IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF ILLINOIS

EASTERN DIVISION

VALLEY LO CLUB ASSOCIATION, 

INC. d/b/a VALLEY LO CLUB, and all 

others similarly situated,

Plaintiffs,

v.

THE CINCINNATI INSURANCE 

COMPANY,

Defendant.

No. 20-cv-04790

Judge Franklin U. Valderrama

MEMORANDUM OPINION AND ORDER

COVID-19, a novel coronavirus, has wreaked havoc on the lives of many and 

caused untold financial losses. This case is but another in a long line of cases in which 

businesses seek coverage for their financial losses.

Plaintiff Valley Lo Club Association, Inc. (Valley Lo) owns and operates Valley 

Lo Club, a country club which consists of an 18-hole golf course and several onpremises restaurants and dining areas (the Club) in Glenview, Illinois. R. 15, FAC

¶¶ 4–5.1 Valley Lo purchased a commercial property insurance policy from The 

Cincinnati Insurance Company (Cincinnati). Id. ¶ 43. After Valley Lo was forced to 

suspend or reduce business at the Club due to COVID-19 pandemic and the resultant 

closure order issued by the Governor of Illinois, it filed a claim with Defendant, who 

denied coverage. Id. ¶¶ 71–72.

1Citations to the docket are indicated by “R.” followed by the docket number or filing name, 

and where necessary, a page or paragraph citation.

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Valley Lo filed this class action suit2 against Cincinnati for breach of contract

and declaratory relief. FAC. It seeks damages for loss of business income suffered due 

to the closure orders. Id. ¶¶ 93–112. Cincinnati also seeks a declaratory judgment 

that the losses incurred are insured losses under its policy. Id. ¶¶ 84–92. Before the 

Court is Cincinnati’s Motion to Dismiss pursuant to Federal Rule of Civil Procedure 

12(b)(6). R. 18, Mot. Dismiss. For the reasons discussed below, the Court grants 

Cincinnati’s Motion to Dismiss. The Court finds that the insurance policy does not 

provide coverage for Valley Lo’s losses.

Background

Valley Lo owns and operates the Club. FAC ¶¶ 4–5. Cincinnati is an Ohio

insurance company, with its principal place of business in Ohio, which issued 

commercial property and casualty, policy no. ETD 048 27 80 (the Policy), with an 

effective date of coverage of April 1, 2018. Id. ¶¶ 7, 43. 

I. Policy Language

The Policy includes a “Business Income and Extra Expense” coverage, which 

includes a “Building and Personal Property” coverage. FAC ¶ 46. The Building and 

Personal Property coverage provides that Cincinnati “will pay for direct ‘loss’ to 

Covered Property at the ‘premises’ caused by or resulting from any Covered Cause of 

Loss.” FAC, Exh. A (the Policy) at 33. “Covered Causes of Loss” means a “direct ‘loss’ 

unless the ‘loss’ is excluded or limited in this Coverage Part.” Id. at 35. “Loss” means 

“accidental physical loss or accidental physical damage.” Id. at 68.

2The Court has jurisdiction over this action pursuant to 28 U.S.C. § 1332.

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The Policy also includes a Business Income and Extra Expense Coverage 

whereby Cincinnati:

will pay for the actual loss of “Business Income” [Valley Lo] sustain[s] due to 

the necessary “suspension” of [Valley Lo]’s “operations” during the “period of 

restoration.” The “suspension” must be caused by “direct loss to property at a 

“premises” caused by or resulting from any Covered Cause of Loss.”

The Policy at 48. Similarly, Cincinnati:

will pay for the actual loss of “Business Income” [Valley Lo] sustain[s] due to 

the necessary “suspension” of [Valley Lo]’s “operations” during the “period of 

restoration.” The “suspension” must be caused by direct “loss” to property at 

“premises” which are described in the Declarations and for which a “Business 

Income” Limit of Insurance is shown in the Declarations. The “loss” must be 

caused by or result from a Covered Cause of Loss. 

Id. at 126.

 The Policy also includes a Civil Authority coverage, which extends Valley Lo’s 

Business Income and Extra Expense coverages “to the actual loss of ‘Business 

Income” and necessary Extra Expense [Valley Lo] sustain[s] caused by action of civil 

authority that prohibits access to the ‘premises.’” The Policy at 49. However, two 

conditions must be satisfied: (a) “[a]ccess to the area immediately surrounding the 

damaged property is prohibited by civil authority as a result of the damages; and (b) 

“[t]he action of action of civil authority is taken in response to dangerous physical 

conditions resulting from the damage or continuation of the Covered Cause of Loss 

that caused the damage, or the action is taken to enable a civil authority to have 

unimpeded access to the damaged property.” Id.

