In a significant ruling, the Fourth Circuit Court of Appeals affirmed a lower court's decision that denied Golden Corral's request for relief from a previous judgment regarding its insurance claims. This case, Golden Corral Corporation v. Illinois Union Insurance Company (Docket No. 25-1682), centers on whether Golden Corral's insurance policy covers losses incurred due to COVID-19-related government mandates. The outcome affects not only Golden Corral but potentially other businesses facing similar insurance disputes.
The case began when Golden Corral, a popular buffet restaurant chain, sought coverage for losses resulting from state-mandated closures during the COVID-19 pandemic. The company claimed that its property insurance policy with Illinois Union Insurance Company should cover these losses. However, the district court ruled in September 2021 that the policy did not provide such coverage, leading to Golden Corral's appeal.
Golden Corral operates numerous restaurants across the United States and is known for its buffet-style dining. The company faced significant financial losses when North Carolina's Governor ordered the closure of indoor dining to mitigate the spread of COVID-19. In response, Golden Corral filed a claim with Illinois Union for coverage of these losses. When the claim was denied, the company took legal action, seeking a declaration that the losses were covered under its insurance policy.
The dispute escalated when Illinois Union removed the case from state court to federal court, arguing that the COVID-19 virus did not cause physical damage to property, which is a requirement for coverage under the policy. The district court agreed, dismissing Golden Corral's case with prejudice. Golden Corral then filed a motion for relief from the judgment under Federal Rule of Civil Procedure 60(b)(6), citing a subsequent ruling by the North Carolina Supreme Court in a similar case, North State Deli v. Cincinnati Ins. Co., which found that such losses were covered under a different policy.
In its ruling on July 15, 2026, the Fourth Circuit upheld the district court's decision, stating that the lower court did not abuse its discretion in denying Golden Corral's motion. Judge Berner, writing for the court, emphasized that while the North State Deli ruling diverged from the earlier decision, it did not constitute the extraordinary circumstances required for Rule 60(b)(6) relief. The court noted, "A mere change in decisional law—without more—does not provide a basis for Rule 60(b)(6) relief."
The ruling highlighted the importance of finality in legal judgments. The court explained that allowing a change in law to reopen a case could disrupt the legal system's stability. The judges pointed out that Golden Corral's case and North State Deli, while both involving insurance claims related to COVID-19, were fundamentally different in terms of the parties involved and the specifics of the insurance policies.
As a result, the Fourth Circuit concluded that Golden Corral failed to demonstrate that the North State Deli ruling created extraordinary circumstances justifying relief from the prior judgment. The court affirmed the district court's decision, emphasizing that the timing of the North State Deli ruling did not warrant reopening Golden Corral's case.
The implications of this ruling are significant for businesses across the country. Many companies have faced similar challenges in claiming insurance coverage for pandemic-related losses. This decision reinforces the notion that changes in state law or court decisions do not automatically provide grounds for reopening closed cases. It also underscores the need for businesses to carefully consider their insurance policies and the potential limitations they may contain.
Looking ahead, Golden Corral may have limited options for further legal recourse. The court's decision is a final ruling on the matter, and while there could be other related cases pending, the specific issues addressed in this case have been conclusively determined. Businesses in similar situations will need to navigate their insurance claims with the understanding that the legal landscape surrounding pandemic-related losses remains complex and challenging.