July 30, 2020

Four local restaurant groups took legal action against Travelers for denying claims during the pandemic

Restaurant groups led by José Andrés and three other high-profile chefs based in D.C. sued their insurance carriers this week, joining a growing number of hospitality companies fighting for payouts triggered by business interruption policies they claim should cover losses during the COVID-19 pandemic.

Both Andrés’s ThinkFoodGroup (TFG) and Central, the James Beard Award-winning American bistro that carries on the legacy of its late chef/founder Michel Richard, filed lawsuits on Wednesday, July 30, in Maryland and District of Columbia federal courts, alleging Travelers Insurance Company wrongfully rejected coverage for business losses during the novel coronavirus pandemic.

The lawsuits come days after Fabio Trabocchi’s Fiola Holdings and Robert Wiedmaier’s RW Restaurant Group took similar legal action against their carrier The Charter Oak Fire Insurance Company (Travelers). Michelin-rated Fiola, Fiola Mare, Del Mar and three Sfoglina locations are listed in the suit; RWRG’s filing is related to eight of Wiedmaier’s restaurants, including elegant French eatery Marcel’s in Foggy Bottom.

TFG’s lawsuit is tied to 16 of the group’s restaurants covered under the Travelers’ policy, including the Michelin-rated Minibar, Jaleo, Oyamel, Zaytinya, China Chilcano, Beefsteak and other operations. Much of the named TFG portfolio is concentrated in Penn Quarter, which has become a ghost town without hotel and foot traffic fueled by now-empty Capital One Arena. Central’s placement on Pennsylvania Avenue NW has also suffered from a loss of visitors since the start of the pandemic.

. . .

All groups are repped by D.C.-based Cohen Milstein Sellers & Toll PLLC, and California-based Gibbs Law Group, which joined forces to create a COVID-19 Business Interruption Insurance Coverage Task Force to take on new restaurant and small business clients across the country that have been financially affected by insurance companies’ refusal to pay.

“It’s devastating to see Washington D.C.’s vibrant restaurant industry struggle to stay afloat from this pandemic as insurance companies rake in billions of dollars of their insureds’ premiums, refuse to pay their contractually agreed-upon coverage and idly watch their policyholders suffer,” says Cohen Milstein Sellers & Toll partner Geoffrey Graber, in a statement.

In early April, downtown’s upscale sports bar Proper 21 was the first D.C. restaurant to spark a legal battle over coverage as its dining rooms remained closed during the coronavirus crisis. A few weeks later, White House-adjacent grilled cheese bar GCDC filed a class action suit against insurance carrier Hartford for denying coverage of business it lost during the novel coronavirus pandemic.

The complete article can be accessed here.