Archive for September, 2013

Fifteen Years Late and $14k Short – An Applicant Returns to Claim his “Rights”

September 30th, 2013 No comments

How long should an applicant be allowed to grumble about unpaid sums prior to being required to take action?  After all, promises of riches are great for propping up dreams, but rights are nothing comfortable to sit on.

I bring to you, the curious case of Alonzo Watkins v. Long Beach Unified School District.  Mr. Watkins was employed as a teacher and sustained an industrial injury in May of 1991 (no, folks, that’s not a typo).  A Findings and Award issued in June of 1996 and an Order Approving Compromise and Release was issued in December of the same year (yeah, folks, that’s not a typo).

Fifteen years later, applicant was zealously up in arms about some unpaid $14,000 based on these two events, and then proceeded with the claim that the defendant had to prove that payment was made.  Somewhere along the life of the case, a WCJ issued an order requiring defendants to provide bank statements, cancelled checks, an audit of its available funds, or a statement as to why these documents were unavailable (realistically, the statement could have been as simple as records are destroyed after X number of years).

Defendant didn’t comply with the order, and instead the matter proceeded to trial before a difference WCJ, where defendant produced a benefits printout and copies of two checks made out to applicant.

Now, it appears there was a filing error, and the trial judge was not able to review the other WCJ’s order to produce bank records, so upon reconsideration, the WCJ recommended that reconsideration be granted.  On the other hand, the Workers’ Compensation Appeals Board, in denying applicant’s petition for reconsideration, reasoned that the issue was not raised at trial, and so could not be raised on appeal.

In any case, the WCAB held that it was applicant’s burden to prove by substantial evidence that he did not receive the payment, and that he failed to meet that burden, so the extra $14,000 he was hoping for were not to be squeezed out of the school district (with all its extra money).

But, recall, dear readers, a different case, that of Barrett Business Services, Inc. v. Workers’ Compensation Appeals Board, where the Court of Appeal held that the defendant was liable for the checks sent to applicant’s address of record that were cashed at a cash-checking service by someone (allegedly) other than applicant.

The facts are different, of course, and the fifteen years of patiently waiting for checks to come in did not meet the reasonable test for applicant’s conduct.

The WCAB got this one right, and the WCJs should have given consideration to the costs to the defendant of performing a 15-year search of all bank records based on the unreasonable claims of an applicant fifteen years late and $14k short.

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On Witty Comebacks and Raising Defenses on Appeal

September 27th, 2013 No comments

Your humble blogger, once in a while, is blessed with a genius comeback – one that stings with sharpness and wit, while awes with its relevance and coolness.  Unfortunately, these comeback come to your humble blogger late at night when he can’t sleep and is reliving the conversation he had earlier that day again… and again… and again…

The thing to do in such a situation is sigh and move on with your life.  What you don’t do is go out and confront the people you previously conversed with hoping to get set up for that zinger (unless your name is George):

I bring you, then, the case of Janet Parker v. Costco Wholesale Corporation, where the defense sought to raise the defense of statute of limitations on appeal.  There, defendant failed to list statute of limitations as an issue in its answer, at the Mandatory Settlement Conference, or at trial (although at trial would have been too late).

What likely happened was that, facing an adverse decision following trial, defense counsel sought grounds for an appeal and realized there was an argument to be made.  So, why not? Get the kitchen sink and throw it in, what could possibly go wrong?

Well, a lot can go wrong.  First off, the Workers’ Compensation Judge noted in his Report and Recommendation on Reconsideration that Labor Code section 5409 specifically provides that the statute of limitations is an affirmative defense and it can be waived (read that as SHALL BE WAIVED) unless it is raised.

Furthermore, raising such an argument does one thing and one thing only – it undermines the credibility of the rest of the petition.  Every single order issued by a workers’ compensation Judge makes at least one person unhappy, and a good portion of those unhappy people darken the doorstep of the WCAB with their grievances.  So, right out of the gate, the petitioner is facing an uphill battle – don’t make the climb any steeper by raising an affirmative defense on appeal.

Finally, if that wasn’t enough, don’t think you can spin the other side’s wheels with a baseless petition: in this case, applicant sought sanctions under Labor Code section 5813 for a petition it called “frivolous and without any reasonable basis.”  The WCAB declined to award sanctions only because “the attorney and law firm responsible for the Petition for Reconsideration are no longer involved in this matter.”  (Your humble blogger, as is his habit, declines to name any names.)

