Client Alert: COVID-19 Class Action

COVID-19’s widespread health and economic crisis is tailor made for class action litigation.  We’re already seeing numerous class actions filed only two months after widely dispersed disease was first seen around the U.S.  Not only are class actions proliferating, but they include subjects which vary widely from the typical consumer and shareholder matters we typically see.
Coronavirus delivers what class actions thrive on – mass scale.  In four months, U.S. diagnoses have gone from zero to about one million, and deaths from zero to more than 45,000.  These tragic statistics in turn have motivated unprecedented economic dislocation, with mass unemployment but millions of Americans working every day in essential jobs with the risk of exposure.
These dreary facts are all too familiar, and some of us unfortunately have experienced them more intimately than others.  Enterprising attorneys have tried to harness this information to file class action suits, in novel ways that may affect you personally or in your business.
These are instances of COVID-19 inspired class actions so far:
  • Alleging liability for exposing others to coronavirus
  • Seeking refunds paid for services which can’t be delivered by shuttered businesses or schools
  • Alleging price gouging, antitrust, or fraud schemes on behalf of consumers
  • Asserting unsafe work conditions on behalf of employees
  • Seeking reimbursements for cancelled travel, entertainment, or sports
  • Recovering for false or misleading statements allegedly made to shareholders
  • Alleging breach of contract by insurers writing business interruption insurance
  • Claiming that banks have breached a statutory obligation to process emergency federal loan applications
  • Asserting data privacy violations
A great many businesses, to the extent they have experience with class action litigation at all, are familiar participating in one or two roles:  either as a passive consumer who learns of a class action lawsuit when a postcard arrives relating some small settlement or, more challengingly, in the gunsights as a defendant.  COVID-19 is likely to accelerate the rate at which companies find themselves in both of these roles.  But we anticipate that, with a proliferation of coronavirus class actions, we will see new and unusual challenges, as well.

We have started to see class actions – and expect to see more – that involve classes of businesses, not individuals, with valuable or even critical claims being asserted by strangers seeking no input whatsoever from the individual business class members.  A key concern for a class member in any class action is loss of control of the claim.  It will be critical for a business that is a putative class member to understand that it can actively assert and preserve its rights when someone tries to pursue litigation on its behalf.  And, it is essential that the business has legal counsel who is experienced in this complex area of the law.

With extensive experience in both bringing and defending class action cases, Whiteford, Taylor & Preston has earned a reputation over the course of eight decades as one of the leading trial law firms in the Mid-Atlantic, with a distinguished record of success pursuing and defending high stakes litigation.  Recognized by Chambers USA and Best Lawyers in America, among others, and named 2019 "Maryland Law Firm of the Year" by Benchmark Litigation, we provide sophisticated, cost-effective dispute resolution services to clients of every description.  With more than 90 litigators, including attorneys with financial, accounting and business backgrounds, we serve clients locally, regionally and nationally.
The information contained here is not intended to provide legal advice or opinion and should not be acted upon without consulting an attorney. Counsel should not be selected based on advertising materials, and we recommend that you conduct further investigation when seeking legal representation.