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North Carolina Aims to Shield Companies From Lawsuits Over Covid

June 23, 2020, 10:14 PM

North Carolina businesses would be protected from lawsuits if their employees or customers contract the coronavirus under legislation heading to the governor’s desk.

The Legislature gave final approval Tuesday to a bill (H.B. 118) that covers businesses, government agencies, and other groups sued by someone who contracts Covid-19.

The bill is backed by business groups that say the protections are needed as companies reopen and as lawsuits increase nationwide. The measure now goes to Gov. Roy Cooper (D) for his consideration. Representatives of the governor’s office didn’t immediately respond to an inquiry about whether he intends to sign it.

The bill “will provide welcome and much-needed protections to safeguard North Carolina businesses against predatory COVID-19 claims as we work to relaunch our state’s economy,” the North Carolina Chamber said in comments provided to Bloomberg Law.

H.B. 118 would shield companies and other entities from lawsuits as long as they don’t act with gross negligence or intentional wrongdoing. The protections wouldn’t apply to workers’ compensation claims.

Workers Would Assume Risk

Businesses would be required to provide “reasonable” notice of actions they have taken to reduce the risk of transmitting the virus on their premises, but they wouldn’t be held accountable if workers or customers fail to comply.

The bill would apply to claims that arise no later than 180 days after North Carolina’s state of emergency ends.

Limited immunity for health-care facilities, providers, “essential businesses,” and emergency response entities are already protected under a measure Cooper signed into law May 4.

Jeff MacHarg, a partner with Fox Rothschild’s law offices in Charlotte, N.C., who handles business litigation, called the bill an important additional step toward reopening North Carolina’s economy. The measure would provide “some psychological comfort to businesses” that they can reopen, while encouraging them to consider steps to prevent the spread of coronavirus, he said.

H.B. 118 passed the state Senate June 18 by a vote of 40-7 and received final approval by the House of Representatives Tuesday by a margin of 109-6.

To contact the reporter on this story: Andrew M. Ballard in Raleigh, N.C. at aballard@bloomberglaw.com

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