3-Feb-21 – The owner of theWit hotel is suing its insurance company over its apparent denial of claims resulting from damage sustained last year during rioting in downtown Chicago.

ECD-Great-Street DE, LLC, is suing Zurich American Insurance Company, alleging the Schaumburg-based company is not honoring an “all-risk” insurance policy it issued that ECD says covers property damage and lost income caused by business interruption.

Despite losses it incurred and “substantial premiums” it paid, ECD says Zurich has not responded promptly to communications, let alone approved work and expenses needed to repair the hotel. ECD says they did, however, pay a “severely discounted portion” of lost income for June and July but nothing after that.

ECD estimates its losses due to business interruption following the May 30, 2020, riot, through December 31, 2020, at $14,826,973.

For about one hour, starting at about 7:00 p.m. on the night of May 30, about 100 rioters ransacked the 27-floor 310-room hotel’s lobby and restaurant at the corner of State & Lake Streets. Using hammers, pipes, baseball bats, and stanchions used for crowd control, they damaged, destroyed, and stole flooring, furniture, draperies, artwork, equipment, and fixtures. They broke all of the ground floor lobby windows. Right outside the hotel, rioters set fire to a Chicago Police Department vehicle, then, according to ECD, hindered firefighters from putting out the fire quickly, resulting in damage to the sidewalk, planters, and streetlights.

(Left) Image provided by the United States Attorney’s Office showing a man in a “joker” mask sitting on a curb near theWit hotel. Identified as Timothy O’Donnell of Chicago, he was arrested on a federal arson charge for allegedly setting the marked but unoccupied police SUV on fire.

Soon after that, theWit closed its hotel, ground-floor restaurant, and rooftop lounge for four months over the summer and early fall, earning virtually no income during that time. They reopened in October.

In its complaint filed in Cook County Circuit Court on January 27, 2021, ECD says theWit hotel was “the epicenter of protests and vandalism” across Chicago on May 30, 2020, that were a reaction to the death of George Floyd.

According to ECD, Zurich told them they could have mitigated losses by re-opening the restaurant and rooftop lounge sooner, even though the demolished lobby had not yet been repaired. ECD says they could not open State & Lake and ROOF sooner “without violating law and exposing the public, hotel employees, and those working to repair the hotel to significant safety risks, as well as exposing the hotel to potential significant liability.”

Scott Greenberg, principal of ECD, called the insurance claim denials “wrongful and bad faith.”

“Zurich has failed to appropriately respond to our insurance claim and make payments to which we are entitled,” said Greenberg (right). “We have filed this lawsuit against Zurich in order to vindicate our rights and enforce Zurich’s obligations under the policy. We look forward to prosecuting our claim against Zurich in court and obtaining the legal relief to which we are entitled.”

The case has since been transferred to United States District Court.