La. Court Upholds Business Interruption, Bad Faith Awards in Hurricane Katrina Coverage Dispute

NEW ORLEANS — A Louisiana appeals court upheld a judgment awarding the owners of three radio stations that were damaged during Hurricane Katrina $5.9 million in lost profits, finding the policyholders provided adequate evidence of their business interruption losses.

On Feb. 11, the Louisiana Court of Appeals, 4th Circuit, also upheld an award of $2.95 million in bad faith damages, finding AXIS Surplus Insurance Co.’s refusal to pay the policyholders’ claim was arbitrary, capricious or without probable cause

In August 2005, radio stations owned and operated by Citadel Broadcasting Corp. and Citadel Broadcasting Co. were damaged as a result of …