Tag: COVID-19

EPA Issues Compliance Advisory Regarding Pesticide Devices Making Claims to Kill the Novel Coronavirus

In late May, the U.S. Environmental Protection Agency (EPA) issued a Compliance Advisory providing the public with information regarding the limits of governmental review of the efficacy of pesticide devices, especially pesticide devices that claim to kill the novel coronavirus that causes COVID-19 (coronavirus).  Per the Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA), chemical pesticides must be reviewed and approved by EPA for efficacy claims made by the pesticide registrant before marketing is permitted.  In contrast, FIFRA prohibits pesticide device sellers from making false or misleading claims about the safety or efficacy of their pesticide devices, but it does not require EPA approval before a pesticide device may be sold.  Thus, pesticide devices (an instrument or other machine) designed to kill a pest do not undergo pre-market review for efficacy.

Because there is no pre-market review of pesticide device efficacy, and since EPA “is receiving a steady stream of tips/complaints concerning potentially false or misleading claims” associated with pesticide devices being sold with claims of killing coronavirus, EPA’s Compliance Advisory  sets out some cautionary statements:

“Please note that ozone generators, UV lights and other pesticide devices may not be able to make claims against coronavirus where devices have not been tested for efficacy or safety for use against the virus causing COVID-19 or harder-to-kill viruses.  In addition, because EPA does not review these data as part of a registration review process, these claims are not supported by any government review.” [Emphasis in original].

The Advisory reviews EPA’s process for approving chemical pesticides, and specifically the process EPA uses to maintain its “List N”—a list of disinfectants that meet EPA’s criteria for use against coronavirus.  The Advisory notes that consumers’ success in killing viruses using List N pesticides depends on following all label directions including heeding the recommended contact time, which is the amount of time the pesticide product needs to remain wet on a surface.

The Advisory also describes the limits prescribed by FIFRA for pre-market review and approval of pesticidal devices and warns that EPA cannot confirm whether, or under what circumstances, such pesticide devices might be effective against the spread of coronavirus.  The Advisory specifically cautions that “consumers should be aware that pesticidal devices making such claims have NOT been reviewed and accepted by EPA”.

Pesticide device sellers are allowed to make certain efficacy claims, as long as they possess supporting data.  FIFRA does impose penalties for making false or misleading labeling claims about the safety or efficacy of a pesticidal device.

The Advisory concludes with ‘Compliance Concerns’ and warns sellers who attempt to profit from sales of pesticides or pesticide devices with unapproved or unsupported claims for use against coronavirus:

“EPA intends to pursue enforcement against products making false and misleading claims regarding coronavirus. EPA is working with e-commerce platforms to remove/prohibit these fraudulent and/or otherwise inefficacious products from the marketplace. EPA is also coordinating with the U.S. Department of Justice and other federal partners to bring the full force of the law against those selling or otherwise distributing violative products.”

© 2020 Van Ness Feldman LLP

For more EPA regulation, see the National Law Review Environmental, Energy & Resource law section.

IMS Insights Podcast: Episode 16-How Attorneys Can Leverage Trial Presentation Consultants to Advance Cases Amid COVID-19

In this episode of the IMS Insights Podcast, we speak with trial presentation advisor Jeff Dahm about utilizing trial presentation consultants amid the COVID-19 pandemic.

 Teresa Barber: Jeff, I want to welcome you. Thank you for being our guest today on the IMS Insights Podcast.

Jeff Dahm: Great. Thanks for having me.

Barber: Tell us a little bit about your background. How did you first become interested in trial presentation?

Dahm: Well, I graduated from college in 1996 and I got a job. I went to the career center. There was no internet in ’96, so I got a job. I went to the career center, found a job at a jury consulting firm as a research analyst and I didn’t know really much about the law and I definitely hadn’t been in a courtroom at that point in my life but I went right in and I worked for a pretty prominent jury consultant setting up jury research projects around the country and it was really fascinating. It was new for me. I didn’t know anything about this and I knew it was for me. I mean I was always a very technical person. I was always setting up computers and helping people with their stuff and their computers and on the emerging edge of computers always but I didn’t really work in computers then.

Dahm: So, when I was working at this jury consulting firm, there was a woman who had her boyfriend was starting up a company that did trial presentation. Well, I didn’t know what trial presentation was, so she’s like, “I know you’d be great with him. Why don’t you go meet him?” So, I went to his office and met him and they hired me and then I started being … Working in trial presentation. So, it was … I made the shift from jury consulting. I mean I knew I liked trial consulting for sure. I knew it was a job for me, I just didn’t think that the jury consulting job was the right fit at that point in my career. So, I used all my technical skills and got this job and so what we did was we started doing trial presentation around the country and it was pretty new in the early 90s.

