As the number of cases and deaths due to the novel coronavirus (COVID-19) rise, so to do the number of lawsuits filed related to the virus. Claims for breach of contract based on consumer protection laws are already underway against sports/health clubs, against Walmart, and several cruise lines for negligence, and against nursing home facilities for wrongful death. We can expect lawsuits against residential property owners & managers, restaurant owners & operators, grocery store chains, and potentially even against delivery service providers. Below is a brief summary of recently filed COVID-19 lawsuits and ideas about how to minimize exposure to future litigation.
Service Disruption Claims Against Sports Clubs
At least four health club chains (Boston Sports Clubs, Blink Holdings, New York Sports Clubs, and Fitness International) have been sued for COVID-19 related consumer protection and breach of contract claims. Plaintiffs claim that these sports clubs improperly continued to withdraw monthly dues (or portions thereof) despite the fact that the clubs are closed. Although these novel claims were filed in a few states, it is likely that similar claims will arise nationwide.
Several defenses to these claims derive from the language contained in the membership agreements of the plaintiffs. Many agreements contain class action waivers, and most contain a requirement to arbitrate any dispute. These types of provisions will be relied upon in an effort to defeat these claims on early motion practices, and force Plaintiffs to individually pursue their claims either in court or before an arbitrator. Courts across the country generally favor the enforcement of these contractual provisions if voluntarily entered into by both parties. In addition to these provisions, sports clubs also have the ability to assert defenses ordinarily available to all other contract claims, including acts of god, force majeure, and impracticability. The availability of these defenses is contingent on the language of each agreement as well as the other circumstances presented, including whether the sports clubs have any discretion as to whether to close their doors.
Another set of defenses to these claims stem from the timing of the claim and the response by the sports clubs. These claims may be subject to dismissal for ripeness if they are made against the sports clubs before the fees become due. The claims also may be dismissed if they are moot, or if the sports clubs take certain action to render them moot. For example, if the sports club elects to remit a pro-rata refund of fees or a credit for future months, the claims made against them may become moot. These decisions will have to be made balancing the cost of litigation against the potential refunds.
Finally, defenses may arise depending on how the claim is framed and alleged by the Plaintiffs. Any claims for violation of consumer fraud acts, unfair trade practices, bad faith, or the like must be plead with specificity. Without the required specificity and factual basis, the claim will be subject to dismissal. If a class action claim is brought by a plaintiff in one state seeking to represent other plaintiffs across different states, it is possible that their claim can be narrowed based on standing principles. The language used by the plaintiffs in their complaints is critical.
In sum, the defense of class actions brought against sports clubs, like other entities targeted as a result of COVID-19, depends on the situation presented. The law on these issues differs from state to state, and whether the claim is brought under certain federal or state laws, so a case-by-case analysis is required. Therefore, it is especially important to evaluate these options at the very outset of the litigation.
Negligence and Class Action Claims – Cruise Ship Companies
Princess Cruise Lines Ltd. is facing lawsuits over its response to COVID-19. The first case against the cruise line was filed on March 9, 2020. Princess was sued by a couple who traveled on the Grand Princess cruise ship, which was held offshore for four days before being allowed to dock in northern California. Plaintiffs in that case, Ronald and Eva Weissberger, pled claims for negligence and gross negligence based on the company’s alleged failure to adequately warn them about the vessel’s potential exposure to the coronavirus before they boarded and/or after they were aboard the cruise ship. The Weissbergers claim that the cruise line breached its duty to provide reasonable care to them and the other 3,500 passengers. They claim that Princess continued to sail even after learning that at least one passenger from a previous voyage exhibited virus symptoms. The Weissbergers claim that they never would have boarded the ship had they known of the risk before embarking on the cruise. They are seeking past and future medical expenses as well as punitive damages. The attorney representing the Weissbergers, Debi Chalik, filed at least nine other cases against Princess Cruises, alleging that Princess Cruises was grossly negligent for sailing when it knew the ship was infected by the previous passenger.
