In a recent turn of events, Kevin Spacey has agreed to pay $1 million to MRC, the production company behind 'House of Cards,' in order to settle the sexual harassment claims made against him by young male staffers on the show. The allegations led to Spacey's removal from the final season of the popular television series in 2017. Prior to this settlement, Spacey faced a potential $31 million judgment, as an arbitrator had deemed the allegations credible and ruled in favor of MRC, stating that they deserved to recoup their costs of scrapping the final season and rebuilding it without Spacey.
Under the terms of the agreement, Spacey will make payments over several years, with each installment being equal to 10% of his after-tax income. Additionally, Spacey has committed to cooperating with MRC in their efforts to recover the remaining balance of their costs through their insurance company. MRC had filed a lawsuit against Fireman's Fund and Lloyd's of London in April 2022, arguing that Spacey's absence from the show was covered by their cast insurance policies. Cast insurance is typically obtained by productions to protect themselves in the event that a key actor becomes unable to perform due to illness or other circumstances.
MRC contended that Spacey's decision to check himself into a treatment facility for sex addiction after news broke about the allegations qualified as a sickness that should trigger coverage under the insurance policies. However, Judge Mark Epstein dismissed MRC's insurance lawsuit twice, first in April 2023 and again in November. In his November ruling, Judge Epstein stated that the contracts did not appear to have intended coverage for this particular type of claim.
Despite these setbacks, MRC was granted permission to amend their lawsuit against Fireman's Fund by the judge, who had noted deficiencies in their previous filings. However, before the deadline to file the amended suit, MRC reached an agreement with Spacey. As part of the deal, the amount owed by Spacey was reduced from $36 million (including accrued interest) to $1 million. In return, Spacey agreed to testify in the insurance case, undergo examinations by doctors for both sides, and provide his medical records within 10 days.
Armed with this newfound information, MRC filed the amended lawsuit against Fireman's Fund on January 2. The updated complaint alleges that Spacey was being treated for anxiety and depression, which rendered him unavailable for production. Fireman's Fund, however, swiftly filed a motion last week seeking to dismiss the amended complaint, deeming it 'absurd.' The insurer argued that MRC's position contradicted their claim in the arbitration case against Spacey, where they had asserted that he was dropped from the show due to violating the company's sexual harassment policy, not because of illness.
In a previous ruling, Judge Epstein had suggested that if MRC could demonstrate that Spacey suffered from debilitating depression, it would align more closely with the policies' definition. Fireman's Fund accused MRC of taking this as an opportunity to invent new facts, noting that six years had passed since the alleged loss occurred and MRC had yet to provide a consistent description of why Spacey was removed from 'House of Cards.'
The settlement between Spacey and MRC was initially reported by Puck and has brought some closure to this contentious legal battle. However, the case against Fireman's Fund continues, with the insurer contesting MRC's claims and arguing that the company has lost sight of the truth throughout the course of this ordeal. Recently, Fireman's lawyers made a request to have confidential information redacted and sealed in their filings to the court.
As this complex legal saga unfolds, it remains to be seen how the courts will ultimately decide on the cast insurance coverage and liability in relation to Kevin Spacey's departure from 'House of Cards.' The settlement between Spacey and MRC, though a major development, is just one piece of a much larger puzzle that has captivated both the entertainment industry and the public's attention.
