Thank you for taking the time to read our Firm newsletter. Our newsletter provides a monthly update on recent developments within our Firm, as well as in the insurance defense community.

In the News
Lee + Kinder is pleased to introduce the newest members of our team, Ms. M. Frances McCracken and Mr. John M. Abraham.  Fran and John both join us as Of Counsel, bringing with them a combined 33 years of experience in insurance litigation defense.  We welcome them to our growing Lee + Kinder family.  For a more in depth look at our newest members, please follow the links above to visit their biography pages on the Lee + Kinder website.

Victory Lap

Member Katherine Lee successfully challenged two claims for workers’ compensation benefits which were consolidated for a single hearing in Schum v. John Crane, Inc. and Liberty Mutual Insurance, W.C. Nos. 4-944-662 and 4-944-671.  Claimant claimed that he suffered from various physical ailments as the result of exposure to alleged radiation.  Claimant also claimed that he suffered repetitive motion injuries from his work cleaning equipment.  At hearing, Respondents focused on the absence of medical evidence of any injury, whatsoever, or the presence of any harmful radiation in Claimant’s workplace.  The ALJ found that Claimant presented no evidence that he had been exposed to any significant levels of radiation or that he had sustained any injury as the result of repetitive motion.  The ALJ also noted that medical testing suggested the possibility that malingering may be a significant factor in Claimant’s complaints of injury.  The ALJ found in favor of Respondents and denied and dismissed both claims.

Of Counsel Joe Gren enjoyed noteworthy success in obtaining a directed verdict denying compensability of a claim for mental impairment in Tharldson v. United Parcel Service and Liberty Mutual Insurance, W.C. No. 4-961-204.  Claimant alleged that he suffered from mental impairment as the result of his new duties as a package car driver.   Under the Act, a claim for mental impairment is only compensable where supported by the testimony of a licensed physician or psychologist and where the employee can show that the impairment arose out of a psychologically traumatic event generally outside of a worker’s usual experience.  Respondents argued, and the ALJ agreed, that Claimant’s claim for mental impairment arose out of an experience common to all package delivery drivers.  With this factual finding, Claimant could not meet his burden.  Respondents therefore moved for a directed verdict at hearing, which the ALJ granted.  Claimant’s claim was denied and dismissed.


The Colorado Governmental Immunities Act: The 180 Day Ticking Time Bomb for Filing a Subrogation Personal Injury Lawsuit

When the “somebody” who caused an injury to an injured employee is a state governmental entity, a workers’ compensation insurance carrier must take specific measures at the onset of the injury in order to protect their respective subrogation rights. A party’s failure to follow the specific statutory time frames established by the Colorado Governmental Immunities Act (“CGIA”), section 24-10-101, C.R.S., will result in any personal injury claim being time barred:Maestas v. Lujan, 351 F.3d 1001 (10th Cir. 2003). The most important step an insurance carrier or employer can take at the onset of a subrogation claim is to file the appropriate notice of claim with a governmental entity.  The notice must be filed within 180 days after the injury.  Click here to learn how to properly file a notice of claim consistent with the CGIA.

Cases You Should Know 

Just say what you mean: Settlement documents will be afforded their plain meaning. Heckler v. Wern Air, Inc., and Pinnacol Assurance, W.C. No. 4-877-223-04 (ICAO, December 16, 2014), involved a full and final settlement agreement entered into by the parties. Prior to the settlement, Claimant requested payment of outstanding TPD benefits. The parties then reached settlement. Following approval of the settlement, Claimant filed an Application for Hearing stating he believed Respondents would pay for the TPD benefits regardless of the status of settlement. The ALJ denied the claim for TPD benefits on multiple grounds: the claim was closed by the parties’ settlement; Claimant had reached the cap on combined benefits; and TPD could not be collected for lost wages after the date of MMI.  On appeal, Claimant argued that the settlement agreement was ambiguous as to whether the TPD claim was included among the issues being settled.  Claimant relied on a paragraph in the settlement documents as being ambiguous to the extent that a reasonable interpretation would hold that the Respondents agreed to pay the TPD claim.  The ICAO held that given the plain meaning of the settlement language in question, Claimant accepted $25,000 to settle all claims for money to which the Claimant “might” be entitled and for which Claimant has not already been paid.The Colorado Court of Appeals recently visited this issue in a separate decision. In Kathleen Bopp v. ICAO and Garden Square Assisted Living, W.C. No. 4-893-767 (Colo. App. 2015) (nsfop), the Court of Appeals affirmed that settlement agreements are enforced. The parties entered into a settlement agreement in July 2012 resolving Claimant’s April 2009 low back injury claim. Three weeks after finalizing the settlement agreement, Claimant filed a new claim for a back injury in April 2012, which allegedly was caused by chiropractic treatment for the 2009 claim. Respondents filed a Motion for Summary Judgment, arguing that Claimant’s spine claim was barred by the parties’ settlement agreement.   The ALJ granted summary judgment in Respondents’ favor and dismissed Claimant’s claim for her April 2012 back injury. ICAO affirmed the ALJ’s decision upon review.  Claimant appealed, primarily on the basis that the settlement was limited to a date of injury of April 12, 2009.  Claimant did not dispute that her alleged back injury occurred while being treated for her work-related injury, her argument instead was that the parties never intended the back injury to be included in their settlement.  The Court found that the parties’ settlement agreement expressly encompassed Claimant’s chiropractic injury.  When the language used in a settlement agreement is “plain clear and no absurdity is involved, a court must enforce the instrument as written.” Cary v. Chevron U.S.A., Inc., 867 P.2d 117, 119 (Colo. App. 1993).  The Court held that Claimant, in this instance, was barred by the terms of the settlement agreement from bringing a separate claim for her back injury.

Use it or lose it: All issues must be raised prior to the ALJ’s Order. Angel Montes v. MDT Personnel, LLC, and Guarantee Insurance Co. / Patriot Risk Services, W.C. No. 4-913-144-01 (ICAO, December 16, 2014).  Here, Claimant sought a review of an Order from ALJ Cain that denied and dismissed his claim for benefits.  After the hearing, the ALJ found that the Claimant failed to satisfy his burden of proving he sustained a compensable knee injury.  The ALJ further found that the Claimant failed to prove he sustained an occupational ankle disease by the conditions of his employment. On appeal, Claimant argued that the ALJ erred in failing to amend the pleadings to conform to the evidence, which supported an occupational disease of his right knee.  On appeal, ICAO affirmed the denial of compensability, and found that Claimant’s failure to raise the issue of an occupational disease to his right knee prior to the time of the ALJ’s order resulted in a waiver of that argument. See, Hanna v. Print Expediters, Inc., 77 P.3d 863, 865-66 (Colo. App. 2003).  Further, ICAO held that to the extent Claimant did preserve the issue, the ICAO was not persuaded to disturb the ALJ’s order.  The ICAO will not reweigh the evidence and substitute their judgment for that of an ALJ.

Take my wife…please!: Detailed medical records prevail over spousal testimony. In Gilbert Padilla v. Wal-Mart Stores, Inc., and New Hampshire Insurance Company, W.C. No. 4-905-664 (ICAO, December 22, 2014), Claimant initially underwent a hearing before ALJ Stuber on August 28, 2013.   During the first hearing, Claimant attempted to have his wife testify as a rebuttal witness regarding Claimant’s medical treatment. ALJ Stuber did not allow Claimant’s wife to testify and entered an Order denying and dismissing the Claimant’s claim for compensation benefits. On appeal, Claimant argued that ALJ Stuber abused his discretion in preventing him from presenting the proffered rebuttal testimony of his wife.  On February 12, 2014, ICAO entered an Order setting aside ALJ Stuber’s Order.  A second hearing was held on July 22, 2014 in front of ALJ Walsh.  ALJ Walsh entered a new Order, again finding that Claimant failed to prove by a preponderance of the evidence that he suffered an injury on November 9, 2012, arising out of the course and scope of his employment.  Ultimately, ALJ Walsh found the rebuttal testimony of Claimant’s wife to be less credible than the detailed notes in the medical records. On review, Claimant argued that ALJ Walsh abused his discretion by limiting rebuttal testimony from his wife to the initial offer of proof he made at the prior hearing.  ICAO held the Claimant failed to demonstrate that ALJ Walsh abused his discretion by limiting rebuttal evidence from his wife to that offer of proof he originally made at the hearing before ALJ Stuber.  Further, ICAO held that Claimant never made an offer of proof that his wife would offer rebuttal testimony to anything except the specific medical treatment in question.  Additionally, ICAO noted Claimant had adequate time prior to the second hearing to introduce additional rebuttal testimony from his wife.

Don’t know nothing ‘bout MSAs: An Administrative Law Judge has no jurisdiction over the enforcement of MSAs or employment agreements.  InSavidge v. Air Wisconsin, W.C. 4-620-669-01 (ICAO, December 29, 2014), Claimant sought review of her full and final settlement which contained a MSA. Claimant stated that her condition had changed since she agreed to the settlement and that she was unable to administer the MSA herself.  Claimant therefore requested that the settlement agreement be modified to include professional administration of the MSA. ICAO noted that an ALJ has no jurisdiction to order relief from enforcement of a Medicare Set-Aside Agreement (MSA) attached to a previously approved settlement agreement. W.C.R.P 7-2(A)(1) provides that parties are to use the settlement agreement drafted by the Director.  This Rule explains that paragraphs 9(A) and 9(B) may be modified by the parties: paragraph 9(A) may be used by the parties to include other terms that involve issues that fall within the Workers’ Compensation Act.  Paragraph 9(B) is also left blank and may be used for the parties to insert terms regarding MSA agreements, employment agreements, or waivers of bad faith claims. However, Rule 7-2(A)(1) excludes terms or agreements referenced in paragraph 9(B) from being part of the settlement agreements and therefore not subject to the jurisdiction of the ALJ.  In this case, the ALJ noted, and ICAO upheld, that approval of the settlement agreement does not constitute approval of the MSA agreement.  In this particular case, the MSA terms were referenced in paragraph 9(B) and therefore were not part of the settlement agreement and could not be reviewed by an ALJ.

Contrary to what you read online, Wikipedia is not persuasive evidence: A physician opinion is persuasive to support all PTD findings when determining permanent work restrictions. In Wallace v. Current USA, Inc. and Pacific Indemnity Company, W.C. 4-886-464 (ICAO, December 24, 2014), Claimant sought a review of a denial of PTD benefits.  The ALJ found the Functional Capacity Evaluation (FCE) to be less persuasive than other evidence.  The ALJ noted that no physician verified the accuracy of the proposed FCE work restrictions. Furthermore, the individual conducting the FCE was not a physician and was not trained pursuant to the workers’ compensation guidelines pertinent to causation, and based her findings on among other things, an article from Wikipedia.  An ALJ may consider a wide variety of factors in determining whether a claimant is permanently and totally disabled and this is ultimately an issue of material fact. The ALJ determined Respondents’ vocational expert provided credible and thorough market research and a reliance on the work restrictions recommended by two physicians in the claim. ICAO determined substantial evidence supported the ALJ’s findings an upheld the denial of PTD benefits.

If it doesn’t fit, you must not admit: Even when medical benefits have been awarded, Respondents can still contest specific treatment.  Even if there is a general award of medical benefits in a claim, respondents can contest any individual medical treatment.  This denial may be based on the benefits being unauthorized, unreasonable, unnecessary or not related to the claim. In Wilson v. H. S. Construction, W.C. 4-472-849-11 (ICAO, December 22, 2014), Claimant had been involved in a compensable motor vehicle accident (MVA) wherein he incurred an injury to his femur and pelvis. Claimant complained of headaches and requested that Respondents pay for medical care to treat his head and cervical spine. Two physicians determined that it was improbable that the headaches were caused by a cervical spine injury or head injury as a result of the MVA, but rather more likely the headaches were a result of pre-existing conditions. One other physician opined that the headaches were a product of the MVA because they were a product of the MVA aggravating a pre-existing condition.  The ALJ cited case law noting that the mere admission that an injury occurred and treatment is needed cannot be construed as a concession that all conditions and treatment that occur after the injury, were caused by the injury.  HLJ Management Group, Inc. v. Kim, 804 P.2d 250 (Colo. App. 1990).  Also, the fact that Respondents had previously paid for some headache treatment did not change the results.  It has been generally held that payment of medical services is not itself an admission of liability.  C.R.S. §8-43-210; Ashburn v. La Plata School District, W.C. 3-062-779 (May 4, 2007).

No representation without supplementation: Although Respondents are required to provide medical records for the DIME, if Respondents fail to adequately do so, Claimant may supplement DIME records.  Claimant sustained admitted injuries to her left upper extremity and low back in  Solis v. Industrial Claim Appeals Office, W. C. 4-795-922 & 4-800-423, (December 24, 2014) (nsfop). Claimant sought a review of the decision that Respondents overcame the findings of the DIME.  The ALJ credited the opinion of Respondents’ IME physician, and found by clear and convincing evidence that the DIME physician incorrectly provided an impairment rating for the spine.  Furthermore, the ALJ found that the IME physician’s findings were corroborated by Claimant’s authorized treating provider (ATP).  The ALJ found that the ATP and IME physician provided credible evidence. Claimant argued there was an incomplete record for review because Respondents did not provide all medical records to the DIME. The ALJ found that Claimant waived this argument because the Claimant herself could have provided supplemental records or cancelled the DIME if she felt there were not adequate records.  The Workers’ Compensation Rules of Procedure provide adequate measures for Claimant to address Respondents’ failure to provide all medical records to the DIME physician. Claimant failed to take any measures prior to the DIME, so she waived this argument. ICAO noted Claimant could have also deposed the DIME doctor but failed to do so.

The 180 Day Ticking Time Bomb

The Colorado Governmental Immunities Act: The 180 Day Ticking Time Bomb for Filing a Subrogation Personal Injury Lawsuit
– Joseph W. Gren, Esq.

Professor Alan Dershowitz, a hailed legal commenter and constitutional scholar, once remarked that “every lawsuit results from somebody doing something wrong. If everybody did right, we wouldn’t need laws.” In Colorado, the Workers’ Compensation Act provides an employer and insurance carrier the right to sue a “third party” when that respective third party causes injuries to an employee. Section 8-41-203, C.R.S. Though most insurance carriers and claims examiners are generally familiar with the “right of subrogation,” there are several areas of workers’ compensation subrogation that are often times thorny, especially when the government becomes involved.

