5-2-16; 'Dirty Lancing'- IL App. Court Again Reverses To Insure Benefits Awarded; Lindsay Vanderford Analyzes Important Kotecki Ruling; Shocking Child Support Judgmt--Don't Let It Happen to You

Synopsis: “Dirty Lancing”--Illinois Appellate Court, Workers’ Comp Division Maintains Its Role as a Super-Commission to Readily Reverse WC Denials.

Editor’s comment: Taking you back down the path of the “manifest weight of the evidence” rule in IL work comp, we remember the last two decisions on the subject for the IL Supreme Court were Sisbro and Twice Over Clean, both decided about a decade ago. In those rulings, the august members of our highest court were considering awards of benefits from the IL Work Comp Commission. When the decisions were taken on appeal to the IL Appellate Court, WC Division, the reviewing panels reversed to deny benefits. These well-reasoned and carefully thought-out Appellate Court decisions clearly outlined their view that a reviewing court could do so based on the “manifest weight of the evidence” rule. The Appellate Court found the facts didn’t match the record and denied. After lengthy consideration, the IL Supreme Court made it clear the interim reviewing courts weren’t to reverse on the facts and, they are only to reverse the IWCC when the opposite conclusion is very clearly apparent and there is no real support in the record for the factual decision the IWCC reached.

Once those rulings came down, most veteran defense lawyers, risk managers and claims handlers were unimpressed. As the years have rolled on, we have seen ruling after ruling come from the Appellate Court where WC denials mystically turn into benefit awards. It appears to have become so common, the current Appellate Court, WC rulings no longer even try to hide the obvious fact the Appellate Court in work comp appears to act as a “Super-Commission” to insert their own view of the facts whenever they feel it appropriate. In our respectful opinion, this is in direct contradiction to the rulings from the Supreme Court we cite above.

So, last week, we saw a new decision in Dunteman v. Illinois Workers' Compensation Comm'n, (issued April 29, 2016). In this ruling, Claimant filed an application for workers' compensation benefits for a foot blister sustained during work. In our view, the veteran and knowledgeable defense attorney for Big Cat or Caterpillar Tractor stipulated there was an “accident” when this Claimant’s foot rubbed in his shoe.

Claimant supposedly developed a blister on bottom of his left foot at work from having to repeatedly push a clutch down forcefully in operating a machine. A medical concern that clouded everything was Claimant was an uncontrolled diabetic. After Claimant lanced this foot blister using what he testified was his version of a sterilized needle, he later developed a serious infection in the foot that appeared to be due to diabetes and not the blister. Either way, for medical reasons clearly in dispute, the foot and toe required several foot surgeries and partial amputation of one toe.

As to lancing of the blister, the IL Appellate Court decision states:

The claimant testified that on or about June 25, 2011, while bathing, he noticed a water blister under the callus on the bottom of his left foot between his third and fourth toes. He went to the kitchen, sterilized a needle by boiling it in hot water on the stove, propped up his foot, and inserted the needle to relieve the pressure of the water blister. He testified that pure "water" drained from the blister. He then used peroxide on a cotton swab to wipe the area. He indicated that he had performed this procedure, which his mother had taught him at a young age, many times in the past without complications. He stated that no physician had ever told him not to pop blisters on his foot in this manner.

To our understanding the word “water” in the paragraph above isn’t water; it is opaque bodily liquid produced in infected tissue, consisting of dead white blood cells and bacteria with tissue debris and serum. There is a possibility Claimant caused infection to the tissue lanced due to any number of reasons, including how clean his hands were, the sanitation in the area where he lanced the blister and numerous other factors. Plaintiff’s counsel hired their medical version of a “hired gun” who said everything was related and caused by work.

Defense counsel for Caterpillar hired their medical version of a hired gun, a noted specialist who is board certified in internal medicine, occupational and environmental medicine, and public health and epidemiologic medicine. Caterpillar’s expert found no causal relationship between the surgeries and Claimant's work duties and asserted Claimant's infection "happened on the top of his foot, not on the bottom." Although this expert acknowledged Claimant's repetitive use of the clutch caused a foot blister and once a blister has formed, complications can arise from it, he believed that neither the blister nor the lancing of the blister contributed to the claimant's foot infection. The defense expert testified Claimant had uncontrolled diabetes and was not exercising proper diabetic foot care. He testified Claimant had roughened and chapped feet with slight cracking of the top of his left foot. On examination, this noted expert found brownish discoloration consistent with atrophic changes involving the left foot consistent with poor blood supply in addition to the lack of any diabetic foot care.

