The Hon. John T. Copenhaver Jr., senior Unites States district judge, reversed a jury’s $32.7 million verdict originally awarded in favor of Ramaco on July 16 in its lawsuit against insurance companies indirectly owned by Chubb INA Holdings Inc. as it could not be upheld under the terms of the issued insurance policy.
The case — Ramaco Resources LLC v. Federal Insurance Co. and Ace American Insurance Co.— centered on a silo that was damaged at Ramaco’s Elk Creek complex, shutting down operations on November 5, 2018. Ramaco believed the period of restoration should have been the seven months required to demolish the failed silo and upgrade the remaining two silos, ending June 7, 2019. However, because the failed silo became operable on November 30, 2018, and the two remaining silos were not damaged, the court determined the period of restoration had ended on November 30, 2018.
As a result, the court reduced the business interruption award significantly from $7.7 million to $1.6 million. Additionally, the court found Ramaco was not entitled to aggravation and inconvenience damages because it did not “substantially prevail” in its claim, and dismissed the additional $25 million award.
This reversal of more than $31.1 million reinforces the fact that companies are not entitled to business interruption claims to make improvements on their property but rather can only address the damages faced.