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(c) 2010-2024 Jon L Gelman, All Rights Reserved.

Wednesday, October 26, 2011

Employee Allowed to Sue Employer for Negligence Resulting From an Occupational Exposure

Guest Blog by John R. Boyd

A Court of Appeals in Missouri has ruled that an employee, who became ill as a result of an occupational exposure to asbestos fiber, may sue his employer for negligence. The Court ruled that the limitations on recovery of the Workers' Compensation Act did not bar a claim where an occupational exposure occurred.

On September 13, 2011, the Court of Appeals for the Western District of Missouri issued a very rare en banc opinion on a writ of prohibition allowing the employee's claim to go forward. The ill worker was exposed to asbestos, a known cancer causing agent, while working for KCP&L Greater Missouri Operations Company (KCP&L)  from 1954 to 1988 and was diagnosed with mesothelioma in 2010. Mesothelioma is a rare, but fatal, asbestos related disease.

His claims against his employer, KCP&L,  relied upon premises liability and negligence theories. The employee alleged that KCP&L had a duty to exercise "reasonable care" in preventing an "unreasonable risk of injury."   KCP&L argued that the Missouri Workers' Compensation Act was his exclusive remedy, and sought summary judgment, which was ultimately denied by the trial court.

The Appeals Court held in its 7-2 opinion, that a strict reading of the  Missouri Statutes §287.020.2 and §287.120 defeated KCP&L's argument that the claimant's occupational disease was covered by the Act, and that workers' compensation was the employee's exclusive remedy available. The Court reasoned that the 2005 amendments to the Missouri Workers' Compensation Act required a "strict construction" of the Act. 

The exposure at work was deemed not to be a specific accident, but rather a continuous occupational exposure over 34 years. The Appeals Court differentiated the occupational exposure to asbestos from a specific accident that is defined as "an unexpected traumatic event or unusual strain identifiable by time and place of occurrence and producing at the time objective symptoms of an injury caused by a specific event during a single work shift."

The Court's ruling opened the door for this worker and others who have been exposed in such a fashion to pursue a lawsuit against his or her employer directly, and not be constrained by the limited economic bounds of the Workers' Compensation Act.

This change in the law came about as a result of previous aggressive actions by business and industry to modify the Missouri Workers' Compensation Act in an to attempt to eliminate claims. The ultimate lesson to be learned is that when a pro-business Legislature deforms the law, and attempts to carve-out certain types of injuries from being compensable, they force such cases into the civil arena. Be careful what you ask for----you just might get what you deserve.

Following the Appeals Court's  ruling, an Application for Transfer to the Missouri Supreme Court was filed by counsel for the appellant's on 9/27/11. No ruling on the transfer request has been made by the Missouri Supreme Court.

State ex rel KCP&L Greater Missouri Operations Company v. Hon. Jacqueline Cook WD73642 2011 WL 4031146 (Mo.App. W.D.) (September 13, 2011)

John R. Boyd  is President of the Workers' Injury Law and Advocacy Group (WILG). He is the managing partner of Boyd & Kenter, P.C., Kansas City, MO, and is licensed to practice in Missouri, the United States Court of Appeals for the Eighth Circuit; and the United States District Court for the Western District of Missouri. He is currently a member of the Missouri Bar Association, the Kansas City Metropolitan Bar Association (Chairman of the Workers' Compensation Committee 2000-2001), the Missouri Association of Trial Attorneys (MATA), and the American Association for Justice. 
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Sense of Injustice, Occupy Wall Street & A Tornado Survivor From Joplin

In a dramatic turn of events based upon pubic outrage, a insurance company has reversed its decision and now decided to provide workers' compensation benefits to a first responder who was injured while providing assistance to tornado victims in Joplin, Missouri.


Mark Lindquist saved 3 development disabled adults in Joplin following the tornado that devastated that community. Caught in the he 200 mile an hour tornado, Lindquist lost all of his teeth, was in a coma for several months and ran up medical bills amounting to $2.5 Million. The insurance company initial had denied the claim and recent news reports and public outrage resulted in a reversal by the insurance company on the issue of compensability.


The same outrage against Corporate America and an imbalance in the socio-economic system is now being reflected in the Occupy Wall Street movement. Recently Amy Goodman commented about the growing recognition of injustice on the Charlie Rose show. 

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Florida Deems NCCI Rate Request Flawed

Florida ruled that the rate request from NCCI (National Council on Compensation Insurance, Inc.) was based on a flawed calculation. Nevertheless, the State of Florida did rule that the workers' compensation rates would increase 8.9% effective January 1, 2012.

