FILED: NEW YORK COUNTY CLERK 08/07/2020 02:43 PM
`NYSCEF DOC. NO. 1
`
`INDEX NO. 653674/2020
`
`RECEIVED NYSCEF: 08/07/2020
`
`SUPREME COURT OF THESTATE OF NEW YORK
`COUNTY OF NEW YORK
`
`X
`RHYTHM OFLrE CORP DB/A BROADWAY DANCE
`and BROADヽ VAY DANCEヽ VEST 65・lLLC
`
`Pl江■1■
`
`‐aganst‐
`
`THE HARTFORD FINANCIAL SERVICES GROUPINC.
`and SENTINELINSURANCE COMPANY LTD,
`
`TO TⅡE ABOVE NAMED DEFENDANTS:
`
`I)efendant.
`
`X
`
`Indcx No.:
`Datc Purchascd
`SUMMONS
`
`Phnird∝ign江∝ NEW
`YORK County“ ■e phce of
`tnal.
`
`The basis ofvenue is:
`CPLR s03(a) and s03(d)
`Plaintiff residence and
`substantial part events or
`omissions occurring in County
`
`YOU ARE ⅡEREBY SUpD燿ONEDゎ alswer he comメ 劉m inぬis“■oL and o sewea
`,鴫 if the∞ mphnt is not鯵Ⅳed M血 面 s summons,to∝Ⅳc a notice of
`∞
`ap"arance on he PH■ 1■も'atomeys wiintwcnty days an∝ ■e seⅣ i∝ 。fhissummons,excI“ ive
`"Of your answα
`Of the day Of Sel● ∝ ,Where SerVi∝ iS mdeけ dCliVCry upOn yOuド lSOndly"thm血 e SttC,Or,
`Ⅲ■h30 days ancr compl“ on of servi∝ whec servi∝ is mde m myom∝ mmnen ln case of
`yorねiluF b ap"″ Or answer,judgnentmllbctakcnagainstyoubydeiultbrthediefdemand“
`in thc conlplaint.
`
`Dtted:Long lsland Ci″ ,New York
`August 7,2020
`
`Raldol
`
`ON,P.C
`
`59 Maidcn Lane,6■ Floor
`New Yort New York 10038
`(212)566‐ 7500
`
`TO:
`THE HARTFORD FINANCIAL SERVICES GROUPINC
`I Hartおd Plaza
`Hartbrd,CT 06155
`
`SENTINEL INSURANCE COMPANY LTD
`l HanfOrd Plaza,
`Hanford,CT 06105
`
`1 of 18
`
`

`

`FILED: NEW YORK COUNTY CLERK 08/07/2020 02:43 PM
`NYSCEF DOC. NO. 1
`
`INDEX NO. 653674/2020
`
`RECEIVED NYSCEF: 08/07/2020
`
`SUPREME COURT OF THE STATE OF NEW YORK
`COUNTY OF NEW YORK
`
`X
`RHYTHM OF LIFE CORP D涯〕/A BROADWAY DANCE
`and BROADWAY DANCE WEST 65TH LLC
`
`Plaini二
`
`-ag nst-
`
`THE HARTFORD FINANCIAL SERVICES GROLP INC
`andSENTNELINSURANCE COMPANY LTD,
`
`X
`
`VERIF】ED
`COMPLAINT FOR
`DECLARATORY RELIEF
`
`Plaintifis, RHYTHM:OF LIFE CORP D/B/A BROADWAY DANCE.and BROADWAY
`
`DANCEヽ VEST 65TH LLC(hereinaner,“ Plaintifも ''),bing this Complaint alleging rclief against
`
`Deindants,HARTFORD FINANCIAL SERVICES GROUP INC.(Hartford)and SENTINEL
`
`INSURANCE COIMPANY LTD(Scntincl),and dlege as follows:
`
`I. NATURE OF TIIE CASE
`
`I .
`
`This is a civil action seeking declaratory relief arising from Plaintiff RIIYTHM
`
`OF LIFE CORP D/B/A BROADWAY DANCE's contract of insurance with the Defendants.
`
`2. This is a civil action seeking declaratory relief arising llom Plaintiff
`
`BROADWAY DANCE WEST 65rH LLC's contract of insurance with the Defendants.
`
`3.
`
`There is a nexus between the two Plaintiffs entities in that they are dance studios
`
`operated by the same person Diane King, CEO.
`
`4.
`
`In light of the Coronavirus global pandemic C'COVID-I9") and state and local
`
`orders ("Civil Authority Orders") mandating that all non-essential in store trusinesses such as
`
`Plaintiffs' cease or restrict operations, Plaintiffs have sustained significaat business losses.
`
`5.
`
`Plaintiffs' insurance policies are All Risk Policies and provide coverage for all non-
`
`excluded business losses, and thus provides coverage here.
`
`6.
`
`As a result, Plaintiffs are entitled to declaratory reliefthat Plaintiffs are covered for
`
`2 of 18
`
`

