Skip to content

Search

Latest Stories

Former AAHOA chairman suing insurance company for COVID-19 losses

The lawsuit claims the company is not acting on a business interruption insurance claim

Former AAHOA chairman suing insurance company for COVID-19 losses

A FORMER AAHOA chairman and California hotelier has filed suit against his insurance company, for denying coverage on his business interruption insurance policy in connection with losses incurred from the COVID-19 pandemic. It’s a situation in which many other hotel owners with similar policies find themselves, Tarun Patel and his attorneys said.

Patel is head of Pacific Lodging Group, plaintiff in the lawsuit against Sequoia Insurance Co. The lawsuit, filed in Superior Court of the State of California in Santa Clara, California, claims Sequoia has not issued a coverage determination even though Patel filed his claim several months ago. The insurance company also has not issued a denial letter or request for information or taken any other action on the claim related to losses at Patel’s Bodega Coast Inn & Suites in Bodega Bay, California.


“We consistently paid a costly premium for comprehensive insurance from Sequoia for years,” Patel said. “Now we need Sequoia to step up and fulfill their obligation so that we can recover. Insurance companies must honor their contracts and do their part to help the country recover from this disaster, just like everyone else. I am hopeful that the courts will agree.”

Patel, who served as AAHOA chairman from 2009 to 2010 and who currently serves on the board of the American Hotel and Lodging Association, said the pandemic related travel and activity prohibitions have been particularly hard on hotels, particularly small, family-owned hotels.

“Across the country, many businesses that thought they were being responsible by securing and paying premiums for business interruption coverage are now facing mounting costs resulting from their insurance company’s failure to cover losses arising from COVID-19,” said as statement from the law firms representing Patel and Pacific Lodging Group, Cohen Milstein Sellers & Toll and Gibbs Law Group.

The firms are reviewing potential claims from hotels, restaurants and small business owners across the country that have been affected by insurance companies’ refusal to pay.

“Once again, we see another insurer ignoring their financial responsibility and refusing to pay their contractually agreed-upon coverage,” said Geoffrey Graber, partner at Cohen Milstein Sellers & Toll and a member of the firm’s COVID-19 Business Interruption Insurance Coverage Task Force. “Bodega Coast Inn & Suites is the type of small business that we need to protect during this challenging time. Sequoia’s failure to honor its obligations have put the livelihoods of so many people at risk for their own benefit.”

Sequoia is not the only insurance company denying claims related to the pandemic, said Eric Gibbs, a partner at Gibbs Law Group and also a member of the task force.

“Sequoia is falling in line behind other insurance providers in allowing their policyholders to be financially decimated, while continuing to grow their profit margins,” Gibbs said. “We seek to prevent the demise of the hotel industry and other small businesses who paid Sequoia’s premiums yet are being denied coverage.”

Current business interruption insurance policies may not cover a pandemic, Rahul Patel, managing partner at the Patel|Gaines law firm in San Antonio, Texas, said previously.

“I think that there are probably some strong legal provisions that state that your insurance should or does cover this type of situation. But the flip side to that is, whether it says that or not, or whether it’s covered or not, isn’t really the situation. The situation is how long is it going to take for you to find relief under that?” he said. “Do you believe that insurance companies are going to bend over and say ‘Hey, $20,000, let’s just pay the claim.’ No, because there’s going to be thousands of claims. I told someone that it might not be a bad angle to pursue, but if you’re relying on that to come in next month then you’ve got a problem.”

More for you

Marriott Outdoor Collection

Marriott unveils 'Outdoor Collection'

Summary:

  • Marriott launches Outdoor Collection and Bonvoy Outdoors platform.
  • First two brands are Postcard Cabins and Trailborn Hotels.
  • Platform features 450+ hotels, 50,000 homes and activities.

MARRIOTT INTERNATIONAL RECENTLY launched the brand “Outdoor Collection by Marriott Bonvoy” and introduced “Marriott Bonvoy Outdoors,” a digital platform that lets travelers plan trips by destination or activity. The first two brands in the Outdoor Collection are Postcard Cabins and Trailborn Hotels.

Keep ReadingShow less
Peachtree adds six hotels to its third-party management platform
Photo credit: Peachtree Group

Peachtree picked to manage six hotels

Summary:

  • Peachtree adds six hotels to third-party platform.
  • Five are owned by La Posada Group, one by Decatur Properties.
  • Third-party portfolio totals 42 hotels.

PEACHTREE GROUP’S HOSPITALITY management division added six hotels to its third-party management platform. Five are owned by La Posada Group LLC and one by Decatur Properties Holdings.

Keep ReadingShow less
AHLA Foundation scholarships

AHLA Foundation awards $710K in scholarships

Summary:

  • AHLA Foundation distributed $710,000 in scholarships to 246 students.
  • Nearly 90 percent of recipients come from underrepresented communities.
  • The foundation funds students pursuing education and careers in the lodging sector.

AHLA FOUNDATION DISTRIBUTED $710,000 in academic scholarships to 246 students at 64 schools nationwide for the 2025–2026 academic year. Nearly 90 percent of recipients are from underrepresented communities, reflecting the foundation’s focus on expanding access to hospitality careers.

Keep ReadingShow less
U.S. government shutdown
Photo by Kevin Dietsch/Getty Images

Congressional deadlock shutters government

Summary:

  • The U.S. government shut down at midnight after Congress failed to agree on funding.
  • About 750,000 federal employees will be furloughed daily, costing $400 million.
  • Key immigration and labor programs are halted.

THE FEDERAL GOVERNMENT shut down at midnight after Republicans and Democrats failed to agree on funding. Disputes over healthcare subsidies and spending priorities left both sides unwilling to accept responsibility.

Keep ReadingShow less
U.S. government shutdown 2025 news
Photo by Andrew Harnik/Getty Images

Trump, Congress face shutdown deadline

Summary:

  • President Donald Trump will meet Congress as a shutdown looms.
  • Democrats say they are ready to negotiate a bipartisan deal.
  • Thousands of federal jobs and the U.S. travel economy are at risk if a shutdown occurs.

PRESIDENT DONALD TRUMP will meet Congressional leaders on Monday after Senate Democrats rejected a Republican stopgap spending bill to fund the government until Nov. 21. The U.S. Travel Association recently warned a government shutdown could cost the travel economy $1 billion a week.

Keep ReadingShow less