Commitments and contingencies

9 Months Ended

Sep. 30, 2011

Commitments and contingencies [Abstract]

Commitments and Contingencies Disclosure

Commitments and contingencies

Litigation. From time to time, the Company is a party to litigation, most of which arises in the ordinary course of business. The Company is not currently a party to any litigation that management believes would be likely to have a material adverse effect on the financial position, results of operations or cash flows of the Company.

Reference is made to the legal proceedings reported under the caption “East ChicagoLocal Development Agreement Litigation” in Item 3 of Part I of the Company’s Annual Report on Form 10-K for the year ended December 31, 2010, as updated in Item 1 of Part II of the Company’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2011. In accordance with the previously reported settlement reached by the parties, on September 29, 2011, the two lawsuits in which the Company was a defendant were dismissed with prejudice (except for certain claims not involving the Company).

Reference is made to the legal proceedings reported under the caption “St. Charles Hotel Project Construction Litigation” in Item 3 of Part I of the Company’s Annual Report on Form 10-K for the year ended December 31, 2010. On November 3, 2011, the Company entered into an agreement in principle to settle its pending litigation with Walton Construction Company, L.L.C. (“Walton”). The litigation relates to the Company’s November 2005 contract with Walton for the construction of the 397-suite hotel and related amenities at Ameristar St. Charles. The Company agreed to pay $9.25 million upon the execution of a mutual release and settlement agreement and dismissal of all claims arising out of or relating to the construction contract or the project. The payment has been accrued in the consolidated financial statements as of September 30, 2011 as a construction payable with a corresponding increase to the fixed asset carrying values associated with the St. Charles project.

Self-Insurance Reserves. The Company is self-insured for various levels of general liability, workers’ compensation and employee health coverage. Insurance claims and reserves include accruals of estimated settlements for known claims, as well as accrued estimates of incurred but not reported claims. At September 30, 2011 and December 31, 2010, the estimated liabilities for unpaid and incurred but not reported claims totaled $10.0 million and $10.8 million, respectively. The Company considers historical loss experience and certain unusual claims in estimating these liabilities. The Company believes the use of this method to account for these liabilities provides a consistent and effective way to measure these highly judgmental accruals; however, changes in health care costs, accident or illness frequency and severity and other factors can materially affect the estimates for these liabilities.