‘Biggest Trial Lawyer Bonanza in History?’: Pandemic-Related Lawsuits Spike

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To say that COVID-19 has disrupted American life would be a gross understatement. So far, the pandemic has resulted in unprecedented upheaval: over 200,000 deaths in the U.S. so far (the actual toll will be much higher), the loss of 22 million jobs (less than half have since been regained), and over 5,000 pandemic-related lawsuits filed nationwide. Some of the allegations made in these pandemic-related lawsuits include:

  • Misclassification. Employees are bringing legal action against employers who allegedly avoided paying them overtime by mistakenly putting them on salary while they worked from home, incorrectly describing their job duties as exempt. The plaintiff in one such lawsuit alleges his former employer, HT AirSystems of Florida, classified him as an employee exempt from overtime. He claims his former employer paid him a regular salary (absent overtime) even though he routinely worked 50-60 hours per week and performed many nonexempt duties.
  • Breach of contract. Disgruntled ticketholders are filing breach-of-contract lawsuits against event and ticketing companies, alleging they illegally failed to refund payments made for canceled events. SeatGeek Inc. is being sued in federal court for rescinding its money-back guarantee of a full cash refund after the pandemic led to worldwide cancellations of live events. According to the complaint, SeatGeek prominently featured its refund policy on its website and in marketing materials until COVID-19, when the company quietly and retroactively changed its terms “in the midst of the greatest public health and economic crisis in living memory.”
  • Business interruption. Restaurants in Florida and New Jersey have brought federal class-action lawsuits against insurer Chubb Ltd. demanding coverage for business income lost due to the pandemic. Similar lawsuits being filed by numerous small businesses across the country assert that the presence of coronavirus in or around a property constitutes physical damage under the terms of their business insurance policies. Although none of the policies at issue contain a communicable disease or virus exclusion, the insurers argue COVID-19 does not constitute physical damage, and therefore, coverage was not triggered.
  • Noncompliance with health guidance. Chicago McDonald’s workers and their families have filed a somewhat unique class-action lawsuit against the fast-food chain in Cook County Circuit Court. The complaint does not seek monetary damages for sick staff. Instead, it demands that McDonald’s comply with mandatory health guidance by providing employees with clean facemasks, gloves and hand sanitizer. In June, Judge Eve Reilly ordered several area McDonald’s to implement new safety procedures for training, social distancing and masks. She also underscored two “serious failures” in the company’s processes: the failure to enforce the proper wearing of masks consistently, and training managers that employees don’t have stay six feet apart as long as they’re not closer to one another for more than 10 minutes.
  • Civil rights. In February, the City of Costa Mesa, Calif., filed a civil rights lawsuit against the federal government, several government agencies, the state of California and the governor’s Office of Emergency Services. Costa Mesa brought the suit after being told that 50 detainees in federal quarantine due to coronavirus exposure were to be transferred from Travis Air Force Base to the Fairview Development Center in Costa Mesa within three days. The lawsuit argued that the center was not suitable to house COVID-19 patients because it was “dilapidated” and is surrounded by residential neighborhoods, posing a severe risk to public health. On February 28, a federal judge granted Costa Mesa’s request to block the transfer, and the government subsequently vacated the plan.

Although many organizations have called for legal protections from such pandemic-related litigation, Congress has yet to agree to liability protections for businesses, schools, healthcare providers and nonprofits. As a result, most remain at risk for civil lawsuits filed by employees and customers claiming that they contracted the coronavirus while on their premises. While at least seven states have enacted limited liability protections for businesses (with exceptions for actual malice or deliberate wrongdoing), opponents of such liability waivers say they permit companies to fail to take proper precautions to prevent further spread of the virus.

“When you have these kind of immunity statutes, what you are doing is creating a ‘wrongdoer protection act,’” New York plaintiffs’ attorney Richard Bell said in a recent Pew Charitable Trusts report. “When you protect wrongdoers, you encourage wrongdoing. How about the businesses comply with guidelines, comply with state and local laws and they won’t have to worry about lawsuits in the first place.”

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