French Quarter Restaurant Files Suit in What May Be First Pandemic Insurance Dispuit
Mar 19 2020

French Quarter Restaurant Sues in What May Be First U.S. Pandemic Insurance Dispute

By: Raissi Bysiewicz

A French Quarter restaurant is suing Lloyd's of London. Their hope is that the U.K. based insurance market will compensate them for losses spurred by government-mandated closures due to the pandemic. On Monday, Oceana Grill filed suit in Orleans Parish District Court. The restaurant's attorney, John Houghtaling, fought against insurance companies during Hurricane Sandy as well as founded the nonprofit American Policyholder Association. According to Houghtaling, Lloyd's policy clearly applies as the coronavirus constitutes a damage to Oceana Grill's property that requires closure. However, Zelle LLP, the Dallas-based firm defending many of Lloyd's syndicates, disagrees. The firm holds that the insurance agency is not responsible for providing business interruption coverage simply because the government has required shutdowns as a precaution. Nonetheless, Houghtaling maintains that Oceana Grill has suffered property damage from COVID-19 since the virus contaminates surfaces. His argument appears to be supported by New Orleans Mayor LaToya Cantrell, who issued an emergency declaration that same day, ordering restaurants to restrict their operations to delivery service and take-out. The Mayor's declaration explicitly states that the coronavirus "causes property loss and damage in certain circumstances."

Cantrell announced at a press conference on Monday afternoon that she would continue addressing the business interruption insurance issue. She stated that, considering pandemic infections are not included in many agencies' coverage options, her administration is prioritizing the problem at the state and federal level.

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