`

`FILED: NEW YORK COUNTY CLERK 08/07/2020 02:43 PM
`NYSCEF DOC. NO. 1
`
`INDEX NO. 653674/2020
`
`RECEIVED NYSCEF: 08/07/2020
`
`all business losses that have been incurred in a sum which exceeds the j urisdictional limitations of
`
`all lower Courts which would otherwise have jurisdiction over this action.
`
`I
`
`JURISDICTION
`
`7.
`
`This action for a declaratory judgment is within this Court's general original
`
`jurisdiction and not within the jurisdiction ofany court of limited jurisdiction ofthis state.
`
`8.
`
`This Court has personal jurisdiction over the Defendants because the Defendants
`
`have transacted, solicited and conducted business in New York through their employees, agents,
`
`affiliates and/or sales representatives and has derived substantial revenue from such business in
`
`New York. Defendants are licensed to do business in New York State and has purposely availed
`
`itself of personal jurisdiction in New York because it contracted to provide insurance to Plaintiffs
`
`in New York which is the subject of this case.
`
`9.
`
`This Court has personal jurisdiction as defendants were authorized by the New
`
`York department of Financial Services to issues policies of insurance within the State of New York
`
`including Plaintiffs policies.
`
`10. This Court has personal jurisdiction ofover defendants pursuant to CPLR $302.
`11. This Court has personal jurisdiction of over defendants pursuant to CPLR
`
`$302(a)(1) in that defendants transacted business within the state and supplied good and services
`
`within New York State.
`
`12. Venue is proper in New York County pursuant to CPLR $503 because Plaintiffs'
`
`reside and are located in this county and because a substanfial part of the events or omissions
`
`giving rise to this claim occuned in New York County
`
`PARTIES
`
`′T
`
`hcrc is a nexus bet、veen the t、 vo lPlaintfF cndtlcs in that they are dance practiccs
`
`13.
`
`olχ rated by the saine olp〕 ratoriDiane iKing,CEO.
`
`14. At all relcvalt times,Plainiir RHYTHM OF LIFE CORP D/B/A BROADWAY
`
`3 of 18
`
`

`

`FILED: NEW YORK COUNTY CLERK 08/07/2020 02:43 PM
`NYSCEF DOC. NO. 1
`
`INDEX NO. 653674/2020
`
`RECEIVED NYSCEF: 08/07/2020
`
`DANCE is a corporation authorized to do business and doing business in the State ofNew York,
`
`County ofNew York.
`
`15. Plaintiff RHYTI{M OF LIFE CORP D,ts/A BROADWAY DANCE operates a
`
`dance studio whose revenue depends substantially upon the ability of customers to visit that
`
`facility.
`
`16. At all relevant times, Plaintiff BROADWAY DANCE WEST 65rlr LLC is a
`
`corporation authorized to do business and doing business in the State of New York, County of
`
`New York.
`
`l7 . Plaintiff BROADWAY DANCE WEST 65rH LLC. operates a dance studio whose
`
`revenue depends substantially upon the ability of customers to visit that facility.
`
`18. Defendant TI{E HARTFORD FINANCTAL SERVICES GROUP. INC.
`
`("Hartford") is a Delaware Corporation with its principal place of business in Hartford
`
`Connecticut. Hartford operated in this County at all relevant times, including through its
`
`subsidiary, defendant SENTINEL INSURANCE COMPANY Lm.
`
`19. At all relevant times, Defendant SENTINEL INSURANCE COMPANY LTD
`
`("Sentinel") is a corporation doing business in the County of Hartford, State of Connecticut, and
`
`provides business intemrption coverage to its insureds, including the Plaintiffs.
`
`20. Defendant SENTINEL INSURANCE COMPANY LTD issued an All Risk
`
`Insurance Policy to the Plaintiff RHYTHM OF LIFE CORP D/B/A BROADWAY DANCE
`
`(Policy Number 13 SBA TI9538 SB) for the period of June 23,2019, to June 23, 2020. See.
`
`Policy, attached as Exhibit A.
`
`21. The policy includes All Risk coverage which incorporates business intemrption
`
`coverage for, among other things, business personal property and income protection and extra
`
`expense.
`
`22. Defendant SENTINEL INSURANCE COMPANY LTD issued an All Risk
`
`4 of 18
`
`