Dahm: In the mid-90s, it was really new. I mean there wasn’t a lot of trial presentation. It’s like I always had this desire to perform and to be on stage but I have no talent. I can’t sing and I can’t dance but I knew this was my performance. This was my way to be performing because I was really technical and I was really good at being technical and being good under pressure. So, when I started doing this, this satisfied my performance itch that I’ve always had and I loved it and it was just great and I knew that this was going to be my career.

Barber: I was going to say, it sounds like you walked right into the fire and at a really early stage and-

Dahm: I did.

Barber: That role, so there really wasn’t a whole lot of … In terms of best practices and models, you’ve really had to be there at the forefront for a lot of that.

Dahm: Yeah, it was really exciting. It was just … I graduated with a degree in environmental analysis and design and thought I was going to save the world and all of a sudden, I’m in this new career and I was like wow, this is exciting. Traveling the country, setting up courtrooms, working with attorneys. I mean I was 23 years old and this was truly exciting for me. I mean it was just … I was over the moon about this job, this new job I had.

Barber: So, kind of the nexus too of technology, which is a passion, right? And then like you said that so much on the line for presentation in the middle of a trial. What exactly … And I’m sure that it’s evolved too, right? Since the mid-90s, late 90s to today, what are the fundamentals? What does a trial … A hot seat consultant, a trial technician do?

Dahm: Sure. Well, as a basis that hasn’t changed in the 25 years I’ve been in the business, what hasn’t changed is that you’re putting on a show and you’re responsible for everything that the jury and the judge see and it’s a big, big responsibility but that’s your job and so your job is to organize the evidence in your trial presentation software and help the attorney put together the show that you’re going to put on in the courtroom. So, you’ve got to do run throughs, you practice the night before. You make sure you have all of your highlights ready. You make sure you have your deposition clips. It’s putting together any sort of evidence that you would ever need to show a jury and organizing it and being able to call it up really fast in the courtroom and that really hasn’t changed much over the 25 years. That’s the job.

Dahm: I mean sometimes you do less, clients want to do more. Sometimes you do a lot more. Sometimes you’re full throttle. Sometimes you just set it up for them and they go on their own, but it just depends. It’s just all-encompassing in trial for the evidence.

Barber: Very interesting. It sounds like there’s a lot that leads up to it, right? It’s not just showing up and-

Dahm: No.

Barber: You’re putting a presentation forward, how important is a focused strategy for trial presentation? Does that matter?

Dahm: Yeah. Oh sure. I mean every trial presentation consultant has their own sort of method of operation that they do. For me, it’s getting in with the client very early, making sure that they know that I’m here to help them and I’m going to take care of everything, being very organized with anything they give you that they request that you want, you reply back fast. You have to reply fast. You have to get the work done quick and you have to be very efficient and also, you have to be able to speak to attorneys very well. So, that’s the key is you have to be able to roll right into their world and be able to talk and work just as though you were one of them.

Dahm: So, you’re going to different attorneys all around and everybody has different work styles and so the key of a great trial presentation consultant is to be able to meld into the trial team that you’re working with and that is the most important thing. I now schedule a lot of trial techs for courtroom trials and what’s really important in a strategy is a culture fit, to make sure that this tech fits in with you, that you kind of click because I find that the clients that I do the best job for, I click with them. There’s just like a bond, kind of like something you can’t explain like when you meet someone, you click, if you click, then you’re great but I can also make myself click if I have to and that’s the differentiation in a great trial presentation consultant is you blend in, you make yourself blend in in order to let them trust you so that you can be effective in court.

Barber: I was going to say because there’s a lot of trust that gets put in you or in a trial consultant technician because there’s … Really, that attorney has to be able to say, okay, I know that this needs to appear at this point and you’ve got to be able to pick up those cues, so that’s really interesting to have.

Dahm: You have to be able to click, yeah there has to be trust, you’re right. You’re so right that trust is key. Your whole case, their whole case kind of depends on you, what comes up on the screen. So, when you meet these clients the first time, you have to come in there showing them that you can command the room, you can command a presentation and you can get the job done and those are the really key things that I look for in consultants too when we’re placing them with attorneys is they have to be forward. They have to be forward thinkers. They have to be proactive people because those are the ones that do the best in court.

