Wynn Las Vegas Takes Legal Action Against Fontainebleau For Supposedly Trying To Steal Its Workers
For a very long time, executives of the Wynn Las Vegas believed that Fontainebleau was actively trying to copy the unique experience that Wynn provides to its guests. It went so far that Fontainebleau began poaching some of their best workers. These actions led Wynn to submit a legal action in an attempt to put a stop to it, according to the Las Vegas Review-Journal.
Recruitment attempts:
The start of recruiting attempts reportedly started in the middle of 2022, which is exactly a year and a half prior to the official opening of Fontainebleau on The Strip, right when Fontainebleau’s executive team was in the process of being created. In addition, Wynn officials commented that other resort sought out its executives, even though it knew they had a non-competition contract and had signed a contract with Wynn that would bar them from working for another firm for a year, at least.
Officials from the 2 resorts had a meeting where they agreed that Fontainebleau would stop doing that. However, although they agreed, Fontainebleau didn’t stop, and continued with recruiting attempts in February, all of which led Wynn to take drastic step of filing a legal action late on March 1 in Clark County District Court, charging other resort of prying into prospective and actual contractual relationships, based on information from Wynn officials.
In the said lawsuit, Wynn reportedly accuses Bowtie Development LLC, Fontainebleau Development LLC and Fontainebleau Las Vegas II LLC, all operating as Fontainebleau Las Vegas, in addition to ten unnamed people accused.
The lawsuit:
The 10-page, one-count legal action requests from the court an order that forbids Fontainebleau from continuing to defraud workers and for Wynn to receive more than $15.000 in court-ordered damages.
In this regard, the firm commented in a statement published after the legal action was submitted: “Clearly, we want all operators in Las Vegas to be successful; it’s good for the city in which we all live. We just want that to happen without interference in the contractual agreements our employees have negotiated with us.”
Relatedly, in a response to a question from the Las Vegas Review-Journal, the representative from Fontainebleau commented: “As a matter of company policy, we do not comment on pending litigation.”
Simply put, the lawsuit offers a graphic picture of how Wynn officials think Fontainebleau wants and is trying to purloin a crucial part of its employees. In this regard, the lawsuit claims: “Fontainebleau simply cannot stop interfering with WLV’s employment contracts. Fontainebleau’s conduct is demonstrative of an unhealthy obsession with everything Wynn, from its amenities to its employees.”
As reported by the Las Vegas Review-Journal, the legal action cites names and dates related to Fontainebleau’s recruitment attempts, which include going to the resort posing as paying clients in order to gain easier access to employees, with the main goal of persuading them to leave and come work for them.
A large number of examples cited in the lawsuit included offers to hire Wynn’s executive chef, restaurant and nightlife lineup. Also, Wynn listed 9 cases in which executive of the other resort contacted Wynn workers. However, in a few instances, recruits discussed it further with their coworkers to entice them to jump ship as well, based on information provided by the Las Vegas Review-Journal.
Continuous incidents:
In the first case, Mike Pappas, General Counsel of Fontainebleau, reached out to David Snyder, a member of the inaugural senior management team for every of the 6 Wynn Resorts across the globe and who signed a renewed contract during January 2021. All of this led to Snyder giving notification during June 2022 that he would be transferring to other resort, on July 8.
In that regard, the lawsuit claims: “Snyder informed WLV’s (chief operating officer) that he intended to engage in a similar function for Fontainebleau as he had for WLV. Fontainebleau had recruited and hired Snyder to help open its new resort on the Las Vegas Strip.”
That action prompted Wynn to submit a legal action against Snyder and Fontainebleau the very next day on July 9. However, it was resolved and Fontainebleau commented that it would cease its attempts to recruit Wynn’s workers that are under contract.
Speaking of which, the ongoing lawsuit claims: “Snyder and Fontainebleau agreed, among other things, that they would ‘not directly solicit any WLV employees, including by any outside recruiting agents working on behalf of defendants.’ This non-solicitation covenant was to remain in effect through July 8, 2023.”
But other resort didn’t stop, the lawsuit claims, as it happened a few more times with offers to employ the vice president of nightlife, pastry chef and sous chefs. It even got to the point where the CEO of Wynn Resorts, Craig Billings, had to step in by reaching out to Jeff Soffer, the CEO of Fontainebleau, calling him to cease the attempts.
Furthermore, the latest incident happened in February, Wynn alleges in the legal action.
During January, Fontainebleau senior vice president of nightlife Michael Waltman called senior executive director of nightlife and head of Encore Beach Club and XS Night Club, Wayne Crane, to convince him to abandon Wynn and transfer to other resort. In that regard, the lawsuit claims: “Waltman told Crane that Crane was ‘not appreciated over there’ at WLV. … Waltman knew that Crane was subject to a non-competition agreement and that accepting employment with Fontainebleau would breach that agreement.”
The end result of this was that Crane stayed in Wynn, although he was due to begin to work at other resort in March. He provided a notification that he was abandoning Wynn on February 12, but Wynn officials convinced him to stay by offering him a raise.
Of this, the lawsuit says: “WLV had only two options: to allow Crane to leave, causing substantial harm to WLV’s nightlife business, or to mitigate damages by convincing Crane to stay at WLV for a substantial pay raise. WLV was able to convince Crane to stay at WLV. However, to do so, WLV had to significantly increase Crane’s salary — a direct result of Fontainebleau’s tortious interference with Crane’s employment agreement.”
When asked if Wynn had an identical problem with firms trying to steal its workers, the representative of the firm said that happens occasionally when the newest Strip resort officially opened. However, he declined to say which other firms have also done so.
Commenting on this, a spokesperson commented according to Las Vegas Review-Journal: “As the premier resort in Las Vegas, we have had other operators attempt to interfere with our employment contracts and have historically resolved them through negotiation but have not hesitated to protect our rights through litigation.”