By Matthew Santoni

Law360 (March 10, 2021, 4:04 PM EST) -- Pennsylvania's 2020 docket related to the COVID-19 pandemic was a series of flashpoints that reflected the tensions throughout the nation as the courts dealt with emergency shutdown orders, mask mandates and the limits of state power to enforce them.

In the past 12 months, the courts have generally upheld the state's ability to shut down businesses and the state and businesses' ability to require masks. But businesses have been stymied when seeking a definitive answer to whether their insurance should cover losses and extra costs due to the pandemic.

Courts and litigants recognized the danger of the pandemic at first, when the response was still relatively free from politicization. But over time, Republicans in the state legislature and the Democratic-led executive branch began contending over the state's efforts, with the General Assembly introducing legislation and resolutions to undo the governor's actions, said professor Bruce Ledewitz of Duquesne University School of Law.

"Nobody was fooling around in April — it was a very, very dangerous time and everybody knew it," Ledewitz said. "Everybody was extremely worried about the pandemic; it was only later that the courts would gingerly start examining these issues."

Here are a few of the significant Pennsylvania cases the pandemic has produced over the last year.

Friends of Danny DeVito v. Wolf

Early in the pandemic, the state Supreme Court upheld Gov. Tom Wolf's orders closing non-essential businesses, and ruled that the state emergency code gave the executive branch broad powers to try and contain the spread of the virus.

Republican political candidate Danny DeVito, who is not the Hollywood actor, had joined two businesses to sue the governor over his initial shutdown orders, arguing the state's emergency code did not cover pandemics and the governor's orders violated their constitutional rights.

In a 4-3 ruling, the Pennsylvania justices said the pandemic was the kind of emergency that fell under the code's "other catastrophe" catchall. A process for "non-life-sustaining" businesses to seek exemptions from the closure order satisfied the Constitution's due process requirements, the court said.

Meanwhile, the state's revisions to the shutdown orders and its light touch on enforcement helped avoid more substantial challenges, Ledewitz said. Religious institutions were not forced to close, and a revision to the orders allowed gun shops to stay open, ducking thorny First and Second Amendment issues that could have scuttled the orders, he said.

"Governor Wolf stayed one step ahead. ... There never really was a way to really challenge the orders," Ledewitz said. "It was almost like during the Vietnam War, where you could not get a court to say whether the war was legal or not."

Joseph Tambellini v. Erie Insurance Exchange

Many businesses filed suits seeking insurance coverage for their losses related to the pandemic. In this case involving Pittsburgh restaurant Joseph Tambellini and Erie Insurance Exchange, the court tried but failed to establish whether pandemic-related business losses are considered a "physical loss" that would be covered by most insurance policies.

"Physical loss or damage is the one common issue in every case, no matter what," Scott Cooper of Schmidt Kramer, one of the attorneys for Joseph Tambellini Inc. and a number of other businesses seeking coverage, told Law360 Tuesday.

After initially filing in the Allegheny County Court of Common Pleas in April, the restaurant asked the Supreme Court of Pennsylvania to take up the case using its "King's Bench" power and decide the threshold issue of whether the pandemic or the associated government closure orders created a physical loss.

But the high court declined in May as insurers argued that each business's case and contract was too individualized for a sweeping, statewide ruling.

Tambellini was then one of the cases against Erie Insurance grouped together in Allegheny County, hoping for a consolidated pretrial ruling on the definition of a physical loss, but Erie put the cases on hold with an appeal to the Superior Court.

Without a ruling from the top court or broad precedents to point to, federal courts in Pennsylvania have since offered piecemeal and sometimes contradictory rulings on whether insurers owe coverage for coronavirus closures, with some judges saying the virus didn't create physical damage while others said they wanted to see more rulings from the state courts on interpreting coverage under state law.

County of Butler v. Wolf

In the first ruling in Pennsylvania to restrict the state's power in response to the pandemic, U.S. District Judge William S. Stickman struck down parts of the orders in September and said the governor lacked the power to impose such sweeping limitations in the first place.

