A federal district court has ruled that the Los Angeles Lakers can continue with COVID-19-related damages and bad faith claims against a Chubb Ltd. unit, even though it reiterated its previous decision that rejected the NBA team’s claim for business interruption.
In August, the U.S. District Court of Los Angeles dismissed the Lakers ‘Covid-19 related lawsuit over business interruptions against the Chubb unit Federal Insurance Co., alleging that the virus’ presence at the Staples Center and surrounding transportation stations physically altered the property. The court called these “mere legal conclusions as allegations of fact” and said the team had not been able to support its conclusion that the presence of the virus constituted “direct physical loss or damage.”;
The team had greater success with a first amended complaint, which was filed in court in October, claiming that the same had previously rejected claims but with additional factual allegations.
The Lakers claimed that the virus caused physical changes in covered properties when it “landed on and adhered to surfaces such as cloth seats, elevator buttons and air ducts, causing a physical and chemical reaction that transformed the surfaces into vectors of virus spread called fomites,” the court said on March 17. reported by Sportico.com.
The ruling said that as a result, the team upgraded its features to include “new air filters; non-contact light switches, toilets and sinks; sleeves or coatings for high-touch surfaces; and plexiglass dividers”, claiming that the features were not useful until these upgrades were completed.
“The Lakers claimed that both the covered properties were physically altered and that these changes caused harmful financial consequences. Consequently, the Lakers presented a claim for a declaratory judgment and breach of contract regarding the insurance clause on property damage,” the court said when allowing the trial to continue.
The court also ruled that the Lakers can continue with their bad faith claim with respect to the property damage. The team said the Federal sent a request letter form “instead of carefully examining the bid submitted,” according to the ruling.
The court again ruled the law’s claim for business interruption, and held that it was not caused by physical injury or loss.
Lawyers in the case did not respond to a request for comment.