Are businesses in danger of coronavirus lawsuits as they reopen?
- Republicans want to insulate businesses against lawsuits from employees and customers who get the coronavirus as states begin reopening their economies.
- There have been few coronavirus-related personal injury or medical malpractice lawsuits to date, according to one analysis.
- These lawsuits may be difficult to win even without additional protections.
Another round of coronavirus relief for Americans may hinge on extra legal protections for businesses.
Some business owners fear customers and employees may sue if they were to contract Covid-19 as retail shops, restaurants and bars gradually begin reopening in many states.
Senate Majority Leader Mitch McConnell, R-Ky., said a wave of lawsuits against business owners could lead to a "second pandemic." He and other Republicans are pushing for extra liability protections, absent which there will be a slower economic recovery, they say.
But the anxiety may be somewhat misplaced, according to opponents of such a new rule, which they believe may promote lax workplace safety standards and lead more workers to stay home.
For one, there hasn't been evidence of mounting coronavirus-related lawsuits to date, and such cases would be challenging to win, they said.
"It's a big concern [for business owners]," Richard Bell, a personal injury and medical malpractice trial attorney based in New York, said of lawsuits. "And it's unfounded."
Congress has passed four laws since early March to help address the financial impact of the coronavirus on Americans.
The largest, the $2.2 trillion CARES Act, expanded unemployment benefits, sent one-time stimulus payments of up to $1,200 to individuals and created a forgivable loan program for small businesses.
Republicans and business groups are pressing Democrats — who want to boost aid for state and local government, among other things — for concessions around business liability in another round of financial relief.
"It's clear there's a groundswell of concern," particularly among small businesses, said Harold Kim, president of the Institute for Legal Reform at the U.S. Chamber of Commerce, a business trade group.
"There is this hanging cloud of liability," he said.
The data do not yet appear to bear out a surge in claims.
Just 45 of the 1,018 coronavirus-related lawsuits as of May 13 were personal injury or medical malpractice cases against a business, according to Reuters, citing an analysis conducted by the law firm Hunton Andrews Kurth. Of those, more than half were against Princess Cruise Lines.
"Those cases haven't materialized and I doubt they will," David Vladeck, a professor at the Georgetown University Law Center, testified on Tuesday during a Senate hearing on corporate liability during the coronavirus pandemic.
It would be difficult to build a successful case even without additional protections for business owners, Bell said.
A customer generally must prove both negligence and causation on the part of the business owners for a court to award damages, he said. A worker only has to prove causation in a workers' compensation court to be awarded damages, he said.
In the context of Covid-19, that would mean customers showing that a business owner did not take appropriate precautionary measures, such as disinfecting surfaces, enforcing social distancing or requiring employees to wear masks, Bell said.
Further, plaintiffs would have to prove they got the coronavirus from the place of business — which could be especially difficult given the long incubation period for the virus, he said.
"That's going to be an extremely high bar," Bell said. "And because of that, I think this is a distraction. It's not a real issue."
Any damages may be covered by liability insurance policies business owners have, he said.
Many attorneys representing plaintiffs in these types of lawsuits typically bring a high volume of cases and push for monetary settlements instead of a court trial, Kim said.
"We think that'll be a similar playbook the organized plaintiff's bar will probably use [with coronavirus claims]," he said.
Additional litigation protections may lead to a lack of safety procedures among businesses who feel they're insulated from legal attack, according to opponents of such legislation. And employees may be tempted to try staying home more as a result, they said.
"When you start giving immunity to businesses for wrongdoing, you start encouraging the wrongdoing," Bell said.
Biden invokes Defense Production Act to boost baby formula manufacturing to ease shortage
Here's what Walmart, Target, Home Depot and Lowe's tell us about the state of the American consumer
Why Tesla was kicked out of the S&P 500's ESG index
Dow drops 1,100 points for its biggest decline since 2020 as the sell-off on Wall Street intensifies
Jim Cramer: Here's how we're approaching the gut-wrenching market sell-off