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Insurers’ COVID-19 Notepad: What You Need to Know Now - Week of October 31, 2022

Client Alert | 2 min read | 10.31.22

Courts Dismiss COVID-19 Business Interruption Claims

On October 25, 2022, the Ninth Circuit affirmed the dismissal of a restaurant operator’s COVID-19 business interruption claims. Relying on United Talent Agency v. Vigilant Ins. Co., 77 Cal. App. 5th 821 (2022) and Musso & Frank Grill Co. v. Mitsui Sumitomo Ins. USA Inc., 77 Cal. App. 5th 753 (2022), the court concluded that the plaintiff could not recover COVID-19 related business losses because “the virus did not cause ‘direct physical loss or physical damage’ or ‘risks of physical loss’ as California courts have interpreted these phrases.” Opinion at 4-5. The case is Protégé Rest. Partners LLC v. Sentinel Ins. Co., Ltd.

On October 21, 2022, the Ninth Circuit affirmed a grant of summary judgment to Hartford Fire Insurance Company on a group of hotels’ COVID-19 business interruption claim. Relying on both Ninth Circuit and California Court of Appeal case law, the Court held that plaintiffs failed to allege physical alteration to their property and that it was not an abuse of discretion to deny plaintiff’s request for a continuance pending further discovery. Opinion at 3. The case is BA LAX, LLC v. Hartford Fire Ins. Co.

On October 21, 2022, the district court for the District of Nevada granted Security National Insurance Company’s motion to dismiss a restaurant owner and operator’s COVID-19 business interruption claim. Relying on prior district precedents, the court held the plaintiff failed to allege any plausible physical loss or damage to covered property and therefore failed to state a claim for business income or civil authority coverage. Order at 4-5. The court also held that the virus exclusion in plaintiff’s policy unambiguously barred coverage. Id. at 6-7. Finally, the court dismissed the plaintiff’s bad faith and misrepresentation claims because Security National had a reasonable basis to deny coverage and the policy was unambiguous. Id. at 7-8. The case is WFTLVO1, LLC v. AmTrust N. Am., Inc.

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Client Alert | 5 min read | 12.12.25

Eleventh Circuit Hears Argument on False Claims Act Qui Tam Constitutionality

On the morning of December 12, 2025, the Eleventh Circuit heard argument in United States ex rel. Zafirov v. Florida Medical Associates, LLC, et al., No. 24-13581 (11th Cir. 2025). This case concerns the constitutionality of the False Claims Act (FCA) qui tam provisions and a groundbreaking September 2024 opinion in which the United States District Court for the Middle District of Florida held that the FCA’s qui tam provisions were unconstitutional under Article II. See United States ex rel. Zafirov v. Fla. Med. Assocs., LLC, 751 F. Supp. 3d 1293 (M.D. Fla. 2024). That decision, penned by District Judge Kathryn Kimball Mizelle, was the first success story for a legal theory that has been gaining steam ever since Justices Thomas, Barrett, and Kavanaugh indicated they would be willing to consider arguments about the constitutionality of the qui tam provisions in U.S. ex rel. Polansky v. Exec. Health Res., 599 U.S. 419 (2023). In her opinion, Judge Mizelle held (1) qui tam relators are officers of the U.S. who must be appointed under the Appointments Clause; and (2) historical practice treating qui tam and similar relators as less than “officers” for constitutional purposes was not enough to save the qui tam provisions from the fundamental Article II infirmity the court identified. That ruling was appealed and, after full briefing, including by the government and a bevy of amici, the litigants stepped up to the plate this morning for oral argument....

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