For many in the retail and hospitality industry, business is paused by the spread of the novel coronavirus, awaiting word that it is safe to resume. Other essential businesses that avoided complete shutdown still face significant pandemic-related disruptions. Now more stores are gradually beginning to reopen with the prospect of returning to some semblance of “business as usual.” But, as they do, measures should be taken to address another anticipated crisis: a wave of COVID-19 exposure claims in the courts.
In part, this potential litigation is the logical result of an increase in human contact as restrictions lift and people return to stores and restaurants. When this occurs, people diagnosed with COVID-19 (or their families) will seek to hold liable the businesses where they claim they contracted the virus. Thus, many of the principles that help companies thrive in the best of times will become even more critical as the pandemic continues to play out.
Ways COVID-19 Claims Could Play Out
As of this writing, court dockets reflect only a few COVID-19 case filings. It is, therefore, too soon to tell how these types of cases will fare in the courts. But exposure claims are nothing new. Reviewing past infectious disease cases is instructive, providing a glimpse into how current and future COVID-19 claims may ultimately unfold. For example, cases involving exposure to tuberculosis or valley fever (a fungal infection) include allegations centered around a defendant’s failure to warn of the possibility of contracting an illness, failure to employ adequate controls to prevent transmission, and failure to prevent employees that displayed symptoms of an ailment from infecting others.
Many COVID-19 claims will likely be similar. It will not be surprising to see, for instance, cases about a restaurant’s failure to mitigate transmission among its employees, customers, or the general public; a retailer’s failure to warn customers of risks that it either knew or should have known about; or vicarious liability stemming from an employee’s careless decision to work despite displaying COVID-19 symptoms.
To help forestall widespread litigation, some states have already passed laws enacting certain COVID-19 business immunities. Legislation in California and in other states is still evolving. Federal immunities may even be in the works in Congress. Nevertheless, no one should expect absolute immunity. Immunity is unlikely to protect companies from liability for gross negligence, recklessness, or intentional harm. Thus, COVID-19 plaintiffs may simply “plead around” negligence and accuse defendants of reckless or intentional wrongdoing instead. For example, a plaintiff may assert that a company was reckless because it failed to enact adequate procedures to prevent COVID-19 transmission, despite well-publicized standards.
Naturally, causation will be a primary line of defense and one on which many in the industry already seem to be relying. Yet defenses centered around causation will be costly and are not guaranteed. First, they will require efforts like contact tracing, social media analysis, and other investigation into where else a plaintiff was and who else a plaintiff was near. Second, many defenses will require the retention of experts that are likely to include epidemiologists, infectious disease specialists, and industrial hygienists. Third, to prevail, it is unlikely that a COVID-19 plaintiff will be required to rule out every other possible means for contracting the virus. Rather, plaintiff experts will probably rely on a “reasonable degree of medical certainty” standard. Defendants could then essentially be tasked with establishing other viable ways a plaintiff may have contracted the virus, and how potential exposure at a defendant’s premises was limited or non-existent. As litigation in this area continues to evolve, so too will strategies for anticipating and handling these claims.
Initial Tips For Venues Opening-up
As with other liability issues, initial steps for addressing anticipated COVID-19 claims must include implementing proper policies and procedures. Adopting protocols that protect employees and customers from exposure and transmission is key. Practices to consider include:
- Follow (or exceed) industry and CDC standards for hygiene, sanitation, and safety.
- Follow (or exceed) local, state, and federal prevention guidelines and recommendations.
- Display signs that warn about COVID-19 risks and encourage practices that limit person-to-person contact and promote social distancing (e.g. employees wearing masks, mobile orders available, curbside pickup made easy).
- Develop and implement investigation procedures for all potential COVID-19 related claims, including workers’ compensation and liability.
- Retain documents that confirm enforcement of the daily precautions, policies, and procedures in place.
A few words on COVID-19 waivers. Their enforceability is still up in the air and will likely depend on each jurisdiction’s determination about whether they violate public policy. Nevertheless, venues that routinely use liability waivers should consider creating ones for COVID-19 to provide an additional layer of protection for the business and an increased level of awareness for its customers. To avoid uncertainty, this waiver should be on a form that is separate from any existing release so that it remains conspicuous. Additionally, it should: (1) be specifically tailored to the business; (2) include a choice of law provision with a connection to the venue’s location; (3) cover the release of negligence claims but not reckless or intentional misconduct; (4) incorporate a discussion about the inherent risks of COVID-19 to the particular industry; and (5) identify what preventative measures the company is taking to help protect against transmission.
Of course, not everything related to COVID-19 claims can be anticipated. The retail and hospitality industry will need to adjust to changes. Still, knowledgeable counsel remains a resource for businesses trying to figure out what’s next. Trusted counsel can help navigate through issues that are predictable, like the need to create policies and procedures designed to protect businesses, their employees, and customers. And as litigation in this area continues to develop in the months and years ahead, counsel will remain a steady “go-to” for up-to-date trends and determining what impact those trends have on handling these cases moving forward. As with COVID-19 itself, the old adage applies: An ounce of prevention is worth a pound of cure.
Fred M. Heiser is Shareholder in Klinedinst PC’s Los Angeles and Orange County offices. His clients include local entrepreneurs, small family businesses, and Fortune 500 companies. Mr. Heiser is regularly called on by general counsel, business owners, and claims representatives to protect their interests and to provide hands-on, strategic, and efficient direction for complex civil cases. In addition to litigation, Mr. Heiser partners with companies to strategically develop policies and procedures to minimize their liability risks. He can be reached at firstname.lastname@example.org
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