Appellate court rules against restaurant in COVID case
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The 2nd U.S. Circuit Court of Appeals in New York on Thursday ruled against an Italian restaurant in a COVID-19 business interruption case.
“We conclude that the plain text” of the policy’s provisions “makes clear that either direct physical loss or property damage is a necessary predicate to coverage,” the appeals court said in its ruling in BR Restaurant Corp., DBA Bruno’s Restaurante Italiano v. Nationwide Mutual Insurance Co., which was filed by a Howard Beach, New York, restaurant. The ruling affirmed a decision by the U.S. District Court in Central Islip, New York.
The decision by the three-judge appeals court panel referred to the court’s December ruling in 10012 Holdings Inc. DBA Guy Hepner v. Sentinel Insurance Co., which also held in the insurer’s favor. That case was filed by a New York art gallery against a Hartford Financial Services Group Inc. unit.
Thursday’s ruling said “no subsequent developments in New York courts have called that decision into question. We are therefore bound by our prior decision in 10012 Holdings.”
Plaintiffs attorney Michael S. Cole, of Cole Chester LLP in New York, said in a statement, “New York law gives weight to extended coverage, does not hold consistent with the one-size-fits-all federal case law rule. Though the Second Circuit holds that New York law is consistent — this is done without looking very close — just stating it as a given.”
Nationwide’s attorneys did not respond to a request for comment.
