Archive for April, 2017

City of Jackson: Court of Appeals Uphold Apportionment to Genetics

April 28th, 2017 No comments

Happy Friday, dear readers!

Your humble blogger is very happy to report that in its recent decision, the Court of Appeal ruled that however great a fall Humpty Dumpty might sustain, all the king’s horses and all the king’s men are only responsible for putting back that part of him that was industrially injured.

Convoluted enough for you?  Well, prepare to have your mind blown – nowhere in the rhyme does it say that Humpty was an egg.  In fact, he was a workers’ compensation applicant in California’s claims system.

The case I speak of (or write of, depending on whether my pestering lawyer voice is already stuck in your head) is City of Jackson v. WCAB.   Therein, applicant, a police officer, alleged a cumulative trauma to his neck, shoulder, arm, and hand.  The PQME opined that 49% of his permanent disability as to the neck was caused by genetics and not by the cumulative trauma.

Although the WCJ sustained this apportionment, the WCAB reversed, finding instead that the report was not substantial evidence as to apportionment because apportionment to genetics was an impermissible immutable factor.  The Board further opined that such apportionment is an apportionment of the injury rather than the permanent disability.

The Court of Appeals disagreed.

After reviewing the facts and procedural history, the COA noted that the enactment of SB-899 allowed apportionment of permanent disability based on causation.  Citing Brodie v. WCAB, the Court of Appeal noted that “[s]ince the enactment of Senate Bill No. 899, apportionment of permanent disability is based on causation , and the employer is liable only for the percentage of permanent disability directly caused by the industrial injury.”  The COA continued that the law specifically permits “apportionment based on pathology and asymptomatic prior conditions for which the worker has an inherited predisposition.”

In citing the case of ACME Steel v. WCAB, the Court of Appeal also held that there is “no relevant distinction between apportionment for a preexisting disease that is congenital and degenerative, and apportionment for a preexisting degenerative disease caused by heredity or genetics.”

Accordingly, the PQME appropriately identified and estimated a non-industrial cause of applicant’s permanent disability.  The Court of Appeal ruled that this genetic predisposition was not an impermissible immutable factor.

We’ve seen something like this before, though it went largely unnoticed: in the matter of Reff v. WCAB, a 2011 writ denied case, the industrial pneumonia lit up applicant’s pre-existing but asymptomatic  common variable immune deficiency, resulting in significant disability and need for treatment.

Another interesting fact in this case was the element of causation – as this was claimed as a cumulative trauma, the Court of Appeal opined that the QME was not apportioning to causation of injury, as the QME was not asserting that the repetitive motion that caused the injury was in turn caused by genetics.  Instead the disability was caused by applicant’s genetics.

So, some take-aways from this case: some QMEs will decline to apportion to pre-existing or non-industrial conditions, reasoning that, if applicant was able to perform his job duties before, there was no visible disability.  But, this opinion appears to hold that apportionment to asymptomatic pre-existing conditions that are only triggered by the industrial injury is appropriate.

Furthermore, genetic conditions are apparently NOT an impermissible immutable factor.  The Court of Appeal expressly rejected this holding to opine that it is permissible for a QME to apportion permanent disability to such a condition.

For the more serious cases, this seems like a good opportunity to bring up the concept of 4050 exams.  If the stakes are high enough,  it might make sense to hire a 4050 doctor to conduct an exam, and offer both literature and guidance to the defense attorney on the extent of permanent disability that should be attributed to non-industrial causes, such as genetic conditions.

Score a point for the good guys!

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Employer Goes Down for WC Fraud

April 21st, 2017 No comments

Happy Friday, dear readers!

Today I bring you the story of Chang Tai Lin, of Salinas, who was recently sentenced for various forms of fraud related to underreporting the number and earnings of his employees to get lower workers’ compensation premiums.

His restaurant, AA Buffet, had more employees than what was reported to his insurers over a span of some six years (2010-2016), and also some of their pay was disbursed in cash to avoid reporting the income.

Here’s the district attorney’s press release.

Fraud is a bad thing, and employer fraud is no exception.  The effect ripples, harming insurers that have to shift the burden not carried by one insured to the others.

