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Immune from COVID-19 Liability?

The evolving pandemic response continues to produce a plethora of legal issues. One such issue is whether to provide legal immunity to certain industries from COVID-19 related litigation.  For health care providers and nursing home operators, legal immunity would stop claims resulting from acts taken and medical decisions made when providing care for somebody with confirmed, and presumed positive, cases of COVID-19.  For business owners, legal immunity would halt claims brought by patrons who potentially contracted COVID-19 on their premises and/or from their services.  Industry representatives and trade organizations/associations have already voiced their concerns about COVID-19 related litigation. For example, the Florida Chamber of Commerce, Florida Hospital Association, Associated Industries of Florida, Florida Justice Reform Institute, and a number of other trade associations sent a letter requesting legal immunity from civil and criminal liability resulting from treating COVID-19 patients.

On the federal level, The U.S. Chamber of Commerce, National Association of Manufacturers, and National Federation of Independent Businesses all recently sought legislation to shield their members from liability where certain health and safety guidelines are followed.

State Legislation:

States are already seeking to provide a shield from COVID-19-related claims for certain industries.

  • Utah recently enacted legislation to immunizes business owners “from civil liability for damages or an injury resulting from exposure of an individual to COVID-19” on their premises.
  • New York passed the Emergency Disaster Treatment Protection Act, which provides immunity to hospitals, nursing homes, physicians and nurses, and other health care providers for malpractice and negligence in the treatment of COVID-19 patients.
  • Pennsylvania (by Executive Order), Wisconsin, and North Carolina have also codified laws which provide legal immunity to certain industries.

This trend towards state-level legal immunity for businesses, the healthcare industry, and the nursing home industry is growing and many other States have indicated a willingness to entertain such legislation in the short term. For example, while nothing has been filed yet in Florida, State Senator Jeff Brandes has already indicated that he would be introducing legislation which will provide a safe harbor for businesses which follow recommended guidelines.

Federal Legislation:

Congress has also been contemplating legal immunity from COVID-19 related litigation. United States Senator Ben Sasse just recently introduced a bill which seeks to limit liability for actions taken by health care providers to combat COVID-19. While not necessarily legal immunity or a limitation of liability, United States Congressman Andy Biggs has also introduced a bill which would have a similar effect. Congressman Bigg’s bill provides that the act of opening a business (by itself) is not negligent within the context of federal civil actions that include a claim alleging negligence arising from the transmission of COVID-19.

High ranking government officials have also issued their support for legal immunity. Senate Majority Leader Mitch McConnell has indicated that a broad liability shield will be a top priority in the next COVID-19 relief package. When questioned about Senate Majority Leader McConnell’s proposal, President Donald Trump indicated he would support such legislation.

This trend towards granting legal immunity does not seem to be ending anytime soon. As a claimant, it is essential to know if your potential defendant is afforded immunity by state or federal law. Conversely, businesses and other industries covered by immunity laws must be aware of the procedures to be followed in order to keep said immunity.

Business Interruption Coverage Update:

As noted in our previous blog post, COVID-19 business interruption coverage has become a heavily contested issue. Multiple cases have been filed in both state and federal courts throughout the United States. While many have not yet reached a resolution, some courts have determined these cases on their merits. For example, the United States District Court in and for the Southern District of New York recently found that COVID-19 did not cause direct physical loss or physical damage to property. Therefore, there were no business interruption damages. See Social Life Magazine Inc. v. Sentinel Insurance Co. Ltd. (Case no.: 20-cv-3311-VEC, S.D. N.Y.). This decision represents the first significant victory for insurance carriers and will likely be cited in business interruption cases.

If you have any questions about legal immunity legislation and its effect on you, please feel free to contact our attorneys at (305)416-3180.

Business Interruption Coverage in Light of COVID-19

Business Interruption Coverage in Light of COVID-19

As COVID-19 continues to wreak havoc on the lives of the world’s population, substantial insurance issues have arisen in its wake. Most of these issues relate to whether commercial property insurance policies and/or other policies which include coverage for business interruption, extra income, and acts of civil authority cover losses as a result of the forced shutdown of U.S. businesses.

At their heart, policies of insurance are nothing more than contracts. We have already seen countless actions filed and anticipate there will be a flood of challenges from both a declaratory judgment and breach of contract perspective for any denials based upon:

  • the pandemic event exclusions that have been quietly inserted over the last several years after the SARS-CoV virus, as well as;
  • the general business interruption clause requiring the existence of direct physical loss to a business location.

