As phased reopening plans are initiated across the country, many business owners are fearful that reopening may bring with it the possibility of significant liability exposure for COVID-19 related lawsuits. Businesses already feeling the impact of a national economic crisis could face an even more devastating financial impact absent some type of protection. It is inevitable that members of the public will continue to contract COVID-19, despite the precautionary measures in place and those contemplated by businesses that have yet to open. Many argue that in order to seriously consider reopening, businesses must be afforded some legal certainty that they will not face a flood of lawsuits from individuals that contract the virus. While it may be difficult for a plaintiff to ultimately prove that they contracted COVID-19 from a particular business, rather than from some other source, the costs associated with defending such lawsuits could place some businesses in financial jeopardy. In an effort to address these concerns and provide businesses with the confidence to reopen, a growing number of states have considered legislation aimed to immunize companies in various sectors from liability for potential lawsuits by individuals that contract COVID-19.

In the early stages of the pandemic, many states granted immunity to health care providers through legislation or executive order. More recently, states have both considered and enacted legislation that extends immunity to a much broader scope of businesses and other entities. For instance, North Carolina has enacted legislation offering limited immunity from civil liability for essential businesses in the state with respect to claims by customers and employees for injuries or death alleged to have been caused as a result of contracting COVID-19.[1] Emergency response entities are also afforded this immunity in North Carolina. There are, however, limitations to the immunity provided. There is no immunity if the injuries or death were caused by an act or omission of the essential business or emergency response entity that constituted gross negligence, reckless misconduct, or intentional infliction of harm.

Oklahoma offers even broader protection, as its recent legislation affords anyone who conducts business in the state immunity from liability in any civil action involving allegations of exposure or potential exposure to COVID-19 if the act or omission alleged to violate a duty of care was in compliance or consistent with federal or state regulations, executive orders, or guidance applicable at the time of the alleged exposure.[2] If two or more sources of guidance are applicable to the conduct or risk at the time of the alleged exposure, the person or business will not be liable if the conduct was consistent with any applicable guidance.

Similarly, Wyoming has passed legislation that provides immunity from liability for any health care provider or other person, including a business entity, who in good faith follows the instructions of a state, city, town, or county health officer or who acts in good faith in responding to the public health emergency.[3] Immunity does not, however, apply to acts or omissions that constitute
Continue Reading State Legislation to Immunize Businesses from Liability for Contraction of COVID-19

For all Americans, the beginning of June brings with it the lifting of stay-at-home orders and the reopening of the economies of every state. Yet, many experts warn that it could be months or even years before everyday life returns to normal. While the “new” American way of life is uncertain at best, recent trends in litigation provide some insight into the types of claims that are likely to arise out of the COVID-19 pandemic. One trend highlights an emergence in litigation involving consumer protection statutes and COVID-19.

Unfair and Deceptive Acts and Practices (UDAP) statues exist in all fifty states and the District of Columbia to protect consumers from unfair, deceptive, predatory and unscrupulous business practices.[1]  However, there exists little uniformity among UDAP statues. Some states such as Massachusetts provide for liberal coverage, extensive damages, and attorneys’ fees. Other states, such as Rhode Island, exempt most lenders and creditors from UDAP coverage.[2] By way of example, Massachusetts’ UDAP statute, known as “Chapter 93A” broadly prohibits “unfair methods of competition and unfair or deceptive acts or practices in the conduct of any trade or commerce.”[3] Chapter 93A Section 9 provides for a private right of action for a claimant who is a consumer and Chapter 93A Section 11 provides for a private cause of action for an entity engaged in trade or commerce.[4] The Massachusetts UDAP statute provides for actual damages, multiple damages for knowing or willful violations, and attorneys’ fees to a prevailing claimant.[5]

In comparison, California has two UDAP statutes. First, California’s Unfair Competition Law, prohibits any unlawful, unfair or fraudulent business practice, as well as depictive or misleading advertising.[6] Though the Unfair Competition Law does not exempt particular businesses, consumers may not seek damages or multiple damages and are limited to restitution.[7] Private causes of action under California’s Unfair Competition Law are also limited to consumers who have “lost money or property.”[8] California’s other UDAP statute is the Consumers Legal Remedies Act, California Code sections 1750-1784.[9] The Consumer Legal Remedies Act applies to consumer transactions involving the “sale or lease of goods or services.”[10]

