Widely covered by the media, a Los Angeles state court refused to dismiss the pandemic-related event cancellation litigation filed by heavy metal band Metallica stemming from the postponement of their 2020 South American tour.  The court held that Metallica alleged multiple events that could be the efficient proximate cause of the loss and that dismissal on the pleadings was improper despite the policy’s use of a “communicable disease” exclusion.

In an interview with Business Insurance, Partner Jeffrey Schulman explained that the fact that concerts and professional sports are being played with fans in the seats, while “the virus is still pretty much here, undercuts the argument that it caused the cancellations.”

In the Westlaw Today article, Schulman added, “The court held that the complaint sufficiently alleged that travel restrictions, the duty to mitigate damages, the need to flatten the curve, and stay-at-home orders may be the efficient proximate cause of Metallica’s losses.”

This is one of a select few COVID-19 insurance coverage disputes to recognize that something other than the virus or disease is the efficient proximate cause of an insured’s pandemic losses.

Read the full Business Insurance article here.

Read the full Westlaw Today article here.