Barber: Yeah. And I want to ask you too, because we’re here, Jeff, in the middle of summer 2020 and we are in a … Really, in a lot of ways, what’s an unprecedented time, a lot of concern everywhere for colleagues, for communities dealing with COVID-19. It’s also the pandemic, we have a global pandemic, placed an unprecedented amount of stress on the court system and we’ve even seen remote trials popping up. First, it was remote hearings, lately remote trials in some places like throughout California. Can you talk to me a little bit about what you’ve been seeing from clients, what you’ve been hearing from the ground and how important it might be for a dedicated trial presentation consultant or someone with that expertise when you’re thinking about what that completely visual and virtual setting … Can you talk to me about what you’re hearing?

Dahm: Yeah, so as I’m sure everybody has realized in the past few months being at home is that most people are not fully comfortable with the scenario of talking to people over a video conference. It’s not natural. It could be exhausting. There’s a lot of other layers that people don’t realize that come with that. As a consultant working around the country, I have been and trial presentation consultants have been working in video conferences, working at this method for years now and this is a very comfortable place for us to be. This is … And also, when you are presenting, because … Okay, so courtrooms that … Most courtrooms are now pushing towards having Zoom hearings, having Skype hearings. This is a really, really common thing that’s happening more and more and I tell you, if a courtroom is not doing it now, they’re going to be doing it soon.

Dahm: This is the way of the immediate future for the next few years and you need to be prepared and when you’re giving an argument, just like in court, there’s a lot of things to think about beyond your argument and you should let a consultant handle that for you. Let your trial presentation consultant run your PowerPoint. You have to let them help and we can display in a video conference the same as we can in court. You can put things up. You can share the screen and this is something that trial techs and trial presentation consultations are good at, manipulating multiple different views for things to go on the screen, coordinating with people and tech. I mean this is our wheelhouse. So, you are doing yourself a huge favor by having the trial presentation consultant on a call for you in a hearing. I mean it’s invaluable as far as I can see.

Barber: Yeah, I was going to ask you, so it sounds like some of the same principles that you apply in trial presentation in a physical courtroom, how, can you talk to us about how you apply those fundamentals and those principles to help clients prepare and move cases along right now?

Dahm: Sure. Well, and I’ve heard this from my clients too, the cases are not going away. Even though, the public … The in-person hearings are not happening, the cases aren’t going away. They’re still moving forward. You’re still going to have to go forward with your discovery. You have to … Your expert witness disclosures, I mean everything is still happening. So, it’s important that you use your trial consultants as you always would to help move your case forward. Send them your video if you have video depositions that need to be prepared. It still has to happen. Let’s say you have to submit your video deposition designations for your trial that’s in July, that still has to happen. These consultants, and we’re ready to go, we are ready to help you just like we always are when you got to be in court. We are just as ready to help you with your online hearing. I mean it’s just as important, so you should treat it that way.

Barber: And we’re seeing … We’re kind of touching on this, you mentioned like just a lot of hearings moving to Zoom or Skype and if we’re not seeing that now, brace for it because it’s coming. So, what tools and resources would you recommend right now for litigators or attorneys just preparing for a virtual in-court scenario, maybe don’t have one scheduled yet but want to be prepared?

Dahm: So, we are all doing our homework here on the presentation side. I know all the trial techs that we work with and also everybody at my firm, other consultants in general, we’re all doing our homework and we’re all making sure that you all can … That the attorneys can do all of their hearings online. I know that we’ve done a lot of Zoom hearings so far. I know that some consultants are creating a virtual courtroom scenario in order to have everybody log in. I mean there’s just … There’s really a lot of work been going on, on the consultant side to make it easier for clients when they do have the hearings. So, reach out to your consultants because they want to help you and they also know what’s happening. They know. They have their pulse on the industry, especially this ever-changing industry as we speak. So, they want to help you and they’re very, very eager to help. Trust me, I’m one of them.

Barber: Jeff, could you … Are you seeing anything about how you think that the pandemic is potentially affecting software that’s used in the firm and the platforms in the industry?

Dahm: Definitely, sure. So, trial presentation software has evolved over the years, but I feel like this is going to cause it to evolve even more. I mean I’ve been testing a lot of software, all of our software that we do use in court to see that it works on a Zoom hearing and it does but I feel like now, the trial presentation software, they’re going to start to create another layer in their software for online hearings because to make sure it’s not buggy because you are still doing a presentation over the internet through another platform and I would think that these trial presentation software companies are going to align with Zoom and create a software to present with Zoom. I mean these are things that I can see coming down the pipe that will be really exciting. I feel like this, as we know, necessity is the mother of invention and this is going to force companies that make trial presentation software to incorporate the video conferencing aspect to it to make it a little easier for us trial presentation consultants.

