MGM’s Oct. 1 legal defense sparks interest across industries

Facing potentially massive financial liability from the Oct. 1, 2017, shooting, MGM Resorts International has pursued an unprecedented defense strategy.

Companies all over the country have taken notice.

The casino operator is the first company to use the 16-year-old Supporting Anti-Terrorism by Fostering Effective Technologies Act — created in the aftermath of the Sept. 11, 2001, attacks — to counter plaintiffs’ claims.

In the worst mass shooting in modern U.S. history, gunman Stephen Paddock killed 58 and injured hundreds more as he sprayed bullets onto a crowd of 22,000 concertgoers from his room on the 32nd floor of Mandalay Bay. The Las Vegas Village concert grounds and Mandalay Bay are operated by MGM Resorts.

In July, MGM sued more than 1,000 Las Vegas mass shooting victims as part of a legal move to avoid or limit liability related to the massacre. The hospitality company argues that it is protected under the SAFETY Act because Contemporary Services Corp. — which oversaw security at the concert venue — was certified by the Department of Homeland Security.

The SAFETY Act limits or eliminates a company’s liability from a terrorist attack if it developed or deployed security technology or services certified by the Department of Homeland Security.

“The MGM lawsuit has highlighted the SAFETY Act to a degree that it certainly didn’t have before,” said Dismas Locaria, who specializes in security for Washington, D.C.-based law firm Venable.

MGM’s lawsuit has spurred companies around the United States to study whether they should go through the process to gain protection under the previously obscure law, lawyers and security specialists said.

“We’ve definitely gotten an uptick in interest,” Locaria said. “I’ve previously not had any hospitality clients in this space, and I’ve gotten inquiries from several. A couple of those are looking like they’re going to move forward with at least seeing what it’s going to take to get protection.”

Locaria declined to name the hospitality companies that have reached out to him.

Representatives for Caesars Entertainment Corp. and Las Vegas Sands Corp. declined to comment on whether their properties intend to apply for SAFETY Act certification. Representatives for Wynn Resorts Ltd., Station Casinos and Boyd Gaming Corp. did not respond to the inquiry.

The Department of Homeland Security, which oversees SAFETY Act certification, said it has seen a small pickup in applications over the past year.

But companies inquiring on the back of MGM Resorts’ action probably would not have filed an application yet because it takes months to prepare the necessary documentation.

“We have seen a modest increase in overall applications submitted to the program since October 2017,” said DHS spokesman John Verrico, adding that part of the increase could be from its own outreach efforts.

“In our experience, it usually takes more time before we can discern a trend since SAFETY Act applications for venue layered security programs are substantial undertakings and take significant time to prepare.”

A representative for MGM Resorts International declined to comment on the company’s possible influence on increased interest in the act.

Consequences

The SAFETY Act works as legal protection only if an event has been declared a terrorist attack by the secretary of the Department of Homeland Security.

Current DHS Secretary Kirstjen Nielsen has not yet made a decision on whether the Oct. 1, 2017, shooting was a terrorist attack.

“The matter is currently under review,” according to a statement on the agency’s website.

In the meantime, the legal system will determine whether the SAFETY Act liability protection extends to MGM.

But the secretary’s decision will have repercussions beyond this case. Declaring the Las Vegas shooting a terrorist attack could set a precedent for active-shooter situations and potentially push more companies to apply for certification, Locaria said.

Mass shootings have become more frequent and more deadly in recent years. There have been four since Oct. 1, 2017, that have left at least 10 people dead.

If Nielsen declines to declare the Mandalay Bay shooting an act of terrorism, it could derail interest and investment in SAFETY Act certification and products, said Chuck Marino, a former supervisory special agent with the U.S. Secret Service and former senior law enforcement adviser to former Department of Homeland Security Secretary Janet Napolitano.

But Marino still recommends that companies seek certification.

“From a civil liability standpoint, it is never going to hurt you. You always want to say in your defense that you went above and beyond what was required,” said Marino, who is based in California and advises Fortune 500 companies on security issues.

Insurance policy

Brian Finch, a partner at Pillsbury, Winthrop ShawPittman in Washington, D.C., said MGM could have avoided its current legal predicament if it had its own security program certified under the SAFETY Act. Neither Mandalay Bay nor MGM Resorts security is certified under the SAFETY Act, according to the DHS website, which lists all approved technologies and companies.