`

`FILED: NEW YORK COUNTY CLERK 08/07/2020 02:43 PM
`NYSCEF DOC. NO. 1
`
`INDEX NO. 653674/2020
`
`RECEIVED NYSCEF: 08/07/2020
`
`Insurance Policy to the Plaintiff BROADWAY DANCE WEST 65rH LLC (Policy Number 13
`
`SBA 109963 SB) for the period of August 1,2019 to August l, 2020. See, Policy, attached as
`
`Exhibit B.
`
`23. The policies include Special all risk coverage which incorporates business
`
`interruption coverage for, among other things, business personal property and income protection
`
`& extra expense.
`
`24. Plaintiffs have paid the policy premiums to Sentinel specifically to provide
`
`coverages of lost business income and extra expenses in the event o[ an involuntary business
`
`interruption.
`
`25. Plaintiffs submitted insurance claims arising out ofbusiness losses sustained due to
`
`the New York Civil Authority Orders issued as a result of the risk human and property loss from
`
`COVID-I9. On or about June 5, 2020 and August 4,2020, Defendants denied Plaintiffs' claim
`
`and asserted that Plaintiffs were not entitled to coverage for loss of income. See, Denial Letter,
`
`attached hereto as Exhibit C and f,xhibit D.
`
`III. FACTUAL BA CKGROUND
`
`A.
`
`Insurance Coveraqe
`
`26. On or about June 23, 2019 and August 1, 2019 respectively, Defendants entered
`
`into a contract of insurance with the Plaintiffs RHYTHM OF LIFE CORP D/B/A BROADWAY
`
`DANCE. and BROADWAY DANCE WEST 65rH LLC specifically to provide, among other
`
`things, business income coverage in the event ofbusiness intemrption or closures by order of Civil
`
`Authority, and for business losses as a result of property damage at its various locations in New
`
`York County, State ofNew York (the "Covered Properties").
`
`27. The Covered Properties consist of, among other locations:
`
`RHYTHM OF LIFE D,ts/A BROADWAY DANCE 322 West 45s Street, Floor 3, New
`York, NY 10036.
`
`5 of 18
`
`

`

`FILED: NEW YORK COUNTY CLERK 08/07/2020 02:43 PM
`NYSCEF DOC. NO. 1
`
`INDEX NO. 653674/2020
`
`RECEIVED NYSCEF: 08/07/2020
`
`BROADWAY DANCE WEST 65T1I LLC 37 West 678 Street, New York, NY 10023
`28. The Covered Properties are covered under a Special All Risk Business Insurance
`
`Policy to the Plaintiffs issued by the Defendants to Plaintiff RHyTIIM OF LIFE CORP D,ts/A
`
`BROADWAY DANCE and to Plaintiff BRoADWAY DANCE WEST 65TH LLC.
`29. The RHYTHM OF LIFE CORP D/B/A BROADWAY DANCE policy provides
`
`among other things coverage for property, business personal property, income protection & extra
`
`expense, and additional coverages between the period ofJune 23, 2019 to June23,2020.
`30. The BROADWAY DANCE WEST 65rH LLC policy provides, among other things
`
`coverage for property, business personal property, income protection & extra expense, and
`
`additional coverages between the period ofAugust 1, 2019 to August 1, 2020.
`
`31. Plaintiffs RHYTHM OF LIFE CORP D/B/A BROADWAY DANCE. and
`
`BROADWAY DANCE WEST 65rH LLC faithfully paid policy premiums to Defendants,
`
`specifically to provide, among other things, coverage for the loss of business income and extra
`
`expense sustained in the event ofbusiness interruption or closures by order of Civil Authority.
`
`32. Under the Policy, insurance is extended to apply to the actual loss of business
`
`income sustained and the actual, necessary and rsrsonable extra expenses incurred when access to
`
`the Covered Properties is specifically prohibited by order ofcivil authority as the direct result ofa
`
`covered cause of loss to prop€rty in the immediate area of Plaintiffs' Covered Properties. This
`
`additional coverage is identified as coverage under "Civil Authority."
`
`33. Each aforesaid Policy is an all-risk policy, insofar as it provides that covered causes
`
`of loss under the policy means direct physical loss or direct physical damage unless the loss is
`
`specifically excluded or limited in the Policy.
`
`34. Based on information and belief, the Defendants accepted the policy premiums with
`
`no intention of providing coverage for business income losses resulting from orders of a Civil
`
`Authority that the Covered Properties be shut down or restricted, or any related losses and/or
`
`6 of 18
`
`

