Musso & Frank Grill Co. Inc. v. Mitsui Sumitomo Insurance USA Inc.
The Los Angeles Superior Court handed down a loss for Musso & Frank Grill Co., Inc., an iconic Los Angeles restaurant, when they ruled that it was not entitled to coverage for losses caused by COVID-19 under the eatery’s all-risk policy. The Court sided with defendant/ insurer Mitsui Sumitomo Insurance USA, Inc. when they found that COVID related business shut-downs, mandated by the State of California, did not qualify as the “direct physical loss” requisite to trigger coverage. The Court added that even if the forced closure of the restaurant constituted a direct, physical loss, the virus exclusion of the policy would bar coverage as well. Attorneys for Musso & Frank told that they expected this case, along with the many others across the state dealing with COVID related coverage, to be decided at the appeals court or even California Supreme Court level.