By Jamie Huffman Jones
COVID-19 is impacting all sectors of the world, including that of civil litigation. In Arkansas, the federal and state court systems have issued blanket orders that continued civil trial settings, cancelled in-person hearings, and mandated that depositions be conducted in a way to minimize exposure to the virus. What does this mean for litigation in Arkansas now and what might it mean for future litigation?
The Current State of Litigation
State Appellate Court - The Arkansas Supreme Court per curium order dated March 20, 2020 now gives the Clerk of the Court for the appellate courts authority to grant “reasonable” requests for an extension. Oral arguments before the Court of Appeals and the Supreme Court were cancelled by the March 17, 2020 per curium order.
Trials - There will be no jury trials until at least April 17, 2020 according to the most recent orders. Trials continued during this time will ostensibly be rescheduled after trials already on the books.
Hearings - The Arkansas Supreme Court cancelled all in-person hearings, unless there is an emergent situation, until April 17. Criminal and domestic hearings are continuing in certain cases. Where there is an exigent circumstance or good faith reason for a hearing, it is possible that a telephone hearing could be arranged. Contact your attorney to discuss the specific issue and see if a remote hearing is a possibility.
Orders - The courts continue to issue routine orders, and it is anticipated to continue.
Pleadings/filings - Filing deadlines have not been extended by the orders. All of the Federal Courts, and the majority of the Arkansas Circuit Courts, conduct filings via electronic systems. Thus, filings should continue as usual so long as the staff at the various court clerk offices are available to approve and post filings through the system. To date, we have not seen an impact in the ability to file pleadings. However, certain aspects of serving pleadings, such as a complaint, may be impacted where the to-be-served party is not in the normal location.
Depositions - The Federal and the Arkansas Supreme Court Orders mandate that any in-person proceedings, including depositions, be conducted in a way to minimize exposure. Corporate clients and some law firms have also issued policies prohibiting the taking of in-person depositions. Court reporting firms have also added distancing requirements. A complicating factor is that multiple deposition locations, in particular for depositions occurring outside the state, have closed due to sequester-in-place orders. However, if the parties can be creative and agreeable, technology allows for remote depositions whereby no person has to be in the same room as another. Strategic considerations will go into the decision as to hold a remote deposition, rather than allow the attorney to sit across from the witness for questioning. In some cases, it might make best strategic sense to wait until the impact of COVID-19 has lessened and in-person depositions resume. Speak with your lawyer about what makes the best sense for your case.
How might COVID-19 spawn future litigation?
While Arkansas has not yet seen any COVID-19 specific litigation, there are indications that COVID-19 will create its own category of litigation.
Securities litigation and director liability - On March 12, 2020, a class action complaint alleging violation of federal securities laws was filed in the Southern District of Florida against Norwegian Cruise Lines. Essentially, the allegation is that Plaintiff purchased Norwegian Cruise Lines securities at an inflated price as a result of Defendants’ alleged false and misleading statements about the state of the cruise line and industry during the early days of COVID-19. You can read the complaint here.
Event cancellation - World-wide events like the Olympics, and national events like March Madness, baseball, and basketball are cancelling. Local events are also cancelling, prompting many to lose revenue and out-of-pocket expenses. Often a specialized policy is required and fear of the virus in the community may not be enough to trigger coverage. In such cases, clients should review, or send to its attorneys, the policies to determine if event cancellation is covered as the specific policy language will govern.
General liability - On March 9, 2020, a South Florida couple sued Princes Cruise Lines after being quarantined off the coast of San Francisco on the cruise ship as a result of the COVID-19 outbreak alleging negligence and gross negligence for an alleged failure to warn of the risk of exposure and alleged failure to take reasonable precautions against the virus. You can read the complaint here. While it is anticipated that similar lawsuits will follow, it will be particularly complicated to prove proximate causation (that is, is that the defendants’ conduct, in a natural and continuous sequence, produced damage and without which the damage would not have occurred) and foreseeability regarding such damage.
Business interruption and civil authority - When an event shuts down the business, businesses generally look to see if its insurance policies cover the business interruption loss (which may result from having to shut down suddenly) or a contingent business interruption (which may result from the closure of the supply chain). A business interruption clause is intended to provide coverage where a direct physical loss results in a loss of business income to the insured. Somewhat similar is the civil authority clause, which is intended to provide coverage where a civil authority has rendered a business inaccessible due to a physical damage nearby (sometimes, neighboring is required). Generally, both require direct physical damage to be triggered. Again, in such cases, clients should review, or send to its attorneys, the policies to determine if event cancellation is covered as the specific policy language will govern and the individual facts surrounding the interruption.
For a discussion of how businesses should plan and prepare for COVID-19 related legal issues, read our article “Businesses Should Plan and Prepare.”
For a discussion of how COVID-19 product shortages impact manufacturers of products, read “Product Shortages and Legal Pitfalls.”
Regardless of the impact of COVID19, Friday Eldredge and Clark, LLP remains committed to serving its clients. Our lawyers are available to you. We encourage you to contact your Friday Firm attorney to discuss any questions or concerns that you have regarding the impact of COVID19 on your particular litigation.
Jamie Huffman Jones is a partner in the Litigation Practice Group and advocates for clients in jury and bench trials involving a variety of claims, including mass tort, catastrophic injury, wrongful death, business and commercial disputes, class actions, and automotive commercial disputes.
Disclaimer: The information included here is provided for general informational purposes only and should not be a substitute for legal advice nor is it intended to be a substitute for legal counsel. For more information or if you have further questions, please contact one of our Attorneys.