Survey Says—Here Come More Class Action Lawsuits

The results of the ninth annual Carlton Fields Class Action Survey confirms the recent forecast that businesses should be prepared for a sharp uptick in class action lawsuits. Even pre-pandemic, there was an upward trend in class action litigation. The survey published in late July confirms that there have been an astounding number of COVID-19-related class action lawsuits in the past few months, with more than 500 new putative class actions filed since early spring.  

The bulk of the recent class action filings involve disputes over insurance claims (e.g., business interruption coverage disputes) and lawsuits brought by students seeking reimbursement of tuition and fees. Several notable recent cases are described below.

Two limited liability companies responsible for managing a pair of San Francisco restaurants recently filed a putative class action suit against their insurers, seeking declaratory relief in the form of an order requiring said insurers to provide coverage for business interruption expenses attributable to the COVID-19 pandemic. Similarly, two companies responsible for operating a local barbershop and barber academy in Virginia Beach filed a class action lawsuit against their insurer, asserting a more complex set of claims for breach of contract and declaratory relief corresponding to four particular coverages. The defendant insurance companies in both lawsuits have yet to file their responses to these complaints, but there are already hundreds of business-interruption-related class actions that have been filed in recent months—with many more filings likely to follow.

As these class action claims play out in courts across the country, companies and educational institutions will be able to distill and implement important “lessons learned,” including how to avoid or minimize the risk of class action liability. Regardless of the industry, companies can implement proactive measures to fortify their operations and protect against future exposure stemming from the pandemic. 

Where there are people and companies—and money — there will be disputes. When those nasty things threaten YOU and YOUR business including landlord/tenant matters, contract issues, nuisance ADA claims and even collections, call in the good guy business litigator, Dean Sperling, to resolve YOUR matter with YOUR best interests in mind! 

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