Congress Must Act to Protect Business Against Looming Lawsuit Threat Print
By Timothy H. Lee
Thursday, May 14 2020
Anyone who behaves recklessly or deliberately should be held accountable for their wrongs in our legal system, but businesses shouldn’t be terrified into dormancy by the mere threat of devastating lawsuits.

As America struggles to regain its footing, employers large and small face a potentially harrowing dilemma. 

On the one hand, they cannot remain dormant indefinitely, and must reopen for business as soon as feasible and allow increasingly desperate employees to resume earning a living.  On the other hand, they must also protect employees and patrons alike against ongoing coronavirus health hazards. 

Compounding that peril is the looming threat of opportunistic, predatory plaintiff lawyers awaiting any opportunity to swoop down to file crippling lawsuits for alleged missteps. 

Congress can help alleviate that needless threat, and accelerate our national recovery. 

At the state level, governors across America are already showing the way by expanding liability protections under state and local laws, granting greater immunity to healthcare workers, waiving professional licensing mandates and discouraging frivolous lawsuits in state courts. 

Unfortunately, state-level protections only go so far, and not all governors demonstrate the fortitude to stand up against powerful lawyer interests.  Moreover, the interstate nature of today’s economy demands that Congress act on a nationwide level. 

Until that occurs, we’ll continue to witness the onslaught of dubious lawsuits as businesses attempt to survive amid the crippling economic downturn.  Healthcare suppliers, grocery stores, universities, airlines, cruise lines, nursing homes, food suppliers and even medical volunteers have already been targeted, and lawsuits will only increase as economic activity resumes and pandemic treatment efforts continue. 

To provide greater nationwide assurance to businesses and healthcare providers, Congress can quickly pass legislation requiring lawsuits to allege actual, serious injury rather than speculative harms or merely non-substantive allegations like emotional distress.  Reasonable people would agree under today’s pressing circumstances that a lawsuit should at a minimum specify identifiable damages such as permanent health consequences or injuries that demanded actual medical care. 

Congress should further restrict lawsuits to instances of employer recklessness or intentional disregard, as opposed to honest mistakes when they complied with applicable federal, state or local guidelines in reopening.  Anyone who behaves recklessly or deliberately should be held accountable for their wrongs in our legal system, but businesses shouldn’t be terrified into dormancy by the mere threat of devastating lawsuits. 

Federal legislation should also set nationwide standards to prohibit forum-shopping by plaintiffs’ attorneys, and responsible limits on seeking class-action status. 

In terms of lawsuits specifically relating to healthcare providers or efforts to develop coronavirus vaccines or treatments, Congress should encourage honest effort, investment and experimentation by requiring lawsuits to demonstrate gross negligence.  Otherwise, companies like breweries that have shifted to producing sanitizers or auto manufacturers that have shifted to producing ventilators will be discouraged by the prospect of product liability for unintentional design or manufacturing flaws. 

Senate Majority Leader Mitch McConnell (R – Kentucky) deserves immense credit for insisting that liability protections be included in any new pandemic legislation, and the Trump Administration also supports that effort. 

Additionally, an impressive coalition of trade groups representing millions of American workers, including airlines, amusement parks, casinos, cinemas, hotels and restaurants wrote Congress this week, stating that, “We fear that without Congressional action, the threat of litigation will mire our recovery and negatively impact the economy writ large by injecting great uncertainty and risk into the ability of our businesses to operate during the pandemic.” 

The effort also claims bipartisan support, with such figures as Democrat and The New Center founder William Galston summarizing what differentiates today from ordinary conditions: 

Some economists and workers’ advocates argue that there’s no need for new employer protections because existing tort law already strikes the right balance.  If employers operate their businesses in ways that expose workers to avoidable risks, they increase their risk of litigation, so they have an incentive to do the right thing. 

In ordinary circumstances, this argument makes sense.  When a workplace injury occurs, it is usually possible to determine whether the injury is causally linked to performing job-related activities.  But the pandemic is different.  Even the most stringent safety standards will be imperfect.  Employees who test negative for Covid-19 may subsequently develop the disease.  Employees may test positive for the disease without having contracted it in the workplace.  Employers who do everything possible to prevent the virus from spreading to and within their businesses shouldn’t be held liable for what they cannot control. 

Regrettably but unsurprisingly, far-left leaders like Speaker of the House Nancy Pelosi (D – California) and Senate Minority Leader Chuck Schumer (D – New York) oppose these commonsense legislative measures as some sort of free pass to big businesses. 

The truth, however, is the opposite.  The people most in need of jobs and coronavirus treatments are everyday Americans enduring deepening financial stress and health concerns. 

By passing legal reform to address new conditions brought by the coronavirus pandemic, Congress can help middle- and lower-income Americans, while helping speed the nation’s recovery.  There’s no time to waste.