After the fire, Zurich issued two checks totaling over $1.2 million to Red Lobster. However, RL New Brunswick claims that because it was not named on the checks, Red Lobster deposited the funds into its bank account and mixed them with its other assets.
Red Lobster Sues Zurich : Bankruptcy Complications
In May, Red Lobster filed for Chapter 11 bankruptcy protection, converting all its assets, including the insurance funds, into part of the bankrupt estate. As a result, RL New Brunswick argues that the $1.2 million intended for repairs is no longer accessible.
“Had Zurich abided by the terms of the policy, our client’s interests would have been protected,” said RL New Brunswick’s attorney, Robert T. Trautmann. The property owner is seeking compensatory and consequential damages, claiming Zurich’s actions violated the insurance agreement and caused financial harm.
Legal Representation and Next Steps
RL New Brunswick is represented by Robert T. Trautmann of Lerner Arnold & Winston LLP, while Zurich is represented by Philip C. Silverberg and Craig R. Rygiel of Mound Cotton Wollan & Greengrass LLP. Zurich declined to comment on the case.