But, as clearly illegal as this was, let’s not get all high and mighty just yet.  Mr. Lin was neither the first, nor the only business owner to engage in such conduct.  There are employers who spend some time crunching numbers and come to the conclusion that their business will be in the red if they comply with the laws.  Unfortunately, some of them make the decision to not comply with the law and risk it.  Some of them don’t get caught and are able to undercut their competition on prices.

On several cases, I’ve had the opportunity to discuss this subject with policy holders while preparing the defense of a case.  Business owners, wall-to-wall, have told me about how hard it is to keep the lights on.  Workers’ compensation costs are not the only factor, but they are just another link in the chains weighing down business owners.  Some of them choose to leave California; some of them choose to close up shop and get a day job; and, of course, some employers, like Mr. Lin, choose to break the law.

I have no interest in defending Mr. Lin’s actions or offering justification or excuse.  I do, however, think we as Californians need to be aware that there are no externalities and there are no vacuums.  The economy is an interconnected organism, and when our fellow Californians do things like advocating a yearly depletion of the return-to-work fund  to increase assessments against employers and insurers; turn employers into insurers for the results of pregnancy; or bend the law to provide unnecessary and undeserved benefits to workers who exaggerated their symptoms; the money has to come from somewhere.  That usually means higher prices for consumers, or driving businesses away.

California should be a place where the cost of being a law-abiding citizen and business-owner is low compared to the penalties for violating the law and the odds of being caught.  Instead, the high cost of compliance continues to tempt desperate employers into breaking the law.

Just some food for thought for your weekend, dear readers!

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Reuters: States with Med. MJ Seeing Decrease in Opioid Hospitalizations

April 19th, 2017 1 comment

Happy Wednesday, dear readers!

As Americans, we tend to look down on the pot calling the opioids drugs (or is it the pot calling the kettle black?), but the truth is that in California, as in the rest of the Nation (and the world?) Marijuana remains to be an issue for medicinal purposes, recreational use, and, of course, workers’ compensation.

The rhetoric is fairly polarized.  In the pro-legalization side, users and non-using supporters argue that the most dangerous aspect of marijuana is being caught by law enforcement officers while possessing it and being exposed to the dangers of arrest and incarceration.

On the other side, those in favor of prohibition argue that it is used as a gateway drug to more serious narcotics and as a funding tool for terrorists, international criminal syndicates, and violent criminals.

Putting aside the morality of it all and focusing just on the impact on workers’ compensation, the question is still open, after all these years, whether an injured worker can require an insurer to reimburse him or her for medical marijuana obtained in compliance with California’s laws and in blatant violation of Federal regulations.

But, as tomorrow is April 20th, which appears to be a holiday for neo-Nazis and marijuana enthusiasts alike, I thought I’d share an interesting article that has been floating around the web.

Recently Reuters reported that “[i]n states that legalized medical marijuana, U.S. hospitals failed to see a predicted influx of pot smokers, but in an unexpected twist, they treated far fewer opioid users”.

In the workers’ compensation community, we regularly bemoan the effect opioids have on our claims.  Some doctors go as far as offering three-month supplies for a substance they know is highly addictive and devastating.  Your humble blogger has had injured workers tell him at deposition that they pay for medical marijuana out-of-pocket and decline industrially provided opioid drugs because of the difference in effect: both provide pain relief, but for some injured worker, medical marijuana allows them to have overall function in their activities of daily living, while the opioids do not.

Your humble blogger is frustrated at the idea that workers’ compensation premiums should pay for what is generally perceived as a recreation drug while no one is willing to subsidize my cocktails. That frustration aside, however, it may be worth exploring what impact “Mary Jane” will have on the bottom line.  If paying for medical marijuana actually is cheaper and gets better results, should insurers consider reimbursing injured workers to discourage opioid dependence?

Obviously, every workers’ compensation pocket will have to decide this for itself, but as we’re all looking for better results with lower costs, perhaps some brave defendants will step up and be our marijuana guinea pigs?

Drive safe, tomorrow, dear readers – I anticipate more than a few drivers and pedestrians absent-mindedly walking around when the smoke gets in their eyes.

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0% Credibility? Still an Employee and NOT an IC

April 17th, 2017 No comments

Alright, dear readers! WE ARE BACK!

Spring break is finally over all around, so the kids are back in school, and we can all return to focusing on the important issues facing the world such as the proper reimbursement rate for a CNA to fluff pillows or why a victim of an industrial hand amputation should only be reimbursed 50% for a pair of gloves (what if he sells the other glove on e-bay? Then he’s double dipping!)

