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Novel Coronavirus Breeds Novel Litigation: Business Interruption Suits in the Age of COVID-19

Published on: April 17, 2020

The nation’s first suit seeking a declaration of coverage under a commercial property policy for business interruption and extra expenses incurred as a result of COVID-19 was filed in a Louisiana state court on March 20, 2020. Since then, similar suits have been filed across the nation by restaurants, casinos, dentists, dive shops, movie theatres, repertory theatre companies, etc. Clearly, the same coverage issues raised in the Louisiana case will be litigated throughout the nation.

The suit in Cajun Conti, LLC, et al v. Certain Underwriters at Lloyd’s, London, et al, Suit No. 2020-02558, was filed on March 16, 2020, in the Civil District Court for the Parish of Orleans, State of Louisiana. Plaintiffs, doing business as Oceana Grill, a restaurant in the French Quarter, allege coverage should be declared to exist because: 1) the property policy is an “all risks” policy such that all risks are covered unless the insurer can clearly and specifically establish an exclusion from coverage; 2) the policy does not contain any exclusion “for losses from a virus or global pandemic;” 3) the virus has “physically impact[ed] public and private property” as it “physically infects and stays on the surface of objects or materials, ‘fomites,’ for up to twenty-eight days;” 4) such “contamination … [is] a direct physical loss needing remediation;” and, alternatively and in addition, 5) the current and future state orders limiting its operations serve to trigger the civil authority provisions of its policy.

A key issue in Cajun Conti as well as in the other COVID-19 business interruption coverage litigation will be whether the existence of the novel coronavirus constitutes a “direct physical loss or damage” under the intendment of an all risks property policy. The Cajun Conti plaintiffs cite to Widder v. Louisiana Citizens Prop. Ins. Corp., 2011-0196 (La. App. 4 Cir. 8/10/11), 82 So.3d 294, writ denied, 2011-2336 (La. 12/2/11) for the premise that the existence of a hazardous condition that renders the insured property unusable or uninhabitable is sufficient to constitute a “physical loss or damage” sufficient to trigger coverage. Notably, in Widder, the actual presence of inorganic lead in the insured property was confirmed to exist and coverage was therefore available. Because policyholders have the burden to establish the existence of “physical loss or damage,” reliance on Widder may require the Cajun Conti plaintiffs to establish coronavirus was actually present in their property or that its presence otherwise caused their property to be unusable or uninhabitable. Presence in the community may not be sufficient to prove the coronavirus made the insured property uninhabitable or unusable.

One of the items of proof required for the triggering of coverage under the civil authority provisions of a commercial property policy is that the alleged business loss was caused by an action by the civil authority that prohibited access to the insured premises. Relying on out-of-state jurisprudence, one Louisiana federal court has determined this factor requires proof that access to the insured premises be “actually and completely prohibited,” which is not satisfied if the access is merely “limited or hampered.” Kean, Miller v. National Fire Ins. Co. of Hartford, C.A. No. 06-770 (M.D. La. Aug. 29, 2007), 2007 WL 2489711, *4-*6. The state orders expressly referenced in the Cajun Conti suit would appear not to satisfy this standard as they served only to limit occupancy and required earlier closures. Even the subsequent stay-at-home orders [Proclamation Number 33 JBE 2020 and 41 JBE 2020, issued respectively on March 22, 2020 and April 2, 2020], may likely be insufficient to satisfy this requirement as they do not expressly mandate closure of restaurants, but simply require restaurants to “reduce operations to continue minimum contact with members of the public,” expressly allow for curbside delivery, drive-thru, and delivery services, and only prohibit the consumption of food and beverages on site.

The specific facts of each business interruption claim and the terms of the relevant policy should be considered in every occasion. Yet, these suits may face problems of proof generally. For now, we expect the novel suits to continue.

John has been practicing over 30 years and is a Senior Partner with firm where he serves on the Management Committee. He has devoted attention to non-profit boards dedicated to assisting at risk children. He enjoys time with his three children and grandchildren. He also enjoys tennis and hiking.

