MGM tries to use anti-terrorism law to block Las Vegas shooting lawsuit

MGM Resort International's lawsuits against the victims of the 2017 mass shooting in Las Vegas is the first test of a 16-year-old anti-terrorism law.

A legal expert not involved in the case said he believed the law would not apply to most claims. While the action could protect the company from some claims, it depends on a judge invoking an authority that's reserved for the U.S. secretary of homeland security, said Brian E. Finch, a partner at Pillsbury Winthrop Shaw Pittman LLP in Washington, D.C.

"It's a huge overreach," said Finch, who co-chairs Pillsbury's cybersecurity and global security practices. "A court should say, 'This is not our issue. We don't have jurisdiction over this.'"

The complaints for declaratory relief, filed in federal court in Nevada and California, are against more than 1,000 people who were killed or injured when Stephen Paddock opened fire from his room at the Mandalay Bay Resort & Casino into a nearby country music concert.

Many were plaintiffs in personal injury lawsuits filed against MGM filed in Los Angeles County Superior Court. The lawsuits were dismissed, but the plaintiffs have said they intend to refile.

MGM's action, filed Friday in federal court in California by Michael R. Doyen of Munger, Tolles & Olson LLP in Los Angeles, is a proactive attempt to stop that from happening. It seeks a declaratory judgment "that the MGM parties cannot be held liable to defendants for deaths, injuries, or other damages arising from Paddock's attack." MGM Resorts International et al. v. Aase et al., 18-CV06113 (C.D. Cal., filed July 13, 2018).

James J. Pisanelli of Pisanelli Bice PLLC in Las Vegas filed an identical action in federal court in Nevada. MGM Resorts International et al. v. Acosta et al., 18-CV01288 (D. Nev., filed July 13, 2018).

Both cite the Support Anti-Terrorism by Fostering Effective Technologies Act of 2002, or the SAFETY Act, which protects companies from liability in terrorist attacks if they've incorporated certified technology designed to prevent or respond to mass violence.

A company with which MGM contracts for security, Contemporary Services Corporation, is certified by the U.S. Department of Homeland Security under the SAFETY Act, which MGM attorneys argue protects MGM from all liability related to the attack.

"If defendants were injured by Paddock's assault, as they allege, they were inevitably injured both because Paddock fired from his window and because they remained in the line of fire at the concert. Such claims inevitably implicate security at the concert -- and may result in loss to" Contemporary Services Corporation, according to the complaints.

Mark P. Robinson Jr. of Robinson Calcagnie Inc., who represents victims in Nevada state actions that were moved to federal court, said MGM attorneys are "trying to make this a federal case when it's not."

"The whole goal is to get this federal judge to misinterpret the SAFETY Act," Robinson said. "We're not suing, in court cases, the security company. There's no case against them."

U.S. District Judge Richard F. Boulware II in Nevada is to consider a motion from Robinson soon that seeks to remand his case to state court. Sheppard et al. v. Mandalay Bay, LLC et al., 18-CV01120 (D. Nev., filed June 22, 2018).

"All those cases should be in state court in Las Vegas," Robinson said. He added that case law prohibits personal injury plaintiffs from being compelled to litigate their claims in a forum chosen by the defendant.

Finch, who helps companies achieve SAFETY Act certification, said it's unlikely a judge will interpret the law as allowing anyone other than the U.S. Department of Homeland Security secretary declare the shooting a terrorist act, including federal judges. No such declaration has been extended to the Las Vegas massacre.

"That's solely within the discretion of Homeland Security," Finch said.

MGM attorneys did not respond to requests for comment, but their complaints say the law doesn't limit the terrorist act designation to Homeland Security.

"The secretary of Homeland Security may make a determination that conduct in question meets the statutory requirement, but neither the act nor the regulations requires a formal certification. The statute provides that the secretary shall have exclusive authority to certify services, but the authority to determine whether an act of mass violence meets the statutory requirements is not exclusive to the secretary," according to the complaints.

A widely reported statement from an MGM spokeswoman said Congress has designated federal courts as "the correct place for such litigation relating to incidents of mass violence like this one where security services approved by the Department of Homeland Security were provided."

"The federal court is an appropriate venue for these cases and provides those affected with the opportunity for a timely resolution. Years of drawn out litigation and hearings are not in the best interest of victims, the community and those still healing," according to the reported statement.

If the complaints survive the terrorist act designation issue, Finch said MGM won't be protected from all liability. The law could cover some claims relating to the certified contractor's services, but other claims relating to the attack could proceed.

"When we advise clients on whether to do business with SAFETY Act companies, we say 'Look, this is a great marker as to whether that company is qualified and effective,'" Finch said. "But let's be 100 percent clear: This is not going to relieve you from all liability."