Coronavirus Litigation: The Week In Review

By Celeste Bott
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Law360 (January 21, 2021, 10:18 PM EST) -- Verizon has escaped a $28 million lawsuit accusing it of spreading COVID-19, a coronavirus tracking application says Apple blocked it from its App Store to limit competition, and Enterprise wants an appeals court to consider whether the pandemic falls under the WARN Act's natural disaster exception. 

While courts across the country are altering procedures, restricting access and postponing certain cases to stem the spread of the coronavirus, the outbreak has also prompted a wave of litigation across the country.

Here's a breakdown of some of the COVID-19-related cases from the past week.


Enterprise asked a Florida federal judge Tuesday for permission to appeal an order that rejected the car rental company's legal argument that it can't be liable for unplanned layoffs as a result of the novel coronavirus, arguing the appeals court should address whether the pandemic falls under the WARN Act's natural disaster exception.

U.S. District Judge Roy B. Dalton's ruling allowing a proposed class action against Enterprise Holdings — the parent of car rental firms Enterprise Rent-A-Car, Alamo Rent a Car and others — to proceed "precludes application of the natural disaster exception with respect to any and all COVID-19 layoffs," Enterprise said in its motion.

The company argued that the appeals court should take a crack at the threshold issue of whether Enterprise can assert a defense that the COVID-19 pandemic falls under the natural disaster exception in the Worker Adjustment and Retraining Notification Act before the litigation continues.

A Pennsylvania federal judge has blocked a policy of the Port Authority of Allegheny County that prohibited employees from wearing "Black Lives Matter" face masks at work, finding that the policy runs "afoul of the First Amendment."

In a 45-page opinion Tuesday, U.S. District Judge J. Nicholas Ranjan granted a preliminary injunction against enforcing the mask policy. Amalgamated Transit Union Local 85, a union representing employees at the Port Authority, filed suit against the transit agency in September. In its suit, the union argued that the policy banning workers from wearing Black Lives Matter face masks violates their freedom of speech.

In another matter, audiovisual technicians for an event services provider cannot vote to unionize because the company laid them off due to the coronavirus pandemic with no expectation of their returning anytime soon, a National Labor Relations Board official has ruled.

An NLRB regional director dismissed the petition by International Alliance of Theatrical Stage Employees and Moving Picture Machine Operators of the United States and Canada Local 611 for an election among Audio Visual Services Group LLC technicians in Monterey, California, in a supplemental decision and order Thursday. The official said that even though the company characterized the layoffs as temporary furloughs, the future was uncertain enough to prohibit an election under board standards.

Legal Industry

A former Goosehead Insurance in-house attorney who was fired earlier this month for his apparent involvement with the mob that stormed the U.S. Capitol has filed a suit on behalf of Donald Trump voters claiming that their rights were violated by coronavirus-inspired changes to voting rules.

Paul M. Davis' attorney caption in the Texas federal court case, which he filed on Monday on behalf of Latinos for Trump and Blacks for Trump, refers to him as "Former Associate General Counsel of Goosehead Insurance Inc. (Terminated after peacefully protesting) Now Solo Civil Rights Attorney." He is not a party to the suit.

The complaint, which names all members of the new U.S. Congress as well as Facebook founder Mark Zuckerberg, had aimed to halt the inauguration of President Joe Biden and show how "pervasive changes" to election rules in every state in response to the COVID-19 pandemic violated the 2002 Help America Vote Act.

Public Policy

California Gov. Gavin Newsom and other state leaders were hit Tuesday with a proposed federal class action suit challenging the state's coronavirus regulations prohibiting barbering and cosmetology professionals from operating their businesses, likening them to a seizure of private property for public benefit without just compensation.

Tatoma Inc., which operates Atelier Aucoin Salon in La Jolla, California, filed the suit against the governor, Attorney General Xavier Becerra and Kristy Underwood, executive officer of the State Board of Barbering and Cosmetology, alleging state-issued shutdown orders for barbers, hair salons and other cosmetology-based businesses violate the Fifth and 14th amendments, as well as various state laws.

Because the orders closing the businesses, among other things, rendered state-issued barber and cosmetology licenses obsolete for a public benefit, the state seized their property without compensation in violation of the takings clause of the Fifth Amendment, Tatoma argued.

Also in California, a San Diego church that failed to beat the state's pandemic restrictions at the U.S. Supreme Court has urged the Ninth Circuit to reconsider its request, arguing that a subsequent high court decision striking down rules on religious gatherings in New York favors axing California's rules.

South Bay United Pentecostal Church's attorney Charles S. LiMandri told the three-judge panel during video oral arguments that churches are essential services under the First Amendment, and it's not fair for California to allow grocery stores, marijuana dispensaries and shopping malls to stay open while denying houses of worship the ability to hold indoor services.