In addition to general provisions that prohibit unfair or deceptive acts, many UDAP statues give the attorney general or a state agency authority to adopt rules and regulations to enforce the act. For example, Massachusetts’ Chapter 93A provides that “[t]he attorney general may make rules and regulations interpreting the provisions of subsection 2(a) of this chapter.”[11] As such, on March 20, 2020, Massachusetts Attorney General Maura Healey announced an emergency regulation banning price gouging of essential products and services in light of the COVID-19 pandemic.[12] Attorney General Healey’s amendment sought to supplement Massachusetts’s Chapter 93A statute, which previously regulated only the sale of gasoline and petroleum.[13] The amendment now prohibits price gouging of all essential goods necessary to prevent the spread of the pandemic (e.g., masks, soap and hand sanitizer). By contrast, California’s Unfair Competition Law does not provide a
Continue Reading Consumer Protection in the Age of COVID-19

In our 240+ year history as a country, we have endured numerous tribulations that have in some way, threatened our way of life. The COVID-19 outbreak has forced us to engage in new behaviors, including social distancing and the consistent use of face masks outside of our homes. Moreover, several companies are working tirelessly to develop potential treatments for a virus that has infected approximately 1.25 million Americans and killed approximately 75,670.[1] Among other efforts, entities are repurposing equipment and physicians are prescribing medication for “off-label use.” Surgeon General Jerome Adams has even gone so far as to compare the COVID-19 outbreak to national emergencies like Pearl Harbor and the September 11, 2001 attack on the World Trade Center.

Indispensable to facing these challenges are private-sector entities. World War II is an excellent example, during which President Franklin Roosevelt declared, “[p]owerful enemies must be out-fought and out-produced.” Shortly after the attack on Pearl Harbor, many manufacturers were repurposed to manufacture war items such as aircraft, aircraft engines, trucks, and tanks. Though a pandemic is certainly different than a war, several companies have altered their normal courses of business to help contribute towards the collective fight against COVID-19. Today, the businesses supporting efforts to curb COVID-19 include pharmaceutical companies, medical device companies, medical technology companies, and more. Despite their good faith contributions, which include activities such as repurposing equipment and medication for “off-label” use, these companies will almost certainly face litigation related to the products they have manufactured in an effort to combat the crisis we face today. Nonetheless, companies may be insulated from liability pursuant to the Public Readiness and Emergency Preparedness Act (“PREP”), if they meet certain criteria.

PREP, signed into law in 2005, authorizes the Department of Health and Human Services (“HHS”) to issue a declaration that provides immunity from liability for entities and/or individuals involved in the development of “countermeasures” meant to fight a public health emergency. On March 10, 2020, the HHS issued a declaration providing “liability immunity for activities related to medical countermeasures against COVID-19,” absent willful misconduct (“COVID-19 Declaration”). Entities/individuals covered under the COVID-19 Declaration (“Covered Persons”) include those involved in the following activities: manufacturing, testing, development, distribution, administration, prescription and/or use of “Covered Countermeasures.”[2]

“Covered Countermeasures” under the COVID-19 Declaration

Certain products fall under the “Covered Countermeasures” category. Covered Countermeasures include:

  1. Qualified pandemic or epidemic products;
  2. Security countermeasures[3]; or
  3. Drugs/products authorized for emergency use by the Food and Drug Administration (“FDA”).

Qualified Pandemic or Epidemic Products

To qualify as a qualified pandemic or epidemic product, the drug, device, or biological product must be approved or cleared by the FDA, licensed under Section 351 (42 U.S.C. § 262) of the Public Health Services Act (“PHS Act”) as a biological product, or authorized for emergency use by the FDA.

In addition to the one of the foregoing prerequisites, the drug, device, or biological product must be:

  1. Manufactured, used, designed, developed, modified, licensed or procured to diagnose, mitigate, prevent, treat, or cure


Continue Reading The PREP Act and COVID-19

Partner Jeff McLucas explores Employment Issues in the Age of Coronavirus. For more information, we encourage you to contact Jeff and visit the Employment Litigation section of the MG+M website. 

COVID-19 has impacted the entire planet and the daily lives of all. The pandemic has turned our valued first responders into heroic warriors on the front lines of the battle against the virus. COVID-19 has wreaked a tragic toll upon the population, taking lives and destroying families. At the micro-level, the Coronavirus has turned the incidents of daily life into a herculean task. Social distancing requirements, stay-at-home orders, the closures of schools, businesses and places of social gathering and recreation, restricted travel and limited public transportation have completely disrupted the daily routines and habits of everyone.

