Skip to content

News & Knowledge

Design Engineer and All Defendants Defeat Subrogation Claim Over $87 Million Casino Fire

Case Study

Design Engineer and All Defendants Defeat Subrogation Claim Over $87 Million Casino Fire

Goldberg Segalla prevailed on a summary judgment motion that released all defendants from liability in a subrogation action related to an $87 million fire that devastated an Illinois casino complex in 2009. Jim Ozog, David J. O’Connell, and Staci A. Williamson of the firm’s Chicago office represented the design engineer in this case brought by the casino owner and subrogating property insurance carriers against a number of contractors and professionals involved with renovations at the time.

The fire, which eventually destroyed the entire casino, began when a welder was cutting into a kitchen exhaust duct and grease inside the duct ignited. Three carriers paid out nearly $84 million, and the casino owner had deductible expenses of $3 million. The renovations were performed under American Institute of Architects construction contracts that included a broad waiver of subrogation clause. The plaintiffs, in seeking recovery for their losses, argued that the waiver applied only to a builder’s risk policy and alleged willful and wanton misconduct in an attempt to negate the applicability of the waiver altogether.

Based on the strength of our motion for summary judgment, all the defendants stood united and not one cross-claim was filed between them. On March 27, 2015, the Circuit Court of Cook County granted our motion, holding that the clear language of the contract required waiver on all counts as to all parties.

The victory — which saved all the defendants prolonged litigation that likely would have entailed years of discovery and dozens of depositions, given the complex liability and damages questions resulting from a casino loss — highlights the capabilities of Goldberg Segalla’s Professional Liability Practice Group to defend design professionals, engineering firms, and others against complex and high-exposure claims.