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AIG wins covid-related BI verdict



The 9th U.S. Circuit Court of Appeals in San Francisco ruled in favor of an American International Group Inc. unit on Monday and upheld a lower court ruling that an event and venue management business is not entitled to covid19-related business interruption coverage, citing to the plaintiff’s virus exclusion.

The lawsuit was filed by Palmdale States Inc., which operates the Casa Bella Event Center in Sunol, California, against AIG Blackboard Insurance Co., according to court papers in Palmdale Estates Inc. v. Blackboard Insurance Co. The decision upheld a decision by the U.S. District Court in San Francisco.

A unanimous panel of three judges cited two previous judgments from the 9th Circuit of Mudpie Inc. v. Travelers Casualty Insurance Co. of America and

Plaintiffs in Mudpie “Before a similar argument ̵

1; the government’s order for suspension, the virus did not cause the loss,” the verdict said.

In the same way, in Chattanooga“The plaintiffs claimed that their losses were ‘due to other causes not involved in the virus, including … government response to the pandemic'”, the judgment said.

“Similarly, Palmdale cannot show that the government’s response to the virus was the product of anything other than the virus. The exclusion of the virus therefore precludes coverage,” the court said, confirming the lower court.

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

On April 21, the Massachusetts Judicial Supreme Court joined federal appellate courts in ruling on policyholders in a case of covid-19 business interruption, and became the first state Supreme Court to rule on the issue when it issued its decision in Verveine Corp. et. al v. Strathmore Insurance Co. et al.

The next day, it was joined by the Iowa Supreme Court, which issued two rulings. Jesse Embers LLC vs. Western Agricultural Insurance Co. and Wakonda Club v. Selective Insurance Co. of America, in judgments against policyholders in Covid 19-related disputes over business interruptions.

Jesse Embers runs a bar and restaurant in Des Moines, while Wakonda Club runs a private golf and country club in Des Moines.


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