Georgia’s First COVID-19 Business Interruption Loss Insurance Case Results in Carrier Victory

In Henry’s Louisiana Grill v. Allied Ins. Co. of America (Civil Action No. 1:20-CV-2939-TWT), decided October 6, 2020, Georgia’s Northern District Court (Atlanta Division) granted the insurer’s motion to dismiss the business interruption insurance coverage claim of the restaurant and denied its motion seeking to have the Georgia Supreme Court weigh-in on an certified question of law. Like many other courts around the country, the federal court held that the eatery did not experience a “direct physical loss of or damage to property” because of the Georgia Governor’s March 14, 2020 COVID-19 related Public Health State of Emergency executive order, which did not impose any physical change on the covered premises. Also, the court did not find the policy’s language ambiguous.  Likewise, the civil authority coverage under the insurance policy at issue was not triggered because the executive order did not prohibit patrons from accessing the restaurant and was at most a stay-at-home advisory order, recognizing an already present public health threat. As a result, the court declined to exercise its discretion to certify the question of what is the meaning of “direct physical loss of or damage to property”, rejecting the plaintiff insured’s argument that there is a “substantial doubt regarding the status of state law” on the issue, which is requirement for certifications of questions of law to the state’s supreme court.