UPDATE 1-Law firm withdraws from Okada camp in Wynn legal brawl

Fri Nov 16, 2012 6:32pm EST

By Sue Zeidler

LOS ANGELES Nov 16 (Reuters) - One of the law firms representing Japanese pachinko tycoon Kazuo Okada in a bitter legal dispute against Wynn Resorts Ltd has withdrawn from the case, a lawyer from the firm said on Friday.

Paul Spagnoletti, an attorney with the New York offices of Davis, Polk, Wardwell LLP, said his firm has stopped representing the Japanese businessman, who is trying to reverse Wynn's decision to redeem Okada's shares in the company at a steep discount.

Spagnoletti would not cite a reason for the sudden withdrawal, but said his firm had filed court papers declaring its withdrawal. Okada was not available for comment.

Okada -- formerly Wynn Resort's largest shareholder through his subsidiaries -- and CEO Steve Wynn are locked in a legal dispute across several cases and courthouses, a dramatic reversal for the two former partners and friends.

Their friendship deteriorated in 2011 over accusations, which Okada has denied, that the Japanese entrepreneur made improper payments to try and push through a pet project of his in the Philippines.

Then in February, Wynn dramatically and forcibly bought back Okada's stake -- valued then at $2.7 billion -- at a 30 percent discount after an internal probe by former FBI director Louis Freeh revealed Okada had allegedly violated U.S. anti-corruption laws.

The Asian businessman, who made his fortune making and marketing "pachinko" game machines, is also trying to get a U.S. court to reverse that share redemption.

In the latest twist to their ongoing legal brawl, U.S. gaming regulators are investigating millions of dollars paid by affiliates of Okada's Universal Entertainment Corp to a former consultant for the Philippine gaming authority -- right around the time his company was lobbying to win concessions for a $2 billion Manila casino.