Will Lawmakers Provide Immunity to Businesses from COVID-19 Lawsuits?

As state and local governments take steps toward reopening the economy, business owners are rallying around the issue of liability immunity from COVID-19 lawsuits and organizing efforts aimed at pressuring federal and state lawmakers to enact legislation limiting liability from lawsuits filed by workers and customers infected by COVID-19. The stakes are high. Because the complete clinical picture regarding COVID-19 is not fully understood, big and small businesses alike are targets for opportunistic lawsuits. When symptoms may not develop for days after the fact, just one infection can form the basis of a lawsuit against multiple businesses. Hundreds of COVID-19 lawsuits have already been filed, and business leaders say liability immunity is necessary in order to protect against abusive lawsuits and heal the battered economy. Just the mere threat of litigation may cause many businesses to remain closed or delay reopening because few businesses can afford the costs of defending a lawsuit following weeks of business disruption amid the sudden economic recession.

Senate Republicans, led by Majority Leader Mitch McConnell, are expected to consider providing liability immunity as they prepare the next COVID-19 relief bill. McConnell told Politico, “[t]he next pandemic coming will be the lawsuit pandemic in the wake of this one. So we need to prevent that now when we have the opportunity to do it.” Protections would not only be extended to businesses, but also religious institutions, medical facilities, and schools.

Republican-led efforts have met resistance from Democrats, who say additional legal protections would encourage wrongdoing and put workers and customers at risk. U.S. House of Representatives Speaker Nancy Pelosi indicated that Democrats would not support protections for businesses against COVID-related litigation. Pelosi stated “[e]specially now, we have every reason to protect our workers and our patients in all of this. So we would not be inclined to be supporting any immunity from liability.” Similar arguments have not frustrated lawmakers from legislating liability immunity.

Utah recently extended liability immunity to companies “for damages or an injury resulting from exposure of an individual to COVID-19” on their premises. We previously wrote about New York, New Jersey, Michigan, Illinois, Connecticut, and Kentucky giving legal protection to nursing homes and long-term care facilities. We also wrote about the Public Readiness and Emergency Preparedness Act, which provides liability immunity to manufacturers, distributors, and retailers operating mainly in the in the pharmaceutical and medical device spaces, for any claim under federal or state law for damage caused by, arising out of the use of pharmaceuticals, biologics and medical devices to combat the COVID-19 pandemic.

Until lawmakers can enact laws protecting businesses from unjustified COVID-19 lawsuits, the decision to reopen for business will be a difficult one given the legal uncertainty and risk of becoming targeted by workers and customers infected by COVID-19.

 

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