The most recent case against the cruise line was filed by Susan and Michael Dorety of Texas, who boarded a Princess Cruise Line ship February 21. Mr. Dorety became ill while onboard the ship. He died from COVID-19 complications and Susan Dorety later contracted COVID-19.
Although class action lawsuits involving cruise lines are rare due to waiver language found in passenger tickets, on April 7, 2020, a potential class action lawsuit was filed against Costa Cruise Lines Inc. (“Costa”). In that lawsuit, plaintiff Paul Turner alleged that Costa negligently allowed more than 2,000 passengers on a transatlantic voyage at risk of catching the coronavirus despite knowing, before the ship left, that a passenger from the most recent cruise tested positive for the virus and died as a result. Mr. Turner alleges, among other things, that the cruise line allowed new customers to board the ship without adequate sanitation measures. Plaintiff alleges that Costa told passengers that its vessel was not affected by the coronavirus, and that they would not be reimbursed if they canceled their voyage.
Overall, claims against cruise lines are often difficult due to restrictive terms of service contained in each passenger’s paperwork and due to maritime law. Despite this, we can expect to see many more filings considering the number of cruise line passengers nationwide (and worldwide) that contracted the virus.
Potential Negligence Claims - Property Owners/Managers
Residential property owners should be wary of potential lawsuits from tenants, guests and invitees claiming that they were exposed to the virus at their property. These individuals might claim that the building was unclean or allowed exposure to other tenants with COVID-19, leading to coronavirus transmission. Negligence claims could involve whether the owner or manager took appropriate and reasonable steps to minimize the risk of virus transmission to a given individual.
For instance, as of April 20, 2020, seven states— Connecticut, Hawaii, Maryland, New Jersey, New York, Pennsylvania, and Rhode Island—made masks mandatory for employees of essential businesses (those that are now open but we would assume these requirements will continue as other businesses open). Although there are certain variations, states like Pennsylvania require businesses to provide masks to their employees. It can be anticipated that additional states will implement mask requirements, or other similar mandates.
Property owners and similarly situated entities should engage in an internal review of their precautions. For example, did the owner/manager take reasonable steps to restrict access to places where tenants may come into close contact with each other, such as playgrounds, laundry rooms, mailboxes or other commonly shared areas? Do all of the landlord’s employees wear masks and/or gloves while working? Is there a procedure in place that requires the virus stricken tenant to notify the owner/manager so that appropriate steps can then be taken to ensure the safety of all other tenants, and provide notice to others without violating privacy laws?
If an owner/manager is notified that a tenant tested positive for COVID-19, what obligations does an owner/manager then have to that tenant? Can the owner mandate tenant isolation? What are the owner’s or manager’s obligations to the other tenants at the property under these circumstances, especially any co-tenants of the infected tenant? Should the owner/manager advise only the tenants of the building where the infected tenant resides, or should tenants of all other buildings on the property be notified? What information is the owner/manager able to divulge to other tenants, and how is that information to be communicated? These are all critical questions that need to be considered and assessed based on the facts at issue in a given instance.
In most jurisdictions, a business owner has a duty to take reasonable measures to limit a customer’s exposure to dangerous conditions. A business owner must take reasonable care to provide a safe environment for their customers. This duty of care generally requires a business owner to assess whether any dangerous conditions exist at the business and to take reasonable efforts to eliminate that danger, or warn others of its existence. In other words, the business owner must maintain the premises in a safe condition and safely operate the business so as to avoid creating conditions that would render the premises unsafe, both to employees and customers. Such assessment is done on a case-by-case basis.
