SAN FRANCISCO (KGO) — This is the first victory of its kind against an insurance company which has refused to pay a covid claim in California. John’s Grill, one of San Francisco’s oldest restaurants, has settled its lawsuit against the Hartford Group. The payout is said to be in the millions.
In March 2020, John’s Grill was ordered by the city and county to close due to the spread of the coronavirus. 54 employees have been ordered to go home.
“It was one of the hardest days of my life. I had to look the family in the eye and tell them we were going to have to close for an undisclosed amount of time,” John Konstin of John’s Grill explained.
The restaurant quickly filed a claim with its insurance company, Hartford Financial Services Group. The insurance company was quick to respond.
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“They said, basically, we don’t have you covered under this COVID virus,” revealed Joe Cotchett, the attorney who represented the restaurant in its lawsuit against Hartford.
Insurance companies said the losses had to be related to “physical” damage to the restaurant, i.e. fire, vandalism. But in the lawsuit, the lawyers argued that the policy included business interruption coverage.
Who caused the interruption? The city and county of San Francisco, forcing all businesses to close. Now, remember the word “physics?” Because COVID is a highly contagious virus, it has created direct “physical” damage and unsafe conditions for property and people.
“It just wasn’t a virus flying through the air. Everything, every table, every chair, everything had to be cleaned, the dishes had to be redone, people had to be called in to clean the whole restaurant after someone left. one,” Cochett added. Hence the term “physical” damage.
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When this was taken to an appeals court, the judges demanded more legal arguments from both sides. That’s when Hartford decided it was time to settle with John’s Grill for an undisclosed amount.
Hartford did not return our calls for comment.
“I guess someone said we could end up here with a really bad decision that would affect us all over the state of California, so they were looking at huge, huge losses,” Cotchett said.
John’s Grill said the money obtained from the settlement will go to employees affected by the closure and the culinary program at City College San Francisco. The family has contributed a lot to the college over the years.
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