Nation’s 1st COVID-19 Business-Interruption Suit Headed to Trial [Update]

By Jim Sams | November 12, 2020

  • November 12, 2020 at 2:48 pm
    Roy A. Mura says:
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    I wonder whether Loyd’s will call John Houghtaling himself as a trial witness to tell the judge WHY NOLA Mayor Cantrell’s emergency declaration, filed on the same day that Houghtaling filed this lawsuit — March 16, 2020 — (which was even before the claim was denied, btw), stated that COVID-19 “caus[es] property loss and damage in certain circumstances”.


    “Because the coronavirus contaminates surfaces, it’s property damage,” Houghtaling said.

    That argument appeared to get an immediate boost from New Orleans Mayor LaToya Cantrell, who filed an emergency declaration in the same civil court Monday directing restaurants to limit operations to take-out and delivery service. The declaration specifically says the COVID-19 virus “caus(es) property loss and damage in certain circumstances.”

    At a news conference Monday afternoon, Cantrell said she and her administration specifically wanted to address the business interruption insurance issue.

    “We have also been very aggressive as it relates to business interruption support and … insurance,” Cantrell said. “We understand pandemic infections are not included in their insurance coverage, which makes this a priority for my administration to push for these reasons at the state and federal level.”
    On March 20, 2020, Executive Director and General Counsel Jonathan Wilkofsky wrote this to the members of the New York Public Adjusters Association:

    “At the urging of our partner, Jon [sic] Houghtaling, on March 16th Mayor DeBlasio of New York City issued an Executive Order adopting our proposed language relating to the closure orders to “property damage” caused by the virus’ contamination of surfaces. This language will be extremely helpful for policies without a virus exclusion.”

    My tallies are a bit different from Prof. Baker’s but I believe insurers are now leading 11-8 in the category of cases dismissed when there is no virus exclusion. My rulings metrics as of yesterday are here:

    Regardless, this will be an interesting trial to “watch”. Thank you for reporting this.

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