Calif. Hotel Owner Loses Federal Court Battle for COVID-19 Coverage

CHICAGO — The owner of a California hotel cannot recoup COVID-19-related business interruption losses from American Zurich Insurance Co. because there was no “direct physical loss of or damage to” property, a federal judge has ruled.

In an Oct. 29 order, Judge Charles P. Kocoras of the U.S. District Court for the Northern District of Illinois further ruled that even if such damage occurred, Park Place Master Tenant LLC’s losses fall under the policy’s virus exclusion.

Park Place owns the Hotel Constance Pasadena in Pasadena, Calif. On March 4, 2020, California Governor Gavin Newsom declared a state of emergency because …