A Washington state court in The Board of Regents of the University of Washington v. Employers Insurance Company of Wausau, No. 22-2-15472-1, recently held that the University of Washington has made a plausible claim for coverage for losses sustained as the result of the outbreak of the COVID-19 pandemic under Washington’s “loss of functionality” test.Continue Reading Invisible Particles or Not: Coverage May Exist for COVID Claims

Sanctions are an extreme remedy; frequently sought, but seldom granted.  Such was the case in Hunton Andrews Kurth LLP’s action on behalf of hotel and casino, Treasure Island, LLC (“Treasure Island”), against Affiliated FM Insurance Company (“AFM”) in federal court in Nevada, where AFM “hid” documents which refute the insurer’s defense on the central disputed issue in Treasure Island’s case—and many more actions seeking insurance coverage for losses arising from the COVID-19 pandemic.  A copy of the sanctions order can be found here.Continue Reading Insurer’s Failure to Produce Plainly Relevant Documents Draws Sanctions

Earlier this month, the Eighth Circuit remanded a COVID-19 insurance recovery case to the district court on jurisdictional grounds. See Great River Ent., LLC v. Zurich Am. Ins. Co., No. 21-3815, 2023 WL 5839565 (8th Cir. Sept. 11, 2023). The Eighth Circuit’s decision underscores federal courts’ continued scrutiny of subject matter jurisdiction—especially in complex cases involving limited liability companies.
Continue Reading A Great River of LLC’s: The Eighth Circuit’s Take on Properly Assessing Diversity Jurisdiction

In a COVID-19 insurance coverage lawsuit that Hilton Worldwide Holdings, Inc. filed against several insurers in Nevada state court, two recent rulings in favor of Hilton highlight the importance of strategic decisions early in a case. Continue Reading Nevada State Court Rulings Highlight Importance of Strategic Decisions Early in a Case

On February 6, 2023, The Claims Journal highlighted a letter by members of Hunton’s insurance team, submitted on behalf of United Policyholders, to the California Supreme Court, which alerts the Court to the fundamental infirmities in the “standard” expounded by the insurance industry in COVID-19 business interruption litigations nationwide. The letter was issued to assist the Court in addressing a question certified from the US Court of Appeals for the Ninth Circuit, in Another Planet Entertainment, LLC v. Vigilant Insurance Co, asking whether the actual or potential presence of the COVID-19 virus on an insured’s premises “constitute direct physical loss or damage to property” for purposes of coverage under a commercial property insurance policy.
Continue Reading Hunton Insurance Team Alerts California Supreme Court to “Physical Alteration” Fallacy

Last week, the Ohio Supreme Court ruled in EMOI Services, L.L.C. v. Owners Ins. Co., 2022 WL 17905839 (Ohio, Dec. 27, 2022), that a policyholder did not suffer direct physical loss of or damage to computer media that was encrypted and rendered unusable. The Court reached its ruling even though “media” was defined in the policy to include “computer software,” concluding that software does not have a “physical existence.” The Supreme Court’s decision reverses an Ohio appellate court’s earlier ruling that the cyberattack triggered coverage under a commercial property insurance policy and builds upon plainly distinguishable rulings in COVID-19 business interruption cases, such as Santo’s Italian Café, L.L.C. v. Acuity Ins. Co., 15 F.4th 398, 402 (6th Cir. 2021), where the Sixth Circuit found that government orders issued in response to the COVID-19 pandemic did not physically alter insured property.
Continue Reading Ohio Supreme Court Launches COVID-19 Holdings into Cyberspace; Denies Coverage for Physical Loss or Damage to Computer Software

The Insurance Coverage Law Center has published an article in which Hunton insurance recovery partner, Michael Levine, exposes evidence of insurance company sins unearthed in the COVID-19 business interruption insurance litigation battleground.  The article discusses evidence obtained from four of the largest property and business income insurers, which tends to prove that long before COVID-19, each understood virus and communicable disease to pose a risk of physical loss or damage sufficient to trigger coverage under their respective all-risk insurance products.  A copy of the article is available here, with permission from the Insurance Coverage Law Center.
Continue Reading Michael Levine and Peers Expose Insurers’ COVID-19 Sins

One of the threshold issues in COVID-19 insurance coverage cases that have been brought across the country is whether the policyholder’s allegations meet the applicable pleading standard in alleging that the virus caused physical loss or damage. In many cases, the courts have gotten it wrong, effectively holding policyholders to a higher standard than required. But recently, a California federal judge righted those wrongs by acknowledging the correct pleading standard in that case, which is whether the allegations state a plausible claim for relief. Ashcroft v. Iqbal, 556 U.S. 662, 679 (2009). The Court, here, correctly recognized that the policyholder, the Los Angeles Lakers, met that pleading standard when it alleged that the COVID-19 virus can cause physical loss or damage by physically altering property.
Continue Reading California Court Forces Insurer to Play Ball in COVID-19 Insurance Coverage Suit

The Hunton insurance recovery team recently offered support in a matter of great importance to Maryland policyholders. The case is pending before the Maryland Court of Appeals on a question certified from a Maryland federal court in a COVID-19 business interruption insurance lawsuit brought by clothing manufacturer, Tapestry, Inc. Tapestry, the parent of luxury brands

As reported on this blog, policyholders have long been of the view that the presence of substances like COVID-19 and its causative virus  SARS-CoV-2, which render property dangerous or unfit for normal business operations, should be sufficient to trigger coverage under commercial all-risk insurance, as has been the case for more than 60 years.

However, many courts, federal courts in particular, despite decades of pro-policyholder precedent, have embraced the view that “viruses harm people, not [property].”  Thirty-one months after the start of the pandemic, the first state high court has gone in a different direction, according greater weight to pro-policyholder precedent.Continue Reading Vermont Supreme Court Finds COVID-19 May Damage Property