By Celeste Bott

Law360 (December 3, 2020, 11:14 PM EST) -- The Trump administration continues to argue its order blocking certain visa holders from moving to the U.S. was a necessary response to the pandemic, Transportation Security Administration employees say they're owed virus hazard pay, and Norwegian Cruise Line wants out of a shareholder suit claiming it ran a deceptive sales campaign downplaying COVID-19.

While courts across the country are altering procedures, restricting access and postponing certain cases to stem the spread of the coronavirus, the outbreak has also prompted a wave of litigation across the country.

Here's a breakdown of some of the COVID-19-related cases from the past week.

Employment

A Teamsters union local has asked a Pennsylvania federal judge to dismiss or pause a Giant Eagle Inc. subsidiary's suit alleging the union violated a collective bargaining agreement by backing a pandemic-inspired workplace "slowdown," saying a pending union grievance must play out first.

In a brief supporting its motion to dismiss filed Tuesday, Teamsters Local 636 told U.S. District Judge Christy Wiegand it has filed a grievance over the firing of a union member who allegedly organized the slowdown, and that the grievance process outlined in the CBA must wrap up before OK Grocery Co. can turn to the courts for relief.

OK Grocery's suit, filed in October, alleges the Teamsters local broke its CBA with the grocer by supporting a "slowdown and sickout" organized by union member Tim Basile in violation of provisions in the CBA prohibiting workers from striking. OK Grocery fired Basile, claiming to have caught him on video posting fliers that encouraged workers to take advantage of a company policy that suspended discipline for violations of its attendance policy during the pandemic. In October, Local 636 filed both a formal grievance and an unfair labor practice charge with the National Labor Relations Board over the firing.

In Illinois, a former dockworker for freight firm Estes Express sued the company in federal court Monday, alleging he was fired for refusing to stay at work after he learned that two colleagues who had recently been there were infected with the novel coronavirus.

Jamaal Watts alleges that the company "exhibited reckless disregard" for his safety in late April when it mandated that he continue working at a Joliet, Illinois, facility after he found out that two colleagues who had been working that day had been infected with COVID-19. Watts went home early anyway because of his fears of exposure, according to his complaint and his lawyer, after which Estes fired him when he reported to work the next day.

And a TSA employee filed a proposed class action Monday against the federal government alleging that agency workers are being deprived of required hazard and environmental discharge pay for work at airports during the pandemic.

According to the suit from TSA employee Marion Higgins, federal law provides for a 25% pay boost to government workers exposed to "virulent biologicals" such as the COVID-19 virus and a 4% or 8% increase for exposure to dangerous microorganisms, but TSA workers have not been issued the payments.

The suit was filed on behalf of all TSA workers whose primary duty is to screen and come into close contact with travelers at airports since January. Citing a USA Today article, Higgins said that at least 2,885 TSA employees have tested positive for COVID-19 and nine have died as of Nov. 17.

Sports & Betting

A New Jersey gym facing an enforcement order and hefty fine after defying Gov. Phil Murphy's COVID-19 shutdown orders can't get a civil lawsuit against it paused while the gym's owners battle criminal charges, a state judge has ruled.

Atilis Gym repeatedly flouted pandemic orders to shut down, and Superior Court Judge Robert T. Lougy hit the gym with a $134,000 judgment in August. The judge denied the gym's request for a stay in the case while criminal matters are resolved in Bellmawr Municipal Court in an order made public last week.

The gym argues that the state needs to provide a scientific basis for forcing businesses to close, but the court said owners Ian Smith and Frank Trumbetti should have challenged the order by appealing it, not through defiance.

The battle began in federal court with Atilis' May lawsuit alleging that Murphy's shutdown of nonessential businesses in March ran afoul of federal civil rights laws, as well as the due process and equal protection clauses of the Fifth and 14th Amendments to the U.S. Constitution.

Consumer Protection

Norwegian Cruise Line slammed investors' claims that it ran a "top-down" deceptive sales campaign downplaying the COVID-19 pandemic to prospective customers in order to stave off revenue losses, maintaining that it doesn't have to disclose allegedly aggressive sales practices.

The Miami-based cruise line has urged a Florida federal judge to dismiss a consolidated securities fraud class action from lead plaintiff Employer-Teamsters Local 175 & 505 Pension Trust Fund claiming investors were left holding the bag when Norwegian's deceptive sales campaign made headlines in March and triggered government investigations.

Norwegian argues that public companies aren't required to make disparaging remarks about the performance of their employees or accuse themselves of uncharged wrongdoing. And there's nothing in the pension fund's amended complaint pinpointing any specific statement made by Norwegian or its top brass that might've been materially misleading to investors, the company said.

