Category Archives: Sanctions

Compensability Presumption Defeated by Lying Applicant

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Apparently, the Home Depot can be a stressful place to work.  William Wong worked at Home Depot as an assistant store manager, but was fired shortly after sending his supervisor a letter by facsimile indicating that he intended to file a workers’ compensation psyche claim.  (William Wong v. The Home Depot)

Then, it was all quiet on the comp front for more than seven years, after which applicant resurfaced to file an application for his psyche injury.

Naturally, the defense invoked the statute of limitations and lawful good-faith personnel action under Labor Code section 3708 defenses.  The workers’ compensation Judge ruled that applicant had documented that the employer had notice of the claimed injury, but he had not been provided with a claim form, and the injury had not been denied within 90 days, so it was presumed compensable under Labor Code section 5402.

If anyone other than applicant’s evaluating physician asked what applicant had been up to in those seven years between the “injury” and the filing of the application, applicant could have told them about his arrest for possession of a controlled substance and resisting arrest.  But that information wasn’t given to the evaluating physician.  He also told the evaluating physician that there was no history of psychosis in the family, even though his uncle had committed suicide.

Needless to say, the workers’ compensation Judge was not impressed.

Although the WCJ held that the presumption of compensability under Labor Code 5402 applied, that presumption was rebutted because applicant proved to be an unreliable historian, meaning that the medical reports based on his statements were not substantial evidence.

Also, the WCJ reasoned, the history of criminal activity and drug use could have been causative factors in his psychotic break.   In other words, as your humble blogger likes to say, No Soup For You!

Bear in mind, my dear readers, the defense in this case got very lucky.  Applicant had a bad history, and lied to the evaluating physician.  If applicant had not lied about his arrest history and the psychosis history of his family, he would have probably recovered and only suffered a bit of apportionment.  In any case, let this be a lesson to us all – hand out claim forms early and often!

Applicant’s Attorney Sanctioned $1,000 for False Statements

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Sanctions.  Sanctions, sanctions, sanctions.  They make the news when they happen, and the defense community involuntarily pumps a fist in support when the Workers’ Compensation Appeals Board imposes sanctions against lien claimants or applicants’ attorneys who play fast and loose with the truth.

Not too long ago, the WCAB imposed sanctions against a Valencia applicants’ lawyer for some less-than-honest statements pertaining to the timeliness of his filed petition.  In keeping with WCDefenseCA’s policy of not naming names, your humble blogger will decline to broadcast the perpetrator’s identity.  But if you e-mail me (Gregory@grinberglawoffice.com), I will send you the panel opinion.

Applicant’s attorney filed a petition for reconsideration on June 28, 2011 even though the underlying Joint Findings and Award was issued January 25, 2011.  To deal with the issue of timeliness (for a discussion of reconsideration and removal, please click here) applicant’s attorney alleged that he never received the F&A when it was served.  But this means that he had 20 days from the date of receipt to file a petition for reconsideration – and the question arose as to when he actually received the F&A.

In answering applicant’s petition for reconsideration of June 28, defense counsel raised the argument that the petition was not timely.  Furthermore, evidence was offered that applicant had the F&A in his hands at an Mandatory Settlement Conference on May 2, 2011.  Your humble blogger may be mathematically impaired, but with the use of his fingers and toes he discovered that June 28 is more than twenty days after May 2nd.

Well, the WCAB ordered an investigation on the trial level into this issue and the question of ex parte communication with a judge and making misleading statements to a judge.  The defense attorney appeared at the hearing to testify, but applicant’s attorney did not.  He later alleged that he calendared the hearing incorrectly (labeling the hearing as 1:00 instead of 8:30) and that the whole thing is moot anyways because “the Fifth amended [sic]” protects him from testifying against himself.

The WCAB was not impressed.

Sanctions of $1,000 were imposed on the applicant’s attorney for the misleading claims regarding when the attorney actually had the F&A.  Because no evidence was offered with respect to the issues of ex parte communication and false statements to a workers’ compensation Judge, sanctions were not imposed for those as well (the applicant’s attorney escaped an additional $2,000 in sanctions).  With respect to the claim of the “Fifth amended,” the WCAB noted that there were no criminal charges pending, so the defense did not apply.

