Blackout on the Strip

Even world-class venues are not immune from crisis, as was vividly illustrated in April when Vegas' renowned Bellagio resort suffered a three-day power outage over Easter weekend, displacing hundreds of guests at the 3,008-room property.

At presstime, the cause for the blackout was still undetermined, but it has been reported that the resort's power restoration took a lengthy three days due to that fact that primary power lines and backup lines for alternate power both ran through the same conduit, an internal design problem. Estimates place lost revenues for the MGM Mirage Resorts-owned, Steve Wynn-developed property at more than $3 million.

A public affairs manager for MGM declined to comment on the events and meetings affected by the power loss, but Atlanta, GA-based meetings industry attorney John Foster says the situation at the Bellagio underscores why all parties to a meeting contract should have insurance to cover lost revenue and expenses. "If the Bellagio's power outage was due to a breakdown in the hotel's equipment, then it indicates negligence for which the hotel is responsible to its clients."

Foster says an effective hotel contract should indemnify planners from losses incurred in such an event. "A well-written force majeure clause would cover situations where the outage was outside the control of either party," he explains. "Cancellation clauses protecting both the hotel and the meeting sponsor should also be included in every contract."