MGM Resolves Las Vegas SAFETY Act Litigation
After over 18 months of private mediation, MGM Resorts International has finally dismissed a series of declaratory judgment actions the company brought against victims of the Route 91 Harvest Festival shooting. Those cases stem from the October 2017 Las Vegas shooting in which Stephen Paddock killed 58 people and wounded hundreds more from his hotel room in the Mandalay Bay hotel, owned by MGM. That event resulted in thousands of threatened legal actions against MGM by victims of the shooting, accusing the Mandalay Bay hotel of providing insufficient security, which allowed Paddock to open fire on concertgoers from his hotel room.
Although MGM announced a settlement in October 2019, in which it would pay up to $800 million to resolve those lawsuits, negotiations between MGM and victims regarding participation in the proposed settlement continued until last week.
Our coverage of this litigation saga began in July 2018, when MGM launched its aggressive strategy of filing declaratory judgment actions against hundreds of victims of the shooting. In those suits, MGM asked federal courts to declare it legally immune from liability relating to the attack. The basis for MGM’s litigation gambit was the SAFETY Act – the “Support Antiterrorism by Fostering Effective Technologies Act of 2002” – a little-known law passed by Congress in the wake of the September 11, 2011 terrorist attacks to provide legal protections for companies that develop or deploy antiterrorism technologies.
As we discussed in a three-part series last year, the SAFETY Act can, in the right circumstances, serve as an invaluable tool to companies looking to manage their cybersecurity litigation risk, as well as provide a host of collateral non-statutory benefits.
The MGM cases raised a series of novel questions regarding both the scope of protections offered by the SAFETY Act and the events necessary to trigger the statute’s coverage. With MGM’s litigation nearing an end, those questions will remain unresolved, for now. To our knowledge, MGM’s cases were the only ones to date to assert SAFETY Act certification as a defense in litigation.
We will continue to report on litigation and other developments involving the SAFETY Act.