Your curious blogger can’t help but wonder – has this attorney ever claimed to “not have received” some crucial document in the past?  This time he was caught red-handed because a competent defense attorney was able to catch him; perhaps there have been cases where no one remembered or was willing to testify?

So, what lessons can we learn from this story?  Well, for starters, keep a keen eye on your calendar and make sure you don’t miss the chance to testify in your own defense.  Keep an eye on the dates involved – the defense attorney in this case was able to keep the rules and deadlines from being bent out of shape through diligence and a properly drafted answer.

Using MORE Sanctions to Restrain Lien Claimants

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Some time ago, your dedicated and consistent blogger reported on the tactic of using sanctions to restrain lien claimants. After all, if lien claimants want to leverage the cost of litigation to force a settlement, why not turn the tables and leverage the cost of sanctions to knock out baseless liens?

In California’s workers’ compensation system, defense lawyers and applicants’ attorneys agree – liens are not unlike a locust swarm plaguing the system.  The arm movement necessary to swat one only exposes the swatter to more, and all the while they ravage and consume all the green of the land.

It looks like this workers’ compensation lawyer is not just howling into the wind anymore.  In the case of Myra Campos v. Keiro Nursing Home, lien claimant Rift Interpreting filed a lien for interpreter services, but failed to appear at a lien conference and then insisted on proceeding to a lien trial without any apparent evidence to support the validity of its lien.

In fact, it appeared to the workers’ compensation Judge, the Workers’ Compensation Appeals Board, and now appears to your attorney-blogger, that lien claimant expected to use the cost of litigation, rather than the chance of prevailing on the merits, to leverage a settlement.

No doubt, in the past, this very tactic had worked to great success for Rift Interpreting and other lien claimants.  I have had lien claimants pull this stunt before, but to considerably less success than they were hoping for.

The WCJ not only disallowed the lien, but also held that “the activities undertaken by [lien claimant] were egregious and frivolous, warranting sanctions in the amount of $2,500.00 plus the per-capita share of reasonable value of the services rendered by defendant.”

The WCAB denied lien claimant’s petition for reconsideration, noting that lien claimant had not even remotely approached the burden set out in Guitron v. Santa Fe Extruders (2011, en banc), which required interpreter lien claimants to show that (1) that the services provided were reasonably required; (2) that the services were actually provided; (3) that the interpreter was qualified to provide the service; and (4) that the fees charged were reasonable.

Dear readers – don’t feed these lien claimants, even for tiny claims.  I remind you of the story of Three Billy Goats Gruff.  It appearing that the Appeals Board has grown tired of these extortion tactics, now is the time to collectively raise the cost of doing business on lien claimants and cut the cost of doing business in California.

Hearing Representative Misses Again

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Things don’t seem to be going too well for a certain hearing representative struggling to retain the privilege of appearing before the Workers’ Compensation Appeals Board.  A recent en banc opinion dismissed his petition for reconsideration.

Previously, this blog noted the gears starting to turn in this matter, when the WCAB gave notice that it “may suspend or remove” his privileges.  Having no-doubt consulted the “kitchen sink” book of arguments, this hearing representative contended, among other notions, that the whole WCAB is unconstitutional.

The WCAB reminded the hearing representative that reconsideration is only an appropriate remedy when there is a final order (as my readers are well aware) which there had not been.  The WCAB also noted that the petition was not timely, having been filed more than 25 days after the September notice of hearing.  Filing untimely petitions is one of the allegations against this hearing representative.

Is something happening in California?  Governor Brown vetoes anti-employer legislation, the Court of Appeal allows a malicious prosecution case to go forward against an applicant’s attorney, the Supreme Court lands right on COLA… is this the start of a new trend?

Your beloved blogger is too much of a cynic to think so… and time may yet rain on this proverbial employer’s parade.  But one thing appears certain: California’s businesses, though abused and slandered up and down the state, still have some fighting spirit in them and, at least for now, that spirit is shining through.

