COVID-19 Class Actions Weekly Round-Up - June 2020

Bennett Jones LLP

Bennett Jones LLP

The pace of new class actions in Canada remains comparatively slower than in the United States. This past week saw additional claims against elder care facilities for their response to the pandemic, and against insurance companies for denial of COVID-19 related claims. There were also claims brought by Lyft drivers seeking a more inclusive paid sick leave policy, and investors who bought shares in a therapeutics company that may or may not have claimed to discover antibodies that could cure COVID-19.

Negligence and Breach of Contract Actions

  • In Ontario, a claim has been filed on behalf of all residents of Orchard Villa and their family members against Southbridge Care Homes Inc. The claim alleges negligence in the facility’s handling of its COVID-19 response. 
  • In Québec, a claim has been filed against CHSLD on behalf of residents at the Vigi Mont-Royal and their families alleging gross negligence and neglect. The claim seeks compensation for the pain, suffering, stress and inconvenience experienced by residents since the pandemic began.
  • In Florida, a claim has been filed by ticketholders against the organizers of the 2020 Ultra Music Festival seeking cash refunds. The annual festival, which had been scheduled to take place in Miami this March, was postponed because of COVID-19. Instead of full cash refunds, the festival's organizers offered tickets to future festivals in either 2021or 2022. 
  • In New York, Deloitte has been sued after the web portal it established to help state governments process applications for the Pandemic Unemployment Assistance Program suffered a data breach. The plaintiff claims that Deloitte's inadequate safeguards led to the disclosure of her personal information including her address and social security number to third parties.

Employment Actions

  • In Washington, D.C., a Lyft driver has sued the ride-sharing company, asserting that its paid sick leave policy does not comply with municipal law. Earlier this year, Lyft announced that it would provide paid sick leave to “drivers diagnosed with COVID-19 or put under individual quarantine by a public health agency—for an amount determined by the driver's previous activity on the Lyft platform.” The plaintiff alleges that this narrow paid sick leave policy falls well below the standard set by the D.C. Accrued Safe and Sick Leave Act, which requires large employers to provide at least one hour of paid sick leave for every 37 hours worked.

Insurance Actions

  • In Québec, a Laval-based restaurant has launched a class action against Promutuel Assurance after the insurer denied its business interruption claim brought under an all-risk commercial insurance policy. The claim has been brought on behalf of all restaurants or bars in Québec forced to close or limit their business operations as a result of COVID-19 related government orders.
  • In Georgia, a dentist has brought a class action against The Cincinnati Insurance Company after the insurer denied his business interruption claim. The claim notes that unlike other policies (many of which have been the subject of previous class action complaints over the months before), the “Dentist's Package” bought by the plaintiff did not exclude losses caused by the spread of viruses and communicable diseases. The plaintiff alleges that the policy covered a “slowdown or cessation” of business caused by direct physical loss or damage.

Shareholder Actions

  • In California, a class complaint has been filed against Sorrento Therapeutics Inc. alleging that Sorrento engaged in a scheme to deceive the investing public. On May 15, Sorrento announced that it had discovered an antibody that “demonstrated 100% inhibition of SARS-CoV-2 virus infection”. The CEO allegedly called the breakthrough a "cure" on Fox News. Sorrento shares soared nearly 300 percent from their May 14 closing price. On May 20, after the release of a report doubting the validity of Sorrento's claims, the stock price declined precipitously. Sorrento's CEO has since insisted that his statement had been misrepresented, and that he had only said the antibody was “potentially” a cure. 
  • In Florida, Carnival Corporation investors allege that the cruise company and several of its officers made a series of false and misleading statements about the company's adherence to health and safety protocols in the wake of COVID-19. Among other allegations, the plaintiffs allege that the company was withholding information about infections aboard its ships and failed to alert passengers about potential exposure to the virus.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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