Salon Not Entitled to Coverage for COVID-19 Losses, Calif. Federal Judge Rules

LOS ANGELES — A California federal magistrate judge has dismissed without prejudice a COVID-19 business interruption coverage action filed by a European Wax Center, ruling that the policy’s virus exclusion applies to the alleged losses.

In a Sept. 22 order, Judge Jacqueline Scott Corley of the U.S. District Court for the Northern District of California noted that plaintiff Franklin EWC Inc. repeatedly alleged in its complaint that the virus caused and continues to cause the risk of direct physical loss required for a Covered Cause of Loss.

“Thus, as the loss was caused directly or indirectly by the virus, …