Beyond the obvious health related issues, the initial impact of COVID-19 was widely felt through the closures of schools and the closure or severe operational limitations on government and private businesses. Closures, layoffs, furloughs and other austerity measures have become the rule and not the exception. The closures or limited operations of courts both state and federal as well as the disruption to the functioning of law firms may have slowed or delayed various civil employment actions ranging from unemployment claims to discrimination charges to cases under the federal Worker Adjustment and Retraining Notification Act (“WARN”). However, the litigation of such claims by employees is inevitable through individual suits and class actions.

Multiple complaints relating to Coronavirus workplace exposure have been filed with the United States Occupational Safety and Health Administration (“OSHA”). OSHA has issued advisory guidance with recommendations for the workplace and descriptions of health and safety standards including how existing regulations apply to the circumstances created by the COVID-19 pandemic. OSHA issued an interim enforcement response plan for OSHA Area Offices and compliance safety and health officers for handling complaints and reports of Coronavirus. An array of OSHA guidance is available at www.osha.gov.

Like OSHA, the United States Equal Employment Opportunity Commission (“EEOC”) has issued a variety of publications relating to COVID-19, available on its website: www.eeoc.gov. The EEOC emphasizes that despite the closure of its physical offices to the public, the agency remains “virtually” open and accessible by phone and through the EEOC’s website.

The remote work environment fashioned by private and public employers alike in response to the Coronavirus does not mean a suspension of discrimination and equal opportunity laws. There are large, multi-state employers actively seeking to hire tens of thousands of workers to adjust to the overwhelming increase in e-commerce demands. Equal opportunity laws that apply to the hiring process remain in effect. Physical workplace environments already complicated by the internet and smartphones have evolved into virtual workspaces where electronic harassment and discrimination remain a constant issue for employers to monitor.

With reports of new infection rates slowing and evidence of some states of “flattening of the curve,” plans for and initial steps of easing back of restrictions are now evolving and taking place. Following measures taken
Continue Reading To Work Or Not To Work…That Is The Question.

The COVID-19 crisis has had an impact on every court across the nation, both at the state and federal levels, postponing and delaying countless civil litigation hearings and trials. There is still a great deal of uncertainty as to when social distancing guidelines will be relaxed and when states will begin to resume normal business activities. The continued postponement of hearings and trials will result in a tremendous backlog of cases vying for the attention of the courts, as litigators across the nation do their best to zealously advocate for their clients.

As this country battles the continued wave of COVID-19 cases and prepares for the possibility of a second wave of COVID-19 infections in the United States at some point in the not so distant future, litigation has already commenced as a result of the COVID-19 pandemic.

Princess Cruise Lines

At least a dozen lawsuits have been filed against Princess Cruise Lines as a result of passengers affected by the COVID-19 outbreak, and that number continues to climb.

On March 7, 2020, Plaintiffs Ronald Weissberger and Eva Weissberger filed suit in the United States District Court for the Central District of California, alleging negligence and gross negligence by the Defendant, Princess Cruise Lines Ltd., for its “lackadaisical approach” to the COVID-19 pandemic. The Complaint detailed that one of Princess Cruise Lines’ ships, the Grand Princess, departed out of San Francisco on February 21, 2020, and returned to Oakland on March 4, 2020, where it was forced to dock until all passengers could be moved to military bases for quarantine.

On March 13, 2020, Plaintiffs Brian Sheedy and Melanie Sheedy filed an identical complaint against Princess Cruise Lines Ltd., also in the United States District Court for the Central District of California.

Under California law, the elements that must be met to show negligence are “(1) defendant’s obligation to conform to a certain standard of conduct for the protection of others against unreasonable risks (duty); (2) failure to conform to that standard (breach of duty); (3) a reasonably close connection between the defendant’s conduct and resulting injuries (proximate cause); and (4) actual loss (damages).” Corales v. Bennett, 567 F.3d 554, 572 (9th Cir.2009) (quoting McGarry v. Sax, 158 Cal.App.4th 983, 994, 70 Cal.Rptr.3d 519 (2008); Lawman v. City & Cty. of San Francisco, 159 F. Supp. 3d 1130, 1152 (N.D. Cal. 2016).

According to the Weissberger and Sheedy Complaints, none of these Plaintiffs have tested positive for COVID-19. The only alleged damages include exposure to the risk of immediate physical injury, emotional distress and trauma from the fear of developing COVID-19. A cause of action for negligence requires damages in the form of “detrimental physical changes to the body” and this physical injury “for the purposes of parasitic emotional distress damages required actual harm.” Macy’s California, Inc. v. Superior Court, 41 Cal. App. 4th 744 (1995). A plaintiff must prove detrimental change to his or her body to be able to recover for parasitic emotional
Continue Reading COVID-19 Litigation – Fear of Injury and Emotional Distress Claims