Property Loss and Business Interruption

Goldberg Segalla’s team of property and business interruption attorneys understand that to best serve our clients, we need to do more than understand first-party property law. We understand the pitfalls and dangers that can abound in these kinds of claims, and the special challenges that natural disasters, such as hurricanes, tornados, and floods can present. Whether our clients are confronted with a suspicious fire or a thousand residential and commercial claims from a “CAT,” we have the experience and commitment to provide proactive, cost-efficient, and goal-oriented assistance.

Our experience as lead counsel and coordinating counsel for several insurers with respect to Superstorm Sandy and Hurricane Matthew affords us the opportunity to cull the collective wisdom of our nationally recognized coverage, extra-contractual, and fraud attorneys who handle matters across the country. Our approach is always driven by one over-arching value, whether in a single homeowner’s claim or a large commercial loss — to understand our clients’ goals and work together to accomplish them.

The extraordinary scope of services we provide, which leads to exceptional value for clients, include:

  • Attention to public relations and other strategic values; alignment of claim-handling processes and other company business units
  • Identification of regulatory standards, with constant monitoring and updates
  • Identification and recommendation of key experts in “real time” for claim-handling purposes and for litigation purposes
  • Coordination of onsite activities where appropriate
  • Analysis of coverage issues; drafting coverage analyses and reservation of rights letters
  • Examinations under oath and use of various investigative resources
  • Development of claim-review protocols to avoid extra-contractual risk
  • Litigation, where necessary, including high-stakes cases
  • Appraisal and alternative dispute resolution

Representative Matters

  • 9/11 World Trade Center. Goldberg Segalla attorneys represented a domestic commercial property insurer in the World Trade Center Property Insurance Litigation. The case involved the scope of property insurance coverage for the lease-holder of the Twin Towers following the 9/11 attacks. The case, culminating in a four-month trial in the U.S. District Court for the Southern District of New York, resulted in a jury verdict in favor of the client and other domestic and international insurers. The jury found that the terrorist attack resulted from one occurrence under the applicable insurance forms. The case remains one of the largest and most significant insurance coverage disputes ever to be litigated in this country.  
  • $8 Million Arson Case Dismissed. Goldberg Segalla attorneys represented a commercial property insurer in a coverage/bad faith case that was filed in the U.S. District Court for the Western District of North Carolina. The case involved an $8 million dispute over a commercial property insurance policy arising from a fire that destroyed a historic inn in Asheville, N.C. The jury found that the fire was intentionally set by the manager of the LLC that owned the inn. The LLC was the named insured on the policy. The significance of the case legally is that the manager who was found to have been involved in the arson was a minority member of the LLC. Thus, the majority shareholders of the named insured LLC claimed a right to recover even if the jury found that there had been an intentional burning by the manager. On an issue with very little guidance in the nation, the court instructed the jury that the acts of the manager would be imputed to the LLC (and thus bar the entire claim) if the manager both participated in setting the fire and also exercised “substantial control” over the affairs of the LLC. The jury found in favor of the insurer on both issues, returning a complete defense verdict that was sustained on post-trial motions. All contractual and bad faith claims were dismissed. No appeal was taken.
  • Superstorm Sandy. Early in Superstorm Sandy litigation, by utilization of motion practice and reliance on Fed. R. Civ. P. 11, we secured agreement of the lead plaintiff’s firm to drop all state law extra-contractual claims against our clients.
  • Appellate Decision Protecting Privilege and Reserves. In this state court commercial property loss case arising from Superstorm Sandy, we secured an appellate decision that served as a primer on the treatment of privilege and reserves in first-party extra-contractual litigation. The appellate court declared reserves were not discoverable, stayed the extra-contractual claim, and remanded the case for in-camera review of privileged documents.
  • Novel Arguments to Defeat Ordinance Compliance. The insured, a bar owner, seeks business income and business personal property losses in connection with a period of shutdown resulting from a construction project to correct ordinance violations. We are advancing two novel arguments to defeat the claim. First, although certain losses stemming from the ordinance violations are arguably covered under the policy, the settling exclusion bars coverage in light of the policy’s anti-concurrent causation clause. Second, we contend this claim violates the fortuity requirement because the owner was aware prior to the inception of the policy that the construction project would commence during the policy period.
  • Roof Collapse Does Not Require State of the Art Reconstruction. When the roof of a 41-year-old ice rink in New England collapsed, the insured sought to rebuild the facility from the first brick, to “state of the art” standards. Our experts established that the insured was seeking far more than to “repair or replace.”
  • $20 Million Fire Loss. The claim involved a fire at a 100-year-old warehouse in Chicago. The fire gutted the building. The policy had limits of $20 million. The circumstances of the fire were very suspicious, the sprinkler system was disabled, and the fire occurred over a holiday weekend when the building was vacant. Goldberg Segalla supervised the cause and origin investigation, including working with cause and origin and sprinkler system experts, and developed facts that led to the conclusion that the increased hazard provision applied. The insurer denied coverage and litigation followed. The case settled for a favorable amount during discovery.