When the “somebody” who caused an injury to an injured employee is a state governmental entity, a workers’ compensation insurance carrier must take specific measures at the onset of the injury in order to protect their respective subrogation rights. A party’s failure to follow the specific statutory timeframes established by the Colorado Governmental Immunities Act (“CGIA”), section 24-10-101, C.R.S., will result in any personal injury claim being time barred: Maestas v. Lujan, 351 F.3d 1001 (10th Cir. 2003). The most important step an insurance carrier or employer can take at the onset of a subrogation claim is to file the appropriate notice of claim with a governmental entity.

Generally, the CGIA permits the government to be sued for damages arising out of personal injury claims in limited circumstances. This concept is known as a waiver of governmental immunity. Though the jurisprudential theory underpinning why the government enjoys such a unique perk is significant, it is more important to understand how this law practically works. The first step in determining whether the CGIA applies to your case is to determine whether a governmental agency or employee caused, or was involved in causing, the injury to an insured’s employee.

Commonplace examples of personal injury claims involving a governmental entity include injuries caused by dangerous conditions, such as slip and falls on ice found on the grounds of governmental facilities – schools or parks maintained by a municipality, city or state. See, also Reynolds v. School District No. 1 Denver, 69 F.3d 1532 (10th Cir 1995). More subtle instances of entities who may claim protections under the CGIA include physicians whom are associated with state teaching intuitions, but work at medical facilities conducting surgeries. Rudnick v. Ferguson, et. al., 179 P.3d 26 (Colo. App. 2007). State hospitals and its employees also enjoy the protections of the CGIA. Injuries caused by a federal governmental entity or employee implicate the Federal Tort Claims Act. 28 U.S.C., Chapter 17. It is important to distinguish between state and federal entities at the onset of the claim to determine which notice provisions apply in your case.

Once the governmental entity or employee is identified, any party seeking damages, including damages provided under the subrogation statute, must provide the entity notice consistent with the CGIA. Notice of a claim must be sent in writing within “one-hundred and eight-two days” after the “discovery of the injury, regardless of whether the person then knew of all elements of claim or of a cause of action for such injury.” Section 24-10-109(1). As a general rule, most familiar with the CGIA use 180 days as the notice deadline. It is critical to file the written notice within 180 days after the employer or carrier has reasonable or actual notice of a workers’ compensation injury. Failure to provide a claim notice within the 180 day window will result in the claim being barred by the CGIA, as has happened in a number of cases. Once a trial court dismisses a claim as a result of untimely notice, the appeals courts usually provide no sympathy to a CGIA claimant.

The case of The City and County of Denver v. Crandall, 161 P.3d 627 (Colo. 2007) is illustrative of the harsh realities of not meeting the 180-day notice deadline. In that case, customer service agents working for an airliner at DIA alleged an environmental exposure injury caused by the poor air quality in Concourse B. The employees manifested symptoms consistent with the exposure in 1999 through 2002. In 2002, one employee filed a workers’ compensation claim alleging a 1999 date of injury. Multiple injured employees then filed notice of a CGIA claim with the City of Denver. The city claimed that the notice should have been filed within 180 days from the 1999 date of injury as noted on the workers’ compensation claim form. Although the employees demonstrated recurring symptoms in 2002, the Colorado Supreme Court barred the claim against the city on the grounds that the notice should have been filed in 1999. The employees were unable to recover damages against the city. The case, however, does not address whether a workers’ compensation carrier would be able to file a timely CGIA claim if the carrier found out about the injury in 2002. However, it does imply that the 180-day requirement starts ticking when a party, perhaps even the employer, has reasonable evidence that an injury has occurred.

The CGIA also requires that the notice contain specific language. Section 24-10-109(2)(a)-(e), C.R.S. provides that the claim notice requires: (a) the name and address of the claimant and the name and address of his attorney, if any; (b) a concise statement of the factual basis of the claim, including the date, time, place, and circumstances of the act, omission, or event complained of; (c) the name and address of any public employee involved, if known; (d) a concise statement of the nature and the extent of the injury claimed to have been suffered; (e) a statement of the amount of monetary damages that is being requested. As a workers’ compensation carrier, the carrier or employer who carries the loss can be considered the “claimant,” as described in section (a). Since the exposure for a workers’ compensation claim may be unknown until several years after the injury, the notice of damages should contain a statement of generalized monetary figures or allegations. The courts often times strictly enforce what is statutorily required to be in the notice. Hamon Contractors, Inc., Carter and Burgess, Inc., 229 P.3d 282, (Colo.App.2009). Though you may serve the written notice within 180 days, failure to include a statement of circumstances of the event, for example, can result in a bar to the claim.

Finally, the written notice must be served with the proper governmental entity. According to the CGIA, “[i]f the claim is against the state or an employee thereof, the notice shall be filed with the attorney general. If the claim is against any other public entity or an employee thereof, the notice shall be filed with the governing body of the public entity or the attorney representing the public entity. Such notice shall be effective upon mailing by registered or certified mail, return receipt requested, or upon personal service.” Section 24-10-109(3)(a). Additionally, subsection (b) states that a “notice required under this section that is properly filed with a public entity’s agent listed in the inventory of local governmental entities pursuant to section 24-32-116, is deemed to satisfy the requirements of this section.” Each governmental agency may have a different division or department designated to receive CGIA claims notices, such as a city attorney or a county clerk. It is advisable to contact the agency several weeks before the notice due date to obtain the name, address and division for the department designated to accept claim notices.

This article only scratches the surface of the CGIA’s complexities. But the most critical aspect of the CGIA, and the greatest obstacle in governmental subrogation recovery, is filing a claim against a government with the 180-day timeframe. Claims against the government can be won and lost depending on whether the timely notice has been met. If the timeframe is not met, the governmental “somebody doing something wrong” entity or employee will be granted immunity under the law even if the government is 100% at fault.

legaLKonnection Firm Newsletter – January 2015

Thank you for taking the time to read our Firm newsletter. Our newsletter provides a monthly update on recent developments within our Firm, as well as in the insurance defense community.

In the News

Lee + Kinder is proud to sponsor the Professionals in Workers’ Compensation’s 6th Annual Bowling Cup on Friday, February 13, 2015 at Arapahoe Bowl.  We hope you can join us!  For additional information and to register individually or as a team, visit the PWC website..

Victory Lap

Member Josh Brown successfully prevented a claimant from pursuing further workers’ compensation benefits for a back injury under a new claim after settling an existing claim for a shoulder injury in Bopp v. ICAO, Garden Square Assisted Living and Liberty Mutual Insurance Group, W.C. No. 4-893-767 (Colo. App. 2015) (nsfop). Claimant suffered an admitted injury to her right shoulder in 2009 and consequently underwent treatment with a chiropractor, which she alleged caused an injury to her low back.  The parties agreed to full and final settlement of the claim in 2012, which included all other disabilities, impairments, or conditions related to the shoulder injury, including injuries unknown at that time.  After settlement was approved, Claimant sought additional benefits for complaints of back pain through a new workers’ compensation claim.  Respondents filed two motions for summary judgment, arguing that settlement barred further benefits for any injuries stemming from the 2009 claim, regardless of which body part was impacted, as Claimant had expressly agreed to waive further benefits under the settlement language.  Because Claimant’s new alleged injury was sustained while receiving treatment for the admitted shoulder injury, Respondents argued, Colorado law considers this to be related to that injury under the quasi-course and scope of employment doctrine.  The ALJ, ICAO, and the Colorado Court of Appeals agreed and denied Claimant’s claim for further benefits on this basis, dismissing the claim with prejudice.

Of Counsel Frank Cavanaugh successfully argued in James Allen v. US Engineering Co. and Liberty Mutual Fire Insurance, W.C. No. 4-945-671 (ICAO, December 8, 2014) that the employer must be apprised of the hearing by proper notice under the Workers’ Compensation Act, as it is a party of interest, and is entitled to a notice of hearing separate from that sent to the insurer.  This notice must affirmatively appear on the record, unless waived, or else the proceedings are void.  In this case, the Claimant failed to serve the employer the notice of the hearing.  The Court stated that due process requires the employer must be notified of pending proceedings affecting its rights, thus remanding the Order granting compensability.

Equal Employment Opportunity Commission Sues another Employer for Allegedly Violating the ADA for an Inflexible Leave Policy

The EEOC’s position is clear. The ADA requires employers to incorporate flexibility into their leave of absence policies or face the consequences. In late September, we were reminded of this yet again when the EEOC sued a Chicago-area manufacturer for capping the amount of leave provided to employees, without considering whether a reasonable accommodation may exist for each employee.

In this latest suit against Doumak, Inc., the EEOC alleged that an employer and its employees’ respective union had violated the ADA by placing a cap on the amount of leave available to employees (“a maximum of 12 weeks or 12 months of medical leave”). According to the EEOC, once employees reached this cap on leave, Doumak automatically terminated them instead of providing additional leave or other reasonable accommodations. In this case, the cap on leave was part of the collective bargaining agreements between Doumak and the employees’ local union. On November 4, 2014, Doumak and the local union settled the case by entering into a consent decree with the EEOC.  As part of the consent decree, the employer agreed to pay $85,000 and negotiate with the union to amend the relevant portions of the Collective Bargaining Agreements at issue. This case is part of a trend of lawsuits initiated by the EEOC over the past several years.

In 2012, the EEOC sued Interstate Distributor Company, alleging that the employer’s leave policy provided for automatic termination after 12 weeks of leave and required employees to return to work with no restrictions. That case settled for $4.85 million. In 2011, the EEOC sued Supervalu/Jewel Osco, making similar claims that the employer’s policy provided for automatic termination following a set amount of medical leave. That case settled for $3.2 million. The EEOC also settled a case against Denny’s Inc., for $1.3 million, where the agency claimed that the employer’s policy of providing a maximum of six months of leave violated the ADA.

These are but a few examples of instances where the EEOC has challenged employer leave policies that did not provide the type of flexibility required under the ADA. Remember, the ADA requires an individualized assessment to determine whether a reasonable accommodation may exist for an employee with a disability. When an employer has an inflexible leave policy (e.g., one that provides for automatic termination after a set period of time), the employer does not fulfill its obligation to engage in this individualized assessment under the ADA.  And, employers with large employee populations may be particularly vulnerable to litigation because of the large number of employees affected by such policies.

But, whether you’re big or small, the take away is the same – a one-size-fits-all leave of absence policy could land you in hot water. So, in this day and age, employers must continually ask themselves, does our leave policy provide for an individualized assessment under the ADA?

Cases You Should Know
It’s discretionary for an ALJ to speed read medical records:  Linda Artmann v. Reilly, Pozner & Connelly, LLP, and Sentinel Insurance Company, Ltd., W.C. No. 4-834-243 (ICAO, December 3, 2014), involved a Claimant with a low back injury who reached MMI, and was then removed from MMI by a DIME physician who recommended additional osteopathic manipulation and physical therapy.  Claimant then underwent a 24-month DIME two years later.  At the hearing to challenge the DIME physician’s MMI determination, the ALJ received 361 pages of medical documents from Respondents and another 112 pages, primarily medical, from Claimant.  Following a 15 minute recess and live testimony from Claimant, the ALJ submitted an oral decision in favor of the Claimant, determining that Claimant was not at MMI.  On appeal, ICAO held that the ALJ’s decision was supported by substantial evidence in the record.  The ICAO held that ALJs are experienced in the assessment of medical evidence and testimony, and are presumed to have special expertise in evaluating this evidence.  The Panel held that the ALJ was capable of weighing the doctors’ testimony and reports, and considering the bases of their opinions.

Respondents have no right to choose physician after proper showing by Claimant for physician change:  In Pedro Gutierrez Lopez v. Scott Contractors and Zurich American Insurance Co., W.C. No. 4-872-923 (ICAO, November 19, 2014), Claimant sustained injuries to both legs when attempting to get a truck out of snow on December 6, 2011.  The parties agreed to Claimant’s authorized treating physician.  Claimant continued to undergo treatment, but pain persisted.  Surgery was recommended, which the ATP recommended against, and Respondents did not authorize.  At a hearing on the authorization of surgery, which was granted, Claimant also asserted that he had lost confidence in the ATP and requested that another ATP be designated.  Claimant perceived some of the ATP’s statements to him as an assault on his religious faith.  The ALJ concluded that Claimant had made a proper showing that he had lost confidence in his ATP and that a change of physician would facilitate recovery.  On appeal, ICAO held that after a proper showing warranting a change of physician, the ALJ is under no obligation to acquiesce to a further physician referral from Respondents.  Further, ICAO held, there is no requirement that limits the ALJ’s authorization to a personal or prior treating physician.

Meritless claims still ripe for picking:  In Jane McMeekin v. Memorial Gardens and Reliance National Indemnity, W.C. No. 4-384-910 (ICAO, September 30, 2014), the Court overturned an award of attorney’s fees previously awarded to Claimant, holding that the issues endorsed on Respondents’ application for hearing were ripe for adjudication, and thus, did not warrant an award of fees to Claimant.  At hearing, the ALJ held that Respondents’ endorsement of apportionment and authorized treating physician were not ripe, and directed that Respondents’ pay attorney fees and costs to Claimant.  Claimant argued that Respondents did not possess evidence to support their claim in regard to the “authorized provider” issue endorsed for hearing.  As a consequence, Claimant argued that Respondents had requested a hearing on an issue that was not ripe for adjudication, and that Claimant was therefore entitled to attorney fees.  The Panel held that the likelihood of success of the merits of an issue is a distinct consideration from whether there is a legal barrier adjudicating the issue.  The Court distinguished between the merits of an issue and its ripeness, noting that the latter had nothing to do with the former, and that a frivolous or meritless claim may nonetheless be ripe for adjudication.  The Court noted that Workers’ Compensation Law often requires quick deadlines, requiring parties to take action before any significant evidence can be gathered.  The Court, therefore, opined that the parties would be forced to choose between their right to hearing or waiving that right to avoid an assessment of fess if they guessed wrong about the possible strength of their claim.  Thus, the Court held that Respondents’ endorsement of “authorized provider” did not have a legal barrier to adjudication, regardless of its merits.

