Before the Court en banc (Justice Pickering recused). Opinion by Justice Saitta.
Rolf Jensen & Associates, Inc. (“Rolf Jensen”) was hired by Mandalay Corporation (“Mandalay”) to provide consulting services for the construction of an expansion to the casino in compliance with the Americans with Disabilities Act of 1990 (“ADA”). The construction contract called for Rolf Jensen to indemnify Mandalay for damages arising from any act, omission, or willful misconduct by Rolf Jensen in its performance of its obligations. The Department of Justice found post-construction handicap accessibility violations at the casino. Mandalay agreed to retrofit at an estimated cost of $20 million and sued Rolf Jensen for indemnification, breach of contract, breach of express warranty, and negligent misrepresentation. Rolf Jensen argued that claims were preempted by the ADA. Under the ADA, regardless of the intent of an owner of a place of public accommodation, when the facility is not built to be readily accessible to disabled individuals, the owner is liable for the unlawful discrimination. The ADA contains no provisions permitting indemnification or allocation of liability, except in the context of a landlord-tenant relationship. The Court concluded that allowing the indemnification claim would weaken owners’ incentive to prevent violations of the ADA and would conflict with the ADA’s purpose. Owners could use construction contracts to shield themselves from the ADA and ignore their nondelegable ADA responsibilities. The Court further stated that an owner such as Mandalay, a highly sophisticated entity, is in the best position to prevent violations of the ADA. Therefore, the Court ruled that Mandalay’s indemnification claims were preempted by the ADA. However, the Court further ruled that Mandalay’s claims for breach of contract, breach of express warranty, and negligent misrepresentation were also preempted because the damages Mandalay sought only recovery of the retrofitting costs under those claims. The Court ruled that these were simply restated claims for indemnification. Petition granted; district court directed to enter summary judgment in favor of Rolf Jensen. Affirmed in part and reversed in part. (Joseph P. Schrage, Associate in the Las Vegas office of McDonald Carano Wilson LLP).
