The Louisiana resort chain's COVID-19 claims can proceed: Richter – Company Insurance

A Connecticut state judge has refused to dismiss the COVID-19 business interruption lawsuit filed against Zurich Insurance Group by a hotel chain seeking coverage for its Louisiana property, based on reasonable claims of physical loss or damage.

New Castle Hotels LLC, based in Shelton, Connecticut, filed a lawsuit against Zurich in Hartford state court in March, seeking coverage for its properties in Maine, South Carolina, New York, Connecticut, Georgia and Canada, as well as its New Orleans Fairfield Inn Downtown, according to court records in New Castle Hotels LLC v. Zurich American Insurance Co.

In its Tuesday ruling, the court dismissed litigation for everyone but the Louisiana hotel, citing virus exclusion from coverage. Louisiana law does not allow for exclusion, Judge Thomas Moukawsher's decision said.

Zurich "claims that the loss or damage caused by the COVID-19 virus is not 'physical'," the ruling reads. "But can this only be said to be true?"

Connecticut law "only requires a party to advocate" a clear and concise presentation of the material factors on which the plaintiff relies ". New Castle did this, ”the verdict reads.

It claims the virus is "a cause of real physical loss or property damage" and "cites government and private sources to claim the virus is extremely harmful to humans" and can linger on surfaces for up to three days.

"It is also claimed that the physical dimensions of affected physical objects can be microscopically damaged and changed by the virus," the verdict said.

Zurich has asked the court to take legal notice that the virus does not physically change objects, according to the ruling. However, it states: “At this stage, the court simply cannot determine that the virus is not breaking down physical objects, at least on a microscopic level.

“This question has to wait another day – maybe for a summary judgment or after the trial. For the time being, it is important that specific physical damage is claimed, ”the verdict says.

In a demonstrative protest rally at courts that decided otherwise, Judge Moukawsher stated: “The rush to pass judgment in some courts on the question of physical harm – without justification and without evidence – was ill-advised.

"At the moment it would be wrong in this court and for this policy to rush," said the ruling, which allows the lawsuit over New Castle, Louisiana, to continue.

A New Castle attorney did not comment, while Zurich did not respond to a request for comment.

In August, Judge Moukawsher ruled that a Connecticut Native American tribe can recover up to $ 2 million in COVID-19 business interruption losses and cleanup costs under their $ 1.6 billion coverage.

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