Businesses on the Jersey Shore Sue Lloyd’s of London Due to Hurricane Sandy Losses

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A pair of Seaside Heights night clubs made famous by the TV show “Jersey Shore” are suing their insurer, Lloyd’s of London, for unpaid losses due to the devastation following Hurricane Sandy. The storm also damaged the Bamboo Bar, an attorney for the Saddy Family wrote in the complaint. Lloyd’s of London and others are being accused by Saddy Family LLC, of bad faith and breach of contract, alleging they refused to pay or even decided the validity of the claims that were estimated at hundreds of thousands of dollars.

The lawsuit claims Hurricane Sandy cost the Karma and Bamboo nightclubs hundreds of thousands of dollars in potential revenue because of Governor Christie’s mandatory order of evacuation that kept Seaside Heights closed and off-limits for months following the storm. Operators of the nightclubs said they filed a series of claims that when totaled, was valued at more than $1.9 million. From this amount it was estimated that $800,000 was for business interruption  for the two clubs and the property damage for The Bamboo Bar was $817,000, according to NJ.com.

  

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The Saddy Family LLC said they produced thousands of documents and 18 hours of recorded testimony to support their claims. They have only been paid $20,367 for the palm trees the Bamboo Bar lost during the storm and $63,369 for all of the sound equipment stolen from the club after the storm passed. According to the club owner he alleged that the independent adjuster, sent by Lloyd’s of London to handle the claim only made a “cursory” inspection of the nightclubs before denying coverage for the property damage. There was also a verbal report that claims an engineer’s findings that the Bamboo Bar had a “design defect,” and that wind could not have damaged the building.

Both venues are open and running, according to their Facebook page. The insurer has not made a decision on the business interruption claims, the complaint said. The Saddy Family is accusing Lloyd’s of London and other defendants of willfully refusing to pay for club losses and interest or income off the money before paying the claim.

An attorney for Lloyd’s, Michael Gorelick of Abrams Gorelick Friedman & Jacobson of New York, said his clients “deny all of the allegations of the complaint. They have thoroughly investigated this claim. They paid everything they believe is required to be paid under the policies.” A representative for the adjusting firm Lamarche Associates, did not return calls, and the attorney for Quaker Special Risk, an insurance brokerage named in the Saddy’s complaint did not comment. The lawsuit was reported by Law360, a legal news service.