Referring to previous decisions, a federal appeals court ruled Friday in favor of an Allianz SE unit in a covid-19 business interruption lawsuit filed by a Miami hotel owner.
Abbey Hotel Acquisition LLC, which owns and operates the Setai Hotel in Miami Beach, Florida, has filed a lawsuit against the National Surety Corp. and sought coverage for business interruptions under the commercial real estate risk insurance and increased coverage for business income losses it had purchased from insurers, according to the judgment of the 2nd U.S. Circuit Court of Appeals in New York in Abbey Hotel Acquisition, LLCD, Setai Hotel Acquisition, LLC, Setai Resort and Resident Condominium Association, Inc., Setai Valley Services, LLC. v. National Surety Corp.
To confirm a decision of the U.S. District Court in New York, a panel of three judges referred to similar rulings of a Florida Court of Appeals in Commodore, Inc., against Certain Underwriters at Lloyd̵
7;s, by the 11th U.S. Court of Appeals in Atlanta, SA Palm Beach LLC v. Certain Underwriters at Lloyd’s London and 2nd Circuits’ own judgment in 10012 Holdings Inc. DBA Guy Hepner v. Sentinel Insurance Co.The panel said it agrees with the New York District Court that “Abbey Hotel failed to claim the necessary” direct physical loss or damage “to trigger coverage under relevant policy provisions.” It also considered that the hotel was not entitled to coverage under the coverage’s provision for communicable diseases.
Allianz attorney Rob M. Hoffman, a partner with DLA Piper in Dallas, who is the lead advisor to most of the covid-19 disputes in the United States for Allianz and its subsidiaries, said: “The 2nd Circuit interpreted the key policy language correctly. in accordance with each appellate court that had dealt with the same issue throughout the United States and in accordance with Florida law, further confirming the correct interpretation of the National Surety Corporation’s coverage of communicable diseases.
The hotel’s lawyers did not respond to a request for comment.
On Wednesday, the 11th District issued its third verdict this week against a policyholder in a Covid-19-related lawsuit for business interruption filed by an eyeglass dealer against units in State Farm Insurance Co.
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