Thomas Keller, the famed chef behind restaurants including The French Laundry and Per Se, is seeking a court judgment to confirm his insurance company should cover coronavirus-related business losses.
Keller’s attorney says the suit against insurer Hartford Fire Insurance Company – and other similar challenges filed by restaurant owners – is intended to establish legal precedent so that businesses facing mandated coronavirus closures are covered by their business interruption insurance policies.
Matthew Sturdevant, a spokesperson for The Hartford, declined to comment on the lawsuit. The suit was brought by French Laundry Partners, LP and Keller’s restaurant group.
The lawsuit was first reported by Restaurant Hospitality.
Keller is one of America’s most-decorated chefs, and his restaurants have received numerous awards and accolades. He’s the first American-born chef with two restaurants simultaneously achieving three-star ratings from the Michelin Guide.
Keller’s group has about a dozen restaurants in New York, Las Vegas, Miami and Yountville, Calif.
His is not the only challenge by a restaurant regarding coronavirus-related insurance coverage. New Orleans seafood restaurant Oceana Grill made a similar move earlier this month in asking a Louisiana court to make a declaratory judgment that its insurance policy with Lloyd’s of London covers civil authority-ordered closures.
The American Property Casualty Insurance Association this week said it believes that most insurance policies – including those with business interruption coverage – do not cover viruses such as Covid-19 and that to “retroactively rewrite existing insurance policies” could put the insurance industry at risk.
One estimate by the association found that small business’ potential continuity losses could total $220 billion to $383 billion per month, which would quickly consume the estimated $800 billion surplus US insurers have for payouts.
“If policymakers force insurers to pay for losses that are not covered under existing insurance policies, the stability of the sector could be impacted and that could affect the ability of consumers to address everyday risks that are covered by the property casualty industry,” David A. Sampson, president and CEO of the association, said in a statement.
John Houghtaling, the attorney representing both Keller and Oceana Grill, told CNN Business that “It’s become clear the insurance companies were not going to honor these policies.”
Houghtaling, managing partner of Gauthier, Houghtaling LLP, referenced a posting made earlier this month by a catastrophe litigation attorney with Zelle LLP, a boutique law firm that focuses on insurance-related matters. The attorney wrote that unless policies specifically outline non-physical damage coverage, businesses “are unlikely to find relief within the four corners of their policies.”
Houghtaling disagreed with the assessment.
“They’re wrongfully denying us, which is going to cripple millions of people and their livelihoods,” he said.