The producer of “House of Cards” has lost an insurance trial over $29 million in production costs incurred due to the firing of Kevin Spacey in 2017.
The producer, Media Rights Capital, argued that its losses should have been covered under Spacey’s cast insurance policy, which would pay out if Spacey was unavailable due to sickness. The producer’s lawyers argued that Spacey was suffering from sex addiction.
After a five-week trial in Santa Monica, a jury found on Tuesday that Spacey’s alleged illness was not the primary reason for his departure from the show, and that therefore the insurer owed nothing. Fireman’s Fund argued that MRC actually dropped Spacey due to bad publicity.
“Fireman Fund’s intent in issuing this coverage is to cover exactly the expenses which the policy says it covers,” said attorney Leon Gladstone, who represented the insurer. “The jury upheld that intent in finding that MRC’s business decision to sever ties with Spacey would not be covered.”
Spacey was fired shortly after reports emerged about his sexual misconduct during the #MeToo movement in late 2017. His character was written off the sixth season of the show, and two episodes had to be scrapped. The final season ran to just eight episodes rather than 13. Spacey went to get treatment at The Meadows, an Arizona facility that deals with sex addiction.
Spacey testified at the trial, stating that while he was diagnosed with sexually compulsive behavior, he did not believe the diagnosis was correct.
MRC won a $31 million arbitration award against Spacey in 2021, after an arbitrator found he had violated the company’s sexual harassment policy. The company later sued Lloyd’s of London and Fireman’s Fund, on the theory that they should pay its costs under their cast insurance policies. Lloyd’s was dismissed from the case early on.
In order to pursue its claims against Fireman’s Fund, MRC needed evidence of a diagnosis, but Spacey refused to turn over his medical records. So MRC struck a deal with Spacey, whereby he would cooperate on the insurance case in exchange for a reduction in the arbitration award from $31 million to $1 million.
In the settlement, Spacey agreed to pay out the $1 million over a period of years in installments equal to 10% of his after-tax income.
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