Your business might already be struggling to survive due to quarantines and non-essential business shutdowns. More difficulties may be on the horizon, however, as consumers and other parties may consider filing suit for losses or injuries related to COVID-19. At Purdy & Bailey, LLP, we strongly urge you to prepare your business for potential pandemic-related litigation. Part of that preparation process can involve staying up to date on current lawsuits so you can avoid similar issues with your own company.
The following is a brief overview of COVID-19-related issues that have led to business litigation for many U.S. companies.
Businesses that charge monthly dues and membership fees need to take great care during the COVID-19 shutdown. Youfit Health Clubs and Vail Resorts are two examples of businesses that have faced class-action lawsuits because they continued to charge customers while their facilities were closed.
Concerts and other public events have been canceled because of local- and state-ordered quarantines. Ticketmaster and Live Nation have both been hit with class-action lawsuits because they allegedly changed their refund policy to avoid refunding customers for canceled concerts.
Many businesses are capitalizing on the sudden need for preventative products, such as masks, cleaning products, and hand sanitizer. Target, Purell, and Germ-X have faced class-action lawsuits because they allegedly claimed their hand sanitizers could prevent viral diseases, such as the flu. The pandemic shined a light on these products and, subsequently, the severe lack of studies proving their effectiveness.
Failure to Protect Employees or Consumers from the Virus
Businesses are under exorbitant amounts of pressure to respond perfectly to COVID-19. Although governments on local, state, and federal levels have issued highly inconsistent and contradictory guidelines since the beginning of the pandemic, both employees and consumers expect companies to warn them of risk factors, minimize and even eliminate exposure potential, screen all workers, and provide equipment and other accommodations so everyone involved can partake in “business as usual.”
Unfortunately, this is easier said than done, and many businesses are facing lawsuits as a result of mistakes or unforeseeable complications. Walmart and several cruise lines, for example, have been hit with lawsuits because of the above issues.
Failure to Fulfill Contractual Duties
Many business contracts have force majeure clauses, which protect parties from liability when an unforeseen and unavoidable event prevents them from fulfilling their contractual obligations. But every force majeure clause is different, and some businesses may be found in breach of contract if they modify their operations in response to COVID-19 or related shutdowns.
Let Our Team Guide You Through This Crisis
At Purdy & Bailey, LLP, we want to help you protect your business from liability for events you cannot control. We can evaluate your contracts and operations to determine whether you are safe from litigation. If you find yourself facing a lawsuit, we can take your case to court and fiercely defend your business from substantial loss and a tarnished reputation. In the meantime, we highly recommend staying on top of local, state, and federal guidelines—this diligence can help you avoid conflict with both customers and employees.