Didn’t provide a designated provider list after employee injury?  Expect penalties:  Dennis Meenan v. Boulder County and Self Insured, W.C. No. 4-898-245 (ICAO, September 9, 2014) involves a claim by Claimant for penalties for Respondents’ failure to provide a designated provider list pursuant to C.R.S. § 8-43-404(5)(a).  The ALJ assessed penalties against Respondents for failing to provide a designated provider list to Claimant when aware Claimant was actively receiving medical care for a workers’ compensation injury.

Attorney’s Fees for Unripe Issues for Injuries Occurring Before July 1, 1991: ICAO upheld the ALJ’s denial of attorney fees to claimant for respondents’ alleged endorsement of an unripe issue for hearing in Wilde v. Sears Roebuck & Company and Allstate Insurance Co, W.C. No. 4-018-793 (ICAO June 9, 2014), though for reasons different from the lower court.  Claimant suffered an admitted injury in March of 1991 and made a request for prior authorization for surgery in 2013, which was timely denied by Respondents within seven business days with an Application for Hearing.  Claimant sought attorney’s fees when Respondents later re-filed the Application, alleging that the issue was unripe because the Application was outside of the seven-business day window set forth by statute.   The ALJ denied attorney fees because Respondents had initially challenged surgery within the permitted time frame.  ICAO upheld the decision, though it instead held that Claimant could not seek attorney’s fees because his injury occurred before the July 1, 1991 introduction of the attorney fee statute, which applied to injuries occurring on or after that date.  ICAO did not address basis for the ALJ’s finding that the issue was unripe because the initial Application was filed on time.

Appeals upon Error in the Record: In Milroy v. ICAO and City of Colorado Springs, W.C. No. 4-884-077 (Colo. App. 2014) (nsfop), the Colorado Court of Appeals, which affirmed the ICAO Decision denying Claimant’s appeal of the ALJ’s Order denying and dismissing his claim for a back injury, the ALJ denied Claimant’s claim for benefits but mistakenly did not record the hearing proceedings.  Claimant appealed, primarily on the basis that the ALJ erred in not recording the hearing, arguing the matter was therefore unappealable and warranted a new evidentiary hearing.    While Section 8-43-213(1), C.R.S., upon which Claimant relied, does state that hearing shall be taken either verbatim by a court reporter or otherwise by electronic recording, the Court of Appeals found that the absence of a recorded hearing transcript does not necessarily bar appellate review.  For a new trial on the basis of error, an appellant must: 1) make a specific allegation such; 2) show that the defect in the record materially impacts the appellate court’s ability to review; and 3) show that a proceeding under C.A.R. 10(c) (an appellate court rule which sets forth the proper procedure in the event of an absent written record) failed to produce an adequate substitute for the evidence.  The Court found that Claimant, in this instance, had failed to meet any of the above three criteria.  Specifically, the Court found that, in addition to the appellate court’s having access to all exhibits, written medical records, and deposition testimony, the ALJ’s detailed hearing notes were an adequate substitute for a written record.  Accordingly, the Court of Appeals affirmed denial of Claimant’s appeal in its entirety.

Ambiguity in a DIME Report and ALJ’s Jurisdiction Regarding Causation: The Colorado Court of Appeals set aside an ICAO decision upholding an ALJ’s findings regarding an ambiguous DIME determination in Samuels v. ICAO, Deli Zone and Sentinel Insurance Company, W.C. No. 4-761-359 (Colo. App. 2014) (nsfop), and remanded to the DOWC for clarification of the ambiguous opinion.  The DIME physician issued two consecutive opinions regarding MMI and impairment for an admitted left knee injury and what Claimant alleged was a related right knee condition.  Respondents did not admit for any impairment of the right knee and Claimant sought to overcome the DIME’s opinion on causation of this condition.  While ICAO upheld the ALJ’s determination that the DIME opinion was ambiguous in regard to causation of the right knee symptoms, it set aside the ALJ’s opinion that the DIME considered the right knee unrelated and remanded the case to the DOWC for further clarification on the issue.  The ICAO held that, because there was not substantial evidence in the record to support a finding that the DIME physician did not believe the right knee condition was work-related, in light of the ambiguity, the ALJ could not have found against Claimant in overcoming the DIME on that issue.

legaLKonnection Firm Newsletter – December 2014

Thank you for taking the time to read our Firm newsletter. Our newsletter provides a monthly update on recent developments within our Firm, as well as in the insurance defense community.

Looking Ahead

The cornerstone of Lee + Kinder was built on providing exceptional quality legal service in the fast-paced and ever-changing environment of Workers’ Compensation Law.  We succeeded.  As a result, we have expanded our knowledgeable attorney base to 13 since inception in July of 2008.  Along with new talent also comes new areas of expertise.  Our group of legal professionals bring with them a broad repertoire of real world experience and practical knowledge in the areas of Medicare Set-Asides, Business Law, Environmental Law, Employment Law, Insurance Defense, General Liability, Health Insurance Provider Recovery and Subrogation.

In 2015, our monthly newsletter will continue to bring you updates and developments in the field of workers’ compensation.  In addition, look for our new sections, titles, and/or articles on what’s hot in other legal practice areas by some of our top legal contributors:  Josh Brown will bring you “Down with Brown” – a snapshot into the hot-button topics of employment law and their legal ramifications.  Joe Gren will expound on topics pertaining to Subrogation, General Liability and Environmental Law, including Wildlife and Endangered Species, Public Lands, and Natural Resources, in “Cup ‘O Joe.”  Lastly, Frank Cavanaugh will “Just Be Frank,” walking you through the interesting twists and turns of Health Insurance Provider Recovery, Business Law and Construction Law.

As we close out the year, everyone here at Lee + Kinder wants to thank you for your overwhelming support and continued business in 2014. We wish you a wonderful holiday season and look forward to serving you in 2015!

Victory Lap

Of Counsel Frank Cavanaugh appealed an Order which found a claim compensable without the employer present at the hearing.  Mr. Cavanaugh successfully argued that the employer did not receive notice of the hearing pursuant to C.R.S. §8-43-211. ICAO remanded the matter back to the Office of Administrative Courts.
Of Counsel Joseph Gren successfully convinced the ALJ to dismiss a pro se claimant’s claim for compensability, TTD and medical benefits claim with prejudice in the matter of Suttle v. United Parcel Service and Liberty Mutual. During hearing, the ALJ granted the pro se Claimant an extension of the merits hearing in order to retain an attorney. The Claimant failed to obtain new legal counsel and Mr. Gren argued that the claim should be dismissed with prejudice pursuant to section 8-43-2079(n). The Claimant did not take the action that had initially justified the extension of hearing and the employer and insurer were prejudiced by the Claimant’s unreasonable delay in prosecuting his case.
Cases You Should Know
No benefit awarded? No appeal. A penny for your thoughts revisited. In Sandra Weitzel v. Delta County, Self-Insured, W.C. 4-926-816 (ICAO, April 3, 2014), Respondents filed a Petition to Review an Order that found Claimant’s carpal tunnel syndrome to be a compensable work-related injury. ICAO held that the Order was interlocutory because it merely determined compensability and provided a “general” award of medical benefits without indicating a specific treatment. ICAO held that the Order did not award or deny any specific treatment or benefit and was not subject to review.

Disabled does not mean unpaid. In Oatfield Whitney v. West Metro Fire Protection District, Self-Insured, W.C. 4-920-012 (ICAO, April 4, 2014), ICAO held that in order to recover TTD benefits for the three-day waiting period, a claimant must show that he was “disabled” for longer than two weeks. ICAO noted that to be considered “disabled” a claimant must show that (1) he experienced a loss or restriction in bodily function and (2) he experienced a wage loss. The facts of the case indicated that Claimant was unable to work because of his injury, but received regular wages during this time.  ICAO held that Claimant was not disabled for purposes of recovering TTD benefits because he did not sustain a wage loss from his injury.

Your attorney’s malpractice is your reasonable excuse. According to C.R.S. §8-43-103(2), a claimant must file a notice claiming compensation within 2 years of the date of injury. However, the statute of limitations may be extended to 3 years if claimant had a “reasonable excuse.”  In Jesus Aceves v. Genesis Fixtures and Fidelity & Guaranty Insurance Company, W.C. 4-844-271 (ICAO, November 14, 2014), Claimant retained counsel two weeks before the expiration of the 2-year statute of limitations, but his attorney failed to timely submit a claim. ICAO affirmed the ALJ’s decision to extend the statute of limitations to three years on the grounds that Claimant had a reasonable excuse. ICAO found that while there is no excuse for a Claimant’s ignorance of the law, the negligence of a Claimant’s attorney can constitute a reasonable excuse for not filing a timely claim for compensation. ICAO noted that the period should be extended to three years because there was a reasonable excuse and Respondents failed to prove that they were prejudiced by the failure to timely file the claim.

When the legislature said “statutory cap” on benefits, they meant it. Here, Claimant sustained a work injury in September, 2008. Respondents filed a Final Admission of Liability on December 13, 2010, admitting for $148,626.06 in TTD benefits and paying $10,562.46 in PPD benefits. At hearing, Claimant was found not at MMI.  Respondents filed a General Admission of Liability and reinstated TTD benefits.  When Claimant again reached MMI, Respondents had paid $161,657.39 in TTD and PPD benefits, which exceeded the combined statutory cap of $150,000 by $11,657.39.  In the Final Admission of Liability, Respondents asserted an overpayment for benefits paid over the cap, which they used to offset against disfigurement benefits. The ALJ found there was no overpayment because the benefits were paid pursuant to statute and Claimant had a right to the benefits. However, ICAO disagreed and noted, pursuant to C.R.S. §8-40-201(15.5), an overpayment is money received by a claimant that exceeds the amount that should have been paid.  ICAO held an overpayment includes combined TTD and PPD benefits received by Claimant in excess of the statutory cap. Danks v. Rayburn Enterprises, Inc. and Pinnacol Assurance, W.C. 4-770-978 (ICAO April 3, 2014).

Respondents get a second bite at the apple on causation.  In this case, Respondents filed a Final Admission of Liability, admitting for 23% upper extremity and 11% lower extremity impairment ratings.  Claimant sought hearing to convert the 23% upper extremity impairment to whole person. At hearing, Respondents argued the Claimant’s upper extremity symptoms were not related to the work injury.  The ALJ found Claimant’s upper extremity was not injured at work and that no PPD was owed for the upper extremity rating. Claimant appealed.  ICAO previously held Respondents, despite admitting for the body part in an FA, could challenge the causation element of a PPD award absent a DIME. Respondents filed an Amended FAL and only admitted for the 11% lower extremity, asserting an overpayment of PPD benefits paid toward the upper extremity. Claimant appealed, arguing Respondents could not now allege an overpayment since they already admitted and paid for the impairment.  ICAO held the PPD award paid for Claimant’s upper extremity was an overpayment, as it was money received by Claimant that exceeded the amount that should have been paid or that he was not entitled to receive, C.R.S. §8-40-201(15.5).  Because the Claimant requested a hearing regarding his impairment, the impairment and award did not become final after Respondents filed the first FAL. Therefore, Respondents could challenge causation and amend the FAL after the Order finding the upper extremity unrelated to the work injury and assert the overpayment. Franco v. Denver Public Schools, W.C. 4-818-579 (ICAO May 12, 2014).

The big, fat liar defense – credibility and bias of a witness are in sole discretion of an ALJ.  In February 2012, Claimant sustained an admitted injury to his back from a slip and fall at work. However, Claimant previously injured his low back in December 2011 in a motor vehicle accident. Claimant was placed at MMI with no impairment but he was provided with limited lifting restrictions. Claimant was involved in another MVA in September 2012.  He underwent a DIME for the work injury in February 2013.  The DIME physician opined Claimant had 5% whole person impairment according to Table 53 of the AMA Guides.  Respondents pursued hearing to overcome the DIME. Crediting the opinions of Claimant’s ATP, the ALJ held Respondents successful. Claimant appealed, arguing the ATP was biased.  However, ICAO held that weighing the credibility of the evidence was within the sole discretion of the ALJ and that the evidence supported the findings in this matter.  Gebereyes v. Veolia Transportation and Old Republic Insurance Co., W.C. 4-880-828 (ICAO April 25, 2014).

If the subcontractor of the general contractor of the homeowner says he has insurance, does anyone hear the tree falling in the woods? General contractors and homeowners may argue promissory estoppel to avoid liability for a subcontractor’s injuries if they relied on a certificate of coverage from the subcontractor’s insurer.  In Hoff v. Indus. Claim Appeals Office, 2014 WL 5034507 (Colo. App. Oct. 9, 2014), the Court of Appeals held that a homeowner was not barred from arguing promissory estoppel against a subcontractor’s workers’ compensation insurer when the homeowner was liable for benefits as a statutory employer.  In this case, a subcontractor sustained severe injuries after he fell from a ladder while repairing a roof on the homeowner’s property. The ALJ imposed liability on the homeowner as a statutory employer because the subcontractor’s workers’ compensation insurance was cancelled prior to the incident. The homeowner argued that the subcontractor’s insurer was estopped from denying coverage for Claimant’s injuries because it initially provided a certificate of coverage to the contractor and failed to provide a notice to the parties after the policy was cancelled.  The Court of Appeals found that the roofing contractor and the homeowner were entitled to rely on a certificate of coverage provided by the subcontractor’s insurer.  The Court also found that the insurer’s policy required it to notify the contractor of the cancellation of the policy. The Court remanded the case to determine whether the homeowner actually relied on the certificate when she contracted out the repair work.

