Class action suits alleging companies failed to protect workers from COVID-19 have become a new business model for some attorneys, and aren’t helping California’s economic recovery, a trade association leader says.
“Any time you start down this road with class action lawsuits, it makes money for the plaintiff’s attorneys, not the plaintiffs, and it increases the cost of doing business in California,” Rachel Michelin, president of the California Retailers Association, told the Northern California Record.
Particularly as the Legislature confronts a $54 billion deficit and cuts to services, including the court system, such litigation needs some parameters, Michelin said.
“We had hoped for liability protections,” Michelin said. “We, along with other business associations, asked the governor back in April for help with an executive order or legislation on liability protection, particularly pertaining to COVID, because we don’t know how COVID spreads; first we’re told it’s by touching surfaces, and now it’s everybody needs to wear masks, and the reality is we don’t know.
“So how, if your attorney goes in to a store or restaurant, how do they prove that [a worker] got it there?” Michelin said.
The economic downturn caused by the evolving health pandemic won’t be solved through expensive litigation, Michelin added.
“The driver for the California economy is business; if the Legislature wants a surplus, they need revenue and a huge portion is sales tax,” Michelin said.
“To recover out of this, we need to do so collaboratively with our governor, elected leaders, and businesses, and without the continued threat of litigation from these types of lawsuits.”
Dozens of COVID-related class actions against businesses remain in the court system. A recent case against Lowe’s was dismissed a week after the company’s attorneys filed to remove it from state court to federal court. Yet without liability protections, a wave of similar litigation is expected in the coming months.
“It’s unfortunate that certain attorneys and law firms are taking advantage of folks, and putting in jeopardy our fragile economic recovery,” Michelin said. “To start opening class actions to see how many other people want to jump in, how is that going to help us recover?” Michelin said.