A few months have passed since Wynn Las Vegas filed a lawsuit against Fontainebleau Las Vegas. In its lawsuit, Wynn alleged that its competitor poached senior-level employees by offering them incentives, including higher pay and asking them to leave their positions, effectively breaching their non-compete clauses.
Last month, Wynn filed a preliminary injunction plea, asking a court to prevent Fontainebleau or any other companies from making attempts to disrupt its operations by poaching employees. In the latest chapter of the legal battle between the two gaming and entertainment companies, a Clark County District Judge voted against Wynn’s request for a preliminary injunction against Fontainebleau.
As announced by the Las Vegas Review-Journal, the decision came on Thursday morning, with Clark County District Judge Mark Denton denying Wynn’s request for preliminary injunction. Denton explained that the request was too broad, which makes it inappropriate for an injunction.
An Alleged Method of Intimidation
During the latest court hearing, Patrick Byrne, Wynn’s attorney, said that the company’s injunction plea sought to protect its operations from employee poaching attempts by Fontainebleau or any other companies.
At the hearing Thursday, the attorney confirmed that only an estimated 5% of Wynn’s workforce or 750 executive-level employees are subject to different non-compete clauses. According to Byrne, the injunction request sought to prevent the rival operator from interfering in existing contractual agreements between Wynn and its employees.
Todd Bice, Fontainebleau’s attorney, disagreed with Wynn’s claims. He claimed that the rival company was trying to leverage the court’s power as a method of intimidation for its employees. Bice argued that this intimidation may seek to prevent Wynn’s employees from leaving for better-paid jobs with other operators. “One of the great things about this town is the constant new opening of resorts that keeps our market pretty vibrant and creates opportunities for employees,” explained the attorney at the latest court hearing.
Wayne Crane, Wynn’s director of entertainment for Wynn Nightlife is among the list of several names mentioned in the company’s lawsuit against Fontainebleau. In the legal filing, the company claimed that Crane, who was an executive for more than a decade with Wynn, was approached by the rival company’s SVP of nightlife, Michael Waltman.
Allegedly Waltman offered Crane an exciting job opportunity which he accepted. But once Wynn became aware of the case it made a counteroffer in order to keep Crane. The company argued that it would have lost the executive to Fontainebleau unless it gave him a substantial pay raise. Shortly after, Wynn filed its lawsuit.
FTC Greenlights Non-compete Clauses Ban
The ongoing legal battle takes place at a time when non-compete clauses across the United States were recently banned. The decision came late last month from the Federal Trade Commission (FTC) which confirmed that the ban seeks to ensure the freedom of workers across the country to change jobs. While the FTC banned non-compete clauses in the general sense, existing clauses, similar to those signed by Wynn’s C-suite employees, remain in effect.