Top 10 Things In-House Counsel Should Know About New COVID-19 Litigation
With a vaccine roll-out in progress and expected to increase in the coming weeks, most Americans can’t wait to return to normalcy, but the impacts of the COVID-19 pandemic are expected to stay with us for quite some time, and litigation is no exception.
In fact, corporate counsel would be wise to start preparing now for the changes in litigation that are likely to occur as a result, according to Crowell & Moring’s recent annual litigation forecast for in-house counsel.
“More and more, plaintiffs, and their lawyers, are viewing liability through the lens of COVID,” said Crowell counsel and litigation forecast contributor Chalana Damron, in a recent interview.
The top 10 things to know about COVID-related litigation changes anticipated in 2021:
1. Since jury trials aren’t likely to resume until a vaccine has been widely distributed, and backlogs are snowballing in the meantime, litigators can expect to see an increase in virtual depositions and court hearings, time limits on trials in an effort to expedite cases, and bench trials, which are easier to manage than jury trials.
2. Trial backlogs in 2021 could also encourage more companies, particularly those with tight budgets, to settle litigation earlier than they might have pre-pandemic.
3. The Paycheck Protection Program (PPP) will likely be the focus of increased litigation as banks face lawsuits from loan applicants who allege they were improperly denied PPP funding based on unlawful restrictions established by lenders, such as requiring applicants to have an existing account or borrowing relationship to receive funding.
4. Force majeure clauses, which remove liability for natural and unavoidable catastrophes that interrupt the expected course of events and prevent participants from fulfilling obligations, will also continue to be a major focus of litigation this year, as tenants assert that rent payments should be excused due to COVID-19 business restrictions implemented by individual states.
5. The rise in bankruptcy cases that began in 2020 is likely to also increase disputes as there will be more fraudulent transfer claims from adversarial proceedings in those bankruptcy cases as debtors claim the transfer was made without receiving a reasonably equivalent value in exchange.
6. On the employment front, COVID-related issues will also continue to make their way into the courthouses, with claims ranging from termination decisions, safety concerns, and failure to accommodate claims. Whether employers can or should be requiring vaccination and following the recently issued Equal Employment Opportunity Commission (EEOC) guidance on addressing the requests for disability-related and religious accommodations for those who won’t or can’t be vaccinated will be top of mind for employers.
7. Exposure-related suits are likely to increase as more plaintiffs accuse companies of failing to protect workers or customers from exposure to the coronavirus, such as failing to implement contact tracing, install physical barriers, or require employees to wear masks.
8. Products liability cases questioning the efficacy of masks, ventilators or hand sanitizers—products that some companies are manufacturing or distributing for the first time—can also be expected to surge.
9. Liability suits involving employees who have a reaction to COVID vaccines that were required by employers, and even those involving problems from the increased use of telemedicine devices.10. In-house counsel should start preparing now by thinking strategically and building a record documenting the COVID-related decisions made and the reasons they were implemented.
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