Nancy B. Gilbert is a partner with Keogh Cox in Baton Rouge, Louisiana. She is a puzzle-solver by nature, and specializes in providing clear and in-depth analysis of complex litigation issues.

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Impact of the U.S. Supreme Court’s Decision in Trump v. CASA, Inc. on Universal Injunctions and Class Actions

On June 27, 2025, in an Opinion authored by Justice Amy Coney Barrett, the United States Supreme Court determined that “universal injunctions,” injunctions issued by district judges that apply nationwide, “likely exceed the equitable authority that Congress has given to federal courts.” In Trump v. CASA, Inc., the Supreme Court, with a 6-3 vote, concluded that district courts do not have authority to issue universal injunctions which seek to prohibit the enforcement of a law or policy against anyone nationwide. The decision limits the relief afforded by the district courts in consolidated matters to only the parties in those actions.

By prohibiting the use of “universal injunctions” in federal courts, litigants already have started to utilize another procedure to seek the relief they seek – class actions. Class actions are a special procedure provided by both federal and state law that allows one or more class representatives to file suit and seek to represent the interests of other similarly situated individuals or companies. Prior to the Supreme Court’s ruling in Trump v. CASA, Inc., a single litigant could apply for a universal injunction through an individual action. Now that the Supreme Court has declared that process unavailable for application of an injunction nationwide, class actions may be the procedural process litigants attempt to use to achieve that same purpose. It remains to be seen whether class actions will be an effective way to achieve broader relief for individuals impacted by government policies.

References:

Trump v. CASA, Inc., --- S.Ct. ---, No. 24A884, 2025 WL 1773631 (U.S. June 27, 2025).

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Click It: The Seat Belt Defense In Louisiana

Louisiana has exhibited a certain double standard when it comes to seat belts. For years, Louisiana participated in the “Click It or Ticket” public service campaign that lectured on the grave dangers caused by a failure to wear seat belts and the criminal consequences for a failure to comply. Nevertheless, and for decades, the failure to wear a seat belt was off limits as evidence to reduce a plaintiff’s recovery in a personal injury context. But, the rule was changed: effective January 1, 2021, the “gag rule” against evidence that a plaintiff failed to wear a seat belt in an accident has been lifted. La. R.S. 32:295.1. Louisiana has no recent history with the “seat belt defense,” such that many questions arise. To frame these questions, this blog takes a quick look to cases from other states and certain guideposts that may already exist in Louisiana jurisprudence.

Like several other states, Florida has a history with the defense. In Smith v. Butterick, 769 So.2d 1056, 1058-9 (Fla.2d DCA 2000), the court outlined three elements of proof a defendant must show to prevail on the defense. Similar elements have been identified in other states. See, e.g., Law v. Superior Court In and For Maricopa County, 157 Ariz. 147, 755 P.2d 1135 (1988). Louisiana may adopt similar elements or chart a different course. The elements outlined in Smith were as follows:

1-Failure to use an available, operational seat belt

This element can be proven through testimony from the plaintiff, passengers, responding law enforcement, or other such testimony or evidence to show that a seat belt was not in use at the time of the accident. Similarly, testimony or photographs may be used to show that the seat belt was operational.

2- Failure to use seat belt was unreasonable under the circumstances

Insofar as Louisiana and most states generally mandate the use of seatbelts, this element should be easy to demonstrate. Therefore, unusual facts may be necessary to excuse a plaintiff’s failure to use a seat belt such as an emergency trip to the hospital.

3-Plaintiff’s failure to use a seat belt substantially caused or contributed to the damages

Of the three possible elements, this is likely to be the battleground. In some cases, the issue may be simple. For instance, if a plaintiff’s failure to use a seatbelt allows their body to strike (or travel through) a windshield, it may be simple to show that the plaintiff’s (or decedent’s) failure to use a seatbelt magnified the injuries. Expert testimony may not even be needed. In Smith, testimony from a mechanical engineer that the passenger would not have hit interior surfaces had they used a seat belt was allowed. However, will expert testimony be required in most cases and what type of expert will be needed? Engineer? Physician? Biomechanical?

