Cohen Milstein has joined forces with Gibbs Law Group to create a unique national alliance to address an emerging issue affecting small businesses across the United States—the wrongful denial of business interruption insurance coverage for losses due to COVID-19.
COVID-19 and Business Interruption Coverage Claims
Many businesses that thought they were being responsible by securing and paying premiums for business interruption coverage are now facing mounting costs resulting from their insurance company’s failure to cover losses arising from COVID-19.
Small businesses across the country are being told by their insurers that their business interruption insurance, which is intended to replace business revenue lost due to a disaster, does not cover COVID-related losses.
In fact, if a policy covers building closures due to an order by a “civil authority,” a business may be covered if it was forced to close due to a shelter-in-place order.
Some policies, however, may contain a physical loss requirement, which may be more difficult to navigate. With these policies, the policyholder may have to prove that their business suffered a physical loss due to COVID-19.
Losses Typically Covered by Business Interruption
Projected unearned profits.
- Operating expenses and other fixed costs, including replacement machinery.
- Temporary business re-location costs.
- Employee wages, including benefits.
- Unforeseen expenses, beyond fixed costs, such as re-training expenses.
- Financial losses resulting directly from a civil authority order mandating the closure of business premises.
- Business taxes.
- Loan payments.
Businesses That May Be Most Vulnerable
This issue is affecting a wide variety of small businesses across a number of industry sectors—mostly brick and mortar businesses that depend on a high volume of customer traffic, including restaurants, bars, hotels, salons, gyms, and numerous other retailers and service providers.
What Government Officials Are Saying About Insurance Coverage
Many officials are now urging insurance companies to take business interruption claims more seriously. According to the Insurance Journal, California Insurance Commissioner Ricardo Lara issued a notice requiring insurance companies to fairly investigate all business interruption claims resulting from COVID-19 losses. The Journal quotes the Commissioner in saying:
I want to be absolutely clear that insurance companies need to fairly investigate all business interruption claims as they would during any disaster… Policyholders deserve all the services, coverage, and benefits they are due under their policy.
Our Goal and How We Can Help
Our goal is singular and clear. We are dedicated to representing small businesses that have been burdened with damages and costs resulting from their insurance company’s failure to cover COVID-related losses.
Working with you, we will assess whether your claim can be pursued as an individual or class action in state or federal court.
We believe that without strong representation to secure the insurance coverage to which they are entitled, many small businesses may not survive the current crisis.
Who We Are
Cohen Milstein’s award-winning Consumer Protection practice is at the forefront of representing individuals, retailers, restaurants, and other small businesses in insurance fraud and coverage litigation, having litigated individual and class action lawsuits against many of the leading health, life, and property and casualty insurance companies before state and federal courts across the United States.
We have received numerous accolades for our work in consumer law:
- Law360, “Practice Group of the Year – Class Action” (2017, 2020)
- Law360, “Practice Group of the Year – Consumer Protection” (2018, 2019)
- Benchmark Litigation, “Top 10 Plaintiffs Firm” (2019)
- The National Law Journal, “Winner – Elite Trial Lawyers – Consumer” (2018)
- Vault, “20 Best Litigation Boutiques” (2018)
Gibbs Law Group
Gibbs Law Group is a California-based law firm committed to protecting the rights of clients nationwide who have been harmed by corporate misconduct. We represent small businesses, individuals, whistleblowers, and employees across the U.S. against the world’s largest corporations. Our award-winning lawyers have achieved landmark recoveries and over a billion dollars for our clients in high-stakes complex lawsuits and individual cases involving consumer protection, data breach, digital privacy, and federal and California employment lawsuits. Our attorneys have received numerous honors for their work, including:
- Daily Journal, “Top Boutique Law Firms in California” (2019)
- Law360, “Titans of the Plaintiffs Bar- Eric Gibbs” (2019)
- Law360, “Class Action Practice Group of the Year” (2020)
- Daily Journal, “Two California Lawyer Attorney of the Year (CLAY) Awards” (2019)
- Daily Journal, “Top Plaintiff Lawyers in California- Eric Gibbs” (2019, 2016)
- Best Lawyers in America (2012-2019)
Andrew N. Friedman is Co-Chair of Cohen Milstein's Consumer Protection practice and is a nationally recognized leader in the area of complex, multi-state class action lawsuits against consumer service providers, such as insurers, credit card companies, banks and others. In 2019, Mr. Friedman was named a Law360 “MVP – Data Privacy and Security” for his successful leadership role in In re Anthem Data Breach Litigation, a historic data breach class action.
Geoffrey Graber leads Cohen Milstein’s Business Interruption Insurance team. Prior to joining Cohen Milstein, Mr. Graber had a distinguished career at the U.S. Department of Justice (DOJ), serving as Deputy Associate Attorney General. As a member of the Consumer Protection practice group, he specializes in complex litigation involving false advertising, fraud, and other forms of unfair business practices at the hands of insurance companies, banks, health care companies, and others.
Victoria S. Nugent is Co-Chair of Cohen Milstein’s Public Client practice. She represents State Attorney Generals in civil law enforcement investigations and litigation involving consumer protection, fraud, and other areas of enforcement.
Eric A. Kafka is a member of Cohen Milstein’s Consumer Protection practice. He also serves on Public Justice’s Class Action Preservation Committee.
Eric Gibbs is a founding partner at Gibbs Law Group. Eric has negotiated groundbreaking settlements that resulted in meaningful reforms to unlawful business practices. He was recently recognized as California Lawyer Attorney of the Year and was named to the Top Plaintiff Lawyers in California for 2019.
Andre Mura represents plaintiffs in high-stakes complex litigation and appeals in state and federal courts throughout the country. He has authored briefs filed in the U.S. Supreme Court and received the California Lawyer Attorney of the Year Award in 2019.
Amy Zeman represents clients in a wide variety of complex litigation, with experience working closely with class representatives and consumer contacts. She uses her prior career experience as an accounting/ compliance manager in the financial services sector to identify and investigate fraud claims.
Aaron Blumenthal represents consumers, employees, and whistleblowers in class action and other complex litigation.