Sullivan Mgmt v. Fireman's Fund
Annotate this CaseThe United States District Court for the District of South Carolina certified a question of law to the South Carolina Supreme Court. Sullivan Management, LLC operated restaurants in South Carolina and filed suit to recover for business interruption losses during COVID-19 under a commercial property insurance policy issued by Fireman's Fund and Allianz Global Risks US Insurance Company (Fireman's). Specifically, the questions was whether the presence of COVID-19 in or near Sullivan's properties, and/or related governmental orders, which allegedly hinder or destroy the fitness, habitability or functionality of property, constituted "direct physical loss or damage" or did "direct physical loss or damage" require some permanent dispossession of the property or physical alteration to the property. The Supreme Court held that the presence of COVID-19 and the corresponding government orders prohibiting indoor dining did not fall within the policy’s trigger language of “direct physical loss or damage.”
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