in 2011 to donate $135 million to the University Of Macau Development Foundation. It alleged that the contribution ultimately made by the Wynn Macau Limited subsidiary had been unprecedented and noted that the university’s chancellor, Fernando Chui, was additionally the head of Macau’s government with oversight on gaming matters.
The filing, which sought financial damages as well as an end to any further donations to the University Of Macau, was dismissed by the United States District Court For The District Of Nevada in February before the investor appealed to the 9th Circuit Court Of Appeals.
In its ruling, the 9th Circuit Court Of Appeals said that the shareholder had failed to provide sufficiently particularized allegations in support of its inference that a majority of Wynn Resorts’ board lacked independence. It moreover supported the previous ruling that the contentions had been inadequate to show such a deficiency.
Wynn Resorts, which operates the Wynn Macau Resort as well as the upcoming Wynn Palace Cotai in the former Portuguese colony, had previously denied any suggestion of impropriety and explained that the contribution agreement had been reviewed by attorneys in order to ensure that it complied with United States anti-bribery laws.