It's been 40 days since Gov. Gavin Newsom proclaimed on March 4, 2020 a state of emergency due to COVID-19.
And as residents adjust to the governor's subsequent stay-at-home orders issued on March 19, 2020, attorneys have had the time to reflect on the litigation landscape.
Below are three areas of law they foresee to be a spike due to the COVID-19 outbreak.
COVID-19 personal injury: Contingency lawyers earn money when people are personally injured but because the COVID-19 outbreak has everyone staying at home due to the governor's orders, injuries are less likely to happen, which impacts their income, according to Mike Arias, immediate past-president of the Consumer Attorneys of California.
“When jury trials are on hold, it means jury awards are on hold in contingency cases,” Arias told the Southern California Record. “A lack of jury trials leads to a delay in injured people receiving compensation for their injuries and there are thousands of cases pending without a resolution due to court closures from the threat of COVID-19.”
When a state of normalcy returns, Arias fears lawyers will take advantage of COVID-19 personal injury claims
“We work on contingency and don’t get paid until the end of the case,” he said. “It is a huge economic strain when we cannot speedily resolve our cases.”
When courthouses do re-open to the public, Arias believes people will continue to have concerns about being in crowded spaces and predicts jurors who have been subpoenaed to appear in a trial may seek to avoid their duty out of fear of COVID-19 exposure.
“We have to develop new ways to conduct a jury trial without jurors sitting within 6 feet of each other in a jury box,” he said.
Wrongful termination of employment. Due to efforts by the governor to reduce the spread of COVID-19 with stay-at-home and shelter-in-place orders, businesses facing COVID-19-related business circumstances have been closing so rapidly that labor codes requiring advance notice for layoffs were suspended on March 4 based on the governor's Executive Order N-31-20.
Existing law remains, however, which require layoffs or terminations to be conducted in a non-discriminatory way, according to the state’s Department of Fair Employment and Housing (DFEH).
“To the extent people believe they have been terminated in a discriminatory way, DFEH has jurisdiction to investigate, and they should file a complaint on our website,” said Kevin Kish, director of DFEH. “We are expediting complaints alleging discrimination related to the COVID-19 crisis.”
Wrongful termination will be a very active area for the foreseeable future, according to William B. Gould IV, an attorney, professor of law at Stanford Law School and author of the book A Primer on American Labor Law (6th edition. 2019).
"Public policy favors the fair treatment of workers who are afflicted with this virus,” Gould told the Southern California Record. “It can be characterized as a disability so that there may be actions that can be brought on a public policy exception, violation of the Americans with Disabilities Act or state laws on disability.”
Denial of business interruption insurance coverage. Although a business interruption insurance policy reimburses for lost profits, payment of wages to their employees and payment of bills while the business is inoperable, Brian Kabateck, an attorney with KBK Lawyers in Los Angeles, is finding that many of his clients are being told by their insurance brokers that the COVID-19 outbreak is not covered. As a result, he foresees a high number of lawsuits will be filed to recover damages from insurers.
Most business interruption policies are all-risk, which means everything is insured except what is excluded.
“It’s the insurance company’s burden to prove that an exclusion applies and that a virus exclusion is clearly stated, Kabateck told the Southern California Record.
Although an estimated 60% to 70% of all policies have a virus exclusion, Kabateck says the clause is often vague.
“Many businesses are closed because the government issued an order to shut down not because any employees have tested positive for the virus and there is coverage in these policies for government closure,” Kabateck said.