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Circus Circus Lv v. Aig Specialty Ins. Co.

Circus Circus Lv v. Aig Specialty Ins. Co.

United States District Court for the District of Nevada

February 26, 2021, Decided; February 26, 2021, Filed

Case No.: 2:20-cv-01240-JAD-NJK

Opinion

 [*1272]  Order Granting Defendant's Motion to Dismiss, Denying its Motion for Leave to File Supplemental Authority, and Granting Plaintiff's Motion for Leave to Amend

[ECF Nos. 17, 54, 62]

Circus Circus sues AIG Specialty Insurance Company for failing to provide coverage for economic losses it incurred from the government-mandated closure of its casino during the COVID-19 pandemic.1 AIG moves to dismiss under Federal Rule of Civil Procedure 12(b)(6), arguing that Circus Circus's "all risks" [**2]  policy does not cover its claims and any alleged damage caused by the SARS-CoV-2 virus is precluded by its pollutants-or-contaminants exclusion.2 Due to the nationwide prevalence of these suits, AIG also seeks leave to file supplemental authority for my consideration.3 Circus Circus maintains that it has sufficiently alleged coverage under its policy, and seeks leave to amend to add additional claims for breach of the implied covenant of good faith and fair dealing and violations of Nevada law.4

I find that AIG's additional filing does not aid my decision in this case because AIG provides no additional, controlling precedent, so I deny its motion for leave to file supplemental authority. Because Circus Circus does not and cannot allege direct physical loss or damage—to its property or others'—sufficient to trigger coverage under its insurance policy, I grant AIG's motion and dismiss those claims with prejudice. But I grant Circus Circus leave to amend to add claims for violations of NRS 686A.310(1)(c).

Background5

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525 F. Supp. 3d 1269 *; 2021 U.S. Dist. LEXIS 36306 **; 2021 WL 769660

Circus Circus LV, LP, Plaintiff v. AIG Specialty Insurance Company, Defendant

CORE TERMS

coverage, physical loss, insured, virus, casino, courts, futile, cause of loss, amend, motion for leave, physical damage, pollutants, pandemic, damaged, Contaminants, Interruption, discovery, closure, losses, leave to amend, extra expense, good cause, supplemental, allegations, alteration, argues

Insurance Law, Obligations of Parties, Insurers, Allegations in Complaints, Business Insurance, Commercial General Liability Insurance, Duty to Defend, Property Insurance, Obligations, Liability & Performance Standards, Good Faith & Fair Dealing, Policy Interpretation, Ambiguous Terms, Coverage Favored, Claim, Contract & Practice Issues, Entire Contract, Ordinary & Usual Meanings, Plain Language, Policy Interpretation, Exclusions, Burdens of Proof, Claims Made Policies, Exclusions, Unambiguous Terms, Civil Procedure, Pretrial Matters, Conferences, Case Management, Scheduling Conferences, Pleadings, Amendment of Pleadings, Leave of Court, Pretrial Orders, Contracts Law, Contract Interpretation, Good Faith & Fair Dealing, Business & Corporate Compliance, Industry Practices, Unfair Business Practices, Claims Investigations & Practices, Unfair Trade Practices Acts