Tired of Litigating Baseless 132a/Discrimination Claims?

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How many times have you looked at the file on your desk (or your computer screen, for those of this blog’s readers in a paperless environment) and rolled your eyes?  You know the claim before you is baseless; you know it will probably lose; you know the applicant is just shaking you down, hoping it is cheaper to pay him or her off rather than litigate the case.  It makes me even less of a happy camper, the thought of the smiling fraudster applicant and the shady attorney getting away with it (or lien claimant and hearing representative, for that matter).

Wouldn’t you like to do something about it?  Wouldn’t you like to increase the cost of doing business on these guys just a little bit?  Wouldn’t you like to recoup a sliver of that money they made you pay out to defend against a claim with so many holes in it, it was previously used in the spaghetti straining industry?

Sanctions are rarely a remedy, and petty name-calling is generally discouraged in the world of California Workers’ Compensation.  So here is a possible solution – the next time you are facing one of these worthless claims, say those two words that involuntarily appear at the forefront of your mind:

Malicious Prosecution!  (This is a family-friendly blog, after all!)

Without going into the details of the underlying workers’ compensation 132a case (applicant failed to carry his burden and was awarded nothing on the 132a claim), the facts are these:

Employer successfully defeated a 132a claim, then filed a complaint in civil court against the applicant’s attorney and law firm. (Naming names is not done here, at WCDefenseCA, as my dear readers know, but upon request I will e-mail you a copy of the Court of Appeals decision, which includes the names of all parties.  Please send all requests to gregory@grinberglawoffice.com).

The trial court and the Court of Appeals both ruled the case can proceed.  Unfortunately, however, the Court of Appeals opinion is an unpublished one.

Let’s all watch this one closely – if we’re lucky, applicant’s attorneys will be forced to think twice before shaking down employers with baseless claims.

“Sloppy, Unprofessional and Worthy of Sanctions…”

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Have you ever had a petition come across your desk only to think to yourself, “gee, this sure is sloppy, unprofessional and worthy of sanctions?”  If you’re an adjuster or a defense attorney, the answer is probably yes; and then you went about responding to the citations made to the Civil Code of Fantasy Land or whatever else is being argued in the matter at hand.  Now we know, at least occasionally, the commissioners of the Workers’ Compensation Appeals Board find themselves in the same situation.

Sanctions cases are always fun.  For every time the defense community has been wronged, a sanctions case gives us hope that, the next time we’re being harassed, threatened, shaken down, and agitated by obsessed applicants, over-zealous attorneys, or frivolous lien-claimants, that we’ll petition for sanctions and we’ll get them.

In what is quickly becoming “sanctions week” at your humble blogger’s domain, I recently had case of David Hernandez v. Russell Fisher Partnership (insured by ICW Group/Explorer Insurance Company) brought to my attention.  There, applicant appealed from a Workers’ Compensation Judge’s  “take-nothing” order, arguing that the WCJ was mistaken in finding a defense witness credible and the applicant less than so.  The WCAB quickly dispatched the basis for the petition by recognizing that the WCJ is generally afforded an enormous amounts of deference in matters of judging credibility.

The WCAB then continued, noting that applicant’s attorney violated California Code of Regulations section 10842 by attaching as an exhibit the Further Minutes of Hearing and Summary of Evidence to her petition for reconsideration.  But, to take it one step further, this copy of the Minutes had something special: applicant’s hand-written notes and comments.  The WCAB allowed the attorney and the law firm to respond and explain its violation of section 10842.

In her response, applicant’s attorney apologized for “attaching ‘parts of the record already received’ to the petition,” but the WCAB was not impressed with her failure to address the “interlineations with hand-written arguments in the margin.”  The WCAB declared applicants attorney’s “actions to be sloppy, unprofessional and worthy of sanctions in the amount of $250.oo”  In somewhat of an understatement, the WCAB found that “[s]ubmitting an annotated version of the Minutes of Hearing and Summary of Evidence shows a lack of judgment.”

