Bethany Ao1Bethany Ao is a J.D. Candidate at the University of Chicago Law School, Class of 2024. She thanks Matthew Makowski, Abigail Barney, Annie Kors, and the University of Chicago Law Review Online team. She also thanks the health reporters at the Philadelphia Inquirer for inspiring this piece.
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After Ricardo Saldana suffered a stroke in 2014, his family moved him into Elms Convalescent Hospital, a skilled nursing facility in Glendale, California, so he could receive the care he needed. Despite his illness, Saldana was stable and regularly received visits from his wife and children.
In late March 2020, the nursing facility knowingly transferred a resident who had been exposed to COVID-19 into Saldana’s room. Shortly after, Saldana developed symptoms of COVID-19. He died on April 13, 2020. His family brought a wrongful death suit against Glenhaven Healthcare, the operator of the facility, under California state law. The Saldanas alleged that the facility failed to take appropriate measures to stop the spread of the virus.
Saldana v. Glenhaven Healthcare LLC (9th Cir. 2022) is one of many negligence suits that plaintiffs have brought against nursing homes over how their COVID-19 protocols, or lack thereof, may have led to residents’ deaths. So far, each of these cases has been a standard tort suit brought under state law. However, nursing homes and senior living communities have attempted to defend themselves by removing the cases to federal court and invoking a clause in the PREP Act that grants immunity from suit and liability for the usage of devices intended to limit the harm caused by a pandemic. To escape liability, defendants have argued that the PREP Act is so all-encompassing that there is no room for state law claims under the doctrine of complete preemption, which applies when a federal statute is so broad that it wholly displaces any state law claims on the same subject matter.
The question of whether the PREP Act preempts state tort law when plaintiffs raise wrongful death claims related to COVID-19 could have implications for future litigation arising from public health emergencies.
This Case Note examines the Ninth Circuit’s analysis in Saldana, the legislative intent behind the PREP Act, and how other circuit courts have dealt with the question of PREP Act immunity stemming from the COVID-19 pandemic thus far. Part I briefly discusses the history and purpose of the PREP Act. Part II summarizes the facts and procedural details of Saldana. Part III addresses the emerging circuit split about whether the PREP Act completely preempts any tort claims under state law. Part IV lays out the legal and policy implications of allowing nursing homes to use the immunity defense. Finally, Part V makes a recommendation for how circuit courts that are still undecided should proceed.
I. The PREP Act
Congress passed the Public Readiness and Emergency Preparedness (PREP) Act in 2005 to shield vaccine manufacturers from financial risk in the event of a declared public health emergency after the global spread of avian influenza. The goal of the statute was to encourage developers of medical countermeasures to act quickly during a public health emergency.
The PREP Act limits liability for “claims for loss caused by, arising out of, relating to, or resulting from the administration to or use by an individual of a covered countermeasure.” “Covered countermeasures” include devices used to “limit the harm . . . [a] pandemic or epidemic might otherwise cause.” During public health emergencies, the Secretary of Health and Human Services (HHS) can issue a PREP Act declaration, which provides immunity from tort liability claims (except willful misconduct) to individuals or organizations manufacturing, distributing, or dispensing medical countermeasures.
The only exception to immunity from suit and liability under the Act is for an exclusive federal cause of action against a “covered person”—defined by the statute as a person or entity that is a manufacturer, program planner, or distributor of covered countermeasures or a qualified person who prescribed, administered, or dispensed such countermeasures—for “death or serious physical injury proximately caused by willful misconduct . . . by such covered person.” If someone wishes to bring an action against a covered person who may have engaged in willful misconduct, they must do so in the U.S. District Court for the District of Columbia.
In March 2020, then-Secretary of Health and Human Services Alex Azar issued a declaration under the PREP Act “to provide liability immunity for activities related to medical countermeasures against COVID-19.” This declaration gave immunity to covered persons using “any antiviral, any other drug, any biologic, any diagnostic, any other device, or any vaccine, used to treat, diagnose, cure, prevent, or mitigate COVID-19.”
II. Saldana v. Glenhaven Healthcare LLC
After Saldana’s death, his family sued Glenhaven Healthcare in California state court, alleging that the nursing facility operator failed to adequately protect Saldana from COVID-19 during the pandemic. They claimed that Glenhaven not only failed to implement appropriate safety measures but that it also prevented its staff from protecting themselves and the residents from COVID-19.
After Glenhaven removed the case to the District Court for the Central District of California, the judge found that supervisors told staff that they could not wear their own masks even after they had been sick. A box of masks provided to the nursing facility by the local fire department was locked away. Supervisors also routinely downplayed the virus by “compar[ing it] to the flu” and failed to disclose that one of the nurses had been exposed while working at a facility that had been closed because of uncontrolled COVID-19 infections. Finally, Glenhaven staff moved a resident who had shared a room with a COVID-19 positive resident into Saldana’s room.
In their suit, the Saldana family asserted four state law claims: (1) elder abuse, (2) willful misconduct, (3) custodial negligence, and (4) wrongful death. Glenhaven Healthcare removed the action to federal district court, contending that the Saldana family’s state law claims were preempted by the PREP Act. The district court ruled that the removal of the civil action was improper because the PREP Act does not have extraordinary preemptive force.