A Florida federal judge on Sunday denied Lynn University's bid to dismiss a proposed class suit over its decision not to issue partial tuition and fee refunds after classes were moved online due to the COVID-19 pandemic.

U.S. District Judge Rodolfo A. Ruiz II declined to dismiss breach of contract and other claims against Lynn, a private university in Boca Raton, Florida, saying more factual development is necessary to clarify the terms and conditions of the relationship between the school and its students.

The judge rejected the university's argument that lead plaintiff Raymond Gibson's breach of contract claim is barred because he continued to attend courses remotely and accepted credits. Judge Ruiz said it is unclear whether Gibson, an undergraduate student, knew he could reject the contract at any point during the spring semester.

Legal Industry

The Boston Bar Association has urged the Massachusetts Supreme Judicial Court to hold an upcoming hearing in a criminal case in person, arguing virtual hearings can cause unconstitutional disparities for low-income communities and people of color.

In a 40-page amicus brief, the bar argued that virtual hearings unfairly impact minorities and low-income households, compounding hardships they already face in light of the COVID-19 pandemic and systemic racial injustices.

The bar filed its brief in Vazquez Diaz's appeal of a trial judge's ruling rejecting his request that a hearing on evidence suppression be held in person rather than online. Diaz, who speaks Spanish and requires an interpreter, faces more than a decade in prison on a drug-trafficking charge, but he sought to suppress certain evidence and statements in a motion that alleges unlawful police conduct, according to court documents. The case headed to the Supreme Judicial Court for oral argument on Dec. 7.

And a Georgia federal judge on Monday raised a series of concerns about the viability of an insurance suit filed by a law firm seeking to enforce property policy coverage for losses triggered by COVID-19 and a state-ordered shutdown.

Addressing a dismissal bid by Hartford Casualty Insurance Co., U.S. District Judge William M. Ray repeatedly voiced doubt to plaintiff's counsel about establishing damages, and whether alleged income losses could be tied to the shutdown itself rather than to decisions made by the firm and its clients to avoid health risks. Speaking via Zoom,  he also said he was concerned about whether the firm, Karmel S. Davis & Associates, would have to use "junk science" to try to show the virus had been present in, and thus physically damaged, its office. 

Insurance

An Illinois federal judge tossed out a mattress company's lawsuit seeking coverage for losses it incurred through statewide COVID-19 shutdown orders but said the company can have another bite at the apple and replead its case.

Dismissing AFM Mattress Co.'s declaratory judgment suit without prejudice, U.S. District Judge Manish Shah said the "straightforward" text of its insurance policy with Motorists Commercial Mutual Insurance Co. excludes coverage for damages or losses "resulting from any virus."

Motorists' policy covers AFM when certain causes of loss damage its property and trigger a civil authority to prohibit store access. But "damage from a virus was not a covered cause of loss — the policy explicitly excluded coverage for virus-related loss," Judge Shah said.

Travel insurer Assicurazioni Generali Group's U.S. branch is pushing back against a proposed class action by a policyholder claiming it failed to cover a trip she had to cancel because of COVID-19, saying the pandemic was already a known and foreseeable risk and therefore it's outside the policy's bounds.

In a motion to dismiss, Generali said that its trip insurance policy sold to Audra Sanchez is meant only to cover "unforeseeable" risks, such as sudden weather events like earthquakes and hurricanes, but that COVID-19 was already a well-known and foreseeable risk by May when she bought the policy. The pandemic was already spreading in communities across the country including Sanchez's by that point, the insurer argued, saying it's implausible that she couldn't have expected the trip to be canceled because of the virus.

Sanchez sued in August, alleging that Generali U.S. has refused to provide reimbursements for a canceled road trip and accommodations in Texas, only offering a voucher that she never requested.

In Nevada, a Clark County judge rejected an insurer's bid to toss a COVID-19 business interruption coverage suit from the owner of Las Vegas' Grand Bazaar open-air mall, holding that the owner sufficiently alleged property damage and the policy's contamination and pollution exclusion does not apply to virus-related losses.

Judge Mark Denton ruled Monday that JGB Vegas Retail Lessee LLC has shown enough facts to allege a direct physical loss of or damage to its property under its policy with Starr Surplus Lines Insurance Co., finding that the insurer failed to demonstrate that the pollution exclusion bars coverage for COVID-19 related losses.

In June, JGB sued Starr in Nevada state court, seeking coverage for its losses from being forced to shut down due to state-mandated orders in March. The insurer removed the suit to Nevada federal court in July before the federal court remanded the action back to the state court in September, finding a lack of complete diversity between the parties for the case to stay in federal court.

