Case: 1:20-cv-02160 Document #: 52 Filed: 01/10/21 Page 1 of 5 PageID #:1533
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`IN THE UNITED STATES D ISTR IC T COURT
`FOR THE NORTHERN D IS TR IC T OF ILLINO IS
`EASTERN D IV IS ION
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`SANDY PO IN T DENTAL, PC ,
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`Plaintiff,
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`THE C INC INNATI INSUR ANC E
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`COMPANY,
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`Defendant.
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`Case No. 20 CV 2160
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`Judge Robert W. Gettleman
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`MEMORANDUM OPINION & ORDER
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`Plaintiff Sandy Point Dental, PC brought a three count complaint against defendant, The
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`Cincinnati Insurance Company, seeking a declaration that defendant must provide coverage
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`under the policy for losses due to governmental closure orders intended to slow the spread of the
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`Coronavirus and COVID-19, damages and attorneys’ fees under 215 ILCS 5/155, and a claim for
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`breach of contract for failing to provide coverage. On September 21, 20, the court granted
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`defendant’s motion to dismiss and terminated the case. [Doc. 37]. Plaintiff has filed a motion
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`for leave to file a Second Amended Complaint [Doc. 39] and a motion to reconsider [Doc. 40].
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`After reviewing the briefs and considering the supplemental authority, the court denies both
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`motions.
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`BACKGROUND
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`The background facts are set forth in the court’s earlier opinion and need not be restated
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`here. Sandy Point Dental, PC v Cincinnati Insurance Co., 2020 WL 5630465, at *1 (N.D. Ill.
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`Sep. 21, 2020). Relevant to the instant motions, defendant issued an insurance policy to plaintiff
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`for the period of October 14, 2017 to October 14, 2020. The relevant provisions can be found in
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`1
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`Case: 1:20-cv-02160 Document #: 52 Filed: 01/10/21 Page 2 of 5 PageID #:1534
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`the Building and Personal Property Coverage Form and the Business Income Coverage Form.
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`The Business Income Coverage states, in relevant part:
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`We will pay for the actual loss of “Business Income” … you sustain due to the
`necessary “suspension” of your “operation” during the “period of restoration”. The
`“suspension” must be caused by direct physical “loss’ to property at “premises”
`cause by or resulting from any Covered Cause of Loss.
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`[…]
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`We will pay for the actual loss of Business Income you sustain due to the necessary
`“suspension” of your “operations” during the “period of restoration”. The
`“suspension” must be caused by direct physical “loss” to property at “premises”
`which is described in the Declarations and for which a “Business Income” Limit of
`Insurance is shown in the Declaration. The “loss” must be caused by or result from
`a Covered Cause of Loss.
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`The policy defines a Covered Cause of Loss as “RISKS OF DIRECT PHYSCIAL LOSS,” unless
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`expressly excluded by the policy.
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`DISCUSSION
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`Plaintiff has filed two motions: one for leave to file a Second Amended Complaint and the
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`other for reconsideration under Rule 59(e). The court will discuss each in turn.
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`1) Motion to reconsider
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`The court’s September 21, 2020, opinion found that the insurance policy covering
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`plaintiff’s business is triggered only by a direct physical loss, and that the COVID-19 pandemic
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`and subsequent lockdown orders did not cause such a loss. [Doc. 37]. The court further found
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`that the lockdown orders did not trigger civil authority coverage, and that plaintiff failed to plead
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`a 215 ILCS 5/155 claim. Plaintiff moves to reconsider only the court’s first finding: that there
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`was no physical damage triggering insurance coverage.
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`Rule 59(e) of the Federal Rules of Civil Procedure “allow[s] a party to bring to the
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`district court’s attention a manifest error of law or fact so that it may correct, or at least address,
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`2
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`Case: 1:20-cv-02160 Document #: 52 Filed: 01/10/21 Page 3 of 5 PageID #:1535
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`the error in the first instance.” A&C Constr. & Installation, Co. WLL v. Zurich Am. Ins. Co., 963
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`F.3d 705, 709 (7th Cir. 2020). Such a motion serves a limited function and may not be used to
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`reargue or rehash arguments previously presented. See Oto v. Metro. Life. Ins. Co., 224 F3d
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`601, 606 (7th Cir. 2000). The party seeking the Court’s reconsideration must give the Court “a
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`reason for changing its mind.” Ahmed v. Ashcroft, 388 F.3d 247, 249 (7th Cir. 2004).
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`Plaintiff argues that the court should reconsider its decision because there as been “a
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`change in the law after the case was submitted to the Court for consideration.” The only change
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`plaintiff identifies is a single case from the United States District Court for the Western District
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`of Missouri, Blue Springs Dental Care, LLC v. Owner Ins. Co., 2020 WL 5637963 (W.D. Mo.
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`Sep. 21, 2020). The court in Blue Springs found that the COVID-19 virus physically attached
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`itself to the premises, causing physical damage or loss to the property, and thus triggered
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`insurance coverage. Id. at *4. Plaintiff argues that the Blue Springs case is particularly relevant
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`because the plaintiff in Blue Springs is a dental office, just like the plaintiff here.
