August 13, 2020

COVID-19 Civil Immunity Under Proposed Federal SAFE TO WORK Act and State Laws

Holland & Knight Alert
Jessica Ragosta Early | Gina A. Fonte | Chelsea W. Rogas

As the first wave of COVID-19 exposure lawsuits begins to spread across the country, already-struggling businesses are looking to state and federal governments for immunity from liability.

However, state laws regarding COVID-19 civil immunity have varied widely when it comes to key questions such as who qualifies for immunity, what acts or omissions are protected, and how long the immunity lasts. In addition, a proposed federal law faces an uphill battle due to stalled negotiations over the next coronavirus relief package as well as some unique features of the act itself.

Recent Federal Legislative Activity

On Aug. 5, 2020, Republican attorneys general from 22 states submitted a letter to Senate leaders in support of the national COVID-19 civil liability protections proposed in the SAFE TO WORK Act, S. 4317, introduced by Senate Republicans on July 27, 2020. Citing a "risk of a tidal wave of lawsuits" accusing businesses, educational, religious and nonprofit institutions, local government agencies and healthcare providers of exposing people to COVID-19, the law, if enacted, would impose strict nationwide limitations on coronavirus-related tort liability. With limited exceptions, the proposed law would preempt all other federal, state and tribal laws except those that provide even greater immunity and protection against liability. The SAFE TO WORK Act also would permit any covered lawsuits to be filed in or removed to a federal district court by any defendant. In addition, it would apply retroactively to pending actions and claims.

The State of State Civil Immunity Laws

The proposed SAFE TO WORK Act aims to address the current patchwork of state civil immunity laws, which vary widely across the country. Currently, nearly a dozen states have enacted legislation limiting COVID-19-related civil liability for a broad range of businesses. Those states include Iowa, Kansas, Louisiana, Mississippi, North Carolina, Oklahoma, Utah, Wyoming and, most recently, Georgia. Several other states and the District of Columbia have enacted legislation limiting liability for a more limited subset of individuals or entities, including healthcare providers, manufacturers and suppliers of personal protective equipment (PPE) or certain other supplies, and/or volunteers. Those states include Alaska, Kentucky, Massachusetts, New Jersey, New York, Ohio and Wisconsin. About a dozen other states have legislation pending that, if enacted, would provide varying degrees of civil immunity. In Pennsylvania, for example, several competing bills are pending. To further complicate matters, most states also have imposed some limitations on COVID-19-related liability — mostly for healthcare providers, manufacturers and suppliers of PPE or other supplies, and/or volunteers — as a result of executive orders, proclamations or emergency declarations. Other states, such as Florida, have not enacted or proposed COVID-19 civil immunity laws, despite pressure from businesses, healthcare providers and other groups voicing concerns about potential COVID-19 liability exposure.

The details of each state civil immunity law vary widely, including who qualifies for immunity, what acts or omissions are protected, and how long the immunity lasts. Nearly every state law preserves liability for certain types of extreme or intentional conduct, most commonly for willfulness, recklessness and gross negligence. However, the precise scope of each immunity exception varies by state. For some states, such as Iowa and Kentucky, the exceptions vary by type of entity or individual covered. Other state laws provide a safe harbor for covered entities or individuals who comply, or make a good-faith attempt to comply, with applicable public health regulations or guidance. Notable features of some state laws also include a limited window to file a claim (e.g., Mississippi), a rebuttable presumption that a customer who enters a business with a posted coronavirus warning has assumed the risk of contracting the virus (e.g., Georgia) and heightened injury requirements (e.g., Iowa).

The Current Proposed Federal Solution

Given the wide range of laws scattered across the country, the appeal of a uniform, nationwide law — particularly for businesses operating in multiple states or across state lines — is understandable. However, the SAFE TO WORK Act faces an uphill battle due to the stalled negotiations over the next coronavirus relief package and some unique features of the act itself. For example, the proposed law includes a one-year statute of limitations from the date of exposure to the virus, limitations on the types of recoverable damages, limitations on joint and several liability, restrictions on the timing and scope of discovery, a right to appeal the denial of a motion to dismiss, limitations on and notice requirements for class actions, as well as limitations, consent and special appellate rights for multidistrict litigation. The proposed law also includes special immunity provisions for employers, including protection from actions or personal injuries arising out of coronavirus testing at workplaces, and for owners, lessees and operators of places of public accommodation.

Of particular note, though, are the heightened burden of proof and pleading requirements that the federal law would require COVID-19 plaintiffs to meet, and the cause of action the law would create for those accused of exposing someone to the virus.