`

`FILED: NEW YORK COUNTY CLERK 08/07/2020 02:43 PM
`NYSCEF DOC. NO. 1
`
`INDEX NO. 653674/2020
`
`RECEIVED NYSCEF: 08/07/2020
`
`damages.
`
`35. Defendant's denial of coverage is based on its claim that the Covered Properties
`
`did not sustain direct physical loss or damage. &e Denial Letter, attached hereto as Exhibit C.
`
`36. However, Defendant's narrow reading of "loss" renders the Civil Authority
`
`coverage ineffectual and demonstrates Defendants had no intention of providing coverage for
`
`losses Plaintiffs faithfully paid premiums to insure against.
`
`B.
`
`The Coronavirus Pandemic
`
`37. The scientific community, and those personally affected by the virus, recognize the
`
`Coronavirus as a cause of real physical loss and damage. It is clear that conlamination of the
`
`Covered Property would be a direct physical loss requiring remediation to clean the surfaces of
`
`the salon.
`
`38. The virus that causes COVID-l9 remains stable and transmittable in aerosols for
`
`up to thee hours, up to four hours on copper, up to 24 hours on cardboard and up to two to three
`
`days on plastic and stainless steel. See. httns : //www nih sov/news -events/news-releases/new-
`
`coronavirus-stable-hours-surfaces.
`
`39. The CDC has issued a guidance that gatherings ofmore than 10 people must not
`
`occur. People in congregate environments, which are places where people live, eat, and sleep in
`
`close proximity, face increased danger of contracting COVID- 19.
`
`40. The global Coronavirus pandemic is exacerbated by the fact that the deadly virus
`
`physically infects and stays on surfaces of objects or materials, "fomites," for up to twenty-eight
`
`(28) days.
`
`41. China, Italy, France, and Spain have implemented the cleaning and fumigating of
`
`public areas prior to allowing them to re-open publicly due to the intrusion of microbials.
`
`42. COVID- 19 is a virus.
`43. COVID-19 is a physical substance.
`
`7 of 18
`
`

`

`FILED: NEW YORK COUNTY CLERK 08/07/2020 02:43 PM
`NYSCEF DOC. NO. 1
`
`INDEX NO. 653674/2020
`
`RECEIVED NYSCEF: 08/07/2020
`
`44. COVID- 19 is a human pathogen,
`45. COVID-19 can be present outside the human body in viral fluid particles.
`46. COVID-l9 can and does live on and/or remains capable of being transmitted and
`active on inert physical surfaces.
`47. COVID-l9 can and does live on and/or remains capable ofbeing transmitted and
`
`active on floors, walls, furniture, desks, tables, chairs, equipment and other items of property for a
`
`period of time.
`
`48. COVID-19 can be tansmitted by way of human contact with surfaces and items of
`
`physical property on which COVID-19 particles are physically present.
`49. COVID-19 has been transmiued by way of human contact with surlaces and items
`
`olphysical property located at premises in New York County.
`
`50. COVID-19 can be transmitted by human to human contact and interaction at
`
`premises in New York County, include places such as the business entities herein.
`
`51. COVID-I9 has been transmitted by human to human contact and interaction at
`
`premises in New York County.
`
`52. COVID-I9 can be transmitted through airbome viral particles emitted into the air
`
`at premises.
`
`53. COVID-l9 has been transmitted by way of human contact with airborne COVID-
`
`l9 particles emitted into the air at premises in New York County.
`
`54. The presence of any COVID-I9 pa(icles renders items ofphysical property unsafe.
`55. The presence of any COVID-I9 particles on physical property impairs its value,
`
`usefulness and/or normal function.
`
`56. The presence ofany COVID-I9 particles causes direct physical harm to property,
`57. The presence of COMD-19 particles causes direct physical loss to property.
`58. The presence ofCOVID-19 particles causes direct physical damage to property.
`
`8 of 18
`
`