I don’t like the idea of agreeing with applicants’ attorneys, or criticizing his fellow warrior-poets of the defense bar, but remember, dear readers, we’re supposed to be the good guys and the voices of reason – your arguments should stay within the bounds of logic and good faith, and your kitchen sink should stay in the kitchen (and never the twain shall meet).

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Perm. Tot. Disability in Accordance with the Fact? Not So Fast…

September 25th, 2013 No comments

“Permanent total disability shall be determined in accordance with the fact.”  Eerie words from Labor Code section 4662, which allow the trier of fact to find permanent total disability in a variety of cases.

Recently, the Workers’ Compensation Appeals Board reversed a workers’ compensation Judge’s reading of this last sentence of section 4662 to find an applicant permanently and totally disabled.    The WCJ reasoned that the facts in this case, namely the fact that applicant’s impairment, whether by measuring his activities of daily living, ability to function in the work force, or perform essential elements of any occupation, shows that he is PTD.

The WCAB reasoned a bit differently – “[a] finding of total permanent disability ‘in accordance with the fact’ as provided in section 4662 does not preclude apportionment of the permanent disability between industrial injuries as described in Benson.”

Applicant sustained a specific injury and a cumulative trauma, so apportionment was necessary between the two.  The fact that the permanent disability was determined “in accordance with the fact” and not by the rating of impairment, did not negate the need to find apportionment (if appropriate).

The matter was sent back to the trial level to develop the record with respect to apportionment.

Remember, folks: non-industrial, prior-industrial, other-industrial.  Chop that injury into as many little pieces as possible, and suppository of workers’ comp suddenly becomes a much easier pill to swallow.

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Self-Insured Groups: A Country of Their Own?

September 23rd, 2013 No comments

Here at the humble blogger institute, the humble voices inside your humble blogger’s head try to humbly keep our beloved readers up to date on the latest legislative developments.   How, of for all you small businesses out there, the ones who watch the dealings of the G-ds moving legislation this way and that, you may want to keep an eye on a certain bill: Senate Bill 487, introduced by Senator Ron Calderon.

The issue came up at the recent California Self-Insured Association Conference in Walnut Creek (thanks to my beloved readers who stopped by to say hello).  During the presentation by Jon Wroten, Chief of the Office of Self-Insurance Plans, when he discussed the benefits of the Alternative Security Program, which allows larger self-insured employers to retrieve their security deposits for use in operating funds.  Here’s the catch: smaller self-insured employers and self-insured groups are not welcome at the ASP party, and the cold shoulder is truly felt when those smaller self-insured employers and groups have to compete with the big-boys for low prices.

The concern, generally, is that self-insured groups can collapse much faster than large, self-insured employers, and thereby shift liability to all the other members of the Self-Insured Security Fund.  Also, with so many small members and a constantly changing membership, it’s hard to tell just how much the group could pony up in a pinch through the assets of its members.  So, what’s the solution?  I think Mr. Bender put it best:

SB-487 would allow self-insured groups to set up their own security fund, which would not burden the big-boy self-insurers with group defaults, and would also help the groups avoid forking over cash when Safeway and Grimway Farms go belly up (I wouldn’t sell your stock just yet… your humble blogger is just providing an example).

The bill was introduced in February of 2013, and appears to have gone no-where yet.  The bill itself would directly create a Self-Insured Group Security Fund, but rather declare that it “is the intent of the Legislature to enact legislation to establish a Self-Insured Group Security Fund for purposes of workers’ compensation insurance.”  If passed, it would basically be a pre-engagement (“will you someday intend to marry me?”)

Let’s keep an eye on this one, and if you’re an employer who would like to a bit more bite in your self-insured group, maybe you ought to give your elected representative a call on this one too.

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Employer Bears Burden of Proof of No. of Employees

September 20th, 2013 No comments

Labor Code Section 4658(d) holds that if an employer fails to offer regular, modified, or alternative work for pre January 1, 2013 injuries, permanent disability benefits are increased by 15%, unless the employer employs less than 50 people.

But who bears the burden of addressing this issue?  Does the employer have to prove that it employs less than 50 people? Or does the employee have to prove that there are more than 49 employees?

A recent panel decision holds that the burden (like so many burdens in our burdensome system) falls on the defendant.

