Cincinnati wins COVID-related ruling against recreational park

A federal appeals court on Friday ruled against a recreational park in COVID-19-related business interruption litigation filed against Cincinnati Insurance Co.

Renaissance, which owns and operates the Fun Park, a Louisville, Kentucky, recreational facility that includes go-karts, laser tag, miniature golf and arcade games, closed its park for three months to comply with Kentucky’s 2020 closure order, according to the ruling by the 6th U.S. Circuit Court of Appeals in Cincinnati in Renaissance/The Park v. Cincinnati Insurance Co.

It filed suit against Cincinnati when it denied coverage. The U.S. District Court in Louisville ruled in the insurers’ favor, and was affirmed by a three-judge appeals court panel.

Citing its earlier ruling in Estes v. Cincinnati Insurance Co., the appeals panel said, “To be sure, the closure order did prevent Renaissance from opening the Park to customers, a prohibition that lamentably resulted in lost use of the Park. But that manner of loss is not tantamount to a ‘direct’ ‘physical loss,’” it said.

The ruling said also that “Renaissance appears to have a second theory of coverage,” which is that “when customers visited the Fun Park before the closure order, some of them presumably brought COVID-19 into the Park, thereby, in the words of Renaissance, ‘contaminating’ the Park, and thus causing it ‘direct’ ‘physical damage.’

“That theory of recovery, however, leaves much to the reader’s imagination,” the ruling said, in affirming the lower court.

Attorneys in the case did not respond to requests for comment.