While a strong argument exists that a virus that affects individuals is not a direct physical loss to a business, the virus itself has been studied and proven to survive on surfaces for a prolonged period of time. These arguments underpin the various state and federal actions filed throughout the U.S.

Notable Insurance Coverage Actions

Some of the more notable coverage actions relating to COVID-19 include:

  • El Novillo Restaurant et al. v. Certain Underwriters at Lloyd’s London et al. (Florida).  Filed as a class action by multiple south Florida restaurants and similarity situated parties and relying upon the civil authority provision of the commercial property policies at issue.
  • Cajun Conti, LLC, et al. v. Certain Underwriters at Lloyd’s et al. (Louisiana). Filed by a chain of New Orleans restaurants. Plaintiffs argue that contamination of the insured premises by COVID-19 would be a direct physical loss, which would trigger coverage under the relevant policy.
  • SCGM, Inc. et al. v. Certain Underwriters at Lloyd’s (Texas). Filed by a movie theater chain. The endorsement at issue (purportedly created after the Ebola Pandemic in or around 2014), allegedly covers business losses resulting from a “Pandemic Event.” Plaintiff alleges that the policy in question defines “Pandemic Event” to mean “the announcement by a Public Health Authority that a specific Covered Location is being closed as a result of an Epidemic declared by the [Centers for Disease Control and Prevention] or [World Health Organization].” The endorsement also included named certain covered diseases and variations or mutations of said covered diseases. Plaintiff alleges that one named covered disease is Severe Acute Respiratory Syndrome – associated coronavirus (SARS-CoV) disease, and that COVID-19 is a variation/mutation of said SARS-CoV.

Legislative Remedies for Business Interruption Coverage

In light of these coverage actions, the U.S. federal government has already contemplated a number of legislative remedies, including:

  • The Pandemic Risk Insurance Act of 2020, which has been proposed by the United States House of Committee on Financial Services, seeks to create a federal backstop for pandemic insurance losses in excess of $250,000,000. Based on a discussion draft for the bill, losses in excess of an individual insurer’s deductible would be shared between the U.S. Government and the insurer, with the U.S. Government paying 95%. The program is modeled after the Terrorism Risk Insurance Act, which was enacted in light of the terrorism-related insurance claims following 9/11.
  • The Business Interruption Insurance Coverage Act of 2020, which provides that each insurer that offers or makes available business interruption insurance coverage shall cover losses resulting from any viral pandemic, any forced closure of business or mandatory evacuation, by law or order of any government or governmental officer or agency (including the federal government and state and local governments), or any power shut-off conducted for public safety purposes. Of note, the legislation would nullify any exclusion that excludes losses that are covered by the Act, and preempts any state approval of said exclusions. Carriers have the ability to reinstate these exclusions, but said reinstatement requires either authorization from the insured, or the insured fails to pay any increased premium charged for business interruption coverage (any notice is provided).

If you have any questions about COVID-19 and its effect on your business or operations, please contact our offices at (305)416-3180.

Employer Responsibilities under the Families First Coronavirus Response Act

What are an employer’s responsibilities under the Families First Coronavirus Response Act?

Lydecker Diaz partners Richard Lydecker, Stephanie Pidermann, and Margaret Mevers explain below.

What is the Families First Coronavirus Response Act?

department of labor image

On March 25, 2020, the Department of Labor (“DOL”) issued guidance to the public to apprise employers of their responsibilities relating to paid sick leave and expanded family and medical leave under the Families First Coronavirus Response Act (“FFCRA”).

During these critical times, the FFCRA seeks to provide employees peace of mind via additional paid sick leave and further security through expanded family and medical leave for reasons specifically related to COVID-19. The below provisions take effect on April 1, 2020, and remain in force through December 31, 2020.

Does the FFCRA apply to my company?

Does the FFCRA apply to my company?

The FFCRA imposes responsibilities upon private sector employers of companies with 500 employees or less and certain public sector employers. Eligible employees must have been employed for at least thirty (30) days before the date of any request for leave relating to COVID-19 under the FFCRA. Employees who are unable to work, including being unable to work from home, may seek paid leave under the FFCRA due to the following reasons:

  1. The employee is subject to a Federal, State, or local quarantine or isolation order related to COVID-19.
  2. The employee has been advised by a health care provider to self-quarantine related to COVID-19.
  3. The employee is experiencing COVID-19 symptoms and is seeking a medical diagnosis to confirm whether they have contracted COVID-19.
  4. The employee is caring for an individual subject to an order described in paragraph (1) above or an individual that is in self-quarantine as described in paragraph (2) above.
  5. The employee is caring for their child whose school or place of care is closed or unavailable due to reasons related to COVID-19.
  6. The employee is experiencing any other substantially similar condition specified by the United States Department of Health and Human Services.

