Threaded Order Chronological Order
| Jujamcyn sues over paltry Covid payout | |
| Posted by: StageLover 02:24 pm EDT 08/26/20 | |
|
|
|
| per Deadline | |
| Link | https://deadline.com/2020/08/jujamcyn-theaters-broadway-lawsuit-chubb-insurance-covid19-coronavirus-1203023669/ |
| reply to this message | |
| re: Jujamcyn sues over paltry Covid payout: my personal experience | |
| Posted by: NewtonUK 08:05 am EDT 08/27/20 | |
| In reply to: Jujamcyn sues over paltry Covid payout - StageLover 02:24 pm EDT 08/26/20 | |
|
|
|
| first, may I say that my clear understanding is that all of the Broadway shows which suspended, but did not close or load out, are paying weekly basic rent to the theatreowners at the very least. Just like your landlord - no way around the rent. I also understand that theatreowners are being patient, waiting for shows to collect their insurance, to pay that rent. And i also understand that owning theatres is highly profitable, so get over it Jujamcyn. Beyond that, I have had a show (actually 3, but thats another story) close. Our offices, like Jujamcyn's theatres, have General Liability Insurance - and these policies only pay off if you are forced to close because of physical inability to use one's offices (or theatre). If you are still collecting rent, you havent closed. And the loss from having no performances is not considered your loss, its the Producers loss. Jujamcyn is not the producer. Restaurants can't claim on their insurance either for the same reason. So we pay office rent, even though we are not using our offices, and our insurance will not cover this. Most Broadway shows have the same insurance that my show has - its included as an option not in General Liability, but in the Theatrical Package - which covers scenery, costumes, lighting equipment, third party damage, AND performance disruption insurance. The theatrical package on our show cost us $4,057. It is paying us MUCH more than that. Now, this show wasn't ON Broadway - some Broadway shows have received $4-5 million to date from insurance carriers. And it is indeed the 'closed by Civil Authorities' clause that allows one to get a policy payout, on the Theatrical Package/Performance Disruption polices. These policies are written on the assumption that maybe there will be a blizzard, or terrorist attack or some short term even that may cause your show to miss up to a week or so of performances. No one thought pandemic, and so there was no exclusion in these policies. Insurers - mainly Chubb on Broadway - are taking a huge hit. Of course these policies have a maximum payout. And how do you figure out what the loss from 'performance disruption' was? Fairly simple, if your show is already open. In our case, we took the average weekly net operating profit, before royalties. In doing this we eliminated our best and worst weeks for the computation. We came up with our average weekly projected operating profit based on sales to date, and showed advance sales, and our ten week out chart, as well. The first two (2) lost performances are not covered. We added to this some costs we incurred by closing without notice. Multiplied projected weekly operating profit times total lost weeks, added the extra costs, made the claim. The insurance paid 98% of what we claimed. Theatreowners did not/do not have the option to take out this kind of Theatrical Package insurance - it is specifically for productions. One play. By the production company. We know that all insurers, going forward, will now have a pandemic exclusion on these polices, although they may pay for 'x' lost performances even then. |
|
| reply to this message |
| re: Jujamcyn sues over paltry Covid payout: my personal experience | |
| Posted by: ryhog 09:56 am EDT 08/27/20 | |
| In reply to: re: Jujamcyn sues over paltry Covid payout: my personal experience - NewtonUK 08:05 am EDT 08/27/20 | |
|
|
|
| This is a good general summary to which I will add only one footnote (mentioned elsewhere) which is that insurance policies are negotiable and are not all the same. While the described insurance is likely present in all off-B productions and many if not most Broadway productions, it is not universal. Disney almost certainly does not insure in this way and there may well be other producers doing something similar (Mackintosh coming quickly to mind). And likewise there is no set policy for theatre landlords any more than for any landlord but the nature of the beast is such that the primary focus is on property not revenue but they do not have to buy a product off the shelf although it sounds like Jujamcyn mostly did. | |
| reply to this message | reply to first message |
| re: Jujamcyn sues over paltry Covid payout: my personal experience | |
| Posted by: fosse76 12:40 pm EDT 08/27/20 | |
| In reply to: re: Jujamcyn sues over paltry Covid payout: my personal experience - ryhog 09:56 am EDT 08/27/20 | |
|
|
|
| Just to add, the Shubert Organization also "invests" in many, if not most, of the shows in its houses. I imagine they would also have some type of modification to the insurance as described above. I imagine Jujamcyn and Nederlander do as well, but I'm not sure if it is as prolific as it is with the Shuberts. | |
| reply to this message | reply to first message |
| The shocking thing here... | |
| Posted by: wisebear 07:04 pm EDT 08/26/20 | |
| In reply to: Jujamcyn sues over paltry Covid payout - StageLover 02:24 pm EDT 08/26/20 | |
|
|
|
| ...is that the policies did NOT exclude pandemics. Most businesses are just now finding out that their policies DO exclude pandemics, so they truly are not covered. But without that exclusion, I believe the insurance companies will lose this fight. | |
| reply to this message | reply to first message |
