Garmany sued its insurer over pandemic-related losses. (Photo by John T. Ward. Click to enlarge.)


hot topic red bank njUpscale Red Bank clothing retailer Garmany lost a federal lawsuit Thursday in which it sought insurance reimbursements for pandemic-related losses.

Those losses, it argued, were caused by Governor Phil Murphy’s shutdown of the state’s economy a year ago, and not the COVID-19 virus itself.

As first reported by the legal website Law360, the Broad Street store sued Harleysville Insurance Company when the insurer rejected a claim filed last April over business interruption.

The policy included a “virus or bacteria” exclusion. But Garmany, through its attorneys, argued that its losses were caused not by the pandemic, but by Murphy’s emergency shutdown of non-essential businesses, and thus should have been covered, according to the report.

But in an opinion issued Thursday, district court Judge Freda Wolfson granted Harleysville’s motion to dismiss the lawsuit. She found that Garmany “fails to acknowledge that the policy provides that loss caused ‘directly or indirectly’ by a virus is excluded.”

Moreover, the business “cannot show that the executive orders, and not the COVID-19 virus, were the proximate cause of its losses,” she wrote.

Garmany principal Johnell Garmany did not immediately respond to a redbankgreen question about an appeal.

Here’s the judge’s opinion: Garmany v Harleysville opinion 031821.pdf

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