A top Nevada lawmaker has introduced a bill to replace the state Attorney General’s Office as legal counsel to the Nevada Gaming Control Board, claiming the office is tainted by a conflict of interest stemming from Attorney General Adam Laxalt’s reputed ties to casino mogul Sheldon Adelson.
Las Vegas Democrat Maggie Carlton, who chairs the Assembly Ways and Means Committee, is sponsoring the measure in response to the controversy swirling around Laxalt over his lobbying of Control Board Chairman A.G. Burnett on behalf of Adelson and Adelson’s Las Vegas Sands Corp.
Adelson and LVS were embroiled at the time in a protracted and bitterly fought civil action involving Steven Jacobs, who had been fired as CEO of the company’s Macau casinos back in 2010 and was suing for wrongful termination.
Republican mega-donor Adelson was the largest contributor to Laxalt’s campaign for attorney general, and Laxalt, who is reported considering a run for governor, was secretly recorded in a private meeting with Burnett last spring requesting that Burnett bring the Gaming Control Board onto Adelson’s side in the case, which was then in its fifth year and wasn’t going well for the powerful casino magnate.
At issue was an internal report Sands had filed with the Control Board in the midst of investigations into the company and its China operations by the U.S. Justice Department and the U.S. Securities and Exchange Commission. It was widely reported that the investigations were sparked by allegations of wrongdoing on the part of Adelson and Sands that formed the substance of Jacobs’ lawsuit. LVS wanted the report kept out of the Nevada District Court that was deciding the case. According to an affidavit later compiled by Burnett, Laxalt wanted the Control Board to file a friend-of-the-court brief arguing for the report to be kept confidential.
The request was unprecedented, and in Burnett’s view improper, a violation of the board’s independence from the companies it regulates. After obtaining an opinion from Laxalt’s own office advising against involvement he denied the attorney general’s request. But he was concerned enough to tape their meeting and on the advice of Governor Brian Sandoval’s counsel turned the tape over to the FBI, which later offered an opinion that nothing criminal had occurred.
About a month after Laxalt came away from the Burnett meeting empty-handed, LVS and Jacobs settled for an undisclosed sum.
In introducing her bill, Carlton, who subpoenaed the details of the affair, expressed the view that those details “suggest that the attorney general has created a conflict of interest and that he should not continue to serve as counsel to the Gaming Control Board”.
“The legislature has an oversight responsibility to investigate and root out anything that undermines the integrity of the gaming industry?the core of Nevada’s economy,” she said.
Laxalt has repeatedly denied having acted improperly and said his critics are “twisting and politicizing a routine action.”
In testimony last week before a Democratic-led joint Finance Committee hearing he said that while Sands wanted the state to file a barrage of friendly legal opinions in the Jacobs case he had pursued only the one that favored the confidentiality of casino documents turned over to the Control Board.
“It could be erroneously perceived, as indeed some have recently done, as a favor to the Sands,” he said. “We were advocating on behalf of the state, we were advocating on behalf of our Gaming Control Board, as well as our very important industry.”
To which Democratic Senate Majority Leader Aaron Ford fired back, “That doesn’t preclude that you were advocating on behalf of the Sands as well.”
Carlton’s bill, in the meantime, has been referred back to her committee and the Senate Finance Committee for joint consideration.
Democrats hold a 12-seat majority in the 42-member Assembly and an 11-10 majority in the Senate.
