Viruses are not like fires, so court dismisses suit by Davio's restaurant chain for losses related to Covid-19

The Massachusetts Appeals Court today tossed a lawsuit by the owner of the Davio's chain of Italian steakhouses against its insurer, which had told Davio's that its "all risks" policy did not, in fact, cover all risks, specifically losses from being forced to close or limit service in dining rooms during the Covid-19 pandemic.

The appeals court relied on a similar ruling by the Supreme Judicial Court in 2022 by the owner of Coppa and Toro in the South End and Little Donkey in Central Square: That "all risks" insurance policies referred to physical damage to restaurant property from fire, smoke and other causes, and that the Covid-19 virus, no matter how thickly it may have settled on restaurant tables from coughing customers, did not cause permanent physical damage.

In both cases, the restaurant suits were against the Strathmore Insurance Co.

In today's ruling, the appeals court concluded that Davio's, which has restaurants in the Back Bay and the Seaport, failed, just as the restaurant owner in the earlier case had, to prove that viral particles were anything more than an "[e]vanescent presence of a harmful airborne substance that will quickly dissipate on its own, or surface-level contamination that can be removed by simple cleaning, does not physically alter or affect property."

The plaintiffs alleged that virus particles settled on the plaintiffs' property; the plaintiffs had to take "extraordinary measures," including cleaning their property, to combat the virus; and that some virus particles remained even after cleaning. However, the plaintiffs also alleged that, through cleaning and other measures, the plaintiffs' restaurants remained in use throughout the pandemic. The plaintiffs specifically alleged, "[T]here have been hundreds (if not thousands) of infected guests on-site since the pandemic's outset." These allegations do not show that the virus physically altered or affected the insured property in any way. Rather, they show the "[e]vanescent presence of a harmful airborne substance," [as described in the Coppa decision], and that there was no direct physical loss or damage to property.