Sens. Advance Bill Allowing Suits Against China Over COVID

By Andrew Kragie
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Law360 (July 30, 2020, 9:33 PM EDT) -- The Senate Judiciary Committee voted mostly along party lines Thursday to advance a Republican bill that would let American individuals, companies and states sue China over the health and economic consequences of the coronavirus pandemic.

The Civil Justice for Victims of China-Originated Viral Infections Diseases Act would amend the Foreign Sovereign Immunity Act, which normally blocks lawsuits against other countries in U.S. courts. The measure also would allow the seizure of Chinese assets in the U.S.

The bill's Republican sponsors said it was modeled on an overwhelmingly bipartisan bill that made Saudi Arabia and other countries liable if they're found to sponsor terrorism. Democrats questioned whether the change would open the U.S. to similar suits and cast the effort to focus on China as a distraction from the Trump administration's pandemic response. The measure is sponsored by Sen. Martha McSally, R-Ariz., with seven GOP cosponsors including committee Chairman Lindsey Graham, R-S.C.

"If you thought Saudi Arabia had some nefarious connections to terrorists, I guarantee you China's got some nefarious connections to how this virus started," Graham said. "I think they misled the world in a deceptive way, in a very hard-hearted fashion. They stopped travel in China but allowed people from China to go out and infect the world."

The panel's 13-9 vote saw Republicans joined by the Senate's second-ranking Democrat, Sen. Dick Durbin of Illinois, whose office did not respond to a request for comment.

Durbin voted for the measure after arguing that Republicans were being hypocritical in seeking pandemic liability for China while trying to limit it for schools, businesses and other entities in the next relief package. He also asked whether the U.S. might face liability for other coronavirus issues, such as deporting infected migrants to poor Central American countries with little public health infrastructure.

Graham dismissed that possibility: "If they want to sue us, they can. There's probably a reason they're not — because we're trying to help them the best we can with their economic problems."

The committee's top Democrat, Sen. Dianne Feinstein of California, argued that "if we eliminate sovereign immunity for countries engaging in reckless behavior that contributed to the spread of COVID-19, then other countries, including China, may very well do the same to us." The U.S. has 4% of the world's population but has seen 26% of the world's confirmed coronavirus cases, according to Johns Hopkins University.

Feinstein also argued the proposal made for bad foreign policy by antagonizing a major trading partner that is "growing into a respectable nation among other nations." She added that she had seen the Chinese ambassador Saturday and worried this measure would damage hopes for a "Pacific century" of U.S.-China cooperation.

Several GOP senators rejected that as coddling a bad actor.

"I'd like to have a better relationship with China, but it just doesn't seem to be going in the right direction," Graham said. "The Hong Kong special status has been virtually destroyed. They have concentration camps for religious minorities called the Uighurs. We had to close the Houston consulate down because they used their diplomatic footprint to spy and steal intellectual property," allegedly including COVID-19 vaccine research.

"We have to be realistic," argued Sen. Josh Hawley, R-Mo. "The 'Pacific century' has not arrived. It will not arrive. China does not seek cooperation with the United States in order to peacefully liberalize and become part of the 'family of nations,' whatever that means. They seek domination. And there is one thing standing between them and control of the international system, and that is the United States of America."

"They took our jobs, they sent us a virus and they need to be held to account," said Sen. Marsha Blackburn, R-Tenn.

Sen. Mike Lee, R-Utah, said after the vote that his support was "contingent on a statement that bill sponsors are going to work with me to increase the standard to intentional conduct." The current text sets the liability standard as "an omission or act that constitutes mere negligence."

As the law currently stands, virus lawsuits against China are likely to get dismissed, Bryan Cave Leighton Paisner LLP attorneys said in a Law360 guest column. Cases already filed include a suit by Missouri and proposed small-business class actions in California and Nevada.

Republicans have focused on China's actions early in the pandemic, saying the Communist Party stifled scientific transparency and allowed the virus to spread globally. Most Democrats have called the argument over China's culpability a useless distraction from the Trump administration's pandemic response.

"This president and this administration's massive failure in dealing with the pandemic in our own country makes me wonder why we're not focused on what's going on in our own country," said Sen. Mazie Hirono, D-Hawaii.

Democrats say Republicans are focusing on China as polls look bad for them ahead of November's election, which President Donald Trump on Thursday suggested he might try to postpone. Lawmakers in both parties said the constitutionally mandated election date will not change and cannot change without an act of Congress.

Sen. John Cornyn, R-Texas, noted that the proposed legislation is modeled on the Justice Against Sponsors of Terrorism Act, the measure he sponsored that let Americans pursue Saudi Arabia in federal court over allegations it supported the 9/11 hijackers. Congress passed the law in 2016 with bipartisan majorities to override a veto from President Barack Obama. The U.S. Supreme Court expanded the law's reach in May with a ruling that retroactively applied it to Sudan for an attack from 1998.

"If we could pass the Justice Against Sponsors of Terror Act as a result of a terrorist attack that killed 3,000 Americans, why would we sit on our hands after 153,000 Americans have lost their lives as a result of the COVID-19 virus?" Cornyn said. "Why would we treat the Communist Party in China any differently than the people who helped finance the terrorist attacks on our soil on 9/11?"

Sen. Richard Blumenthal, D-Conn., cosponsored JASTA and said he helped lead the override effort. He called the pandemic liability bill poorly framed and part of "an effort to distract," but added that he might support a more narrowly framed measure: "I want to hold China accountable if it committed wrongdoing or hid information that it should have revealed."

After committee approval, the bill is up for a vote in the full Senate. To become law, it would also need approval in the Democratic-led House, which a Democratic House aide told Law360 was hard to imagine.

The Senate is the more likely place for bipartisan deal-making, the aide said, so Democratic opposition on the Senate Judiciary Committee means the proposal is not likely to become law even if it passes the Senate. The aide noted that there was broad bipartisan support for the terrorism-related exception, but said Democrats view the China bill as a GOP effort to deflect attention from the Trump administration's pandemic response.

--Editing by Adam LoBelia.

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