Legal Roundup: Vaping Stores Sue After Shutdown, Transgender Health Care on the Line and More

A look at recent court decisions and how their rulings have an impact on risk management and the insurance industry.
By: | October 16, 2019

In Wake of Massachusetts Vape Sales Ban, Shop Owners Sue

The Case: Behram Agha owns four vape shops in Massachusetts. Due to a new four-month state-wide ban on the sale of vaping products in the wake of mysterious illnesses connected to the electronic devices, his stores are now closed.

Advertisement




That means his 11 employees are out of work and he’ll face an estimated $72,000 in operating expenses during the temporary shutdown, according to the Wall Street Journal.

It led Agha and five other vape shop owners to sue the state. The shop owners argue “that the state’s ban violates the U.S. Constitution and undermines federal regulatory authority,” the Wall Street Journal reported. 

Scorecard: The case was just recently filed so it’ll take time to sort out. 

Takeaway: The lawsuit is no surprise. The number of vaping-related illnesses are small but serious and Massachusetts ban is “the most aggressive state measure yet” to combat them, the Wall Street Journal reported.

“The vaping industry, including retail shops, are arguing these bans are off base and that the problem is illicit products containing THC, the psychoactive ingredient in marijuana.”

The governor, on the other hand, says the temporary ban will help experts discover exactly what’s making people sick and help authorities better regulate the industry in the future.

Transgender Health Care Expands at Georgia Universities Thanks to Queer Eye Guest

The Case: Skyler Jay, a transgender employee at the University of Georgia, sued after not being covered for surgery to treat gender dysphoria which is “described by medical organizations as a conflict between a person’s physical or assigned gender and the gender with which the person identifies,” according to the Atlanta Journal-Constitution.

Jay sued the University System of Georgia and Blue Cross Blue Shield for failing to cover health care needs associated with being transgender. Jay, who recently appeared on the Netflix show Queer Eye, created a GoFundMe page to cover his expenses.

Scorecard: The University System of Georgia and Jay settled the case. Now, transgender employees are “covered for medically necessary expenses. It removes exclusions for sex change services and supplies and drugs for sex change surgeries,” the Atlanta Journal-Constitution reported.

Jay will receive $100,000 in compensatory damages. The suit against the insurer was dismissed because “the company wasn’t liable for the employer’s policies,” according to the New York Daily News

Takeaway: Transgender workers are continuing to fight for coverage of health care procedures and drugs specific to their community — and this settlement is a win for them.

In an Instagram post, Jay said: “The war is far from over in the way of change that must be made in this country for the Trans community. But this is a huge battle won for Trans folks at large and specifically in the state of Georgia.”

Faulty Bicycle Leaves Man a Quadrapalegic. Global Supply Chain Leaves Indemnification Murky 

The Case: As John Giessler rode a bicycle, his front wheel detached and he crashed. The accident left him a quadriplegic.

The bike was sold by Trek Bicycle Corporation, based in Waterloo, Wis. Two Taiwanese companies were involved in the supply chain — Giant Manufacturing Company which manufactured the bike, and Formula Hubs which made the front-wheel release.

Advertisement




“Trek’s primary insurer [Lexington] settled the case, then sought indemnification from Taiwanese insurers by suing in federal district court in Wisconsin,” according to WisBar News.

Scorecard: The case was dismissed in federal district court and that decision was recently upheld by the U.S. Court of Appeals for the Seventh Circuit. The Taiwanese insurers Hotai Insurance Company Ltd. (formerly Zurich) and Taian Insurance Company Ltd. escaped without paying the claim.

WisBar News writes: “ ‘Lexington has failed to demonstrate that either Zurich or Taian made any purposeful contact with Wisconsin before, during, or after the formation of the insurance contracts,’ wrote Judge Amy Barrett for the three-judge panel, noting personal jurisdiction requires a party to have minimum contacts with a forum state to be haled into court there.”

Takeaway: Without a tie to the state of Wisconsin, neither insurance provision provided a basis for personal jurisdiction. &

Jared Shelly is a journalist based in Philadelphia. He can be reached at [email protected]

More from Risk & Insurance

More from Risk & Insurance

Risk Matrix: Presented by Liberty Mutual Insurance

11 Crucial Trends That Are Impacting the Construction Industry Today

Increased hurricanes, opioids, women workers and more are just some of the latest trends driving construction risk.
By: | November 1, 2019




The R&I Editorial Team can be reached at [email protected]