Nevada Gaming Board recommends full license for Barry Diller

Home » Nevada Gaming Board recommends full license for Barry Diller

The Nevada Gaming Control Board Wednesday unanimously recommended full licensing for billionaire media mogul Barry Diller.

Diller produced a letter from the Securities and Exchange Commission that his legal counsel said clears him of insider trading in an investigation launched two years ago over his acquisition of Activision Blizzard stock.

Following a 40-minute hearing, the recommendation on a 3-0 vote came after Board member and retired judge George Assad dropped his motion to limit Diller, who serves on the board of MGM Resorts International, to a three-year instead of full license, which the two other board members supported. Assad questioned whether the SEC letter, which Diller received Tuesday night, completely exonerated him; he also said that there’s been no formal letter from the Department of Justice, which undertook a criminal problem, unlike the civil probe from the SEC.

The final vote on licensing will held at the Nevada Gaming Commission on May 16. Two years ago in May, the Commission refused Diller an unlimited license, opting for a two-year license after it was revealed in March 2022 that Diller and fellow media mogul David Geffen and Diller’s stepson Alex von Furstenberg were under investigation after acquiring a large number of shares of Activision Blizzard stock days before the video-game maker agreed to be acquired by Microsoft for $68.7 billion. Activision shares soared on the news of the deal and the Wall Street Journal reported the three men had an unrealized profit of about $59 million on an options trade.

MGM private legal counsel Sean McGuinness told the Board that the letter states, “The SEC staff has closed its Activision securities-trading investigation with the recommendation that there be no enforcement action taken against Mr. Diller, Mr. von Furstenberg, or any of the entities affiliated with them, therefore closing the Activision investigation without an adverse action.”

The same SEC letter went out to all parties, including Bobby Kotick, the former CEO of Activision, Diller said.

McGuinness said the DOJ doesn’t employ a similar closing-letter process, but based on past experience as cited by Diller’s legal counsel and from other lawyers, the DOJ wouldn’t take action on its own after the SEC closes its investigation.

“We have concluded the investigation as to your clients, Barry Diller and the Arrow 1999 Trust,” according to the letter from the SEC. “Based on the information we have as of this date, we do not intend to recommend an enforcement action by the Commission against Mr. Diller or Arrow 1999 Trust. We are providing this notice under the guidelines set out in the final paragraph of Securities Act Release No. 5310, which states in part that the notice ‘must in no way be construed as indicating that the party has been exonerated or that no action may ultimately result from the staff’s investigation.’”

Diller, whose two-year license is set to expire, appeared before the Board via Zoom; he was attending an annual board meeting of the Coca-Cola Company, where he’s chair of the finance committee. Two of the three Board members are different, including Assad and Chairman Kirk Hendrick, from when it recommended his limited licensing two years ago.

Diller was more upbeat and confident at this hearing compared to two years ago before the Nevada Gaming Commission, when he became agitated after he was given a limited license and shouted, “That’s not fair!”

Diller is chairman of IAC, which has a large ownership stake in MGM, thus requiring licensing. Diller said that IAC has increased its 14% stake of two years ago to about 20%.

“As I said before, we would never do such a thing,” Diller told the Board. “I’ve been involved in corporate affairs and corporations for many decades and I’ve never done anything other than keep insider information inside appropriately. I wouldn’t do this, and if I would, I wouldn’t do it three days before the announced merger.”

Diller said he’s spent a lot of time cooperating with the SEC and DOJ, supplied materials they wanted, and went to Washington, D.C., to answer their questions in person.

Assad insisted on seeing the letter before voting, which had to be emailed and printed during the hearing. After reading it, Assad said he wasn’t interpreting the SEC letter as an exoneration and that nothing has been heard from the DOJ on the matter. “It’s not closed. It’s closed as of this date, but it’s ongoing with the SEC and DOJ.”

Nussbaum “respectfully disagreed” and added that since September 2022, Diller hasn’t had additional requests for interviews from the SEC or DOJ and calls that “firm evidence” the SEC review has concluded. The SEC has the right to reopen, but there’s “no basis on which it would do it, absent information they did not receive” as part of the two years they spent looking at this matter.

“We have to agree to disagree,” Assad said in rebuttal.

Board Chair Kirk Hendrick asked Diller attorney Andy Nussbaum how the DOJ handles investigations and the release of information.

“Over the normal course, the SEC and DOJ work hand in hand and proceed in parallel in an investigation like this that involves securities trading and potential civil or other liability,” Nussbaum said. “There’s been full cooperation between the two agencies and full sharing of information with both by Mr. Diller. I can’t think of a circumstance where the DOJ has continued to work on something when the SEC has concluded there’s no basis for any civil action. The DOJ doesn’t have a process of providing formal notice that its review has concluded. The SEC does and that’s the letter we received on Mr. Diller’s behalf yesterday evening.”

Hendrick told Diller that it’s important for regulators to license the most qualified and viable people. Diller’s business acumen and experience qualify, but there were “unknowns.” He also insisted that Diller’s character wasn’t besmirched by getting a two-year license, because Nevada is a rare state in which people keep their license for the rest of their lives while in good standing. Other states require applicants to return for relicensing, he said.

Diller told the Board the letter could be made public and wished it was published in the New York Times. “There’s been a lot of media speculation about this, which I’m sure that the conclusion of this will be printed on page 42, whereas the original noise about this was on page 1.”

Assad made his motion for a three-year license, but neither of his colleagues backed the request. Instead, Board member Brittnie Watkins recommended full licensing with a stipulation Diller immediately notify the Board if anything changes in the investigation. “The letter proves ‘we have concluded the investigation as to your client.’ From my perspective, the investigation has concluded.”

Hendrick said he agreed and based on Nussbaum’s experience that the letter is standard when a case is closed, he also believes the matter is closed.

“Had we gotten this letter tomorrow, it would have been a different story,” Hendrick said. “Having it today, I would be willing to move forward on a recommendation without a limitation.”

Diller is also the chairman of Expedia where he also serves on the board. He’s the founder of Fox Broadcasting Company and USA Network, and the former chairman and CEO of Paramount Pictures. Diller said he’s retiring in July from the Coca-Cola board after more than 20 years.

Recent Comments

No comments to show.

Gambling News

100% match bonus based on first deposit of £/$/€20+. Additional bonuses.

T&Cs Apply

New players only. Welcome Bonus - 100% bonus on your first deposit up to €/$/£200 Unless otherwise stated. This bonus only applies for deposits of €/$/£10 or higher! All you need to do is just deposit the money in your website.com account and you will receive this bonus instantly!

*New users only

casinosingaporesite.com is an independent source of information about online casinos and online casino games, not controlled by any gambling operator. All our reviews and guides are created honestly, according to the best knowledge and judgement of the members of our independent expert team; however, they are intended for informative purposes only and should not be construed as, nor relied upon as, legal advice. You should always make sure that you meet all regulatory requirements before playing in any selected casino. Copyright ©2023