Musso & Frank Shows Some Old School Moxie And Sues Its Insurance Company

One of Los Angeles's oldest restaurants has sued its insurance company, a harbinger of the lawsuits we'll likely see as more businesses file coronavirus-related claims with their insurers — and get denied.

Musso & Frank, which turned 100 years old at the end of 2019, has filed a lawsuit against Mitsui Sumitomo Insurance USA, alleging the insurer wrongly denied its claims. The filing was first reported by dot.la.

In the 243-page suit, which you can read here, Musso's attorneys state the restaurant paid all its premiums (nearly $4,000 per month or $46,919.15 for the period from June 30, 2019 to June 30, 2020). On March 19, Musso's filed insurance claims for business income losses due to COVID-19.

On April 1, just under two weeks later, the restaurant received word Mitsui Sumitomo had denied its claims.

Musso's attorneys allege the restaurant's claims were "not properly investigated" and that Mitsui acted in bad faith. In addition, Musso's attorneys claim Mitsui Sumitomo's denial of this claim is part of an "ongoing pattern and practice."

Musso & Frank is beloved for its stiff martinis, its red-jacketed waiters and its "continental" cuisine. But the oldest of old school joints may have a tough battle.

As described in the suit, Musso's insurance policy has a clause that states Mitsui Sumitomo "will not pay for loss or damage caused by or resulting from any virus, bacterium or other micro- organism that induces or is capable of inducing physical distress, illness or disease."

Musso & Frank isn't the only restaurant to sue its insurer.

In late March, Thomas Keller, the chef behind the French Laundry, Per Se and Bouchon, filed suit in Napa County against insurer Hartford Fire Insurance Company. He wants to establish a legal precedent that states the company must cover coronavirus-related business losses. (Keller is also serving on President Donald Trump's "economic revival industry group" for restaurants.)

This week, Pez Cantina in downtown L.A. sued Travelers Indemnity Co., seeking a court declaration that its suspension of business under a city order represents a "direct physical loss" as defined in the restaurant's policy.

We're following this story and reaching out to representatives for both Musso and Mitsui Sumitomo.