Publications

(Article from Insurance Law Alert, April 2022)

For more information, please visit the Insurance Law Alert Resource Center.

The Fourth Circuit affirmed a Maryland district court order dismissing a suit seeking business interruption coverage for income losses incurred in the wake of government shutdown orders. The Cordish Companies, Inc. v. Affiliated FM Ins. Co., 2022 WL 114373 (4^th Cir. Apr. 14, 2022). The district court concluded that allegations of infected individuals or of viral presence near or at insured property did not constitute direct physical loss or damage to property, explaining that “[t]he term ‘physical,’ as used in the Policy, ‘clearly indicates that the damage must affect the good itself, rather than the Plaintiff's use of that good.’” The Cordish Companies, Inc. v. Affiliated FM Ins. Co., 2021 WL 5448740 (D. Md. Nov. 22, 2021) (citations omitted). The district court also ruled that the lack of physical damage to property was fatal to the claim for civil authority coverage. Finally, the court ruled that coverage would be barred in any event by a contamination exclusion. Finding no reversible error in the district court’s holdings, the Fourth Circuit summarily affirmed.