The Ninth Circuit agreed with the district court’s ruling, saying that the PREP Act does not completely preempt the Saldana family’s tort claims. Although the HHS Secretary and the HHS Office of General Counsel concluded that the PREP Act is a complete preemption statute through an advisory opinion, the court noted that “an agency’s opinion on federal court jurisdiction is not entitled to Chevron deference.” Instead, the court applied a two-part test articulated in City of Oakland v. BP PLC (9th Cir. 2020), which asks two questions: (1) did Congress intend to displace a state law cause of action, and (2) did Congress provide a substitute cause of action?
On whether Congress intended to displace a state law cause of action, the court said that the fact that there is only one subsection in the PREP Act that explicitly states that there is an exclusive federal cause of action limited to claims against covered persons for willful misconduct undermines the argument that Congress intended the statute to completely preempt all state law claims related to the pandemic. The court treated this as a narrow carveout that excludes claims for negligence and recklessness, saying that just because one claim may be preempted does not mean that the entire federal statute is so comprehensive that it entirely supplants state law causes of action. The statute also did not provide substitute causes of action for non–willful misconduct claims, like the ones brought by the Saldanas, so the Ninth Circuit ruled that the PREP Act does not entirely supplant state law claims. Glenhaven petitioned the Supreme Court for certiorari, but the petition was denied in November 2022.
III. Other Circuits’ Approaches to the Preemption Question
Multiple circuits have faced the question of whether the PREP Act completely preempts state law claims in the context of a COVID-19 wrongful death suit. But so far, none of the circuits have held that all state law claims are completely preempted by the PREP Act.
The Third Circuit was the first federal appellate court to address this question in Maglioli v. Alliance HC Holdings LLC (3d Cir. 2021), a case in which two New Jersey nursing homes were sued for negligence by the estates of four residents who died from COVID-19. The court used a two-part test to decide whether the PREP Act was completely preemptive: (1) Does the PREP Act create an exclusive federal cause of action? If it does, (2) do any of the estates’ claims fall within the scope of that cause of action?
The Third Circuit ruled that the PREP Act only invokes an exclusive federal cause of action for claims of willful misconduct. Since the estates alleged only negligence and not willful misconduct, the federal cause of action did not come into play. The court then noted that the language of the exclusive federal cause of action indicates that it is completely preemptive, but only for claims of willful misconduct. To remove a suit to federal court, the nursing homes must also show that the state law negligence claims fall within the scope of that cause of action. This ruling means that if future plaintiffs bring claims that can be properly categorized as willful misconduct under the PREP Act, a federal court can exercise supplemental jurisdiction over the state law causes of action. In a notable contrast, the Ninth Circuit avoided ruling on whether the exclusive federal cause of action completely preempted any state law claims for behavior that fits the PREP Act’s definition of willful misconduct in Saldana.
The Fifth Circuit held in Mitchell v. Advanced HCS, LLC (5th Cir. 2022) and Manyweather v. Woodlawn Manor, Inc. (5th Cir. 2022), cases with near-identical facts to Maglioli and Saldana, that state law claims are not preempted by the PREP Act. In Mitchell, the court applied its own test for complete preemption and said that to establish complete preemption the defendant must show that federal law created a cause of action that both replaces and protects the analogous area of state law, that Congress has empowered federal courts to hear that cause of action, and that Congress clearly intended that grant of jurisdiction to be exclusive.
Like the Third Circuit, the Fifth Circuit interpreted the cause of action in the PREP Act to be very narrow by focusing on two issues: (1) the inability of the plaintiff to bring negligence claims under the PREP Act due to a more stringent standard for liability and (2) the fact that plaintiffs in these wrongful death cases did not allege loss caused by “administration” or “use” of measures used to counter COVID-19. The court said in Mitchell that the plaintiff could not have brought his claims of negligence under the PREP Act because the statute states that its cause of action creates “a standard for liability that is more stringent than a standard of negligence in any form or recklessness” (emphasis added). The Fifth Circuit then applied this higher standard to the facts of the case and concluded that the exclusive federal cause of action for willful misconduct was simply not relevant to the claims raised in Mitchell because the plaintiff only asserted state law causes of action for medical negligence, corporate negligence, and gross negligence. In Manyweather, the court expanded upon this line of reasoning, saying that even if the plaintiffs meant to plead a willful misconduct claim in addition to their negligence claims, they did not allege loss caused by “administration” or “use” of COVID-19 countermeasures, such as masks, which goes against the PREP Act’s language of covering “any claim for loss that has a causal relationship with the . . . use of a covered countermeasure.”
In Martin v. Petersen Health Operations (7th Cir. 2021), the Seventh Circuit agreed with the Fifth Circuit, saying that while face masks and other personal protective equipment were among covered countermeasures under the PREP Act, the plaintiff “[did] not allege that the face masks led to her mother’s death; instead she alleges that the nursing home failed to use masks and other protective equipment . . . the opposite of a contention that a covered countermeasure caused harm.”
