The Supreme Court today agreed to answer this question posed by the Ninth Circuit in Another Planet Entertainment, LLC v. Vigilant Insurance Co.: “Can the actual or potential presence of the COVID-19 virus on an insured’s premises constitute ‘direct physical loss or damage to property’ for purposes of coverage under a commercial property insurance policy?”
The court has shown no interest in COVID insurance issues when they arise in state court litigation. It denied petitions for review in three of those cases and denied a depublication request in a fourth. (See here.) The Court of Appeal opinion in the most recent review-denied case said that, of the COVID pandemic legal issues (related: the Supreme Court’s pandemic docket), the coverage issue is “[o]ne of the most momentous, in terms of the potential monetary liability.”
The court’s agreement to decide the question in Another Planet is big news, but not a big surprise, even after the consistent refusals to review state Court of Appeal opinions. The court rarely turns down a Ninth Circuit request for help in resolving questions of California law, having now granted 19 of the last 20 requests, dating back to July 2018. The lone denial during that time was in October 2019.
[April 10 update: Another Ninth Circuit panel today certified to the Oregon Supreme Court the identical question that California’s Supreme Court will answer in Another Planet. The Oregon case is The Oregon Clinic v. Fireman’s Fund Insurance Co.]