In reliance on this careful and clearly outlined expert testimony, the Commission panel denied benefits. In our view, there is strong support in the record for their determinations and factual findings. Based on the rulings in Sisbro and Twice Over Clean, the Commission decision should have been quickly affirmed by the reviewing courts.

Instead, we feel the Appellate Court, WC Division unanimously drew their own Plaintiff-focused conclusions, which they had to do to reverse. They ruled even if Claimant's lancing of blister was the immediate cause of infection, the infection would not have occurred "but for" the existence of work-related blister. Thus, his employment remained a cause of his current condition of ill-being.

We ask our readers to carefully consider the factual basis for the Commission’s decision is the lancing of the blister and the blister itself had nothing to do with the problem for which Claimant was being treated—the defense expert said there were problems away from the site of the blister and the “dirty lancing” issue. The defense expert felt the problems leading to surgeries and amputation of a toe were due to improper diabetic foot care and skin/tissue problems at a different part of the foot. If that is the basis for the IWCC ruling, how does the appellate panel properly substitute their own version of the facts and resolve medical issues wholly contrary to that of the IWCC? You have to decide--does that view comply with the last rulings of our highest court on factual issues?

Another concern for the IL business and insurance community is this ruling is going to be another demonstration of the unwillingness of our reviewing courts to join in the effort to rein in IL WC costs. Caterpillar CEO Douglas R. Oberhelman is a strident critic of the IL WC system and this ruling is going to be like throwing gasoline on a box of lit matches for him. We hope someone some day gets a message to the members of this appellate panel to try to act in a more moderate fashion while there are still a few large businesses like Caterpillar left in this state.

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Synopsis: The “Kotecki Cap” – Good To the Last (Shoe) Drop(s). Thoughts and Analysis by Lindsay R. Vanderford, JD.

Editor’s comment: The IL Appellate Court confirms a Kotecki defense is a set-off which does not have to be pled unless accident is at issue, and an employer can choose to waive its 5(b) lien after trial.

On April 28, 2016, the IL Court of Appeals for the Third District affirmed the Circuit Court in its decision in Burhmester v. Steve Spiess Construction, (issued April 28, 2016). The holding: an employer is not required to raise its Kotecki setoff limit or workers' compensation lien as an affirmative defense or before a trial. As it was undisputed Plaintiff Burhmester was an injured employee receiving compensation under the Illinois Workers Compensation Act from his employer, L.J. Keefe Co., there was no need for L.J. Keefe Co., who was the third-party Defendant in the civil action, to place the Kotecki issue before the jury by pleading an affirmative defense, and the court could address the issue by post-trial motion.

In brief reminder, Kotecki comes from a 1991 Illinois court decision involving a worker’s job-related injury. A contractor’s employee was hurt on the job and sued while working at a property owner’s location. After collecting workers’ compensation benefits, the worker sued the property owner for damages arising from his injury. The property owner then sued the worker’s employer for contribution. The suit resulted in the decision that an employer’s maximum liability for contribution is limited to the amount of the workers’ compensation claim. This is now referred to as the “Kotecki Cap.”

In Burhmester v. Steve Spiess Construction, Burhmester was working for an electrical subcontractor, L.J. Keefe Co., when he sustained a severe electrical shock. L.J. Keefe Co. was subcontracted by Spiess Construction, as the general. Burhmester brought a workers’ compensation claim against L.J. Keefe Co. and a negligence claim against Spiess Construction. Spiess Construction then filed a third party action against L.J. Keefe Co., attempting to assert L.J. Keefe Co. should contribute to any money damages awarded to Burhmester in the negligence claim.

At the close of evidence, Spiess Construction made an oral motion for a directed verdict against L.J. Keefe Co. asserting this employer had provided no evidence to establish its Kotecki claim. The trial denied the motion, deciding Kotecki automatically applies in contribution claims, and a claim under Kotecki does not need to be raised as an affirmative defense or proven at trial. The jury awarded Burhmester $534,608.82 and apportioned liability 20% to Burhmester, 30% to Spiess Construction, and 50% to L.J. Keefe Co.

L.J. Keefe Co. then filed a post-trial motion to waive its Section 5 lien and dismiss Speiss Construction’s contribution action. L.J. Keefe Co. argued it could choose to waive its workers’ compensation lien after trial. The trial court granted L.J. Keefe Co.’s motion to dismiss the complaint and vacated the judgment against L.J. Keefe Co. Spiess Construction was given a set-off of $95,487.23 (the amount of the WC lien).

