Denny’s Children’s Wear, Ta-boo restaurant sue insurers for denying claims

Both Palm Beach County businesses allege breach of contract by their insurance companies

TRD MIAMI /
Jul.July 21, 2020 10:30 AM
Ta-boo and Denny’s Children Wear (Credit: Google Maps)

Ta-boo and Denny’s Children Wear (Credit: Google Maps)

Retailers and restaurants are losing money hand over fist during the pandemic, but insurance companies are still refusing to pay business interruption insurance claims, according to a series of recently filed lawsuits.

Last week, children’s clothing retailer Denny’s and the popular Palm Beach bar & restaurant Ta-boo filed suit against their insurers, International Catastrophe Insurance Managers and Lloyd’s of London, respectively, for denying their claims. Both suits were filed in federal court in the Southern District of Florida.

Such lawsuits are becoming increasingly common in Florida as Covid-19 cases skyrocket and counties eye tighter restrictions on businesses and restaurants.

“The economic realities are setting in,” said Steve Marks, an attorney with Podhurst Orseck, who represents the plaintiffs. “This is only going to get worse before it gets better.”

According to Denny’s suit, the retailer entered into an agreement on Sept. 16, 2019, in which the insurer agreed to make payments for business losses. Due to coronavirus, the retailer had to close and lay off its entire staff at its Boca Raton location. The lawsuit claims it was denied its business insurance claim by its insurer in April. It is seeking declaratory judgment, alleging the insurer breached its contract.

Ta-boo is making a similar allegation. The restaurant on Worth Avenue in Palm Beach claims it was previously open seven days a week from 11:30 a.m. through 11:00 p.m. and had the capacity to hold about 200 guests inside. The restaurant does not have any open air or outside capacity, according to the complaint. It shut down on March 20 and did not reopen until May 22. During that time, Ta-boo was forced to lay off about 50 employees, according to the suit. Ta-boo alleges its insurer denied its claim in June. The lawsuit alleges breach of contract and seeks declaratory judgment.

International Catastrophe Insurance Managers and Lloyd’s of London did not immediately return requests for comment.

Filings of business interruption lawsuits started shortly after coronavirus-related restrictions began in March. In April, IT! Italy Ristorante Café & Bar at 500 East Las Olas Boulevard in downtown Fort Lauderdale sued Chubb Limited, the largest commercial property insurer in the country, alleging it failed to honor its agreement to pay its business insurance claim tied to losses stemming from the pandemic.

In April, Atma Beauty, at 1874 West Avenue in Miami Beach, filed a lawsuit against HDI Global Specialty SE, Axis Specialty Europe SE and Underwriters at Lloyd’s of London. The complaint alleges Lloyd’s of London promised to cover losses and expenses incurred as a result of the salon suspending its operations, but failed to do so, breaching its contract. The salon paid a higher premium to be covered by an all-risk policy, and a pandemic was not excluded from the coverage, according to the suit.


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