District Court Issues Rulings in Favor of Business Owners in COVID-19 Insurance Litigation


Stueve Siegel Hanson, Langdon & Emison, and Miller Schirger recently secured one of the first favorable rulings for business owners denied pandemic-related business interruption coverage by their insurers.

In June, the firms filed a lawsuit on behalf of K.C. Hopps, a locally owned Kansas City-based restaurant group against its insurer, The Cincinnati Insurance Company, for refusing to provide coverage for losses from COVID-19. Cincinnati responded by filing a motion to dismiss, arguing that K.C. Hopps was not entitled to coverage.

But on Wednesday, August 12, 2020, Judge Stephen R. Bough, United States District Judge for the Western of District of Missouri, denied Cincinnati’s motion. In his Order, Judge Bough concluded that allegations that COVID-19 had deprived K.C. Hopps of its property by making it unsafe and unsuitable for customers and others to use sufficiently stated a claim for coverage. Judge Bough’s Order (available here), along with another Order he filed the same day (available here), are the first rulings in the country in favor of insureds for COVID-19 related coverage.

Stueve Siegel Hanson, Langdon & Emison, Miller Schirger, and Shaffer Lombardo Shurin are currently representing business owners against insurance companies in business interruption litigation in multiple jurisdictions. In April they filed a class action lawsuit against Cincinnati Insurance on behalf of Promotional Headwear International, a wholesale distributor of custom-branded merchandise, alleging breach of contract stemming from its refusal to pay property insurance claims related to COVID-19.

The firms most recently announced two additional class action filings on behalf of three higher education institutions similarly denied coverage of claims filed under their insurance policies.

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