Crown Sues Insurer RiverStone Over Cover for Its A$72.5m Shareholder Class Action Settlement

Crown Resorts says an excess insurer holding half of two layers of its directors' and officers' cover has refused to pay towards the settlement of the class action over its money laundering failures. With A$27.5 million still due to shareholders next May, the claim is about cash as much as principle.

• Crown Resorts has sued RiverStone International in the Supreme Court of Victoria, claiming the insurer has refused to pay under excess policies that Crown says cover its A$72.5 million (approximately $51 million) shareholder class action settlement, according to The Sydney Morning Herald
• RiverStone held 50% of the risk on the fourth and fifth layers of Crown's directors' and officers' insurance; the primary insurer, AIG, paid A$7.5 million (approximately $5.3 million) before its layer was exhausted, the newspaper reported
• Crown claims RiverStone and other insurers told it to act as though it was uninsured while it negotiated the settlement; RiverStone has not yet filed a defence and declined to comment
• The settlement, approved by Justice Nichols in September 2025, ended a class action alleging Crown misled the market about its anti-money laundering compliance, and is being paid in three instalments, the last of A$27.5 million due by 10 May 2027
• It is the second shareholder settlement for Crown in Australia, after a A$125 million (approximately $88 million) Federal Court settlement in 2022, and follows a A$450 million (approximately $316 million) AUSTRAC penalty in 2023

Crown Takes Its Excess Insurer to Court

Crown Resorts, owned by Blackstone since 2022, has filed proceedings against the run-off insurer RiverStone International in the Supreme Court of Victoria over its refusal to fund part of a shareholder class action settlement, The Sydney Morning Herald reported, in an account followed by Casino.org on 29 September. According to the report, Crown held several layers of directors' and officers' insurance. Its primary insurer, AIG, paid A$7.5 million before that layer was exhausted. RiverStone held 50% of the risk on the fourth and fifth excess layers and has refused to pay.

In its filing, Crown claims that RiverStone and other insurers told it to act as though it was uninsured during the negotiations that produced the settlement, according to the newspaper, which said it was not clear why that instruction was given. Crown is seeking payment under the excess policies plus interest. The Herald said the documents did not disclose how much Crown believes RiverStone owes; InsuranceAsia News reported the claim at A$22.5 million (approximately $16 million). RiverStone has yet to file its defence and declined to comment, and Crown did not respond to the newspaper's requests for comment. The claims are Crown's and have not been tested in court.

RiverStone specialises in acquiring and managing legacy, or run-off, insurance liabilities. Founded in 1999 as the run-off arm of Fairfax Financial, its international business was bought by funds managed by CVC Capital Partners in 2021, according to CVC. The reports do not say whether RiverStone wrote Crown's policies or took them on as part of a legacy portfolio.

The Settlement Crown Is Still Paying

The underlying case is Lieberman v Crown Resorts Ltd, a group proceeding filed by the law firm Maurice Blackburn in December 2020 on behalf of people who bought or held Crown shares between 11 December 2014 and 18 October 2020. It alleged that Crown made misleading statements about its compliance with anti-money laundering and counter-terrorism financing laws, particularly in its VIP international business and its junket programme, and breached its continuous disclosure obligations, according to the court's case page. The claim followed the fall in Crown's share price after it announced on 19 October 2020 that AUSTRAC had begun a formal enforcement investigation into Crown Melbourne. Crown settled without admitting liability, according to the Herald.

Under a settlement deed dated 9 May 2025, Crown agreed to pay A$72.5 million in three instalments: A$20 million (approximately $14 million) already paid when the settlement was approved, A$25 million (approximately $17.6 million) by 11 May 2026 and A$27.5 million (approximately $19.3 million) by 10 May 2027. Justice Nichols approved it on 19 September 2025, finding it "a fair and reasonable compromise", and put its net present value at about A$69.8 million. The deed requires no security from Crown for the later instalments; if it defaults, the remaining payments fall due at once and the group members' claims survive.

The judgment explains why the payments were spread out. It records evidence that the financial reports of Crown and its parent disclose "substantial ongoing trading losses, negative operating cashflows and declining net assets", and that several "very substantial regulatory fines" have been imposed on Crown Melbourne and Crown Perth since about mid-2022. The largest was the A$450 million penalty the Federal Court ordered in July 2023 for breaches of the anti-money laundering law, according to AUSTRAC. Crown had already been censured in Victoria over its mandatory pre-commitment system in 2025.

Crown Is Paying a Bill It Bought Insurance to Cover

The dispute matters because of the timetable. Crown still owes A$27.5 million under the deed by May 2027, and a court has recorded that it is loss-making with negative operating cash flow. Directors' and officers' towers exist so that a securities class action is funded largely by insurers, and on the Herald's account the primary layer paid A$7.5 million, about a tenth of the settlement; the report does not say what the second and third layers have paid. Every excess layer that does not respond is money Crown or Blackstone must find. Whatever the precise sum at stake with RiverStone, the case tests whether the rest of the tower will pay at all.

The "Act as Though Uninsured" Instruction Is the Heart of the Case

Liability policies commonly require an insured to behave as a prudent uninsured party would when it settles, so that a company does not agree an inflated sum on the assumption that insurers will pay. If insurers told Crown to negotiate on that footing, Crown will presumably say it did exactly what it was told and settled at a figure a judge later called fair and reasonable. RiverStone's defence, when it comes, will show whether it disputes the settlement's reasonableness, its own consent, the allocation of the loss, or whether the claim falls within the policies at all. Until then, only Crown's side of the argument is on the record.

The Cost of Crown's AML Failures Keeps Arriving Years Later

The conduct at the centre of the case ended in 2020. Since then Crown has faced state inquiries, a A$450 million AUSTRAC penalty, two shareholder settlements totalling A$197.5 million and now litigation with its own insurers over who pays. That long tail is the lesson for the sector: the fine is only the first bill, and D&O insurance is priced and disputed on the basis of exactly this kind of history. Rival Star Entertainment's troubles in Sydney suggest the Australian casino market is not yet through the cycle, and insurers underwriting operators with open regulatory files are likely to watch how Crown's case ends.

Crown settled with its shareholders more than a year ago. It is now finding out whether its insurers settled with it.