First, to succeed under the SAFE TO WORK Act, a plaintiff must prove by clear and convincing evidence that a defendant subject to civil immunity protections: 1) "was not making reasonable efforts in light of all the circumstances to comply with applicable government standards and guidance in effect at the time"; 2) "engaged in gross negligence or willful misconduct" that caused an actual exposure to coronavirus; and 3) the actual exposure caused personal injury to the plaintiff. Importantly, a defendant who maintained a written or published policy on mitigation of transmission of the virus at the time of the alleged exposure would be presumed to have made reasonable efforts, which, in turn, the plaintiff may rebut by showing that the defendant was not complying with its own policy. In order to succeed against a healthcare provider, a plaintiff must prove by clear and convincing evidence that the defendant 1) engaged in gross negligence or willful misconduct that 2) directly caused the alleged harm, damage, breach or tort resulting in the personal injury. Significantly, acts or omissions resulting from a resource or staffing shortage would not constitute gross negligence or willful misconduct by a healthcare provider.

Second, for any covered action filed in or removed to federal court, a plaintiff would be required to plead with particularity (a heightened pleading standard): 1) each element of the plaintiff's claim; 2) the identify of each defendant and the factual basis for the belief that a particular defendant caused the plaintiff's alleged injury; 3) every other person or place visited by the plaintiff and every person who visited the plaintiff's residence during the 14-day period prior to the onset of the plaintiff's symptoms, along with the factual basis for the plaintiff's belief that they did not cause his or her alleged injury; and 4) each alleged act or omission constituting gross negligence or willful misconduct. In addition, a plaintiff must file with the federal court "a statement of specific information as to the nature and amount of each element of damages and the factual basis for the damages calculation." Additionally, if a claim requires proof of a defendant's specific state of mind, the plaintiff must file a statement of the facts giving rise to a strong inference that the defendant acted with the required state of mind for each element of that claim. A plaintiff also must verify the complaint (i.e., swear under oath that the allegations are true to the best of his or her knowledge) and file with it an affidavit from a medical expert explaining the basis for the expert's belief that the plaintiff suffered the personal injury alleged in the complaint and certified medical records documenting that injury.

Third, the SAFE TO WORK Act would establish a cause of action that could be brought in state or federal court against anyone who transmits or causes someone to transmit a demand for payment in exchange for settling, releasing, waiving or otherwise not pursuing a meritless claim as part of a COVID-19-related action. It further provides for damages (including costs to respond to the demand), punitive damages (for claims that are knowingly meritless or demanded with reckless disregard for their merit), and attorneys' fees to only a prevailing plaintiff. The act would also empower the U.S. Attorney General to commence a civil action against any person or group that engages in a pattern or practice of transmitting meritless demands with up to $50,000 in civil fines for each transmitted demand, to be distributed equitably among those aggrieved by the demands.

While passage of the SAFE TO WORK Act faces significant challenges, there is strong desire by business owners, organizations, establishments and their legislative representatives to enact some form of uniform, nationwide COVID-19 liability protection. Until such time as federal uniform legislation passes, COVID-19 civil immunity will continue to vary across the country and be based on an ever-evolving array of state laws.

Protecting Your Business from Liability Amid the Uncertainty

Whether under federal or state law, the key to successfully invoking civil immunity from COVID-19-related actions is the ability to establish that your business made "reasonable" and "good-faith" efforts to comply with any applicable government standards and guidance in effect at any given time. As more fully covered in prior Holland & Knight alerts (see below), this includes taking proactive efforts, such as providing notice to third parties, implementing policies, developing safety and health programs, instituting protocols and conducting necessary training. Understanding both the applicable standards and guidance, as well as the governing or proposed immunity laws (many of which end up being retroactive) in the states where your company or organization conducts business will enable you to best protect your employees, customers and third parties, while also protecting against potential legal liability related to COVID-19 exposure.

For more information or assistance understanding COVID-19 civil immunity under specific enacted or proposed laws, as well as developing policies and programs to best position your business to defend against claims and invoke the laws' protections, please contact the authors, who are tracking developments on the federal proposal and ever-evolving state laws on COVID-19 civil immunity.

Additional Holland & Knight Resources

DISCLAIMER: Please note that the situation surrounding COVID-19 is evolving and that the subject matter discussed in these publications may change on a daily basis. Please contact your responsible Holland & Knight lawyer or the author of this alert for timely advice.

Information contained in this alert is for the general education and knowledge of our readers. It is not designed to be, and should not be used as, the sole source of information when analyzing and resolving a legal problem. Moreover, the laws of each jurisdiction are different and are constantly changing. If you have specific questions regarding a particular fact situation, we urge you to consult competent legal counsel.

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