In the matter of Doug Lentz v. Henry Mechanical, (note, dear readers, how Henry Mechanical proudly notes that it has grown from two employees to its current crew of 33 people)both applicant and defendant petitioned for reconsideration on a variety of issues, but this one in particular struck your humble blogger.  It appears that no evidence was offered with respect to a Notice of Offer of Regular, Modified, or Alternative Work being made, and so the workers’ compensation Judge awarded a 15% increase in permanent disability benefits.

Defendant petitioned for reconsideration, arguing that there had been no finding of fact that defendant employed more than 50 people, so Labor Code section 4658(d)(2) shouldn’t apply.  The WCJ, in his Report and Recommendation, reasoned that defendant was the one best suited to produce this information, and that since producing this information would have benefited defendant, the WCJ can infer that it employs more than 50 people.

The Workers’ Compensation Appeals Board, in denying defendant’s petition for reconsideration, adopted the WCJ’s reasoning.

Now, to be fair, the Labor Code is silent on who bears the burden of proving that the relevant Labor Code section applies.  On the other hand, this seems like harsh treatment for the employer and its insurer.  Certainly, the proper thing in this case would have been to allow the defense an opportunity to develop the record on this issue.  After all, it appears that Henry Mechanical employs less than 50 people (just 33).

In all likelihood, no proof was offered one way or another because the issue was not specifically raised.  However, your humble blogger has cautioned you before, that when permanent disability is raised as an issue, the entirety of Labor Code section 4658 is automatically raised as well.

Well, now we know, that the burden of disproof weighs even heavier on the defense.

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AMA Guides 6th Edition in Play?

September 18th, 2013 No comments

Take a look at your bookshelf (or your lawyer’s bookshelf when you visit his or her office to complain about why the applicants are bleeding you dry) what do you see? AMA Guides 5th Edition? Check.  CEB Workers’ Comp? Check.  Smiling picture of your humble blogger with the biggest thumbs up in the world? Check. Check. Check.

But what about the AMA Guides Sixth EditionNot to be confused with the Sith Edition, which is used for rating permanent impairment in Jedi who have succumb to the dark side of the Force.

Put down the happy pills and close up the liquor cabinet, we’re off to wacky will thanks to the case of Edward Frazier v. State of California, CDCR – Correctional Training Facility.

The AME performed a typical evaluation, but said that the straight rating under the AME Guides would have yielded a 30% whole person impairment, but that didn’t feel right.

So the AME cracked open on the 6th Edition of the AMA Guides and found that “for a gentleman with the same mild left ventricular hypertrophy an impairment of 23% WPI is recommended.”

Now, your humble blogger doesn’t know much about workers’ compensation law, but I’m almost certain I remember something about “the four corners of the guides.”

So here’s the loophole:

Within the four-wall fortress of the AMA Guides, 5th Edition, there is an escape tunnel, and it leads to wherever the evaluating physician wants to go.

The Guzman decision noted that “[t]he physician should be free to acknowledge his or her reliance on standard texts or recent research data as a basis for his or her medical conclusions, and the WCJ should be permitted to hear that evidence.”

Well, in Frazier, the AME looked up the same injury in the sixth edition, and adopted the position that the sixth edition constitutes “recent research” and should be used instead of the fifth edition, and in that way provided a whole person impairment of 24% instead of 30%.

Put away the party hats, this is nothing to be happy about.  This approach opens the door for generic argument that the fifth edition is outdated, and Labor Code section 4660(b)(1) becomes effectively irrelevant, because whenever a party is displeased with the results of the fifth edition, the sixth edition can be deemed “recent research” and used to rate the impairment instead.

Don’t forget, good people of the internet, that the A.M.A. recently recognized obesity as a disease, so don’t be too surprised if this line of reasoning leads you down a trail that ends with you paying for treatment because the office donuts provided by the supervisor contributed at least 1% to the applicant’s obesity.

And don’t look to the legislature to save us either – SB-863 specifically excluded the Guzman issue from discussion (See Section 1, subsection (c)).

Do not be fooled, dear readers, this case is the exception and the trend will go the other way – whichever book, article, research, or chorus of quackery leads to a higher impairment, that’s what will normally fly in California’s worker’s compensation system.

In other words, the fun is just beginning!

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CSIA Conference This Friday!

September 16th, 2013 No comments

Hello dear readers!

Your humble blogger strives to bring you some of the significant happenings and doings going on in the little world of workers’ compensation.  With that goal in mind, let me ask you in my most seductive typing voice: “Hey there, good lookin’ – what are you up to this Friday?”