`

`FILED: NEW YORK COUNTY CLERK 08/07/2020 02:43 PM
`NYSCEF DOC. NO. 1
`
`INDEX NO. 653674/2020
`
`RECEIVED NYSCEF: 08/07/2020
`
`59. The presence ofany COVID_I9 particles at premises renders the premises unsafe,
`thereby impairing the premises, value, usefulness andlor normal function.
`60. The presence of people infected with or carrying COVID-I9 particles renders
`physical property in their vicinity unsafe and unusable, resulting in direct physical loss to that
`
`property.
`
`6l
`
`The presence of people infected with or carrying COVID-19 particles at premises
`
`renders the premises, including property located at that premises, unsafe, resulting in direct
`
`physical loss to the premises and the property.
`
`62. State and local govemmental authorities, and public health officials around the
`
`Country acknowledge that COVID-l9 and the Pandemic cause direct physical loss and damage to
`
`property. For example,
`
`The City of New York issued an Emergency Executive Order in
`response to COVID-l9 and the Pandemic, in part, "because the virus
`physically is causing property loss and damage." (Emphasis added).
`
`The State of Colorado issued a Public Health Order that "COVID-
`19....physically contribute to property loss, contamination and
`damage." (Emphasis added).
`
`Broward County, Florida issued an Emergency Order acknowledging
`COVID-19 "is physically causing property damage." (Emphasis).
`The State of Washington issued a stay at home Proclamation stating that
`the "COVID-19 pandemic and its progression... remains a public
`disaster affecting life, health, [and] property... " (Emphasis added).
`
`The State of Indiana issued an Executive Order recogrizing that
`COVID-I9 has the propensity to physically impact surfaces and
`personal property." (Emphasis added).
`
`The City ofNew Orleans issued an order stating that "there is reason to
`believe that COVID-19 may spread amongst the population by various
`means of exposure, including the propensity to attach to surfaces for
`prolonged period oftime, thereby spreading from surface to person and
`causing property loss and damage in certain circumstances."
`(Emphasis added).
`
`The State of Illinois issued an Executive Order describing COVID-19's
`"propensity to physically impact surfaces and personal property."
`(Emphasis added).
`
`9 of 18
`
`

`

`FILED: NEW YORK COUNTY CLERK 08/07/2020 02:43 PM
`NYSCEF DOC. NO. 1
`
`INDEX NO. 653674/2020
`
`RECEIVED NYSCEF: 08/07/2020
`
`The State of New Mexico issued a Public Health Order acknowledging
`the "tkeaf' COVID-l9 "poses:' to ".property." (Emphasis added).
`
`North Carolina issued a statewide Executive Order in response to the
`Pandemic not only "to assure adequat€ protection for lives," but also to
`"assure adequate protection of... .property." (Emphasis added).
`
`The City of Los Angeles issued an Order in response to COVID-I9
`"because among other reasons, the COMD-l9 virus can spread easily
`from person to person and it is physically causing property loss or
`damage due to its tendency to attach to surfaces for prolonged periods
`of time." @mphasis added).
`C. Civil Authoritv
`
`63. In response to COVID-19 and the Pandemic the Govemor of New York has issued
`
`multiple executive orders pursuant to the authority vested by laws of New York.
`
`64 .
`
`In response to COVID- 1 9 and the pandemic, the New York State of Health pursuant
`
`to its authority under New York State Law has issued multiple orders including a Stay at Home
`
`Order.
`
`65 The State ofNew York is a civil authority as contemplated by the Policy.
`66. The New York State Deparhnent of Health is a civil authority as contemplated by
`
`the Policy.
`
`67. The Govemor of the State of New York is a civil authority as contemplated by the
`
`Policy.
`
`68. On March 7, 2020, New York Govemor Andrew Cuomo declared a Disaster
`
`Emergency for the entire state of New York as a result of COVID-I9.
`
`69. On March 12,2020, Govemor Cuomo set restrictions on large gatherings.
`70. On March 20, 2020, the State ofNew York issued a stay-at-home order that all non-
`
`essential workers must stay at home as a result of the COVID- 19 pandemic. To date, this order has
`
`was extended through June 13,2020 and thereafter.
`
`71. As of March 22,2020, Govemor Cuomo ordered all "non-essential businesses"
`
`10 of 18
`
`

