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California lawmakers debate granting businesses immunity

On Behalf of | Jun 11, 2020 | Denied Insurance Claims

As states ease pandemic restrictions and restart their economies, lawmakers debate the impending coronavirus lawsuits. Many of these civil suits accuse employers and businesses of negligence and stand to have a devastating impact on those industries.

In response, four states granted businesses immunity from COVID-19 claims, with several more extending immunity to health care providers and manufacturers. In California, lawmakers debate giving companies immunity through amendments to Article 17 of the Emergency Services Act.

A bipartisan push for immunity

Led by Senator Andreas Borgeas, a group of bipartisan legislators petitioned Governor Gavin Newsom to expand the Emergency Services Act. Newsom invoked the Act in early March 2020 in response to the coronavirus pandemic. These lawmakers look to immunity legislation in Oklahoma, Utah, North Carolina, and Wyoming for inspiration.

These measures would prevent employers or customers from suing businesses for neglect. Pro-immunity lawmakers believe that no business could have reasonably responded to the coronavirus. The legislators also argue that the mere threat of these lawsuits may be enough to sink small businesses.

Lawmakers further argue that the industries most affected by coronavirus — meatpacking, senior care, and travel — would not survive the sheer number of lawsuits, much less be able to pay all damages. The lawsuits threaten the insurance industry as well.

The American Tort Reform Association (ATRA) supports immunity. The group claims that personal injury attorneys are recruiting people to file lawsuits now, even if they have not contracted the disease. If legislators do not retroactively apply immunity, many suits may still get through.

Among the businesses considered for immunity are nursing homes. As of June 11, over 2,000 nursing home patients in California have died since the onset of the pandemic. Immunity legislation would leave these victims’ families no legal recourse in seeking restitution for their deaths.

Bring questions to a local lawyer

Whichever way California rules, attorneys will likely test the courts on the extent of the immunity for years. Individuals who believe they have unjustly denied coverage for a claim involving the pandemic can reach out to a local attorney familiar with insurance law.