December 7, 2021

Volume XI, Number 341

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December 06, 2021

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Restaurant’s Challenge to COVID-19 Declarations Could Go to Bankruptcy Court

A lawsuit filed by Allegheny County and the Allegheny County Health Department (“ACHD”) against The Cracked Egg, LLC may be transferred to the United States Bankruptcy Court for the Western District of Pennsylvania. The Cracked Egg is a restaurant located in Allegheny County, Pennsylvania. Following an investigation by the ACHD in August, the restaurant was ordered to close because it did not comply with mask or facial coverings guidelines.

The ACHD filed a state court civil complaint and emergency motion for preliminary injunction against the restaurant. The Cracked Egg then filed a federal lawsuit against the County and the ACHD alleging that emergency orders and disaster emergency declarations issued by Governor Tom Wolf are unconstitutional and caused harm to the restaurant. The lawsuit asks the court to enter a declaratory judgment that the emergency orders are unconstitutional, stop the imposition of further violations, attorney’s fees and other damages.

Thereafter, The Cracked Egg filed for Chapter 11 bankruptcy in federal court. The restaurant also filed a notice of removal of the state court matter to the Bankruptcy Court for the Western District. The restaurant’s motion seeking referral to the bankruptcy court claims, among other things, that any rulings in the state court action will directly affect the bankruptcy case and, therefore, that court should hear both matters.

With COVID-19 cases on the rise, additional safety restrictions being implemented in states across the country, and a focus on compliance with regulations, more businesses might be filing similar actions seeking relief from violations of the Commonwealth’s and other states’ emergency orders.

COPYRIGHT © 2021, STARK & STARKNational Law Review, Volume X, Number 315
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About this Author

Bianca A. Roberto, Stark Law, Transactional lawyer, Litigation Attorney
Associate

Bianca A. Roberto is an Associate and member of Stark & Stark’s Business & Corporate Group.  Ms. Roberto concentrates her practice in the area of transactional and litigation work, representing corporations, banks, boards, and individuals in a broad range matters. Prior to joining Stark & Stark, Ms. Roberto served as Judicial Law Clerk to the Honorable Robert O. Baldi and the Honorable Wallace H. Bateman, Jr. in the Bucks County Court of Common Pleas.  Ms. Roberto served as a legal intern for The Supreme Court of Pennsylvania for the Honorable J. Michael...

267-759-9662
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