`

`FILED: NEW YORK COUNTY CLERK 08/07/2020 02:43 PM
`NYSCEF DOC. NO. 1
`
`INDEX NO. 653674/2020
`
`RECEIVED NYSCEF: 08/07/2020
`
`statewide to be closed. This Order remained in full effect as ofon about June g, 2020. See, State,s
`
`Executive Order 202.6. The Govemor ordered that essential businesses can remain open subject
`
`to restriction. Essential businesses include hotels (infrastructure) and restaurants/bars (but
`only for take-ouVdelivery) Getail). Any dine-in or on-premise restaumnt or bar service, is
`
`specifically deemed non-essential.
`
`72. Further, on April 10,2020 President Trump seemed to support insurance coverage
`
`for business loss like that suffered bv the Plaintiff:
`
`REPORTER: Mr. President may I ask you about credit and debt as well.
`Many American individuals, families, have had to tap their credit cards
`during this period of time. And businesses have had to draw down their
`credit lines. Are you concemed Mr. President that that may hobble the U.S.
`economy, all ofthat debt number one? And number two, would you suggest
`to credit card companies to reduce their fees during this time?
`
`PRESIDENT TRIJMP: Well it's something that we've already suggested,
`we're talking to them. Business inlerruption insurance,l'd like to see these
`insurance companies-you know you have people that have paid. When I
`was in private I had busiRess interruption. When my business was
`interrupted through a hurricane or whatever it may be, I'd have business
`where I had it, I didn't always have it, sometimes I had it, sometimes, I had
`a lot of different companies. But iJ I had it I'd apect to be paid You have
`people. I speak nas y to the restauruteurs, where they have a restaurant,
`they've been paying for 25,30,.35 years, business intemrption. They've
`never needed it. All ofa sudden they need it. And I'm very good at reading
`language- I did very well in these subjects, OK. And I don't see the word
`pandemic mentioned. Now in some cases it is, it's an exclusion. But in a lot
`of cases I don't see it. I don't see it referenced. And they don't want to pay
`up. I would like to see the insurance companies pay ifthey need to pay, if
`it's fair. And they know what's fair, and I know what's fair, I can tell you
`very quickly. But business intemrption insurance, that's gefting a lot money
`to a lot of people. And they've been paying for years, sometimes they just
`started paying, but you have people that have never asked for business
`intemrption insurance, and they've been paying a lot of money for a lot of
`years for the privilege ofhaving it, and then when they finally need it, the
`insurance company says 'we're not going to give it.' We can't let that
`happen.
`
`S∝ ,h聾ュ4。1墓曇ユニM≦五αЦ胆 (emph“ iS“ded)
`
`73. The President is articulating a few core points
`
`Business intemrption is a common type of insurance
`
`11 of 18
`
`

`

`FILED: NEW YORK COUNTY CLERK 08/07/2020 02:43 PM
`NYSCEF DOC. NO. 1
`
`INDEX NO. 653674/2020
`
`RECEIVED NYSCEF: 08/07/2020
`
`. Businesses pay in premiums for this covenge and should reasonably
`expect they,ll receive the benefit of the coverage.
`. This pandemic should be covered unless there is a specific exclusion for
`
`pandemics.
`
`. If insurers deny coverage, they would be acting in bad faith.
`74. These Orders and proclamations, as they relate to the closure of all ..non_essential
`
`businesses" and restrictions on essential businesses evidence an awareness on the part ofboth state
`
`and local govemments that COVID-19 causes damage to property. This is particularly true in
`
`places where business is conducted, such as Plaintiffs', as the requisite contact and interaction
`
`causes a heightened risk ofthe property becoming unsuitable for business.
`75. Plaintiffs RHYTHM OF LIFE CORP D/B/A BROADWAY DANCE. and
`
`BROADWAY DANCE WEST 65rrr LLC. suffered losses as a direct consequence of the Civil
`
`Authority stay-at-home orders for public safety issued by the Govemor of New York and the State
`
`of New York generally. Accordingly, Plaintiffs have submitted a claim to Defendant related to
`
`such losses.
`
`76. However, Defendants have denied Plaintiffs claims in contravention of the clear
`
`policy language entitling Plaintifh to coverage for business losses arising out of the Civil
`
`Authority Orders.
`
`D.
`
`Imoact on Plaintiffs
`
`77. As a result of the Orders referenced, herein, PlaintiffRIIYTHM OF LIFE CORP
`
`D/B/A BROADWAY DANCE shut its doors to dance studio customers.
`
`78. As a result of the Orders referenced, herein, Plaintiff BROADWAY DANCE
`
`WEST 65rH LLC shut its doors to dance studio.
`
`79. Plaintiffs business loss occurred when the State of New York declared when the
`
`State of New York declared a State of Emergency on March 7 , 2020. lt suffered further when the
`
`State ofNew York required all non essential businesses to shut down on March 20,2020.
`
`12 of 18
`
`

