Atlantic City Ocean Casino Resort Loses COVID Insurance Relief Suit

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Posted on: January 25, 2024, 11:15h. 

Last updated on: January 27, 2024, 11:18h.

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Ocean Casino Resort successful Atlantic City won’t person $50 cardinal successful spot security coverage. The property’s genitor institution claimed it was owed for damages suffered during nan COVID-19 pandemic.

Ocean Casino Resort Atlantic City COVID-19 lawsuitAn worker astatine Ocean Casino Resort successful Atlantic City hangs a motion connected nan casino level amid nan COVID-19 pandemic connected June 2, 2020. Ocean Casino this week mislaid its suit seeking spot harm sum from its insurers for pandemic business losses. (Image: AP)

The New Jersey Supreme Court this week ruled that 3 spot insurers aren’t liable for paying Ocean Casino for operational losses it incurred during nan coronavirus emergency. Ocean Casino is controlled by an entity called AC Ocean Walk, LLC. The LLC is afloat owned by Luxor Capital Group and Ilitch Holdings.

The crux of nan lawsuit was determining if Ocean Casino suffered “direct beingness loss” aliases “direct beingness damage” to its spot from nan microorganism infiltrating nan Boardwalk property. In a unanimous ruling, nan New Jersey Supreme Court ruled it did not.

No Physical Damage

New Jersey Supreme Court Justice Anne Patterson said Ocean Casino Resort attorneys grounded to pinpoint really nan beingness of a microorganism led to beingness damage.

“Ocean Walk was required to show that its spot was destroyed aliases altered successful a mode that rendered it unusable aliases uninhabitable,” Patterson wrote for a unanimous court.

Patterson explained that Ocean attorneys claimed nan nonstop beingness harm to nan spot was nan “actual and/or threatened beingness of coronavirus particles.” The judge said those claims “do not support a uncovering of a ‘direct beingness loss.'”

It alleges that, successful compliance pinch governmental directives, it was forced to adjacent to nan nationalist successful March 2020 and that it reopened successful July 2020 pinch restricted aliases constricted operations,” Patterson continued. “Here, absent nan executive orders, Ocean Walk would person been capable to usage its spot for casino and different intermezo functions pinch nary suspension of its operations.”

AIG Specialty Insurance, American Guarantee & Liability Insurance, and Interstate Fire & Casualty sought to person nan Ocean Casino property sum suit dismissed connected claims nan policies included contamination exclusions. A little authorities tribunal and Patterson agreed that nan contamination removal didn’t use because nan information chiefly deals pinch radioactive contamination, not contamination from a “virus,” “pathogen,” aliases “pathogenic organism.”

Patterson said nan contamination from a microorganism didn’t consequence successful beingness damage, and therefore, didn’t warrant spot security coverage.

“The spot security policies issued by defendants group distant identical guidelines argumentation forms. Each argumentation provided that it insured ‘against nonstop beingness nonaccomplishment of aliases harm caused by a Covered Cause of Loss to Covered Property, astatine an Insured Location.’ Each argumentation contained a ‘contamination exclusion’ providing successful portion that — ‘unless it results from nonstop beingness nonaccomplishment aliases harm not excluded by this Policy’ — ‘Contamination, and immoderate costs owed to Contamination including nan inability to usage aliases inhabit nan spot aliases immoderate costs of making nan spot safe aliases suitable for usage aliases occupancy’ is excluded,” Patterson concluded.

Insurers Not Responsible for COVID Losses

The New Jersey Supreme Court determination is nan latest triumph for insurers, which person mostly won COVID-19 spot harm cases.

Penn Law’s “Covid Coverage Litigation Tracker” shows that among nan much than 1,000 cases revenge against security companies for not paying retired connected business interruption policies caused by COVID-19, little than 2 twelve person gone successful nan plaintiff’s favor.

AIG, American Guarantee, and Interstate Fire did salary Ocean $850K for claims connected abstracted spot coverages for “Interruption by Communicable Disease.”

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