Businesses have struggled to accommodate the changes that have resulted from the coronavirus pandemic. Even with restrictions relaxing somewhat, businesses struggle to keep their workers and their customers safe from infection, while also keeping their businesses afloat. Here are five ways that COVID-19 has affected how businesses carry out their activities: Continue reading “Five Ways COVID-19 Has Affected Businesses”
Category: Business Law
Facebook Faces State and Federal Antitrust Suits
Facebook, the largest social media company in the world, is facing both federal and state antitrust lawsuits for alleged anti-competitive business practices. The lawsuits allege that the social media giant has abused its influence in the market to choke out competition and keep itself dominant in the tech industry. If the lawsuits are successful, it could force the company to divest itself of some of its assets, including other social media platforms it has acquired over time. Continue reading “Facebook Faces State and Federal Antitrust Suits”
Working From Home Raises Data Security Concerns
The coronavirus pandemic has led to many changes in the workplace, with the broad move to working from home being one of the most dramatic. With that shift away from the workplace, however, has come a breakdown in standard practices, leading to some employees relying on non-standard solutions for their workplace problems. In some cases, this has caused data security issues that can potentially impact how businesses protect their sensitive information. Continue reading “Working From Home Raises Data Security Concerns”
FCRA Preempts State Credit Reporting Laws, Says Federal Court
A federal district court has ruled that the Fair Credit Reporting Act (FCRA) preempts state credit reporting laws, curtailing the ability of state governments to place restrictions or regulations on credit reporting practices. In effect, this means that states can only put laws about credit reporting into place when they do not conflict with the FCRA. This decision has raised concerns among privacy advocates and labor advocates, who are concerned about how credit reporting might be abused. Continue reading “FCRA Preempts State Credit Reporting Laws, Says Federal Court”
FTC Enters Into Settlement With Zoom Over Unfair Practices
The major video conferencing platform, Zoom, has agreed to enter into a settlement with the Federal Trade Commission (FTC) over allegedly deceptive claims related to its security practices. The company has, for months, touted its supposedly superior security features to attract people to its platform. With this settlement, however, the company must significantly revise both its advertising and its security practices to better comply with FTC standards. Continue reading “FTC Enters Into Settlement With Zoom Over Unfair Practices”
Businesses Brace for Another Possible Quarantine
Few states were hit as hard, or as early, by the coronavirus pandemic as New York. As such, it was also one of the first states to enact a quarantine, and one of the first to get the disease under a measure of control. As infections have begun to skyrocket and more people are being hospitalized for COVID-19, businesses are now readying themselves for another possible quarantine. Continue reading “Businesses Brace for Another Possible Quarantine”
What is Direct Physical Loss in Business Interruption Insurance?
If you have business interruption insurance, then it is possible you may have looked at the provisions of your insurance contract and seen the phrase “direct physical loss.” This seemingly simple phrase can have a significant impact on whether you are able to collect on your policy, especially if you were forced to shut down due to COVID-19. So what is direct physical loss, and how can that affect your business interruption insurance claim?
What is Business Interruption Insurance?
Business interruption insurance is a kind of insurance that covers losses you suffer due to being forced to temporarily close your business. Rather than dealing with the direct physical costs, though, it addresses lost income due to being unable to operate your business as normal. For example, it might not cover water or mold damage you suffered in a flood, but it would cover your lost income for the time it took for the damage to be repaired.
How Do I Get Business Interruption Insurance?
There are two primary ways for a business owner to get business interruption insurance. The first is to specifically purchase a business interruption insurance policy from an insurer that offers it. The second is to have a business interruption clause as part of a general business insurance contract. With this second type of insurance, because many business owners may have business interruption insurance already and not know it. You should review your general business insurance policy. It’s always a good idea to know what you are and are not covered for.
Defining Direct Physical Loss
Many business interruption insurance contracts only cover business interruptions caused by “direct physical loss” to the business. Generally speaking, this has been interpreted by the courts to mean disasters that caused direct harm to the physical property of the business. For example, damage caused by a natural disaster like a fire, flood, or earthquake might qualify. So would damage caused by burglars, rioters, or vandals.
The Coronavirus Conundrum
One of the primary issues going through the courts right now is the issue of whether business interruptions caused by the coronavirus qualify as “direct physical loss.” The coronavirus, also known as COVID-19, has devastated businesses across the country, and New York was particularly hard-hit early in the pandemic. Businesses that lost income due to the COVID-19 quarantine have been looking to business interruption insurance to cover their losses, with mixed results.
Some courts have adopted a more general definition of the term and have been willing to expand the definition from its traditional boundaries to include coronavirus-related closures. Other courts, however, have kept to a strict definition of direct physical loss, resulting in COVID-19 claims being denied outright. As it stands, the issue remains unsettled law, both in New York and across the country.
Finding a Way Past Direct Physical Loss
Even if you cannot get a court to agree that coronavirus-related losses count as a direct physical loss, you may have other avenues open to you to recover under business interruption insurance. For example, if your contract has “civil authority” coverage, you may be able to get payment due to being forced to close by the government. Alternately, you may have a clause in your contract that covers closures due to illness or infectious disease. However, you cannot be certain until you have consulted with an attorney.
If you are a business owner with a business interruption insurance plan, and you want to recover for losses suffered due to the coronavirus pandemic, you should seek out a business law attorney with experience in the field. The business law attorneys at Blodnick, Fazio & Clark are skilled and knowledgeable in the areas of business law and commercial transactions. With offices conveniently located in Garden City, Nassau County, and Babylon, Suffolk County, the firm provides high-quality legal care at reasonable prices. If you require legal assistance concerning business startups, formation, corporate acquisitions and mergers, corporate restructuring, or another business matter, call (516) 280-7105 or fill out our contact form for a free consultation.
Three Major App Settlements Address Alleged COPPA Violations
Three separate settlements seeking approval before the Northern District of California may set a precedent for app makers dealing with children’s data. All three settlements concern the Children’s Online Privacy Protection Act (COPPA), legislation that imposes legal restrictions on how app makers and other companies treat the data collected from apps and websites targeted at children. Depending on the outcome of these settlements, it could seriously impact how apps handle children’s personal data going forward. Continue reading “Three Major App Settlements Address Alleged COPPA Violations”
8th Circuit: Coronavirus Losses Are a “Direct Physical Loss”
In what may be a promising turn of events for people with business interruption insurance, the Eighth Circuit of the United States Court of Appeals has just ruled that losses related to the coronavirus pandemic are a “direct physical loss.” This ruling is important as it signals how other courts may rule when confronted with similar issues, and with many businesses forced to close due to the pandemic, they are looking for any way to stave off their losses. Unsurprisingly, however, insurers who issued these policies are less than pleased at the court’s interpretation of the law. Continue reading “8th Circuit: Coronavirus Losses Are a “Direct Physical Loss””
App Stores Face Legal Challenge from Fortnite Creator
Apple and Google have been sued by Epic Games after both companies removed the popular online game Fortnite from their app stores. Epic Games, a video game publisher with its own proprietary online store, has alleged that Apple and Google have engaged in monopolistic practices by removing the game from its stores. The lawsuit brings up potential antitrust implications against Google and Apple, whose app stores serve as private marketplaces for consumer software of all types. Continue reading “App Stores Face Legal Challenge from Fortnite Creator”
