According to a filing with the Japanese stock exchange as reported on Asian news outlet GGRAsia, Universal Entertainment Corp shareholder, Tsuyoshi Hosoba, is suing for damages related to Wynn Resorts Ltd.’s cancellation of 24.5 million shares held by Universal. The company was given a promisorry note for US$1.9 billion to reclaim the shares, then worth US$2.77 billion. The shares representated a 20% stake in Wynn Resorts.
The shareholder is claiming that Universal management breached duty of loyalty and duty of due care on seven counts. The lawsuit names Kazuo Okada along with three current directors, six former directors, and three former officers of the company.
Wynn Resorts contended in 2012 that Okada was not suitable to be a shareholder in their company, alleging that Okada had bribed Philippine Amusement and Gaming Corp (Pagcor) officials in his pursuit of a casino license for his Manila Bay Resorts casino.
Mr Okada has denied any wrongdoing and in 2012 filed a criminal complaint in Japan against Wynn Resorts Ltd and CEO Steve Wynn claiming defamation.
But the allegations precipitated investigations in his home country of Japan, Hong Kong, the Philippines, and in the U.S.
Japan’s tax authority began a review of how Universal accounted for about $40 million paid to an associate of the Philippines top regulator, Efraim Genuino, in 2010.
Hong Kong is conducting a criminal investigation as it is alleged the money passed through banks there. The F.B.I. is investigating Universal’s US-based subsidiary Azure USA as it is alleged the payments originated from there. In March Okada said that the investigation in the Philippines had concluded, but that statement was immediately corrected by Justice Secretary Leila de Lima.