McWane, Inc. v. McClurg; released 3/26/2010

The Court of Appeals addressed three separate issues related to an employee’s refusal resulting in benefits being stopped during the period of refusal.

First, the employer argued that the employee refused certain psychological treatment and, therefore, compensation was not payable pursuant to §25-5-77 (b) of the Alabama Workers’ Compensation Act during the period of refusal. The employee had under gone treatment involving him returning to the accident site. After several visits the employee told his doctor that he could not do it anymore. There was some testimony that the employee refused to continue the treatment. However, the Court of Appeals found that the evidence showed the employee refused based on an inability to perform the treatment due to the anxiety it caused. Therefore, the Court of Appeals found the inability to perform certain treatment will not establish a refusal of said treatment.

Secondly, the employer argued that the employee refused vocational rehabilitation. Once again there was evidence that the employee was a candidate for vocation rehabilitation and evidence that he was not a candidate. The Court of Appeals found that if there is evidence an employee is not a candidate for vocational rehabilitation, then the refusal will not result in benefits being stopped during the period of refusal pursuant to §25-5-77 of the Alabama Workers’ Compensation Act.

Finally, the employer argued the employee refused suitable employment and benefits are not owed during the period of refusal pursuant to §25-5-57 (a) (3)e of the Alabama Workers’ Compensation Act. The Court of Appeals pointed out that this section only applies to individuals who are permanently partially disabled and not permanently and totally disabled as the employee in this case was found to be.

McWane, Inc. v. McClurg; released 3/26/2010 

The Alabama Court of Civil Appeals outlined what is required to prevail when asserting the defense of willful misconduct. The Court held that a mere violation of a rule does not establish wilful misconduct. The employer must prove that the employee committed an intentional act; that violates a safety rule known by the employee; and that the employee knows the natural, probable, and serious result of violating the rule (act involved known or obvious risk so great that harm was highly probable).

In McClurg, the employee was reaching over a guardrail while a machine was not running and jiggled a wire causing the machine to start and injuring the employee. The employer said the employee was supposed to perform a lock out procedure and it was stipulated that if this was done the injury would not have occurred. However, in this case the Court found the employee did not understand the rule prohibited his conduct. Furthermore, the Court stated that the actions of the employee were not "of an unreasonable character in disregard of a known or obvious risk that was so great as to make it highly probable that harm would follow."

The employer argued that Ex parte Bowater controlled in this matter. However, the Court distinguished that case from McClurg. In Bowater the employee knew he was not to reach into a running machine to dislodge wood. Therefore, the Court in McClurg stated that the employee’s action in Bowater involved a "known or obvious risk that was so great to make it highly probable that harm would follow." This was due to the fact that the machine in Bowater was running unlike the machine in McClurg and the employee in McClurg had pressed a stop button as well.

Therefore, if the employee intentionally acts in a manner that violates a known rule it will only be willful misconduct if the employee knows the act is of such risk that it is highly probable harm would follow.

On March 14^th, 2010 a federal judge entered a default judgment for the amount of $2,264,690.68 against 86 workers’ compensation claimants in a Racketeer Influenced and Corrupt Organizations Act (RICO) action filed by the New Jersey employer.

After being laid off due to a plant closing, all 86 former employees filed for workers’ compensation benefits and were represented by the same law firm. All employees claimed similarly vague injuries after having a medical examination. The company then served a RICO lawsuit against the employees. None of the employees responded to the complaint and, as a result, the default judgment was entered.

The Plaintiffs’ attorneys were also sued but opted to settle out of court for an undisclosed amount.

My Two Cents:

This is the first RICO case arising out of the workers’ compensation context to result in a judgment. Since it was a default judgment, none of the defenses raised in currently pending RICO cases against employers were raised. Therefore, it still remains to be seen whether RICO lawsuits arising out of workers’ compensation cases will ever make their way to a jury.

Two More Cents:

This case is interesting because it shows the 2 sides of the RICO coin. Up until now, the focus has been on RICO claims against employers, insurers, third party administrators, and doctors. We now see that the RICO statute can be used just as effectively in the other direction. The most notable difference is that an employer, insurer, administration company, or doctor can either afford to defend themselves or has insurance to defend them in a RICO claim. It is doubtful, however, that claimant employees will have the financial resources to pay for a defense in a federal RICO lawsuit. This may have been the reason for the 86 default judgments.

G.UB.MK Constructors v. Howard Lee Davis:

On March 19, 2010, the Alabama Court of Civil Appeals released this opinion wherein it reversed the trial court’s decision to remove a hand injury from the schedule. Specifically, the trial court opted to treat the injury as a body as a whole injury because the employee experienced sever pain which extended up his arm and into his shoulder, neck and upper back and effected his ability to perform the duties of his former job. The trial court additionally found that the employee suffered debilitating pain which it recognized as another reason for removing the injury from the schedule.

