Article/Mention

Micah Skidmore Talks With Business Insurance About Continued COVID-19 Legal Battles

August 11, 2021

Haynes and Boone, LLP Partner Micah Skidmore talked with Business Insurance about how some state supreme courts are considering cases involving COVID-19-related business interruption coverage.

Below is an excerpt:

While policyholders continue to lose most COVID-19-related business interruption coverage disputes, a clear picture on the issue will likely not emerge before state supreme and federal appellate courts issue more rulings on the issue.

Insurers so far have largely argued successfully that the coronavirus does not result in physical loss or damage to property – the critical issue in many COVID-19 cases – and therefore lost revenue is not covered under all-risks policies. Federal courts in particular have mainly ruled in favor of insurers, but policyholder attorneys say it is too soon to draw any conclusions on the overall eventual outcome.

Observers estimate that of about 20,000 cases filed, 90% of federal court cases have been decided in the insurer’s favor, compared with 75% of state court cases. Experts have a range of theories that explain the discrepancy, but there is no clear consensus as to why this has occurred.

… Policyholder attorney Micah E. Skidmore, a partner with Haynes and Boone, LLP in Dallas, said policyholders have asked that several cases filed in federal appeals courts be referred to the relevant state supreme court. He said this “makes a lot of sense” because these cases ultimately involve contractual interpretation issues, which are matters of state law.

No state supreme courts have issued rulings on the issue yet, and only one federal appeals court, the 8th U.S. Circuit Court of Appeals in St. Louis, has issued a decision, which was in insurers’ favor.

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