Paramount Sues Insurance Company Over $100M Policy Breach of Contract
Written by SOURCE on August 31, 2021
Deadline has learned Paramount filed a lawsuit on Monday accusing Federal Insurance Company of breach of contract after the studio allegedly failed to receive the full amount from its $100 million policy due to COVID-related production stoppages and setbacks while filming Mission: Impossible 7.
“Paramount suffered significant losses and damages covered by the Policy when it was forced to suspend and postpone production of Mission Impossible 7 due to Closure Orders affecting different filming locations, cast illnesses, and the need to protect cast and crew and its locations from exposure to SARS-CoV-2,” the suit reads.
Deadline reports production of M:I 7 was suspended in February 2020, again the following month, and twice in October 2020 when “a covered person” in the crew became ill. A quarantine order by the Italian and UK government, as well as additional positive tests “among cast and crew” resulted in a total of seven shutdowns.
In December, audio leaked of Tom Cruise screaming at crew members for violating COVID-19 protocols, and threatening to fire them if it happens again. Cruise reportedly bought two robots after his tirade towards the crew to ensure that everyone abided by protocols. Considering there had been at least four pauses prior to the Mission: Impossible star’s profanity-laden rant, his frustration over members of the crew risking another interruption in production by not following the rules makes more sense.
When Paramount attempted to recoup its financial losses under its insurance policy, Federal allegedly rejected the studio’s request, and to date, has only given them $5 million. “Federal arbitrarily categorized several of Paramount’s losses as subject to only one limited category of coverage (which provided for coverage of just $1 million in connection with each single loss), and unjustifiably refused to cover other losses altogether,” the suit reads.
The studio is seeking an unspecified amount of damages.
Mission: Impossible 7 is scheduled to hit theaters next year on May 27, 2022.
