Evading the $19M Land Sale Obligation
Wynn Resorts Escapes $19 Million Obligation in Clandestine Encore Boston Harbor Property Transaction
Wynn Resorts has managed to sidestep paying $19 million as part of a supposed secret land transaction for the Encore Boston Harbor casino resort site. The initial agreement on the property's price stood at $75 million, but the Massachusetts Gaming Commission (MGC) capped the deal at $35 million due to doubts about hidden connections between seller FBT Everett Realty and Charles Lightbody, a figure known for suspected organized crime ties.
A lawsuit intended to compel the company to settle up.
Anthony Gattineri, who owned 49% of FBT, accused Wynn Resorts Development Senior Vice President Robert DeSalvio of promising him the $19 million in exchange for agreeing to the $35 million sale on paper. This secret payment, Gattineri alleged, represented his cut of the $40 million the MGC subtracted from the final purchase price. To date, Wynn has not honored this payment.
The Massachusetts Supreme Judicial Court decided this supposed agreement was unenforceable as it had been hidden from the MGC, thus violating public policy by jeopardizing public faith in the integrity of the gaming licensing process. The court's ruling also suggested that FBT had misled the gambling regulator's investigators examining ties with Lightbody.
A rocky road to success
FBT Everett Realty acquired the industrial wasteland site in 2009 for $8 million prior to casino gambling becoming legal in the state. In 2011, state legislation opened the door for large-scale commercial casinos' development.
Wynn Resorts obtained the option to buy the land in late 2012 if it snagged one of the three available commercial casino licenses in the state.
The MGC eventually limited the deal to $35 million, a sum deemed fair if the site was not intended to host a casino. This cap was controversially classified as "highly unusual" in prior legal proceedings associated with the issue.
Charles Lightbody and two other key FBT figures were indicted federally in 2014 for allegedly forging documents to conceal Lightbody's interest in the land. All were acquitted.
A never-ending headache
The MGC has faced numerous hurdles concerning Encore Boston Harbor. Its first chairperson, Stephen Crosby, resigned his position in 2018 under allegations of bias in awarding a Boston-area casino license to Wynn. Mohegan Sun took legal action against the commission in response to the decision process.
Offloaded real estate assets of Encore Boston Harbor in December, Wynn sparked controversy involving allegations of concealing sexual misconduct accusations against the company's founder and former CEO, Steve Wynn, from the MGC. This led to the Las Vegas-based company forking out a $35 million fine to the regulator and coming close to revoking its license.
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- The Massachusetts Supreme Judicial Court's ruling on the Wynn Resorts land sale dispute has highlighted a potential nexus between finance, politics, and crime-and-justice, as the court determined that the supposed agreement between Wynn Resorts and FBT Everett Realty violated public policy and jeopardized public faith in the integrity of the gaming licensing process.
- The ongoing saga of Encore Boston Harbor's business dealings continues to create waves in the general-news arena, with the latest development being the offloading of real estate assets by Wynn Resorts in December, which has rekindled talks of concealed information related to sexual misconduct allegations against Steve Wynn and possible implications for the company's gaming license.
- The Massachusetts Gaming Commission (MGC) has grappled with numerous controversies surrounding Encore Boston Harbor, including allegations of bias in awarding a casino license, a court ruling pertaining to a secret land sale agreement, and accusations of withholding information about sexual misconduct allegations against Steve Wynn, hence adding an additional layer of complexity to the gaming industry's relationship with politics and finance.