Just because you can’t legally work here, doesn’t necessarily mean you can’t work here. ALJs have discretion to consider an injured workers’ immigration status in determining whether to award PTD benefits.  Claimant sustained an industrial injury to his back in 2008.  After reaching MMI, he pursued PTD benefits alleging he was unable to return to work due to his work injury. Respondents argued Claimant’s immigration status, not his work injury, prevented him from being able to return to work.  The ALJ credited testimony of Claimant’s psychologist and occupational therapist in finding Claimant was unable to return to work due to the work injury.  Respondents appealed and argued the ALJ should have considered Claimant’s immigration status in determining whether he was entitled to PTD benefits.  ICAO found there was substantial evidence to support the ALJ’s finding that Claimant’s disability, not his immigration status, caused his loss of earning capacity.  Spacecon Specialty Contractors, LLC and Tristar Risk Management v. ICAO and Ordonez, W.C. 4-792-073 (August 21, 2014 Colo. App. 2014) (nsfop).

legaLKonnection Firm Newsletter – November 2014

Thank you for taking the time to read our Firm newsletter. Our newsletter provides a monthly update on recent developments within our Firm, as well as in the insurance defense community.

In the News

Our growing team of highly capable counsel are here to provide legal expertise in Workers’ Compensation Defense as well as:
* Employment Defense  * General Liability
* Health Insurance Provider Recovery * Insurance Defense
* Medicare Set Asides  * Subrogation

Victory Lap

Of Counsel Sheila Toborg and Associate Angela Lavery successfully defended against Claimant’s requests for massage therapy and a massage chair as maintenance benefits in Joseph Dickerson v. Evraz Inc. NA (formerly known as Oregon Steel Mills). Ms. Toborg presented credible testimony from the Respondent-IME physician that the requests for massage therapy and massage chair were not reasonable or necessary post-MMI treatment.  The IME physician noted that Claimant’s condition was a chronic condition and that passive therapy, such as massage, was not indicated. The IME physician also testified that Claimant had not demonstrated any functional limitations, other than subjective complaints, to support the basis for the request.  The Administrative Law Judge (ALJ) denied Claimant’s requests for massage therapy and a massage chair.Of Counsel Joseph Gren defeated Claimant’s Motion for Summary Judgment in Robert Niziolek v. United Parcel Service and Liberty Mutual Insurance. Claimant moved for Summary Judgment to strike the 24-month DIME opinion, due to the fact that Claimant’s ATP had placed Claimant at MMI two weeks before the DIME appointment.  Claimant’s ATP had placed Claimant at MMI prior to the occurrence of the 24-month DIME, but subsequent to the request of the 24-month DIME by Respondents. Claimant argued that the statute required Respondents to respond within 30 days to the ATP’s finding of MMI. Claimant further argued that Respondents had failed to timely request a new DIME within 30 days of the placement of Claimant at MMI by the ATP, and consequently the impairment rating provided by the ATP was binding per C.R.S. §§8-42-107.2(2)(b) and 8-43-107(8)(b)(I). The ALJ agreed with Mr. Gren that Respondents had timely, and appropriately, requested a 24-month DIME under C.R.S. §8-42-107(8)(b)(II), to contest the ATP’s failure to place Claimant at MMI.  The ALJ interpreted the Act consistent with Mr. Gren’s argument that the Act gives the DIME jurisdiction over MMI and impairment after the party properly requests a DIME. The ALJ found that Claimant was not entitled to strike the 24-month DIME opinion and the ATP opinion had no bearing on the DIME process.Associate Matt Boatwright successfully overcame the DIME opinion inShaner v. United Parcel Service and Liberty Mutual Insurance, WC Nos. 4-887-012 & 4-904-678.   The DIME significantly increased Claimant’s impairment rating, which the DIME physician later reduced due to an evident miscalculation under the appropriate provisions of the AMA Guidelines, 3rd ed., rev. Notwithstanding, the ALJ found that the DIME, which still significantly increased Claimant’s impairment rating, contained multiple errors and defects.  These defects included an insufficient review of the pertinent medical records, an apparent confusion as to the left and right extremities in various areas of the report, and some marked differences in range of motion measurements with those of the authorized physician and Respondent’s IME physician.  Mr. Boatwright argued that, given the multiple shortcomings in the report, the DIME physician’s range of motion measurements should not be accepted as valid.  The ALJ agreed and held that the impairment rating of the authorized treating physician was binding to the benefit of Respondents.

Cases You Should Know
You think you were disabled before?  Just wait until you work here… Part Two: Sorting out complex medical conditions for PTD claims based on persuasiveness of medical opinions.    In Karen Apprill v. Kroeger, Self-Insured, W. C. 4-850-029-03, (ICAO, October 24, 2014), Claimant maintained that she was permanently and totally disabled and unable to earn wages from her work-related lower back injury of February 2011. However, before and after her work-related injury, Claimant had three non-work-related leaves of absence due to physical ailments, including a total knee replacement and stroke in 2013. Respondents presented medical evidence supporting their position that although Claimant was unable to work, it was due to her myriad of medical conditions other than the work-related injury. Claimant’s ATP had placed Claimant at MMI and noted her physical limitations from a FCE report.  In the MMI report, the ATP failed to distinguish whether her physical limitations were related to her work-related injury or her other medical conditions.  However, an IME doctor had specifically noted in his report that Claimant’s physical limitations not allowing her to perform employment duties were related to her knee condition, and other non-work-related conditions, rather than the work-related back injury, which he opined had resolved. The Court found that since the ATP had failed to distinguish which of Claimant’s medical conditions created her inability to work, the IME report and opinion was more persuasive and therefore denied Claimant’s claim for PTD benefits.In Joseph Krendel v. Hulcher Services and American Home Assurance, W.C. No. 4-744-188-03, (ICAO, November 4, 2014), Claimant sustained a work-related low back injury in 2007 which required multiple surgeries.  Claimant’s medical condition continued to deteriorate and he sought PTD benefits and post-MMI medical benefits, including treatment for a pulmonary ailment. Claimant was awarded PTD benefits. Claimant’s medical records noted that Claimant had no prior pulmonary conditions until his second back surgery in 2010, but had developed a respiratory infection and pneumonia subsequent to and as a result of the surgery.  Claimant required supplemental oxygen and continued to use it, even after the postoperative infection resolved. Claimant underwent an 18-month DIME in 2011 which found him at MMI and opined that Claimant’s post-surgery infection had long resolved. However, an ATP later noted that Claimant’s pulmonary condition was multifactorial: related to obesity-related hypoventilation, use of chronic pain medication, and sleep apnea.  Based upon substantial medical evidence, the ALJ concluded that the pulmonary symptoms were secondary to the low back surgery.  As a result, the pulmonary treatment was found to be related to the workplace injury.Be your own boss (with the income to prove it): AWW Fair Calculation and Independent Contractors. In Osman v. Colorado Cab Company and Old Republic Insurance, W.C. 4-905-869-01, (ICAO, October 30, 2104), Claimant sought review of an AWW calculation and argued that the ALJ abused his discretion by deducting Claimant’s business expenses from his gross earnings in order to determine his AWW. The ALJ found that the Claimant, a taxi cab driver, executed a contract with Colorado Cab Company (Colorado Cab). Pursuant to this contract, the Claimant indefinitely agreed to lease a taxi cab from Colorado Cab for $700.00 per week. However, the Claimant also was responsible for additional costs, penalties, and fees assessed by Colorado Cab; including credit card and other processing fees, costs associated with accidents and repairs, fees and penalties associated with accidents, pass through of traffic and parking tickets, and other items. The ALJ found that the Claimant did not earn a salary from the Respondent employer because he was an independent contractor. Instead, the Claimant earned income by collecting fares from customers. Additionally, the parties had stipulated to Claimant’s gross income and business expenses, which left $162.56 remaining in gross income. The ALJ concluded that the Claimant worked as an independent contractor for Colorado Cab and he earned an AWW of $162.56. In making his AWW determination, the ALJ deducted the Claimant’s business expenses from his gross earnings, and determined that this was a fair approximation of his wage loss and diminished earning capacity.

The Tax Man Cometh: Attacking credibility by presenting evidence of a failure to file income tax returns. This case comes from the Court of Appeals and may have implications for use of evidence in workers’ compensation claims. In Leaf v. Beihoffer, 2014 WL 4472746 (Colo. App. 2014), the Colorado Court of Appeals held that failure to file income taxes for several years can be used as impeachment evidence to demonstrate that an individual claiming personal injury is not credible.

legaLKonnection Firm Newsletter – October 2014

Thank you for taking the time to read our Firm newsletter. Our newsletter provides a monthly update on recent developments within our Firm, as well as in the insurance defense community.

In the News

The Division of Workers’ Compensation recently proposed a number of significant changes to Rule 5 of the Division’s Rules of Procedure [linked to the current Rule 5] pertaining to claims handling. Mr. Joseph Gren testified on behalf of the Colorado Defense Lawyers Association during the October 15, 2014 rules hearing at the Division of Workers’ Compensation.  Mr. Gren testified that several of the proposed changes could adversely impact insurance carriers and employers, and may cause unnecessary confusion in daily claims handling practices. The proposed changes are currently under consideration with the Director of the Division. After the Division promulgates the rule changes, we will be available to advise you on how the modifications affect daily claims administration.Additionally, Mr. Frank Cavanaugh lectured on the legislative changes to the Workers’ Compensation Act during the Colorado Bar Associations’ Annual Fall Update. Mr. Cavanaugh’s lecture was well attended by attorneys and workers’ compensation professionals representing injured workers, employers, and insurance carriers. If you have questions, concerns, or curiosity about the administrative or legislative changes to the workers’ compensation system, please do not hesitate to contact Mr. Cavanaugh or any of the attorneys at Lee + Kinder.

Thank you to those who participated in the Professionals in Worker’s Compensation (PWC) Golf Tournament at Raccoon Creek Course this year. Lee + Kinder was proud to sponsor the event and were soundly represented by Joshua Brown, Frank Cavanaugh, Jessica Melson, and Kelsey Bowers.

Victory Lap

Of Counsel Joseph Gren successfully defeated Claimant’s claim for workers’ compensation benefits in the matter of George Tomley v. United Parcel Service. Claimant reported a low back injury the day in which he alleged the injury to have occurred.  Even in light of the immediate reporting, Mr. Gren presented credible testimonial evidence that the employer immediately investigated the Claimant’s claim, and based upon the testimony, the ALJ determined that the injury more likely than not did not occur. Mr. Gren presented further evidence that the Claimant’s testimony about his medical history and his capacity to work was not credible. The ALJ additionally credited Respondents’ IME physician that no injury occurred as reported by the Claimant.Of Counsel Frank Cavanaugh was recently successful in a Motion for Summary Judgment in Paddock v. Einstein Noah Restaurant Group, a claim involving attorney’s fees sought by Claimant against Respondents.  Respondents settled Claimant’s workers’ compensation case.  The Claimant subsequently filed a negligence law suit in District Court against the third party who caused the Claimant’s injuries.  Respondents did not intervene in the case.  Rather, Respondents sold the subrogation lien to the insurer of the defendant in the third party case.  The Claimant proceeded to a jury trial whereby the jury denied the Claimant an award of damages.  Claimant filed an Application for Hearing seeking reimbursement, on an allocated basis, for costs and attorney fees incurred in the failed third party case.  Respondents moved for summary judgment against the Claimant, citing that Claimant’s workers’ compensation case settled and that the ALJ had no jurisdiction over this issue.  In addition, Claimant had not paid any fees or costs, although he was liable to pay them under the fee agreement with the attorney.  The ALJ granted Respondents’ Motion.  Attorney fees requested by Respondents for Claimant’s setting of a hearing on an unripe hearing issue is still under consideration.

Of Counsel Sheila Toborg successfully defended Respondents’ interests in a full contest hearing in Harold Wilson v. ADP Totalsource and New Hampshire Insurance.  Ms. Toborg presented evidence in the form of hearing testimony and an IME report from Dr. Allison Fall demonstrating that there was no objective evidence that Claimant suffered from “hot tub lung disease” related to his employment as a maintenance technician.  Although the Claimant provided medical evidence contrary to Dr. Fall, the ALJ found Respondents’ witness testimony and evidence more persuasive that Claimant likely suffered from hypersensitivity pneumonitis, unrelated to his employment.  Claimant’s claim for compensation was denied and dismissed.Cases You Should Know

Penny for your thoughts: Orders that do not provide/deny benefits are not subject to review.  In Stephanie Bishop v. City of Thornton, W.C. No. 4-830-904-02 (ICAO, March 26, 2014), the ICAO reaffirmed established case law that orders which do not require the payments of benefits or penalties, or deny the claimant benefits or penalties, are interlocutory and not subject to review.  See Ortiz v. Industrial Claim Appeals, 81 P.3d 1110 (Colo. App. 2003).  Claimant suffered a compensable injury in 2010, and petitioned to reopen her claim in 2013, arguing that her condition had worsened since the date of MMI.  A hearing was held on this issue, and the ALJ found that Claimant’s symptoms and disabilities were not related to her 2010 work injury, and denied the Petition to Reopen.  The ICAO held that the denial of the Petition to Reopen was not reviewable because it did not determine the Claimant’s entitlement to benefits.You think you were disabled before? Just wait until you work here…: Industrial injury need not be sole cause of permanent total disability. In Scott Chambless v. Hamlin Electric Company and Liberty Mutual Insurance, W.C. No. 4-865-310-01 (ICAO, April 3, 2014), the ICAO affirmed a finding by the ALJ that Claimant was permanently and totally disabled over Respondents’ arguments that Claimant’s medical disability and wage loss were due to a 1973 motor vehicle accident and recently diagnosed Parkinson’s Disease, and not the industrial injury.  The Court reasoned that the industrial injury need not be sole cause of the Claimant’s permanent and total disability in order to be compensable.  In rendering this decision, the Court relied upon the testimony of the Claimant’s vocational expert, who stated that it was unlikely that the 1973 accident created any of the Claimant’s current impairments.  Additionally, Claimant’s credible testimony that his Parkinson’s symptoms were well under control with medication was sufficient evidence to permit the Court to reasonably infer that the Claimant’s vocational limitations were related to his industrial injury and not his preexisting condition.

Sometimes it’s not so good to be the “King of the Hill:” Contractor liable as statutory employer even when subcontractor policy cancelled due to fraud. InAdan Gaytan Flores v. Needham Roofing , Inc., RPM X 1000, and Commerce & Industry Ins. Co., Twin City Fire Ins./The Hartford, W.C. No. 4-892-164-04 (ICAO, April 28, 2014), the ICAO found that a contractor’s workers’ compensation insurance carrier was liable for benefits of an injured subcontractor.  The subcontractor’s insurance policy was cancelled due to fraud, and the contractor then assumed liability based on its status as the statutory employer.  The Court found that the certificate of insurance indicating the subcontractor’s workers’ compensation insurance provided by the subcontractor’s insurer did not form a contract between the contractor’s insurer and subcontractor’s insurer that would bind the subcontractor’s insurer to liability for the benefits, despite its cancellation of the policy because of its procurement by fraud.