And an Iowa federal judge ruled Monday that the insurer of a group of Iowa bars is not obligated to cover financial losses resulting from COVID-19 closure orders, finding that the eateries failed to allege "direct physical loss or damage to their covered properties."

U.S. District Judge John A. Jarvey held that because Whiskey River on Vintage and two other Whiskey River locations had a virus exclusion provision in their coverage, breach of contact and bad faith claims against Illinois Casualty Co. failed.

Commercial Contracts

Northeastern University hopes to duck a suit brought by students seeking reimbursement for classes shifted online due to the Covid-19 pandemic, telling a judge during a hearing Thursday that students were never promised in-person classes under any circumstances.

The school is one of several facing proposed class actions in the wake of the move to fully remote learning during the spring, when coronavirus cases first surged. The Boston school's lawyer, John Shope of Foley Hoag LLP, told U.S. District Judge Richard G. Stearns that the Financial Responsibility Agreement between the university and its students was never meant to incorporate every aspect of the class registration process.

To interpret the contract that way would lead to some absurd results, he said, such as arguing a breach of the agreement if Northeastern changed a class from 2 p.m. to 8 a.m.

Public Policy

A group challenging COVID-19 rules in Massachusetts told the state's top court that the U.S. Supreme Court's recent decision striking down restrictions on New York church gatherings overrides legal precedent relied on by Gov. Charlie Baker.

In a supplemental brief on Saturday, the New Civil Liberties Alliance argued to the Massachusetts Supreme Judicial Court that the view from the nation's highest court is that courts should apply a more skeptical eye and a higher bar for governors who want to shut down businesses during the pandemic.

During oral arguments before the court in September, Baker's administration defended his ability to use the state's Civil Defense Act to close businesses deemed non-essential and impose other sweeping measures to combat the spread of the virus.

The defense was predicated, in part, on Chief Justice John Roberts' concurrence in South Bay United Pentecostal Church v. Newsom , a May opinion that called for deference to be afforded to governors as they battled the spreading disease. But the NCLA argued in its recent brief that the Thanksgiving Eve majority ruling in Roman Catholic Diocese of Brooklyn v. Cuomo supersedes the chief justice's earlier opinion.

And a Boston-area defense attorney has filed a lawsuit seeking to unearth documents showing what the U.S. Department of Veterans Affairs paid for personal protective equipment during the springtime COVID-19 surge, information that could be relevant in criminal price-gouging cases.

Susan Winkler of Winkler Law LLC said in a Freedom of Information Act complaint filed on Thanksgiving that the VA has stonewalled her requests since early September to reveal the prices it paid for PPE at facilities in Massachusetts, Texas, Georgia, Iowa, Illinois and Maine.

She argued that getting a sense of the going rate for PPE during the pandemic's early days can set a benchmark for what might constitute price gouging, something the U.S. Department of Justice has devoted a nationwide task force to combat since March.

Immigration

The Trump administration urged the D.C. Circuit to keep intact a presidential order blocking certain visa holders from moving to the U.S., saying the visa ban was necessary to shore up the U.S. response to the coronavirus-fueled economic downturn.

President Donald Trump fulfilled the "sole prerequisite" that the Supreme Court set on his authority to block noncitizens from entering the country when he explained that the domestic job market, plagued with rising unemployment as a result of the pandemic, had to be shielded from foreign workers, the administration said Monday in response to immigrants' claims that the ban's economic rationale didn't hold up.

In September, a lower federal court ruled that the visa ban was constitutional, while also finding that the State Department had illegally stopped processing certain visa applications under the visa ban.

Native American

The Indian Health Service told a New Mexico federal judge Tuesday that it should not be forced to immediately renew its contract with Sage Memorial Hospital on the Navajo Nation, saying the hospital's case doesn't meet requirements for emergency relief.

Sage has not demonstrated that it is likely to succeed in proving that IHS violated federal law when it declined to renew the hospital's contract for funding and access to federal programs and supplies this year, IHS claimed in opposition papers. Rather, the agency argued, the court will see that Sage failed to submit a valid renewal proposal to administer tribal health care services under the Indian Self-Determination and Education Assistance Act.

Sage filed suit on Nov. 13, saying that the agency's failure to renew its ISDEAA contract was compromising crucial health care services during the coronavirus pandemic. The court must act quickly so the hospital can provide urgently needed care to the Navajo Nation without further cutting into its reserves, Sage claimed.

--Additional reporting by Craig Clough, Jeff Sistrunk, Linda Chiem, Dorothy Atkins, Lauraann Wood, Chris Villani, Emma Whitford, Tim Ryan, Daphne Zhang, Alyssa Aquino, Anne Cullen, Carolina Bolado, Diamond Naga Siu, Mike Curley and Andrew Strickler. Editing by Brian Baresch.

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