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Law360 (January 19, 2021, 8:37 PM EST ) An Illinois federal court threw out another dental clinic's bid for COVID-19 coverage from Cincinnati Insurance Co. on Tuesday, holding that the clinic failed to demonstrate a covered loss since essential dental services were allowed during pandemic shutdowns.
U.S. District Judge Philip G. Reinhard granted Cincinnati's effort to toss the case, finding that Riverside Dental of Rockford Ltd. could not show it lost access to its property due to state-mandated closures issued in March.
Although its access to the covered property was "limited" due to government-shutdown orders, Judge Reinhard stressed that Riverside never lost access to the office as it claimed, relying on the state's first such decision in the case of Sandy Point Dental v. Cincinnati Insurance Co. from last week.
"While coronavirus orders have limited plaintiff's operations, no order issued in Illinois prohibits access to plaintiff's premises," the judge said in the order. However, he gave the clinic until mid-February to amend its complaint.
Riverside has argued that Cincinnati is obligated to cover its loss under the policy's civil authority provision and that the carrier breached the insurance contract when it denied coverage. The clinic has contended that only emergency dental procedures were considered essential by the government orders, and since 90% of the clinic's work is routine or elective dental procedures, the orders effectively shut the clinic down.
"Plaintiff alleges approximately 90% of its business was 'non-essential' which means approximately 10% of its business was not required to be cancelled or postponed," Judge Reinhard said. Because the government allowed individuals to go to the clinic for essential services, the dental office never lost access to its property, he said.
Last week, U.S. District Judge Robert Gettleman rejected Sandy Point Dental PC's bid to give it another chance to convince him that Cincinnati should cover its COVID-19 shutdown-related losses, saying an amended complaint would not cure problems with the suit.
Judge Gettleman maintained the legal soundness of an earlier finding that Sandy Point hadn't suffered a physical loss, holding that the clinic couldn't cure pleading deficiencies in its complaint.
Sandy Point had urged Judge Gettleman to reconsider dismissing its lawsuit after a Missouri federal judge found the COVID-19 virus causes physical loss or damage after physically attaching itself to property. The clinic argued that it shouldn't be forced to show the novel coronavirus was present on its properties. But the judge said Cincinnati's policy plainly stated "demonstrable, physical alteration to the property" is required to trigger coverage, and that the dental office failed to show that.
Representatives for the parties could not be immediately reached for comment Tuesday.
Riverside is represented by Erik Edwin Carlson I of Brassfield Krueger & Ramlow Ltd.
Cincinnati is represented by Brian M. Reid of Litchfield Cavo.
The case is Riverside Dental of Rockford Ltd. v. Cincinnati Insurance Co., case number 3:20-cv-50284, in the U.S. District for the Northern District of Illinois.
--Additional reporting by Lauraann Wood. Editing by Ellen Johnson.
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