A Kansas City jury decided in favor of the insurer in the nation’s first jury trail of a lawsuit that sought coverage for business-interruption losses caused by the coronavirus.

The jury for the U.S. District Court for Western Missouri on Thursday returned a verdict in favor of Cincinnati Insurance Co. in a lawsuit filed by K.C. Hopps. The chain of nine bars, restaurants, catering services and event spaces had argued coverage was owed for lost income because SARS-CoV-2 had caused a direct physical loss or damage.

“We thank the jury for their time and attention through the trial,” Cincinnati said in a statement on Friday. “We are pleased that they unanimously agreed with us that our commercial property insurance policy does not provide coverage for these Covid-19 losses.”

U.S. District Judge Stephen R. Bough was one of the few federal judges who allowed COVID-19 business-interruption claims to proceed to trial, after ruling that the policy could be interpreted to provide coverage. In 90% of the cases decided in federal court so far, district court judges granted insurers’ dismissal or summary judgment motions.

The 6th and 11th and 9th US Circuit Court of Appeals also ruled in favor of insurers in COVID-19 business-interruption lawsuits.

Plaintiffs’ attorneys lauded the victory when Bough on Aug. 12 denied Cincinnati’s motion to dismiss K.C. Hopps’ lawsuit. But attorneys for the restaurant chain were disappointed when Bough denied their motion on Oct. 22 to prohibit Cincinnati from telling the jury that exclusions in the policy do not apply to the business-interruption claims.

K.C. Hopps on Oct. 23 filed a motion seeking an order regarding the court’s policy interpretation and to revise proposed jury instructions, stating that Bough had ruled previously that the exclusions do not apply.

“Plaintiff reasonably took the court’s statement that the exclusions ‘do not apply’ to mean that they were inapplicable as a matter of law,” the motion says.

The complaint filed by K.C. Hopps states that the nine businesses within the chain were expecting to earn $17 million in 2020, but government closure orders had drastically reduced revenues. The plaintiff presented evidence that SARS-CoV-2 can linger on surfaces and spread through ventilation systems, meeting the definition of a direct physical loss.

One other COVID-19 business-interruption lawsuit has gone to trial, but that case was decided from the bench. New Orleans Parish Judge Paulette R. Irons ruled on Feb. 10 in favor of Lloyd’s of London in a lawsuit filed by Cajun Conti, which owns a restaurant in the New Orleans French Quarter.

About the photo: Barley’s Brewhouse in Shawnee, Kansas, shown here, is one in a group of nine restaurants and other businesses that have filed suit seeking coverage from Cincinnati Insurance Co.

*This story ran previously in our sister publication Claims Journal.