A federal judge has dismissed a lawsuit filed by the company behind the Apple+ series. morning show as they sought to recover tens of millions of dollars in damages from production shutdowns due to Covid.
This is the latest legal loss for manufacturers and companies in general trying to recover damages from insurers due to the pandemic.
Last year, Always Smiling Productions sued Chubb National Insurance Co., alleging that the insurance company accepted “arbitrary limits” on the show’s coverage and interpreted the show’s policies in a way that would limit its liability. The producers said they suffered a $44 million loss due to the Covid-19 closure and the postponement of the second season.
United States District Judge Fernando M. Holguin wrote that he was “unconvinced” by Always Smiling Productions’ claim that an insurance clause covering “physical damage or damage” covered losses incurred as a result of the shutdown. The judge cited the decision against CAA and UTA, in which the courts concluded that the impact of the virus on physical property had no consequences.
The judge also rejected that another provision of the policy regarding preventing entry and exit to a location due to physical loss or damage would also apply to Covid losses.
“In short, since Plaintiff did not allege any physical loss or damage to property, no benefits were due under the imminent danger and entry and exit provisions of the Policy,” the judge wrote.
The production company also argued that the production would be subject to damages due to civil or military action. The judge noted that the insured company would have to show that the civil authorities had withdrawn permission to use the property or facility.
The judge also dismissed claims that the cast coverage provision applicable to damages due to death, injury or illness applies to production costs to prevent the spread of Covid.
According to the lawsuit, the show had $125 million in cast coverage and $1 million for each type of imminent danger, living or military authority, and entry and exit.
After the Covid-19 pandemic caused massive shutdowns and closures, Chubb was notified by manufacturers to stop production on March 12, 2020. However, a few weeks later, the insurance company claimed that the losses were only covered by the civil authorities or the military. $1 million liability limit per incident.
Then, in September, Chubb sent a letter “essentially denying coverage for most aspects of the loss of Always Smiling,” according to the lawsuit.
A lawyer for the production company did not immediately respond to a request for comment.