COVID-19 Litigation Continues To Be Filed by Consumers and Employees

Since the start of the pandemic, Audit Analytics has identified over 120 instances of COVID-19 litigation. These include lawsuits that are filed directly referencing circumstances that would not otherwise exist outside of the coronavirus pandemic. There are a wide array of issues, from consumer complaints, to insurance claim denials, to regulatory actions.

Many of the plaintiffs in these lawsuits are consumers and employees filing actions against specific companies for alleged COVID-19 related misconduct. This post focuses on lawsuits filed after our first update on COVID-19 related litigation in April 2020.

Consumers & COVID-19 Litigation

Consumers have filed lawsuits against a variety of companies, alleging failure to provide contracted services, personal injury, fraudulent advertising, and violations of rights stemming from modified business practices related to the pandemic.

Failure to Provide Services

As was noted in our first update on COVID-19 related litigation, there have been several lawsuits brought by consumers against companies that failed to provide a service as a result of the pandemic. In May, consumers brought a class action lawsuit against British Airways, alleging that the airline failed to issue refunds for tickets for flights that were canceled at the onset of the pandemic.

Personal Injury

Travel cruise companies Carnival Corporation [NYSE: CCL] and Princess Cruise Lines have both been sued by consumers related to personal injury complaints, ranging from damages from emotional distress associated with contracting the illness to wrongful death lawsuits.

One complaint alleges that one-fifth of the passengers on board one of Carnival’s cruises became ill during an outbreak of the virus while on the cruise. The plaintiffs claim that Carnival was aware of COVID-19 positive passengers on its cruise ship, but nevertheless encouraged guests to mingle to “keep the fun going.” Carnival is also facing lawsuits from the estates of former passengers who passed away after contracting COVID-19 on one of their cruises.

Advertising and Pricing

Some consumers have been vocal opponents of perceived fraudulent advertising practices and price gouging.

Both Alphabet [Nasdaq: GOOGL] and CVS Health [NYSE: CVS] have been sued by plaintiffs alleging that those companies touted hand sanitizer and cleaning products as capable of killing “99.9% of germs” in advertisements, despite a lack of evidence supporting that notion, thus allowing the companies to profit off of the false claims.

EBAY [Nasdaq: EBAY] and Cal-Maine Foods [Nasdaq: CALM] have both been accused of price gouging consumers for products necessary during the pandemic. EBAY allegedly allowed prices to inflate 300% for items such as N95 masks, disinfectants, and other in-demand goods and Cal-Maine was named in a suit alleging exorbitant pricing for eggs during a state of emergency.

Modified Business Practices

Walmart [NYSE: WMT] was hit with consumer litigation related to violations of the Americans with Disability Act while attempting to increase accessibility and safety in their stores. Like many retailers, Walmart designated certain shopping hours for the elderly and those with compromised immune systems in an effort to provide a safer experience for those individuals. However, consumers allege that Walmart’s execution of the plan was flawed, claiming that the Company utilized subjective and discriminatory practices to determine who was actually eligible to shop in the established window.

COVID-19 litigation filed by consumers
click to expand

Employees & COVID-19 Litigation

Employees are also likely to bring COVID-19 related lawsuits for personal injury, forced leaves or termination, and compensation issues.

Personal Injury

Similar to an April class action suit against Smithfield Farms, employees for Amazon [Nasdaq: AMZN], SafeWay, and Tyson Foods have brought lawsuits claiming unsafe working conditions and a failure to follow federal and state guidelines during the pandemic. At Safeway, an employee contracted COVID-19 during working hours and subsequently passed away.

Labor Relations

Some employees that lost employment in the course of the pandemic are seeking damages against their employers for unlawful termination. The Hertz Corporation is being sued in a class action complaint by plaintiffs alleging that Hertz terminated its employees without advance written notice in violation of the Worker Adjustment and Retraining Notification Act. Global law firm Shearman and Sterling is also being sued by a former employee, alleging that he was terminated due to his age and to disguise COVID-19 related layoffs.

United Airlines is being sued by employees who claim that the airline forced their employees to take an unpaid leave of absence, despite the airline receiving $5 billion in federal paycheck protection under the CARES Act; the employees allege that they were the intended beneficiaries of the money received in connection with the payroll protection program (PPP).

Aside from the PPP, the pandemic has prompted litigation stemming from exposed cracks in the labor system related to compensation, sick time, and unemployment benefits.

Sherwin Williams has faced employee lawsuits related to a failure to fairly compensate employees for overtime hours worked during the pandemic. In a similar vein, Lyft employees filed a lawsuit alleging that they are entitled to paid sick time under the D.C. Accrued Safe and Sick Leave Act, as the employees argue that paid sick time is essential during the pandemic crisis.

In terms of unemployment benefits, in Islam v. Cuomo, plaintiffs are challenging New York State Department of Labor’s (DOL) failure to provide unemployment benefits to drivers for Uber, Lyft, and other For-Hire Vehicle service employers in a timely manner like the DOL does for employees of other companies.

COVID-19 litigation filed by employees
click to expand

While consumers and employees are among some of the top plaintiffs in COVID-19 related lawsuits to this point, Audit Analytics has identified numerous other categories of litigation that will be discussed in a following post, including:

  • Regulatory actions and securities fraud;
  • Corporations suing insurance companies for denied claims;
  • Entities suing corporations for breaches of contract; and
  • Various instances of fraud.

This analysis uses data from the Litigation database, powered by Audit Analytics.

For more information about Audit Analytics or this analysis, please contact us.

Interested in our content? Be sure to subscribe to receive our email notifications.