Whatever it is, cancel it.  Work? Call in sick.  Wedding? Object to traditional ceremonies.  Bar Mitzvah? Adopt a sudden and very temporary disregard for the traditional passage into manhood.

The California Self-Insurers Association is putting on its Northern California conference this Friday (September 20, 2013).  If you have not attended in the past, it is a worthwhile gem and well worth your day.  The speakers are great, the content is informative, and you get a chance to talk to some of the very active self-insured employers in the business.

Phil Millhollon, CSIA Executive Director, plans to use this conference as ac all to employers to become more active in tackling the troublesome trends wearing away at the defense community.  Instead of building walls and withstanding the siege, Mr. Millhollon hopes that conferences like these will encourage self-insured employers, large and small, to work together to mobilize the legislature and the judicial trends.

“So many employers are becoming hermits and not reaching out to other employers and employer groups to become educated on trending topics in workers’ compensation,” says Phil.

So, dear readers, if you’re not going already, I suggest you give it some serious thought.

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Remember 9/11 in 2013

September 11th, 2013 No comments

Hello, dear readers!

Although your humble blogger regularly floods your inbox with cases, legislation, news, and his own bitter musings on life inside California comp, today is not for such a purpose.

It is perfectly normal and expected that we should become absorbed in our callings, even if that call is the raspy, cranky one of workers’ comp.  But we should also strive to poke our heads out once in a while to remember what matters.  This is one of those days.

We all said “never forget” twelve years ago, and we still do.  May this Patriot Day give you a chance for reflection and thought, and put into perspective the annoyances of the comp world in the grand scheme of things.

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A Workers’ Comp Fraud Love Story…

September 9th, 2013 No comments

Welcome back from your weekend, dear readers.  I know it’s a Monday, and Mondays can be tough.  So I bring to you a story of love – love that is unstoppable; love that is immortal; love that even the barrier of shuffling off this mortal coil cannot break.  I bring you the story of Rosa Maria Barajas.

Even after her husband passed away in May of 2010, she continued to receive his love in the form of workers’ compensation payments from New York Life.  However, mean, nasty New York Life decided to get in the way of this special relationship.

According to the press release, Mr. Barajas suffered an industrial injury in 1997 that left him legally brain-dead.  Ms. Barajas was appointed his legal guardian.

Reporting the strange occurrence to the California Department of Insurance, the DOI took a look at the situation, and noticed that Mr. Barajas was receiving over $18,000 per month in benefits… but he wasn’t alive to receive them.   Mrs. Barajas kept cashing the checks, and racked up over $576,000 (by your humble blogger’s calculations) from New York Life.

Well, Ms. Barajas has been arrested and bail has been set at $500,000 (where, oh where, would she get money for bail?)

New York Life might get some of its money back, but I’m sure they would have much rather stopped issuing payments as of May, 2010.  So let this be a lesson for all of us – a bit of diligence with making sure there is living person receiving the checks could save a fortune in the long run.

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“Collaborative Reports” Legally Worthless

September 6th, 2013 No comments

Are you ready for the latest Guzman case, dear readers?  Oh, no, not that Guzman, but rather David Guzman v. Sysco Foods.

The case turned on the issue of applicant’s (attempted) reliance on a “collaborative” medical report.  Apparently, in some medical offices, patients are treated by a team of physicians – like a bottle of Popov’s vodka in a college dormitory, the applicant was passed around several psychiatrists, who all took swigs of her symptoms and later produced reports as “collaborative” work product.

The following scene comes to mind:

Applicant sought to rely on those reports at trial, and the WCJ rejected them because they were not from the medical provider network.

Upon review, the WCAB held that it would have admitted the reports, and then immediately discarded them as failing to establish that “actual events of employment were predominant as to all causes of that psychiatric injury” as required by Labor Code section 3208.3(b)(1).

But how? The doctors sang in chorus of the evils of the employment and the injury done to their patient.

Because the reports were part of a “collaborative process”, involving multiple evaluators within his office, it was “not clear whether [any of the three doctors] provided medical opinions based on his own examination of applicant and review of the relevant medical records.  Because we cannot be sure that the conclusions in the report are based on a relevant factual basis, we cannot rely on these reports to find that applicant sustained an industrial injury to his psyche.”

Do you have a case where the opinions are based on a “collaborative process”?  You might want to whip this panel opinion out and kick those reports to the curb…

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