In a precedent-setting case, classic San Francisco restaurant John’s Grill announced on December 16 that it reached a settlement with its insurance provider Sentinel Insurance Company over the company’s decision to deny coverage for business interruptions during the pandemic. The triumph represents a rare win for restaurants making similar cases across the country; owner John Konstin filed this case with firm Cotchett, Pitre & McCarthy in April 2020, meaning it's taken more than two-and-a-half years to secure any financial relief.
It’s an important victory for an industry struggling to get back on its feet after numerous devastating blows dealt by the pandemic. The federal government has largely sided with insurance companies when it comes to who’s responsible for businesses’ financial losses due to COVID; the Ohio Supreme Court just ruled that insurers are not responsible for money a business lost due to pandemic-related closures. Konstin only sought legal support when his claims early on in the pandemic were denied, an issue faced by scores of restaurant owners throughout these last few years. The details of the settlement are confidential, but Joe Cotchett, the attorney who represented John’s Grill, told the San Francisco Chronicle the settlement was “substantial.”
Laurie Thomas, executive director of the Golden Gate Restaurant Association, told the paper she’s not aware of any other West Coast (or East Coast for that matter) victories for small businesses looking to recoup money lost due to COVID-induced closures from their insurance companies. Brian Danitz, a partner at Cotchett, Pitre & McCarthy, said in a statement that it’s “an outrage how big insurance companies spent years collecting huge insurance premiums from small businesses like John’s Grill that are the fabric of this country and then refused to pay out claims when the pandemic hit.”