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Chamber-Backed House Bill 118 Passes General Assembly with Overwhelming Support

| Tort Reform & Legal Climate

Recently, the N.C. House voted overwhelmingly (110-5) to pass House Bill 118 (COVID-19 Liability Safe Harbor). The bill – which increases immunity protections for businesses facing litigation claims from COVID-19 – had already received a strong showing of bipartisan support (40-7) in the Senate last week. On July 2, Gov. Cooper put his signature on the bill, securing an important Chamber priority that will be key to enabling our state’s employers to mount an effective economic rebound from COVID-19

Many of you will recall the unanimous passage of Senate Bill 704, one of two bills encompassing the first major coronavirus relief package passed by the General Assembly during their early May session. That bill provided limited immunity to health care facilities and providers impacted by the COVID-19 pandemic, and gave similar limited immunity to essential businesses providing goods or services in the course of the pandemic. In both instances, the immunity from civil liability did not extend to acts constituting gross negligence, gross misconduct (or “reckless misconduct” in the health care setting), or intentional infliction of harm.

Given that a growing number of businesses – not only those deemed “essential” – are now re-opening, House Bill 118 builds upon Senate Bill 704 and can be construed in tandem with the protections passed in that bill as it provides limited immunity to any business alleged to be liable for an act or omission that resulted in the contraction of COVID-19, so long as such alleged acts or omissions do not rise to the level of gross negligence, willful or wanton conduct, or intentional wrongdoing. Unlike Senate Bill 704, the protections in House Bill 118 do not expire upon rescindment of the Governor’s Executive Order declaring a state of emergency; instead, they will extend until 180 days after the Order is rescinded.

Notably, House Bill 118 requires business owners to provide “reasonable notice of actions taken by the [business to reduce] the risk of transmission of COVID-19 to individuals present on the premises.” This requirement is new and nothing similar appeared in Senate Bill 704. Language in House Bill 118 makes clear that a business will not be liable for the failure of “any individual” to comply with the list of actions provided pursuant to the notice requirement. It should also be noted that the measures contained in the bill do not apply to claims of workers’ compensation benefits related to COVID-19.

A wave of COVID-19 litigation claims has been building in recent months, with one law firm, Hunton Andrews Kurth, reporting more than 2,900 such claims nationwide. In light of this growing number of lawsuits, House Bill 118 will provide welcome and much-needed protections to safeguard North Carolina businesses against predatory COVID-19 claims as we work to relaunch our state’s economy. We thank the governor and members of the General Assembly from both sides of the aisle who signaled their understanding of the needs of job creators by supporting this bill.