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II. COVID-19 and Closure Orders

On March 15, 2020, Valley Lo was notified that an individual who tested 

positive for COVID-19 had dined at the Club on March 5, 6, and 7, 2020. FAC ¶ 56. 

The Club also learned that the individual’s immediate family utilized the Club’s 

facilities on March3, 9, 12, and 14, 2020. Id. On March 16, 2020, a Club employee 

working in the pro shop began experiencing COVID-19 symptoms. Id. ¶ 60.

On March 16, 2020, in response to the COVID-19 pandemic, the Illinois 

Governor issued Executive Order 2020-07, which suspended in-person dining and 

gatherings of 50 or more people. FAC ¶ 34. On March 20, 2020, the Governor issued 

Executive Order 2020-10, which extended Executive Order 2020-7’s suspension of inperson dining and ordered closed all places of public amusement, including country 

clubs. Id. ¶ 35. Through April and May of 2020, the Governor issued additional 

executive orders extending the prohibition of in-person dining and the closure of 

country clubs. Id. ¶¶ 36–39 (all orders are collectively referred to as the Closure 

Orders).

In response to Executive Order 2020-07 and the COVID-19 exposure that 

occurred at the Club, Valley Lo closed the Club, including the restaurant to the public 

on March 16, 2020. FAC ¶ 61. On April 1, 2020, Valley Lo began offering carry-out 

lunch and dinner service, but stopped on April 8, 2020, when a member of its culinary 

staff tested positive for COVID-19. Id. ¶¶ 65–66. Valley Lo alleges that is suffered an 

ongoing loss of business income upon the Club’s closure on March 16, 2020, it incurred 

expenses to disinfect its property, and incurred expenses to disinfect the Club 

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following the April 8, 2020 culinary staff member’s COVID-19 diagnosis. Id. ¶¶ 62–

63, 69. On or about April 8, 2020, Valley Lo filed a claim with Cincinnati regarding 

its lost business income and COVID-19 related expenses, which Cincinnati denied.

Id. ¶¶ 71–72.

Valley Lo then filed its Complaint for declaratory relief (Count I) and breach 

of contract (Count II), individually and on behalf of a class consisting of Cincinnati 

policy holders who made claims to Cincinnati for COVID-19 related losses and whose 

claims were denied by Cincinnati. Cincinnati now moves to dismiss the Complaint 

pursuant to Rule 12(b)(6).

Standard of Review

A motion to dismiss under Rule 12(b)(6) challenges the sufficiency of the 

complaint. Hallinan v. Fraternal Order of Police of Chi. Lodge No. 7, 570 F.3d 811, 

820 (7th Cir. 2009). Under Rule 8(a)(2), a complaint must include only “a short and 

plain statement of the claim showing that the pleader is entitled to relief.” Fed. R. 

Civ. P. 8(a)(2). To survive a motion to dismiss, a complaint need only contain factual 

allegations, accepted as true, sufficient to “state a claim to relief that is plausible on 

its face.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (citing Bell Atl. Corp. v. Twombly, 

550 U.S. 544, 570 (2007)). “A claim has facial plausibility when the plaintiff pleads 

factual content that allows the court to draw the reasonable inference that the 

defendant is liable for the misconduct alleged.” Id. The allegations “must be enough 

to raise a right to relief above the speculative level.” Twombly, 550 U.S. at 555. The 

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allegations that are entitled to the assumption of truth are those that are factual, 

rather than mere legal conclusions. Iqbal, 556 U.S. at 678–79.

Analysis

I. Choice of Law

At the outset, the Court must address a choice-of-law issue. Apparently, the 

Policy does not contain a choice-of-law provision as no party directs the Court to any 

such clause. That said, neither party articulates what law governs, although both 

parties cite Illinois law in their respective briefs. R. 19, Memo. Dismiss; R. 23, Resp.

“Federal courts hearing state law claims under diversity or supplemental 

jurisdiction apply the forum state’s choice of law rules to select the applicable state 

substantive law.” McCoy v. Iberdrola Renewables, Inc., 760 F.3d 674, 684 (7th Cir. 

