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In November 2023, Media Right Capital, the production company House of cardsHis back was against the wall. A court has just dismissed claims against MRC’s insurer over a nine-figure payout in connection with the show’s sixth season for the second time. The judge supervising the case warned that there would be another bite of the apple, not a fourth. The MRC needed a new legal strategy.
Enter Kevin Spacey, who was on the hook for more than $31 million to MRC for breaching his contract by violating anti-harassment policies. There was some disagreement between the two sides, but Spacey had something the production company desperately needed in its case against the insurance company Fireman’s Fund: the star’s cooperation. Up until that point, the court had not accepted arguments that the actor was too ill to film. It was a big problem, and one that the MRC likely couldn’t have solved without Spacey in its efforts to get some money back from it House of cards‘The final season is a disaster.
So the production company ended up making a deal for him to become the state’s witness. In exchange for the arbitration award being reduced to $1 million, Spacey agreed to hand over his medical records and file a court declaration that he would probably kill himself if he had to return for the final season of the show (more details sealed). This confession changed the nature of the case. Now, a trial is underway that will decide whether MRC is owed more than $100 million.
The question at the heart of the case: What actually killed Spacey’s appearance in the show’s sixth season? If you ask MRC, it’s because of the actor’s sex addiction, which he confirms is an illness that led to him being unavailable after he checked himself into a luxury rehab facility in Arizona. But if you ask the Firefighters Fund, it’s because of the media fallout in response to sexual assault allegations. An MRC win will have major implications for production insurance coverage moving forward.
Under this policy, MRC was covered for losses related to “disease”, which was not defined under the terms of the contract and would be a key focus of the trial. MRC has already produced five seasons of the series House of cards Starring Spacey, who by the end of season five is President of the United States and running for re-election. By the time the accusations against him came to light, the first two episodes of the sixth season had already been filmed.
The schedule is important. To rewind: A BuzzFeed report published on October 29, 2017 detailed alleged sexual abuse and assault by Spacey over several decades. It was an entirely hands-on situation for MRC, which resulted in production shutting down two days later. On November 2, CNN published a report accusing Spacey of sexual assault, this time against crew members. As the accusations spread, the actor himself checked into The Meadows, a $28,000-a-month rehab facility, that same day. At that point, MRC was operating under the belief that Spacey would not be able to appear for season six and announced his suspension the next day.
But this is where a large part of the controversy arises. Spacey’s lawyer, Todd Rubinstein, told the production company on November 4 that the actor is “available, willing and able to provide all services” required under his contract. This contradicted an earlier confirmation from his agent, Matt Delpiano, to MRC CEO Scott Tinley two days earlier that Spacey was “sick” and would be gone for a “very long” period, at least six months. Ultimately, MRC scrapped the existing script and created an entirely new story, taking Spacey’s character out of the show entirely.
How much weight will jurors give to Rubinstein’s position that Spacey would leave rehab to film if the MRC requests it? We’ll see, but any good entertainment lawyer would have said the same thing to preserve their clients’ rights in this type of situation, especially when there is a pay-or-play obligation. Tenley certainly didn’t believe it. “Thanks to goodness, I believed [Rubenstein] “It was just taking a legal position,” he testified.
At trial, the Firefighters Fund will argue that the MRC’s suspension of Spacey was a business decision. This is where Netflix comes into the fold. Under the distribution deal, she had so-called “tie-breaking” rights over the script, story and cast. Netflix allegedly exercised those rights on November 3 in the wake of the CNN report, with the company also refusing to release the Spacey movie starring him. Gore Around that time, according to court filings. The Firefighters’ Fund says the company has threatened not to air new episodes of the series House of cards If MRC stuck with Spacey, who was suspended later that evening. In fact, Pauline Micheli, MRC’s former head of television legal and business affairs, testified that the spinoff rights had “everything to do with” removing Spacey’s character.
However, the MRC maintains that Netflix has never exercised these rights. Tinley stuck by that decision, at one point answering affirmatively when asked if Spacey was “a monster in terms of the people he victimized” and referring to an unspecified complaint against the actor during the series’ first season.
One question jurors may have to consider is whether or not it’s Netflix Effectively It exercised its tie-breaking rights by threatening not to distribute new episodes even though it may not have done so officially I practiced them. If so, they would likely buy arguments from the Firefighter’s Fund that Spacey was suspended not because of any “illness” but because of a potential blowback for allowing him to stay.
During the trial, Spacey is expected to admit that he was unable to work when the sexual assault allegations first surfaced despite his statements to the contrary in the immediate aftermath of the situation. He will likely certify that his illness requires ongoing treatment. The MRC has presented a slew of evidence that it says shows Spacey could not and should not have returned to the set during that period of his life.
This leads to the toughest question the jury will face: Are the MRC losses from Season 6 of the show directly related to Spacey’s illness? The policy states that any loss must be caused “solely” by illness. This may seem like a winning case for a firefighter’s fund, but the courts have recognized that the situation can give rise to the problematic behavior at the heart of an insurance dispute.
Consider a hypothetical insurance dispute involving Bruce Willis, who continued to act out as his dementia worsened. If he is found in breach of his contract after forgetting lines or behaving inappropriately, it can be argued that his poor performance was the cause of that breach. An equally strong argument can be made that dementia is the real cause because his actions are manifestations of his condition. That’s what the MRC discusses here: Spacey’s behavior, his need for treatment and the risks he poses if he continues to film Season 6 are all direct results of his illness.
Spacey’s take on the situation will grab the headlines, but an MRC win on this point could leave insurers scrambling to rework the fine print. After all, why would they take all the risk that a production would cast an actor with a history of sexual misconduct when they could just claim that any losses were caused by sex addiction?
