MGM Resorts Agrees to Settlement over Cyberattacks
The US District Court for the District of Nevada has granted preliminary approval for a $45 million settlement in a class action lawsuit against MGM Resorts International. The settlement could lead to similar arrangements involving other casino operators who have also been targeted.
LISTEN TO THIS ARTICLE:The lawsuit stemmed from a cyberattack in September 2023 that disrupted the casino operator's operations and another cyber event in 2019 that compromised customer data. Both incidents highlighted vulnerabilities in MGM's cybersecurity protocols and prompted legal action from affected individuals.
Related: MGM Cyberattack to Cost the Company $100 MillionThe settlement agreement outlines a tiered compensation structure for victims of the two ransomware attacks. Victims will be divided into three tiers, with cash payments ranging from $20 to $75 based on the severity of the exposure.
In exceptional cases, individuals who can demonstrate identity theft or related damages may qualify for compensation of up to $15,000. Eligible expenses for this higher compensation tier include legal fees, credit repair costs, and other documented impacts resulting from the breaches.
Additionally, all affected class members may opt for identity theft protection and credit monitoring services, providing an extra layer of security in the wake of the breaches. The law firm Cohen Milstein Sellers & Toll PLLC represented the plaintiffs, emphasizing the need for stricter cybersecurity measures to protect customer data.
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MGM Remiss in Security Oversight
Security concerns at MGM Resorts had been noted before the 2023 incident. BitSight, a cybersecurity ratings and analytics firm, assigned the company a cybersecurity grade of "F" prior to the September attack, underscoring weaknesses in its defenses.
The 2023 cyber intrusion, attributed to a group of hackers known as "Scattered Spider," resulted in significant losses for MGM Resorts. The company reported $100 million in financial losses and incurred an additional $10 million in costs related to mitigating the damage caused by the attack. Unlike other companies targeted by similar attacks, MGM Resorts followed FBI recommendations and chose not to pay the hackers.
This was not the first time MGM Resorts faced cybersecurity challenges. In 2019, hackers accessed sensitive data belonging to 10.6 million customers, including some high-profile individuals, and later sold the stolen information on the dark web.
BetMGM, a sports betting platform partially owned by MGM Resorts, also experienced a breach in 2022, reportedly stemming from an incident earlier that year. These repeated breaches highlighted systemic issues in the company's data security practices, leading to heightened scrutiny from customers and legal representatives.
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