Potential Negligence Claims -- Commercial Stores and Delivery Services
Grocery stores and other “essential” businesses remain open to the public and many have already implemented requirements that employees wear masks, keep social distance measures and have their temperature checked before starting shifts. Most stores have signs posted at the entrance to remind customers to follow social distancing and to stay six feet apart inside the store. Many grocery stores installed plexiglass protective shields at check-out lines to prevent direct contact/breathing between the customer and store employee. Stores also placed lines of tape near the check- out stands, six feet apart, to visually remind customers to stay 6 feet apart there. In California, some business are posting signs that require customers to wear a mask or else they are not allowed to enter the store. Most employees in essential businesses are already wearing masks and gloves. Many of these types of “essential” businesses clean shopping carts and other areas of constant customer contact. To be safe, health experts recommend that a customer should not be allowed to use a cart returned by a prior customer until it has been thoroughly cleaned and disinfected.
Unfortunately, despite the above safety measures, they may not be enough. An article posted on CNN Business on April 19, 2020 references the fact that dozens of grocery store workers have died from COVID-19 despite the use of some of the safety measures intended to keep them safe; temperature checks and capacity restrictions. The CNN article points out that workplace experts, union leaders, and small grocery store owners believe the time has come to completely ban customers from the stores because it has become too dangerous to let customers browse aisles, regularly coming in close range with workers. The same experts feel that the time has come for large chain grocery stores to “go dark” to the public and convert to curbside pickup only, or home delivery mode. This is an extreme measure that does not appear to have been implemented by businesses to any noticeable extent; indeed, shutting down a business could have significant financial implications. Nevertheless, businesses should be prepared to defend claims from plaintiffs that will pursue the most extreme theories to obtain a favorable result.
One store owner in Pennsylvania went so far as to discard $35,000 worth of food after a customer coughed on fresh produce, a seemingly extraordinary precaution that the owner believed to be a reasonable measure that would minimize the rest of his customers’ risk of contracting COVID-19. The owner decided, on balance, that the loss of inventory was outweighed by the potential harm to the store’s customers. Businesses should be making these determinations not with the goal of perfection, but with what is reasonable.
Restaurants and stores not limited to providing take out and/or delivery orders remain exposed to future claims if a customer comes down with the virus. The claims could involve issues related to how food is distributed from these restaurants and stores. To the extent that cardboard and plastic surfaces can retain the coronavirus, businesses should consider wiping down those surfaces prior to placement on a delivery truck. Businesses should also consider if those products should be wiped down again before being left at a homeowner’s front door, and if so, how? Such businesses should also consider whether they are exposed to a potential suit if they choose one method of cleaning as opposed to another. Should they clean the entire exterior of all boxes being delivered? Should all drivers wear masks and gloves during the delivery process? These are judgment calls.
Walmart was recently sued by the surviving family of a store employee who died from COVID-19. The plaintiffs filed a wrongful death lawsuit alleging that the Walmart Superstore at issue failed to take steps to protect its employees. More specifically, the plaintiffs’ complaint alleges that the Walmart Superstore in Evergreen Park, Illinois, failed to warn the decedent and other employees that co-workers had COVID-19 symptoms. Wando Evans, 51, died March 25, 2020. Sadly, a second store employee, Phillip Thomas, 48, died from COVID-19 complications four days later.
The Evans complaint alleges that Walmart failed to close the store even though it knew or should have known that employees and others at the store had COVID-19 symptoms. The complaint further alleges that Walmart failed to prevent employees with COVID-19 symptoms from working at the store. Also, plaintiffs allege that Walmart hired people over the phone or by other remote means without evaluating whether the prospective employees had symptoms of the virus. Finally, the Evans complaint alleges that Walmart failed to clean and sterilize the store, failed to provide employees with personal protective equipment, and failed to promote and enforce social distancing.
Walmart released a statement advising that neither of the employees had been at the store for more than a week and that it had taken action to reinforce cleaning and sanitizing measures, including deep-cleaning of key areas. The statement also advised that Walmart passed a third-party safety and environmental compliance assessment, as well as a health department inspection. As an extra precaution, Walmart brought in an outside company to further clean and sanitize all high-touch surfaces in the store, which included the decontamination of front entrances, carts, registers and bathrooms, as well as food areas, including the produce and meat sections. The statement also advised that Walmart then took steps across the country to protect associates and customers, including implementing additional cleaning measures, installing sneeze guards at registers, placing social distancing decals on the floors and limiting the number of customers in a store at a given time. Nevertheless, the lawsuit alleges that these preventative measures were taken only after the deaths.
