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Northern District of New York grants summary judgment to insurer on casino COVID-19 claims



The Northern District of New York recently granted the insurer Affiliated Factory Mutual Insurance Company & # 39 ;s Motion for Summary Judgment against Mohawk Gaming Enterprises. Mohawk – a casino and facility operated by the Saint Regis Mohawk Tribe located on the border between New York and Canada – sued its insurance company Affiliated Factory Mutual and is trying to recover from business losses due to the COVID-19 pandemic.

Mohawk closed its casino to the public after an outbreak of COVID-19 was discovered at a college 50 miles away. It then filed a claim with Affiliated Factory Mutual, which sought to recover the business loss losses incurred by COVID-1

9. [that] prohibits access to a place "if that order" is a direct result of physical damage of the insured type "at or within 50 km of a covered place. Mohawk claimed that COVID-19 caused "physical loss or damage" of the type insured by the insurance company. Because COVID-19 was located within 50 miles of the casino, Mohawk claimed, business break coverage was applied. Affiliated Factory Mutual denied the claim and Mohawk sued.

In the end, the district court gave a summary judgment to Affiliated Factory Mutual. The court found that the meaning of "physical injury" unequivocally does not cover "only the presence or spread of the new coronavirus". As the Court held that the language of the policy was unequivocal, it refused to consider any external evidence of the policy and instead held that COVID-19 did not physically damage property. And because the policy did not cover losses related to COVID-19, the district court dismissed Mohawk's complaint.

It is unclear whether the policyholder will appeal the decision. The Court's decision in Mohawk contradicts several other decisions, including the most recent decision in Cinemark Holdings, Inc. v Factory Mutual Insurance Co. No. 4: 21-cv-00011 (ED Tex. 5 May 2021). In Cinemark the district court ruled that the actual presence of COVID-19 could cause harm and was therefore sufficient to trigger coverage under an almost identical policy. Trials continue in state and federal courts at both trial and appeal levels on COVID-19 claims.


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