Insurer Slams Bid To Consolidate Pa. Virus Coverage Suits

By Matt Fair
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Law360 (July 20, 2020, 5:17 PM EDT) -- Erie Insurance Exchange urged a Pennsylvania state judge Friday to reject a bid by a Pittsburgh restaurateur to consolidate a wave of pending lawsuits against the insurer seeking coverage for financial losses sustained as a result of the coronavirus pandemic.

Erie said in its brief that consolidation made little sense given that litigating pandemic-related coverage disputes would involve close examination of individual businesses and the scope of each of their respective insurance policies.

"There is simply no 'one size fits all' approach that can fairly and efficiently address these matters," Erie said. "To the contrary, each complaint requires individualized consideration of its unique facts under the relevant insurance policy. Given the wide range of factual circumstances each plaintiff faces, coordination makes little sense."

The consolidation push comes as part of a lawsuit from the owner of the Pittsburgh-based Joseph Tambellini Restaurant aimed at forcing Erie to cover losses it suffered after it was forced to close its doors as a result of state and local government orders issued in response to the COVID-19 outbreak.

Tambellini had previously asked the Pennsylvania Supreme Court to exercise its so-called King's Bench authority to take jurisdiction over the case in order to answer what the restaurant said were broad questions about whether business closures merited coverage despite the lack of any physical property damage.

The state high court ultimately denied Tambellini's petition in mid-May.

According to court records, Tambellini filed a motion with an Allegheny County judge last month requesting coordination of all pending actions across the state regarding Erie's pandemic-related coverage obligations.

In Erie's response brief Friday, the insurer identified just over a dozen cases Erie is facing in different county court systems across Pennsylvania.

The insurer said that the coordination bid was supported by "vague references to conservation of judicial resources and unsupported allegations concerning the convenience of witnesses and parties," but that, on the whole, each case would require too much individualized analysis for the litigation to move forward in a coordinated fashion.

"In light of the unique and distinct factual underpinnings of the various suits against Erie, there is simply no predominating issue of fact or law sufficient to justify coordination," the insurer said. "In this regard, the risk of inconsistent rulings is limited, as each specific case must be limited to its own facts."

It also rebutted Tambellini's contention that coordination in Allegheny County would make it easier on litigants and witnesses.

"Litigating these matters in Allegheny County does nothing for the convenience of any witness located in eastern Pennsylvania," Erie said. "Travel for these witnesses will be both inconvenient and expensive."

Scott Cooper, an attorney with Schmidt Kramer PC representing Tambellini, cast Erie's effort to deny coordination of the litigation as a delay tactic.

"This is nothing more than the insurance company continuing to try and deny these businesses coverage that they paid for and deserve," he told Law360. "Erie does not want to allow a state court judge to decide an issue of state law involving state businesses. We want to have all the cases coordinated so that there is a way to streamline the cases to the Pennsylvania Supreme Court."

An attorney for Erie did not immediately return a message seeking comment.

Erie is represented by Richard DiBella and Tara Maczuzak of DiBella Geer McAllister Best PC, and Robert Horst, Robbery Runyon III and Matthew Malamud of Timoney Knox LLP.

Tambellini is represented by James Haggerty of Haggerty Goldberg Schleifer & Kupersmith PC, Scott Cooper of Schmidt Kramer PC, John Goodrich of Jack Goodrich & Associates PC, Michael Boni, Joshua Snyder and John Sindoni of Boni Zach & Snyder LLC and Jonathan Shub of Shub Law Firm LLC.

The case is Joseph Tambellini Inc. v. Erie Insurance Exchange, case number GD-20-005137, in the Court of Common Pleas of Allegheny County, Pennsylvania.

--Editing by Jack Karp.

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