JDS Construction Group Lawsuit Carries Onward After Refusal to Dismiss

On Thursday, August 12th, it was announced that the JDS Construction lawsuit will carry onward after an Illinois court refused to dismiss the case. Construction and management firms, JDS Construction Group, LLC and 9 Dekalb Fee Owner LLC filed a claim against Continental Casualty Co, citing business interruption triggered by COVID-19. The claimants allege that there was proof of physical damage or loss, which is insured under their policy.

According to the judgment, both JDS and 9 DeKalb were covered under a builder’s risk policy from March 2019 to June 2022. In declining to dismiss the lawsuit, the Illinois court stated that the claimant alleged that the virus triggered physical damage or loss, which is needed for insurance under the policy. For example, the judgment stated that the plaintiff claimed that “the COVID-19 droplets or nuclei were present on solid surfaces and in the air at the insured property, and that the virus, a physical substance, has adhered and adhered to plaintiffs' properties."

Besides that, the plaintiffs allege in greater depth how virus drops are transmitted from infected individuals to any hard surfaces in the property, into the air, heating, and air-conditioning system, resulting in damage, and altering the property and the air from being breathable and safe to unsafe and dangerous. In addition, the ruling alleges that the virus can survive on the surfaces for a longer length of time.

The court also concurred with the claimants that they had sufficiently established that the actual physical loss prompted the policy's civil authority coverage.

Attorney Cohen, one of the all-women team representing the claimants, gave the following remark regarding the case, which is one of the few thus far that appears to benefit the policyholder at this juncture in the litigation: "This judgment is a win for policyholders requesting business interruption insurance as a result of the epidemic that will be felt well beyond Cook County."

She further stressed that the judgment would be influential in Illinois, and it could possibly prompt some analysis in New York as the judge found that the virus, as claimed, could trigger damage or loss under both New York and Illinois legislation. She went on to say that these claims are "based upon the science."

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