John “Jay” Hagenbuch, the Wynn Resorts director whom Elaine Wynn launched a campaign to oust, announced Tuesday he would not be seeking reelection to the board at the company’s annual general meeting, which was scheduled for today, Wednesday, May 16.
Ms. Wynn claimed that Hagenbuch was a crony of Steve Wynn and demanded his removal from the board to make way for fresh blood.
She said she believed a complete shake-up was needed to restore the company’s reputation in the wake of the sexual misconduct scandal that led to her ex-husband’s departure.
Ms. Wynn became the company’s largest shareholder after Mr. Wynn resigned as chairman and CEO and sold his shares. She has since clashed with the board from which she herself was ousted in 2015.
She objected, in particular, to the fact that Hagenbuch was one of three directors on a special committee involved in Wynn Resorts’ own internal investigation into the allegations against its former chairman, a position she said was inappropriate since the two men are old friends.
Hagenbuch ‘Shared Culpability’
Ms. Wynn gained the upper hand when the influential advisory firm Glass Lewis told Wynn Resorts shareholders there would be “greater value” in rejecting Hagenbuch’s nomination.
It called his role on the special committee “questionable” and suggested he “shared culpability” for “misaligned compensation practices” – a reference to allegations that Mr. Wynn paid off female employees for their silence, allegedly with the board’s knowledge.
Another advisory firm, International Shareholder Services, said Hagenbuch was “part of a legacy board that oversaw material failures in governance and risk oversight.”
Lawsuit to Block AGM
In a statement, Hagenbuch said he had decided to step down because he did not want his candidacy to “detract from the important progress we have made throughout the organization, including the ongoing refreshment process this Board has initiated.”
“Over the past three months, the Board has done a remarkable job maintaining stability at Wynn and managing through a tumultuous time that could easily have caused much deeper disruption to the company’s business,” Hagenbuch said.
“There is still more work to be done,” he added.
While the AGM was scheduled to go ahead today, it’s no dead cert. Last month, Ms. Wynn sued the company to delay the meeting.
She wanted time to canvass shareholders to help oust Hagenbuch and accused the board of stalling on a request to provide her with a full list of contact details. However, Hagenbuch’s resignation yesterday has removed the main aim of the lawsuit.