"Commissioner McCarty’s Order is technically a denial of NCCI's rate filing. The Office did not accept NCCI’s methodology for input parameters including policyholder dividends, the loading for these dividends, and investment yields. The Office also did not accept specific rate changes for certain classes, specifically the "F" classes for workers covered by the Federal Acts, classification code 5551 (roofers), and classification code 7705 (Ambulance and EMS providers). The Office also disapproved the proposed increase in minimum premiums."

The Sunshine State has take a very serious economic downturn following the collapse of the real estate market over the past few years. When one drives through southern Florida you can detect that the only industry that is booming is the signage companies that print the "For Lease" and "For Rent" signs that have proliferated throughout the region.

NCCI provides rate information for the majority of States where workers' compensation is written. The availability of rating data is somewhat restricted. 

The news of increased workers' compensation rates, compounded by recent real estate taxes increases, is not good news for the staggering Florida economy that by luck this year missed the impact of severe hurricane season. Should that change in 2012, the increased to be assessed in 2012 may produce a defining moment for the  entire workers' compensation program in that state.
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Monday, October 24, 2011

Insurance Agent Charged With Theft of $255,000 of Work Comp Premiums

Agents from the Pennsylvania Attorney General's Insurance Fraud Section have filed criminal charges against a Berks County man accused of the theft of more than $255,000 in workers' compensation insurance premiums.

Attorney General Linda Kelly identified the defendant as Joseph A. Maurer, 58, of 2558 Welsh Road, Mohnton. Maurer owned and operated Commonwealth Professional Group, a former insurance agency located in Reading, Berks County.

According to the criminal complaint, Maurer is accused of taking more than $188,000 in premiums paid by four municipal governments, including Bally Borough and South Heidelberg Township, located in Berks County, along with Salisbury Township in Lehigh County and Earl Township in Lancaster County. The money allegedly paid to Maurer by all four municipalities was supposed to be forwarded to Pennprime Insurance Trust, of Harrisburg, as payment for workers compensation coverage.

Additionally, Maurer allegedly misdirected premium payments for at least five other policies purchased through his agency, totaling in excess of $67,000 that was supposed to be forwarded to Travelers Insurance and ACE American Insurance Company on behalf of various clients.

Maurer is charged with three counts of theft by failure to make required disposition of funds received, all third-degree felonies which are each punishable by up to seven years in prison and $15,000 fines.

Maurer was preliminarily arraigned on October 12th before Reading Magisterial District Judge Phyllis J. Kowalski and released on $850,000 unsecured bail. He was also ordered to surrender his passport.

A preliminary hearing for Maurer is scheduled for November 9th, at 1:30 p.m., before Magisterial District Judge Kowalski.

The case will be prosecuted in Berks County by Deputy Attorney General John T. Dickinson of the Pennsylvania Attorney General's Insurance Fraud Section.
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Saturday, October 22, 2011

A Proposal To Make The Workplace Safer

Jason Bent, Professor at Stetson University, has published an incentive-based proposal to regulate workplace chemicals through the nation's workers' compensation system. 

Abstract: 
"Our system for regulating employee exposures to hazardous chemicals is broken. There is a recognized market failure in the market for workplace safety regarding exposures to potentially hazardous chemicals. Information asymmetries, long disease latency periods, and other characteristics of chemical exposures allow employers and chemical manufacturers to externalize much of the expected cost of workplace exposure. The current U.S. regulatory system, including both Occupational Safety and Health Administration regulations and state workers’ compensation programs, is failing to correct the market failure. The result is a level of chemical exposure risk that is systematically too high, and a level of precaution that is systematically too low.

"The proposed reforms offered to date in the employment and environmental law literature are lacking, primarily because they do not sufficiently address the underlying financial incentives of the true least-cost information providers and least-cost risk avoiders: chemical manufacturers and employers. This article takes the search for a solution to the workplace disease problem in a new direction by capitalizing on the incentives of chemical manufacturers and employers. My proposal would amend state workers’ compensation laws in two ways: (1) shift the default burden of proof on the element of causation onto the respondents, in cases where there is no regulatory exposure limit governing the substance in question, and (2) allow employers to include chemical manufacturers as respondents in workers’ compensation claims for purposes of apportioning liability. These amendments could be implemented by convening a new National Commission on State Workers’ Compensation Laws. By focusing on the financial incentives of chemical manufacturers and employers, this proposal will spur the production of chemical toxicity information and lead to adequate compensation for employees who suffer exposure-related illnesses and diseases.