2014) (internal citations omitted). As the Court sits in Illinois, it looks to Illinois’ 

choice of law rules. Under Illinois law, in the absence of an express choice of law 

provision in an insurance policy, courts apply the “most significant contacts” test. 

Jupiter Aluminum Corp. v. Home Ins. Co., 225 F.3d 868, 873 (7th Cir. 2000). The 

factors considered under the “most significant contacts” test are: “the location of the 

subject matter, the place of delivery of the contract, the domicile of the insured or of 

the insurer, the place of the last act to give rise to a valid contract, the place of 

performance, or other place bearing a rational relationship to the general contract.” 

Id. (international citation omitted). Courts give special emphasis to the location of 

the insured risk. Id.

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Courts, however, “forego [a] choice of law analysis when the parties agree on 

the law that governs a dispute and there is a reasonable relation between the dispute 

and the forum whose law has been selected.” Home Valu, Inc., v. Pep Boys-Manny, 

Moe & Jack of Del., Inc., 213 F.3d 960, 963 (7th Cir. 2000) (internal citation omitted).

Here, Illinois has the most significant contacts in this dispute. And no party contests 

the application of Illinois law. Therefore, the Court finds that Illinois substantive law 

governs the coverage dispute. See Lapham-Hickey Steel Corp. v. Prot. Mut. Ins. Co., 

655 N.E.2d 842, 845 (Ill. 1995)).

II. Contract Interpretation

The standard rules of contract interpretation apply to insurance policies—the 

“primary objective is to ascertain and give effect to the intent of the parties, as 

expressed in the policy language.” Westfield Ins. Co. v. Vandenberg, 796 F.3d 773, 

777–78 (7th Cir. 2015) (internal quotation and citations omitted). “[I]f the terms of 

the policy are susceptible to more than one meaning, they are considered ambiguous

and will be construed strictly against the insurer who drafted the policy.” Pekin Ins. 

Co. v. Wilson, 930 N.E.2d 1011, 1017 (Ill. 2010) (internal quotation and citation 

omitted). However, a policy provision is not ambiguous solely because the parties 

disagree about its interpretation. Founders Ins. Co., v. Munoz, 930 N.E. 2d 999, 1004 

(Ill. 2010).

Under Illinois law, the insured bears the initial burden of demonstrating the 

existence of a claim that falls within the coverage provided by the policy. Addison Ins. 

Co. v. Fay, 905 N.E.2d 747, 752 (Ill. 2009). If the insured establishes that its claim is 

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covered by the policy, the burden shifts to the insurer to demonstrate that a limitation 

or exclusion applies. Id.

III. Business Income and Extra Expense Coverage

Valley Lo asserts under both counts that it is entitled to coverage under the 

Policy’s Business Income and Extra Expense coverage due to the losses incurred as a 

result of the Closure Orders. FAC ¶¶ 86, 91, 97–99, 108–112.

Cincinnati argues that Valley Lo’s claims based on the Policy’s Business 

Income and Extra Expense coverage fail because the Policy does not cover Valley Lo’s’ 

alleged losses. Memo. Dismiss at 6–10. Cincinnati contends that coverage “applies 

only if there has been a direct physical loss or damage to property.” Id. at 6. According 

to Cincinnati, Valley Lo fails to allege “any distinct, demonstrable, physical alteration 

of property at its premises.” Id. at 7. Rather, notes Cincinnati, Valley Lo merely 

alleges that it sustained physical loss to its property because there were two 

individuals at the premises who tested positive for COVID-19 and that civil authority 

orders impacted its operations. Id. Cincinnati insists that “physical loss” and 

“physical damage” to property require a physical alteration of property at Valley Lo’s 

premises, which Valley Lo fails to allege. Id. at 7–8. It also asserts Valley Lo’s “loss 

consists entirely of the economic impact of COVID-19 on its business not because of 

direct physical loss to property, but because it complied with social distancing 

requirements.” Id. at 6. 

As for Valley’s Lo allegations regarding the presence of the virus on its 

premises, Cincinnati posits that no Illinois authority has found that the presence of 

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the virus constitutes direct physical loss to property. Memo. Dismiss at 6–7. To the 

contrary, observes Cincinnati, courts have rejected Valley Lo’s position. Id. at 7–10 

(citing Sandy Point Dental, PC v. The Cincinnati Ins. Co., 488 F. Supp. 3d 690 (N.D. 

Ill. 2020) and other cases).

