Calif. Restaurant’s COVID-19 Coverage Action Dismissed with Leave to Amend

SAN JOSE, Calif. — A California federal judge has dismissed a restaurant’s COVID-19 business interruption coverage action without prejudice, finding it failed to allege it suffered ““direct physical loss of or damage to” its insured property, as required by the policy.

In a Feb. 8 order, Judge Beth L. Freeman found there was neither a physical change in the condition or a permanent dispossession of the property. However, the judge granted the restaurant leave to amend its complaint.

Protégé Restaurant Partners LLC was forced to stop in-person dining at its Palo Alto, Calif., restaurant in compliance with March 17, …