The company operates big-name theaters and is suing two insurers for the size of the payments.
Jujamcyn Theaters, operator of the homes of top shows such as “The Book of Mormon”, “Moulin Rouge: The Musical,” “Hadestown”, and “Mean Girls,” is suing its insurance companies.
The insurers named in the lawsuit include the Pacific Indemnity Company and the Federal Insurance Company.
According to the Jujamcyn Theaters filing, the insurance companies paid only $250,000 for covering what it alleges should be “tens of millions of dollars” in losses associated with the pandemic crisis.
The company filed the lawsuit with the Southern District of New York. It claims that Federal Insurance Company “flatly denied coverage, refusing to pay even a penny to help Jujamcyn.” On the other hand, it stated that Pacific Indemnity paid the Broadway theater company $250,000 of what it alleges should have been considerably more under its policy terms.
Jujamcyn Theaters is accusing the insurers of knowing and publicly acknowledging their obligation to pay.
“Federal and Pacific knew, and publicly acknowledged, that they could be obligated to pay for massive losses in the event of a pandemic. Federal and Pacific also knew that they could use common and widely available exclusions to guard against being obligated to pay for pandemic-associated losses,” said the lawsuit filing. “However, they decided not to do so here, selling Jujamcyn the all-risks Federal Policy and all-risks Pacific Policy and deliberately omitting from the policies any potentially applicable exclusion associated with a virus-related pandemic.”
Broadway’s stages shut down on March 12 in response to an executive order by Governor Andrew Cuomo, when gatherings of 500 or more people were banned.
The week before, Jujamcyn Theaters had hosted over 48,000 audience members from around the world. It submitted its business income loss claim to Federal Insurance Company, notifying the insurer of a minimum of 7 positive COVID-19 tests from individuals under its employ. However, the insurer denied coverage on the grounds that there hadn’t been any “direct loss or damage” that would typically trigger a policy’s payment. It underscored that Cuomo’s orders didn’t prohibit access to the Broadway theaters, which meant that the employees could still enter and check on the buildings.