COVINGTON SPECIALTY INSURANCE COMPANY v. OMEGA RESTAURANT & BAR, LLC
COVINGTON SPECIALTY INSURANCE COMPANY v. OMEGA RESTAURANT & BAR, LLC
July 20, 2026·24-1364·Panel Decision·BERNER·By James Taylor
The United States Court of Appeals for the Fourth Circuit remanded an insurance coverage dispute to the district court. The appellate court determined that a jurisdictional question regarding mootness required factual development before the merits could be addressed.
Omega Restaurant and Bar faced a lawsuit from professional models over unauthorized use of their images. Covington Specialty Insurance Company sued Omega seeking a declaration that it had no duty to defend or indemnify Omega under their policy. The district court granted summary judgment to Covington.
The court’s reasoning
The court held that because Covington raised the mootness argument for the first time on appeal, there were no findings of fact or conclusions of law on the issue for review. The record was undeveloped regarding whether a live case or controversy continued to exist after the underlying lawsuit settled.
What it means going forward
The district court must determine if a live case or controversy exists before the insurance coverage dispute can proceed.
