News Release

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CRA President and CEO Rachel Michelin in The Real Deal (LA’s Real Estate News) Lawsuits Being the Next Crisis for LA Malls

Lawyers advise on retailers facing potential lawsuits

TRD LOS ANGELES /June 22, 2020 11:15 AM
By Matthew Blake and Sasha Jones

In Jacksonville Beach, Florida, 16 employees and patrons of an Irish pub were infected with coronavirus in just one evening.

And in suburban Chicago, Walmart was sued by the family of an ex-employee who died after she allegedly contracted coronavirus at work.

These incidents are happening as brick-and-mortar shops reopen across the U.S. including Los Angeles County, which greenlighted the return of mammoth malls like The Grove and Del Amo Fashion Center that power the region’s retail economy.

The totems of L.A. sprawl and sunny consumerism are back after blanket shutdowns, tenants not paying rent, and looting and vandalism following the death of George Floyd.

Their return might be the best of bad options for besieged mall landlords, but it poses new problems. One to watch for is exposure to coronavirus-related lawsuits from customers and employees, as the county’s coronavirus toll shows no sign of decline.

California Gov. Gavin Newsom has said the decision to reopen retail, “is foundationally a question for local health directors and local health officials.”

State and county officials, meanwhile, are mostly lawsuit proof.

“Local government generally has some level of immunity protection, unless there is intentional malfeasance,” said Greg Aldisert, an attorney at Kinsella, Weitzman, Iser, Kump and Aldisert.

The target of a potential lawsuit from a customer or employee who falls ill, Aldisert said, then is the mall and possibly a retailer in the mall as well.

Trade groups like the California Retailers Association have spent months pushing for some type of legal immunity as stores reopened, but have hit a legislative dead end.

“There’s not the political will to make it happen,” said Rachel Michelin, president and CEO of the California Retailers Association. “We just haven’t been able to gain traction on it.”

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