On appeal, the Court noted that the Drummond test for removing injuries from the schedule states "if the effects of the loss of the member extend to other parts of the body and interfere with their efficiency, the schedule allowance for the lost member is not exclusive." It was further noted that the key consideration for said test was not whether the effects of the injury impair the ability of the worker to work in his or her former occupation. Although the employee testified at trial that the efficiency of other parts of his body had been effected, his testimony was not supported by medical records, FCE results, or any expert testimony. Further, the Court held that, even if the effects of the hand injury extended to the other areas of the body as stated by the employee, the record contained no evidence that said effects hindered or impeded the effective functioning of those areas of the employee’s body. As such, the Court reversed the trial court’s decision to remove the injury from the schedule based on the Drummond test.

The Court also noted that pain, in and of itself, can qualify as a reason for removing an injury from the schedule. In this case, the trial court held that the employee had "debilitating" pain. However, the Court noted that the employee must establish that his pain is "totally, or virtually totally, physically disabling" in order for the pain exception to apply. As such the trial court’s decision to remove the injury from the schedule based on pain was also reversed.

Norandal U.S.A. Inc. v. Graben

released 3/12/2010

This was the second time Norandal U.S.A. Inc. v. Graben came before the Court of Appeals. A summary of the previous holding is located in the Scheduled Injury section of this blawg.

The issues resulting in a second appearance before Court of Appeals were whether or not an altered gait or pain isolated in a scheduled member were sufficient to take the injury out of the schedule.

The Court dismissed the Trial Court’s ruling that the employer’s altered gait resulted in the injury falling outside the schedule due to the fact that the Trial Court altered its previous findings of fact. The Trial Court based its opinion on a change in case law. The Court of Appeals held that the Trial Court could not alter its findings of fact in order to issue a ruling that adheres to the new case law.

In regards to the issue of pain isolated in a scheduled member taking an injury outside the schedule, the Court of Appeals reaffirmed its previous holding. It stated that to adhere to the legislation and avoid uncertainty, a high standard must be used to find that pain isolated in a scheduled member takes the injury outside the schedule. The Court of Appeals reestablished the standard as pain that "virtually totally physically disables" the employee. They went on to state that the employee must provide competent proof that the pain completely, or almost completely, debilitates the employee. Moreover, the employee’s subjective complaints of pain must be considered and do not have to be supported by objective findings.

Judge Moore wrote a concurring opinion indicating that he does not agree that pain isolated to a scheduled member should result in an injury to the body as a whole. He stated that severe pain isolated to a scheduled member may justify finding that the employee sustained a total loss of use of the member. However, he opined that if pain is isolated to a member, it should not be treated as adversely affecting other parts of the body. Judge Moore stated that the Court of Appeals must follow the dicta indicated previously by the Supreme Court regarding the "pain exception"; however, he asked the Supreme Court to revisit the "pain exception" to the schedule and declare that it does not exist. In closing, he stated that until the Supreme Court does so, "I will continue to acknowledge that, in very limited circumstance set out in the main opinion, totally or virtually totally debilitating pain isolated in a scheduled member is sufficient to warrant an award of non-scheduled benefits."

Early last year in the Circuit Court of Etowah County, the trial judge entered judgment in favor of a plaintiff in her retaliatory discharge claim but awarded her no compensatory or punitive damages.

In the beginning of September 2004 the employee was injured while working for her employer but she did not immediately file for workers’ compensation benefits. Later that month the employee received a letter stating that she was terminated because of her recent performance and not to contact the other employees directly.

In January 2005 , the employee filed for workers’ compensation benefits and that claim was eventually settled in December of 2006. However, during this same time period, the employee also filed a retaliatory discharge claim alleging that she was fired in retaliation for filing a worker’s compensation claim. The employee also alleged that the employer breached an oral contract by not providing her with a third of the business.

After a trial on the merits, the jury found in favor of the employer on the breach of contract claim and in favor of the employee on the retaliatory discharge claim but awarded no money in either compensatory or punitive damages.

Black Creek, Inc. v. Ray Keith Wood:

On March 12, 2010, the Alabama Court of Civil Appeals released this opinion wherein it reversed a denial of a motion for a judgment as a matter of law (JML) from the Circuit Court of Etowah County and remanded the case for the trial court to enter a JML in favor of the employer. 

In February of 2000, the employee pulled a muscle loose from his left arm while working as a machinist for the employer. The injury needed surgery and, after determining that it was work related, the employer’s workers’ compensation insurance carrier authorized the surgery. The surgery was performed on May 5, 2000. On June 8, 2000 the doctor that performed the surgery released the employee to light duty work.

On June 12, 2000 the employee returned to work, but during that week his work was sporadic with his time card showing he left work early three days to attend physical therapy. The employer had a policy that required employees to attempt to schedule their doctor and physical therapy appointments either before or after work and to notify their supervisor if those arrangements could not be made. Due to his failure to report his absences and use of foul language to his supervisor the employee was issued several disciplinary warnings. On June 20, 2000, the employee became upset with his supervisor, used foul language in the presence of other employees, and left the job. 

