Kevin Spacey will pay $1 million to MRC, the production company behind “House of Cards,” to settle claims that he sexually harassed young male staffers on the show.
Spacey was dropped from the final season of the show in 2017. He was facing a $31 million judgment in the case, after an arbitrator found that the allegations were credible and that MRC deserved to recoup its costs for scrapping the final season and starting over without him.
Spacey has agreed to pay the $1 million over multiple years in installments equal to 10% of his after-tax income. MRC has also secured Spacey’s cooperation in trying to recoup the balance of its costs from someone better able to pay: its insurance company.
In April 2022, MRC sued Fireman’s Fund and Lloyd’s of London on the theory that Spacey’s absence from the show was covered by their cast insurance policies.
Productions obtain cast insurance to protect themselves in case a key actor becomes too sick to perform. In this case, MRC noted that shortly after CNN and other outlets reported on Spacey’s alleged misconduct, he checked himself into the Meadows, a facility in Arizona that provides treatment for sex addiction. The company has argued that qualifies as a sickness that triggers the policies.
Judge Mark Epstein has twice thrown out MRC’s insurance lawsuit, first in April 2023 and again in November. In November, the judge wrote that it appeared the contracts “were not meant to cover this sort of claim.”
“The court is left with the conclusion that these policies just do not insure against this particular risk, and that neither party was really contemplating coverage for this sort of thing at the time the policies were signed,” Epstein wrote.
The judge dismissed the case entirely with respect to Lloyd’s, but allowed MRC to make one more attempt to amend the lawsuit against Fireman’s Fund.
Among other deficiencies in the suit, the judge has noted that MRC failed to specify Spacey’s ailment, and to explain precisely how it would stop him from performing.
MRC was hampered on that front because Spacey had fought its attempt to subpoena his medical records, and also refused to cooperate with the insurance investigation.
But on Dec. 18 — two weeks before the deadline to file the amended suit — MRC made its deal with Spacey.
MRC agreed to lower the amount Spacey owed from $36 million — including accrued interest — to $1 million. In exchange, Spacey agreed to testify in the insurance case, to be examined by doctors for each side, and to provide his medical records within 10 days.
Armed with new information, MRC filed the amended suit against Fireman’s on Jan. 2. The new complaint alleges that Spacey was being treated for anxiety and depression, and that he was therefore unavailable for production.
Fireman’s filed a motion last week to throw out the amended complaint, saying it “borders on the absurd.”
The insurer argues that MRC’s position is a “180-degree pivot” from its claim in the arbitration case against Spacey — in which the company argued that Spacey was dropped because he had violated the company’s sexual harassment policy, not because he was ill.
In a footnote to his November ruling, the judge had offered that if MRC could allege that Spacey was suffering from debilitating depression, that “would fit far more comfortably within the policies’ definition.”
The insurer argued that MRC took that footnote “as a license to invent new facts.”
“Six years have passed since the loss allegedly occurred. Plaintiffs have yet to present a consistent description of what caused them to remove Kevin Spacey from HOC. Instead, they are still running through the range of possible – albeit inconsistent – scenarios on which to blame their loss,” Fireman’s lawyers wrote. “After years of trying to state a theoretically viable claim, it seems that they’ve completely lost sight of what actually occurred and their obligation to plead the truth.”
The settlement was first reported on Monday by Puck.
On Tuesday, Fireman’s lawyers informed the court that they had inadvertently failed to redact confidential information from their recent filings, and asked that those documents be sealed.