We wish we could ask Clint Eastwood’s character in the movie “Heartbreak Ridge” for an assessment of the Wynn-Okada fight right now. “What’s that you say, Gunney?” we would ask. And he would reply, “What we have here is a clusterf*%$, sir!”

Truly, it is hard to see how anyone comes out of this mess with a morsel of reputation intact.

For those of you just tuning in, the story is as follows: Wynn Resorts’ board of directors – whom Kazuo Okada calls a “Star Chamber” – has suddenly grown a conscience about the pachinko king who co-founded their company with Steve Wynn. They have decided to kick him out for “suitability” reasons. They gave him no trial, no chance to explain himself. They commissioned a report on his business dealings in the Philippines, judged it, and then summarily executed him as a shareholder, redeeming his shares at a 30% discount and promising to pay him US$1.9bn in 10 years, at an annual interest rate of 2%.

If we were back in the Coliseum with Bruce Lee, this would be the equivalent of Chuck Norris pulling out a sawn-off shotgun, blowing the little guy away, and then saying, “Never bring a sword to a gunfight.”

Okada has issued a press release calling the decision “outrageous”. (We wonder if there is a similar word for it in Japanese.) He has said he will fight on, which probably means he’s going to seek an injunction. But that doesn’t seem to matter to some people in the investment community, who really must be living on another planet. They pushed Wynn Macau up 3% in Hong Kong trading today – we will have to wait until Tuesday to see what the stock does in New York. This is good for the company? Really?

Meanwhile, the jurisdiction where Wynn’s report has focused its attention has also suddenly developed a conscience about Okada, with the president, Benigno Aquino, asking the gaming authorities to provide information on Okada’s business activities. Wouldn’t it be ironic if the most scandal-ridden, corruption-rife country in Asia is the one that actually brings an indictment in this sordid affair? But to be completely fair, this president is not the previous one. And his Pagcor chairman is not the previous one, to whom Okada is alleged to have given bribes by the Wynn investigators. So it might actually be likely that someone wants to make something stick.

There are some more sober people in the media community, fortunately. Reuters carried a good article quoting someone serious as saying this doesn’t mean the SEC is likely to go away quietly. Someone at marketwatch.com has pointed out this is a big gamble on corporate governance being politely assessed by the necessary regulators, and that everyone is likely to be smeared in this mess.

We couldn’t agree more. We are starting to understand much better why the Feds had to step into the gaming industry all those years ago in Las Vegas and put in place special regulations governing casino companies. They clearly attract the worst kind of people. Stay tuned to see the smoke clear from that sawn-off shotgun and find out whether the little Asian guy is still standing.  Copyright IntelMacau.com