MGM Sues To Block U.S. Federal Trade Commission’s Probe

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MGM Resorts International has sued the U.S. Federal Trade Commission (FTC) to block the commission’s probe into data security.

This legal battle originates from a severe cyberattack last year, which led to widespread disruption across MGM’s network, affecting everything from hotel room access to slot machine operations.

Continue reading to learn about the legal battle influencing cybersecurity and privacy practices across the corporate world in the U.S.

Legal Battle Lines Drawn

lawsuitThe center of the controversy is MGM’s lawsuit against the FTC, which seeks to stop an investigation into the incident.

MGM grounds its legal stance, filed on April 15, 2024, in Washington D.C.’s federal court, in defending its Fifth Amendment rights.

MGM claims that the FTC’s demands for extensive information on its data security practices overreach.

It is especially extensive since MGM is not a traditional financial institution.

MGM’s lawsuit includes several significant allegations against the FTC:

  • Violation of Fifth Amendment Rights: MGM argues that the FTC’s actions and the nature of its investigative demands undermine MGM’s rights to due process and fair treatment under the law.
  • Conflict of Interest: The suit highlights a potential conflict of interest involving FTC Chair Lina Khan, who was personally affected by the cyberattack during her stay at an MGM property.
  • Request for Judicial Intervention: MGM seeks a court order to prevent Chair Khan from participating in the investigation and to recognize that certain regulatory rules (like the Safeguards Rule and Red Flags Rule) aren’t applicable to MGM’s operations.

About MGM’s 2023 Cyberattack

MGM cyberattack lawsuitThe chaos began when MGM was hit by a massive cyberattack in September 2023, reportedly carried out by the hacker group Scattered Spider.

The group claimed responsibility shortly after the incident, threatening further disruptions unless their ransom demands were met.

This left MGM in a risky situation, balancing operational recovery with the threat of continued cyber assaults.

The incident obstructed the real-time experiences of guests and staff during the attack.

With systems down, hotel employees had to revert to pen-and-paper methods for guest check-ins.

Also, it was a harsh reminder of the vulnerability of even the most sophisticated tech infrastructures.

This human aspect underlines the broader implications of cyber security and data protection in today’s computer age.

Financial And Operational Repercussions

The cyberattack’s impact was not just a temporary operational error but had serious financial implications.

 

MGM estimated $100 million in lost revenue due to the attack, with additional millions spent on recovery efforts.

Despite the financial challenges, MGM reported a record revenue of $3.97 billion in the third quarter of the same year, showcasing resilience in the face of adversity.

MGM’s lawsuit against the FTC is a test of the boundaries of regulatory oversight and the protection of corporate rights against government intrusion.

The outcome of this legal battle will definitely affect MGM and the U.S. Federal Trade Commission.

Moreover, it could also influence cybersecurity and privacy practices across the corporate world.

This case serves as a compelling study on the balance between regulatory oversight and corporate autonomy.

 

MGM Resorts International has filed a lawsuit against the U.S. Federal Trade Commission to block a probe into its data security practices following a cyberattack.

The cyberattack on MGM occurred in September 2023.

The hacker group named Scattered Spider claimed responsibility for the 2023 cyberattack on MGM.

The cyberattack disrupted MGM’s operations, affecting hotel room access, slot machine operations, and forced staff to revert to manual processes for guest services.

MGM claims that the FTC’s investigative demands violate their Fifth Amendment rights to due process and fair treatment.

The lawsuit mentions a conflict of interest involving FTC Chair Lina Khan, who was personally affected by the cyberattack during her stay at an MGM property.

MGM estimated a loss of $100 million in revenue due to the cyberattack.

Despite the cyberattack, MGM reported a record revenue of $3.97 billion in the third quarter of 2023.

The outcome could redefine the boundaries of regulatory authority and corporate privacy rights, affecting both MGM and broader industry practices.

Gita Puikevica-Puikevska is a dedicated content creator based in Riga, Latvia. Her degree in technical translation and passion for music mirrors her creative approach to content writing. She is committed to keeping players informed with the latest gambling-related news and insights. Gita's commitment to promoting responsible gambling practices in the United States showcases her dedication to making a positive impact in the online gambling community.

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