Summary
The Nevada Supreme Court considers an original petition for a writ of mandamus concerning whether the Americans with Disabilities Act preempts state-law indemnification and related claims brought by an owner that admitted ADA violations. The court holds that indemnification claims, and contract, warranty, and negligent-misrepresentation claims functioning as de facto indemnification claims, are preempted because they undermine the ADA’s objectives. The court grants the petition and directs the district court to grant summary judgment for Rolf Jensen.
Topics
Practice areas
Questions Presented
- Whether the Nevada Supreme Court should exercise extraordinary writ jurisdiction to review the denial of summary judgment.
- Whether the ADA preempts a state-law indemnification claim by a public-accommodation owner seeking recovery for its own admitted ADA violations.
- Whether contract, express-warranty, and negligent-misrepresentation claims seeking recovery of the same retrofit costs are de facto indemnification claims preempted by the ADA.
Holdings
- The court exercised its discretion to entertain the mandamus petition because an appeal was not a speedy or adequate remedy and the ADA preemption issue was an important nationwide legal question requiring clarification.
- The ADA preempts state-law indemnification claims brought by owners of places of public accommodation to recover costs arising from their own ADA violations because those claims pose an obstacle to the ADA's objectives.
- Claims labeled breach of contract, breach of express warranty, and negligent misrepresentation are preempted when their substance and requested damages derive solely from the owner's first-party liability for its admitted ADA violations and seek recovery of the costs of correcting those violations.
Key quotations
“Accordingly, we conclude that Mandalay’s claims for breach of contract, breach of express warranty, and negligent misrepresentation are de facto claims for indemnification and thus are preempted by the ADA.” (at 453)
“We conclude that Mandalay’s state law claims for indemnification pose an obstacle to the objectives of the ADA and therefore are preempted.” (at 453)
Factual background
Rolf Jensen contracted with Mandalay Corporation to provide ADA-compliance consulting services for the construction of an expansion to the Mandalay Bay Resort and Casino. After the Department of Justice investigated numerous ADA accessibility violations, Mandalay entered into a settlement requiring it to retrofit the Resort, at an estimated cost exceeding $20 million. Mandalay sued Rolf Jensen to recover those costs under indemnification, contract, warranty, and negligent-misrepresentation theories, while admitting that it was liable for the ADA violations.
Procedural history
Mandalay sued Rolf Jensen in Nevada district court to recover the anticipated costs of retrofitting the Mandalay Bay Resort and Casino to comply with the ADA. After preliminary motion practice, claims for express indemnification, breach of contract, breach of express warranty, and negligent misrepresentation remained. The district court denied Rolf Jensen's motion for summary judgment, and Rolf Jensen petitioned the Nevada Supreme Court for extraordinary relief. The Supreme Court exercised its discretion to entertain the petition, granted the writ, and directed the district court to grant summary judgment for Rolf Jensen.
Remand instructions
The clerk was directed to issue a writ of mandamus instructing the district court to grant Rolf Jensen's motion for summary judgment. The court also vacated its prior stay.