Led by Insurance, South Florida Federal Case Filings Recovering From Coronavirus Trough
New civil lawsuit filings in South Florida federal courts are emerging from a trough caused by the coronavirus pandemic and the suspension of most in-person court operations.
May 20, 2020 at 01:11 PM
5 minute read
New civil litigation filings in South Florida federal courts are making a comeback from a slump that started with coronavirus worries in early March, and insurance cases are leading the rebound.
Miami law firm Podhurst Orseck is contributing to the uptick in insurance and other filings. After assessing where things stood under COVID-19 restrictions, managing partner Steven Marks said a decision was made was to move ahead with cases that had been percolating at the pre-filing stage.
"I am quite confident that we have filed well over 20 cases in the last two months, probably over 30," he said Wednesday in a telephone interview.
The first full week of April was the trough for South Florida federal filings, but it looks like plaintiffs attorneys started adjusting to the new remote reality and began an upswing in filings. The weekly numbers are still below the comparable 2019 levels, but a steady climb has been seen for the last four weeks.
South Florida insurance filings, which are up 8% in a review of practice areas this year, reflect a smattering of lawsuits challenging COVID-19 business interruption coverage denials by insurance companies as plaintiffs attorneys find a common target and push for consolidation into national multidistrict litigation.
Podhurst Orseck and Boies Schiller combined on an insurance class action filing and expect more. Businesses like salons, restaurants and gyms covered by a single insurer are most disposed to class action filings.
But Marks said his firm also is pursuing standalone denials with as much as $1 billion in coverage for a single company.
Boies Schiller's Stephen Zack, who is co-counsel with Marks on an insurance class action, said businesses in the service sector are just beginning to realize their lost income extends beyond reopening into the period when they are limited to a percentage of their normal clientele.
"We see that counting, and we're prepared to represent these folks," he said.
Ali Ansari, a director in Marcum's advisory services division in Boca Raton, sees a need for speed with attorneys pursuing the business interruption filings because law firms want to play an early role in shaping the proposed MDL, which could easily last three to five years.
Attorneys who have reached out to him are filing individual cases and seek his expertise to calculate lost business income. The attorneys also are projecting a coming tsunami of coronavirus-related insurance cases.
Marks agrees since he said the insurance industry took a blanket approach to business interruption claims.
"Everybody is denying them," he said. "The insurers have completely abandoned their contract liability simply because the exposure is so great and they didn't reserve sufficient funds for this type of event. This does not excuse their obligations."
Ansari also expects to see growth in securities litigation. As a member of the Florida Securities Dealers Association, he said: "They're seeing a lot of calls coming to them. They're sorting out the ones with validity."
Overall, new filings excluding mass torts and noncommercial litigation are down 17 percent in South Florida starting with the first big weekly loss in February compared with the same period last year.
The filings leveled off in late February and early March and began plunging the week of March 9 when many people in South Florida began shifting their work from office to home without waiting for government agencies to issue shelter-in-place orders.
The sense of suspended animation is still visible in the weekly filings. The year-over-year decline hit 28% in the worst week but was off only 16% in the week ended Sunday. In raw numbers, the weekly pace of filings peaked at 201 in the last week of February, dipped as low as 134 and recovered to 158.
The most notable decline by practice area is a 60% drop in Americans with Disabilities Act premises access case filings. The Southern District of Florida has been a national leader in ADA claims for years
Also in notable decline are contract cases, which are down 27%, and intellectual property filings, down 19%. Employment and securities case filings are flat year over year.
Nationally, a 22 percent drop in filings was seen in the first four weeks of the pandemic compared with the same period last year, but the May weekly numbers keep tracking higher.
The biggest national jump comes in patent litigation, up 46%, while the sharpest decline is in foreclosures and evictions, down 79% in large part due to federal CARES Act protections barring lenders and servicers from starting new foreclosure actions.
See the South Florida and national charts:
Read more:
More Suits to Come: Podhurst Orseck, Boies Schiller Unite to Sue Insurer Denying COVID-19 Coverage
COVID-19 Pandemic Coincides With Slump in Federal Litigation in US, South Florida
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