The Chamber says it is trying to pre-empt what it believes will be a coming wave of coronavirus-related lawsuits.
“What we’re concerned about, and advocating for with Congress, is you don’t want to wait until all the cases are filed … you have to deal with this beforehand,” said Matthew Webb, senior vice president for legal reform policy at the Chamber, in a teleconference that was recorded and uploaded on June 1 to YouTube on the account of a Texas Chamber of Commerce.
Webb’s comments offer a rare glimpse at the integral role being played by lobbyists as Congress looks for ways to address the economic crisis. In the weeks after the pandemic took hold, lobbying groups representing a diverse array of clients including doctors, entertainment venues, riverboat operators and others sent unsolicited draft legislation to top Republicans, according to lobbyists and a congressional aide. The Chamber, through a working group it convened, has played a leading role.
The Chamber wrote draft legislation that set a high bar for coronavirus lawsuits and ensured that the Chamber-proposed language would take precedence over plaintiff-friendly state laws, Webb said in the YouTube video. And it capitalized on long-standing relationships with top Republicans as it worked to get its priorities written into law.
Webb said the Chamber worked “very closely” with Senate Majority Leader Mitch McConnell (R-Ky.) and Senator John Cornyn (R-Tx.) on “what [liability] reforms might look like in their package.” He predicted Republican lawmakers would rely heavily on the draft legislation given to them.
“They’re putting their touches on it as well, which I don’t expect to be anything that would be of concern from the U.S. Chamber’s perspective,” Webb said of McConnell and Cornyn’s contributions to the legislation they proposed.
Drew Brandewie, a spokesman for Cornyn, said his office distributed a first draft of its own May 6 and started working on coronavirus liability issues “two months before the Chamber claims to have written our bill.” Brandewie also listed several business-friendly provisions of the Safe to Work Act that weren’t in the Chamber’s draft.
In response to a request for comment on Webb’s statements, Chamber of Commerce Institute for Legal Reform president Harold Kim said the Chamber is focused on ensuring that the economic recovery isn’t “overtaken by opportunistic lawsuits.”
“Just like every other advocacy organization, we publicly identified major areas of litigation risk and offered solutions to policymakers that were timely, targeted, and temporary,” Kim wrote in an emailed statement.
Webb did not respond to an emailed request for comment.
The issue has become a sticking point in stalled negotiations over a new federal relief package. Senate Republicans have said they will refuse to negotiate over coronavirus liability protections, and will not agree to any deal that doesn’t include them.
“[T]ying kids, jobs, and healthcare all together, Senator Cornyn has authored strong legal liability protections so that nurses, doctors, charities, school districts, colleges, and employers can spend their next months actually reopening rather than fighting for their lives against frivolous lawsuits,” McConnell said in a statement. Asked for comment on the Chamber’s influence over the process, a McConnell spokesman referred to the Senator’s earlier statement on liability.
But the White House – which has occasionally defied the business lobby on issues such as trade and immigration – has wavered on the issue, at one point expressing openness to cutting a deal with Democrats. Most recently, Treasury Secretary Steven Mnuchin said his office agrees with McConnell on the need for a liability shield. No deal has yet materialized.
Speaking weeks before the Republican-sponsored bill was introduced, Webb went on to describe a detailed set of policy proposals eventually included in the Republican-sponsored legislation. They include imposing a higher standard of evidence than exists for most civil lawsuits, requiring the plaintiff to prove claims based on “clear and convincing evidence.” And both bills are constructed so that state laws will take precedence when they restrict liability even more than the national one.
But businesses that are proven to have acted recklessly can still be penalized for gross negligence under both the Republican-sponsored bill and the draft legislation shared by the Chamber of Commerce. That term usually refers to intentional or knowing disregard, something that can be difficult to prove.
“If you’re trying to make a good faith effort to do the right thing, you would receive liability protections,” Webb said. “If however, someone is engaging in egregious misconduct, they wouldn’t necessarily receive that liability safe harbor.”
The Chamber’s ability to insert its priorities into coronavirus legislation is a mark of its longstanding influence. It is common for members of both parties to lean on industry for suggestions and, in some cases, the specific text of important legislation.