While all of the circuits that have dealt with this question have remanded these cases to state courts because they lack jurisdiction over the negligence claims, they have used different tests and lines of reasoning, mainly derived from intracircuit precedent, to arrive at their conclusions. But it appears that the Supreme Court does not find this lack of uniformity particularly problematic, as it denied Glenhaven’s petition for certiorari in Saldana. Whether the cause of action for willful misconduct is completely preemptive is unclear, but the Western District of Louisiana ruled that it was not in Coleman v. Intensive Specialty Hospital2No. CV 21-0370, 2022 WL 17779323 (W.D. La. Dec. 19, 2022). because the plaintiffs’ willful misconduct claim failed to meet the heightened standard required by the PREP Act. This highlights a potential problem—that the level of willful misconduct required to meet that heightened standard has not been fully explained or standardized across courts. And the flood of wrongful death suits arising from how nursing homes handled COVID-19 shows no sign of stopping—the Eleventh Circuit is currently considering this issue in Schleider v. GVDB Operations, LLC (S.D. Fla. 2021), and similar cases are before the Second and Sixth Circuits.
IV. Legal and Policy Implications
The PREP Act grants immunity to vaccine and biologics manufacturers during a pandemic because they are taking on risk in the hopes of acquiring a significant benefit for the general population. The legislative history of the PREP Act clearly shows that lawmakers were thinking along these lines when they passed the statute.
There is a strong argument for giving vaccine manufacturers this protection. Vaccines often take years to develop because manufacturers must conduct highly controlled trials, an expensive and labor-intensive process. After the vaccine is released, the manufacturer is strictly liable if the product is defective. But during a deadly and destructive public health emergency, the government cannot afford to wait. By waiving liability for that window of time, the government places significant value on the potential benefits of vaccinating the general population as quickly as possible.
Very little of this logic is applicable to the situations that arose in some nursing homes during the early stages of the COVID-19 pandemic. The risks that the nursing homes and assisted living facilities incurred were not from “the administration to or use” of potentially helpful countermeasures, such as a vaccine, but rather from inaction, which the PREP Act did not intend to protect. Withholding protective gear and recklessly relocating patients who had been exposed to COVID-19 did not result in any sort of perceivable benefit to the general population, nor did the facilities undertake risks related to product development or use expecting there to be benefits to residents.
Furthermore, allowing nursing homes and assisted living facilities to be immune from state law claims because of federal preemption under the PREP Act will make it significantly easier for them to escape all liability, since only willful misconduct, which is much harder to prove than negligence, is actionable. This has significant policy ramifications. It is crucial to recognize that the populations in those facilities are more vulnerable during public health emergencies than the general population. These residents are likely to have preexisting health conditions. Their living conditions and safety precautions are determined by and under the control of the facility. Even if certain residents were uncomfortable with their facility’s pandemic protocols, they likely lacked power to effectively advocate for safer conditions. Letting facilities that failed to distribute masks and recklessly moved residents who had been exposed to COVID-19 into rooms with vulnerable patients escape liability would allow these facilities to act with similar negligence in the future.
Withholding PREP Act immunity from the facilities that failed to act responsibly during the COVID-19 pandemic and remanding the wrongful death cases they are implicated in to state courts would incentivize those facilities to act more responsibly during the next public health emergency. While confusion and doubt over public health directives is understandable at the beginning of a pandemic, the nursing homes and assisted living facilities implicated in these cases engaged in obviously risky behavior by discouraging staff from masking and by hiring employees from other facilities that had problems with containing the pandemic. Liability under state law would make the facilities less likely to engage in that sort of behavior and more likely to follow public health directives and protocols.
V. Recommendation for Undecided Circuits
Circuit courts that are still undecided on this issue should hold that the PREP Act does not completely preempt all state law claims for negligence because the statute is inapplicable to nursing homes and assisted living facilities that failed to take reasonable COVID-19 precautions. As discussed above, Congress meant for the PREP Act to protect actions that could lead to a significant public benefit, not harmful inaction.
A court should carefully consider the facts in these types of cases. For example, a nursing home that is being sued over its administration of hydroxychloroquine to COVID-19 patients before the Food and Drug Administration revoked its emergency use authorization for the drug in June 2020 has a stronger argument for federal preemption by the PREP Act than the nursing homes and assisted living facilities in the cases discussed above. This is because administering hydroxychloroquine isn’t harmful inaction. Rather, the facilities were hoping that it would confer a benefit, despite the limited information available to them at the time on its usefulness. A state court addressing negligence could give these facts proper treatment and allow the differences between denying staff members masks and administering an unproven treatment to control the outcome. Allowing state courts to determine whether liability exists in the negligence suits will let federal courts exercise restraint properly and lead to better policy outcomes.
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Bethany Ao is a J.D. Candidate at the University of Chicago Law School, Class of 2024. She thanks Matthew Makowski, Abigail Barney, Annie Kors, and the University of Chicago Law Review Online team. She also thanks the health reporters at the Philadelphia Inquirer for inspiring this piece.