For much of 2020, Republicans in Congress viewed COVID-19 liability protection as an integral part of its plan to stimulate an economy ravaged by the pandemic. Their legislative efforts, expressly aimed at averting “a tidal wave of lawsuits” against businesses, health care providers and others, are now on life support due to an election that diminished the party’s influence in Washington. While sufficient bipartisan support might yet be found to encourage a national response to the perceived threat, action in this arena will now be concentrated at the state level. Many states have already imposed limitations on COVID-related tort claims with an array of executive orders and legislation, and others are expected to follow. The State of Maryland may soon be among them.
The SAFE TO WORK ACT. The federal legislation proposed last year will serve as a guide to state legislators, and as a yardstick against which to measure their response. A tribute to acronyms, the SAFE TO WORK Act, S. 4317 (116th Cong., July 27, 2020) was actually titled the Safeguarding America’s Frontline Employees to Offer Work Opportunities Required to Kickstart the Economy Act. The bill, sponsored by Sens. Mitch McConnell (R. Ky.) and John Cornyn (R. Tx.), was purportedly designed to protect federal expenditures made pursuant to the CARES Act (Pub. L. 116-136), the initial federal response to the pandemic’s economic disruption: “Congress must ensure that those funds are used to help businesses and workers survive and recover from the economic crisis, and to help health care workers and health care facilities defeat the virus. CARES Act funds cannot be diverted from these important purposes to line the pockets of the trial bar.” Id., §2(a)(11). The authors of the legislation were convinced that COVID-related lawsuits “risk diverting taxpayer money provided under the CARES Act and other coronavirus legislation from its intended purposes to the pockets of opportunistic trial lawyers.” Id., §2(a)(15).
The bill, retroactive to December 1, 2019, would have preempted all less restrictive state laws and given federal courts exclusive jurisdiction over actions for personal injury and loss resulting from exposure to the virus. The SAFE TO WORK Act imposed significant substantive and procedural burdens on plaintiffs, provided a safe harbor for businesses, limited the liability of defendants to acts involving gross negligence and willful misconduct, shortened the limitations period and, to add teeth to its assault on the plaintiffs’ bar, left lawyers personally liable for compensatory and punitive damages, attorneys’ fees and civil penalties for making “meritless” settlement demands in coronavirus exposure cases. Id.,§164.
The procedural burdens imposed on plaintiffs would have begun with the filing of a complaint. Under the Act, any complaint alleging injury resulting from COVID exposure was to be filed under penalty of perjury, and to plead with particularity: (a) each element of the claim; (b) each act or omission constituting the gross negligence or willful misconduct that led to the injury; (c) all places and people visited by, or who visited with, the plaintiff for the 14 days prior to the onset of symptoms, and as to each, a statement of the factual basis for believing that the exposure was not caused by those other visits; and (d) specific information as to the nature and amount of each element of damage, and the factual basis for the calculation. Id.,§163.
In addition, copies of certified medical records documenting the plaintiff’s alleged injury, and an affidavit of a non-treating health care expert stating the basis for their belief that the plaintiff actually suffered such injury, was to be appended to the complaint. Id., §162. The time to put all of this information together was short, as the statute of limitations for coronavirus exposure actions was to have been one year from the date of the alleged exposure, rather than three years as is typical for tort claims in Maryland and many other states. Id., §121(c).
The SAFE TO WORK Act would also have provided a safe harbor and immunity from liability for businesses that complied with at least one set of government recommendations regarding coronavirus practices, and it eliminated simple negligence as a basis for relief. Thus, a successful plaintiff would be required to plead and prove, by clear and convincing evidence, that through gross negligence or willful misconduct the defendant failed to make reasonable efforts to comply with all applicable government guidance in effect at the time of the alleged exposure. Id., §122. And, if a plaintiff was able to negotiate all of those hurdles, any award of damages would be reduced by amounts received from other sources, including insurance, abrogating the “collateral source rule” available to plaintiffs in Maryland and elsewhere. Id., §162(b)(3).
The SAFE TO WORK Act became a casualty of negotiations for the second stimulus package enacted in December 2020. Congressional Democrats were opposed to the SAFE TO WORK Act, at least as written. According to some reporting, Republicans were willing to forego near term liability protection in order to get a second relief package passed, and because states had already entered the field.
State Liability Protection. By the time the second stimulus package was signed into law on December 28, 2020, all but 17 states had passed or were considering some manner of COVID-19 liability relief. While several states attempted to protect its businesses and health care providers by executive order, most used the legislative process. The states have also varied their approach, with some states providing or proposing blanket immunity for all industries, some opting to protect specific businesses, and some choosing simply to limit damages or to increase a plaintiff’s burden of proof in exposure cases.
Several states, such as Oklahoma, took a tack similar to that proposed in the SAFE TO WORK Act, but without imposing the same pleading and proof requirements. The Oklahoma bill provided that no individual or entity shall be liable for a claim for injury resulting from COVID-19 exposure if the conduct alleged to have breached a duty of care was consistent with governmental regulations, orders or guidance applicable at the time of the alleged exposure. A separate law now on the books in Oklahoma exempts from the state’s product liability laws any individual or business that designs, manufactures, distributes, sells or uses disinfectants or personal protective equipment in response to the pandemic. Alaska and Wisconsin, in contrast, enacted protections only for those who sell or distribute the emergency medical supplies, without protecting other businesses. Common to all of these liability protections are exceptions for acts or omissions that constitute gross negligence or willful misconduct.
There are, as noted, several states, like Arkansas and Alabama, that have tried to accomplish similar results by executive order. In Arkansas, for example, the Governor has decreed that all businesses which remained open during the pandemic “shall be immune from civil liability for damages or injuries caused by or resulting from exposure of an individual to COVID-19….” The Alabama order is more comprehensive, but is the subject of pending legislation which, if passed, will supercede it.
A survey of and citations to laws enacted and pending in the states can be found here.
Where Maryland will end up on issues regarding coronavirus exposure claims remains to be seen. Two COVID-19 immunity bills were filed before the legislative session opened on January 13, 2021: SB 210, which generally proposes immunity for exposure claims in favor of any person or entity that complies with federal, state and local laws, executive orders and agency orders; and HB 25, which would apply only to health care providers. More bills are expected to be filed in the coming days.
Unless and until the new Congress takes up the issue of COVID-19 liability protections, attention will remain focused on the states, and Maryland is now in play. Throughout the 2021 session of the General Assembly, action taken on these and other bills of interest to the profession will be tracked in the MSBA’s Legislative Action Center and Practice Area Updates, accessible through the Advocacy pages of the Association’s website. Regular updates will be provided.