Finch spoke in September in Las Vegas at the Global Security Exchange, the industry’s largest convention. It was the first time the convention, which attracts more than 20,000 security industry professionals, invited someone to speak on the SAFETY Act since 2007.

Finch told the convention audience that not using SAFETY Act approved products, security services and plans is “kind of like being uninsured.”

“Now, a lot more” hotels and entertainment venues are thinking about the SAFETY Act and ensuring their third-party security guards and equipment are SAFETY Act-certified, he said.

Marino agrees with Finch that companies should take the extra step to get themselves SAFETY Act-certified.

“The current thinking is, ‘I am good because two-thirds of my technology is SAFETY Act-covered.’ But my recommendation is that companies should include everything from technology down to their policies and procedures,” Marino said.

Marino, too, said he has seen “a recognizable increase” in companies inquiring about the SAFETY Act since the MGM Resorts defense strategy made national headlines in July.

Time and money

Companies previously had been hesitant to get SAFETY Act approved because of the time and resources it required, Marino said.

Just preparing for the application process can take months, with the entire process, including a review by the Department of Homeland Security, sometimes taking longer than a year, said Finch and Locaria.

The Department of Homeland Security requires up to 120 days to first check the application for completeness and then study the product, service or plan for its security capabilities.

Companies need to demonstrate in their application that their product, service or plan has been well-tested.

“You need to really have a track record. You can’t just go in there saying this is what we implemented yesterday,” Locaria said.

Hiring consultants and lawyers to help with the application process can cost several hundred thousand dollars. Additional investments in SAFETY Act-approved technology could be required, increasing the overall cost of certification.

Executives previously saw the process as an investment that generated no return, Marino said. That is now likely to change after the Mandalay Bay shooting.

“After this horrendous event, the conversation within companies will now shift and be about how to protect against potential loss of business, liability exposure, and brand protection,’’ Marino said.

The Review-Journal is owned by the family of Las Vegas Sands Corp. Chairman and CEO Sheldon Adelson.

Contact Todd Prince at 702-383-0386 or tprince@reviewjournal.com. Follow @toddprincetv on Twitter.

