Ooka Sushi Hibachi Restaurant, Inc. v. Hartford Underwriters Insurance Company et al

Ooka Sushi Hibachi Restaurant, a Pennsylvania-based Japanese eatery, suffered severe revenue losses when state COVID-19 shutdown orders forced it to suspend dine-in services. The restaurant filed a claim under its commercial property insurance policy with Hartford Underwriters Insurance Company, arguing that the virus contamination and closure mandates constituted “direct physical loss of or damage to” the property. Hartford denied coverage. Ooka Sushi sued in the U.S. District Court for the Eastern District of Pennsylvania, which dismissed the suit, ruling that purely economic losses and viral presence do not amount to tangible physical damage. The U.S. Court of Appeals for the Third Circuit affirmed in 2022. The restaurant petitioned the U.S. Supreme Court for a writ of certiorari. On March 9, 2026, the Supreme Court denied the petition, leaving the lower court rulings in place and foreclosing further appeal.

The U.S. Supreme Court denied certiorari on March 9, 2026, making the Third Circuit’s ruling final. That ruling held that the policy did not provide coverage because the restaurant failed to allege tangible, physical alteration of its premises. The district court’s dismissal with prejudice was effectively upheld.

Whether the presence of the COVID-19 virus and government-ordered shutdowns trigger coverage for “direct physical loss of or damage to” property under a standard commercial property insurance policy.

This denial solidified the majority judicial position across the United States that standard business-interruption policies do not cover pandemic-related closures absent physical structural change. It offered conclusive legal clarity for insurers and policyholders, underscoring that legislative action or specialized coverage is necessary to address future pandemic risks. The outcome further discouraged remaining COVID-19 business-loss suits nationwide.