Caesars inks $126 million settlement of insurance coverage dispute

By Caroline Salls

Pittsburgh, Aug. 24 – Caesars Entertainment Operating Co., Inc. requested court approval of a settlement with parent Caesars Entertainment Corp. and designated insurers that resolves a multiparty dispute concerning $140 million in coverage under Caesars’ director and officer insurance policy arrangement.

According to a motion filed with the U.S. Bankruptcy Court for the Northern District of Illinois, the settling insurers have agreed to pay, in cash, 90% of the contracted-for coverage amounts under the respective policies.

In exchange, Caesars has agreed to relieve the settling insurers from any further obligations under the insurance policies.

“This $126 million cash settlement is a vital part of the debtors’ confirmed plan of reorganization and underlies both the cash distributions to creditors and, because cash is fungible, the cash at Caesars that underlies the value of the equity being distributed to the debtors’ creditors under the plan,” the motion said.

“Thus, entry into and approval of the settlement agreement is a key milestone as the debtors work toward emergence from bankruptcy protection.”

A hearing is scheduled for Sept. 13.

Caesars is a Las Vegas-based casino-entertainment company that filed for bankruptcy on Jan. 15, 2015. The Chapter 11 case number is 15-01145.

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