"The solution to a national crisis can never be permitted to supersede the commitment to individual liberty," Judge Stickman wrote.

The state appealed to the Third Circuit, which stayed the ruling for now, and the case remains pending. When a ruling comes, it could not only set limits on emergency powers, it could set a precedent for whether federal courts can second-guess state executives' emergency orders, said University of Pittsburgh School of Law professor Gerald Dickinson.

"Judge Stickman's decision ... in many ways reversed course on long-standing precedent," Dickinson told Law360. "The court was substituting its own judgment for the judgment of elected officials."

The state argued in its appeal brief that the judge had relied on an outdated and largely abandoned U.S. Supreme Court case supporting "economic liberty," Lochner v. New York , that had been replaced by a ruling in Jacobson v. Massachusetts establishing that states could place some limits on absolute liberty in the name of public health.

Dickinson said that even before the Third Circuit rules, the Butler decision could give some officials pause as they cope with the ongoing pandemic.

"No doubt the state of Pennsylvania and elected officials are on notice that there are some federal judges ... who are going to closely scrutinize these policies and their effects on business," he said.

Pletcher v. Giant Eagle

This consolidated suit has, so far, upheld Pennsylvania retailers' ability to enforce mask policies, though the plaintiff is still seeking a declaration that such policies violate the Americans with Disabilities Act. Giant Eagle has since been joined by other retailers around the country enacting mandatory mask policies.

When Giant Eagle set and enforced a no-exceptions mandatory face covering policy for its shoppers during the pandemic, a customer sought an injunction barring the grocer from enforcing the policy on the grounds that it didn't provide "individual assessments" of safety and potential accommodations as required by the ADA. Giant Eagle argued it didn't have to make accommodations that posed a threat of exposing its staff and customers to the virus if those unable to wear a mask were merely inconvenienced.

But U.S. District Judge Nora Berry Fischer twice said that Josiah Kostek, the customer seeking the injunction, hadn't adequately shown that his anxiety and breathing issues were enough to keep him from wearing a mask, or that he couldn't take advantage of curbside pickup, grocery delivery services or a less binding alternative to cloth or paper masks, like a clear plastic face shield.

The case is still pending, with a third amended complaint filed in November and Judge Fischer setting discovery deadlines throughout March for Giant Eagle's policies, the customers' medical records and their electronic communications regarding masks.

The Crack'd Egg v. Allegheny County

A vehemently anti-mask restaurant outside Pittsburgh challenged the legality of the statewide mask order and the Allegheny County Health Department's power to enforce it, but a state court judge upheld the mask requirement.

Duquesne's Ledewitz said The Crack'd Egg was one of the few businesses that had drawn the attention of enforcement agencies — in this case, the county health department — and therefore might be able to point to some damages if it won its case. But he said he didn't expect the appellate courts to overturn the mask order.

"You pretty much had to hold a press conference to say, 'We're violating the order' before the state stepped in," he said. "Unless the courts are going to become epidemiologists ... I don't know how they're going to counter the government's arguments that they need these orders."

Allegheny County sued The Crack'd Egg and its parent company, The Cracked Egg LLC, in state court in September to enforce the mask requirements. The restaurant filed for Chapter 11 bankruptcy to stay the suit and remain open without masks, but after the bankruptcy judge lifted the stay, The Crack'd Egg argued the mask orders were improper because they had not gone through the state legislature or the typical regulatory approval process.

But Allegheny County Court of Common Pleas Judge John McVay ruled Feb. 3 that the mask orders were supported by the state's interest in limiting the spread of the pandemic. The usual lengthy regulatory approval process did not apply in an emergency, the judge said, and he rejected the Butler County ruling, saying Jacobson v. Massachusetts still applied.

Faced with an order to either follow the mask orders or shut down, The Crack'd Egg shut down pending an appeal to the Commonwealth Court of Pennsylvania.

--Editing by Brian Baresch.

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