To Be or Not To Be Specific—Fact Pleading in Louisiana

The COVID-19 pandemic had a profound impact on the global economy. Louisiana was not spared, and many businesses had to close as sales to their customers slowed or stopped altogether. Not surprisingly, the question arose regarding whether business interruption insurance would provide coverage to businesses in this situation. The Louisiana Supreme Court recently was asked this question in Cajun Conti, LLC v. Certain Underwriters at Lloyd’s, London and found that the policy at issue did not provide such coverage.

The mayor of New Orleans issued a proclamation on March 16, 2020, that prohibited most public and private gatherings. This applied to restaurants, whose business initially was limited to takeout and delivery services. Before the pandemic, Oceana Grill, a restaurant located in the French Quarter, could serve up to 500 customers at one time. However, it had to limit its business to takeout and delivery services when the mayor’s proclamation was announced. Because of social distancing guidelines, it remained at 60% or less capacity throughout the pandemic.

Oceana maintained a commercial insurance policy with loss of business income coverage and filed suit to request a declaratory judgment that the “policy provides business income coverage from the contamination of the insured premises by COVID-19.” Oceana’s insurer argued that there was no coverage under the policy because COVID-19 did not cause “direct physical loss of or damage to property” under the policy’s terms.

The trial court denied Oceana’s request for declaratory relief at trial. The appellate court reversed and found the policy’s terms ambiguous because it held “direct physical loss” could mean loss of use of the property. Because the pandemic prevented the full use of the property due to capacity limitations, the appellate court found coverage was triggered.

The Supreme Court disagreed and reversed the appellate court’s decision, finding its focus on the use of the property to be misguided. The Court found that suspension of operations “caused by direct physical loss of or damage to property,” as defined by the policy, required “the insured’s property to sustain a physical, meaning tangible or corporeal, loss or damage.” The Court noted that the restaurant’s physical structure was not lost or damaged because of the pandemic. COVID-19 restrictions did not cause damage or loss that was physical in nature. Therefore, the policy did not provide coverage for loss of business income.

Whether a policy affords coverage depends on the terms and conditions of each policy and the facts of each case. However, in light of this decision, businesses with insurance policies that include provisions with language like that at issue in Cajun Conti should not anticipate coverage for loss of business income allegedly caused by the COVID-19 pandemic.

Case References:

Cajun Conti LLC v. Certain Underwriters at Lloyd's, London, 2022-01349 (La. 3/17/23), 2023 WL 2549132.

“There were eleven votes for 'guilty.' It's not easy for me to raise my hand and send a boy off to die without talking about it first.” - Reginald Rose, Twelve Angry MenJury service is a civil duty. Our system would collapse without the diligent individuals who respond and serve, but the law does provide exemptions and exceptions which may be utilized to be excused. Part 2 of this blog will explore those circumstances.General Exemptions

Louisiana provides two general exemptions from jury service.

1 - Age. Persons seventy years of age or older shall be exempt from jury service and may decline to serve as jurors. La. Const. Ann. art. V, § 33. However, they are free to serve if otherwise qualified.

2 - Prior Service. The second, all “persons who have served as grand or petit jurors in criminal cases or as trial jurors in civil cases or in a central jury pool during a period of two years immediately preceding their selection for jury service.” La. Sup. Ct. R. 25.

No exemption is automatic. A prospective juror qualifying for one of the above exemptions must assert the exemption by contacting the appropriate jury commission.

Recognized Excuses

In criminal cases, a juror may be excused when such service “would result in undue hardship or extreme inconvenience.” C.Cr.P. art. 783

In civil cases, a juror may be excused when service would result in “undue or extreme physical or financial hardship.” However, these circumstances are limited to circumstances in which an individual would:

1. Be required to abandon a person under his or her personal care or supervision due to the impossibility of obtaining an appropriate substitute care giver during the period of participation in the jury pool or on the jury; or

2. Incur costs that would have a substantial adverse impact on the payment of the individual's necessary daily living expenses or on those for whom he or she provides the principal means of support; or

3. Suffer physical hardship due to an existing illness or disease. La. Rev. Stat. Ann. § 13:3042

With respect to both criminal and civil service, a request for excusal can be mailed to the issuing court and should include an explanation of circumstances. In most cases, the letter must also include supporting documentation, such as, “state income tax returns, medical statements from licensed physicians, proof of dependency or guardianship, and similar documents, which the judge finds to clearly support the request to be excused.” “Failure to provide documentation shall result in a denial of the request for a waiver.” La. Rev. Stat. Ann. § 13:3042You should serve if you can but, if you need to be excused, questions regarding exemptions, excusals, and/or qualifications should be directed to the appropriate jury commissioner’s office.

A Workers’ Compensation Judge in Monroe, Louisiana found that a claimant met his burden of proving that a specific mosquito bite at work caused him to contract the West Nile Virus, resulting in permanent total disability.

At trial, the claimant asserted that “he specifically remembers being bitten on his left leg by a mosquito” while working in the break room of his employer, Graphic Packaging. Claimant presented evidence that mosquitoes were present at the work site, although his purported eyewitness to the event (who also contracted the disease) was proven to have not been at work that day.

The director of the Ouachita Parish Mosquito Abatement District was offered by the claimant and testified that there was a prevalence of mosquitoes in Ouachita Parish during that summer which carried the West Nile Virus. Mosquitoes trapped near both the employer’s location and the claimant’s house tested positive. According to the director, the only way to determine if a mosquito is infected with West Nile is to have that particular mosquito tested. An expert epidemiologist for the employer added that the most commonly infected mosquitoes would not have been active during the middle of the day when the claimant alleges he was bitten.

Based upon the testimony of the claimant, his witness, and the experts, the Workers’ Compensation Judge ruled that the claimant had sufficiently proven that the specific mosquito infected with the West Nile Virus had bitten him at work. The court also stung the employer and its workers’ compensation insurer with penalties and attorneys' fees, finding that they had not contested the claim on a reasonable basis.

The Court of Appeal in Allen vs. Graphic Packaging, No. 51,080 (La. App. 2d Cir. 1/11/17), - - So 3d - -, upheld the Workers’ Compensation Judge. The court noted that all proof of the “accident” rested upon circumstantial evidence and that the claimant possessed no direct evidence that the break room mosquito carried the disease. In this setting, the claimant “faced a burden of proof to show circumstantially that the break room mosquito carried the disease.” Utilizing the “manifest error or clearly wrong standard,” the appellate court held that the claimant had met his burden despite his indirect proof.

The Allen court ultimately reversed the finding of permanent total disability, because the Workers’ Compensation Judge misapplied the statutory requirements. It also reversed the award of penalties and attorneys' fees noting that “there were numerous factors sufficient to validate Graphic’s reasonable controversion of Allen’s claim.”