Even attorneys have to pay sometimes: Costs and fees assessable only against attorney, not claimant. In Lluvia Gutierrez v. Startek USA Inc., and Wausau Underwriters Insurance/Liberty Mutual, W.C. No. 4-842-550-05 (ICAO, March 5, 2014), the Court found that attorney fees were assessable against an attorney for filing an application for hearing on unripe issues, but not against Claimant individually.  Claimant, who sought penalties against employees of the Division of Workers’ Compensation, was denied relief.  Claimant then filed an additional Application for Hearing to review the prior decision.  Respondents requested the claim be closed, as Claimant had waived his right to the DIME process.  Claimant then filed another Application for Hearing, endorsing as issues to review the ALJ’s prior Orders.  Respondents sought penalties on the grounds that the Claimant filed another Application for Hearing after the ALJ struck previous hearing applications, as the issues endorsed for hearing were deemed unripe.  The Court again struck the Application for Hearing. The ALJ ordered Respondents to set a hearing on the matter of determining reasonable fees and costs.  The ALJ subsequently assessed attorney’s fees against Claimant.  Claimant appealed, arguing that the ALJ erred by assessing attorney’s fees and costs against the Claimant individually, rather than against her attorney.  ICAO remanded the case for further findings as to whether the costs and fees were assessed against Claimant or her former counsel.

Missed the mail man: Denial of authorization for change of physician request still timely if sent within time limit following a late receipt of request.  In Juan Rivera v. Conway Freight Inc., and Indemnity Insurance, W.C. No. 4-917-273-01 (ICAO, March 19, 2014), Claimant suffered a compensable injury in April 2013.  During September and October of that year, Claimant spoke with the adjuster and nurse administrator regarding his claim.  Claimant’s counsel entered his appearance on September 18, 2013.  Claimant continued, however, to communicate directly with the adjuster and nurse administrator regarding his concerns about returning to work and his treating physicians, without notifying them that he was represented.  The adjuster received the Entry of Appearance on October 21, 2013.  Also on that date, the adjuster received a request for a change of physician pursuant to C.R.S. § 8-43-404(5)(a)(VI) from Claimant’s counsel dated September 18, 2013.  The adjuster denied this request by correspondence dated October 30, 2013.  The ALJ found, and the ICAO affirmed, that the adjuster had timely informed Claimant that the change of physician request was denied.

Just because you have a theory as to how your work hurt you, doesn’t mean you are correct: Claimant must show substantial evidence to directly tie injury to work conditions.  In Cory Savage v. First Fleet Inc., and Travelers Indemnity Company, W.C. No. 4-929-714-01 (ICAO, March 26, 2014), Claimant alleged suffering carbon monoxide poisoning when he slept in the cab of his truck.  The court found that Claimant failed to establish that his injury arose out of the conditions of employment, as required by C.R.S. § 8-41-301(1)(c).  The Court held that the Claimant failed to prove that he was exposed to toxic levels of carbon monoxide linked to his truck. The ICAO noted that the individuals performing the testing of the truck did not recreate the weather conditions on the date of injury, that a trailer was not attached to the tractor, that the testing did not require the truck to be idled for eight hours, and that it was tested by individuals who were not qualified as experts on the effects of carbon monoxide exposure. The ICAO found that the mere fact that a Claimant develops an injury during the course of his employment does not relieve that Claimant of proving that the injury arose out of Claimant’s employment.  The Court held that because of the absence of evidence showing a direct tie to the work itself, or evidence to show that but for the requirement of work an employee in similar conditions would also suffer these symptoms, the Claimant’s injury fell into a category of personal risk, and was therefore not compensable.

It’s not just about the bottled water: Disaster relief program volunteers fall within statute for compensability: In Smith v. Teller County and Teller County WC Pool, W.C. No. 4-920-458 (ICAO, August 26, 2014), the ICAO upheld an ALJ’s decision finding an injury compensable where the Claimant was a volunteer for a search and rescue organization and was involved in a car accident while traveling to a fire chief’s meeting.  Claimant was the president of the volunteer organization and was driving to attend a meeting when he was struck by an oncoming car.  The ALJ found that under section 8-40-202(1)(a)(I)(A), C.R.S., which covers disaster relief volunteers (among others) who are injured while performing duties or while engaged in training activities, Claimant’s injury was compensable under the Act.  Respondents contended that this provision did not cover the injury because Claimant was merely attending a meeting, not training as described by the statute, and that the meeting was optional, not mandatory. Respondents also argued that the injury was not compensable because Claimant was traveling to the meeting and was exempted under the going-to and coming-from rule regarding travel status. The ALJ rejected both of these arguments, finding that the meeting was for purposes of organizing and preparing for disaster relief, which essentially satisfied the training portion of the statute.  The ALJ also found (citingColorado Civil Air Patrol v. Hagans, 662 P.2d 194 (Colo. App. 1983)), because the attendance of the Claimant at the meeting furthered the county’s interest in the coordination of its disaster relief program, the travel to the meeting was implicitly part of the “employment” agreement.  The ICAO upheld the decision as supported by substantial evidence.

Don’t do that chest bump quite yet: Horseplay and Compensability.  The ICAO upheld an ALJ’s dismissal of a claim involving a fractured arm on the basis that Claimant was involved in horseplay in Trujillo v. Lowe’s, W.C. No. 4-932-395 (ICAO, July 29, 2014).  Claimant fell and broke his arm after engaging in a “chest bump” with a co-worker to celebrate completion of a work task.  The Court referenced Panera Bread, LLC v. ICAO, 141 P.3d 970 (Colo. App. 2006), in assessing whether this activity constituted horseplay sufficient to sever the causal connection with the employment.  The Court indicated that under these circumstances, the most important criteria to gauge horseplay activity include the extent and seriousness of the deviation from employment, and the completeness of the deviation.  The Court determined that Claimant had engaged in a chest bump at his own accord and at no benefit to the employer.  Accordingly, the Court agreed with the ALJ that Claimant was injured in the course and scope of a chest bump, not his employment.

Another penny for your thoughts: Appeals of Decision Solely on Compensability are Interlocutory.  In Weitzel v. Delta County, W.C. No. 4-926-816, (ICAO, August 20, 2014), the ICAO dismissed Respondents’ Petition to Review an Order by the ALJ finding a claim compensable and ordering payment only of general medical benefits.  The ICAO held that orders determining compensability and containing only a general award of medical benefits, and not specific treatment, are interlocutory and not appealable.  Appealable orders are those which involve an award or denial of particular medical benefits.

Three days is long enough, two days is not: Disability and Entitlement to Temporary Benefits.  The ICAO upheld an ALJ’s Order denying Claimant temporary disability benefits for two days because he was not “disabled” under the Act in Whitney v. West Metro Fire Protection District, W.C. No. 4-920-012 (ICAO, August 27, 2014).  Claimant, a firefighter, was diagnosed with cancer and was off work on sick leave for two days pursuant to his condition.  Claimant sought temporary disability benefits only for these two days. Under Section 8-42-103(1), C.R.S., an injured worker is not entitled to temporary disability if the period of disability does not last longer than three days from the day the employee leaves work due to the injury.  This same provision states that temporary benefits are owed where the period of disability exceeds two weeks.  The term “disability” under the Act includes two elements, medical incapacity, which is evidenced by loss of bodily function, and loss of wage earning capacity, which is evidenced by wage loss.  See Culver v. Ace Electric, 971 P.2d 641 (Colo. 1999).  The ICAO upheld the ALJ’s finding that under these criteria, Claimant was not disabled for purposes of temporary benefits because he was not off work for more than three days and his disability did not last for more than two weeks.

Just because you wear a black robe: ALJ’s Authority to Determine Credibility of WitnessesIn Williams v. Colorado Cab d/b/a Denver Yellow Cab and Old Republic, W.C. No. 4-920-621 (ICAO, June 25, 2014), the ICAO upheld the ALJ’s denial of a claim for benefits and his finding that Claimant had not testified credibly at hearing on compensability.  Claimant was a taxi driver who was involved in a drunken car accident with two other passengers in his taxi, while driving through the mountains to the western part of the state.  Prior to the trip, Claimant had stopped at a restaurant and consumed alcohol with one of the passengers, thereafter picking up the second passenger on his way to what his employer alleged was a vacation destination.  Claimant was driving with his meter off during the entire journey, which the employer testified was against company policy for fares.  The employer also testified that cab drivers were not allowed to go beyond 16 miles outside of the city.  Claimant contended that while he was driving with his meter off during this trip, he was paid a cash sum by one of the passengers.  The ALJ found Claimant’s testimony not to be credible and found in favor of the employer.  The ICAO deferred to the ALJ’s determinations, noting that an ALJ’s credibility determinations are binding except in extreme circumstances (see Arenas v. ICAO, 8 P.3d 558 (Colo. App. 2000).

It’s Illegal to claim a claimant is illegal? : Immigration status is immaterial to determination of PTD benefits.  The Colorado Court of Appeals upheld a decision, inSpacecon Specialty Contractors, LLC and Tristar Risk Management v. ICAO and Erasmo Ordonez, (Colo. App. 2014)(nsfop), which found that Claimant was not barred from receiving workers’ compensation benefits due to his immigration status.  Claimant suffered a work-related injury in 2008 and was awarded PTD benefits by the ALJ at a subsequent hearing.  Respondents’ vocational evaluator indicated that Claimant had represented that he was ineligible for Social Security benefits because he did not have “papers.”  Claimant invoked the 5th Amendment of the U.S. Constitution when asked about his immigration status on the stand.  Respondents argued, at hearing and upon appeal, that Claimant was not permanently and totally disabled because of his work injury, but rather that he could not find employment because he was in the country illegally.  The ALJ found that Claimant was permanently and totally disabled because of the work injury and that his immigration status was irrelevant to that finding.  The Court of Appeals deferred to the ALJ’s determinations regarding the cause of the Claimant’s inability to work, in this respect, and upheld the decision.

legaLKonnection Firm Newsletter – September 2014

Thank you for taking the time to read our Firm newsletter. Our newsletter provides a monthly update on recent developments within our Firm, as well as in the insurance defense community.

In the News

Lee + Kinder is excited to welcome our newest Associate Attorney, Daniel Mowrey!  Mr. Mowrey is a graduate of Indiana University Law School. He served as a Law Clerk at Lee + Kinder through the summer of 2014 helping defend employers and insurance carriers in workers’ compensation claims.  The Firm is proud to announce that Mr. Mowrey was recently admitted to the Colorado Bar this September.  We are happy to have him on the team!

Victory Lap

Associate Matt Boatwright successfully limited Claimant’s permanent impairment to a 15% scheduled rating of the upper extremity in Claimant’s attempt to convert his rating to that of whole person in Downen v. United Parcel Service and Liberty Mutual Insurance, W.C. 4-823-249.  Claimant sustained an injury to his right shoulder in 2010. He received scheduled impairment ratings for loss of range of motion of the arm and for the distal clavicle.  Claimant argued that because he received a permanent impairment rating for structures which were above the humeral head of the arm, the permanent impairment should be considered a whole person rating under theAMA Guidelines, 3rd Ed. Rev.  Relying upon the “situs of functional impairment test” outlined in Strauch v. PSL Swedish Healthcare System, 917 P.2d 366 (Colo. App. 1996), Respondents argued that, regardless of whether the impairment rating was above the arm, Claimant’s only functional impairment was in the arm itself, and not anywhere else in the body.  Respondents also argued that despite the distinction between the shoulder and the arm, the shoulder was nevertheless part of the upper extremity for purposes of providing a scheduled impairment rating.  ALJ Edwin Felter agreed with Respondents, finding that the situs of Claimant’s permanent functional impairment was to the upper extremity and that therefore the permanent impairment rating was appropriately limited under the schedule of impairments.

Member Attorney Joshua D. Brown and Associate  Jessica C. Melson successfully limited an increase in Claimant’s AWW in Alarcon v. Coca-Cola Refreshments USA, Inc. and ACE American Insurance Co., WC 4-910-466. The admitted AWW was based on Claimant’s wages approximately one year prior to his injury. Claimant sought to increase his AWW by $31.56 based on his wages six weeks prior to his injury. Respondents argued these weeks did not accurately reflect Claimant’s wage loss. The ALJ agreed with Respondents and ordered only a minimal increase in Claimant’s AWW. 

Of Counsel Attorney Sheila Toborg successfully defended against a compensability claim for an alleged occupational disease to the right shoulder in Kristin Penley v. CDI Corporation and Liberty Mutual Insurance, (W.C. No. 4-949-902, September 17, 2014). Ms. Toborg presented medical records and expert testimony to demonstrate that Claimant did not sustain an occupational disease or traumatic injury as a result of her work.  Ms. Toborg successfully convinced the ALJ that Claimant failed to meet her burden of proving that she sustained a compensable injury. The claim was denied and dismissed.

Cases You Should Know

Termination for Testing Positive for Marijuana is still an Affirmative Defense Despite Recent Changes in Colorado Law:  While Colorado has legalized marijuana, employers may still raise the defense of termination in workers’ compensation cases to defend post-termination TTD claims.  In a recent ICAO case, Claimant was terminated for violating the company’s drug policy, which prohibited employees from being on company property while in an impaired condition.  Bolerjack v. Water Edge Pond Service, LLC, (W.C. No. 4-905-434, July 29, 2014). Claimant came to work two weeks after the work injury and was given a drug test. The test revealed an extremely high level of THC.  An expert opined that the test result indicated that Claimant was a regular, heavy user of marijuana and was, more likely than not, intoxicated at the time the test was taken. The ALJ denied the Claimant’s request for post-termination TTD benefits as he found that Claimant’s wage loss was the result of his termination for cause.  Claimant argued that he used the marijuana to deal with the pain caused by the work injury; however, the ICAO affirmed the ALJ’s Order.

