New York judge dismisses restaurant chain COVID-19 BI lawsuit


A New York judge has agreed to dismiss the COVID-19 business disruption litigation filed by a Dallas-based restaurant chain against a unit of Swiss Re Ltd.

New York Supreme Court judge Jennifer G. Schecter sacked Consolidated Restaurant Operations Inc. v. Westport Insurance Corp. in a one-page order Wednesday.

Consolidated Operations said in a complaint filed in August 2020 that it operates 27 full-service restaurants and 27 franchise restaurants in 12 states and the United Arab Emirates. He said he purchased $ 50 million in event business interruption insurance from Westport which covers “all perils”.

The complaint against Westport had “given all indications that it would not cover losses resulting from the pandemic.” Its main position is that neither the virus nor the disease that comes with it causes physical loss or property damage, as this terminology is insured in the all-risk policy. “

“This position violates the ordinary meaning of cover language and case law in New York and across the country interpreting the same or similar language,” the channel said in its complaint, which accused the insurer of breach of contract. .

Westport said in a court filing in May that 16 New York courts, including four state courts and 12 federal courts, “have unanimously concluded that the termination is entirely appropriate because the actual or suspected presence of COVID-19 is not “direct physical loss or damage” to property sufficient to trigger coverage. “

Last month, a New York City federal district court dismissed a COVID-19 business disruption litigation filed by a New York health care system against units of American International Group Inc. and Allianz SE, asserting that the losses were not caused by direct physical loss or damage, as required. by the cover.

About James Almanza

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