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`Contrary to plaintiff’s arguments, Blue Springs is nothing new. Indeed, the reasoning of
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`Blue Springs is nearly identically to the reasoning in Studio 417, Inc., et al. v. the Cincinnati Ins.
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`Co., 2020 WL 4692385 (W.D. Mo. Aug. 12, 2020). Both cases were issued by the same judge
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`and focus on policy language that this court has already distinguished. The relevant policy
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`language in both Studio 417 and in Blue Springs provided that the insurer “will pay for direct
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`physical loss of or damage to Covered Property.” Studio 417, 2020 WL 4692385, at *4-5; Blue
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`Springs, 2020 WL 5637963, at *4. The Western District of Missouri court focused heavily on the
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`disjunctive “or” and found that the policy contemplated loss to property other than direct
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`physical damage. Id. This court expressly distinguished the policy language and reasoning of
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`Studio 417 in its earlier opinion, concluding that the policy language in Studio 417 was much
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`3
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`more expansive than the policy language here (providing for “direct physical ‘loss’ to property”).
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`A second case with the same distinguishable policy language hardly amounts to a “change in the
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`law” warranting reconsideration.
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`Further, the majority of courts to address this issue have agreed with this court, finding
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`that COVID-19 and corresponding closure orders do not cause physical damage or physical loss
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`to insured property. An Illinois state court and several federal courts have cited this court’s
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`earlier decision favorably and have agreed with this court’s conclusion. See for example, It’s
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`Nice Inc. v. State Farm Fire and Cas., Co., Case No. 2020 L 000517 (18th Judicial Circuit
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`(DuPage County) Sep. 29, 2020) (favorably citing Sandy Point and relying on that reasoning to
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`conclude that COVID-19 does not cause physical damage triggering insurance coverage, and
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`dismissing the case); Bradley Hotel Corp. v. Aspen Specialty Ins. Co., 2020 WL 7889047, at *3-
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`4 (N.D. Ill. Dec. 22, 2020) (same); T & E Chi. LLC v. Cincinnati Ins. Co., 2020 WL 6801845, a
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`*4 (N.D. Ill. Nov. 19, 2020) (same); Uncork and Create LLC v. Cincinnati Ins. Co., 2020 WL
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`6436948, at *4-5 (S.D. W. Va. Nov. 2, 2020) (same); Raymond H Nahmad DDS PA v. Hartford
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`Cas. Ins. Co., 2020 WL 6392841, at *5 (S.D. Fl. Nov. 2, 2020) (same).
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`Plaintiff has not provided a manifest error of fact or law. All plaintiff has provided is an
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`out-of-circuit case that relies on a different state’s law and different policy language. Plaintiff’s
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`arguments do not warrant a motion to reconsider. The motion is accordingly denied.
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`2) Leave to File a Second Amended Complaint
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`Plaintiff has additionally moved for leave to file a Second Amended Complaint.1
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`Ordinarily, a plaintiff whose complaint has been dismissed under Rule 12(b)(6) may be given an
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`opportunity to amend the complaint before the entire action is dismissed. Runnion v. Girl Scouts
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`1 Plaintiff has already amended its complaint once as a matter of course [Doc. 23].
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`4
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`Case: 1:20-cv-02160 Document #: 52 Filed: 01/10/21 Page 5 of 5 PageID #:1537
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`of Greater Chi., 786 F.3d 510, 519 (7th Cir. 2015). Under Rule 15(a)(2), “[t]he court should
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`freely give leave [to amend] when justice so requires.” Fed. R. Civ. P. 15(a)(2). “The terms of
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`the rule, however, do not mandate that leave be granted in every case.” Park v. City of Chi., 297
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`F.3d 606, 612 (7th Cir. 2002). The Seventh Circuit has recognized that, “when it is clear that the
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`defect cannot be corrected so that amendment is futile, it might do no harm to deny leave to
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`amend and enter an immediate final judgment.” Runnion, 786 F.3d at 520. Such is the case here.
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` Plaintiff’s proposed Second Amended Complaint contains eight new paragraphs that
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`essentially state that the COVID-19 virus spreads through particles that land on surfaces and
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`physically attaches itself to physical premises. However, these new allegations do not correct the
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`deficiencies in plaintiff’s original complaint. There are no allegations that COVID-19 was ever
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`present in the facility and no allegations of tangible physical damage. Even if plaintiff could
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`plead the presence of the COVID-19 virus on the premises, that allegation alone is not sufficient
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`to present a claim based on direct physical damage to the property. As the court held in its earlier
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`order, “[t]he coronavirus does not physical alter the appearance, shape, color, structure, or other
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`material dimension of the property.” Sandy Point, 2020 WL 5630465, at *3. The Second
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`Amended Complaint does not change this fact and does not cure this defect. Because leave to
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`amend is futile, plaintiff’s motion for leave to amend is denied.
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`CONCLUSION
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`For the reasons stated above, the court denies plaintiff’s motion for leave to file a Second
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`Amended Complaint [Doc. 39] and motion to reconsider [Doc. 40].
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`ENTER:
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`Date: January 10, 2021
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`___________________________________
`Robert W. Gettleman
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`United States District Judge
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`5
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