Roundup: First COVID-19 suits filed; states and feds weigh legislation
(March 13, 2020) - The first lawsuits involving the novel coronavirus have been filed in the U.S. over effects of the global pandemic. Meanwhile, Congress and state legislatures are rushing to pass legislation related to COVID-19. Below is a roundup of recent developments.
Chinese government sued
A group of business owners and individuals has filed a proposed class-action lawsuit against the People’s Republic of China and related government entities for allegedly failing to contain the spread of COVID-19.
”The PRC and other defendants, acting from their own economic self-interest and looking to protect their place as a superpower, failed to report the outbreak as quickly as they could have; underreported cases; and failed to contain the outbreak despite knowing the seriousness of the situation,” the complaint says.
The complaint, filed March 13 in the U.S. District Court for the Southern District of Florida, brings claims for negligence, negligent and intentional infliction of emotional distress, strict liability for conducting “ultrahazardous activity,” and public nuisance. Alters v. People’s Republic of China, No. 20-cv-21108, complaint filed (S.D. Fla. Mar. 13, 2020).
Buzzfeed files FOIA suit
Online news outlet Buzzfeed and one of its senior reporters, Jason Leopold, have filed a Freedom of Information Act lawsuit against the Centers for Disease Control and Prevention and the Federal Emergency Management Agency, alleging they have refused to respond to the company’s requests for information about their handling of the COVID-19 outbreak.
The plaintiffs say they filed a request with the CDC on Feb. 12, seeking internal CDC studies on the coronavirus, all policy and legal guidance the organization provided to its staff, and internal memos and letters that mention COVID-19.
They later narrowed the request and limited the time frame for which they sought the information, but the CDC has yet to respond to the request, the complaint says.
The plaintiffs also filed an FOIA request with FEMA Feb. 12, seeking disclosure of contingency plans and related emails, letters and memos, the complaint says. Although the plaintiffs later narrowed the scope of the request, FEMA has yet to respond, according to the complaint. Leopold v. Centers for Disease Control, No. 20-cv-722, complaint filed (D.D.C. Mar. 13, 2020).
Shareholder sues cruise line
A shareholder of Norwegian Cruise Lines has sued the company and two of its executives March 12 in Miami federal court, alleging the defendants misrepresented the effect COVID-19 would have on its business and thereby artificially inflated the stock price.
According to the complaint, the Miami-based cruise line, CEO and President Frank J. Del Rio and Chief Financial Officer Mark A. Kempa made false statements in a Feb. 20 Form 8-K and a Feb. 27 Form 10-K filed with the Securities and Exchange Commission.
The defendants claimed the company’s financial outlook was positive despite the risks to its business posed by COVID-19, and said the company placed “the utmost importance on the safety of our guests and crew,” the suit says.
But the truth emerged in early March when the Washington Post and the Miami New Times reported that leaked documents showed the company had directed its sales force to lie to customers about COVID-19 to increase bookings, the complaint says. Douglas v. Norwegian Cruise Lines, No. 20-cv-21107, complaint filed (S.D. Fla. Mar. 12, 2020).
Lyft, Uber drivers seek paid sick days
Two proposed class-action lawsuits have been filed in California Superior Court in San Francisco alleging Uber and Lyft fail to provide their drivers with paid sick time, in violation of Section 246 of the California Labor Code, Cal. Lab. Code § 246.
The ride-hailing companies unlawfully misclassify the drivers as independent contractors rather than employees to avoid the state’s requirement that people who work for the same employer for 30 or more days within a year of starting employment receive paid sick time, the suits say. Verhines v. Uber Techs. Inc., No. CGC-20-583684, complaint filed, 2020 WL 1187253 (Cal. Super. Ct., S.F. Cty. Mar. 12, 2020); Rogers v. Lyft Inc., No. CGC-20-583685, complaint filed, 2020 WL 1187390 (Cal. Super. Ct., S.F. Cty. Mar. 12, 2020).