Dahm: I mean we can do it now. I can display a PowerPoint. I can click through. I mean I’m quite fluid with it on a video call because I do it all the time. I can click through OnCue. I’ve had a couple of Markman so far online that I was able to click through my documents, go back in my PowerPoint. It’s very fluid. However, I see there’s a couple of points that could be better and I know in the next six months, you’re going to start seeing PowerPoint coming out with online things in integrating into their online applications, same with OnCue, Trial Director, pretty much all these things that we use in court, they’re going to have to start talking to Zoom because I know they’re going to want to make it easier for everybody, which is great. So, it’s just really great but us consultants are on that pulse, so if anybody gives me a call, I can tell you what’s going on.

Barber: Hold on, I want to ask you, you raised that suggestion, thinking about the other hot seat operators, the industry, a lot of independent contractors that maybe don’t work with a firm like IMS or The Focal Point, what advice do you have for other folks in the industry right now with so many courts closed?

Dahm: Yeah, so you have to pivot your skills. I mean as a trial presentation consultant, you understand that you have certain skills. You can work under pressure. You can work technically under pressure. You can display evidence fast. I mean these are all things that are going to be needed to do in a video conference hearing too. Assisting in these online hearings is going to be crucial. I mean I think that since this is the beginning of this online hearing generation, clients are going to be slow to react at first, just like in general with the trial presentation consultant.

Dahm: You’re slow to bring people on and then once you have your first hearing and you realize that your PowerPoint is not displayed effectively, then you’re going to give us a call. So, also, a lot of independent trial presentation consultants can record online depositions. That’s a thing that I’ve seen a lot of trial techs that are getting into right now is to assist clients in online depositions. So that’s been a big thing for a couple of my consultants I work with too.

© Copyright 2002-2020 IMS ExpertServices, All Rights Reserved.

How Lawyers and Other Professionals Can Set Up Their Work-From-Home Space During COVID-19

Since the federal government’s mandated social distancing orders due to covid-19, working from home has presented new challenges for professionals at law, real estate and financial firms alike. Below are four tips on how you can get acclimated in your redefined workplace.

  1. Set Boundaries – One of the benefits of working from home is the ability to take advantage of the extra time on your hands since the work commute has vanished. However, it can be tempting to work from the most comfortable place in your home – your bed. Studies have found that working from your bed decreases productivity levels and makes it difficult to fall asleep at night because your brain associates your bed with work and stress. It is important to set boundaries between your workspace and your place of relaxation. Try setting up your space in a separate room such as the living room or guest room; in a smaller or studio apartment, you can set up a divider wall to establish designated spaces for work and play.
  2. Lights, Camera, Action! – Having your workspace near a window where natural lighting can seep through is an energy booster and stress reliever. According to medical professionals, the rays from the sun improve the communication between the regions of the temporal lobe which control emotions such as anxiety and stress. Sunlight also produces endorphins and serotonin hormones – “happy” hormones – that enhance our moods throughout the day.
  3. Minimize Distractions – While this is a challenge if your home has turned into a school and entertainment center, there are ways to avoid daily distractions. One example is limiting cell phone usage by using the “Screen Time’s Downtime” feature available on all Apple iPhone devices and many Android devices. Try setting it up during your work hours to avoid spending unnecessary time on social media. Wall calendars, daily to-do lists and designated browsers for personal and business activities can also keep your mind focused throughout the day. If you live with loved ones and/or roommates, establish “quiet hours” so everyone is on board and aware of your allocated time to focus.
  4. Create a Routine – When adapting to this new reality, creating a routine is key to maintaining your mental wellness and productivity. Shower at the same time you normally would, wear what you would normally wear to the office (although loungewear may be tempting!) and prepare your preferred type of coffee, tea or infused water to start your day. Most notably, make sure you go outside and remain active to improve blood circulation to the brain. When it’s time to return to business as usual, you won’t feel sluggish and your mind will feel ready more than ever to tackle the day.

© 2020 Berbay Marketing & Public Relations

For more on working from home, see the National Law Review Law Office Management section.

A Virtual Discussion Series | Part I: Labor, Employment and OSHA Developments and Strategies for Companies and PE Investors Navigating COVID-19 Hurdles

In this webinar, Partners in the Private Equity/Mergers and Acquisitions Practice Group, Heather Rahilly and Andrew Ritter, moderate a discussion with Partners in the Labor, Employment and OSHA Practice Group, Michael Miller and Lawrence Peikes, to discuss developments and strategies in labor, employment and OSHA for companies and investors navigating COVID-19 hurdles.