On appeal, the Third District affirmed the trial court’s decision, noting case law including Kim v. Alvey, Inc. and LaFever v. Kemlite Co. which clearly allow an employer to raise its lien in a post-trial motion and that by waiving that lien, the employer may avoid liability for contribution to other parties allegedly responsible for the worker’s injury.

The Appellate Court clarified, “…a defense under the Act does not need to be plead before the matter is tried before a jury to be controlling. …[T]he fact that the plaintiff was an injured employee receiving compensation under the Act from L.J. Keefe Co. was not in dispute. Thus, there was no need for L.J. Keefe Co.  to place the issue before the jury by pleading an affirmative defense. Rather, the trial court could effectively address the issue by means of a post-trial motion.” Burhmester at 18. 

Thanks to this decision, we have a road map for protecting employers’ liens. If accident is at issue, be sure to plead the Kotecki setoff and provide evidence of the lien. No question of accident, no pleadings necessary. That lien remains enforceable until the final decision has come down, at which time, an employer can either enforce or waive the lien and remove itself from liability for contribution. A quick cost-benefit analysis can be performed, and the determination of whether to file that post-trial motion should be at hand.

This article was researched and written by Lindsay R. Vanderford, JD.  Lindsay can be reached with any questions related to workers’ compensation defense and employment law defense at lvanderford@keefe-law.com.


Synopsis: Remember WC Folks, Child Support Liens Attach to All Pending WC Claims and Benefits!

Editor’s comment: We get asked all the time about what liens will legally attach to work comp claims. The main kahuna of effective liens on WC benefits are child support liens. If you have notice of them in any fashion, you have to address them during payment of any WC benefit or settlement.

Failure to address and pay benefits can come with a hefty penalty. Last month, a Cook County Circuit Court Judge on issued one of the largest child support rulings in Illinois history, ordering Country Chevrolet Inc. in Herscher to pay $2.3 million in a case that originally was filed for $7,820 in past due payments! This massive judgment, levied by Cook County Judge Bonita Coleman, surpasses a previous case that went all the way up to the Illinois Supreme Court, ultimately resulting in a judgment of $1.2 million.

Plaintiff in this recent case, currently of Flossmoor, was married to Country Chevrolet's former finance manager. The mother argued the Herscher dealership intentionally shirked state law when it didn't withhold part of the finance manager’s earnings that should have gone toward child support. The mother filed the lawsuit in 2010 over $7,820 and Country Chevrolet eventually paid it. But under another part of the state's child support law, employers can be fined $100 per day for intentionally failing to withhold wages; and those overdue payments can be compounded.

While possibly being the largest child support amount ever granted by a judge in such a case, it is not the first ruling of its kind. The Illinois Supreme Court in 2007 upheld a ruling in favor of child support recipient for $1.2 million in penalties in a precedent-setting case. In recent years, the IL State Legislature has sought to strengthen child support laws by removing caps on penalties and damages.

Country Chevrolet attempted to defend itself by arguing the missed payments were clerical errors and the finance manager was an independent contractor — not an employee. In the ruling this week, Judge Coleman ruled Country Chevrolet's intentionally ignored withholding monthly child support payments. The company wrote a check that bounced, produced witnesses in court whom the judge deemed not credible and ultimately failed to make a convincing legal argument against the claims.

If you have questions and/or concerns about child support issue in a pending WC claim, feel free to send a reply on a 24/7/365 basis and we will get back to you to insure you are protected in handling resolution.



Synopsis: Kevin Boyle’s NEW Indiana WC RATE SHEETS ARE HERE, if you want the new one, just send an email!

Editor’s comment: We now have the even newer 2016 IN WC Rate Sheet, adding that recent Indiana WC mileage change. We are happy to send to anyone who asks. For IN WC adjusters, you still need to check your PPD Reserves and insure they are in line with the new rates. To get a complimentary copy, simply email Kevin at KBoyle@keefe-law.com and/or Alea at AMcNellis@keefe-law.com for Kevin Boyle’s Updated IN WC Rate-Sheet!

AGAIN—If you want just one or a dozen or more, simply reply to Kevin at KBoyle@keefe-law.com and/or Alea at AMcNellis@keefe-law.com  They will get a copy routed to you before they raise the rates again! Please confirm your mailing address if you would like laminated copies sent to your home or office!