As Oklahoma and other states begin to reopen slowly, attorneys say businesses will likely face liability lawsuits related to COVID-19. Journal Record editor Russell Ray discusses how litigation costs could devastate small businesses.
Full transcript:
Drew Hutchinson: This is the Business Intelligence Report, a weekly conversation about business news in Oklahoma. I’m Drew Hutchinson. Joining me by phone again this week is Russell Ray, editor of Oklahoma City’s own The Journal Record. Thank you for being here, Russell. How are you doing?
Russell Ray: We’re doing good, Drew. Thanks for asking.
Hutchinson: This week, we’re discussing an interesting story from Journal Record reporter Chip Minty. He wrote that as some businesses start to reopen, we could see a surge in lawsuits claiming people contracted COVID-19 at certain establishments. The pandemic has already gutted business revenues across the state and the nation, but costs from potential lawsuits could damage businesses even more.
Ray: Well that’s right. Oklahoma businesses could face lawsuits filed by customers and employees claiming they contracted COVID-19 while in their restaurants, bars and other businesses, forcing court cases that could cost tens of thousands of dollars in legal fees for businesses. It’s another unfortunate byproduct of this pandemic that has seen more than 60,000 U.S. fatalities and millions of people out of work. Some say the legal fallout could continue long after the disease is a distant memory.
Hutchinson: That’s right. However,an attorney with Oklahoma City law firm Phillips Murrah told The Journal Record that COVID-19 tort claims against businesses are not likely to be successful. This is because plaintiffs would have to prove without a doubt that they contracted the virus from a specific business or from a specific person. For businesses that are adhering to safety guidelines, an unfavorable judgment isn’t necessarily the biggest economic risk here. The main concern is how a business would pay up to $50,000 in legal fees while trying to defend themselves in a liability case.
Ray: Well that’s right. These cases would be very difficult to prove. The big thing for businesses is the cost of litigation. Some business owners say this kind of scenario is what liability insurance is for. But attorneys say that may not be true in the case of COVID-19. One attorney told us insurance companies are already denying business interruption claims associated with COVID-19. They’re likely to turn their backs on COVID-19-related tort liability claims as well. And it won’t be long before the first lawsuits start rolling in. Plaintiffs’ attorneys are well-funded, and they have plenty of opportunity to file tort claims.
Hutchinson: Right. As you mentioned, without a guarantee that insurance companies will back them, businesses may have to place their hope in liability legislation that could be passed at the federal and/or the state level. In fact, the Oklahoma Retail Merchants Association is backing two proposals now pending in Congress. Both measures would protect businesses from liability when they follow the government’s COVID-19 safety guidance.
Ray: That's right. There’s a lot of talk about providing legal protection for businesses. In addition to federal legislation, the State Chamber is working with Oklahoma legislators to protect businesses that are observing government guidelines. No proposals have been filed yet, but the chamber’s VP of public affairs said talks are underway. State Chamber Vice President of Public Affairs Kinsey Westwood said the goal is not to protect the bad actors. She said most businesses are indeed doing their best to comply with the guidelines and keep their customers and employees safe and healthy.
Hutchinson: Russell, I want to thank you for your time today.
Russell Ray: My pleasure, Drew. Thank you.
Hutchinson: Russell Ray is editor of The Journal Record. KGOU and The Journal Record collaborate each week on the Business Intelligence Report. You can follow us both on social media. We're on Facebook, Instagram and Twitter: @journalrecord and @KGOUnews. The story we discussed today is available on JournalRecord.com. And this conversation, along with previous episodes of the Business Intelligence Report, are available on our website, KGOU.org. And while you’re there, you can check out other features and podcasts produced by KGOU and our StateImpact reporters. For KGOU and the Business Intelligence Report, I'm Drew Hutchinson.
The Business Intelligence Report is a collaborative news project between KGOU and The Journal Record.
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