An Illinois court on Thursday refused to rule on an interruption in connection with COVID-19 filed by a building development and management company against a CNA Financial Corp. entity, stating that the plaintiffs had alleged evidence of physical loss or damage, which is covered by their policy.
New York-based construction management company JDS Construction Group LLC and Nyack, New York-based 9 Dekalb Fee Owner LLC, a construction developer developing an 80-story residential area in Brooklyn, filed a lawsuit against CNA unit Continental Casualty Co. in the State of Chicago, according to the judgment of JDS Construction Group LLC and 9 Dekalb Fee Owner LLC.
Both JDS and 9 DeKalb are insured under a builder risk policy that covers the period March 201
By refusing to dismiss the case, the court said that the plaintiffs claim that the virus has caused the direct physical loss or damage required for coverage under the insurance.
For example, the judgment stated that the complaint alleges "that the covid-19 droplets or nuclei were present on solid surfaces and in the air at the insured property and that the virus, a physical substance, has attached and adhered to the plaintiffs' properties."
In addition, the plaintiffs made detailed allegations about how the virus droplets are transported from infected people to solid surfaces in the property, to the air and (heating, ventilation and air conditioning), causing damage and changes to the property and the air from safe and breathable to unsafe and dangerous, which can survive on the surfaces for a longer significant period of time ", it is stated in the judgment.
The court also agreed with the plaintiffs that they sufficiently claimed that the direct physical loss triggered the insurance's civil law coverage.
The plaintiffs' lawyers could not be reached and the CNA did not respond to a request for comment.