In the latest round of a competitive corporate tug-of-war, a Clark County district judge has ruled against Wynn Resorts, denying them the temporary injunction they sought against Strip’ newcomer, Fontainebleau Resort. Wynn Resorts, a mainstay of the Strip, had accused the fledgling casino resort of an unsavory practice known as ‘executive poaching.’
The legal battle unfolded on Thursday morning, in the courtroom of Judge Mark Denton. In his ruling, Denton effectively deemed that Wynn’s request for an injunction was too extensive, and, therefore, inappropriate.
Behind the legal jargon of the injunction, Wynn’s main aim was to deter Fontainebleau from encouraging more of its workforce to shirk their existing employment contracts. Wynn has asserted that Fontainebleau’s strategy has targeted their top brass, with an uptick in such incidents since Fontainebleau opened its doors on December 13, 2023.
The backbone of the case against Fontainebleau lies in a settlement made with Wynn Las Vegas (WLV) in the same year. Wynn alleges that Fontainebleau made a mockery of the settlement in its ‘outrageous attempts… to interfere with WLV’s contracts.’ Wynn points to Fontainebleau’s attempts to onboard multiple Wynn employees as proof, dubbing it a violation of the contractual non-compete clauses.
In total, Wynn cites five infringements of the settlement in its lawsuit. In response, Fontainebleau fired back asserting the court lacks the authority to distribute an injunction that effectively bars employees from chasing better wages and working conditions with their competitors.
The lawsuit’s parchment bears the names of numerous employees purportedly lured away from Wynn Resorts. Among them, David Snyder once Wynn’s VP of Culinary Operations and Restaurant Development, is claimed to have violated his own non-compete agreement to join Fontainebleau and then enticed former coworkers to follow suit.
The same allegations surround sous chef Brian Kenny, along with former Wynn executive pastry chef Patrice Caillot. Both men are accused of attempting to woo colleagues to Fontainebleau upon their departures. In what Wynn believes to be a pattern, Michael Waltman, Fontainebleau’s Senior VP of Nightlife, and Brett Mufson, president of Fontainebleau Development, are also alleged to have tried to poach a Wynn VP. The case also implicates Fontainebleau’s General Counsel, Mike Pappas, in the tangle, accusing him of causing interference.
Amidst the accusations, Wynn was granted a restraining order to pause Fontainebleau’s solicitation. This legal countermove led to Fontainebleau manipulating a recruitment agency to cover tracks and claim that the poached employees were destined for positions at their Miami outpost, according to the lawsuit.
Interestingly, the case unfurls in the wake of a nationwide ban on non-compete clauses imposed by the Federal Trade Commission (FTC). Defending ‘the fundamental freedom of workers to change jobs’, the FTC has asserted that such agreements suppress innovation, stunt economic dynamism, and but a damper on new startups. In line with the new FTC mandate, fresh and existing non-competes were scrapped for almost the entirety of the country’s working population, with one exception. Senior executives, like those at the heart of the Wynn and Fontainebleau duel, still fall within the enforcement boundaries, rendering this dispute all the more intriguing.
