In what stands as the first win for policyholders in a New York COVID-19 insurance coverage case, NY federal judge Analisa Nadine Torres with the U.S. District Court for the Southern District of New York has denied an insurer's dismissal of a COVID-19 coverage case, and issued a favorable decision for the insured, finding that the Contamination Exclusion was ambiguous, and that the Court lacked a sufficiently-developed factual record to rule on whether the Loss of Use exclusion encompassed the insured's losses. The case is Thor Equities, LLC v. Factory Mut. Ins. Co., 2021 U.S. Dist. LEXIS 62967 (S.D.N.Y. Mar. 31, 2021).

Thor Equities, LLC, (Thor) a commercial landlord, rents properties across the country to hundreds of tenants, for use in a variety of businesses including office space, retail stores, restaurants, and bars. On March 13, 2020, Thor purchased an insurance policy from Factory Mutual Insurance Company. The policy provided up to $750 million in coverage for property damage and business interruption losses.  Days later, state governments across the country adopted stay-at-home orders in response to the COVID-19 pandemic. As a result, many of Thor's tenants were forced to close shop and, unable to generate revenue, have requested abatements or other accommodations. Thor alleged that it suffered significant business interruption as a result of the pandemic.

Thor also alleges that confirmed cases of COVID-19 at multiple properties required the company to take action to secure and preserve those locations. At the commencement of this action, Thor estimated that it had already lost more than $20 million in rental income alone.