Federal Judge Dismisses COVID-19 Coverage Action, Finds No ‘Direct Physical Loss’

SAN ANTONIO, Texas — A federal judge has dismissed a COVID-19 business interruption coverage action brought by eight Texas barbershops, ruling that no “accidental direct physical loss to covered property” occurred, as required by the policy.

In an Aug. 13 order, Senior Judge David A. Ezra of the U.S. District Court for the Western District of Texas agreed with defendant State Farm Lloyds that plaintiffs failed to plead a direct physical loss and that their losses fall within the policies’ virus exclusion.

Plaintiffs are Outlaws & Gents Grooming LLC, Diesel Barbershop LLC, Wilderness Oak Cutters LLC, Diesel Barbershop Bandera Oaks …