What paid-leave entitlements are employers responsible for?

What paid-leave entitlements are employers responsible for?

Employers who receive a request from an eligible employee for a qualifying reason listed above are required to provide up to two (2) weeks of paid sick leave. The amount of pay employers are obligated to provide is dependent on which of the above reasons are cited for the leave. Full-time employees are entitled to up to eighty (80) hours of paid leave, while part-time employees are entitled to two weeks of leave based on the average amount of hours they work in a given week (e.g., if the employee works twenty (20) hours each week, they are entitled to up to forty (40) hours of paid leave over a two-week period). The amount of paid leave that employers are required to expend is based on the higher of either the employee’s regular rate of pay or the applicable State or Federal minimum wage. Employees are entitled to paid leave at the following rates:

  • 100% of their pay for qualifying reasons one (1) through (3) above; limited to $511.00 daily and $5,110.00 overall.
  • 66.6 % of their pay for qualifying reasons four (4) and six (6) above; limited to $200.00 daily and $2,000.00 overall.
  • Employees who cite qualifying reason five (5) above are entitled to up to twelve (12) weeks of paid sick leave and expanded family and medical leave paid at 66.6% of their pay; limited to limited to $200.00 daily and $2,000.00 overall.

**It should be noted, small businesses with fewer than 50 employees may qualify for exemption from the requirement to provide leave due to school closings or child care unavailability if the leave requirements would jeopardize the viability of the business as a going concern**

What penalties is my company subject to for non-compliance with the FFCRA?

What penalties is my company subject to for non-compliance with the FFCRA?

Although no specific penalties have been outlined to date, the DOL’s Wage and Hour Division (“WHD”) has prohibited employers from discharging, disciplining, or otherwise discriminating against any employee who lawfully takes paid sick leave or expanded family and medical leave under the FFCRA. The WHD will impose penalties against employers for violations of the FFCRA. Additionally, employers who discriminate against their employees for the above-referenced reasons, or retaliate against their employees for choosing to avail themselves to their rights under the FFCRA, would potentially expose themselves to litigation and similar damages that would otherwise be available pursuant to the Family Medical Leave Act.

What steps should my company take next?

What steps should my company take next?

Given the swift nature of COVID-19 and the rapid response that the United States government is effectuating daily, it is important to equip your company with experienced counsel to assist you in navigating through these tumultuous times.

Lydecker Diaz’s labor and employment group has decades of combined legal experience in litigation and transactional matters. Time and time again, Lydecker Diaz has prevailed in employment litigation matters through trial and has counseled employers in labor matters to provide economic and efficient solutions to prevent litigation from ensuing and ensure compliance with State and Federal regulations.

For more information, contact our professionals below:

Richard Lydecker, Senior Partner

Stephanie Pidermann, Partner

Margaret Mevers, Partner

accounting malpractice

Accounting Malpractice 101: What You Should Know

Like any other professional, accountants are held certain standards and are required to abide by the law and follow these standards at all time when providing their services. In the instance that a client suffers direct losses due to the fact that an accountant did not fulfill their role as professional, that client is entitled to file an accountant malpractice lawsuit.

The GAAP – Accountant Standards Of Conduct

The particular rules that accountants are expected to follow are laid out by in the General Accepted Accounting Principles (GAAP) in addition to the rules listed by the American Institute of Certified Public Accountants in addition rules set by the State.

Certified public accountants, certified tax preparers, accounting consultants, and asset managers are all expected to follow specific guidelines and rules:

  • Do not knowingly misrepresent details or facts
  • There can be no conflict of interests
  • Only provide services that can be completed competently and with professional care
  • Meet the requirements of licensing
  • Keep client communications confidential

To establish a case of accounting malpractice, the claimant must have suffered monetary losses directly related to the alleged malpractice.

The Most Common Instances Of Accounting Malpractice

  • Maintaining substandard financial records
  • The preparation of incorrect financial reports and business statements
  • Failure to recommend an audit to clients
  • Making mistakes on tax returns
  • Giving out bad, incorrect, or illegal tax advice
  • Inventory errors
  • Fraud
  • Subpar evaluation of documents and financial statements

Breach of Contract

In accounting malpractice cases, breach of contract usually occurs intentionally or negligently. When an accountant deviates from standardized practices knowingly or carelessly, a case for accounting malpractice can be made.