Your proud and upright blogger will decline to name names in this case.  Any readers determined to find the offending party can e-mail me for a copy of the panel opinion.  But I am pleased (my no doubt the constant, overriding goal for all judges in this fine State) with the WCAB standing up for the rules – without a doubt the defense had to absorb the litigation costs of this clearly baseless petition, and though the $250 will not bankrupt applicant’s attorney, perhaps the embarrassment and the record of sanction will help to curb the more egregious behavior.

A special thanks to Kent H. Ball, Esq., of ICW Group Insurance Companies for providing me with copies of these panel opinions.

The Spooky Sanctions of Skeletal Petitions

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Often enough, lien claimants will wage a war of attrition against defendants, hoping that the looming cost of litigation will soften the resolve of defendants in terms of paying undeserving liens.  I have had lien claimants tell me that their settlement demand is cheaper than me “coming down to the Board to litigate” the claim – I’m sure most of us have.  The recent decision in the case of Alfonso Alcaraz v. Hronis, Inc., presents such a situation, and the Workers’ Compensation Appeals Board sanctioned two lien claimants for such behavior.  (My earlier readers may recall a discussion, many blog posts ago, that advocated using sanctions to restrain the greedy little appetites of lien claimants.)

The underlying case was settled by compromise and release, and defendant agreed to pay, adjust, or litigate all liens of record.  The matter of two lien claimants, K. Rad Payman, M.D., and Silver Orthopedic Center, proceeded to trial.  Following the May 3 lien trial, the Workers Compensation Judge issued a Findings of Fact, Orders & Award on June 7.  Defendant filed a Petition for Reconsideration on July 1, and on July 14 the WCJ rescinded his Findings of Fact, Orders & Award, and set the matter for an additional hearing.  So here is where it gets weird…

On July 15, both lien claimants filed a petition for reconsideration, seeking relief from the WCJ’s original, and already rescinded, Findings.

The WCAB ordered the petitions dismissed as moot, but then continued in their opinion to note that the petitions would be dismissed in any case, because they were skeletal and untimely.  (Remember, petition for reconsideration must be filed and received by the Board within twenty days of the issuance of the underlying decision, plus five for mailing if the decision was served by mail.)

The petitions themselves were the very definition of skeletal – claiming new information was found without describing said information or how it would affect the case.  Employing the tactic of Scheherazade, the lien claimants hoped to fill the commissioners with an unyielding curiosity.  Needless to say, the Board was not amused.

On its own motion, the Board sanctioned both lien claimants for their petitions, which were “without merit and done solely for the purpose of causing unnecessary delay or a needless increase in the cost of litigation and are not justifiable.”

Realistically speaking, the sanctions imposed are not going to do much to deter such behavior.  $250 is a cost of doing business, not a “scared straight” event.  On the other hand, sanctions like these are a great thing for another reason – they build up a record that can be used in the future, like in the case of a certain hearing representative.

Aladdin would be proud…

Housekeeping, Pool Cleaning, and Gardening — All Medical Necessities?

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Are services for injured workers such as housekeeping, pool cleaning, and gardening “medical treatment” under Labor Code section 4600 and are treating physicians’ recommendations for such services properly referred to Utilization Review under Labor Code section 4610?  The Court of Appeals recently denied applicant’s petition for a writ of review of a divided Workers’ Compensation Appeals Board decision on these very questions.

In the case of James Bishop v. Workers’ Compensation Appeals Board, applicant allegedly sustained injuries to his back, gastrointestinal system, and bilateral knees over a period of twenty-six years, ending in November of 1996 (a specific injury date of September 24, 1996, was also plead).  In 2006, a Workers’ Compensation Judge found applicant sustained an industrial injury with a permanent disability rating of 77%, after apportionment, and awarded applicant future medical treatment.

Defendant, in abiding by this award, paid for bilateral knee replacements, a hip replacement, and left shoulder surgery.  I mention this little fact just to point out that the defendant was not trying to avoid its duties under this award, nor was defendant a cheapskate.  Applicant received extensive treatment and considerable expense to defendant.  So what’s the problem?  Applicant made demands for housekeeping (8 hours a week), pool cleaning (once a week), and gardening services (once a week), based on the recommendations of the treating physician and the Agreed Medical Evaluator, as well as other “treatment” such as a weight loss program.