Key takeaways from this webinar include:

  • New developments and trends in labor and employment laws
  • Summary of current changes to OSHA regulations and standards
  • New litigation and regulatory concerns and how to mitigate risk
  • How legal developments in OSHA, labor and employment may affect current and future deal practice

© 1998-2020 Wiggin and Dana LLP

For more on OSHA labor regulation, see the National Law Review Labor & Employment law section.

EEOC: What You Should Know About COVID-19 and the ADA, the Rehabilitation Act, and Other EEO Laws

The U.S. Equal Employment Opportunity Commission (EEOC), the federal agency responsible for enforcing federal anti-discrimination laws, today updated its Technical Assistance Questions and Answers, “What You Should Know About COVID-19 and the ADA, the Rehabilitation Act, and Other EEO Laws.” This Technical Assistance is intended to help employers address practical issues that may arise in their day-to-day operations and oversight of their employees as they return to work in the context of COVID-19. The EEOC has consistently reminded employers that the federal anti-discrimination laws continue to apply during the pandemic and that these laws do not interfere with the guidance issued by public health authorities, including the CDC.

What You Should Know About COVID-19 and the ADA, the Rehabilitation Act, and Other EEO Laws

The EEOC’s previously issued Technical Assistance discussed critical issues such as disability-related inquiries and medical examinations, confidentiality of medical information, and hiring and onboarding during the COVID-19 pandemic. In addition, the EEOC provided detailed guidance on handling reasonable accommodations during the pandemic. In this newly issued Technical Assistance, the EEOC focuses in even further on these and related issues, and provides an analysis of common topics that many employers have been or will be facing as employees are preparing to return to work.

The updated questions and answers include topics such as: whether an employee is entitled to an accommodation under the ADA to avoid exposing a family member who is at higher risk of severe illness from COVID-19; whether reasonable accommodations are required during the process of screening employees before they enter the worksite; whether employees age 65 or older, who are at higher risk of severe illness from COVID-19, can be involuntarily excluded from the workplace based on their age; whether pregnant employees can be involuntarily excluded from the workplace due to their pregnancy and, relatedly, whether there is a right to accommodation based on pregnancy during the pandemic. In addition, the updated Technical Assistance discusses steps employers can take to prevent and address possible harassment and discrimination that may arise related to the pandemic, particularly as against employees who are or perceived to be Asian.

EEOC Technical Assistance Questions and Answers

Employers should review this newly issued Technical Assistance from the EEOC so that they are prepared to address these issues if they arise as businesses are re-opening and employees are returning to the workplace.

©2020 Norris McLaughlin P.A., All Rights Reserved

For more on EEOC COVID-19 guidance, see the National Law Review Labor & Employment law section.

The Federal Government Is Taking Action Against COVID-19 Fraud

The federal government has responded to the coronavirus (“COVID-19”) pandemic with legislation to aid individuals and struggling businesses. One of the many laws created was the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”), a $2 trillion federal appropriation addressing the economic fallout caused by COVID-19. Many are rightfully concerned about individuals aiming to take advantage of the vulnerability, panic, and available federal dollars during this time. In response, the federal government has vowed to aggressively take action against COVID-19 related fraud.

Fraud Committed Against Individuals

The Department of Justice (“DOJ”) announced its first enforcement action against COVID-19 fraud in March 2020. A website, coronavirusmedicalkit.com, was offering access to World Health Organization (“WHO”) vaccine kits for a shipping cost of $4.95. However, no vaccine currently exists nor is a vaccine currently being distributed by the WHO. Once alerted of the website’s existence, U.S. District Judge, Robert Pitman immediately issued an injunction preventing any further public access to the site. The site operators are currently facing federal prosecution.

Fraud Committed Against the Federal Government

Opportunists are not only acting to deceive the public but are also acting to defraud the federal government. Recently, Samuel Yates, a Texas native attempted to defraud $5 million in federal funds. The Small Business Association (“SBA”) is providing loans to businesses through a Paycheck Protection Program (“PPP”). The PPP allows employers to continue paying their employees during the pandemic. Yates applied for two loans. In one loan application, he sought $5 million claiming to have 400 employees with a $2 million monthly payroll expense. In another application, he claimed to have only 100 employees. Each application was submitted with a falsified list of employees created by an online name generator, and forged tax records. Yates was able to obtain $500,000 in loan proceeds before his scheme was uncovered. He is currently facing federal prosecution for bank fraud, wire fraud, false statements to a financial institution, and false statements to the SBA.