Cruise passengers sue Princess
Two Princess Cruise Lines passengers allege they are at risk of contracting COVID-19 after sailing on the Grand Princess, which left San Francisco Feb. 21 and has been docked at the Port of Oakland since March 9.
The defendant proceeded with the trip despite knowing that two passengers who disembarked Feb. 21 after the ship’s prior cruise had coronavirus symptoms, the complaint filed March 9 in the U.S. District Court for the Central District of California alleges.
The company failed to implement proper screening procedures and took a “lackadaisical approach” to customer safety, the complaint filed by the married couple Ronald and Eva Weissberger says. Weissberger v. Princess Cruise Lines Ltd., No. 20-cv-2267, complaint filed, 2020 WL 1151023 (C.D. Cal. Mar. 9, 2020).
Software company seeks to kill deal with band
A Utah software company has sued an entertainment firm, alleging the defendant is refusing to allow the company to cancel its contract with the band The Killers to perform at its now-postponed management summit.
According to the complaint, Qualtrics LLC postponed the gathering, which was slated to draw some 16,000 people to Salt Lake City from March 10 to 13, due to concerns over the spread of COVID-19.
Qualtrics had entered into a contract with defendant SME Entertainment Group LLC to secure The Killers for a March 12 performance, the complaint says.
The plaintiff says it has the right to cancel the contract under certain circumstances, and it did so “based upon expert advice regarding the spread and risks posed by COVID-19 to its attendees and the general public.” Qualtrics LLC v. SME Entertainment Group LLC, No. 20-cv-164, complaint filed, 2020 WL 1182395 (D. Utah Mar. 12, 2020).
Congress and the Trump administration are moving closer to enacting legislation to boost the economy during the COVID-19 outbreak, according to a March 13 Reuters report.
The Families First Coronavirus Response Act includes free COVID-19 testing for anyone who needs it, including people without health insurance; paid emergency leave, including 14 days of paid sick time; enhanced unemployment benefits; food security initiatives; protections for health care workers and other front-line responders, and increased federal funds for Medicaid, according to a March 11 statement from House Speaker Nancy Pelosi’s office.
The House is expected to vote late Friday on the measure, but it is unclear how the Republican-controlled Senate will act, according to Reuters.
States enact measures
Hawaii, Maryland, Massachusetts, Minnesota and New York have adopted legislation related to COVID-19, including the following:
In Hawaii, HR 54 creates a select house committee on COVID-19 economic and financial preparedness.
Maryland’s SB 1079 permits the governor to transfer up to $50 million from the state’s revenue stabilization account to pay for COVID-19 response costs.
In Massachusetts, HB 4502 allows the state to spend up to $95,000 on prevention, treatment and containment of the novel coronavirus, and requires a report to the legislature by June 1 on all COVID-19-related activities.
Minnesota’s SF 3813 authorizes a one-time $20 million transfer of money from the general fund to the state’s public health response contingency account.
In New York, SB 7919 appropriates $40 million from the state’s general fund for costs associated with responding to the outbreak, and temporarily gives the governor authority to issue any needed directives related to the outbreak by executive order.
Numerous other states have pending COVID-19 legislation, including Arizona, Illinois, Kentucky, South Carolina, Tennessee and Washington state, according to the National Conference of State Legislatures.
DOL issues guidance
The U.S. Labor Department issued guidance March 12 explaining the circumstances under which states can pay unemployment insurance benefits to workers affected by COVID-19. U.S. Department of Labor Announces New Guidance on Unemployment Insurance Flexibilities During COVID-19 Outbreak, Release No. 20-448-NAT, 2020 WL 1181987 (Mar. 12, 2020).
Federal law gives states “significant flexibility” in paying unemployment benefits, the guidance says, citing several situations as examples.
According to the guidance, states are permitted to pay benefits to employees who are unable to work because their employer ceased operating due to the coronavirus; workers who are quarantined with the expectation they will return to work; and employees who leave their jobs because of the risk of becoming infected or to care for ill family members.
Workers who are receiving paid sick leave or family leave are not eligible for unemployment benefits, the DOL said.