Apr 30, 2020 - Economy & Business

Jackpot for liability lawyers

Illustration: Sarah Grillo/Axios

President Trump’s order to reopen meat processing plants, despite the fact that they're coronavirus hot spots, raises a tangle of liability issues that could keep courts and trial lawyers busy for years.

Why it matters: The scrap over meat plants — which is just heating up — may be a microcosm of the ones other businesses will face once commerce opens up more broadly.

What they're saying: As corporate responsibility for workers' and customers' COVID-19 infections turns into a political and financial flashpoint, the beneficiaries will likely be trial lawyers, bringing torts of all kinds.

  • "I envision that you are going to see a spike in litigation," Eric Swan, a tort litigation attorney at Lathrop GPM, tells Axios. "You're going to see personal injury claims from consumers against businesses — you're already seeing this a little bit with employees against employers."
  • He cited a wrongful death suit against Walmart in Illinois brought by the family of an employee who died of COVID-19. The family said the company didn't do enough to protect him.

Driving the news: Meat processing workers, many of them low-income immigrants and minorities, are being recalled to plants where thousands have been sickened. If the administration has its way, their employers will enjoy liability protection, shielding them from lawsuits brought by workers or their family members who contracted COVID-19.

But the issue is fraught. On one side are groups like the U.S. Chamber of Commerce, which sent a letter to Trump on Tuesday pushing him to curb the amount of liability businesses could face.

  • The letter warned against a scenario where "government bureaucrats enforcing a rule book of regulations" could "issue fines when they find a sneeze guard out of place."
  • The letter was delivered to a receptive audience: Trump and his chief economic advisor, Larry Kudlow, are said to be in favor of a "liability shield" that would "prevent businesses from being sued by customers who contract the coronavirus," per the Washington Post.

On the other side are consumer advocates and unions, some of which sent a letter to Congress saying, "legal liability is one of the most powerful incentives we have to ensure that businesses operate safely."

  • Democratic Sen. Mazie Hirono of Hawaii tweeted: "Forcing meat processing plants to stay open without adequate worker protections while shielding owners from liability just for @realDonaldTrump's personal, political benefit demonstrates a callous disregard for human life."

Details: Lawyers say the meat producers being forced to reopen plants — like Tyson Foods, Conagra, Smithfield Foods, JBS and Cargill — could face a range of legal challenges if their workers get sick or if they're unable to honor contracts with suppliers and customers.

  • "What if I get sick at work, and I can show that my employer didn't take enough steps to prevent that colleague next to me from from coming in?" Omer Tene of the International Association of Privacy Professionals tells Axios.
  • A "force majeure" clause in a contract that frees both parties from liability in the event of extraordinary circumstances could suddenly be nullified, leaving the meat company with contracts to fill and cattle it's obliged to buy, David Domina, a trial practice lawyer in Omaha, tells Axios.
  • And a big percentage of workers could call in sick, leaving the plant unable to function at full capacity.
  • "The overwhelming majority of the workforce could have worker's comp claims," Domina says.

Even before the president's order on Tuesday, workers at a Smithfield Foods pork processing plant in Milan, Mo. — which has not closed — sued the company, seeking an injunction until more safety measures are put in place.

  • An anonymous plaintiff who works at the plant wrote an impassioned article in the Washington Post saying, "managers never blatantly asked me to risk my life just by showing up — until this pandemic."

The bottom line: No business will be immune from the possibility of liability lawsuits as the nation opens up again.

Go deeper

Cities' budget woes worsen with increased social unrest

Illustration: Sarah Grillo/Axios

Cities were already furloughing workers and considering cutting back essential services — including public safety — because of the dramatic drops in the local tax revenue that funds them. Now they're also dealing with turmoil in their streets.

Why it matters: "Unfortunately, the increasing levels of social unrest across the country reallocated efforts and scarce resources away from the former focus of getting state, regional and local economies back to some semblance of normalcy," per Tom Kozlik, head of municipal strategy and credit at HilltopSecurities.

Updated 18 hours ago - Health

U.S. coronavirus updates

Data: The Center for Systems Science and Engineering at Johns Hopkins; Map: Andrew Witherspoon/Axios. This graphic includes "probable deaths" that New York City began reporting on April 14.

The Department of Health and Human Services moved on Thursday to require that an individual's race, ethnicity, age and sex be submitted to the agency with novel coronavirus test results.

Why it matters: Some cities and states have reported the virus is killing black people at disproportionately high rates. There are gaps in the national picture of how many people of color are affected, since the data has not been a requirement for states to collect or disclose.

Jun 3, 2020 - Health

DeSantis says Florida bars and clubs can reopen this week

Outdoor restaurant in Fort Lauderdale on May 18. Photo: Chandan Khanna/AFP via Getty Images

Florida Gov. Ron DeSantis said Wednesday that bars and clubs will be allowed to reopen on Friday, as the state continues to scale down restrictions it put in place because of the coronavirus, WCTV reports.

Why it matters: DeSantis ordered bars and clubs to close in mid-March as one of the first actions the state took to stem the spread of the coronavirus.