Not surprisingly, Valley Lo disagrees with Cincinnati’s interpretation of the 

Policy. Valley Lo responds that it adequately alleges a direct accidental physical loss

to property at its premises. Resp. at 10. The Policy does not define the phrases

“accidental physical loss” or “accidental physical damage”, but applying dictionary 

definitions of “accidental”, “physical”, and “loss”, Valley Lo asserts that the plain and 

ordinary meaning of “accidental physical loss” to property encompasses: “the sudden 

inability to use property as a result of physical forces acting on that property” and/or 

“the sudden disappearance or diminution of property’s value as a result of physical 

forces acting on that property.” Id. at 10–12. Thus, an insured, reasons Valley Lo, 

suffers “accidental physical loss” to property when “toxic substances and/or diseasecausing agents unexpectedly contaminate the property, thereby rendering it 

unusable or uninhabitable for safety reasons.” Id. at 12 (citing Studio 417, Inc. v. The 

Cincinnati Ins. Co., 478 F. Supp. 3d 794 (W.D. Mo. 2020) and other cases).

Valley Lo notes that Illinois courts have held that insureds suffered “physical 

loss or damage to” property when toxic substances and/or disease-causing agents 

contaminate the property. Resp. at 14 (citing Bd. of Educ. of Twp. High Sch. Dist. No. 

211 v. Int’l Ins. Co., 720 N.E.2d 622 (Ill. App. Ct. 1999)). Valley Lo contends that 

Cincinnati’s cases are distinguishable. For example, in neither Sandy Point Dental, 

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PC, 488 F. Supp. 3d 690, nor It’s Nice, Inc. v. State Farm Fire and Cas. Co., No. 

2020L000547 (Ill. Cir. Ct. Sept. 29, 2010), did the plaintiffs allege on-premises 

COVID-19 contamination. Id. at 16. 

Alternatively, Valley Lo posits that the Court deny Cincinnati’s motion to 

dismiss because the Policy is ambiguous. Resp. at 20–21. While arguably Cincinnati 

has advanced one reasonable interpretation of the coverage provisions at issue, 

Valley Lo’s interpretation of said provisions is also reasonable, and, accordingly, 

Valley Lo submits the Policy is ambiguous. Id.

The Court begins its analysis as it must, with the Policy. The Policy provides

coverage for a direct “loss,” and defines “loss” as “accidental physical loss or accidental 

physical damage.” The Policy at 33, 68. Valley Lo argues that under the Policy, 

coverage is triggered when, as the insured, Valley Lo incurs a direct physical loss to 

property. See Resp. The Court agrees. However, the Policy does not define “accidental 

physical loss” or “accidental physical damage.” No matter, as the Court may resort to 

dictionary definitions to ascertain the plain and ordinary meaning of words. See Drs. 

Direct Ins., Inc. v. Bochenek, 38 N.E.3d 116, 124 (Ill. App. Ct. 2015) (“Where a term 

in an insurance policy is not defined, we afford that term its plain, ordinary, and 

popular meaning—that is, we look to its dictionary definition.”). Moreover, an 

insurance policy, like any contract, “is to be construed as a whole, giving effect to 

every provision, if possible, because it must be assumed that every provision was 

intended to serve a purpose.” Valley Forge Ins. Co. v. Swiderski Elecs., Inc., 860 

N.E.2d 307, 314 (Ill. 2006) (internal citation omitted). With these basic principles in 

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mind, the Court notes that in the Policy, the terms “loss” and “damage” are modified 

by the words “direct”, “accidental”, and “physical.” The Policy at 33, 68. “Direct” is 

self-explanatory. “Accidental” means “[n]ot having occurred as a result of anyone's 

purposeful act; esp., resulting from an event that could not have been prevented by 

human skill or reasonable foresight.” Accidental, Black’s Law Dictionary (11th ed. 

2019). “Physical” means “of, relating to, or involving material things; pertaining to 

real, tangible objects.” Id. at Physical. Accordingly, any “loss” or “damage” must be 

direct, accidental, and physical.

Furthermore, “loss” seemingly cannot mean the same thing as “damage.” See 

Valley Forge Ins. Co., 860 N.E.2d at 314. “Loss” means “the failure to maintain 

possession of a thing.” Loss, Black’s Law Dictionary (11th ed. 2019). But “damage” 

means “[l]oss or injury to person or property; esp., physical harm that is done to 

something or to part of someone’s body.” Id. at Damage. It is clear that any “direct 

accidental physical damage” must be a physical harm. And, applying the plain and 

ordinary meaning of the phrase “direct accidental physical loss,” the Court finds that 

the Policy require some form of actual physical damage to the insured property to 

trigger coverage.