Christopher Parris, a Georgia resident, also attempted to defraud the federal government by selling millions of non-existent respirator masks. Unlike Yates, Parris was able to make millions on sales orders by misrepresenting himself as a supplier who could quickly obtain scarce protective equipment. His plan was uncovered just a few weeks ago after attempting to sell masks to the Department of Veteran Affairs (“VA”). The VA became suspicious of the price—which was about 15 times what it was paying amid the shortage, and alerted their Inspector General who brought in Homeland Security. Over $3.2 million was seized from Parris’ bank account related to this scheme, and he is currently facing federal prosecution for wire fraud.

Although enforcement action has been taken against individuals, companies should take note that fraud is being prioritized and aggressively prosecuted against businesses as well. Just last month, the Securities & Exchange Commission (“SEC”) charged two companies with issuing misleading claims to the public. The first represented that it could slow the transmission of COVID-19 through thermal scanning equipment that could quickly detect individuals with fevers and would be immediately released in each state. The other offered a finger-prick test kit that could be used from home to detect whether someone was COVID-19 positive. Both claims were untrue and each company is facing federal charges for violating the antifraud provisions of the federal securities laws.

These federal efforts mark the beginning of a shift, holding both individuals and companies accountable for COVID-19 related fraud. The Department of Homeland Security has noted that those taking advantage during this vulnerable time will inevitably increase. Inter-agency efforts, swift enforcement, and emerging legislation will likely follow in an effort to protect the public against all levels of COVID-19 related fraud. As they have during previous economic crises, whistleblowers will play a critical role in aiding these enforcement efforts.

Katz, Marshall & Banks, LLP

For more on COVID-19 related fraud, see the National Law Review Coronavirus News section.

A Word About Business Interruption Claims From Vandalism, Riot and Civil Commotion

The death of George Floyd is a national tragedy that should never have happened.  The winds of change are in the air and we can only hope that peace, understanding, justice and fairness for all will prevail.  What happened to George Floyd and the cries to end racial injustice, however, have been overshadowed in the eyes of many by the vandalism, looting and rioting that followed.  That brings us to insurance.

There have been many articles discussing whether and how the business losses arising from the vandalism and looting will be covered under insurance policies.  Because these losses took place during the novel coronavirus pandemic, the insurance coverage issues have become more complex.  This is particularly true for business interruption claims.

There are three issues that I thought were worth highlighting.  The first concerns the confluence of the existing COVID-19 stay-home orders and the vandalism and looting.  The second is the necessary nexus between direct physical damage and civil orders under coverage for civil authority.  Finally, the effect of anti-concurrent cause clauses in property policies.

First, some of the business interruption claims now being brought by businesses that had to shut down because of the protests or because of the curfew orders have been complicated by overlapping civil authority stay-home orders because of the novel coronavirus.  Where a business was closed because of COVID-19 stay-home orders or was open only to provide curbside pickup or delivery services, how is its loss of income and extra expense calculated if the business had to close because of the civil unrest?  Analyzing this issue requires much more space than this blog post can provide.  It is a complicated issue that depends on exactly what coverage is provided and how loss of income is calculated under the relevant business interruption coverage grant.

Just as an example, under a common business income and extra expense coverage form, the amount of business income loss is determined based upon the net income of the business “before the direct physical loss or damage occurred,” the likely net income of the business “if no physical loss or damage has occurred . . . ” and “the operating expenses, including payroll expenses, necessary to resume operations with the same quality of service that existed just before the direct physical loss or damage.”  When applied to the recent vandalism and looting business interruption losses, the net income before the vandalism and looting may have been much less than in months or years past because of the COVID-19 stay-home orders.  If no vandalism and looting had occurred, the likely net income would have been the same as under the existing COVID-19 stay-home orders; that is to say, most likely diminished from prior periods.  Yet some are pushing for the COVID-19 effect not to be considered at all in the calculation of net income in the context of business interruption losses due to vandalism and looting.

Second, civil orders that prevented ingress and egress to and from businesses because of the threat of violence from possible protests likely will not be sufficient to trigger coverage under business interruption civil order provisions.  The common form requires a nexus between direct physical damage and the civil order.  For example, the action of civil authority must be “taken in response to dangerous physical conditions resulting from the damage or continuation of the Covered Cause of Loss that caused the damage. . . .”  If a local government shuts down a business district in advance of a protest and before there is any physical damage to property, that civil order should not trigger coverage under the business interruption coverage grant.  A civil order that shuts down a business district after vandalism because the area is dangerous likely would result in some coverage under the business interruption coverage grant depending on other policy factors.

Finally, some property policies limit coverage to covered causes of loss and preclude coverage if the loss was caused in part by a non-covered cause of loss.  For example,

We will not pay for loss or damage caused directly by any of the following. Such loss or damage is excluded regardless of any other cause of event that contributes concurrently or in any sequence to the loss.  These exclusions apply whether or not the loss event results in widespread damage or affects a substantial area.