The WCJ awarded these services and ordered penalties be paid for unreasonable delay of medical treatment.  Defendant filed a petition for reconsideration, arguing that such services were not medical treatment reasonable and necessary to cure or relieve the applicant from the effects of his injury, and so were not subject to penalties for their delay.  Defendant further argued that because these services were not medical treatment, there was no obligation to refer such requests to utilization review.  (The WCJ found that defendant’s UR denial of the treating physician’s recommendations was timely as to the weight loss program, but being silent on the issues of the housekeeping, pool, and gardening services, was not timely.)

The WCAB found that neither the reports of the treating physician nor the AME constituted substantial evidence because of the unexplained conclusion that such services were medically necessary.  The WCAB also concluded that such services were not “medical treatment” and so were not subject to UR.

The WCAB also instructed the WCJ to clarify his analysis regarding the imposed penalties.

So what should we take away from this?  I would still recommend sending recommendations for in-house services to UR – this was a divided panel and therefore offers even less authority than the typical unanimous decision; it looks like defendant caught a lucky break in this case.  But, all in all, this is a great decision for an obviously responsible and responsive defendant – the matters of medical necessity were paid for; the trivialities of milking the defendant for free house services were properly and effectively resisted.

Often enough, these services are awarded to applicants, but usually the treating physician and/or the A/QME have to do a bit more leg work in their reports.  If you keep a close eye on these reports and requests for treatments, you might catch an M.D. or, more likely, a D.C. cutting corners, and thereby cutting you a path to denying “treatment.”

What’s your craziest story?  Free hot tubs? Manicures and pedicures?  If you’ve got a crazy story, let me know – gregory@grinberglawoffice.com

Reconsideration or Removal? Part 3 of 3

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There you sit at your office desk, opening your mail, when you see it – a bulky envelope with an applicant’s attorney’s return address.  Without opening it, you know what it is – the applicant is filing for reconsideration of some minor procedural order that the Workers’ Compensation Judge issued but 19 days ago.

You know it is not a final order and, at most, it should be a removal action.  But now the case that was going along so well has this matter to deal with.  Picking up the phone, you call your workers’ compensation defense attorney, and decide you want to try something new to get rid of this fast.

Does your attorney have some new tactic up his sleeve to help this petition die on the vine?

Here is my idea: in the case of Sergio Corrales v. Avis Rent-A-Car, the applicant’s attorney filed for both reconsideration or, in the alternative, removal of a WCJ’s order setting the underlying cases for trial.  The Workers’ Compensation Appeals Board dismissed the petition for reconsideration as improper, because the order setting the cases for trial was not a final order.  It then denied the petition for removal on other grounds.

How is this relevant?  The WCAB specifically admonished applicant’s attorney that “the filing of a petition for reconsideration to challenge the WCJ’s order setting this case for trial could be viewed as an action or conduct that is frivolous or solely intended to cause delay and subject to sanctions…”

In the case of Antonio Morales v. WCAB (2011) 76 Cal. Comp. Cases 841, the WCJ specifically recommended that sanctions be imposed for filing for recon from an order for a replacement panel, but the WCAB did not address the issue, either as a silent rejection or as an unintentional oversight.

Corrales was filed in June of 2011, and is a slightly more recent opinion than Morales.

Now comes the maneuver:

Upon receipt of the petition for reconsideration, send a letter to applicant’s attorney with a copy of the Corrales panel opinion [please e-mail me if you would like a copy of the panel decision: gregory.grinberg@htklaw.com], and a copy of a panel, en banc, or higher court opinion finding a certain act appropriate for removal but not appropriate for reconsideration.

Don’t threaten – just point out that a petition for reconsideration is not appropriate in this case and it should be withdrawn.

If the applicant’s attorney does not withdraw the petition for removal before you file your answer, seek sanctions.  If this crazy maneuver works, the applicant’s attorney will either withdraw the frivolous and inappropriate petition for reconsideration, or (hopefully) the cost of fighting the petition will be out of applicant’s attorney’s pocket.