Before I get to today’s post, quick question for you.  If a lion performing in a circus sustains injury during one of the acts, what is he to do?  Why, obviously, apply for workers’ CHOMP-ensation.  Get it? Because he’s a lion so… well, anyway.

Today I bring to your caffeinated and under-rested attention the case of Barragan v. Mission Builders Home Improvement, a panel decision recently denied review by the Court of Appeal.

The topic is, of course, everyone’s favorite: independent contractor vs. employee.  But, to add a bit of spice to the equation, not only was applicant unrepresented, the defendant was (allegedly) uninsured, dragging the Uninsured Employer Benefit Trust Fund into the mix as well!

Applicant fell through a skylight and fell twelve feet, sustaining injury to a list of body parts. At the time, he was working as a salesman and estimator.  Obviously, there was a bit of dispute as to whether this was an independent contractor arrangement, or one more befitting the title “employee.”

The matter proceeded to trial to address the issue of employment.  Applicant was trained by defendant, and was provided some equipment, while other pieces of equipment he provided himself (like a folding ladder).  He paid for his own shirts and could turn down leads and set his own schedule.  He got the luxury of using his own vehicle, and was not burdened by his generous employer with reimbursement for gas, insurance, or mileage.  Compensation was based on a commission for projects completed off of the gross profit, NOT hourly wages.

The WCJ found that applicant was an independent contractor, and he sought reconsideration, which the WCAB granted and substituted a new finding that applicant was an employee.

So, no big deal right?  Yes, big deal, because the WCJ (you know, the magistrate tasked with ascertaining credibility and observing witnesses) specifically found that the injured worker was not credible.  In footnote 4 of its opinion, the WCAB wrote that “the testimonial inconsistencies do not alter the analysis of whether applicant is an employee or an independent contractor.”

So how could the WCAB find that applicant was an employee when the WCJ determined him not to be credible?  Because, even if applicant’s testimony was completely removed from the equation, the facts provided by the defense witnesses as to the relationship between applicant and defendant sufficed to weigh the Borello factors toward a finding of employment.

So, what does that tell us on the defense side?  It doesn’t matter how poor a memory or how tattered the credibility of the applicant.  If applicant spent the entire length of the trial teaching Clams how to juggle, the evidence might still support a finding of employment.

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COA: 2012 Finding of Some Body Parts Does NOT Preclude Other Body Parts

April 14th, 2017 No comments

Happy Good Friday, dear readers!

Today I bring you an unpublished decision from the California Court of Appeal – Iniguez v WCAB/Blue Rose Concrete Contractors.

Remember, dear readers, that citing an unpublished case in California results in a public flogging, and then the Justices dance around you in a circle chanting in Latin as your body is lowered into boiling tar, only to be feathered.  Either that or you might just get sanctioned… I don’t really know anymore.

Anywho, applicant sustained an injury in 2010, alleging injury to his head, neck, back, both shoulders and lower extremities.  Among the many treatment reports produced during the case was an electro-diagnostic report indicating radiculopathy to the neck and low back.  A QME saw applicant in 2011 and opined that he had sustained injury to his left knee and right shoulder only.  As it turns out, this electro-diagnostic report was not provided to the QME for review.

The matter proceeded to a hearing before a WCJ, with defendant raising several defenses, including statute of limitations and post-termination defense.  However, the WCJ concluded, in an opinion issued in 2012, that applicant sustained a compensable injury to his knee and shoulder.

Fast forward to 2013, and applicant is re-evaluated by the QME who now reviews that electro-diagnostic report from 2010 and changes his mind – applicant DID sustain an injury to his low back and neck after all!

Well, defendant naturally takes the position that the issue of which body parts were injured was already adjudicated back in 2012, and applicant failed to seek reconsideration.  In fact, Labor Code section 5815 specifically provides that “[e]very order, decision or award … shall containe a determination of all issues presented for determination by the appeals board … [a]ny issue not so determined shall be deemed decided adversely as to the party in whose interest such issue was raised.”

Well, the WCJ ruled in favor of defendant on the issue of collateral estoppel and res judicata, and the split majority of the WCAB agreed.  However, upon seeking a writ of review, the WCAB changed its mind and asked to have the matter returned to it.

