Lawyer John Houghtaling is leading U.S. businesses in the biggest legal battle against insurance companies

Atty. John Houghtaling
Screenshot from YouTube video posted by Roofing Insights, John Houghtaling Exposes Insurance claims fraud

As the COVID-19 pandemic continues to rage on, one of the biggest legal fights in insurance history cracks open.

In the past months, the business sector has witnessed retailers, restaurateurs and other enterprises hard-hit by pandemic shutdowns turn to legal action to force their insurers to covers millions, if not billions, in business losses.

Plaintiffs’ lawyer John Houghtaling is leading the legal battle against insurance companies which assert that they don’t have to pay up claims caused by the COVID-19 shutdowns.

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On March 16, Houghtaling filed a petition in state court in Louisiana on behalf of the New Orleans restaurant Oceana Grill, asking a judge to declare preemptively that its insurance policy would cover damage caused by the virus, Bloomberg reported.

The case represented the opening salvo in what is touted as the single biggest legal battle to rise from the pandemic.

Insurance giants refuse to pay business-interruption claims

Insurance companies have largely refused to pay claims under “business interruption” insurance, citing a standard requirement for physical damage. Also known as “business income” coverage, this policy traces its legacy from the early 1900s as part of property insurance protecting manufacturers from broken boilers or other failing equipment that closed factories.

However, business owners argued they could go bankrupt unless they’re paid. On the other hand, insurance companies stated that the payouts could hurt them. The dispute is also playing out in Congress and state legislatures, where bills have been introduced requiring insurers to pay for pandemic-related losses.

John Houghtaling argues that coronavirus is a ‘physical threat’

In the Oceana Grill case, Houghtaling asserted that the coronavirus is a physical threat — a web of microscopic particles that comes to rest on surfaces, rendering the property unusable, Bloomberg said in its report.

Houghtaling and other advocates lobbied public officials in New York City, among others, to include phrases such as “physical loss” and “physical damage” in shutdown orders requiring businesses to close.

“If you ask them, ‘Is contamination physical?’ they start getting into arcane things like cat piss,” he told the newspaper. “Do you need to? Something that is small, that can go through the air and contaminate and get into your nose and get you very sick or kill your mother and father … it’s physical.”

Since March, Houghtaling has challenged three major companies in court and created a lobbying coalition called the Business Interruption Group, which is urging lawmakers in Congress to pass a bill requiring insurers to pay certain virus-related claims.

Meanwhile, the Oceana Grill case is scheduled to go to trial on Nov. 16 — set to become one of the first major tests of COVID insurance law.


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