Children of undocumented immigrants don't qualify for the $500 coronavirus relief payments provided by last spring's stimulus bill even though they are U.S. citizens, the federal government told a federal court.

The $500-per-child payments established by the Coronavirus Aid, Relief and Economic Security Act are made as tax credits directly to taxpayers who have valid Social Security numbers, not to their children, the government said in a motion filed Friday. The motion sought the dismissal of a proposed class action against the government.

The suit, filed last May, seeks approval of a nationwide class consisting of U.S. citizen children under 17 who have been denied CARES Act economic relief payments. The group consists of seven American children and their immigrant parents, according to the filing. They are identified only by initials.

Personal Injury & Medical Malpractice

Plaintiffs suing an Illinois nursing home over a coronavirus outbreak that killed at least 12 residents said Monday that the home is making a "circular" argument by trying to dismiss a trio of suits under both a gubernatorial order shielding health care providers from COVID-19 suits and a state law governing nursing home care.

The suits filed by Eileen Walsh — the estate administrator for deceased resident Rita Saunders — and others claim that Westchester Health and Rehabilitation Center, a long-term care facility that had 47 confirmed cases of COVID-19 and at least 12 deaths, failed to implement proper infection control protocols and negligently allowed symptomatic workers to treat patients without wearing personal protective equipment, in violation of federal health guidelines.

In response to Westchester's November motion to dismiss the three suits, the plaintiffs said Monday that Westchester's parent company is trying to "have it both ways" by asserting that the claims are invalid under both Gov. J.B. Pritzker's executive order and the Illinois Nursing Home Care Act.

"[Westchester] asserts that no current cause of action exists for negligence under the Illinois Nursing Home Care Act (INHCA) because of a gubernatorial executive order," the plaintiffs said, referring to Pritzker's April 1 executive order granting civil immunity to health care providers rendering medical treatment in support of the COVID-19 outbreak, absent gross negligence or willful misconduct.

"It then argues no cause of action exists under the executive order because the higher liability standards it imposes are not part of the INHCA," the filing states. "Each alternative basis for liability prevents the other from being operable, abrogating all possible liability for its misconduct. The circular nature of its argument betrays the poverty of its position."

Food & Beverage

A Pittsburgh-area restaurant that has been operating in defiance of Pennsylvania's COVID-19-related mask mandate asked a federal bankruptcy judge to extend a stay on the Allegheny County Health Department's effort to shut the eatery down, citing its appeal to the U.S. District Court.

The Cracked Egg urged U.S. Bankruptcy Judge Jeffery Deller to put back in place a stay on the county's enforcement action pending the restaurant's district court appeal of his order, or until a pending action in federal court challenging the constitutionality of Pennsylvania's mask mandate is resolved.

The restaurant said Judge Deller erroneously held that his court lacked the authority to decide whether the exercise of the police power was legitimate.

And a judge in Baltimore has upheld the city's on-premises dining ban due to COVID-19, denying the Restaurant Association of Maryland's lawsuit seeking a temporary restraining order so that financially distressed eateries can serve customers on their premises during the pandemic.

Baltimore City Circuit Court Judge Lawrence P. Fletcher-Hill denied the Maryland trade group's temporary restraining order petition in an open court proceeding where he heard the restaurants' arguments before deciding in favor of Baltimore Mayor Brandon M. Scott and the city council. Dozens of restaurant companies joined the association in its complaint.


Cincinnati Insurance Co. has urged the Eighth Circuit to affirm that it is not responsible for covering an Iowa dental practice's lost income due to COVID-19 closure orders, arguing that a large body of case law supports the trial court's conclusion that the practice's losses did not result from a covered loss of property.

Cincinnati told the appellate court that U.S. District Judge Charles Wolle got it right in late September when he ruled that Des Moines, Iowa-based Oral Surgeons PC did not state viable claims for business income, extra expense or civil authority coverage under its property policy with the insurer.

Judge Wolle found that Oral Surgeons' temporary loss of the ability to fully operate its business due to statewide restrictions on dental practices did not qualify as a covered loss, which is defined in the Cincinnati policy as "accidental physical loss" or "accidental physical damage." Cincinnati argued in its appellate brief that the decision should stand, pointing out that two other Iowa federal judges and more than 70 federal judges in other states have thrown out policyholders' claims for pandemic-related coverage for similar reasons.

An Ohio federal judge has asked the state high court to certify whether COVID-19 causes property damage covered in insurance policies, saying that such "unresolved" questions of Ohio law belong to the Ohio Supreme Court to ensure uniformity of state law applications.

U.S. District Judge Benita Y. Pearson on Tuesday refused to rule on whether Cincinnati Insurance Co. should pay for an Ohio audiology practice's business loss due to the pandemic and state-mandated closures. The judge said that the Ohio Supreme Court should certify the question of whether the existence of COVID-19 on a property or the presence of a person infected with the virus in a premise constitutes direct physical loss or damage on a covered property.