| re: Jujamcyn sues over paltry Covid payout. No surprise | |
| Posted by: Duke1979 04:55 pm EDT 08/26/20 | |
| In reply to: Jujamcyn sues over paltry Covid payout - StageLover 02:24 pm EDT 08/26/20 | |
|
|
|
| These are the same issues being litigated by restaurants. These policies are intended to cover business losses when there is physical property damage such as a fire or flood. They only provide business interruption losses that are related to such an event. Closing on account of Covid is not physical injury. There ought to be relief for the entertainment and hospitality industry but trying to wedge it into an insurance policy that was never intended to cover these losses is not the way to address the problem. | |
| reply to this message | reply to first message |
| re: Jujamcyn sues over paltry Covid payout | |
| Posted by: paymon 03:37 pm EDT 08/26/20 | |
| In reply to: Jujamcyn sues over paltry Covid payout - StageLover 02:24 pm EDT 08/26/20 | |
|
|
|
| There are more details in the Forbes article. | |
| Link | Forbes Article |
| reply to this message | reply to first message | |
| re: Jujamcyn sues over paltry Covid payout | |
| Last Edit: JereNYC 04:03 pm EDT 08/26/20 | |
| Posted by: JereNYC (JereNYC@aol.com) 03:58 pm EDT 08/26/20 | |
| In reply to: re: Jujamcyn sues over paltry Covid payout - paymon 03:37 pm EDT 08/26/20 | |
|
|
|
| The insurance company is really walking a bullshit line here by saying that, although the theatres were closed by order of the Governor, that access to them is not actually prohibited, evidenced by the fact that Jujamcyn has been able to check in that the buildings are okay. They are saying that, because security can access the buildings, somehow that means that Jujamcyn could be using them for business purposes, but is not. The precedent being cited here is when the Roundabout sued their insurance company over the incident with the collapsed construction crane in Times Square in 1998 that blocked access to Henry Miller's Theatre, where the revival of CABARET had been running. In that case, because Henry Miller's itself was not damaged, the insurance company wasn't going to pay out because a clause in the Roundabout's policy said that damage to the building itself had to have occurred. So, although the theatres are closed by order of the Governor, the insurance company must think that Jujamcyn should have defied the order and opened their theatres anyway. I assume that, had Jujamcyn done so, there would have been arrests due to defying the close order. It's pretty insane. |
|
| reply to this message | reply to first message |
| re: Jujamcyn sues over paltry Covid payout | |
| Posted by: ryhog 06:36 pm EDT 08/26/20 | |
| In reply to: re: Jujamcyn sues over paltry Covid payout - JereNYC 03:58 pm EDT 08/26/20 | |
|
|
|
| At this very early stage, it is normal to plead the kitchen sink. I realize that these clickbait articles want you to read the complaint and answer as more than they are, but they will both be amended, in both directions. I would not expect a lot of movement in policies in the future. If you are big enough, you can buy any coverage you want, if you are willing to pay for it. No one was thinking of this when they negotiated policies, because it is not what they were worried about. And they won't be again because people hate paying premiums they can avoid, and the price of pandemic coverage will go up of course. Ironically, a lot of business interruption insurance lawsuits right now are the inverse of this: the policies exclude shutdowns by governmental authority. If I had to guess, I would say the Shuberts are probably self-insured, with some blanket reinsurance to cover major catastrophes, quite probably not including this. The day of reckoning is not whether these and other rich landlords get a few bucks; it is how the insurance companies get through this. I am a lot more worried about the small businesses in the theatre district than I am about the big landlords. When we come out of the other end of this, they will still own their real estate. |
|
| reply to this message | reply to first message |
| re: Jujamcyn sues over paltry Covid payout | |
| Posted by: paymon 04:36 pm EDT 08/26/20 | |
| In reply to: re: Jujamcyn sues over paltry Covid payout - JereNYC 03:58 pm EDT 08/26/20 | |
|
|
|
| The civil authority argument does seem weak. But, regarding the other argument, it makes sense that Jujamcyn’s claim does not satisfy the requirement for physical damage. | |
| reply to this message | reply to first message |
| re: Jujamcyn sues over paltry Covid payout | |
| Last Edit: JereNYC 04:58 pm EDT 08/26/20 | |
| Posted by: JereNYC (JereNYC@aol.com) 04:53 pm EDT 08/26/20 | |
| In reply to: re: Jujamcyn sues over paltry Covid payout - paymon 04:36 pm EDT 08/26/20 | |
|
|
|
| My guess is that that the pandemic will lead to much more specific language in insurance policies that will specifically mention either ordered closure by the city, state, or Federal government for any reason or closure as the result of a pandemic or both. The insurance company wants to follow the letter of the agreement, while Jujamcyn is arguing the spirit of the agreement. Given that the scope of the pandemic is pretty unprecedented, I could see a judge siding with Jujamcyn in this case. They purchased business interruption insurance and, through no fault of their own, and, in fact, by order of the governor, their business was interrupted. But, if they lose, I'm sure they're be fine. If there's ever an advantage to being the scion of billionaires, it would be now. Not that there's ever NOT advantage in being the scion of billionaires. |
|
| reply to this message | reply to first message |
Time to render: 0.040859 seconds.