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Corporate America Wants COVID-19 Legal Immunity
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Corporate America Wants COVID-19 Legal Immunity

Companies Want Congress to Grant Blanket Immunity; They Might Get It

Philip Mattera

Congressional Republicans either are backing off immunizing corporations from COVID-19 lawsuits — or they are opaquely maneuvering for the proposal.

What I find amazing is that business lobbyists and their GOP supporters think they can sell the country on the idea. It would be a brazen giveaway to corporate interests.

There are numerous compelling arguments against immunity, but I want to focus on one: the track records of corporations themselves.

Proponents of a liability shield imply that large companies normally act in good faith and that any coronavirus-related litigation would be penalties for conditions outside their control. These lawsuits, they suggest, would be frivolous or unfair.

Every large corporation is, to at least some extent, a scofflaw when it comes to employment, environmental and consumer protection issues … Companies may respond to a difficult business climate by cutting even more corners.

This depiction of large companies as innocent victims of unscrupulous trial lawyers is a long-standing fiction. Business lobbyists use the depiction in promoting tort reform, the polite term for the effort to limit the ability of victims of corporate misconduct to seek redress through the civil justice system.

That campaign has not been more successful because most people realize that corporate negligence is a real thing.

Terrible Records

In fact, some of the industries that are pushing the hardest for immunity are ones that have terrible records on regulatory compliance. Take nursing homes, which have already received a form of COVID-19 immunity from New York State.

That business includes the likes of Kindred Healthcare, which has had to pay out more than $350 million in fines and settlements.  The bulk of that amount has come from cases in which Kindred and its subsidiaries were accused of violating the False Claims Act by submitting inaccurate or improper bills to Medicare and Medicaid. Another $40 million has come from wage and hour fines and settlements.

Kindred has also been fined more than $4 million for deficiencies in its operations. This includes more than $3 million it paid to settle a case brought by the Kentucky attorney general over issues such as “untreated or delayed treatment of infections leading to sepsis.”

Meatpackers, Too

Or consider the meatpacking industry. It has experienced severe outbreaks yet is keeping open many facilities.

This sector includes companies such as WH Group, the Chinese firm that has acquired well-known businesses such as Smithfield. WH Group’s operations have paid a total of $137 million in penalties from large environmental settlements as well as dozens of workplace safety violations.

Similar examples can be found throughout the economy. Every large corporation is, to at least some extent, a scofflaw when it comes to employment, environmental and consumer protection issues. There is no reason to think this will change during the pandemic. In fact, companies may respond to a difficult business climate by cutting even more corners.

The two ways such misconduct can be kept in check are regulatory enforcement and litigation. We have an administration that believes regulation is an evil to be eradicated.

This makes the civil justice system all the more important, yet business lobbyists and Congressional allies are trying to move the country in exactly the opposite direction. They want to liberate Big Business from any form of accountability, giving it what amounts to an immunity passport.

Heaven help us if they succeed.

May 25, 2020