Also in Ohio, a federal judge has ruled that Zurich American Insurance Co. must cover losses suffered by more than a dozen steak and seafood restaurants due to COVID-19 shutdown orders, finding that the eateries' policy can reasonably be interpreted to cover the loss of use of property.

U.S. District Judge Dan Aaron Polster found Tuesday that Zurich had breached its obligation to provide lost business income coverage to Henderson Road Restaurant System and a slew of related companies that operate 16 restaurants in Ohio, Michigan, Florida, Indiana and Pennsylvania, including 13 locations of the Hyde Park Prime Steakhouse chain.

In New Jersey, a federal judge has handed Arch Insurance Co. a win in a lawsuit by several Minor League Baseball teams that claimed it wrongly denied coverage for COVID-19 related losses, finding the teams failed to allege any physical loss or damage that would trigger their policies.

In a letter order filed Tuesday, U.S. District Judge Susan D. Wigenton threw out two counts of the complaint by Everett AquaSox owner 7th Inning Stretch LLC and Asheville Tourists owner DeWine Seeds Silver Dollars Baseball, saying they failed to state a claim. According to the order, each of the coverage provisions the teams cite require "direct physical loss or damage to property," but the teams haven't alleged such a loss. Instead, the judge wrote, the teams only allege that stay-at-home orders and other government action forced the cancelation of the season, and the resulting loss of income.

A federal judge has also tossed a Pennsylvania restaurant's proposed class action seeking coverage from National Fire & Marine Insurance Co. for losses due to the coronavirus, finding that establishments limited to carry-out service had not sustained the "direct, physical loss" necessary to trigger their insurance policies.

U.S. District Judge William S. Stickman IV said that 1 S.A.N.T. Inc., which operates the Town & Country Bar & Grill and Gatherings Banquet and Event Center in New Castle, had not sustained a direct, physical loss under the common definitions of the words and had not lost all access to their premises under state orders limiting indoor dining during the pandemic.

And the Western Union Co. has lobbed a virus coverage suit at Chubb, telling a Colorado federal court that the Pennsylvania-based insurer has unlawfully refused to cover the company's losses stemming from pandemic-related business interruptions.

Western Union offers money transfer and payment services, generating most of its revenue from consumer-to-consumer transfers, according to the complaint. Western Union purchased an "all-risk" policy from Chubb that covered property damage or loss and business interruptions between October 2019 and October 2020, it says.

Notably, the policy covered "interruptions where access to Western Union's property or the property of Western Union's suppliers or customers is impaired by order of civil authority," Western Union said. Chubb chose not to include a virus exclusion in the policy, Western Union says.


Apple used trumped-up excuses to keep coronavirus tracking applications out of the App Store in order to ensure the tech giant wouldn't have any competition when it launched its own version of a COVID-19 tracker, according to a new lawsuit.

There was "no good reason" for Apple to block Coronavirus Reporter from being made available in its App Store in March, just as the virus was beginning its deadly march across the country — except that Apple knew it had its own application in the pipeline, a New Hampshire federal court was told Tuesday.

In doing so, the suit claims, Apple "den[ied] millions of citizens the benefit of communicating in a pandemic emergency using an app designed by a world-renowned physician."

Consumer Protection

A Georgia federal judge freed Verizon from an Atlanta-area attorney's proposed $28 million class action accusing the telecommunications company of spreading COVID-19, exposing neighborhood residents to harmful technology and diminishing property values by installing 5G infrastructure.

U.S. District Judge Leigh Martin May said Tuesday that plaintiff William F. "Bill" Kaspers, whose firm is Kaspers and Associates Law Offices LLC, failed to show that unacceptable levels of radiofrequency emissions would be emitted from a 5G transmission pole in his front yard. She said Kaspers also failed to properly state his claims against Verizon of fraud, unlawful taking and intentional infliction of emotional distress.

Kaspers claimed in May that unmasked Verizon subcontractors were on his Sandy Springs property in March preparing to install a 5G pole. He sought for himself and his neighbors in the Derby Hills subdivision $14.1 million to compensate for an anticipated 20% devaluation of their 110 homes, plus the same amount again as punitive damages, suggesting they were exposed to COVID-19 and radio frequency-related illness.

--Additional reporting by Daphne Zhang, Nadia Dreid, Rosie Manins, Jeff Sistrunk, Mike Curley, Carolina Bolado, Melissa Angell, Dave Simpson, Craig Clough, Y. Peter Kang, David Hansen, Lauren Berg, Reenat Sinay, Matthew Santoni, Hannah Albarazi, Max Kutner, Hailey Konnath and Joyce Hanson. Editing by Michael Watanabe.

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