Soundview Cinemas in Port Washington have lost a lawsuit against their insurance company for economic losses it suffered from ceasing operations due to government mandates during the COVID-19 pandemic. (Photo by Rose Weldon)
A lawsuit by Soundview Cinemas in Port Washington against its insurance company for economic losses it suffered from ceasing operations due to government mandates during the COVID-19 pandemic has been dismissed.
On a motion dated Feb. 10, Justice Timothy S. Driscoll of the Commercial Division of the Supreme Court approved a motion to dismiss the suit against the defendants, who included Blue Point-based insurance brokers Five Star Coverage Corporation and Wilkinson & Krause Agency Inc. ;; as well as insurance companies including Ohio-based Great American Insurance Group, Great American Insurance Company of New York, and Jimcor, Inc.
Soundview, which had an insurance policy that covered direct physical loss or damage to property, had accused the defendants of breach of their insurance policy, negligence, improperly obtaining insurance and breach of fiduciary duty and stated that they did filed a claim on March 16, but the application was denied.
Driscoll noted in its decision that Soundview did not request the brokers or their insurance company for any specific coverage that would be in place for “these unprecedented times”. The judiciary also found that there was no evidence that such coverage of pandemic-related government shutdowns existed even before the onset of the pandemic.
“While the court agrees with the economic consequences of closing the plaintiff’s cinema, the court agrees with the majority view that the loss of the premises due to government regulations related to COVID-19 does not constitute direct physical loss or damage to the property that would trigger business income coverage under the policy, ”Driscoll wrote.
The ruling could set a precedent in future cases related to insurance payouts and the pandemic. Kevin Buckley, a partner at Mound Cotton Wollan & Greengrass, who represented Great American, hailed the ruling as “first of its kind” in a statement to the New York Law Journal, saying the ruling would provide guidance to lawyers in similar disputes.
“I think this is the first of many we’ll see from New York courts,” Buckley told the Journal. “So far no [New York] The state court made a decision that is known to us. Most of these guidelines borrow language from one another, so much of the language is fairly consistent across the industry. “
The theater was originally closed when New York State guidelines required it on March 16, 2020, and did not reopen on October 23 when the state approved the reopening of reduced capacity theaters. At the time, Desner told Blank Slate Media that Cuomo would have “done the same thing by keeping us closed” as no major films were released at the time.
Months after the theater first closed, the mall was bought by Sagamore Hill Partners of New York and PEBB Enterprises of Florida for an undisclosed amount in December. It is not yet known whether the cinema will be closed due to the purchase.
Comments are closed.