A federal district court in Los Angeles has refused to dismiss Covid-19-related lawsuits brought by ViacomCBS Inc. against a WR Berkley unit in litigation that focused on two disrupted productions.
Media and entertainment company ViacomCBS had sought cast coverage and additional expense coverage from Berkley unit Great Divide Insurance Co. in connection with losses it incurred on “Goldies Oldies,” a Nickelodeon International sitcom series filmed out of Manchester, England, and the “2020 Kid’s Choice” Awards,” a live awards ceremony produced in Los Angeles, both productions of which were canceled due to of the 2020 pandemic, according to Thursday’s ruling from the US District Court in Los Angeles i ViacomCBS Inc. v. Great Divide Insurance Co .
Great Divide has neither approved nor denied ViacomCBS̵7;s “Goldie’s Oldie’s” claim nor paid the “2020 KCA” claim, and it has denied that costs incurred prior to its abandonment fall within the policy’s additional cost coverage, the ruling said.
In September 2020, the insurer sent a notice of non-renewal to ViacomCBS.
ViacomCBS filed suit against the insurer, alleging breach of contract and the duty of good faith and fair dealing, and seeking declaratory relief with respect to coverage for its COVID-19-related claims for more than 100 productions. Great Divide filed a counterclaim against ViacomCBS regarding its coverage obligations and the validity of its non-renewal.
The ruling said the parties have settled more than 95 of the approximately 145 television production claims made under the policy, but they disagreed on some of the larger claims over what losses are covered and to what extent.
The court held that Great Divide must indemnify ViacomCBS under its due diligence clause for the costs of developing and implementing COVID-19 safety protocols for “Goldie’s Oldies.”
It said there is no dispute that ViacomCBS’s “efforts to develop and implement covid-19 safety protocols for the production of “Goldie Oldies“ were reasonably practicable efforts to avoid or reduce losses or circumstances likely to give rise to a loss or claim insured under the policy.”
Moreover, its “reliance on medical experts and government guidance to develop the protocols, as well as the implemented protocols themselves, was reasonably practicable as a matter of law for purposes of the due diligence clause,” the ruling said.
The court also ruled that ViacomCBS is entitled to a finding that Great Divide was not allowed to opt out of renewing the policy in 2020, and that its notice of non-renewal was invalid.
However, it held that ViacomCBS was not entitled to pre-production costs incurred before abandoning the “2020 KCA” production because it did not fall within the insurance’s “definition of loss” under the additional cost coverage provision.
Attorneys in the case did not respond to requests for comment.