The Court of Appeal agreed with the WCAB, and further ruled that the WCJ, in ruling that applicant sustained injury to the knee and shoulder did not effectively find that applicant ONLY sustained injury to the knee and shoulder: “We have no doubt that the 2012 determinations of the WCJ was not a final award under the usual meaning of finality.”

But here’s the interesting thing: the WCJ… you know, the person that actual made the rulings, sided with defendant on the trial level.  So it seems that the WCJ at least interpreted the original finding in such a way.

In any case, the Court of Appeal remanded this down to the WCAB with the conclusion that “the finding of industrial injury to certain body parts does not preclude applicant from later presenting evidence of industrial injury to other body parts in a subsequent proceeding.

So, here’s the frustrating thing for your humble blogger – applicant had already alleged injury to these additional body parts in his application, and knew about the electro-diagnostic report from 2011 (presumably he was there when the exam was performed).  Why wasn’t applicant diligent in getting everything in front of the QME for review?  Why didn’t applicant recon the WCJ’s decision when out of a laundry list of body parts claimed only two were found compensable?

Having to advise clients or just my fellow citizens about the process can be difficult because of the perception that the bar is lower and much more forgiving for applicants than for defendants.   Let’s say defendants raised 6 affirmative defenses, and a WCJ ruled adversely to just one of them.  Could defendants take several years to gather evidence and re-litigate the remaining 5?

If the applicant was unhappy with the initial determinations by the PQME why not provide additional information?

Your humble blogger regularly sees the threat of needlessly delaying cases used to leverage more for settlement on the part of applicant attorneys.  Unfortunately, penalizing applicants or applicants’ attorneys for a lack of diligence is a far rarer sight.



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Distrubtion Moves Closer to Fully Automated Warehouses

April 10th, 2017 No comments

Happy Monday, dear readers!

In the past, your humble blogger has written about Amazon’s delivery model – avoiding human labor by delivering by drones, reducing human labor by replacing some tasks with robots, and, if necessary, avoiding the pitfalls of employment by trying to hire “independent contractors” or using the gig economy.

Now, some online shippers may be on the verge of something different – either fully or almost completely removing humanity from the warehouse.

RightHand Robotics is providing a robot that can quickly and accurately pick individual items and place them in bins or boxes.

This means that instead of bringing large bins to human workers to pick out the individual items, both steps of the process could be automated.  For many tasks, human labor will be freed up by this automation step to do tasks robots cannot yet complete.

What does that mean for us in the California workers’ comp field?

Well, for one thing, the cost of living will hopefully see a decrease as fulfillment for Amazon and everyone else will get cheaper.

But, more importantly, the nature of the labor force will likely see a shift (as appears to be the trend).  We can see more demand for high-skilled and probably less dangerous jobs such as designing and maintaining these robots, and fewer of the jobs the robots are intended to replace, such as warehouse workers.  The average wage in California might go up, and the likelihood of a claim will probably go down.

All in all, dear readers, a good thing, don’t you think?

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WCAB Again Holds “strong physical force” Qualifies as Violent Act

April 7th, 2017 No comments

Happy Friday, dear readers!

Your humble blogger encourages you to check out an excellent column by Julius Young over at on the issue of violent acts and psyche claims.

The column has to do with the recent panel decision in the matter of Madson v Michael J. Cavaletto Ranches.  Therein, a truck driver involved in an MVA claimed a psyche injury (in addition to other injuries) when he swerved on the freeway and his truck rolled over.  He was pinned in the truck.  It of course did not help matters that applicant was claustrophobic and afraid the truck would catch fire because of its full tanks of gas.  After 40 minutes or so, he was rescued and, fortunately, survived to tell the tale.

Among the issues in this case is whether the mechanism of injury constitutes a “violent act” in order to allow an increase in permanent disability based on a derivative psyche claim.  Applicant also claimed that his psyche injury was the direct result of the mechanism, rather than a compensable consequence, but let’s focus on the violent act issue.

Labor Code section 4660.1 was amended by SB-863 to eliminate increases in permanent disability (and probably temporary disability) benefits for “sleep dysfunction, sexual dysfunction, or psychiatric disorder, or any combination thereof” in compensable consequence cases.  However, subsection (c)(2) provides an exception to being a victim of a violent act or a direct exposure to a significant violent act.