In August of 2000, the employee filed a workers’ compensation claim and also a retaliatory discharge claim. The two claims were severed and the workers’ compensation claim was eventually settled. After a trial in December of 2007, the trial court entered judgment in favor of the employee and awarded $50,000 in damages. The employer moved for JML at the close of the employee’s evidence and also at the close of the trial and both were denied. The employer appealed.

The Court of Appeals concluded that the employer had a legitimate reason for discharging the employee and that the trial court erred in not granting the motion JML. The case was remanded to the trial court with instructions to enter JML for the employer.

Recently, a client of this law firm was presented with a situation where the authorized treating physician made a referral to a specific pain management facility. Our client felt that section 25-5-77 granted the employer the right to choose the doctor and not the authorized treating physician. The client refused to authorize the facility and the employee’s attorney filed a motion to compel and a request for sanctions. Prior to filing a response, we submitted a letter to the authorized treating physician which solicited his reasons for choosing the facility in question. We further asked him to state whether or not his choice was any better than the physician our client preferred and, if so, to explain why. In response, the doctor stated that our client’s choice was just as good as his. In our filed response, we acknowledged that prior case law had empowered doctors with the ability to make referrals to other specific doctors. However, we argued that it was assumed in the prior case that the doctor had a medical reason for making the specific referral. Since our treating physician did not provide a medical reason for choosing that particular facility, we argued that the choice should revert back to the employer as set forth in 25-5-77. After filing the response and supporting physician letter, the employee’s attorney withdrew the motion and request for sanctions and allowed our client to choose the doctor. Although this is not a reported decision, it certainly provides employers and adjustors with a blue print for retaining control of the employee’s medical treatment in the future.

Robert Cocking v. City of Montgomery:

On march 12, 2010, the Alabama Court of Civil Appeals considered the issue of whether Post Traumatic Stress Disorder ("PTSD") was compensable as an occupational disease in the absence of a physical injury. In the discovery phase, it was learned that the plaintiff was a Montgomery firefighter for 25 years. In his capacity as a firefighter, he was often called upon to respond to emergency situations. On October 3, 2005, the plaintiff failed to revive a two and a half year old baby. On June 29, 2008, he failed to revive a 52 year old woman. The plaintiff alleged in his complaint that the continuos exposure to such stressful situations caused him to develop PTSD. The employer filed and argued a motion for summary judgment based on the fact that there was no evidence of a physical injury. In Alabama, there must be physical injury in order for a mental injury to be compensable. The plaintiff conceded that there was no physical injury but argued that there was no such requirement if the mental injury was an occupational disease. The trial court granted the motion for summary judgment and the employee appealed the decision. On appeal, the Court of Civil Appeals considered the briefs and heard oral argument on the issue. The Court ultimately affirmed the trial court’s decision. In support of its decision, the Court noted that the statute defining an occupational disease specifically refers to physical diseases. As such, in order for a mental disease to qualify, it would need to meet the same physical injury requirement as an accidental injury.

My Two Cents:

This is not the first time this argument has been made. However, in prior cases, the Court of Civil Appeals decided in favor of the employer because the plaintiff did not have job duties peculiar to his or her employment that could possibly cause PTSD. This always left open the possibility that the Court could determine in a subsequent case that PTSD was an occupational disease if the plaintiff could prove his or her job duties could cause the disorder. This issue has now been resolved and the physical injury requirement remains intact even when an occupational disease is alleged.

Ex parte Nicholas Kish:

On March 5, 2010, the Court of Civil Appeals granted a Writ of Mandamus ordering the Trial Court to grant the employees Motion to Compel a panel of four surgeons.

The employee was sent to an authorized treating physician who referred him to numerous doctors for several injuries. One referral was to an orthopedic surgeon for a knee injury and another was to a neurologist for a head injury. The employee underwent 2 knee surgeries while also being treat for a concussion by the neurologist. The neurologist went on to refer him to another doctor and, at some point, the employee requested a panel of four neurologist, which was given by the employer.  Subsequently, the orthopedic surgeon recommended another surgery and the employee requested a panel of four surgeons. The employer took the position that he was not entitled to another panel of four and the Jefferson County Circuit Court agreed.

As a result, the employee filed a Petition for a Writ of Mandamus seeking an Order that forced the trial court to grant the employee’s motion to compel a panel of four surgeons. The Court of Appeals agreed with the employee and states that §25-5-77 (a) of the Alabama Workers’ Compensation Act states that an employee is entitled to a panel of four "physicians" and is also entitled to a panel of four "surgeons" if surgery is recommeded.

My Two Cents: 

This case did not state that the claimant has a right to two panels and it did not address the situation where the first panel request is for a surgeon.  Although the Court correctly points out that not all physicians are surgeons, it is safe to say that all surgeons are physicians,  For this reason, it can be argued that, if the first request is for a surgeon, then the claimant has used up both of his requests.  Therefore, it is important to have the claimant or his/her attorney put in writing whether the first request is for a physician or a surgeon.