Strip Club Owners Challenge Dismissal of COVID-19 Coverage Action in 9th Cir.

SAN FRANCISCO — The owners of 23 strip clubs and one “adult superstore” are urging the 9th Circuit U.S. Court of Appeals to reinstate their action seeking coverage of COVID-19-related business interruption losses, arguing they sustained “direct physical loss” of their covered properties.

In a June 7 brief, plaintiffs contend they are entitled to coverage from Beazley Underwriting Ltd. under the policy’s Time Element provision because government closure orders issued in response to the pandemic caused them to “lose possession” of their premises.

Plaintiffs say their interpretation is based upon the plain meaning of the policy language, giving each term …