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Production Shop for the “Morning Show” loses COVID-19 lawsuit with $44 million in damages

The Morning Show’s production company was unsuccessful in its attempt to obtain more than $125 million in insurance coverage for losses resulting from COVID-19-related filming delays. According to a verdict published on Tuesday, a federal judge dismissed the lawsuit brought by Always Smiling Productions against Chubb National Insurance Company. U.S. District Judge Fernando Olguin determined that plans for “direct physical loss or damage” do not trigger coverage as a result of a body of case law that was piling up in favour of insurers.

After 13 days of filming, Always Smiling Productions informed Chubb in March 2020 that it was stopping work on the second season of the Apple TV+ show. Under the production’s civil authority coverage for governmental orders, the insurer agreed to pay out $1 million but declined to pay out any more. The production business filed a lawsuit in California federal court in July 2021 with $125 million in cast coverage. It put a $44 million loss estimate on them.

The judge was not persuaded. He stated: “In this instance, the court is not persuaded that Plaintiff has sufficiently alleged a ‘physical alteration of its property’ to qualify for coverage under the subject provisions. Olguin cited other situations in which the same conclusion had been reached despite claims that COVID-19 causes property, such as indoor air and surfaces, to develop a potentially fatal condition. He came to the conclusion that common cleaning supplies may remove viruses from surfaces.

2,300 lawsuits have been filed against insurers, according to Penn Law’s COVID Coverage Litigation Tracker. Roughly 96 percent of the 663 cases in federal court have been dismissed. While the majority of COVID-19 insurance lawsuits have been dropped, some businesses have been successful in negotiating agreements with their insurers. In July, Paramount reached a settlement in a case it had filed against Federal Insurance Company, alleging that the Chubb division had violated the terms of its insurance policy. According to the complaint, Federal agreed to cover any “loss” Paramount “directly and solely sustain by reason of any covered person in connection with an insured production, being necessarily prevented by their death, injury, sickness, or kidnapping from commencing or continuing or completing their respective duties in an insured production.”

Ahir Mitra
Ahir Mitra


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