Will the defendant bear the burden to prove the aggravation like they have in many national cases? Will Louisiana courts fashion an inference or “shifting burden” approach where a prima facie showing that a plaintiff’s whose failure to wear a seat belt increased the possibility of injury would possess the burden to show their injuries would have occurred even had they used a seat belt. In Anderson v. Watson, 953 P. 2d 1284 (Colo. 1998), the court required the defendant to only show a prima facie case of seat belt nonuse to allow the fact of nonuse to go to the jury.

Seat belts are required because they can prevent or lessen injury. Does a defendant have to show the precise details as to how seat belt nonuse caused or magnified the injury? In Louisiana, these answers remain unclear; but these are some of the questions.

Further complications are present in cases involving alleged traumatic brain injury (TBI) and the new frontier of vestibular injuries. Louisiana courts have often rejected testimony from accident reconstruction or bio-mechanical experts for a variety of reasons, but with this statutory defense, such testimony may be critical to determine who is responsible for an alleged catastrophic loss. States that recognize this rule have examined many factors that relate to the injuries that arise from the failure to use a seatbelt. As such, it seems inevitable that expert testimony on this issue must be considered in many nonuse cases.

No doubt, many of these questions will be the subject of litigation arising from accidents which occur after January 1, 2021. Louisiana’s double standard has ended. What is certain is that a failure to wear a seat belt now has the potential to harm not only a plaintiff’s health, but also their chances of recovery in civil litigation.

Collin is a Keogh Cox partner who litigates injury, commercial, and legal malpractice disputes. He lives in nearby Zachary, Louisiana with his wife Melissa and three all too active children. He is an outdoorsman, a tennis player, a cook, and a hobbyist writer.

This blog was written in partnership with John P Wolff, III.

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Nursing Home Liability: Big Brother is Watching Granny?

As an integral theme to his best-selling novel Nineteen Eighty-Four, George Orwell once used the slogan: “Big Brother is Watching You.” This slogan embodied the idea that a person’s actions and intentions are being monitored by the government as a means of controlling and suppressing the will of the populace.

Although not as extreme as Orwell’s dystopian novel, Louisiana families will now be able to install video monitoring systems in their loved ones’ nursing home rooms pursuant to Act 596 of the 2018 Regular Session of the Louisiana Legislature. According to the “Nursing Home Virtual Visitation Act,” nursing homes can not prohibit the cameras or retaliate against residents who want to install them. The video systems will monitor residents who often cannot speak for themselves.

However, several requirements must be met to abide by the Act:

The resident, or family if the resident lacks capacity, must provide notice of installation to the facility;
Visual recordings must include date and time;
The device must be stationary and fixed, not oscillating;
Residents must pay all costs for installation, upkeep, and removal;
Written consent is required from all roommates;
Room changes are required if a roommate does not consent;
Residents and applicants cannot be retaliated against for authorizing devices; and
Signage must be installed at the front door of the facility (at the facility’s cost) and at the resident’s room (at the resident’s cost) advising of surveillance in the rooms.

Furthermore, nursing homes must provide forms to nursing home residents, or their legal guardians, outlining the ways the cameras can be installed. Under the Act, surveillance should be addressed at admission as a resident right. To promote compliance, the Act prohibits the use of any recordings in litigation when the device was installed or used without the nursing home’s knowledge or used without adherence to the required forms. Additionally, compliance with the Act is a complete defense against lawsuits brought purely because monitoring devices are in use.

Nursing facilities and the families of residents and patients should take care to comply with all of the requirements in the act to ensure that the video footage is actually admissible and that the facilities are not opening themselves to privacy lawsuits from other residents. “Big Brother” might not be watching, but the increase in affordable, high quality, surveillance cameras, coupled with the Virtual Visitation Act, means nursing facilities should anticipate that someone could be watching very soon.