Click here to read the entire report.
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Government Appeals Case Involving MSP Statute of Limitations

A Notice of Appeal has been filed by the United States in a case where a Federal District Court held that the statute of limitations in a Medicare Secondary Payer Act recovery action was limited to only 6 years. The government contented in the matter that the statute of limitations for it to assert recovery/reimbursement was extended under the "implied contract theory."

The case was tried in the U.S. District Court, Northern District of Alabama (Eastern) before Judge Karon O. Bowdre and involved a contract reimbursement claim under the Medicare Act, specifically 425 USC 1395 (HHS). A Final Order was entered on September 13, 2011 the the United States filed a Notice of Appeal on October 11, 2011.

Read the prior posting: CMS Has 6 Year Statute of Limitations-Court Dismisses MSP Recovery Claim 10.1.2010

United States of America v James J. Stricker, et al., CV 09-BE-2423-E (USDCT ND Alabama)
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Fracking: US EPA To Develop Natural Gas Waterwaste Standards

The U.S. Environmental Protection Agency (EPA) is announcing a schedule to develop standards for wastewater discharges produced by natural gas extraction from underground coalbed and shale formations. No comprehensive set of national standards exists at this time for the disposal of wastewater discharged from natural gas extraction activities, and over the coming months EPA will begin the process of developing a proposed standard with the input of stakeholders – including industry and public health groups. Today’s announcement is in line with the priorities identified in the president’s Blueprint for a Secure Energy Future, and is consistent with the Secretary of Energy Advisory Board recommendations on steps to support the safe development of natural gas resources. 

"The president has made clear that natural gas has a central role to play in our energy economy. That is why we are taking steps -- in coordination with our federal partners and informed by the input of industry experts, states and public health organizations -- to make sure the needs of our energy future are met safely and responsibly,” said EPA Administrator Lisa P. Jackson. "We can protect the health of American families and communities at the same time we ensure access to all of the important resources that make up our energy economy. The American people expect and deserve nothing less."

Recent technology and operational improvements in extracting natural gas resources, particularly shale gas, have increased gas drilling activities across the country. Production from shale formations has grown from a negligible amount just a few years ago to almost 15 percent of total U.S. natural gas production and this share is expected to triple in the coming decades. The sharp rise in domestic production has improved U.S. energy security and created jobs, and as with any resource the administration is committed to ensuring that we continue to leverage these resources safely and responsibly, including understanding any potential impact on water resources.

Shale Gas Standards:
Currently, wastewater associated with shale gas extraction is prohibited from being directly discharged to waterways and other waters of the U.S. While some of the wastewater from shale gas extraction is reused or re-injected, a significant amount still requires disposal. As a result, some shale gas wastewater is transported to treatment plants, many of which are not properly equipped to treat this type of wastewater. EPA will consider standards based on demonstrated, economically achievable technologies, for shale gas wastewater that must be met before going to a treatment facility.

Coalbed Methane Standards:
Wastewater associated with coalbed methane extraction is not currently subject to national standards for being directly discharged into waterways and for pre-treatment standards. Its regulation is left to individual states. For coalbed methane, EPA will be considering uniform national standards based on economically achievable technologies.

Information reviewed by EPA, including state supplied wastewater sampling data, have documented elevated levels of pollutants entering surface waters as a result of inadequate treatment at facilities. To ensure that these wastewaters receive proper treatment and can be properly handled by treatment plants, EPA will gather data, consult with stakeholders, including ongoing consultation with industry, and solicit public comment on a proposed rule for coalbed methane in 2013 and a proposed rule for shale gas in 2014.


The schedule for coalbed methane is shorter because EPA has already gathered extensive data and information in this area, EPA will take the additional time to gather comparable data on shale gas. In particular, EPA will be looking at the potential for cost-effective steps for pretreatment of this wastewater based on practices and technologies that are already available and being deployed or tested by industry to reduce pollutants in these discharges.


This announcement is part of the effluent guidelines program, which sets national standards for industrial wastewater discharges based on best available technologies that are economically achievable. EPA is required to publish a biennial outline of all industrial wastewater discharge rulemakings underway. EPA has issued national technology-based regulations for 57 industries since 1972. These regulations have prevented the discharge of more than 1.2 billion pounds of toxic pollutants each year into US waters.


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