But the close relationship the Chamber has with congressional Republicans is unparalleled in many ways. The lobbying organization is the highest-spending lobbying group on Capitol Hill: it spent $881 million on lobbying over the past decade, according to data compiled by the Center for Responsive Politics. That was more than the next two biggest spenders, the National Association of Realtors and Blue Cross Blue Shield, combined.
The Chamber of Commerce, through its employees, members and affiliated political action groups, has given over $31,000 to Sen. McConnell’s current re-election campaign, more than any other candidate this year and the most the group has given in recent years to a single candidate not running for president, according to CRP data. The Chamber and its affiliates have contributed tens of thousands of dollars to Republicans in Congress this year, including $10,000 to Cornyn’s campaign.
Many staff members of the Chamber previously spent years working for Republicans on Capitol Hill, and it has kept an open door especially for departing McConnell staffers.
Steven Law, a long-time aide to McConnell, served as chief legal officer and general counsel at the Chamber before taking over leadership of the conservative SuperPAC American Crossroads. John Abegg, a former chief counsel for McConnell, became executive vice president of the group’s Institute for Legal Reform last year.
The Institute for Legal Reform, a separately incorporated affiliate of the Chamber whose activities in a typical year include advocacy around esoteric liability issues and maintaining a blog called The Faces of Legal Abuse, has worked for decades to limit legal liability for businesses. A few months before the last turn of the century, the Chamber helped push through a bill that protected companies from lawsuits brought on by any malfunction of computer products as a result of the feared “Y2K bug.” Several provisions in the coronavirus liability bill were actually borrowed from the earlier Y2K bill, a Republican aide said.
“They never waste a crisis to push their agenda,” said Remington Gregg, a lawyer with the consumer watchdog nonprofit Public Citizen, which opposed the liability protection laws.
The Chamber of Commerce did not comment on Gregg’s statement, but has previously emphasized that liability protections should be temporary.
More recently, the Chamber has supported so-called forced arbitration agreements, which large companies use to head off class-action lawsuits from consumers and employees.
“This is a long-term campaign to eliminate the rights of consumers to have lawyers defend them,” said Ed Mierzwinski, senior director at the consumer watchdog group U.S. PIRG. “They are using the pandemic as cover for something they have been seeking.”
The Chamber faces opposition in congress from Democrats and from groups aligned with trial lawyers, who say the Republican-sponsored bill is a radical and unnecessary restriction of plaintiffs rights.
“Giving corporations immunity when they cut corners on health and safety is exactly the wrong approach to stop this pandemic, and will lead to more injury and death,” said Linda Lipsen, chief executive of the American Association for Justice, an advocacy group that supports plaintiffs and trial lawyers.
The Chamber of Commerce has worked with another corporate lobbying group, the American Legislative Exchange Council, or ALEC, to encourage states to adopt laws limiting corporate liability for coronavirus exposure. ALEC shared a blueprint for such laws on its website earlier this year that has been closely followed by several state legislatures, said Hugh Baran, a staff attorney at the National Employment Law Project, a nonprofit that has tracked the rollout of state bills.
At least 13 states have enacted laws protecting companies from some litigation related to the coronavirus, and another dozen have proposed their own measures, Baran said. A spokesman for ALEC did not respond to emailed requests for comment.
“There’s a strong chance the McConnell bill will not be enacted, which the Chamber and other corporate lobbyists know,” Baran said. “This is also driving them to pass these state laws.”
According to an online tracker of legal complaints developed by the law firm Hunton Andrews Kurth, some 4,280 claims related to the coronavirus have been filed. The largest categories of complaints related to insurance (1,021), civil rights (796) and prison confinement (601). Just 429 complaints, or about 10% of the total, related to labor and employment.
“When you start to see the storm clouds outside – and we’re starting to see some initial raindrops – you’ve got to go out with an umbrella,” Webb said in the June 1 YouTube video. “If you go out and get soaked and then come back in for an umbrella, it’s a little late at that point.”
Tom Hamburger contributed to this report.