Jujamcyn Theaters is suing its insurers over a lack of coverage during the pandemic.
The theater owner, which operates five Broadway theaters, was denied coverage under its property insurance policy and received just $250,000 in business interruption insurance for all of its theaters, according to the suit. The payout pales in comparison to the more than $29.4 million in business income losses Jujamcyn says it may lose while theaters are closed.
Jujamcyn Theaters filed the suit Tuesday in the U.S. District Court for the Southern District of New York against Federal Insurance Company and Pacific Indemnity Company. Both insurers are part of the Chubb group of insurance companies.
Jujamcyn carried insurance coverage on the physical theaters under a Federal Insurance policy. It also carried performance disruption coverage under the Pacific Indemnity Policy.
Before Broadway theaters were ordered to close on March 12, Jujamcyn’s five theaters were home to “Hadestown,” “The Book of Mormon,” “Moulin Rouge,” “Frozen,” which has since permanently closed, and “Mean Girls,” respectively. As previously reported, Broadway shows were still receiving rent bills from the theater owners during the shutdown, but not necessarily paying.
After the initial shutdown, Jujamcyn presented its insurance claim to Federal. However, the theater owner was denied coverage as the insurance company found its losses were not due to “direct physical loss or damage or due to the prohibition of access by a civil authority,” according to the suit. Jujamcyn contends that its policy covers economic losses from “the actual impairment” of business and does not specifically exclude pandemics or viruses.
Further, attorneys for Jujamcyn point to Gov. Andrew Cuomo’s executive order to close theaters, and the uncertain timeline for reopening.
“There is no date set or anticipated by which theaters will be permitted to reopen in any capacity. There is also no set date set or anticipated by which theaters will be permitted to reopen at full capacity (or if theaters will ever be permitted to do so absent, for example, the worldwide availability of a vaccine),” the suit reads.
Broadway theaters are currently closed through at least Jan. 3 and several shows are targeting spring opening dates. However, there is not yet an official reopening date.
Additionally, the suit states that a reopening of Jujamcyn theaters may require physical alterations to the space, including “the erection of protective barriers and partitions, new or re-designed air flow and filtration systems, and even the redesign and physical alteration of the theaters themselves.”
According to the suit, Jujamcyn had informed Federal of at least seven cast members or workers who tested positive for COVID-19 or antibodies while working within its theaters.
Pacific’s performance disruption policy limits the payout for each loss to $250,000. According to the suit, Jujamcyn expected to receive the $250,000 payout for each of the five interrupted productions. However, the theater owner was told that the limit covered losses across all of its theaters.
Jujamcyn is suing both companies on charges including breach of contract and requesting a jury trial on the matter and damages “in an amount to be proven at trial.”
Neither Jordan Roth, president of Jujamcyn Theaters, nor Chubb responded to a request for comment in time for publication.