Granted, this is by no means an established tactic – but if you’re looking to try a new maneuver, this might just work.  What’s more, there will be close cases, where there is no established precedent for whether the proper course of action is reconsideration or removal.  But, in most cases, this might just be the trick to cut delay and litigation costs.

Below are some good examples of removal and reconsideration cases.

Proper actions for removal:

  1. Finding of fact as to which of two QME panels was properly issued. Tsegay Messele v. Pitco Foods, Inc. (2011) 76 Cal. Comp. Cases 956 (en banc).
  2. WCJ’s order to take matter off calendar until applicant was re-evaluated by AME.  Gregory Lapold v. WCAB, Lloyds Transmission (2011) 76 Cal. Comp. Cases 1030.
  3. Judge’s denied of a petition to have three cases consolidated into one.  PBMS, Inc. v. WCAB (2010) 76 Cal. Comp. Cases 1015.
  4. WCJ’s order to the Medical Unit to issue a new panel following a finding of ex-parte communication.  Antonio Morales v. WCAB (2011) 76 Cal. Comp. Cases 841.
  5. Judge’s order regarding which of defendant’s representatives could attend applicant’s deposition.  Amador Padilla v. WCAB (2011) 76 Cal. Comp. Cases 191.
  6. Judge’s order denying defendant’s petition to disqualify applicant’s attorney. Advantage Workers’ Compensation Insurance Company v. WCAB (2010) 75 Cal. Comp. Cases 1415.
  7. Judge’s issuance of an order alleging that Defendant’s attorney and its adjuster were in contempt of court.  All Tune & Lube v. WCAB (2010) 75 Cal. Comp. Cases 503.
  8. WCJ’s order for additional discovery following trial to “develop the record.”  Bates v. Valley Vintners Wine Company (2011).
  9. An order granting a party motion for change of venue.  French v. Warner Brothers (2011) 13 WCAB Rptr. 13,216.
  10. WCJ’s order denying defendant’s petition to dismiss.  Barbara Guthrie v. Weyerhaeuser Company (2004).
Proper actions for reconsideration:
  1. An order finding liability for an injury.  Denise Hernandez v. Big Buy Food (2011).
  2. An order to take nothing on a Labor Code section 132a claim.  Miller v. County of Alameda (2011) 39 CWCR 208.
  3. A finding that defendant is not required to pay for a medical procedure.  Navarro v. Vengroff  Williams Associates (2011).

Reconsideration or Removal? Part 2 of 3

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Yesterday we covered the appeal of a final order through the procedure of a Petition for Reconsideration.  Today’s topic is the alternative, a Petition for Removal.

A removal action, much like a recon, must be filed within 20 days of service of the aggrieving order.  [Don’t forget the additional days for mailing!] However, the standard to proceed on removal is very different.

The appealing party must show (1) the WCJ’s order will result in prejudice; (2) the WCJ’s order will result in irreparable harm; and (3) reconsideration after a final order is made does not provide an adequate remedy. (8 CCR § 10843.)

So if an applicant’s attorney or a lien claimant files a petition for removal, there’s really no frustration involved for the defense – either there is a valid point being made, in which case defeating the petition is just part of the job, or there isn’t, in which case the high barrier set by § 10843 should do most of the work.

But if an applicant’s attorney files a petition for reconsideration, or, as appears to be the common practice, a “petition for reconsideration, or, in the alternative, petition for removal,” frustration is warranted.

Now, the case is ground to a halt, as per LC § 5910 and CCR § 10859, and the defendant has to watch the good Panel Qualified Medical Evaluator fill up his appointment book, the best witnesses move away or get forgetful, and medical bills grow and grow like the pile of abandoned food in the back of the office break-room fridge.

When the applicant’s attorney files a petition for reconsideration, alone or with the petition for removal, either because he or she didn’t bother to read the file and do the research, or with the sole purpose of delaying the proceedings, what can the defense do?

Well, the common response is to fight the petitions with an answer or two, and hope the WCAB denies the petitions.

But if you’re brave and would like to take a gamble, I’ve got a “crackpot” maneuver for you to try that I will eagerly reveal in tomorrow’s post.