Attorneys for the Las Vegas casino Circus Circus LV LP and AIG Specialty Insurance Co. on July 12 submitted briefs to the Ninth Circuit Appeals Court in the case Circus Circus LV LP v. AIG Specialty Insurance Co.
The casino sued the insurance company in Nevada federal court July 2020 for breach of contract for losses related to the pandemic after AIG refused to pay the claims, saying there was no physical loss or damage to trigger coverage. A lower federal court agreed with the insurance company.
In its brief, AIG argues that the casino’s claim “defies common sense” because it was still able to access its property despite executive orders by Governor Steve Sisolak for most workers to stay home and for casinos to close.
In its brief, Circus Circus told the federal panel that the lower court’s ruling was “wrong from the very first sentence” because the casino’s complain was not about economic losses but coverage of physical loss and damage related to contamination by the virus.
AIG counters that Covid-19 is not perceptible to human senses, unlike cat urine, smoke and gas fumes that were cited by Circus Circus to bolster its claims.
Christopher J. Cunio from Hunton Andrews Kurth LLP, which represents Circus Circus, commented about the case, claiming that the insurance company couldn’t refuse the allegations as required by the rulings in Bell Atlantic Corp. v. Twombly and Ashcroft v. Iqbal and added, “allegations of persistent and pervasive physical alteration of the content of the indoor air and the characteristics of the surfaces” at the casino satisfy Nevada law.
United Policyholders, a nonprofit that provides information to insurance customers, has endorsed Circus Circus’s contention. JC Hospitality LLC, the owner of the Virgin Hotels Las Vegas and Casino, and Boyd Gaming Corp. neighbors of Circus Circus, have filed friend of the court briefs in support of the casino.
