Buttermilk restaurants, cinema in Woodridge filed insurance lawsuit due to COVID-19

The owners of Buttermilk restaurants in Geneva and Naperville, and one that hasn't opened yet in Vernon Hills, and the owners of Hollywood Boulevard Cinema in Woodridge filed a lawsuit against their insurance company about denial of claims during the COVID-19 pandemic.

The lawsuit against Society Insurance in Wisconsin was filed last week by Biscuit Cafe, Inc., Buttermilk Naperville, Inc., BM Vernon, Inc., and Hobson Financial Group of Illinois in U.S. District Court, Northern District of Illinois, Eastern Division. The lawsuit seeks class-action status.

The movie theater is closed and the restaurants in Geneva and Naperville can only provide pickup and delivery services during the pandemic, as per the state's orders. A new Buttermilk restaurant in Vernon Hills wasn't able to open April 20 as scheduled, the lawsuit states.

The businesses were denied claims for business income and extra expenses, the lawsuit states. "Unlike many commercial property policies available on the market, the 'all-risk' policy that defendant sold to plaintiffs does not exclude loss caused by a virus," it states.

Rebecca Kollmann, Society Insurance corporate marketing manager, said the company doesn't comment on ongoing litigation. "We look forward to a favorable resolution of this situation in the near future," she said.

The lawsuit states Society Insurance denied Hollywood Boulevard Cinema's claim on April 1, and "effectively denied" the claim submitted by Buttermilk on March 25 by failing to respond for nearly a month.

Attorney David Fish of Naperville said his clients are losing money every day. "We don't know right now the full extent of our clients' losses," he said.

The lawsuit also states that "upon information and belief, people carrying COVID-19 particles" had been in the businesses. Fish didn't respond to a question about whether that referred to specific people.

The insurance company's denial took place without "a reasonable investigation," as required by state law, and was "vexatious and unreasonable," the lawsuit states. The businesses are seeking an additional judgment of $60,000 per business and at least 60% of what they are deemed entitled to recover in court, plus attorney fees and related costs.

"Our clients are small family owned businesses that were just trying to make it, and this is just horrible for them," Fish said.