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Legislation would protect businesses from COVID-19 claims

May 18, 2020

With pandemic-related legal filings on the rise across the country, the Waller Government Relations team has worked closely with the Tennessee Chamber of Commerce and Industry to draft the Tennessee Business Recovery and Safe Harbor Act. This crucial legislation is designed to provide broad civil liability protection from “health emergency claims” for a wide array of covered entities in Tennessee, including many businesses, healthcare providers, educational entities, governmental entities, cultural institutions and churches.

The Waller team is currently engaging with various stakeholders and members of the General Assembly to prepare a vehicle and strategy for passage of the bill when the legislature reconvenes on June 1. While this legislation remains subject to revision throughout the legislative process, the Waller Government Relations team will be working diligently to enact critical liability protections for covered entities as Tennessee moves forward in the wake of COVID-19 restrictions. If you have any questions regarding the Tennessee Business Recovery and Safe Harbor Act, please contact Nicole Watson or James Weaver.

Covered Entity Protection

Under the Tennessee Business Recovery and Safe Harbor Act, a covered entity would not be liable for damages, injury, court costs, subrogation or death suffered or claimed by any person or entity as a result of, or in connection with, a health emergency claim related to the Coronavirus that results from any act or omission of the covered entity attempting to follow or respond to applicable public health guidance.

The Act defines a “health emergency claim” to include any cause of action that is related to the following circumstances:

  • The actual, alleged, or feared exposure to or contraction of coronavirus from the premises of a covered entity or otherwise related to or arising from its operations, products, or services provided on or off-premises;
  • The covered entity’s efforts to prevent or delay the spread of coronavirus including, but not limited to, any of the following:
    • Testing;
    • Monitoring, collecting, reporting, tracking, tracing, disclosing or investigating exposures or other information;
    • Using, supplying or servicing precautionary, diagnostic, collection or medical-related equipment, or supplies such as personal protective equipment (PPE); and
    • Altering or discontinuing activities or services.

Burden of Proof

In order to overcome the liability protection afforded by this legislation, a plaintiff would need to demonstrate the following:

  • The standards and/or restrictions in effect when the claims arose and related to the covered entity’s business or operations under applicable public health guidance and direction, and
  • The specific conduct of the covered entity that constitutes gross negligence or willful misconduct relating to such standards and/or restrictions.

In the instance a plaintiff meets this burden of proof, and the acts or omissions do not result in serious physical injury, a covered entity’s liability would be limited to actual economic compensatory damages and in no event would the covered entity be liable for non-economic or punitive damages.

As employers grapple with interpreting the onslaught of federal, state, and local public health guidance issued in response to the coronavirus, many entities have expressed growing concern regarding the threat of frivolous litigation filed in response to safety guidelines implemented for employees and patrons during these unprecedented circumstances. In order to alleviate these concerns, this legislation adopts a comprehensive definition of “applicable public health guidance,” which includes all forms of governmental guidance and direction released throughout the progression of the pandemic.

  • Plaintiffs will have the burden of proving, by clear and convincing evidence, that a covered entity demonstrated gross negligence or willful misconduct in implementing the applicable health guidance ineffect at the time the claim arose.
  • While this burden of proof remains high relative to other standards, a covered entity will still need to demonstrate good faith compliance with public health guidelines applicable to their respective venue at the time of the alleged conduct.

The Tennessee Business Recovery and Safe Harbor Act offers protection from all health emergency claims accrued on or after the date of the first confirmed Coronavirus case reported by Tennessee Department of Health on March 5, 2020.

Healthcare Provider Protections

In addition, this legislation provides vital protection from health emergency claims for Tennessee healthcare providers, including:

  • Absent gross negligence or willful misconduct, a healthcare provider that renders treatment to a COVID-19 patient in good faith will be not liable for any damages, personal injury or death alleged to have been caused by an act or omission of the provider during the delivery of care performed in compliance with guidance and direction issued in response to the Coronavirus.
  • If a plaintiff succeeds in establishing gross negligence or willful misconduct in relation to applicable health guidelines, and the acts or omissions do not result in serious physical injury or death, a healthcare provider’s liability will be limited to actual economic compensatory damages, and in no event will the healthcare provider be liable for non-economic or punitive damages.

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