Calif. Restaurant, Bakery Owners Lose Bid for COVID-19 Coverage



DOCUMENTS
  • Order


SAN DIEGO — Affiliated FM Insurance Co. has prevailed in a COVID-19 coverage action filed by two affiliated restaurant and bakery chain owners, ruling that they did not sustain “direct physical loss or damage” to their properties, as required by the policy.

In an April 2 order, Judge Marilyn L. Huff of the U.S. District Court for the Southern District of California noted that California courts have consistently interpreted the phrase to require a “distinct, demonstrable, physical alteration” to property.

Islands Restaurants, LP owns and operates 50 tropical-themed restaurants in California, Arizona, and Hawaii. In 2015, Islands partnered with CFBC …






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