Business Suits Over Virus Rules Likely To Fail, But Not Slow

By Jack Karp
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Law360 (March 4, 2021, 12:58 PM EST) -- The many constitutional challenges to coronavirus restrictions that businesses have launched are unlikely to succeed, but their proliferation worries public health law experts, who say more are coming and even those that fail can undermine public health measures, now and for future pandemics.

Business owners have been challenging restrictions like closure orders and capacity limits since early in the health crisis, but with the pandemic nearly a year old, the number and pace of these lawsuits is exploding, public health attorneys say.

"This is really something that's building momentum right now," said Jen Piatt, a senior attorney at the Network for Public Health Law who has been tracking these cases. "People are talking about it, people are thinking about it."

Constitutional Challenges

Georgia business owners sued Gov. Brian Kemp last month, arguing that his emergency orders shuttering their businesses during the pandemic violate both the Georgia and U.S. constitutions.

Lodging owners in a California resort town sued Gov. Gavin Newsom, claiming his stay-at-home and business closure orders violate the Fifth and 14th amendments and the commerce clause of the U.S. Constitution.

Arcade chain Dave & Buster's Inc. sued New York Gov. Andrew Cuomo, alleging that his decision to allow casinos and bowling alleys but not arcades to reopen violated the First and 14th amendments and the New York Constitution.

Those are just the suits filed in the first three days of February.

"The extent, the breadth of COVID-19 has made it easier for people to bring these kinds of challenges because it has been going on for so long," Piatt said. At least 100 such suits have been filed around the country, she said.

Many of the suits make similar claims that the health precautions violate the federal and sometimes state constitutions, Piatt said. The claims most often implicate due process and equal protection provisions, such as insisting the government is treating two similarly situated classes of businesses, such as "essential" and "nonessential" businesses, differently.

"The business community is frustrated with the distinctions the state has drawn between various sectors of the economy," said Christopher Wheeler, a Farella Braun & Martel LLP partner who focuses on complex health care litigation.

That's certainly how some business owners in Georgia feel, according to Jordan "Alex" Johnson of Bernard & Johnson LLC.

He recently sued that state's governor making many of these constitutional claims on behalf of a dance school operator, a barber and the owners of martial arts and pedicab businesses, among others, who lost income due to the governor's executive orders.

His complaint alleges those restrictions violate the Constitution's dormant commerce clause because they restrict commerce, the equal protection clause because they don't apply equally to businesses deemed "essential services" and the due process and takings clauses by taking significant portions of his clients' business without notice or an opportunity to be heard.

The suit, somewhat uniquely, also claims violations of the First Amendment's right to assembly on behalf of individuals who were kept from seeing elderly, sick or dying family members, Johnson said.

"By having the executive orders struck down, my clients hope to help Georgians' lives return to normal, as well as for some to receive compensation for their damaged livelihoods," he said.

Rational Basis Scrutiny

Despite their growing number, most of these suits are likely to fail, according to health law attorneys.

A Florida federal judge has already thrown out a Miami strip club's curfew challenge, finding in February that it didn't intrude on constitutional rights without adequate justification. The First Circuit denied a challenge to Maine's mandatory quarantine order in January. And in December, a Pennsylvania federal judge refused to block Philadelphia's ban on large public gatherings.

Courts largely defer to public health officials' judgment ever since the U.S. Supreme Court ruled in 1905 in Jacobson v. Massachusetts that a state had the power to enforce compulsory vaccination laws to prevent smallpox, according to Polly Price, a law and global health professor at Emory University.

Thus, judges hearing these suits have been applying the rational basis standard of constitutional review, which requires only that government regulations be rationally related to a legitimate government purpose, Price said.

That standard means that as long as a state can show its coronavirus rules are based on scientific evidence, it's unlikely a court will overturn the restrictions, Price said. And states can simply point to the U.S. Centers for Disease Control and Prevention's current guidelines.