In Park Place Hosp., LLC v. Cont’l Ins. Co., 2021 WL 3549770, at *4 (N.D. Ill. 

Aug. 10, 2021), a court in this District explained the different between “loss” and 

“damage” and agreed that “the plain wording of the phrase requires either a 

permanent disposition of the property due to a physical change (‘loss’), or physical 

injury to the property requiring repair (‘damage’).” (internal quotation and citation 

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omitted). And the court disagreed with the insured that the policy’s language 

permitted a conclusion that “physical loss” included “loss of use of the property 

without any tangible or concrete loss.” Id. It joined the majority of courts to hold that 

“physical loss” or “physical damage” requires a concrete or tangible loss or damage. 

Id. The Court joins this majority and agrees.3 To conclude otherwise is to ignore the 

plain meaning of the Policy.

The remaining language in the Policy supports this position. Under the Policy, 

an insured must sustain an actual loss of income due to a necessary suspension of its

property during the period of restoration. The period of restoration per the Policy

ends on the earlier of: (i) “[t]he date when the property at the ‘premises’ should be 

repaired, rebuilt or replaced with reasonable speed or similar quality;” or (ii) “[t]he 

date when business is resumed at a new permanent location.” The Policy at 68–69. 

Clearly the Policy contemplates that the insured’s property would need to be repaired, 

rebuilt, or replaced due to the “direct accidental physical loss.” And this language 

“unambiguously requires some form of actual, physical damage to the insured 

premises to trigger coverage.” Sandy Point Dental, PC, 488 F. Supp. 3d at 693; see 

3The Court notes that, after briefing on Cincinnati’s motion was complete, two other courts 

in this District reached the opposite conclusion, which is the minority view in this District. 

See In re Soc’y Ins. Co. COVID-19 Bus. Interruption Prot. Ins. Litig., 521 F. Supp. 3d 729 

(N.D. Ill. 2021); Derek Scott Williams PLLC v. Cincinnati Ins. Co., 522 F. Supp. 3d 457 (N.D. 

Ill. 2021). Valley Lo never filed motions for leave to file supplemental authority to bring these 

decisions to the Court’s attention. No matter, as the Court finds the reasoning of the majority 

view more persuasive.

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also Bend Hotel Dev. Co., LLC v. Cincinnati Ins. Co., 515 F. Supp. 3d 854, 858 (N.D. 

Ill. 2021).

Valley Lo leans heavily on Studio 417, Inc. v. The Cincinnati Ins. Co., 478 F. 

Supp. 3d 794 (W.D. Mo. 2020), among other cases, for support that the coronavirus 

may cause a physical loss to property warranting coverage. Resp. at 12–14. None of 

the cases cited by Valley Lo, however, applied Illinois law. Instead, those courts

applied the law of other states to conclude that as interpreted by those state courts, 

it was at least possible to construe the policy language regarding physical loss of to 

allow coverage even absent a physical alteration if the space was unusable. However, 

the Court finds the reasoning employed by a majority of the courts applying Illinois 

law to have considered the issue more persuasive. See Sandy Point Dental, PC, 488 

F. Supp. 3d at 693; Bend Hotel Dev. Co., LLC, 515 F. Supp. 3d 854 at 858; T & E Chi. 

LLC v. Cincinnati Ins. Co., 501 F.Supp.3d 647, 651–52, (N.D. Ill. 2020).

Valley Lo’s attempt to read ambiguity into the Policy based on its alleged 

interpretation is unconvincing. See Resp. at 20–21. The Court finds Valley Lo’s 

interpretation unreasonable, and just because Valley Lo and Cincinnati disagree 

about the interpretation of the Policy does not render it ambiguous. See Founders Ins. 

Co., 930 N.E. 2d at 1004.

