1st Cir. Upholds Dismissal of Legal Sea Foods’ COVID-19 Coverage Action

BOSTON — The 1st Circuit U.S. Court of Appeals has upheld dismissal of Legal Sea Foods’ COVID-19 coverage action, affirming that neither government orders nor the virus itself caused the restaurant corporation to sustain “direct physical loss of or damage” to its insured properties.

In a June 3 opinion, the appellate panel referred to the Massachusetts Supreme Judicial Court’s ruling that “direct physical loss of or damage to” property requires some “distinct, demonstrable, physical alteration of the property."

Legal Sea Foods operated 34 restaurants in Massachusetts, the District of Columbia, New Jersey, Pennsylvania, Rhode Island, and Virginia. The chain suspended …