On August 12 Tennessee became the most recent state to pass a law providing businesses with liability protection relating to COVID-19 claims. At least 12 other states—including Alabama, Arkansas, Georgia, Iowa, Kansas, Louisiana, Mississippi, North Carolina, Ohio, Oklahoma, Utah, and Wyoming—have enacted or started enacting legislation to narrow the liability limits related to and stemming from COVID-19.
Under the legislation, a covered entity will not be liable for any damages, injury, or death that results from a health emergency claim if the covered entity did not act with gross negligence or willful misconduct and substantially complied with applicable public health guidance. The Tennessee General Assembly was very careful to provide protections for patrons and employees against gross negligence or willful misconduct.
Over the last few months, Tennessee’s businesses have worked through a phased reopening, and have been encouraged to sign on to the Tennessee Pledge, a plan to help Tennesseans to return to work in a safe environment, restore their livelihoods and reboot the state’s economy. Even with the efforts being taken to return to work in a safe environment, many businesses, especially smaller businesses, are worried about coronavirus-related lawsuits.
For those businesses who are following Metro Nashville and/or CDC guidelines, it appears that the new law is designed to protect them from frivolous lawsuits. However, businesses that throw caution to the wind and refuse to follow even the most simple guidelines may be leaving themselves open to a claim of willful misconduct or gross negligence.
One of the most significant areas of debate surrounded making the law retroactive to early March. Under the final version, the law applies to “new” claims that arise after August 3, 2020. If proper notice of a claim was given or litigation was filed on or before August 3, those matters may proceed.
Since June, a broad coalition of business, education, manufacturing, trade associations, nonprofits, and healthcare representatives have worked to develop a solution to protect responsible businesses that are vital to Tennessee’s economy from frivolous lawsuits. The legislation is intended to protect these businesses against unfair legal exposure and to ensure that businesses have certainty that their efforts to safeguard their employees and customers will be acknowledged by the courts. Providing these businesses with liability protections is an important step to support reopening. The new law is titled the Tennessee COVID-19 Recovery Act (SB 8002/HB 8001) and will go into effect upon signature from the Governor.