If an insurance policy excludes a cause like looting, but covers vandalism, even if the loss was caused in part by looting, the anti-concurrent causation clause would preclude coverage.  So too, if part of the loss claimed was caused by the novel coronavirus and the policy has a virus exclusion, that would preclude the loss even if part of it was caused by vandalism.

As always, it is most important to read the complete policy because not all insurance policies are the same.  Nevertheless, there is no doubt that business interruption losses arising from the recent civil unrest have been complicated by existing governmental orders covering the novel coronavirus.  It will take patience by all parties and careful analysis to work through these claims.

© Copyright 2020 Squire Patton Boggs (US) LLP

For more on business interruption claims, see the National Law Review Insurance, Reinsurance and Surety law section.

President Trump Orders Expanded Use of Emergency Powers to Streamline Infrastructure

On Thursday, June 4, 2020, President Trump signed an Executive Order (EO) on “Accelerating the Nation’s Economic Recovery from the COVID-19 Emergency by Expediting Infrastructure Investments and Other Activities.” Relying on the COVID-19 declared national emergency, the EO directs federal agencies to invoke their existing emergency authorities under the National Environmental Policy Act (NEPA), Endangered Species Act (ESA), Clean Water Act (CWA), and other laws to expedite economic recovery, including taking “all reasonable measures” to speed infrastructure and public works projects. While consistent with prior administrative directives to expedite project permitting, this latest EO likely will have little practical effect on individual projects and generate increased litigation for projects that rely on it.

The EO aspires to expedite a variety of projects that fall under the jurisdiction of several specific federal agencies:

  • All authorized and appropriated highway and other infrastructure projects within the authority of the U.S. Department of Transportation;
  • All authorized and appropriated civil works projects under the purview of the U.S. Army Corps of Engineers; and
  • All authorized and appropriated infrastructure, energy, environmental, and natural resources projects on federal lands managed by the Department of Defense, the Department of the Interior, and the Department of Agriculture.

The EO’s main action item is periodic reporting by affected federal agencies to the White House. Agency heads must provide a summary report listing all projects expedited under their emergency authorities no later than July 4th (30 days after the EO’s issuance date), and provide status reports every 30 days thereafter. The EO specifies no end date for the national emergency or use of emergency authorities.

The EO principally relies on the government-wide NEPA regulation for emergency situations.  40 C.F.R. § 1506.11. It also invokes the ESA implementing regulation on Section 7 consultations in emergencies (50 C.F.R. § 402.05 2) and the CWA Section 404 regulations and nationwide permits addressing emergency circumstances. Lastly, the EO directs agencies to review “other authorities” potentially applicable to emergencies, including “all statutes, regulations, and guidance documents that may provide for emergency or expedited treatment (including waivers, exemptions, or other streamlining).”  Overall, the EO intends to allow critical infrastructure and public works projects to move forward more quickly, by abbreviating or waiving legally required environmental reviews, interagency consultation, and public comment.

While the goals of reducing time and paperwork are laudable, the EO will likely be less impactful than other recent efforts (such as One Federal Decision). The emergency exemptions available under NEPA, the ESA, the CWA, and other laws are quite limited pursuant to regulations and case law. They are meant for very narrow or discrete circumstances, not for indefinite national conditions. Moreover, they do not entirely or permanently waive environmental requirements, but rather allow for deferred or alternative procedures that achieve statutory aims. For example, the NEPA emergency regulation provides that when emergency circumstances make it necessary to take actions with significant environmental impacts without observing the typical NEPA process, agencies may consult with the Council on Environmental Quality to make “alternative arrangements” to take such actions. The effort and resources required to develop such “alternative arrangements” may not save time in the overall NEPA review. Nor can an EO legally displace regulations or case law.

Predictably, environmental organizations have already indicated a likely forthcoming challenge to the EO. Though a direct challenge may face jurisdictional obstacles, individual project approvals relying on the EO may be more vulnerable to lawsuits. And given the EO’s focus on timing, preliminary injunction motions at the commencement of lawsuits likely would be a centerpiece of those lawsuits, which likely would offset any advantage that may have been gained from relying on the EO.

© 2020 Beveridge & Diamond PC

Beware the COVID-19 Cure: The FTC Issues Warnings to Products Making COVID-19 Treatment Claims

With no approved vaccine, the world waits for the next big breakthrough in 2020’s medical emergency. Some companies already claim to have found it – and subsequently received warning letters from the Federal Trade Commission (FTC) for misbranding. The FTC is targeting companies promoting products with supposed COVID-19 cures, treatment or prevention for making illegal, unsubstantiated claims.