ad-high_impact_4
Business
MGM Grand Plans To Add Retail And Dining To Its Strip Facade
MGM Grand President and Chief Operating Officer Scott Sibella said executives are “discussing redeveloping that entire frontage of the building out to the Las Vegas Strip.” (Todd Prince/Las Vegas Review-Journal)
Boyd Gaming planning new corporate campus
Casino operator Boyd Gaming Corp. has filed plans to build a new corporate campus. The plans call for two 10-story office buildings and a six-level parking garage in the southwest Las Vegas Valley. Boyd Gaming operates The Orleans, the Suncoast, downtown's California Hotel and other properties. The new headquarters would be just a mile from its current main office building.
Bellagio Conservatory transformed to celebrate Year of the Pig
The Bellagio Conservatory Team transformed the 14,000 square foot conservatory to commemorate Chinese New Year, the holiday that marks the end of the coldest days of winter. (Rachel Aston/Las Vegas Review-Journal)
CES 2019: Intro uses sound to connect people
Intro, a startup that is part of the Future Worlds Accelerator in the UK, has an app that uses ultrasonic sound to find people and companies nearby.
CES 2019 Video: CES wraps up another year
Time-lapse video of the action at CES 2019 in Las Vegas. (Mat Luschek/Las Vegas Review-Journal)
CES 2019: Create your own beauty products
Beauty Mix by BeautyByMe is a product that lets you create your own cosmetics and beauty products. (Mat Luschek/Las Vegas Review-Journal)
CES 2019: Picobrew’s home brew machine
Picobrew brings automation to homebrewing. (Mat Luschek/Las Vegas Review-Journal)
CES 2019: Surviving CES
What it's like to spend four days working the mammoth tech convention. (Jason Bracelin/Las Vegas Review-Journal)
Haier’s smart home
Haier presented smart home technology at CES 2019.
CES 2019 VIDEO: Foldimate makes laundry day easy
Foldimate has created a machine that will fold your laundry for you. Just feed it anything you need folded and it will do the rest. (Mat Luschek/Las Vegas Review-Journal)
CES 2019: Opte device corrects skin spots
Opte from Proctor and Gamble is a device for correcting spots and freckles from skin. It analyzes the area for spots and then covers them with a serum of matching skin tone. (Mat Luschek/Las Vegas Review-Journal)
Circa hotel-casino in downtown Las Vegas unveiled
Derek Stevens reveals Circa hotel-casino in downtown Las Vegas. He plans open by the end of 2020. (K.M Cannon/Las Vegas Review-Journal)
Circa, new casino coming to Fremont Street
Casino owner Derek Stevens announces his new property Circa, coming to Fremont Street in downtown Las Vegas in late 2020. (Michael Quine/Las Vegas Review-Journal)
Dreenk My Oeno makes wine suggestions
At CES 2019 in Las Vegas, the Dreenk My Oeno tells you all about wine.
Polaroid One Step Plus camera unveiled at CES 2019
Polaroid has moved into the digital age with its One Step Plus camera with Bluetooth. With the connected app, it turns your smartphone into a remote for the camera, along with filters and features.
Amazon is everywhere at CES 2019 in Las Vegas
Seemingly everything works with Amazon Alexa
LG Smart Mirror helps you dress snazzy
LG’s Smart Mirror is less of a mirror but more of an assistant to help get you looking snazzy. It takes your image and recommends clothes for you or matches existing clothes with new clothes, which can be purchased right from the mirror. (Mat Luschek/Las Vegas Review-Journal)
Underwater robots make waves at CES 2019 in Las Vegas
Robosea is a company dedicated to underwater robotics. They produce consumer robots for underwater filming as well as commercial products which can be used for underwater research. (Mat Luschek/Las Vegas Review-Journal)
CES 2019 - Victrola record players spin in Las Vegas
A new spin on an old favorite, Victrola record players are meeting a demand for retro products. The brand is also making furnitures with built-in speakers.
CES 2019: Slamtec robots ready to serve
Slamtec is a robotics company out of China whose goal is to provide solutions for laser localization mapping and navigation. They have created two autonomous robots that can be used in areas such as bars, restaurants and malls. (Mat Luschek/Las Vegas Review-Journal)
Mixologiq drink maker appears at CES 2019 in Las Vegas.
This is the Mixologiq drink maker.
CES 2019: Veritable smart garden
Let’s face it; not all of us have green thumbs. And herbs are particularly difficult to grow, considering their constant need for sunshine. Enter the Veritable smart garden from Exky, which does it all for you. (Heidi Knapp Rinella/Las Vegas Review-Journal)
Bonnie Springs Ranch near Las Vegas being sold to developer
Bonnie Springs Ranch near Las Vegas is being sold to a developer, set to close in March. Bonnie Springs, west of Las Vegas off State Route 159 — next to Spring Mountain Ranch State Park — spans more than 60 acres and was on the market for $31 million. The developer and his project partner are under contract to buy the ranch and plan to chop it up mostly into custom-home lots. The plans includes a 25-room motel, a restaurant and a 5,400-square-foot event barn.
Bone-conduction headphones form Aftershokz
Aftershokz offers bone-conduction headphones - headphones that don’t go in the ear.
CES Happy Hour party at Hangover Suite at Caesars Palace
Conventioneers mingled during the Hardware Massive CES 2019 Happy Hour Bash at The Hangover Suite at Caesars Palace in Las Vegas. (K.M. Cannon/Las Vegas Review-Journal) @KMCannonPhoto
Autonomous Cars and Futuristic Aircraft Rule CES
Day two of CES was dominated by autonomous cars and futuristic aircraft in the North Hall of the Las Vegas Convention Center.
TekNekSavr fights neck problems caused by smart phones
Atiya Syverson invented the TekNekSavr to help fight neck and head problems caused by strains while typing on smart phones. (Mat Luschek/Las Vegas Review-Journal)
New eyeglasses know if you fall and call for help
The French company Abeye has created eye glasses that will detect if the wearer falls and call for help. (Mat Luschek/Las Vegas Review-Journal)
Company that creates vibrator-like device claims genders bias against CES
Lora DiCarlo is a women-run start-up that creates a vibrator-like device designed for female pleasure called the Osé. This year they were awarded the CES Innovation Award in the Robotics and Drone Category, but a month later the Consumer Technology Association, which runs CES, rescinded the award and their booth. Haddock and her team believe it is a reflection of gender bias and sexism in an industry with a long history of male domination.
CES-Wagz has new pet products
Wagz has three new products to help create better lives for your pets in a digital world. One is a collar with LTE tracking and an HD camera. Also a smart pet door that only lets your pet in and out. Lastly, a device to humanely keep Fluffy out of certain areas of your home. (Mat Luschek/Las Vegas Review-Journal)
TOP NEWS
News Headlines
Home Front Page Footer Listing
Circular
You May Like

You May Like