Quasi-Course of Employment Doctrine does not Extend Benefits to Injuries Sustained while Traveling to Unauthorized Treatment: According to the quasi-course of employment doctrine, workers’ compensation insurance coverage extends to injuries sustained while traveling to and from authorized treatment.  However, the ICAO recently re-affirmed that the quasi-course of employment doctrine does not extend benefits to injuries that are sustained while traveling to unauthorized treatment for situations that are not emergencies.  Catlow v. Dairy Farmers of America, (W.C. No. 4-886-133, August 4, 2014).  In this case, Claimant testified that he experienced a sudden onset of back pain and decided to drive to a physical therapist without an appointment and despite the fact that his physical therapy was recently discontinued by his treating physician.  Claimant was injured in a car accident while traveling to the physical therapist.  ICAO agreed with the ALJ and found that the injuries were not compensable because Claimant’s sudden need for physical therapy was not an emergency situation, nor was the treatment authorized by the employer.

Claimant Must Obtain a Follow-Up DIME in order to Seek Additional PPD Benefits: If a DIME is performed in a claim, the impairment rating provided may not be increased unless a follow-up DIME increases the rating. Gailey v. Silver Mine Subs, (W.C. No. 4-764-331, July 24, 2014). In this claim, a DIME physician provided Claimant with a 28% whole person impairment rating. Claimant later received a 32% impairment rating from a treating provider. Claimant filed a Petition to Reopen for worsening of condition and requested TTD and PPD benefits. The ALJ denied the Petition to Reopen because Claimant’s condition had not worsened since being placed at MMI and indicated that any increase in impairment rating must be done through a follow-up DIME.  ICAO held that the mere fact that Claimant received an increased impairment rating does not compel the conclusion that there was a worsening of condition. Additionally, ICAO concluded that the ALJ could not award additional PPD benefits unless the follow-up DIME increased the prior impairment rating.

The Issue of Maintenance Medical Treatment is not a Ripe Issue Until after a DIME When MMI is Disputed:  The ICAO held that an ALJ cannot issue an order regarding medical care after MMI if a DIME is requested and not yet performed.  In Hubbard v. University Park Care Center, (W.C. No. 4-907-314, July 17, 2014), Respondents originally denied the claim, but requested a DIME after the treating provider placed Claimant at MMI with a high impairment rating.  At a hearing held before the DIME was completed, the ALJ found that the claim was compensable and ordered Respondents to pay temporary disability benefits and maintenance medical care after MMI. While the ICAO upheld the Order regarding compensability and temporary disability benefits, it indicated that the Order regarding maintenance care was not ripe.  The ICAO opined that the DIME was necessary to confirm the MMI and permanent disability related to the matter. As such, the issue of maintenance care could not be considered by the ALJ until the DIME was completed and the MMI date confirmed.

DIME Determination of Causation: Claimant’s ATP opined she had a 12% whole person impairment to her cervical spine. Claimant requested a DIME. The DIME doctor opined Claimant’s impairment was not due to the industrial incident but was instead due to her preexisting condition and therefore provided a 0% impairment rating. Claimant sought to overcome the DIME. The ALJ held an apportionment analysis was not necessary where the rating physician determines there is no causal relationship between the industrial injury and the impairment. ICAO noted that the DIME physician’s findings of causal relationship between an injury and impairment must be overcome by clear and convincing evidence, which Claimant failed to do. ICAO upheld this decision. Marquez v. Amerigold Logistics and Hartford Insurance Company, WC 4-896-504 (ICAO April 14, 2014).

Exception to the Going to and Coming from Work Rule: Claimant was injured in a motor vehicle accident on the way to work. Claimant argued travel was a part of his employment contract because his job required him to use his personal vehicle to attend appointments with customers. ICAO noted Claimant was required to come to work in a personal automobile he would then use to attend appointments and meetings with customers, travel, and attend events.  ICAO further noted this as an ultimate benefit to the employer, and contemplated in the contract for hire. ICAO reversed the ALJ’s ruling and found the Claimant’s claim arising out of the auto accident was compensable. Rieks v. On Assignment Inc. and Sentry Ins., WC 4-921-644 (ICAO March 31, 2014). This is a significant broadening of workers’ compensation coverage when employers require employees to use personal vehicles for work purposes.

Sometimes it’s Good to be the Statutory Employer: This case has a lengthy factual and procedural history. In summary, Claimant was injured while working on a drilling rig in Colorado. Claimant sued Tesco, the operator of the drilling rig, for negligence. Tesco asserted it was Claimant’s statutory employer and therefor immune from a negligence claim. A few hours before the Claimant was injured, Tesco contracted its personnel services to Turnkey, which included the Claimant’s job functions. Claimant argued Tesco was no longer his employer and therefore could be sued for negligence. The Court applied the “regular business test” to determine whether Tesco, the contracting party, was a statutory employer.  The “regular business test” is satisfied where the work performed by the Claimant is so essential to the day-to-day business operations of the employer that it cannot continue to function without the task being performed. In this case, the Court noted, Tesco remained an active participant in drilling services, remained obligated to perform its duties under a contract with another party of the drilling operations, was responsible for rig safety, providing labor, designating drilling locations, and schedule. Therefore, the Court found Tesco was a statutory employer and immune from a personal injury suit. The four million dollar verdict was vacated. Phathong v. Tesco Corp., No. 12-1455 (Fed. Cir. 10, May 6, 2014) (nsfop).

legaLKonnection Firm Newsletter – August 2014

Thank you for taking the time to read our Firm newsletter. Our newsletter provides a monthly update on recent developments within our Firm, as well as in the workers’ compensation community.

In the News

Lee + Kinder, LLC releases our new and improved website today.  We invite you to take a look and tell us what you think at  In addition to expanding the portability of the Lee + Kinder website by making it responsive to all devices, we also wanted to improve on simplistic accessibility to increased resources and information – not only in the area of workers’ compensation defense, but in other practice areas as well.  As Lee + Kinder has grown over the past 6 years, so has our knowledge base and our diversity.  Our team is able to provide professional legal advice and sound, comprehensive guidance in the areas of employment defense, general liability, insurance defense, healthcare provider recovery, Medicare Set Asides, and subrogation, in addition to the area for which so many of you have come to trust and rely on us – workers’ compensation defense.  So, take a surf on the web and a tour of our Firm.  We look forward to expanding our success with the application of our Firm philosophy since its inception: Integrity. Knowledge. Service.

Victory Lap

Member Joshua Brown, assisted by Associate Jessica Melson, successfully limited Claimant’s attempt to increase his Average Weekly Wage in Shawn Runnells v. Kum & Go and Zurich American Insurance. Claimant attempted to increase his AWW by $41.33 based upon his wages prior to his date of injury and to include a post-injury raise. Respondents argued Claimant failed to establish that the admitted AWW was not a “fair computation of his wage loss and diminished hearing capacity” Campbell v. IBM Corp., 867 P.2d 77 (Colo. App. 1993). Ultimately, the Court found that 13 weeks was an appropriate period of time to establish Claimant’s AWW but declined to recognize Claimant’s post-injury raise in calculating AWW. The Court held that Claimant’s AWW should be increased by a mere sixty-nine cents.

Mr. Brown and Ms. Melson were also successful in defending against Claimant’s claims for a general award of Grover(maintenance) medical benefits and a PPD award in excess of the DIME impairment rating.  In Keith Brockschmidt v. Skywest Airlines, Inc. and ACE American Insurance Company, Mr. Brown presented credible evidence based on the testimony of Claimant’s DIME physician, Dr. Hattem, that Claimant had over six years of treatment with less than a fifty percent improvement in complaints.  Dr. Hattem testified that additional treatment for Claimant’s back was not reasonable or necessary and not indicated within the Medical Treatment Guidelines.  Claimant’s request for a general award for reasonable and necessary Grover(maintenance) medical benefits was therefore denied and dismissed.  Claimant’s request for an award of PPD benefits in excess of those calculated according to the DIME physician’s rating was also denied and dismissed, as Claimant did not present clear and convincing evidence to overcome the DIME physician’s opinion.

Cases You Should Know

When an ALJ determines a DIME physician’s true opinion, the party seeking to overcome the DIME bears the burden of proof.  In April Samuels v. Deli Zone, W.C. 4-761-359-02 (June 18, 2014), Claimant sustained a left knee injury in 2007 and over the next few years underwent medical treatment for the left knee.  By 2010, Claimant reported gradual onset of right knee pain, which she attributed to compensating for the left knee injury.  The authorized treating physician (ATP) placed Claimant at MMI.  Claimant requested a DIME.  The DIME physician disagreed with the ATP’s MMI determination and found that Claimant needed additional conservative treatment for the left knee.  Regarding the right knee, the DIME physician diagnosed Claimant with chondromalacia patella, stated that Claimant’s right knee symptoms were due to compensation patterns resulting from the work-related left knee injury, and that additional evaluation of the right knee was needed.  The DIME physician re-evaluated Claimant two-and-a-half years later.  He found Claimant at MMI, gave her a permanent impairment rating for the left knee, and stated “[m]y opinion is unchanged on the right knee from my previous report.”  Respondents admitted to the left knee impairment rating and MMI date.  The ALJ found that the DIME physician ultimately determined that Claimant’s right knee symptoms were not related to Claimant’s left knee injury.  Claimant appealed, arguing that the ALJ’s interpretation of the DIME report was wrong and because Respondents did not contest the DIME physician’s findings about the right knee, the ALJ was jurisdictionally barred from considering the issue of compensability of the right knee injury.  The ICAO affirmed the general rule that where a DIME physician offers ambiguous or conflicting opinions concerning MMI, it is for the ALJ to resolve the ambiguity and determine the DIME physician’s true opinion as a matter of fact.  Then, finding for Respondents, the ICAO reasoned that because the ALJ made a factual determination that the DIME physician’s true opinion was that Claimant’s right knee symptoms were not compensable, the ALJ properly placed the burden of proof on Claimant, and therefore the ALJ’s consideration of the right knee compensability issue was not jurisdictionally barred.

An ALJ is not compelled to find a claimant not at MMI merely because the DIME physician recommended further evaluation of a certain condition. This case also held that if a DIME physician recommends additional testing to complete the DIME process, an ALJ may conclude that such testing is not inconsistent with MMI because it is not primarily performed for the purpose of treatment or diagnosis, but to assist the DIME physician in performing his evidentiary role.

A claimant is presumed to know the statutory requirements of the statutory scheme under which he seeks benefits.  C.R.S. 8-73-112 allows a claimant to receive the benefit of available wage credits for unemployment benefit purposes that would normally be lost during the claimant’s period of disability.  C.R.S. 8-73-112 explicitly states that it applies “only if a claim . . . is filed within the four weeks immediately following the termination of the continuous period of total disability.”  In Gregor M. Bryant v. Industrial Claim Appeals Office of the State of Colorado; and Division of Unemployment Insurance, 14CA0461 (Colo. Ct. App. 2014), Claimant filed his unemployment claim ten months after the termination of his TTD period.  Because Claimant filed after the statutory four-week time limit, a hearing officer held that Claimant was not covered by the statute allowing use of the additional wage credits.  The ICAO affirmed the hearing officer’s decision.  Claimant again appealed, arguing that he would have timely filed his claim had he been aware of the statutory deadline.  The Colorado Court of Appeals affirmed the lower courts’ orders denying Claimant the advantage of the statute.  The Court of Appeals reasoned that even though Claimant may have been unaware of the statute’s time limitation, the Court may not ignore the statute’s plain language requiring a claim to be “filed within the four weeks immediately following the termination of the continuous period of total disability.”  The Court stated that claimants are presumed to know the requirements of section 8-73-112.  And, unlike certain other statutes in the unemployment scheme, section 8-73-112 does not permit untimely action based on a showing of good cause.

If the designated treating physician refuses to provide treatment for non-medical reasons, the insurer must designate a new treating physician or the right of selection passes to the claimant. To be considered an authorized treating physician (ATP), the physician must be in the chain of referrals.  In Garcia v. McDonald’s Corporation and Zurich c/o Gallagher Bassett Services, W.C. 4-862-853 (June 19, 2014), Claimant sustained an admitted head injury and then sought cervical fusion surgery based on the work injury aggravating a cervical spine herniation.  Claimant was seen by Dr. Caton for her work-related injury. Dr. Caton opined that although Claimant needed surgery to treat a disc herniation, she could not refer Claimant for surgery because she had only authority to treat the work-related injury and she did not opine that the disc herniation was work-related.  Claimant sought treatment and surgical intervention from Dr. Coester based upon a referral from her personal physician.  Respondents appealed a decision that they pay for Claimant’s cervical fusion surgery stating that the surgeon was not an authorized ATP because he was not in the chain of referral.  In this case, Dr. Coester was not directly in the referral from Dr. Caton, but was a referral from Claimant’s personal physician.  The ALJ determined that the referral was ambiguous and that Dr. Caton denied treatment for non-medical reasons.  The denial of treatment was due to non-medical reasons as Dr. Caton opined that the pathology requiring the surgical intervention was not work-related.  Per Workers’ Compensation Rule of Procedure Rule 16-9(B), “lack of prior authorization for payment does not warrant denial of liability for payment.”  The ALJ considered the testimony of another physician, Dr. Rook, and Claimant to be credible and demonstrative that the work-related incident did aggravate a pre-existing cervical condition.  The Order finding Respondents liable for the costs of cervical fusion surgery was upheld.