One of the FTC’s objectives is eliminating false and misleading information from the marketplace. The FTC Act defines false advertising as misleading in a “material respect,” which includes both affirmative statements and failure to “reveal facts material in the light of [the product’s] representations[.]” See 15 USC 55(a)(1).

The FTC accomplishes its goal by sending warning letters. Under the FTC Act, a product may be misbranded if it is promoted as a prevention, cure or treatment for COVID-19 – when in fact it has not been approved for such use by the Food and Drug Administration. Since March 2020, the FTC has issued more than 200 warning letters to various businesses that advertise wellness products and other services that allegedly address COVID-19.

In some instances, the claims involved a gross exaggeration of the product’s effectiveness. For example, the website “NothingsIncurable.com” advertised products alleged to “literally make you invulnerable.” The FTC concluded those claims constituted misbranding. But even when promotional statements do not include an explicit falsehood, overpromotion still can cross into misbranding. For example, businesses that claimed, “[this product] will target and increase your immunity to help ward off the COVID-19 virus” or that recommended their products as “scientifically proven to support healthy immune function” also were found to be misbranded.

In another example, a company included “Coronavirus” in the website navigation menu that led consumers to therapy kits intended to provide “specific nutrition” to “balance the terrain of the body to make it conducive to” its particular function. Although the product description did not reference COVID-19, the FTC concluded that the website navigation menu was suggestive enough to warrant a warning for misbranding.

Summary

The FTC warning letters advise businesses that “under the FTC Act, 15 U.S.C. § 41 et seq.,” they are prohibited from advertising “that a product or service can prevent, treat, or cure human disease unless you possess competent and reliable scientific evidence, including, when appropriate, well-controlled human clinical studies, substantiating that the claims are true at the time they are made.” In addition, products that claim or imply the ability to mitigate, prevent, treat, diagnose or cure COVID-19 must be approved drugs under section 505(a) of the Federal Food, Drug and Cosmetic Act. In each case, the FTC required a response from the business within 48 hours, detailing the actions taken to address the FTC’s concerns.

During this unprecedented health crisis, companies that sell consumer products should exercise caution when mentioning COVID-19 in advertising or promotional statements. Mentioning COVID-19 in relation to a product, even if the product is intended to address more routine health issues, could be misleading.

© 2020 Faegre Drinker Biddle & Reath LLP. All Rights Reserved.

For more on COVID-19, see the National Law Review Coronavirus News section.

HHS Laboratory Data Reporting Guidance for COVID-19 Testing

On June 4, 2020, the U.S. Department of Health and Human Services (HHS) issued new Laboratory Data Reporting Guidance for COVID-19 Testing (Guidance) and related Frequently Asked Questions. Under the Guidance, in addition to providing the results of COVID-19 testing, laboratories will be required to report demographic information, including the patient’s age, race, ethnicity, sex, residence zip code, and county. The Guidance further recommends reporting the patient’s name, street address, date of birth, ordering provider address, and ordering provider phone number to state and/or local public health departments, although this data would not be collected by the Centers for Disease Control and Prevention (CDC) or HHS. Data for each test completed must be submitted within 24 hours of the results being known or determined, providing public health officials with “nearly real-time data.

Reporting is required for both diagnostic and serologic testing, and the Guidance specifically includes laboratory testing that relies on home-based sample collection. Laboratories, defined to include “laboratories, non-laboratory testing locations, and other facilities or locations offering point-of-care testing or in-home testing related to SARS-CoV-2,” must comply with the new requirements by Aug. 1, 2020. The Guidance specifies that reporting should be made through existing channels to state or local public health departments that will, in turn, submit de-identified data to the CDC.

According to HHS, “[t]he new reporting requirements will provide information needed to better monitor disease incidence and trends by initiating epidemiologic case investigations, assisting with contact tracing, assessing availability and use of testing resources, and anticipating potential supply chain issues.” HHS also indicated that the requirements may help officials understand and address disproportionate impacts of COVID-19 on certain demographic groups and ensure equitable access to testing.

Although this reporting requirement is being imposed by HHS, it is unclear what impact the new data may have at a national level. Under HHS’s COVID-19 Strategic Testing Plan issued on May 24, 2020, states are largely responsible for developing and implementing their own COVID-19 testing strategies.

©2020 Greenberg Traurig, LLP. All rights reserved.

For more on COVID-19 testing, see the National Law Review Coronavirus News section.