MGM Resorts International is suing one of its major insurance providers for breach of contract, claiming the company is not fulfilling its obligation to cover legal bills MGM is incurring in the aftermath of the 2017 mass shooting on the Las Vegas Strip.
The suit, filed in U.S. District Court against Zurich American Insurance Company, is separate from the massive claims against the gaming giant from victims and family members of those who were injured or killed in the attack. The attack occurred the evening of October 1. A lone gunman opened fire on an outdoor music concert with an arsenal of automatic and semi-automatic rifles he’d stockpiled in a suite atop Mandalay Bay, which MGM owns. Fifty-eight people died and hundreds were wounded. The gunman killed himself as police closed in.
More than 4,000 people are seeking compensation from MGM, which denies any liability stemming from the shooting, the worst in U.S. history. It said in the Zurich suit that it is “vigorously defending itself in all of the cases.” It’s expected, however, that the gaming giant could wind up paying out as much as $800 million.
MGM has reported $751 million in coverage through multiple insurance providers, so the dispute with Illinois-based Zurich American, a unit of Switzerland’s Zurich Insurance Group, should not impact its ability to pay claims related to the shooting.
Rather, the action against Zurich is based on MGM’s contention that Zurich is not honoring the terms of a general liability policy that’s supposed to indemnify the company for the legal fees it’s incurring in defending itself, which already have climbed to “many millions of dollars,” according to the suit. These include court fees, attorneys’ fees, medical exams, summonses, process-serving, transcription of records, investigative services, dispute resolution and includes “substantial amounts” that Zurich “specifically approved,” according to the suit.
“The Zurich Policy is designed and intended, and reasonably was expected by MGM, to provide broad coverage for the most serious claims that MGM could face,” the suit says, alleging that Zurich is risking the loss of “crucial attorneys, witnesses, experts, consultants and evidence and threatening imminent damage to MGM.”
Zurich declined to comment, according to local news reports.
