Essay: Unless governor and lawmakers pass protections, abusive COVID-19 lawsuits could wipe out small firms

By Travis Hausauer

If the economic consequences of the COVID-19 pandemic don’t destroy many businesses and jobs in California, the coming avalanche of abusive lawsuits certainly will.

We need help from Gov. Gavin Newsom.

When COVID-19 first struck, essential businesses immediately responded. Many business owners answered the call to remain open, supplying food, groceries, hardware supplies, medicine, gas and other products and services so our fellow Californians could remain safer at home.

The business community bought face masks and shields, installed Plexiglass, disinfected and socially distanced. We took our employee’s temperatures when they arrived for work, we limited the number of customers in our stores, we distanced our employee work stations and we fought hard to keep our store shelves stocked. We did the right thing and acted in good faith.

For a time, it looked like Assembly Bill 1035—a bipartisan measure to provide basic legal protections to businesses during the pandemic—would make it to the governor’s desk. It passed through the Assembly unopposed on May 9, but the bill is stuck in the Senate Judiciary Committee. And the Legislature is scheduled to adjourn on Aug. 31.

Business owners, who are risking their lives to stay open and provide essential services, are asking for the governor’s help. We need to know that a business we created, investing all the money and energy to make it work, will remain solvent and that an abusive suit won’t wipe us out.

Imagine getting served with a lawsuit from a customer who fears contracting COVID-19. The customer is not claiming they actually were infected, but they sue anyway. It has already happened, though fortunately a judge recently threw out the claim against a cruise ship operator. The judge said allowing passengers to collect damages based on potential COVID-19 exposure, without suffering any symptoms, raised concerns of unlimited liability for restaurants, bars and other places where people gather.

We need Newsom to call on legislators to send a bill that grants legal protections to essential businesses. This is a time for lawmakers to work together, in partnership to enact real protections for us.

Business owners, who are risking their lives to stay open and provide essential services, are asking for the governor’s help.

Under the Emergency Services Act, the state already protects a small group of private entities that help during a crisis from civil liability, except in cases of gross negligence or willful misconduct. All essential businesses deserve this same protection.

There are also other businesses that need protection from abusive litigation—those that took the initiative and retooled their manufacturing or assembly processes to create masks, disinfectants and gowns to protect Californians.

If the governor doesn’t help us, then we can only count the days until the threat of unwarranted lawsuits becomes a reality. Our state is already well known for its plaintiff-friendly court system that puts businesses at greater risk of lawsuit abuse.

Unwarranted lawsuits stemming from COVID-19 will wipe us out. And the hope of sustaining our livelihoods during and after this pandemic will be buried forever.