"Rational basis scrutiny for litigants is a really, really hard hurdle to get past," Piatt said.

A rare few lawsuits have gotten past it, at least for now.

In Butler County et al. v. Wolf, a Pennsylvania federal judge struck down emergency business closure and crowd restrictions imposed by Gov. Tom Wolf, siding with a group of businesses and lawmakers who alleged the restrictions violated their constitutional rights.

"The solution to a national crisis can never be permitted to supersede the commitment to individual liberty that stands as the foundation of the American experiment," U.S. District Judge William Stickman IV wrote in his September opinion.

And while the decision has been stayed by the Third Circuit during appeal, it still worries public health law experts.

"I worry a great deal when judges substitute their judgment for that of experienced public health officials," said Lawrence Gostin, a professor of global health law at Georgetown University Law Center. "Judges should not be second-guessing scientific judgments or micromanaging public health actions."

The Suits' Impact, Now and in the Future

Those concerns aren't alleviated even when judges rule against the businesses bringing these suits. Cases like the Butler County one often result in preliminary injunctions or temporary restraining orders even if they lose in the end, Price said.

In New York, a preliminary injunction granted by Justice Timothy Walker in February, for instance, allowed more than 90 bars and restaurants challenging the state's coronavirus-related curfew to stay open until 4 a.m.

"Our clients were being put out of business," said Steven Cohen of HoganWillig PLLC, which filed the suit citing the equal protection clause of the New York Constitution, among other claims.

He has heard from clients that they've "spent our lives, our fortunes building this place and now it is all about to be lost," he said. "So the actions we took have restored most of these businesses to operational viability."

The state filed a notice of appeal and an application for an emergency stay of Judge Walker's order Wednesday morning, according to Cohen.

Just as worrisome as the easing of current restrictions is the fear these lawsuits could keep health authorities from issuing restrictions during future emergencies, Piatt said.

Cases like Butler County's recent win don't just leave health officials "unsure exactly what they'll be able to do right now, but also in any emergency situation in the future, because you're setting a precedent with this decision that courts in future emergencies might look to," she said.

Whether or not such precedents get set may ultimately be up to the Supreme Court. The high court has already overturned restrictions on religious services in New York and California, but the justices have yet to weigh in on cases involving businesses' challenges to coronavirus measures.

"Businesses are far less likely to succeed than are religious institutions," Gostin said. "Freedom of religion is an explicit right under the Constitution, but economic freedom is not."

That could change with the Butler case, Piatt said, as any appeal of the Third Circuit's eventual decision may make it to the Supreme Court.

Other experts said the justices are unlikely to question public health actions in an emergency unless they infringe explicitly protected rights like the freedom of religion, assembly or speech.

But suits still to come could meet with more success, they said.

The next wave of COVID-19 litigation in California will likely concern reopening public schools since the education is a fundamental right under the California Constitution, Farella Braun's Wheeler said.

And lawsuits from state legislators alleging governors don't have the authority to issue some of their restrictions are also more likely to find sympathetic ears in court, Price said. Republican legislators have already successfully sued governors to invalidate COVID-19 orders in Wisconsin and Michigan.

Suits challenging eviction moratoriums are also a likely new front in the legal fight over health mandates, Price said.

New York landlords launched a suit in February alleging that the state's eviction ban tramples landlords' due process and free speech rights. A Texas federal judge has already ruled that the CDC can't enforce its nationwide eviction freeze because it lacks constitutional authority to regulate private property rights.

"If there is not more litigation about this, I'd be surprised," Price said.

However these suits turn out, courts are likely to see more of them, now and during future pandemics, Piatt said. As the pandemic and its restrictions stretch on, and as future health emergencies occur, people grow more inclined to challenge rules they see as harming their lives and livelihoods.

"A lot of what is behind these cases," she said, "is very human."

--Editing by Brian Baresch and Katherine Rautenberg.

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