`

`FILED: NEW YORK COUNTY CLERK 08/07/2020 02:43 PM
`NYSCEF DOC. NO. 1
`
`INDEX NO. 653674/2020
`
`RECEIVED NYSCEF: 08/07/2020
`
`80. Prior to March 7, 2020 Plaintiffwas opened to customers for all dance studio needs.
`
`Plaintiffs' dance studio is not a closed environment, and because people staff, customers,
`
`community members, and others - constantly cycle in and out of the dance studio offices/suite,
`
`there is an ever-present risk that the Covered Properties are contaminated and would continue to
`
`be contaminated. In fact, it's probable that Plaintiffs dance studios suffered contamination based
`
`upon customers later being diagnosed as suffering from Coronavirus (COVID-l9).
`
`81. Businesses like the Plaintiffs' dance studio are more susceptible to being or
`
`becoming contaminated, as both respiratory droplets and fomites are more likely to be retained on
`
`the Covered Properties and remain viable for far longer as compared to a facility with open-air
`
`ventilation.
`
`82. The presence of COMD-19 on premises is confirmed as an employee of Plaintiff
`
`RHYTHM OF LIFE CORP D/B/A BROADWAY DANCE was diagnosed with COVID-I9 by a
`
`medical professional.
`
`83. Plaintiffs' businesses are also highly susceptible to rapid person-to-property
`
`transmission ofthe virus, and vice-vers4 because the sewice nature ofthe businesses place staff
`
`and customers in close proximity to the property and to one another and because the nature of a
`
`dances studio involves a high level ofrespiratory droplets and fomites being released into the air
`
`ofthe property during dance and contacting dance studio equipment.
`
`84. The virus is physically impacting Plaintiffs. Any effort by defendants to deny the
`
`reality that the virus causes physical loss and damage would constitute a false and potentially
`
`fraudulent misrepresentation that could endanger the Plaintiffs and the public. Dance studio
`
`equipment in the practice as well as other property in the practice has been impacted by exposure
`
`to the Covid-l9 Virus.
`
`85. It is probable that COVID-I9 particles have been physically present at Plaintiffs
`
`premises described in the Policy during the Policy period.
`
`13 of 18
`
`

`

`FILED: NEW YORK COUNTY CLERK 08/07/2020 02:43 PM
`NYSCEF DOC. NO. 1
`
`INDEX NO. 653674/2020
`
`RECEIVED NYSCEF: 08/07/2020
`
`86. It is probable that COVID-I9 particles have been physically present on surfaces
`
`and items of property located at Plainfiffs' premises described in the policy during the policy
`
`period.
`
`87. It is probable that airbome COVID-l9 particles have been physically present at
`
`Plaintiffs' premises described in the Complaint during the Policy period.
`
`88. It is probable that airborne COVID-l9 particles have been physically present at
`
`Plaintiffs premises described in the Policy during the Policy period.
`
`89. Plaintiffs have sustained direct physical loss and damage to items of property
`
`located at its premises and direct physical loss and damage to its premises described in the Policy
`
`as a result of the presence of COWD-19 particles and./or the Pandemic.
`
`90. Plaintiffs submitted timely insurance claims to defendants. Exhibit "E" and "F"
`91. Any purported viral exclusion does not apply here because a legal proximate cause
`
`ofthe Plaintiffs losses was the civil authority orders issued by the State ofNew York and similar
`
`civil authority orders. Defendant could have chosen to add an anti-current exclusion that would
`
`have excluded viruses "regardless of any cause or event that contributes concurrently or in any
`
`sequence to the loss" but did not do so. Many other insurance companies have such language
`
`related to their purported viral exclusions.
`
`92.
`
`Also, while the policy contains a virus exclusion - the policy does not exclude
`
`coverage for a national state of disaster like the current pandemic. The insurance industry knows
`
`how to exclude "pandemics and epidemics" and has done so in other contexts. See.
`
`httos://www.travelinsurance.com/brochure/Allian2/Allianz:Basic FL 0216.pdf ("You aren't
`
`covered for any loss that results directly or indirectly fiom any ofthe following general exclusions.
`
`The following Events: an epidemic or pandemic[.]"). Here it did not.
`
`93. The simple truth is that Defendants pre-determined its intent to deny coverage for
`
`any business intemrption claim related to COVID-I9 pandemic and civil authority orders
`
`14 of 18
`
`