The WCAB made the news not too long ago when, in the case of Larsen v. Securitas Security Services, the term “violent act” was interpreted to mean “forceful blow” and not requiring the criminal or quasi-criminal conduct of another person.

In the  Madson matter, the WCAB granted applicant’s petition for reconsideration and relied on the Larsen opinion to concluded that a violent act need not be a “volitional act set in force by a human being with at least if not intent something more than mere negligence.”

The undersigned respectfully disagrees.

Let’s start with a simple question – was it the legislature’s intent in amending the Labor Code as part of SB-863, to make it harder to file a psyche claim?  Clearly, the answer is yes – if the Legislature wanted to make compensable consequence claims as easy or easier to prosecute, then the language would have said nothing or created a presumption.  Instead, the Labor Code now raises the bar for compensable consequence psyche claims.

What effect does an interpretation of “violent act” have when it includes any “forceful blow”?  Doesn’t every single claim except a CT or perhaps the most minor of back strains fall into the category of “forceful blow”?  Every fall, every trip, every specific injury where there is forceful contact would negate Labor Code section 4660.1’s heightened requirements.

Furthermore, 4660.1 has another word to be considered: “victim.”  The exception holds that “[b]eing a victim of a violent act…” allows compensable consequence psyche claims.  And how does Black’s law dictionary define victim? “Person harmed by criminal acts, attack target.”

And, of course, let’s not forget that the term “violent act” did not original with SB-863.  “Violent act” was already in use by Labor Code section 3208.3.  In fact, Section 4660.1 incorporates the term: “violent act within the meaning of section 3208.3.”

As discussed in this prior blog post, a violent act has consistently been defined to date as a criminal or quasi criminal act by one person against another.  Forceful blow doesn’t seem to qualify.

From the looks of it, though, it appears that one of the parties has filed for reconsideration, presumably the Defendant having been newly aggrieved by the WCAB decision.  Just like the Court of Appeal’s decision in the matter of Dreher, where a published decision was necessary to confirm that a wet sidewalk was not an “extraordinary” condition, perhaps defendants will need to take this issue up to reverse a growing trend of expanding the meaning of “violent act.”

May your weekends, dear readers, be free from both violent acts and forceful blows, as your humble blogger respectfully submits the two are not one and the same.

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Drunk Driving Injuries Not Compensable For Bus Boy’s Post-Shift Drinking

April 5th, 2017 No comments

Not too long ago, your humble blogger had the privilege of representing an entity where a workers’ compensation claim had a civil component as well.  The applicant/plaintiff attorney for the case had a bit of workers’ compensation experience, but was primarily a civil attorney.  After the case was resolved, I never expected to see him again – after all, once people get a taste of workers’ compensation, that’s usually enough to send them running for the hills.

Lo and behold when I saw this gentleman at the Board again just recently, I asked him if he hadn’t had enough last time.  He said his client was a bouncer who got hurt on the job by a “bad guy,” and the “bad guy” didn’t have any money, so it was back to the bottomless well of workers’ comp.

Sure enough, in California, the employers and their insurers often serve as the proverbial whipping boys – whether at fault or not, injured workers (and sometimes, not uninjured workers too!) will squeeze and squeeze to hopefully take a mouthful away from the business and line their pockets.

Recently, the Court of Appeal denied applicant’s petition for a writ of review in the case of Carrillo v. LLG Corporation.  Therein, applicant as a bus boy who got sent home due to a slowdown at the restaurant.  He later came back in his personal clothes (and not the bus boy uniform he was wearing at work) and decided to “hang out” and drink.  He eventually got rowdy to the point where his co-workers asked him to leave, and on the drive elsewhere he got into a single-car collision.  His co-workers found a hole in his windshield and him 20-30 feet from his car, still breathing, with a BAC of 0.16%.

Now, in such a situation, some people might blame themselves for driving drunk. Some people might even be grateful that they did not kill themselves or some hapless third-party.  Of course, others will blame the employer and seek workers’ compensation benefits.

Applicant argued that drinking had been so encouraged and common place at the workplace that neither the intoxication defense or a challenge to AOE/COE should be sustained.

