Federal Court in New York Court Dismisses Civil Authority Claim for COVID-19 Coverage

Hand raised in stop

A recent decision on the issue from the federal Southern District of New York sheds light on New York law regarding this pressing issue.

October 11, 2021
Eric D. Suben - Traub Lieberman

Courts nationwide have been grappling with coverage for business interruption claims arising from closures occasioned by the COVID-19 pandemic, with mixed results by jurisdiction. A recent decision on the issue from the federal Southern District of New York sheds light on New York law regarding this pressing issue.

In Elite Union Installations, LLC v. National Fire Insurance Company of Pittsburgh, PA, 2021 WL 4155016 (Sept. 13, 2021), directives issued by governmental authorities required the insured construction company to shut its doors, leading to a layoff of some employees while others continued to work from home. The insured made a claim under its commercial property coverage for damage to its premises, which it claimed were rendered “uninhabitable” and required repair in the form of alterations to comply with social distancing requirements. In the ensuing coverage litigation, National Union moved to dismiss the complaint alleging covered first-party property damage defined in the policy as “direct physical loss of or damage to property.”

Mr. Suben may be contacted at esuben@tlsslaw.com



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