`

`FILED: NEW YORK COUNTY CLERK 08/07/2020 02:43 PM
`NYSCEF DOC. NO. 1
`
`INDEX NO. 653674/2020
`
`RECEIVED NYSCEF: 08/07/2020
`
`connected to the COVID-19 pandemic; which explains the quick and cursory denial of the claims
`
`timely submitted to defendants herein.
`
`94. A declaratory judgment determining that the coverage provided under the Policy
`
`will prevent the Plaintiffs from being left without vital coverage acquired to ensure the survival of
`
`the businesses due to the shutdown caused by the Civil Authority Orders is necessary_ As a result
`
`of these Orders, Plaintiffs have incurred, and continue to incur, among other things, a substantial
`
`loss of business income and additional expenses covered under the Policy.
`
`CAUSE OF ACT10N
`DECLARAT ORY RELIEF
`
`95. Plaintiffs re-allege and incorporate by reference into this cause of action each and
`
`every allegation set forth in each and every paragraph ofthis Complaint.
`
`96. Pursuant to NY CPLR $3001, the Supreme Court may render a Declaratory
`
`Judgment having the effect of a final judgment as to the rights and other legal relations of the
`
`parties to ajusticiable controversy whether or not further reliefis or could be claimed. If the Court
`
`declines to render a judgment is shall state its grounds.
`
`97. An actual controversy has arisen between Plaintiffs and the Defendants as to the
`
`rights, duties, responsibilities and obligations of the parties under the Policy in that Plaintiffs
`
`contend and, on information and belief, the Defendant disputes and denies that:
`
`a. The Civil Authority Orders constitute a complete or partial prohibition
`ofaccess to Plaintiffs' Covered Properties;
`
`b. The prohibition of access by the Civil Authority Orders has specifically
`"prohibit[ed] access to the premises" in whole or in part as set forth in
`the Policy's Civil Authority provision;
`
`c. The Policy virus exclusion does not apply here;
`
`d. The Civil Authority Orders trigger coverage;
`
`e. The Policy includes coverage for losses caused by the Civil Authority
`Orders;
`f. The Policy includes coverage for losses caused by the Coronavirus;
`
`15 of 18
`
`

`

`FILED: NEW YORK COUNTY CLERK 08/07/2020 02:43 PM
`NYSCEF DOC. NO. 1
`
`INDEX NO. 653674/2020
`
`RECEIVED NYSCEF: 08/07/2020
`
`g. The Policy provides coverage to Plaintiffs for any current and future
`civil authority closures of businesses in New York County and New
`York State due to physical loss or damage directly or indirectly from the
`Coronavirus under the Civil Authority coverage parurmeters;
`
`h. The Policy provides business income coverage in the event that
`Coronavirus has directly or indirectly caused a loss or damage at the
`insured premises or immediate area ofthe Covered Properties; and,
`i. Resolution ofthe duties, responsibilities and obligation of the parties is
`necessary as no adequate remedy at law exists and a declaration ofthe
`Court is needed to resolve the dispute and controversy.
`98. Plaintiffs seek a Declaratory Judgement to determine whether the Civil Authority
`
`Orders prohibit access to the premises in whole or in part of Plaintiffs' Covered Properties as set
`
`forth in the Policy's Civil Authority provision.
`
`99. Plainfiffs further seek a Declaratory Judgement to affirm that the Civil Authority
`
`Orders tri gger coverage.
`
`100. Plainfiffs further seek a Declaratory Judgment to aIfirm that the Policy provides
`
`coverage to Plaintiffs for any current and future Civil Authority closures of businesses in New
`
`York County and New York State due to physical loss or damage from the Coronavirus and the
`
`policy provides business income coverage in the event that Coronavirus has caused a loss or
`
`damage at the Covered Properties.
`
`101. Plaintiffs do not seek any determination of whether the Coronavirus is physically
`
`in or at any of the Covered Properties specifically, the amount of damages, or any other remedy
`
`other than declaratory reliei
`
`16 of 18
`
`

`

`FILED: NEW YORK COUNTY CLERK 08/07/2020 02:43 PM
`NYSCEF DOC. NO. 1
`
`INDEX NO. 653674/2020
`
`RECEIVED NYSCEF: 08/07/2020
`
`PRAYER FOR RELIEF
`
`WHEREFORf,, Plaintiffs herein pray as follows
`
`1) For a declaration that the Civil Authority Orders constitute a prohibition of
`access in whole or in paft to Plaintiffs' Covered Propenies.
`
`2) For a declaration that the prohibition ofaccess by the Civil Authority Orders
`"prohibits access to the premises" in whole or in part as stated in the Policy.
`
`3) For a declaration that the Civil Authority Orders trigger coverage under the
`Policy.
`
`4) For a declaration that the Policy provides @veftrge to Plaintiffs for any
`current, future and continued civil authority closures ofbusinesses in New
`York County and New York State due to physical loss or damage directly