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Law360 (May 28, 2020, 1:25 PM EDT ) U.S. Specialty Insurance Co. is asking a Texas federal court to declare an advisory firm can't ask for additional coverage beyond its $150 million limit over events canceled in the wake of the COVID-19 pandemic, saying there's nothing in the policy entitling the firm to seek more money.
In a complaint filed Wednesday, USSI said Gartner Group Inc., a research and advisory company that organizes and stages events and conferences throughout the world, has had to cancel or postpone 50 of its 64 shows scheduled for 2020 and requested additional coverage from USSI for its losses.
The $150 million is the total aggregate limit for the year, however, and USSI is not obligated to go beyond that, the insurer told the court.
According to the complaint, while in previous years Gartner had sought coverage for the full cost of all its events, over the last decade it had purchased less extensive coverage in anticipation that it would not see a total loss.
While that judgment was accurate until now, COVID-19 and the social distancing measures put in place to counter its spread have forced the company to cancel or postpone far more events than anticipated, with losses expected to exceed $400 million, according to the complaint.
USSI has honored its obligations up to the $150 million limit, the insurer told the court, and has accepted claims that could exceed that limit, pending a full coverage review once it receives documentation from Gartner, but nothing in the policy entitles Gartner to increase the limit.
In addition, the insurer told the court, the policy does not allow Gartner to secure additional coverage if it is aware of the circumstances that would lead to a claim — as Gartner is aware of COVID-19 and the canceled or postponed events, it cannot now seek coverage for them.
Representatives for USSI and Gartner could not immediately be reached for comment Thursday.
USSI is represented by Gerard G. Pecht, Sumera Khan, and Daniel McNeel Lane Jr. of Norton Rose Fulbright US LLP.
Counsel information for Gartner was not available Thursday.
The case is U.S. Specialty Insurance Co. v. Gartner Group Inc., case number 4:20-cv-01850, in the U.S. District Court for the Southern District of Texas.
--Editing by Alyssa Miller.
For a reprint of this article, please contact reprints@law360.com.
