By Wendy Biddle, J.D.
Neither the consumers’ allegations nor any inference from those allegations provided a basis for the court to find that the retailer was immune from liability under a declaration relating to the recent COVID-19 health emergency issued by the HHS Secretary pursuant to the Public Readiness and Emergency Preparedness Act.
A federal district court in Pennsylvania has declined to grant a retailer immunity from liability for claims relating to hand sanitizer it sold during the COVID-19 pandemic because the consumers’ allegations did not show that the retailer obtained the hand sanitizer in response to the pandemic or under specific distribution channels directed by the Secretary of Health and Human Services (HHS) that would grant immunity. The court denied the motion to dismiss claims against the retailer subject to discovery and further evaluation of whether the immunity to liability defense afforded by Congress and implemented by HHS may apply (Avicolli v. BJ’s Wholesale Club, Inc., April 7, 2021, Kearney, M.).
The consumer purchased a 17oz. Bottle of Blumen Clear Advanced Hand Sanitizer from BJ’s Wholesale Club in May 2020, during the COVID-19 pandemic. Two months later, the manufacturer recalled all of its hand sanitizer because the product contained methanol or wood alcohol. BJ’s issued a press release regarding the recall. The consumer did not know of the recall. The consumer’s wife ingested some of the hand sanitizer in August 2020 and subsequently experienced health complications. The couple sued BJ’s and the manufacturer and distributor of the product for alleged product defect, lack of warning labels, and negligence.
BJ’s moved to dismiss the action arguing (1) immunity from liability under the Public Readiness and Emergency Preparedness Act; (2) the couple did not allege willful misconduct by BJ’s, which is the sole exception to immunity under the Act; and (3) the couple failed to exhaust administrative remedies required by the Act. Congress authorized the HHS Secretary, in the event of a public health emergency, to issue a declaration in the Federal Register that protected certain "covered persons" from liability relating to "claims for loss caused by, arising out of, relating to, or resulting from the administration to or the use by an individual of a covered countermeasure if a declaration has been issued with respect to such countermeasure." Congress further directed that the Secretary identify in the declaration various limits to immunity for each covered countermeasure identified in the declaration, as well as identify whether immunity "is effective only to a particular means of distribution."
COVID-19 health crisis. In March 2020, HHS Secretary Alex M. Azar II issued a Declaration under the Act in response to the COVID-19 pandemic health crisis in the United States. Consistent with his authority under the Act, Secretary Azar limited immunity "only to Covered Countermeasures obtained through a particular means of distribution." The Secretary specifically limited liability for "Covered Persons for [the manufacture, testing, development, distribution, administration, or use of one or more Covered Countermeasures] related to (a) present or future federal contracts, cooperative agreements, grants, other transactions, interagency agreements, or memoranda of understanding or other federal agreements; or (b) activities authorized in accordance with the public health and medical response of the Authority Having Jurisdiction to prescribe, administer, deliver, distribute, or dispense the Covered Countermeasures following a Declaration of an emergency."
Immunity from liability. The court said that the threshold question was whether, based solely on the couple’s allegations, the claims against BJ’s fell within the scope of liability immunity under the Act. The court held that the retailer did not fall within the scope of liability immunity and denied the retailer’s motion to dismiss because the Act did not apply based on the couple’s allegations. BJ’s argued that Congress immunized it from liability to the couple because (1) it is a "covered person" as a "distributor"; (2) hand sanitizer is "covered countermeasure" because it is a "qualified pandemic or epidemic product"; and (3) the claims arise from the "administration or use" of the hand sanitizer. The court however noted that HHS limited immunity to only covered countermeasures obtained through a particular means of distribution, or more specifically (1) any arrangement with the federal government, or (2) any activity that is part of an authorized emergency response at the federal, regional, state, or local level.
The couple did not allege that BJ’s obtained the hand sanitizer under agreement with the federal government or in response to the COVID-19 pandemic. The court also noted that BJ’s did not indicate how it obtained the hand sanitizer in its response filings. The couple’s allegations plausibly could be read to infer that BJ’s obtained and sold the hand sanitizer at issue before the COVID-19 pandemic, according to the court. As such, there was no basis to infer BJ’s obtained the hand sanitizer through the distribution channels necessary to qualify for immunity from liability. Thus, because the court had no basis to conclude how the hand sanitizer was procured, it ruled that it could not conclude that the Act gave BJ’s immunity from liability based on the couple’s allegations. The court denied the motion to dismiss and instructed the parties to proceed with discovery which could uncover facts supporting a finding of immunity.
The case is No. 2:21-cv-01119-MAK.
Attorneys: Kenneth F. Fulginiti (Duffy + Fulginiti) for Nadine Avicolli and Dennis Avicolli. Jason M. Reefer (Pietragallo Gordon Alfano Bosick & Raspanti, LLP) for BJ's Wholesale Club Holdings, Inc.
Companies: BJ's Wholesale Club Holdings, Inc.
MainStory: TopStory DefensesLiabilityNews SCLIssuesNews HouseholdProductsNews PennsylvaniaNews
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