Fortunately for your humble blogger’s sanity, common sense ruled the day.  The WCJ ruled that there was no evidence of a special event or any particular requirement or encouragement on the part of the business to get applicant to drink.  In fact, the owner was not even there that day!

Applicant simply returned to a restaurant that was open to the public, and his presence there (and his drinking) had nothing to do with his job duties or work.

The WCAB adopted and incorporated the WCJ’s opinion and the Court of Appeal denied review.  But, of course, before we got to this wonderful result, the employer and its insurer had to bear the cost of the defense.  The fact-driven inquiry probably drained several hours of work from various employees to attend depositions or give live testimony.

Not only did the employee decide to risk his life and the life of third-party drivers and pedestrians, he continued to inflict damage on his employer with what is, in your humble blogger’s opinion, baseless and frivolous litigation.

And, for all the talk we hear every few years of reform, there seems to be no remedy or protection afforded to the defendants in cases like this – escape liability the defendant might, but scorched Earth is still scorched.

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Post-Award Sub-Rosa Leading to 0% PD AME Opinion Insufficient to Reopen

April 3rd, 2017 1 comment

Happy Monday, dear readers!

It makes your humble blogger especially happy to be able to bring you good news on a Friday – news to send you off on your weekend with a smile on your face.  Well, for every Yin there is a Yang, and so the laws of the universe dictate I greet you this Monday with news that is not so good.

Once in a while, we see a decision that makes us forget about laws and procedure, and just twitch helplessly with frustration at those results that make defendants feel that the system is rigged against them.

The recently writ denied case of City of Santa Maria v. Gowing, applicant sustained an admitted injury to his back and knee while employed as a police officer.  He received a 19% stipulated award for the back and 5% PD for the knee.  Defendant obtained sub rosa after the awards were issued and showed them to the AME, who concluded that applicant had no back disability based on the activity in the sub rosa video.

Defendant’s petition to reopen to reduce the permanent disability was denied because the WCJ concluded that there was no good cause – the requirement set by the WCJ was not only medical evidence obtained subsequent to the original decision, but “evidence of something not previously known to the WCAB that renders the original award inequitable.”  Furthermore, the WCJ applied the standard that the new evidence “could not have been discovered with reasonable diligence prior to the original hearing.”

The WCAB denied defendant’s petition for reconsideration, and the Court of Appeal denied review.

So… let’s talk about this.

If defendant’s position is taken at face value, applicant’s reporting of his symptoms to the AME were either a lie, or miraculously healed just after the stipulated award was issued.  In either case the AME concluded there was no back disability after viewing the video.

So why couldn’t defendant obtain this sub rosa video before entering into a stipulated award?  Well, why don’t private investigators knock on the doors of injured workers and tell them when and where they will be filmed?  The whole point in sub rosa is to record the injured worker when he or she thinks no one is watching.  What better time to do that than after an Award has issued and the injured worker thinks the matter is settled and no further “acting” is required?

In this case, it is apparent that the activity recorded by defendant after the issuance of the award was not consistent with the activity observed by the AME prior to the issuance of the award – hence the change in the AME’s opinions from 19% PD to 0% PD.

And you know what else? The same logic applies to not providing sub rosa video until AFTER applicant’s deposition.  The ENTIRE POINT of sub rosa video, and the reason why it is effective, is that it is a test of the applicant’s credibility.

Furthermore, let’s not forget that there is precedence in such situation to allow the defendant to reopen the case and adjust the award.  In Dunlap v. WCAB, for example (writ denied -1986), the WCAB allowed defendant to reopen a prior award based on the “new evidence” of a deposition transcript in which the medical examiner clarified his views from an earlier report.  Obviously, in that case, there was no change in applicant’s condition from before the award to the deposition.

Now, just think about the big picture for a minute – you have a case where it looks like the defendant has a supportable claim that applicant’s disability was not all he said it was.  Defendant has the sub rosa tapes and the AME’s medical opinion.  If the WCAB is not willing to let defendant reopen the case and proceed to litigate this point, what perception does this result breed in the minds of those who hear the claim of an injured worker legitimately injured?

If the WCAB is not willing to give a hearing to a defendant that presumably catches an allegedly injured worker red-handed, how does it affect our perception as citizens and voters of the workers’ compensation system as a whole?

Apparently, injured workers can stop pretending to be hurt as soon as the ink on their award is dry.

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