As in this case, the timing of these measures is important. Deciding which actions to take and when decisions are to be made is based on a reasonableness standard. Businesses like Walmart need to take reasonable measures to prevent the transmission of the coronavirus. It is anticipated that plaintiff firms will latch onto any action or inaction when crafting their claims. A certain portion of these claims may be founded on questionable facts, but that will not prevent them from being filed. To be clear, this is a very uncertain time with information evolving by the day, if not the hour. Businesses do not need to be perfect. But, they need to make reasonable efforts to be informed, and take reasonable precautions and provide reasonable notice under the given circumstances, geared toward the safety of those potentially exposed.
Potential Negligence Claims – Nursing Homes and Elderly Care Facilities
Negligence claims against nursing home facilities alleging inadequate infection prevention controls, lack of personal protective equipment, inadequate staffing, insufficient warnings, or the like are nothing new. In fact, these types of claims persisted prior to the COVID-19 outbreak, and likely will continue after the virus is controlled. These claims are ripe for the filing based on the remarkably contagious nature of this virus and potentially deadly effect of COVID-19. One thing all news outlets agree upon is that the elderly, and nursing home populations in general, have more difficulty with COVID-19.
Early statistics show that COVID-19 deaths at nursing homes and elderly care facilities represent a high percentage of all deaths, meaning that the exposure to these types of claims is high. In an outlier example, a nursing home in New Jersey recently made national news when it was discovered that it was housing 17 dead bodies in the facility. The nursing home is reportedly understaffed and overwhelmed, namely because 41 of its staff are infected with COVID-19.
Claims against these facilities can and will be made by the patients themselves, the patient’s family, workers at the facility (depending on the identity of the “employer”), delivery personnel, contractors, and others. Indeed, a wrongful death claim was filed already in Washington state against a nursing home, Life Care Center. In that case, the daughter of a deceased resident claims that her mother died of COVID-19 because the nursing home lacked “a clear plan of action leading to a systemic failure.” Particularly, the nursing home is alleged to have permitted residents and visitors to have a Mardi Gras party, failed to quarantine residents, and delayed reporting of positive cases for 17 days.
To avoid or curtail these impending claims, nursing homes should consider taking all practical measures geared toward the safety of the individuals in their facilities. The recommendations made by the government and related agencies should serve as guidance and a failure to comport with them will be relied upon by plaintiffs. For example, some states like Connecticut are imposing their own safety requirements on nursing homes to segregate COVID-19 residents on separate floors. These facilities should make efforts to plan ahead in an attempt to curtail any supply shortages. They should be reasonably forthcoming with facts they learn regarding COVID-19, but should proceed cautiously so as to not violate any privacy laws. All of these actions, in the face of a negligence claim, will be valuable evidence to rely upon for the proposition that the facility was doing its best to protect its patients and the population at large, under these extreme circumstances.
The legal-framework for claims against sports clubs, cruise ships, property owners, stores, delivery service providers, and nursing homes generally remains the same. However, the circumstances presented by COVID-19 related claims are novel, during these unprecedented times. Businesses should rely on the language of their agreements and traditional legal principles to defeat claims for breach of contract, breach of consumer laws, and class actions. The question at the heart of many negligence based COVID-19 lawsuits is likely to revolve around whether these entities took reasonable measures, based on then existing state of the art knowledge, to prevent the spread of the coronavirus. Plaintiffs may have difficulty proving a causal connection between alleged exposure and a given plaintiff’s illness (whether a defendant’s failure to take precautions caused the infection in that person). However, the better the facts are to defeat the negligence claim, the more likely the jury will care about the lack of causation defense. Rest assured, the converse is equally true.