NFL team Philadelphia Eagles are seeking to revive a lawsuit against Factory Mutual Insurance Co. (FM Global) regarding COVID-19-related business interruption coverage.
A US district court dismissed the case in October, referencing Pennsylvania Supreme Court rulings, particularly in the "Ungarean v CNA" case, which established that physical damage is necessary to trigger business interruption coverage.
The Eagles’ legal team highlighted that CNA’s policy requires physical alterations—such as “repair”, “replacement”, or “rebuilding”—to activate coverage, according to a report in BestWire.
In a motion for reconsideration, the team argues that the language in FM Global’s (now FM) policy differs from that of other insurance policies used in similar cases.
The Eagles argue that FM Global’s policy does not contain these same requirements. According to their counsel, the policy does not specify that property must be physically repaired or replaced for coverage to apply.
The Eagles also cited a ruling by the Third Circuit Court of Appeals, which found that coverage could apply if a business’s operations became unviable due to a harmful substance, even if it was not physically visible.
While FM Global can challenge whether COVID-19 was present in the stadium or the level of threat it posed, the Eagles contend that these issues should be addressed through discovery and expert testimony.
They also argue that FM Global’s interpretation of its own policy has not been fully considered by previous courts. In several instances, including in communications with state regulators, internal claim guidelines, and court filings, FM Global acknowledged that communicable diseases can cause “physical loss” and “physical damage”, it was stated.
In a 2019 court filing, FM Global noted that the presence of mold, a disease-causing substance, could result in physical loss and render property unsuitable for its intended purpose.
FM Global declined to comment on the Eagles’ motion for reconsideration, the BestWire report stated. Efforts to reach the Eagles' legal representatives for comment were unsuccessful.
What do you think of the Eagles' efforts to revive the lawsuit? Share your thoughts in the comments.
