Current:Home > StocksNew Jersey Supreme Court rules against Ocean casino in COVID business interruption case -CapitalEdge
New Jersey Supreme Court rules against Ocean casino in COVID business interruption case
View
Date:2025-04-18 18:57:59
ATLANTIC CITY, N.J. (AP) — New Jersey’s Supreme Court ruled Wednesday that an Atlantic City casino is not entitled to payouts from business interruption insurance for losses during the COVID-19 outbreak, determining that the presence of the virus did not constitute the kind of “direct physical loss or damage” required for such a payout.
The case involved the Ocean Casino Resort’s claims against three insurance companies — AIG Specialty Insurance Co., American Guarantee & Liability Insurance Co. and Interstate Fire & Casualty Co. Those insurers largely denied payouts to the casino, saying it did not suffer direct physical loss or damage because of the virus.
The casino sued and defeated an attempt by the insurers to dismiss the case. But that decision was reversed by an appellate court.
The high court agreed to take the case in order to resolve the legal question of what constituted loss or damage.
“Based on the plain terms of the policies, we conclude that in order to show a ‘direct physical loss’ of its property or ‘direct physical . . . damage’ to its property under the policy language at issue, (parent company AC Ocean Walk LLC) was required to demonstrate that its property was destroyed or altered in a manner that rendered it unusable or uninhabitable,” the court wrote in a unanimous decision.
“At most, it has alleged that it sustained a loss of business during the COVID-19 government-mandated suspension of business operations because it was not permitted to use its property as it would otherwise have done,” the opinion read.
It concluded that the casino’s pleadings “do not support a finding that it is entitled to insurance coverage.”
The casino declined comment Wednesday.
The ruling is similar to others reached in state and federal courts around the country, including cases where payouts were denied involving a chain of California movie theaters; a Los Angeles real estate firm; a group of hotels in Pennsylvania; and a group of hotels and a law firm in New Jersey.
During arguments in September before the Supreme Court, Stephen Orlofsky, a lawyer for Ocean, said the casino took several steps to respond to the virus, including employing air filtration systems and using “industrial-strength” cleaning supplies.
But David Roth, a lawyer for American Guarantee, said the policies require there to be physical damage to the property, which he said did not occur at the casino. He said 14 state Supreme Courts around the nation have held that the mere interruption of business activity during the pandemic does not constitute physical losses.
Ocean maintained that in addition to an order by Democratic Gov. Phil Murphy closing the casinos for 3 1/2 months in 2020, it also shut down because of “the concern that the virus was having on the physical surfaces and the air” inside the casino.
___
Follow Wayne Parry on X, formerly Twitter, at www.twitter.com/WayneParryAC
veryGood! (113)
Related
- 'Survivor' 47 finale, part one recap: 2 players were sent home. Who's left in the game?
- Arsenic, lead and other toxic metals detected in tampons, study finds
- Netherlands into Euro 2024 semifinal against England after beating Turkey
- Hatch Baby recalls over 919,000 power adapters sold with sound machine due to shock hazard
- Man can't find second winning lottery ticket, sues over $394 million jackpot, lawsuit says
- Eddie Murphy on reviving Axel Foley, fatherhood and what a return to the stage might look like
- Vatican excommunicates ex-ambassador to U.S., Archbishop Carlo Maria Viganò, declares him guilty of schism
- WWE Money in the Bank 2024 results: Winners, highlights, analysis
- Why Sean "Diddy" Combs Is Being Given a Laptop in Jail Amid Witness Intimidation Fears
- Caitlin Clark notches WNBA's first ever rookie triple-double as Fever beat Liberty
Ranking
- Which apps offer encrypted messaging? How to switch and what to know after feds’ warning
- Wimbledon 2024 bracket: Latest scores, results for tournament
- Morgan Wallen should be forgiven for racial slur controversy, Darius Rucker says
- Scorching hot Death Valley temperatures could flirt with history this weekend: See latest forecast
- The Grammy nominee you need to hear: Esperanza Spalding
- Warriors' Steve Kerr thanks Klay Thompson for '13 incredible years'
- Vying for West Virginia Governor, an ‘All of the Above’ Democrat Faces Long Odds Against a Republican Fossil Fuel Booster
- RHONY's Luann de Lesseps and Bethenny Frankel Reunite After Feuding
Recommendation
Questlove charts 50 years of SNL musical hits (and misses)
‘Not Caused by an Act of God’: In a Rare Court Action, an Oregon County Seeks to Hold Fossil Fuel Companies Accountable for Extreme Temperatures
Russia sentences U.S. man Robert Woodland to prison on drug charges
Yankees rookie Ben Rice enters franchise history with three homers against the Red Sox
South Korean president's party divided over defiant martial law speech
Honeymoon now a 'prison nightmare,' after Hurricane Beryl strands couple in Jamaica
Alec Baldwin is about to go on trial in the death of a cinematographer. Here are key things to know
Wimbledon 2024 bracket: Latest scores, results for tournament