Welcome

Covid-19 Shield Laws Proliferate Even as Liability Suits Do Not

June 8, 2021, 9:31 AM

Businesses soon will have broad protection from Covid-19 liability lawsuits in 30 states, covering more than half the U.S. population—an unusually speedy expansion of a legislative idea birthed just over a year ago in the pandemic’s early days.

Bills awaiting gubernatorial signatures in Missouri and Texas follow the lead of 28 other states that have provided broad immunity to businesses, health care providers, and other entities.

These laws protect most or all businesses from lawsuits that seek to assign blame for a person’s Covid-19 exposure, injury, or death, unless the person suing can prove gross negligence, willful misconduct, or failure to follow public health orders, depending on the standard specified in each state’s law. Coverage varies, with some states also protecting schools, religious organizations, nonprofits, or government entities.

The rapid spread of the liability protections is a legislative triumph for the measures’ supporters, which include chambers of commerce and other pro-business groups that warned companies could face a flood of pandemic-inspired liability lawsuits. The laws have proliferated even as the surge of lawsuits cited as their justification hasn’t arrived.

“It is unusual, but so is this global pandemic caused by COVID-19,” Alexis Jarrett, spokeswoman for the American Legislative Exchange Council, said via email. ALEC is a facilitator of conservative state policy ideas that developed model legislation for pandemic liability protections last year.

Republican lawmakers have been the primary drivers of the shield laws’ passage, but a handful of Democratic governors also have signed them, including those in Louisiana, Michigan, Nevada, and North Carolina.

Roughly half of the measures were enacted since the start of 2021, even as the availability of vaccines has expanded and the incidence of new coronavirus cases has steadily declined. More than 60% of U.S. adults have received at least one dose of a Covid-19 vaccine.

The liability shields are fashioned as protecting businesses from lawsuits by customers and the general public, as well as an establishment’s own employees, even though worker’s compensation laws already block claims of workplace illness or injury from going to court, with a few exceptions that vary from state to state.

Texas, for example, doesn’t require businesses to provide worker’s compensation insurance. But, for workers who aren’t covered, attempts to sue their employer over Covid-19 exposure would still face high legal hurdles under the state’s liability shield measure, said Rene Lara, legislative director for the Texas AFL-CIO.

“We opposed it from the worker perspective,” Lara said. “They can still sue, but there’s a requirement for prediscovery reports and things like this that create obstacles.”

Beyond the 30 states that broadly protect businesses from virus liability, a handful of others passed narrower measures focused only on health-care providers and suppliers of personal protective equipment—among them the highly scrutinized nursing home liability shield that New York enacted last year and then repealed in April.

GOP Sweep

Just one of the 23 states where Republicans control both the legislature and the governor’s office hasn’t enacted a Covid-19 liability shield law, and that’s New Hampshire, where a proposal is pending in the statehouse.

The measures moved through states in a sort of “domino effect,” like many other responses to the pandemic such as mask mandates, stay-at-home orders, and more recently reopening decisions, said Ashley P. Cuttino, a management-side attorney with Ogletree Deakins in Greenville, S.C. She co-chairs the firm’s Covid-19 litigation practice group.

“This is very indicative of what’s happened with Covid across the board, which is when one state does it and it is popular with the public, they are all falling in line behind it,” she said.

That said, the liability protections did face ample opposition in some states—as a similar but broader federal proposal did last year when it failed to pass in Congress.

Worker advocates and labor unions have said the laws could encourage businesses to be lax about following health and safety guidelines that protect their customers and workers from the virus. Pennsylvania’s Democratic governor, Tom Wolf, cited similar concerns last November when he vetoed a liability shield bill that state’s GOP-majority legislature had passed.

Other critics, such as Florida state Rep. Geraldine Thompson (D), said the measures unreasonably limit people’s access to the courts. The Florida law sets up particularly high legal hurdles for a plaintiff to bring a lawsuit, as they would need to present a doctor’s written statement attesting to the person’s claim of virus exposure at a specific location.

Flood Deterred or Delayed?

The predicted flood of lawsuits over virus exposure, often cited as justification for the measures, hasn’t really materialized, Cuttino said.

“I do think these liability shield laws have had a major deterrent effect in these types of lawsuits,” she said, but also noted claims of contracting a virus at a specific location are inherently difficult to prove.

“This type of personal injury case doesn’t seem to have gotten any traction anywhere,” including in California where no shield law has been enacted, Cuttino said. But she added that even defending and winning a lawsuit could be more costly than some businesses can afford.

“States realize their businesses have to survive the pandemic for them to have an economic recovery,” she added.

Her assessment matches what a number of lawyers have said throughout the pandemic—that the flood of liability lawsuits hasn’t shown up, but that doesn’t mean it won’t come later.

Claims related to Covid-19 have been a major factor in other types of employment-law litigation, such as discrimination, retaliation, and wage-and-hour claims, Cuttino said. The states’ liability shield laws don’t address those kinds of lawsuits, unlike a version of the federal proposal last year from Senate GOP leaders.

Hundreds of virus exposure lawsuits were filed against nursing homes in 2020, while dozens more were filed against other businesses including meatpacking plants, Jarrett said.

“These plainly demonstrate the risk of excessive lawsuits, particularly when there are people living, working, or visiting indoor spaces,” she said. “Also, more lawsuits could be filed closer to the end of the statute of limitations for COVID-19 injury lawsuits, which are generally between two to five years in duration.”

To contact the reporter on this story: Chris Marr in Atlanta at cmarr@bloomberglaw.com

To contact the editors responsible for this story: Andrew Harris at aharris@bloomberglaw.com; Travis Tritten at ttritten@bgov.com

To read more articles log in.

Learn more about a Bloomberg Law subscription.