Death Benefits are independent from compensation benefits paid to an injured worker.  In Ragan v. Metal Stud Forming and Colorado Insurance Guaranty Association, W.C. 9-920-457-02 (July 9, 2014), the Court denied and dismissed a dependent’s claim for compensation of death benefits.  The “rule of independence” provides that disability benefits awarded to a worker and death benefits awarded to workers’ dependents, constitute separate and distinct claims involving distinct rights. Therefore, the rights and liabilities of the parties are determined by the statute in effect at the time of Claimant’s injury or the date of decedent’s death.  In this case, Claimant suffered a heart attack while driving a truck for the employer in 1982.  The parties entered into a settlement agreement under which the insurer continued to pay reasonable and necessary medical benefits.  However, in 2003, the insurer at the time of Claimant’s injury became insolvent and an Order of Liquidation required that all claims with the insurer were to be filed within one year of the date of the Order.  The Colorado Insurance Guaranty Association (CIGA) took over payment of claims while insurer was liquidated.  Claimant passed away in 2013 and Claimant’s widow filed a claim for death benefits.  The claim was denied by CIGA because it was not filed within the timeframe of the Order.  The Court agreed with Respondents and upheld the decision denying benefits because the death claim was properly viewed as a “new claim” per the rule of independence and not merely derivative of the initial claim for benefits.  Therefore, the filing of the claim for death benefits needed to be filed separately within the terms of the timeframe within the Order of Liquidation.

legaLKonnection Firm Newsletter – July 2014

Thank you for taking the time to read our Firm newsletter. Our newsletter provides a monthly update on recent developments within our Firm, as well as in the workers’ compensation community.
In the News

On July 14thLee + Kinder, LLC celebrated its 6th anniversary, providing comprehensive and legal services to employers and insurers throughout Colorado. Since inception, our approach to the practice of law has been simply based on our three founding principles:  Integrity, Knowledge and Service.  We believe that says it all.  We also believe that we would not be where we are now, 6 years later, without the support of our clients.  We send out a very heartfelt thank you for entrusting us with your legal matters.  Our promise to you is to continue providing you with legal representation beyond your expectations.  Thank you for your business.Our Newest Member

Lee + Kinder, LLC welcomes Joshua D. Brown as a Member of the Firm.   Mr. Brown initially joined the Firm in January of 2013 as Of Counsel, bringing with him an extensive and impressive background in handling all facets of employment law.  He has been practicing in Colorado since 2005 handling matters arising under such laws as Americans with Disability Act (ADA), Title VII of the Civil Rights Act of 1964, the Age Discrimination and Employment Act (ADEA), Colorado Wage Act and the Fair Labor Standard Act.  Over the years, Mr. Brown has successfully defended employers against claims of workers’ compensation, discrimination, harassment, retaliation based on race, color, religion, sex, national origin, age and disability, in addition to local discrimination laws.  He has also represented employers in the enforcement of employment contracts, including breach of contract matters, non-compete and trade secret issues.  As he has done so well in the past, Josh will continue to specialize in the defense of employment matters, as well as General Liability, Insurance Defense, Subrogation and Workers’ Compensation Defense.Victory Lap

Of Counsel Sheila Toborg and Associate Kelsey Bowers were successful in a full contest win in Esperanza Morfin v. Earthgrains and Indemnity Insurance Company of North America. Claimant alleged that she injured her back after a slip and fall accident at work. Ms. Toborg offered credible evidence at hearing showing the medical evidence did not support a finding that Claimant sustained any injury as a result of the alleged fall. The Administrative Law Judge found that Claimant had exaggerated her pain complaints and there were no objective findings to show a work-related injury. Claimant’s claim was denied and dismissed.Of Counsel Sheila Toborg and Associate Kelsey Bowers also successfully defended against a claim for medical benefits inCharles Conant v. Hemphill Trucking d/b/a Hemphill Speedy and Liberty Mutual Insurance. Claimant was seeking medical benefits that included a triple-phased bone scan to test for Complex Regional Pain Syndrome (CRPS), additional sessions of acupuncture, pain counseling, and a compound cream for pain relief. Ms. Toborg highlighted the fact that Claimant had previously undergone testing for CRPS with negative results and that he had not experienced any long-term benefit from the previous sessions of acupuncture. Ms. Toborg also presented evidence to show that Claimant made inconsistent pain reports, which were not supported by objective medical findings.  The Administrative Law Judge found that the requested medical benefits were not reasonable, necessary, and related to the work injury. Claimant’s claim for medical benefits was denied and dismissed.

2014 Legislative Updates
The arrival of July means that the annual changes regarding benefits rates and statutory caps are implemented for 2014.  Effective July 1, 2014, the new benefits rates for injuries occurring on or after this date are as follows:

  • Maximum TTD weekly payout rate: $881.65
  • Maximum PPD weekly payout rate: $484.44
  • Scheduled impairment weekly payout rate: $277.03

The statutory caps for injuries occurring on or after July 1, 2014 have also changed, including:

  • Disfigurement for normal scarring and abnormalities: $4,673.47
  • Disfigurement for extensive scars or stumps: $9,345.38
  • Cap for combined indemnity for whole person rating of 25% or less: $81,435.67
  • Cap for combined indemnity for whole person rating above 25%: $162,869.28

Additionally, the legislature has signed into law several new bills or made changes to previous statutory provisions.  Some notable changes which became effective on July 1, 2014 include:

  • Settlement documents may now be submitted electronically to the Division, and orders of approval under C.R.S. §8-43-204(8) may be sent out electronically, making finalization of settlement agreements more efficient.
  • C.R.S. §8-43-201(3) now statutorily acknowledges that there is no requirement that the Director or an ALJ consider the medical treatment guidelines as a basis for determination of reasonable, necessary and related medical treatment, though the guidelines may be considered in this determination.
  • The date a hearing is required to commence from the notice to set on an Application for Hearing is now 120 days instead of 100, under C.R.S. §8-43-209(1).
  • The Director or an ALJ may now order out-of-state parties to appear in person for good cause shown and parties may be subject to penalties for failure to comply under C.R.S. §8-43-315(2) and (3).
  • Pursuant to C.R.S. §8-43-404(10)(a), an authorized treating provider (ATP) who refuses to treat for nonmedical reasons is now required to notify the worker within three days, explain the reasons for refusal, and offer to transfer medical records to a new authorized physician. Additionally, under this same statute, the Director or an ALJ has jurisdiction to determine whether discharge was for medical or nonmedical reasons.  The insurer must also designate a new authorized treating provider within 15 days of receipt of notice that the claimant was discharged.  The right of selection passes to the claimant where an insurer doesn’t timely comply.
  • The statutory aggregate for all lump sums under C.R.S. §8-43-406 has also changed, which varies based upon differing circumstances.

Additionally, the legislature signed bills which will not become effective until next year.  The most notable change includes a new provision that firefighters who suffer cardiac or circulatory illness as a result of a strenuous work event are given new mandatory employer-paid benefits, though this does not impact the determination of compensability for purposes of workers’ compensation and is not addressed under the Workers’ Compensation Act.  Perhaps most notably, the number of medical providers from which an injured worker may choose will increase to four beginning on April 1, 2015 next year.  We will address this change in more detail as this date approaches.

Cases You Should Know

Responsibility for Termination: In Adamson v. MNM Plumbing and Markel Insurance Company, W.C. No. 4-918-584 (ICAO, June 10, 2014), the ICAO upheld an ALJ’s determination that although the Claimant was terminated for being late to work, he was not responsible for his termination due to circumstances which were beyond his control.  The ALJ therefore awarded ongoing temporary disability benefits subsequent to the Claimant’s termination.  The termination statutes, C.R.S. §§8-42-105(4)(a) and 8-42-103(1)(g), both state that wage loss is not attributable to the work injury where an employee “is responsible for termination,” implying that the employee must be at fault. Under these statutes, the proximate cause of the employee’s termination is determinative of whether the employee was at fault and the totality of the circumstances are considered by an ALJ.  See Eckart v. Industrial Claim Appeals Office, 775 P.2d 97 (Colo. App. 1989).  In Adamson, the ALJ determined that the Claimant had difficulty sleeping the night before and was running late.  The Claimant also had to wait for a co-worker to arrive, upon which time the co-worker had to blow into a Breathalyzer device to start the Claimant’s vehicle.  These events were labeled as a “series of misadventures” by the ALJ which resulted in the Claimant being nearly two hours late to work.  As the ALJ determined that the cause of termination was Claimant’s tardiness and that these “misadventures” which resulted in the Claimant’s tardiness were “beyond his control,” the ALJ found that the Claimant was not responsible for his termination.Disfigurement Benefits: The ICAO upheld an ALJ’s finding that the Claimant was entitled to disfigurement benefits without medical evidence of causation in Fiske v. Echostar Communications Corp, W.C. No. 4-907-321 (ICAO, June 10, 2014).  The Claimant sought disfigurement benefits for a limp which he claimed was the result of work-related Dengue fever, contracted while he was on assignment in India.  However, the Claimant presented no medical opinion supporting a causal relationship between the fever and his limp at hearing.  Respondents presented a report from the treating physician which indicated the Claimant’s contention that his joint pain was caused by the fever was not medically sound.  The treating physician also criticized a report presented by the Claimant which he asserted supported his causal theory.  The ALJ nevertheless found that Claimant had established a prima facie case for benefits and Respondents had failed to present adequate evidence in defense.  The ICAO noted there was no legal requirement that a Claimant have medical evidence to support causation of disfigurement, also noting that no such requirement exists to prove a compensable injury or change in condition for purposes of reopening.  Instead, the ICAO stated that if any such requirement was intended, it would have been expressly included in the disfigurement statute by the legislature.

Dismissal of Claim Due to Claimant’s Failure to Obey an Order: In Gonzales v. University of Colorado Health and Travelers Indemnity Co., W.C. Nos. 4-865-972 and 4-851-350 (ICAO, June 12, 2014), the ICAO upheld dismissal of two consolidated workers’ compensation claims, with prejudice, due to the Claimant’s willful violation of a Prehearing Conference Order compelling discovery.  The Claimant sustained alleged injuries in 2010 and filed two claims, which were later consolidated.  Thereafter, the Claimant allowed the claims to remain largely dormant and filed an Application for Hearing only after Respondents sought to close the claims for failure to prosecute.  While hearing was pending, a PALJ ordered discovery compelled.  Prior to hearing, Respondents filed a motion to dismiss both claims for failure to comply with the Order.  The ALJ permitted dismissal under C.R.C.P. Rule 37 due to the violation of the Order because Respondents were highly prejudiced by the lack of discovery.  The Claimant was not permitted to re-file the claim.

Asserting Overpayment to Claimant with Third Party Subrogation Settlement: Respondent insurers may still claim an overpayment of benefits to the claimant as a credit against future benefits where there is an agreement between claimant and respondents to resolve a subrogation lien with a third party.  In Milazo v. Total Longterm Care, Inc. and Pinnacol Assurance, W.C. No. 4-852-795 (ICAO, June 11, 2014), the ICAO upheld an ALJ’s opinion determining that Respondents were not precluded from asserting an overpayment against Claimant where the parties had agreed to settle with a third party insurance company to satisfy an outstanding subrogation lien because Respondents had not expressly waived this right nor had they been estopped by a court.  ICAO stated that the subrogation statute, C.R.S. §8-41-203(1) operates to assign liability to the party at fault while preventing double recovery of workers’ compensation benefits by the claimant.  See Jordan v. Fonken & Stevens, P.C., 914 P.2d 394 (Colo. App. 1995).  While an insurer may waive the right to offset a claimant’s third party recovery against liability for future workers’ compensation benefits, there must be a voluntary, knowing, and intelligent waiver of this right.

Reopening Claim Based on Mistake of Fact: In Moran-Butler v. Healthone/Spalding Rehabilitation Hospital and Transportation Insurance Company, W.C. No. 4-424-488 (ICAO, June 5, 2014), the Court upheld the Director’s determination that reopening of the claim to determine the sufficiency of certain disability benefits was not appropriate under the facts of the claim.  The claimant was receiving Permanent Total Disability (PTD) benefits as the result of a 1999 work injury.  Subsequent to the determination of PTD, the parties underwent extensive litigation involving recalculation of benefits pursuant to a higher Average Weekly Wage (AWW) and an Order was issued in 2010 regarding how past due benefits were to be paid out.  Claimant did not file a timely appeal, but instead filed a Motion with the Director for determination of whether Respondents accurately calculated past due benefits and a request to reopen the claim on the basis of mistake of fact.  The Director determined that benefits were properly paid and that reopening was inappropriate because there was no mistake of fact, as Respondents had complied with the 2010 Order in payment of benefits.

Determining Whether a “Bonus” is Part of AWW Calculation:   In Yex v. ABC Supply Co., Inc., W.C. No. 4-910-373 (ICAO, May 16, 2014), the ICAO found that Claimant’s bonus should not be included in his AWW calculation because it was a fringe benefit, not wages.  The ALJ reasoned that the bonus did not fit under the statutory definition of “wages” because it did not have a present day cash equivalent value, the Claimant did not have access to the proceeds of the bonus on a day-to-day basis, and Claimant did not have an immediate expectation of receiving the bonus.   The ICAO labeled the bonus specifically a profit sharing plan.  Such plans are characteristically premised on the realization of a profit over a defined period of time.  Until that period of time is complete, the existence of any additional pay is entirely contingent.  Also, as in Orrell v. Coors Porcelain, the plan here required Claimant to be employed by the employer when the bonus was paid, a further barrier to the existence of any present cash value.

When Clear and Convincing Evidence is Required to Overcome DIME Conclusions:  In Zittel v. Pueblo County, W.C. No. 4-813-498 (ICAO, May 14, 2014), Respondents argued that Claimant was required to overcome the DIME physician’s findings of relatedness of Claimant’s cervical condition and the resulting surgery by clear and convincing evidence.  The ICAO stated that the opinions of the DIME physician are only subject to presumptive weight when expressly required by the statute, which is for MMI and medical impairment.  Cordova v. ICAO; C.R.S. §8-42-107(8)(b) and (c).  The DIME physician’s opinion on the relatedness of particular components of a claimant’s overall impairment and whether a claimant has reached MMI for those particular components carries presumptive weight; but, neither Claimant’s MMI status nor impairment was at issue here.  Thus, the Act contains no requirement for presumptive weight with respect to the reasonableness, necessity, and relatedness of requested medical treatment.  Once the DIME physician determines a claimant is not at MMI, and respondents do not challenge that decision, the normal rules for establishing entitlement to benefits apply (i.e. claimant must show entitlement to benefits by a preponderance of the evidence, which will be upheld if found by the ALJ, absent contrary substantial evidence.).

