What are your goals? What type of job do you want?
If you are applying with transcripts the initial option is really just whether or not to touch on the circumstances in your covering letter. If your 2L and 3L grades are all Bs and As, your transcript will kind of speak for itself and prove that your 1L grades did not reflect your capabilities. If you do address it in a covering letter I would suggest doing so only briefly - give it one sentence offering that your first year grades are not reflective of your capabilities and were the result of unfortunate external events.
It will probably come up in every interview though. It sounds like you have a very valid explanation. You have no need to be embarrassed.
I wouldn’t address it in a cover letter. If it comes up in an interview, you can briefly address it, but anything in a cover letter is going to come across as you making excuses.
That said, I also wouldn’t wait to try to land a job. Start applying now and see what happens.
You may also want to see if your school has a mechanism for petitioning grades off your transcript. If so, it may be worth pursuing that.