For a breach of contract case to be viable in court, a few things must determined and established. First, there has to be an agreement between the accountant and the claimant to render professional services. After the establishment of an agreement, the claimant has to experience loss, damages, or financial harm that is a result of the accountant’s lack of professionalism or negligence.

Accountant Misrepresentation

When an accountant intentionally misrepresents details in order to mask their transgressions, an accounting malpractice case can be made based on those misrepresentations. To claim an accountant is guilty of intentional misrepresentation, a few things have to be established:

  1. There was an actual representation
  2. That representation was incorrect
  3. The misrepresentation is based on a current or past tangible fact
  4. The misrepresentation can actually be proved right or wrong
  5. The accountant persuaded the plaintiff based on that misrepresentation
  6. The plaintiff relied on that misrepresentation and suffered losses
  7. The misrepresentation can be directly tied to the losses.

Contact Lydecker-Diaz For A Legal Consultation

Accounting malpractice cases are intricate and often very complicated due to the specific determinations that must be made in order to establish a viable case. At Lydecker Diaz, we have years of experience in recovering damages for our clients that were victims to accountant malpractice. Our Miami accounting malpractice attorneys are ready to speak with you and are fully dedicated to your best interests. Contact us today for a legal consultation.

The 14 Most Common Kinds Of Legal Malpractice Errors

There are various errors that comprise a majority of the thousands of legal malpractice claims in the United States each year.

1. Failure to Know/Apply The Law

Failing to know or the apply the law properly is the most common type of legal malpractice claim in the United States. This legal malpractice error is defined almost exactly how it sounds.

Failure to know or apply the law can be defined in two ways:

  1. When an attorney is not fully aware of all the legal circumstances and details surrounding a case.
  2. When an attorney is aware of all legal principles but fails to implement appropriate strategies due to negligence.

2. Planning/Strategy Errors

Planning and strategizing is an absolute must before any legal proceedings. A planning or strategy error claim usually arises if an attorney does not plan adequately enough and this, in turn, hurts the client’s case.

3. Failure to File Documents Without a Deadline

Not having a deadline to file documents is not an excuse for not filing it. You would be surprised to know that this is a very common legal malpractice error. Attorneys are expected to file all necessary documents on their clients’ behalf regardless of time-sensitivity.

4. Inadequate Discovery Of Facts | Inadequate Investigation

This is a legal malpractice error that involves claims that the attorney didn’t perform a thorough investigation or did not use the appropriate methods of discovery to ensure an adequate investigation.

5. Failure to Calendar

Attorneys are required to stay on top of all deadlines, court dates, and documentation on behalf of their clients. If a lawyer is aware of a deadline but failed to take initiative and misses it, a case for failure to calendar can be made.

6. Failure to Know Deadline

When an attorney is completely unaware of a deadline or failed to know how the deadline applies in a particular case.

7. Procrastination

Procrastination claims arise when a lawyer simply doesn’t deal with a client’s matters in a timely enough fashion and this in turn leads to a loss for the client.

8. Failing to Obtain Client Consent

Failure to obtain client consent covers two instances:

  1. When the client claims that he/she would’ve made a different choice if the attorney had explained all the details, offered viable alternatives, or fully explained the risks involved.
  2. When a lawyer needs consent from a client to take action but fails to do so.

9. Conflict Of Interest

If a lawyer has a matter that conflicts with the interests of his/her client, a legal malpractice claim can be made. It doesn’t matter whether or not the attorney was aware of the conflict.

10. Fraud

One of the more self-explanatory claims, fraud is simply defined as any fraudulent actions taken by the attorney.

11. Failure To Follow Instructions

Another self-explanatory claim. Attorneys are supposed to follow the instructions of their clients and a failure to follow instructions claim can be made whether or not the failure was intentional or unintentional.

12. Error In Record Search

If a title, patent, or trademark search does not disclose important items on public record a case for error in record search can be made. This also applies when no public search was conducted when it should have been

13. Clerical Errors

Clerical errors refer to typographical errors and the transposing of numbers in legal documents that would have otherwise been corrected with effective proofreading.

14. Improper Withdrawal

This covers claims that an attorney has not properly withdrawn representation by due to lack of proper communication.

Contact Lydecker Diaz For Legal Malpractice Defense

At Lydecker-Diaz, our team of Miami legal malpractice attorneys has years of experience representing other lawyers in attorney malpractice claims. Contact us today to schedule a legal consultation.

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