While the awful shooting that killed 14 and injured scores more at the Century 16 Multiplex Theater in Aurora, Colorado caused an immense human toll, it’s going to be tough for plaintiffs to collect against the studio or the theater company. The reasons are illuminating, and provide valuable lessons for other venue owners and anyone else who provides access to crowds of people.

As a result, theater and other venue owners across the country are reviewing their own insurance policies, as well as their internal risk management procedures.

At least one suit has already been filed, so far. Torrence Brown, a shooting victim, sued the theater company for failing to place a guard or alarm on the emergency exit door. He is also suing Warner Brothers, claiming the violent movie was contributory to his injury, and the shooter’s doctor.

Legal Hurdles

In one sense, The cinema company’s liability is possibly limited because there was no track record of similar events at the theater to show a pattern of events. No theater company executive or employee could reasonably have foreseen the possibility that a deranged gunman would shoot up the theater. There was no reason to believe the theater was any more at risk for a mass shooting than any other venue hosting a large crowd of people anywhere. There was not even a communication of a threat.

Furthermore, hiring armed security guards over and above the presence of routine local law enforcement patrols is not an ordinary and customary procedure for suburban movie theaters in relatively low-risk areas, though some theater managers will hire off-duty law-enforcement officers for security for special occasions. There simply isn’t much room to demonstrate that the theater owners or managers were negligent in not posting armed guards in or near the theater.

But the exposure is there, nonetheless. Plaintiff’s attorneys will point to the unique nature of the Batman opening, the fact that it was a midnight showing with a large crowd expected, and they will point to the lack of any alarm system or controls on the emergency exit through which the killer left and then reentered the theater.

And experienced trial attorneys know you cannot always trust a jury to make the expected ruling. Juries have minds of their own, and frequently surprise both plaintiff and defense counsel. The risk is there any time a case goes to trial.

Because of the notoriousness of the case, the relatively large number of wounded (who are racking up medical bills), the disabled potentially requiring a lifetime of care and compensation for a lifetime of lost earnings, and the wrongful death related claims on top of that, the potential is there for a huge award is certainly there.

Importance of a High Limit

It’s tough to find good news in the case, but it is fortunate that these kinds of events are so rare. Because of their high-severity and low-frequency nature, public liability insurance against mass casualty events such as the Aurora theater shooting lend themselves well to the insurance solution. Large amounts of liability coverage – sufficient to cover potential claims from an event like this many times over – can still be obtained at a very affordable premium. Because events like this are so rare, there are many, many theater companies paying into the risk pool.

But you do need to be proactive in reviewing your coverage.

We don’t yet know the total potential liability involved in this case. We are still counting the cost of the medical bills, lost wages, and trying to put a dollar figure on the tragic loss of life. But damages of up to $10 million per plaintiff are not totally unimaginable.

Few people can look at the facts of this case and blame the theater staff or ownership. The lack of an alarm system on a door should not result in the bankruptcy and liquidation of a thriving business providing livelihoods to scores of people. That’s where insurance coverage comes in.

Countermeasures

If you own a public venue of any kind, take a good, hard look at your deductibles and insurance benefit caps for a situation such as this. Wargame the scenario: If this happened at your business, could your business survive? Would you become personally devastated because of the actions of a deranged individual beyond your control?

Talk to your insurance agent, and go over the language of your existing general liability insurance policies. You may find you need an additional policy, called a “public liability policy.” This coverage is designed to protect public venues and other businesses that frequently bring in large crowds of people. If something should happen on the premises – a shooting, a structure collapse, an explosion, a terrorist strike –  public liability coverage would provide needed protection your general liability and/or umbrella coverage may not be sufficient to provide.

You may also want to go over your own security measures and emergency response procedures. Do you have adequate security, given your neighborhood and the likely risk? Will it make sense to install metal detectors? Hire additional security, either permanently or for special events? Install security cameras, alarm buttons?

The Department of Homeland Security has created a checklist of measures to take, which theater groups have forwarded to their membership.  But it is up to you to apply common sense to your particular situation, using the facts on the ground, as well as ensure you have insurance coverage adequate to protect your business from catastrophic events such as the Aurora shooting – however remote the likelihood.