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Law360 (July 23, 2020, 7:30 PM EDT) -- The latest in a tidal wave of lawsuits over pandemic-related insurance issues, a Philadelphia restaurant accused Seneca Insurance Co. in state court on Tuesday of refusing to provide promised coverage after the eatery was forced to shut down as a result of the COVID-19 outbreak.
Branzino Inc., which operates Branzino Italian Ristorante in the city's Rittenhouse Square neighborhood, said in a complaint that Seneca improperly denied its claim for business interruption coverage because there had been no physical loss or damage to the restaurant as a result of the pandemic.
But Branzino said in its complaint that Seneca's claim flew in the face of the ongoing disaster declaration in the state.
"[Seneca's] assertion that there has been no direct physical damage to insured property ... is plainly untrue since the pandemic has been declared to constitute a 'disaster emergency' which has affected all property in the Commonwealth of Pennsylvania," the restaurant said in its complaint.
According to Branzino, its policy with Seneca purports to provide as much as $150,000 in business interruption coverage.
The complaint said that the restaurant had purchased a policy enhancement providing coverage even in the case of business interruptions caused by virus or bacteria intrusion, which are typically excluded from coverage under typical commercial policies.
It added that the restaurant's policy included language specifically related to business interruptions related to the "action of civil authority that prohibits access" to the premises.
Despite that, Branzino said that a claim it submitted after a mid-March emergency order from Gov. Tom Wolf requiring all non-essential businesses to shut their doors had been improperly rebuffed by Seneca at the end of April.
A denial letter from the insurer said that the restaurant was not entitled to coverage because the policy required physical loss or damage to the property or, in the case of a business interruption due to a civil authority action, that the property be rendered inaccessible due to a dangerous physical condition.
But the existence of such a dangerous physical condition, Branzino said, was clearly laid out in the governor's orders declaring the pandemic a disaster emergency.
In addition to asking a judge to award damages under the insurance policy, Branzino is seeking punitive damages for what it says was Seneca's bad faith handling of its claim.
Representatives for the parties did not immediately return messages seeking comment on Thursday.
Branzino is represented by Jonathan Wheeler of Wheeler DiUlio & Barnabei PC.
Counsel information for Seneca was not immediately available.
The case is Branzino Inc. v. Seneca Insurance Co. Inc., case number 200701296, in the Court of Common Pleas of Philadelphia County, Pennsylvania.
--Editing by Adam LoBelia.
For a reprint of this article, please contact reprints@law360.com.
