Public Health Workers Testing for COVID-19 (Irfan Khan/Los Angeles Times)
In In re: Erie COVID-19 Business Interruption Protection Ins. Litig., Master Docket No. 1:21-mc-1 & MDL No. 2969, 2022 WL 7933018 (W.D. Pa. Oct. 14, 2022), the Multi-District Litigation Court summarized the nature of the COVID-19 insurance claims that it had before it:
Plaintiffs in this multidistrict litigation all operate distinct businesses—from a retail clothing store in the Shadyside neighborhood of Pittsburgh, Pennsylvania, to a Ford/Lincoln car dealership in Cook County, Illinois, to a mussel bar in the Nation's Capital, and more. Different as their businesses may be, Plaintiffs’ legal claims are far less so—as compared to each other and to claims asserted by business owners in a multitude of similar cases nationwide.
In re: Erie COVID-19 Business Interruption Protection Insurance Litigation, 2022 WL 7933018, at *1.
The MDL Court granted Erie's motion to dismiss based on the gathering precedents that business interruption COVID-19 claims under any coverages in commercial property insurance policies like Erie's, which depend on "direct physical loss of or damage to" covered property, are simply not covered. This was certainly true from reading the Erie insurance policies at bar, the Court observed:
Under the Policies, a “covered cause of loss,” also called a “peril insured against,” is a “direct physical ‘loss,’ except ‘loss’ as excluded or limited in th[e] [P]olic[ies].”... In other words, a “covered cause of loss” must itself be of a physical nature, and the impact that it has on property—i.e., what it causes—must meet the definition of “direct physical loss of or damage to” covered property.
In re: Erie COVID-19 Business Interruption Protection Insurance Litigation, 2022 WL 7933018, at *11 (citation to the record of this particular case omitted).
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