THE FIRST COURT RULINGS
Early indications provide hope that judges will properly apply legal principles to dismiss unwarranted COVID-19 lawsuits.
In May, a federal court in Missouri dismissed a lawsuit alleging that a meat processing company had cre- ated a public nuisance and breached its duty to provide a safe workplace during the pandemic. U.S. District Court Judge Greg Kays found that the company had significantly altered its operations to reduce the risk of transmission of the virus. OSHA and the USDA, not the courts, Judge Kay ruled, were the place to bring con- cerns over whether more was needed to comply with public health guidance the agencies had issued for meat processing plants. The court also found claiming that “potentially contracting COVID-19” is too speculative of an injury for a lawsuit.
The first rulings in lawsuits against cruise lines indicate that plaintiffs have an uphill battle to show that they contracted COVID-19 aboard the ship, but that they may nevertheless continue the litigation and press for settlements. U.S. District Judge R. Gary Klausner of the Central District of California dismissed 13 early “fear of” COVID lawsuits brought on behalf of cruise ship passengers in July, warning that allowing such cases to proceed would “lead to a flood of trivial suits” and “open the door to unlimited and unpredictable liability.” In August, a second federal judge in same court threw out emotional distress claims brought by a couple diag- nosed with COVID-19 following a cruise, but whose symptoms were not indicated. In that case, Judge Dean Pregerson observed, “it strikes me that it may be unclear in the complaint that there’s any injury.” Since that time, Judge Klausner has continued to dismiss negligence claims brought by passengers due to their failure to adequately link the cruise to their diagnoses. He allowed claims alleging intentional infliction of emotional distress to proceed, but ruled that the passengers’ contract with the cruise line did not allow them to do so through a class action. Both judges gave the plaintiffs an opportunity to amend their negligence claims and try again, and that litigation continues.
A federal judge in New York also dismissed a public nuisance claim brought against Amazon, claiming the company was not doing enough to protect workers at a Staten Island warehouse from COVID-19. Judge Brian Cogan ruled that it is Occupational Safety and Health Administration’s role, not the courts, to determine what are sufficient workplace protections. However, even if it was the court’s place to decide the issue, Judge Coganfound in a November 2020 ruling that the plaintiffs lacked a viable public nuisance claim. The risk of contracting COVID-19 is common to all New York City residents, and they were attempting to sue over a future harm.
Most courts that have ruled on insurance disputes thus far have found that business interruption policies cover losses of income following physical, structural damage to a specific property, not a pandemic that affects everyone. When considering a claim brought by a magazine publisher that suspended its operations, for example, U.S. District Judge Valerie Caproni of the Southern District of New York observed, “[The virus] damages lungs. It doesn’t damage printing presses.” While Judge Caproni indicated that she felt bad for every small business that has experienced losses due to the pandemic and gave the plaintiffs’ lawyers an “A for effort” and a “gold star for creativity,” she refused to require insurers to cover losses that were not covered by the policy. A few courts, however, have allowed these lawsuits to proceed, giving plaintiffs’ attorneys hope. Some observe that the tide could change. The chance of success in each case may depend on the contract language and exclusions in the specific policy at issue.
Federal judges in California have also dismissed the first lawsuits to reach rulings on airfare refunds. Those cases tried to impose liability based on airlines taking more than seven days to issue a refund of a flight canceled due to the pandemic. That seven-day period, however, does not appear in the airlines’ contracts with passengers, but is the Department of Transportation’s interpretation of a prompt refund, which even DOT recognizes may not always be attained by an airline that is operating in good faith. Those “slow refund” claims are likely to be dismissed, and cases involving passengers who never cancelled reservations or requested refunds will also face challenges.
Meanwhile, judges have allowed class actions against colleges and universities to go forward. As a federal district court judge in Florida observed, “like the ripple in a pond after one throws a stone, the legal system is now feeling COVID-19’s havoc with the current wave of class action lawsuits that seek tuition reimbursement related to forced online tutelage.”
Plaintiffs’ lawyers will likely become more sophisticated in crafting complaints and pursing COVID-19 litigation. For instance, one personal injury lawyer predicted that as exposure cases progress, plaintiffs’ lawyers will hire experts to back their claims that their clients contracted the virus at a particular defendant’s location. And, in Judicial Hellholes where state law may be more open to no-injury lawsuits and novel legal theories, judges are likely to provide plaintiffs with every opportunity to amend and refine their complaint, and subject a defendant to intrusive discovery and expensive litigation until they settle. For example, in June, a Cook County Circuit Court judge refused to dismiss a class action against McDonalds alleging that the restaurant chain’s operation created a public nuisance by not adequately protecting its employees from the virus.