Defining “Employment” Under the “Firefighter Cancer Presumption Statute”:  InCity and County of Denver v. ICAO and Russell Snider, W.C. No. 4-820-266 (May 8, 2014, Colorado Court of Appeals), the Court of Appeals determined what constitutes “employment” for the purposes of calculating the five-year time period requirement under the “firefighter cancer presumption statute.”  This statute presumes that certain cancers contracted by firefighters with five or more years of service are compensable occupational diseases.  C.R.S. §8-41-209.  Claimant developed Leukemia, and the Court held that Claimant was entitled to medical benefits, as well as TPD and PPD based on the presumption of compensability created by the above cited statute.  In determining that Claimant had five years of “employment as a firefighter” required for the statutory presumption, the Court included Claimant’s four years of service as a volunteer firefighter and EMT for Elbert Fire Protection District and his training at the Rocky Mountain Fire Academy.  The Court noted that this five-year requirement is to ensure claimants are involved in the firefighting process and thus periodically exposed to the carcinogens found in fires.  Thus, the term “employment” includes a volunteer firefighter’s entire time of service, beginning with the time an individual commences service as a volunteer or commences training at the academy, not just the time of active engagement.  Additionally, the Court held that “employment as a firefighter” under the presumption statute was a matter of statewide concern, which does not change based upon employment with a certain municipality.

Evidence of Causation Required for Occupational Disease:       In Western States Fire Protection/API Group, Inc. and ACE American Insurance Company v. ICAO and Paul Olsen, W.C. No. 4-891-495, (March 27, 2014, Colorado Court of Appeals), the Court of Appeals addressed the relatedness of Claimant’s back injuries to his sitting in an old pick-up truck seat. In order to prove compensability of an occupational disease, a claimant must establish the existence of a disease and that it was directly and proximately caused by claimant’s employment or working conditions, and resulted from exposure to a hazard presented by those conditions, and the extent of the resulting disability.  The Court concluded that Claimant had established the statutory elements of an occupational disease.  There was no evidence that Claimant was exposed to any other hazard or condition that aggravated his back.  The Court noted that Claimant testified his back, even with degenerative disc disease, was asymptomatic until he drove the Employer’s truck.  The Court held that the evidence supported the ALJ’s conclusion that the seat caused Claimant’s occupational disease.  The Court additionally found that Claimant did not need to prove that the seat was defective in order to show compensability.  The Court further found that the evidence was specific to this case, and that the determination that this seat was a hazard to this Claimant was supported by evidence presented to the ALJ.

When is General Contractor Immune from Common Law Negligence as a “Statutory Employer?”:  In Pathong v. Tesco Corporation, No. 12-1455 (D.C.No.1: CV-00780-WJM-MJW) (D.Colo.), the 10th Circuit had to decide whether Tesco Corporation, as general contractor, was liable for the work injuries of its subcontractor.  Tesco Corporation contracted out drilling and personnel operations to a third party, with whom Claimant was injured when he sought relief under common law negligence.  The issue was whether Tesco enjoyed immunity from negligence claims under the Colorado Workers’ Compensation Act as a “statutory employer.”  The Act grants injured employees compensation from the employer without regard to negligence and, in return, the responsible employer is granted immunity from common-law negligence liability.  Section 8-41-401(1) of the Act makes general contractors ultimately responsible for injuries to employees of subcontractors.  However, under the statutory scheme, with this workers’ compensation liability comes immunity from common-law negligence liability.  To qualify for the immunity, a general contractor must carry workers’ compensation insurance per C.R.S. §8-41-401(1).  Whether a corporation is a statutory employer depends on the nature of the work contracted out.  To determine this, the Court used the “regular business test.”  The “regular business test” is satisfied where the disputed services are such a regular part of the statutory employer’s business that absent the contractor’s services, they would of necessity be provided by the employer’s own employees.  In other words, this is where the work is so essential that the business of the general contractor cannot continue to function without the task being performed by the subcontractor.  The Court held that even after contracting out its personnel services to operate the drilling rig to a third party, Tesco was still engaged in the drilling services business, and remained obligated to perform its duties under the contract.  Even as the general contractor subcontracting out the work on the rig, Tesco was still responsible for safety on the rig, providing the labor and equipment necessary to operate the rig, and designating the drilling locations and schedule.  Thus, as an important, routine, and regular part of Tesco’s business contracted out to the third party, Tesco maintained statutory immunity based on its status as a statutory employer.

legaLKonnection Firm Newsletter – June 2014

Thank you for taking the time to read our Firm newsletter. Our newsletter provides a monthly update on recent developments within our Firm, as well as in the workers’ compensation community.
In the News

Lee + Kinder is excited to welcome our newest Associate Attorney, Jenna Zerylnick.  Ms. Zerylnick earned a Bachelor of Science in Social Science Education from the University of Georgia in 2007.  In 2010, she graduated in the top 8% of her law school class at Florida Coastal School of Law.  During law school, Ms. Zerylnick participated in the Florida Supreme Court Internship Program for distinguished law students where she clerked for Florida Supreme Court Justice James Perry.  She also served as the manuscript editor for the editorial board of the Florida Coastal Law Review and a research assistant for a professor specializing in Mental Health and Disability Law.

Prior to joining Lee + Kinder, Ms. Zerylnick worked at a general civil law firm in Sterling, Colorado.  She practiced a variety of civil law, including personal injury, family law, school law, and probate/estate planning.  She also taught American Government as an adjunct instructor at Northeastern Junior College.  We are very happy to have Jenna join the L+K team!
Victory Lap

Of Counsel Joshua Brown was recently successful in overturning the granting of unemployment benefits in Shahan v. Austin & Ambrose LLC, d/b/a Press Play Bar. Mr. Shahan was previously terminated from his employment as the General Manager at Press Play Bar due to his unprofessional conduct with the City of Boulder’s police and liquor licensing officials.  After termination, Mr. Shahan filed for unemployment benefits, which initially was granted by the Colorado Department of Labor and Employment. Upon appeal, Mr. Brown successfully convinced the hearing officer that Mr. Shahan was at-fault for his termination, thereby disqualifying him from benefits under Colorado law. Specifically, Mr. Brown offered persuasive evidence that Mr. Shahan’s conduct was rude, insolent and offensive towards police officers and licensing officials that was not reasonably to be tolerated by the officers involved.  Accordingly, Mr. Shahan’s claim for unemployment benefits was denied and dismissed.

Cases You Should Know

Additional Exceptions to the Coming to and Going from Work Rule.  The ICAO recently added another exception to the coming to and going from work rule, which originally stated that injuries incurred while traveling to or from work were not compensable. In the Matter of the Claim of Alice Norman, Claimant, W.C. No. 4-919-557-01, 2014 WL 1694754 (Colo. Ind. Cl. App. Off. Apr. 23, 2014), the ICAO ruled that a Claimant’s injuries sustained while driving to work were compensable because her job sometimes required her to use her personal vehicle to travel to various locations during the work day. In this case, the employee was injured in a car accident while travelling on the same road she would have used to drive to her office. But the employee intended to make a stop at a courthouse to pick-up work-related paperwork before going to the office. The Court reasoned that if a job requires an employee to use a personal vehicle to travel, the employee’s travel to and from work confers a benefit upon the employer that constitutes more than the mere arrival of the employee at work. The ICAO held that because the Claimant’s travel to work was a benefit to the employer contemplated by the contract of hire, any injuries sustained while driving to work were compensable.  This case demonstrates that Colorado Courts continue to limit the coming to and going from work rule, and broaden the zone of compensable injuries.

There must be an Employment Relationship Between the Claimant and the Employer to Find the Employer Liable. The ICAO overturned an ALJ’s Order and dismissed a Professional Employer Organization (“PEO”) from the claim because the Claimant was not an employee of the PEO within the meaning of the Act. In the Matter of the Claim of Imogene D. Ritthaler, Claimant, W.C. No. 4-905-362-02, 2014 WL 1884714 (Colo. Ind. Cl. App. Off. May 7, 2014), the Service Agreement between a school and a PEO indicated that the PEO was only responsible for workers’ compensation claims of employees who were on the PEO payroll. The school notified the PEO that the Claimant was taken off the PEO payroll system after she had retired from teaching. Without notifying the PEO, the school continued to pay Claimant directly as a substitute teacher. Claimant subsequently sustained a work-related injury, and the PEO denied the claim stating that there was no insurance coverage. The ICAO held that in a co-employment relationship, the Claimant must be employed by each employer in order to hold both employers liable under the Workers’ Compensation Act. The ICAO determined that because there was no employment contract relationship between the Claimant and the PEO at the time of the injury, the PEO could not be held responsible as an employer.  The ICAO further explained that, irrespective of the contractual relationship between the school and the PEO, the PEO was not liable for the claim because the Claimant was not deemed an employee of the PEO.

Firefighter Cancer Presumption Statute’s 5-Year Requirement Includes Periods of Volunteer Firefighter Service and Training.  The Colorado Court of Appeals was asked to interpret the firefighter cancer presumption statute and determine what service qualifies when calculating the 5-year period of employment as a firefighter.  City & County of Denver v. Industrial Claim Appeals Office, 2014 COA 62 (May 8, 2014).  According to Section 8-41-209, C.R.S., there is a presumption that certain cancers are compensable when they are contracted by a Claimant who has completed 5 or more years of employment as a firefighter.  In this case, the Claimant developed leukemia after he had worked as a firefighter for less than 5 years. However, the Claimant worked as a volunteer firefighter for 4 years and trained at an academy for 17 months prior to becoming an official firefighter. The Court of Appeals ruled that the statute does not indicate what service qualifies when calculating the 5-year period. The Court held that the length of firefighting service begins to run from the date on which a volunteer firefighter fights his first actual training fire. Thus, Claimant’s service as a volunteer firefighter and training at the academy counted as part of his employment as a firefighter, which triggered the firefighter cancer presumption statute.

Demand Appointments are Not Subject to Requirements of IMEs.   Claimant presented to a demand appointment with his authorized treating physician (“ATP”). Claimant refused to proceed with the appointment because the physician did not provide him with an IME advisement form. Claimant also requested that the examination be recorded, but the physician refused to do so. Claimant’s benefits were then suspended by the claims examiner pursuant to C.R.S. §8-43-404(3), which provides that benefits shall be suspended if an injured worker refuses to submit for examination of a demand appointment. Claimant argued that because he was ordered to attend the examination, the physician was required to comply with the requirements IMEs set forth in C.R.S. §8-43-404(2). The ICAO held that an authorized treating provider is not subject to the provisions governing IMEs since the statute concerning “time to time” evaluations do not govern the procedures relevant to ATPs.  Johnston v. Hunter Douglas, Inc. and Liberty Mutual Insurance Company, W.C. No. 4-879-066 (ICAO May 29, 2014).

Concurrent Death Benefits Not Permitted. An employee was killed while working in Colorado. However, the Dependents, Decedent’s wife and son, were residents of Mississippi. Respondents admitted the claim for death benefits under Mississippi’s workers’ compensation act. The Dependents then made a claim for benefits under Colorado’s workers’ compensation system. The ALJ determined Colorado had jurisdiction and ordered benefits under Colorado law. The Dependents then sought concurrent benefits from both Mississippi and Colorado. The ICAO held that pursuant to C.R.S. §8-42-114, the Dependents were not entitled to recover the aggregate amount of benefits under the laws of both states. Keel v. Transportation Technology Services and ACE, W.C. No. 4-897-030 (ICAO April 21, 2014).

52 Weeks in a Calendar Year. Also in the Keel case, the dependents argued Social Security offset should be calculated using 52.14 weeks instead of 52 weeks. The ICAO held that 52 weeks is the correct way to calculate offsets as this is used by both the General Assembly and the Division of Workers’ Compensation.

Respondents are Not Entitled to a 50% Offset of Benefits Paid Under Alternative State’s Workers’ Compensation if Colorado had Jurisdiction Throughout the Life of the Claim. Also in the Keel case, the Dependents argued that Respondents miscalculated the interest due on past due benefits, as Respondents were not entitled to the 50% offset of benefits paid under Mississippi law. The ICAO held that because the ALJ found Colorado had jurisdiction over the claim, the benefits paid by Respondents according to Mississippi law should have been paid under the Colorado benefits statutes the entire time. Therefore, Respondents were precluded from taking a 50% offset of benefits paid for receipt of another state’s workers’ compensation benefits under C.R.S. §8-42-114. Thus, Respondents owed 8% interest for overdue benefits of the difference between what benefits were paid and what was owed under Colorado law.

Respondents Retain Right to Object to Requests to Change Provider Even if Right to Designate Provider was Initially Waived. Claimant alleged a work-related low-back injury and requested medical treatment, which was denied. Claimant treated with a personal provider at Peak Vista. Claimant pursued hearing on the issues of compensability and authorized provider. Claimant asserted Respondents waived their right to designate a provider pursuant to C.R.S. §8-43-404(5). In closing arguments, Claimant’s counsel stated that Peak Vista would not treat Claimant for a work injury and as a result Claimant wished to treat with Dr. Hall. Respondents objected to the authorization of Dr. Hall. The ALJ found the claim compensable and that Dr. Hall was the authorized provider. The ICAO reversed the ALJ’s determinations. The ICAO held that even if the employer initially waived the right to choose the authorized provider, in the “first instance,” such a waiver does not preclude it from having any right to object to subsequent changes. Lesso v McDonalds and Gallagher Bassett (as TPA), W.C. No. 4-915-708 (ICAO April 14, 2014). The case emphasizes that an injured worker must properly request a change of physician even when the injured workers’ personal physician is designated as the ATP.

Authorization for Surgery is Not an Implied Waiver to Future Request for Treatment to Same Body Part. Claimant sustained an admitted work injury to his right ankle in December 2012. However, Claimant had an extensive history of prior injuries and treatment to his right ankle, including surgery in July 2012. In February 2013, Respondents authorized right ankle surgery to install new hardware. Afterwards, Claimant sought authorization for another surgery to remove hardware. Dr. O’Brien opined the needed surgery was due to Claimant’s preexisting condition and not his work injury. Respondents denied authorization for the second surgery and Claimant pursued hearing. ALJ Stuber held the surgery was related to this claim because Respondents had authorized prior surgery to the right ankle. The ICAO held that, although Respondents paid for prior medical procedures, the payment of those respective procedures did not operate as a generalized admission of liability for future treatment related to the work injury. Rodolfo v. ACE Hardware and Fidelity & Guaranty Insurance Company, W.C. No. 4-906-748 (ICAO May 6, 2014).

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