The COVID-19 pandemic is an unprecedented crisis that has affected every facet of life from health and financial security to education and emotional well-being. Moreover, the crisis is ongoing and the full extent of its impact is yet unknown. The public and private sectors have joined to respond rapidly to this threat. At the same time, state and federal governments have enacted measures meant to protect healthcare providers and facilities on the front lines, as well as the manufacturers who are developing life-saving treatments and equipment. Despite these protections, the question looms whether we will see a wave of lawsuits that are too often a byproduct of large-scale emergencies.
GOVERNMENT MEASURES TO PROTECT HEALTHCARE WORKERS, FACILITIES, AND PRODUCTS
On March 17, 2020, the Secretary of the Department of Health and Human Services (“HHS”) issued a Declaration pursuant to the PREP Act (“Act”), which provides legal immunity to manufacturers, distributors, suppliers and administrators of qualified products and processes used to fight COVID-19. HHS backdated the Declaration to be effective as of February 4, 2020, and it will last until October 1, 2024.
The Act covers a wide range of people and entities, including manufacturers, distributors, program planners, and qualified persons, along with their officials, agents, and employees. The PREP Act defines “manufacturers” and “distributors” broadly and offers a similarly wide-ranging definition of those persons protected under the Act, as well as the countermeasures they take in treating the virus.
Immunity under the Act includes “any claim [under Federal or State law] for loss that has a causal relationship with the administration to, or use by, an individual of a covered countermeasure.” The Act defines a “loss” to include death, personal injury, emotional injury, property damage, business interruption and fear of personal injury. The protection is very broad and applies “without regard to the date of the occurrence, presentation or discovery of the loss.” It also includes a rebuttable presumption that the administration or use of a covered countermeasure was for the threat covered by the Declaration. Thus, to succeed on any potential claim, a plaintiff would have to produce evidence to overcome the presumption that the “covered person” is not entitled to immunity.
The Act further provides for compensation through the “Covered Countermeasures Process Fund” (“Fund”), which is designed to cover eligible individuals who suffer injuries as a direct result of a countermeasure administered or used under the Declaration. Compensation will cover reasonable and necessary medical benefits. Death benefits may also be available to certain survivors. The Fund is the payer of last resort, so benefits are reduced by the amounts paid by all other public and private third-party payers (such as health insurance and workers’ compensation).
However, it is important to note that covered individuals may still pursue a tort claim in certain instances, including where the HHS does not make a final determination on the individual’s request within 240 days. Additionally, if the individual decides not to accept the compensation, he or his representative, may pursue a tort claim in the United States District Court for the District of Columbia—but only if the claim involves willful misconduct and meets the other requirements for suit. The district court will reduce any award by public or private insurance or workers’ compensation available to the injured individual. Awards for non-economic damages are also limited. Conversely, if the individual accepts compensation from the Fund, or if there is no willful misconduct, the individual cannot pursue a tort claim in either the federal or state court systems.
Earlier this month, the Governor of New Jersey signed Executive Order No. 112, which protects healthcare workers and related facilities involved in the treatment of COVID-19. The order provides immunity to many categories of healthcare workers and facilities but denies immunity for acts or omissions that constitute a crime, actual fraud, actual malice, gross negligence or willful misconduct. In New York, a similar measure is in place, Executive Order No. 202.10. This order provides that “all physicians, physician assistants, specialist assistants, nurse practitioners, licensed registered professional nurses and licensed practical nurses shall be immune from civil liability for any injury or death alleged to have been sustained directly as a result of an act or omission by such medical professional in the course of providing medical services in support of the State’s response to the COVID-19 outbreak, unless it is established that such injury or death was caused by the gross negligence of such medical professional.”
OTHER POTENTIAL TARGETS
Non- healthcare related entities have not, however, been granted these broad immunities, and certain sectors are already facing tort claims for their purported failure to properly respond to the pandemic. In February and early March, plaintiffs targeted the cruise line industry with a spate of lawsuits filed by passengers aboard a number of different ships. These suits allege, among other things, that the cruise lines were negligent by failing to properly warn passengers that COVID-19 infected others on their voyage, or previous voyages of a ship, and further allege the cruise line failed to properly disinfect the ships during and between voyages, allowing some to get sick. In the case of Princess Cruiselines, plaintiffs have also sued for the fear of becoming ill based on language contained in their tickets. Plaintiffs may be limited to economic damages based upon maritime law, but the outcome remains to be seen given the unprecedented nature of the crisis.
Likewise, employers may face claims as they work to staff essential businesses while protecting their workers. A recent lawsuit filed by the estate of a Walmart employee who passed away from COVID19 alleges that Walmart failed to properly handle sick employees, failed to notify employees of their symptomatic coworkers, and failed to protect workers with proper sanitizing and social distancing measures per recently issued CDC Guidelines. It may be that such claims only sound in workers’ compensation.
We live in uncertain times, and that uncertainty extends to the potential legal fallout from the pandemic. We do know that the harm will be extensive and severe. For that reason, the anticipation of litigation is reasonable. It remains to be seen how effective government protections will be and what novel legal theories may emerge.
Additionally, we likely remain months, if not years away from the bulk of COVID19 related litigation making its way through our courts. Any litigation will also likely be unique in issues presented and standards imposed by the courts upon defendants who have stepped up.
About O’Toole Scrivo, LLC
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