The Court, having found that Business Income requires direct physical loss or 

direct physical damage to property, turns to the Complaint. Valley Lo owns and 

operates a country club which consists of among other things, an 18-hole golf course, 

a fitness center, and several on-site restaurants. FAC ¶¶ 4–5. It alleges that it was 

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required to close after the Governor of Illinois issued the Closure Orders barring onsite services for restaurants and ordering closed all country clubs or social clubs to 

the public. Id. ¶¶ 35, 40. An individual who dined at the Club in March 2020 later 

tested positive for COVID-19 and “shed COVID-19 droplets and/or airborne particles” 

while at the Club. Id. ¶¶ 56–57. Valley Lo alleges that due to COVID-19 and the 

Closure Orders, it suffered the “direct” and “accidental physical loss or accidental 

physical damage” to its on-premises dining areas. Id. ¶¶ 88–89, 100-101.

Notably, nowhere in the Complaint does Valley Lo allege that any of its

property suffered any direct accidental physical loss or direct accidental physical 

damage, a physical alteration to its property, or any loss or damage that was tangible 

or concrete. Instead, Valley Lo alleges that the March 2020 individual’s COVID-19 

droplets transformed the air of the Club and landed on its objects and surfaces. FAC 

¶ 58. This does not translate into a physical alteration, or a tangible or concrete loss 

or damage.

The cases cited by Valley Lo are distinguishable. In U.S. Fid. & Guar. Co. v. 

Wilkin Insulation Co., 578 N.E. 2d 926, 931 (Ill. 1991), asbestos-containing products 

had been installed in the insured’s property which required removal to render the 

property safe again. Similarly, in Bd. of Educ. of Twp. High Sch. Dist. No. 211, 720 

N.E.2d at 623, the insured was attempting to have asbestos-containing building 

materials removed from its buildings. Valley Lo’s attempt to equate asbestos fibers 

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and COVID-19 seem similar falls flat, and it cites no authority in which a court has 

addressed their effect and contamination effect similarly.

Valley Lo also suggests that the COVID-19 droplets at its property rendered 

the Club dangerous or unsafe and unfit for its intended purpose as a restaurant and 

country club, thus triggering coverage. Resp. at 5. The Court disagrees. Other courts 

in this District have soundly rejected the argument that a partial loss to properties 

from loss of use constitutes “direct physical loss” to trigger such coverage. See Sandy 

Point Dental, PC, 488 F. Supp. 3d at 693.

The Court finds, in viewing the allegations of the Complaint in the light most 

favorable to Valley Lo, the non-movant, and drawing all reasonable inferences in its 

favor, that Valley Lo fails to state a cause of action for breach of contract and 

declaratory relief regarding the Business Income and Extra Expense provision.

IV. Civil Authority Coverage

Valley Lo also seeks coverage the Policy’s Civil Authority provision. FAC ¶¶ 

34–40, 88–89, 100–01. Cincinnati argues that civil authority coverage is only 

triggered where there is direct physical loss to property other than the insured’s 

property and access to the insured’s property is prohibited due to a direct physical 

loss. Memo. Dismiss at 13–15. Cincinnati contends that Valley Lo fails to allege that

direct physical loss was present at other property, or the Closure Orders prohibited 

access to the Club, both required by the Policy. Id. at 13–14.

The Court agrees that Valley Lo fails to allege coverage under the Civil 

Authority provision. First, the Complaint fails to allege any damage to other property.

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This failure is fatal to the Complaint. See Sandy Point Dental, PC, 488 F. Supp. 3d at 

694 (finding that the civil authority coverage does not apply because “the complaint 

has not (and likely could not) allege that the coronavirus caused direct physical loss 

to other property”). Second, the Complaint fails to allege that access to the Club was 

denied. True, the effect of the Closure Orders was to restrict access by the public to 

the Club. However, imposing limitations on operations is not the same as prohibiting 

access to the Club.

The Court finds, again, in viewing the allegations of the Complaint in the light 

most favorable to Valley Lo, the non-movant, and drawing all reasonable inferences 

in its favor, that Valley Lo fails to state a cause of action for breach of contract and 

declaratory relief regarding for coverage under the Policy’s Civil Authority provision. 

Conclusion

For the reasons given above, the Court grants Cincinnati’s Motion to Dismiss

[18]. Even though the Court does not see how Valley Lo could cure the deficiencies in 

its first amended complaint, the Court will provide it one opportunity to attempt to 

amend its claims. Therefore, the Court dismisses Valley Lo’s first amended complaint 

without prejudice and directs Valley Lo, if it so chooses, to file an amended complaint 

by 10/21/2021. If Valley Lo does not file an amended complaint, this dismissal will 

automatically convert to a dismissal with prejudice, and the Court will enter 

judgment accordingly.

Dated: September 30, 2021

United States District Judge

Franklin U. Valderrama

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