Lawsuits to Watch
As industries across the planet continue to weather the COVID-19 pandemic, the effect on the legal industry resulting from the global shutdown will be substantial, re-shaping the way litigation unfolds in the future. As the court system slowly begins to implement reopening plans with challenging and changing rubrics, the practice of law will need to evolve as well to accord with this “brave new world.”
In this series, we’ll explore how the practice of law may be altered in the post-pandemic American judicial system, including the types of cases likely to increase, procedural differences when courts open, and necessary adjustments to law firm culture.
To begin, we’ll focus on lawsuits expected to arise in the coming months as a result of the after-effects of COVID-19.
Transmission and Failure to Warn Cases:
As the pandemic continues, it reasonably follows that there will be an increase in the number of lawsuits filed related to COVID-19 and how individuals and businesses reacted, or failed to react, to the danger the virus presented. Companies will be closely scrutinized as to whether they properly handled the safety of both their customers and their employees, and whether they negligently enabled the spread of the Coronavirus.
One of the first COVID-19 class actions to surface was filed against the cruise line industry. Beginning in mid-March 2020, Americans became increasingly aware of the situation emerging on many cruise ships, where passengers were forced to quarantine onboard as a result of presence of the coronavirus. Subsequently, a series of class actions have been filed against various cruise lines alleging that many were aware of the risk that the coronavirus posed to passengers and crew and yet failed to immediately implement proper physical distancing measures and other preventative precautions to stop the spread of the highly contagious virus. In turn, the suits allege that this caused extended forced quarantine periods onboard the infected ships causing more and more individuals to fall ill. In most cases, these lawsuits bring causes of action including general negligence, negligent failure to warn, negligent infliction of emotional distress and intentional infliction of emotional distress.
Tuition Reimbursement Class Actions:
As the COVID-19 pandemic continued to worsen in the United States, many educational institutions began to shut down physical campuses and institute an online learning format. As such, students were encouraged to leave on-campus housing and were no longer able to take advantage of the programs and athletics offered by their institutions. Despite the closures of physical campuses, many colleges and universities failed to reimburse students for unused portions of the fees paid for room and board, and other campus services no longer available to students such as health facilities, student associations, athletic centers, and on-campus dining plans. Plaintiffs also claimed that online studies were far inferior to on-campus learning and that there should be partial tuition reimbursement as well. This resulted in many class actions, similar in nature, to be filed across the country for breach of contract, demanding reimbursement to students.
CARES Act and Paycheck Protection Program Lawsuits:
The Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) is one of the largest economic relief programs ever introduced by the United States government and has been utilized by American businesses to stay afloat during the pandemic and accompanying shutdown.
However, as with any large-scale financial assistance plan, there are bound to be difficulties. In many lawsuits filed regarding the CARES Act, plaintiffs allege that banks have failed to properly administer loans under the Paycheck Protection Program. Specifically, many are claiming that certain banks misused government funds available under the program by preventing qualifying small businesses from obtaining Small Business Administration loans and giving preferential treatment to larger businesses and pre-existing banking clients. Plaintiffs in the suits similarly seek monetary damages as well as injunctive and declaratory relief.
Membership renewal and Season Pass Claims:
Although we’re all looking forward to the day that we can exercise at our local gym or plan a trip to an amusement park with our children, it is not likely that we’ll resume those activities to their fullest extent in the near future. However, many Americans have paid for gym memberships or theme park season passes that are not currently usable. In some cases, these payments may be subscription-based and are automatically charged on a recurring basis to the credit card on file, regardless of whether or not the facilities can be accessed.
Plaintiffs seek refunds of membership fees and seasonal passes payments made to businesses that are currently closed. The suits bring causes of action for breach of express warranty, negligent misrepresentation, unjust enrichment, conversion and breach of contract.
Insurance Litigation:
In the wake of the involuntary closure of many businesses, companies have turned to their insurance carriers, only to be told that losses caused by the COVID-19 shutdown are not covered by their policies. Many COVID-19 insurance cases are currently progressing through the state court system. Recently, in several cases filed in Pennsylvania federal court, the Judge ordered the actions transferred to state court. Judge Nora Barry Fischer of the Western District of Pennsylvania opined that if the federal court was to decide the matter, it would merely be predicting how Pennsylvania state courts would react to the novel issues surrounding denial of policy benefits. Judge Fischer went on to predict an influx of similar cases in the months to come.
Website Noncompliance with the Americans with Disability Act Lawsuits:
While ADA lawsuits may not immediately come to mind, with the surge in online sales due to stay-at-home orders resulting from COVID-19, it can be assumed that there may be an increase in cases filed under the Act. As retail establishments continue to move further away from traditional brick-and-mortar stores to focus on online sales, such a shift demands increased compliance with ADA standards. Digital interfaces must be accessible to all, and especially so in the wake of the considerable move toward virtual communication and commerce.
The global nature of the current health crisis has encompassed every industry in its wake, the legal industry included, creating change on what seems like a daily basis. As the world adapts, entities will still be held accountable for injustices. It is yet to be seen what the overall effect will be, but those outlined are likely to be at the forefront of resulting litigations.
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