Earlier this week, iconic Berkeley restaurant Chez Panisse filed suit against its insurance company for denying a vital interruption-of-business claim. Founder and owner Alice Waters says she wouldn't be going to court unless this were a serious matter, and like much of her locavore activism she's hoping this case has an impact for restaurants across the country during this pandemic.
"I don’t sue people easily," Waters tells KPIX today. "I don’t believe in it." But with vendors and staff going without getting paid, she says the insurance money "would make all the difference between [reopening] easily or with great difficulty."
And, out of principal, she believes the company was wrong to deny the claim, saying that the virus pandemic isn't covered as an interruption of business.
As the Mercury News reported earlier this week, the Chez Panisse lawsuit is already one of a growing number, including one by Thomas Keller's restaurant group, arguing that the business interruption insurance premiums they've been paying for years are for situations exactly like this one.
Chez Panisse's attorneys say that the restaurant's insurer, AMCO, is using "overly broad exclusions" to deny this claim.
"These businesses were responsible and paid substantial premiums for insurance and in our view this is a covered loss,” says Andre Mura, a partner at Gibbs Law Group, which is one of two firms representing Chez Panisse, speaking to the Mercury News. "The COVID-19 closures are having a profound impact on the restaurant industry and now it’s having a substantial impact on a broader group of people within the supply chain. It’s a pretty substantial social issue."
"The American people are being grossly deceived by their insurance companies," says Scott Friedson, CEO of Insurance Claim Recovery Support, speaking to KPIX. "They need to be holding the interest of policy holders equal to their own. And wherever there’s some ambiguity, they need to do the right thing and indemnify their policy holders."
Friedson suggests that depending on how lower courts rule on this matter, the issues surrounding this type of insurance and denial of claims during a global crisis could very well get taken to the Supreme Court.