Law360: Calif. Supreme Court Takes Up COVID-19 Coverage Appeal

The California Supreme Court granted a request by the Ninth Circuit to provide guidance on how COVID-19 business interruption cases should be interpreted. Another Planet Entertainment LLC sued Vigilant Insurance Co. for breach of contract after being denied coverage for income losses sustained during the pandemic, but the case was dismissed in February 2021 by a California federal judge. The judge’s decision found that there was no direct physical damage to Another Planet’s property as a result of the pandemic, and therefore does not prompt coverage under its policy. “If the allegation of the presence or potential presence of the COVID-19 virus is sufficient to show ‘direct physical loss or damage to property,’ the district court erred in dismissing Another Planet’s complaint for failure to state a claim,” the Ninth Circuit panel wrote. Vigilant Insurance Co. is represented by Jonathan D. Hacker and Jenya Godina of O’Melveny & Myers LLP.

Read the full article here.