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How to Measure the Threat of Liability Lawsuits

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How many lawsuits have been filed over alleged COVID-19 exposure at businesses? That’s not the real question, say the NAM’s legal experts. The real question is: how many will be filed over the next three to five years?

A recent legal analysis shows that only 5% of lawsuits filed since March fall into the category of COVID-19 liability—but don’t be misled by that, says NAM Vice President of Legal and Deputy General Counsel Patrick Hedren.

Here are some pertinent facts to keep in mind:

  • The vast majority of states have a two- or four-year statute of limitations period for bringing tort lawsuits.
  • No state has a limitation of less than one year, and some allow lawsuits after four or even six years. Which means . . .
  • The flood of COVID-19-exposure litigation isn’t expected until spring 2022 when these claims start to expire.

In other words, focusing on today’s numbers obscures a coming wave that could overwhelm businesses at a time when they can least afford it.

And here’s the case for targeted liability protections, says Hedren:

  • Business leaders have been doing the best they can with the information they have in an evolving situation.
  • Guidelines from the early days of the pandemic have been refined, rewritten and sometimes replaced.
  • In many cases, local, state and federal guidelines have all conflicted with one another, creating a no-win situation for businesses that could face trouble no matter what they do.

The solution: Legislation offered by Senate Republicans—and vigorously pursued by the NAM—actually gives teeth to evolving safety measures by shielding businesses from liability if they make reasonable efforts to follow public health guidelines. (In many ways, it seems that Senate Majority Leader Mitch McConnell (R-KY) is reading from the NAM’s liability playbook.) If businesses engage in “gross negligence or willful misconduct that caused an actual exposure to coronavirus,” they remain open to lawsuits.

The last word: “The way to deal with safety is through thoughtful guidance that can stay fresh as the science evolves—not through a mess of court cases in thousands of jurisdictions across the country,” said Hedren. “Businesses across the country need commonsense liability protections that depend on adherence to safety standards, promote certainty and strengthen their ability to serve their community and the country.”

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