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Liability lawsuits are almost an inevitable part of operating a hotel, but coronavirus is a new legal frontier for hospitality lawyers.
It is a matter of when, not if, a wave of litigation unfurls against property owners from plaintiffs claiming they were exposed to the virus at a commercial property like a hotel, lawyers interviewed by Skift say. A late February medical conference at the Marriott Long Wharf in Boston was labeled a “super spreader,” where attendees unknowingly contracted the virus and later passed it on upon returning to homes in states like Tennessee and North Carolina.
At a time when social distancing is a key combative measure against the spread of the virus, group events could be seen as the ultimate hospitality liability. But successfully winning a coronavirus claim against a hotel owner will be more difficult than prior health threats.
“First of all, this is the United States, so there will be litigation, no matter what,” said Goodwin partner Teresa Goebel, who is also the chair of the law firm’s hospitality and leisure practice. “If a person gets sick, they’ll sue – whether they have the basis to or not. For the hotel owner and operator’s perspective, it’s what obligations they have to a guest to keep them safe. It’s a new issue, but I think the general standard is you have to take prudent standards to keep guests safe.”
To be clear, no legal action has been taken against the Boston Marriott Long Wharf regarding coronavirus. Representatives with Marriott did not respond to Skift’s request for comment by publication. But lawyers interviewed for this story, while not speaking specifically about the Long Wharf hotel, said it could be difficult to proceed with coronavirus-related legal action against a property, even if an alleged case occurred during the early stages of the outbreak.
“Generally, the courts look at what’s reasonable under the circumstances, so what was reasonable in February is going to be different than what’s reasonable now,” Goebel said. “A hotel that takes no precautions now isn’t reasonable whereas, in February, no hotel really took significant precautions.”
Hotel companies are partnering with cleaning companies and medical institutions on heightened cleaning and safety standards some see as a marketing strategy to win over travelers in the early days of the coronavirus recovery. Hilton consulted with the Mayo Clinic, Four Seasons collaborated with Johns Hopkins Medicine International, and Accor partnered with insurance provider AXA. But these new operational practices could also be utilized as a legal defense against someone filing a coronavirus liability lawsuit against a hotel owner.
“You’re seeing luxury operators and big brands partner with large health institutions to help establish some level of, ‘We didn’t come up with these standards. We went to medical experts. You can’t fault us if this didn’t work because we went to medical experts,’” said Goodwin partner Benjamin Tschann, who is also in the hospitality and leisure practice with Goebel.
Proving a coronavirus case came from a specific property is extremely difficult unless the guest never left the hotel. Tschann, Goebel, and four other attorneys who Skift spoke to compared coronavirus liability cases with those of legionnaire’s disease, a pneumonia that can be spread by bacteria in water systems. It is relatively easy to trace legionnaire’s outbreaks to the source, as seen with an Atlanta Sheraton outbreak in 2019. But coronavirus, given its high rate of infection, is harder to trace, which could be an advantage for hoteliers facing a liability suit.
If a guest stayed at a hotel where someone tested positive for coronavirus but also frequented multiple offices, restaurants, airports, and airplanes, it is increasingly less certain where their own contraction came from. While this may bode well for a defense strategy, commercial property owners are likely facing a wave of legal headaches until more clarity or case law evolves from the pandemic.
“It will create this real nightmare scenario for anyone who operates a facility where people come into. Just think about office space and reentry,” Tschann said. “If you work on the 26th floor, and someone on the 24th floor has Covid-19, can you sue the landlord because you and the infected person rode in the elevator together or the same elevator at different times?”
While it may be a legal headache and the burden of proof is high, attorneys still anticipate a litigious dam to break with respect to coronavirus.
“I find it hard to imagine how a plaintiff can establish liability and prove they had been infected at a specific hotel,” Dalton & Finegold partner Kenneth MacKenzie said. “That said, I can imagine the types of attorneys who advertise on TV are filing their teeth right now and looking for the basis of injury claims against the hospitality industry for Covid-related deaths.”
The Double-Edged Sword of New Brand Standards
Guests looking to sue a hotel owner face a proof hurdle in any coronavirus liability lawsuit. While tough to prove, the hurdle isn’t insurmountable.
“All the different brands are coming out with new cleaning requirements, and that’s fantastic from a marketing standpoint and give guests comfort,” said DLA Piper partner Sandi Kellman, who is a global co-chair of the law firm’s hospitality and leisure practice. “On the other hand, I think that is going to create some sort of negligence threshold. Once you’re committing to these standards, these owners sure as heck better be following through.”
New health and safety standards call for practices like mandating employees wear masks and gloves, social distancing, more frequent cleanings in public spaces, and heightened focus on cleaning high-touch areas like a check-in desk or television remote control. The standards may give guests peace of mind, but if the guest still comes forward with a coronavirus claim, there are now more areas to point to for potential negligence where an operator cut corners or a staff member wasn’t adhering to all the new rules. Kellman thinks it will be difficult to prove a coronavirus case, but it isn’t impossible for a case to move forward.
“The standards provide more predictability in what a guest has a right to expect versus what an operator is providing,” Kellman said. “If you are a guest filing suit and you can prove the hotel owner wasn’t complying with the brand standards or the American Hotel & Lodging Association standards, I think you’ve got a clearer shot.”
An Uncertain Date in Court
Coronavirus cases have been easier to track in other travel sectors like the cruise industry than hotels, where the Marriott Long Wharf in Boston remains the only high-profile coronavirus hot spot in the industry. The limited number of hot spots to date could turn plaintiff attorneys off from moving ahead with lawsuits. With legionnaire’s disease, it is easier to track back to one poorly maintained water system and assemble a group of cases for a class action lawsuit. Coronavirus is a different story.
“It’s often not cost-effective for plaintiff lawyers to take one case and bring it against one operator,” Goebel said. “They typically want to get a class action with many cases, but I think it’s going to be difficult for them to get class actions going because every person with it is going to have a question of how they first contracted coronavirus.”
If a case is allowed to move ahead, there is also the uncertainty in whether liability insurance policies extend to infectious diseases. All the attorneys interviewed for this story said they are advising clients to review their liability insurance policies, many of which have an exclusion for communicable diseases.
A consortium of travel and retail industry groups like the American Hotel & Lodging Association and the U.S. Travel Association sent a letter to congressional leadership earlier this month asking for legislative action to provide “limited safe harbors from liability in the face of a public crisis.” Liability litigation does nothing to prevent the spread of coronavirus and would cripple businesses already struggling to recover from the economic downturn, the organizations argued.
Kellman doesn’t rule out some initial degree of insurance coverage from coronavirus claims due to it qualifying as a general negligence matter in the vein of a guest suing for slipping on a wet floor in a hotel lobby. But she expects more insurance companies will add contagious disease exclusions from liability coverage going forward.
The legal outlook for coronavirus liability claims is murky, largely due to most entities currently in survival mode over recovery. Even when the first round of lawsuits gets filed, it may never become evident what is a reasonable case and what isn’t in terms of who is liable for the spread of coronavirus – especially at a hotel.
“What often happens in practice is the cost of litigation is so high that many things get settled and you don’t develop good case history or case law to show what, in fact, people would take into consideration to determine what is reasonable or not,” Tschann said.