Talent Agency Brings $150 Million Lawsuit Against Insurer for Coronavirus Losses

The latest update in our ongoing coverage of business interruption lawsuits relating to the COVID-19 coronavirus pandemic takes us to Hollywood. Entertainment powerhouse United Talent Agency (UTA) recently filed a lawsuit against insurance providers Vigilant and Federal insurance for denying coverage connected to the stalled entertainment industry. Continue reading to learn about the case, and call a dedicated New York insurance coverage defense attorney for help with insurance coverage lawsuits.

UTA Alleges Millions in Pandemic Losses

UTA is a talent agency representing artists across the entertainment industry, including film, television, video games, publishing, and music. The coronavirus pandemic has obviously taken a massive toll on the entertainment industry, shutting down television productions, concerts, movie screenings, and many other profit-making efforts. UTA maintains commercial property and business insurance policies with Vigilant and Federal Insurance Co., members of the Chubb group.

UTA’s complaint alleges that it has suffered more than $150 million in losses as a result of the coronavirus pandemic. Losses have resulted from canceled TV and film production as well as the cancellation of several high-profile musical tours, affecting represented artists including Post Malone, Guns N’ Roses, Pitbull, and Toby Keith, among other pandemic-related cancellations. UTA maintains that these losses should be covered by its business interruption policies. Chubb has taken the blanket position from the beginning of the pandemic that business interruption policies do not cover COVID-19 losses. Those policies cover losses relating to “direct physical loss or damage” to property, rather than any event that disrupts an organization’s business ventures. According to Chubb (and many other insurers), those policies were clearly intended to cover events like fires and floods.

UTA, in turn, argues that Chubb’s position ignores the presence of the virus in the airspace, which should be covered by “physical loss,” and that Vigilant and Federal issued blanket denials of their claims without even conducting an investigation. UTA also alleges that the virus “was present on and in the vicinity of UTA’s premises,” and that over a dozen of their employees, as well as their spouses and children, have contracted the virus.

UTA’s claims are arguably even more attenuated than traditional brick-and-mortar businesses that have been forced to close due to governmental shut-in orders. The vast majority of their losses do not stem from any damage to their offices but instead result from the entertainment industry going on a general hiatus due to pandemic-related concerns. UTA faces an uphill battle, especially as courts around the country have already been reluctant to extend property insurance policies to COVID-related claims.

For dedicated and comprehensive legal guidance on a New York insurance defense or toxic tort claim, contact the Islip offices of Richard A. Fogel at 516-721-7161.