10-6-2014; Does IL WC Really Want to Encourage/Reward Thieves?; "Hot Bin" Explosion Premises Liability Analyzed by Brad Smith, JD; The 800lb Pink Gorilla in Our Coming Election and more

Synopsis: Does the IL WC System Really Want to Encourage and Reward Thieves?

Editor’s Comment: As licensed Illinois attorneys and court-watchers, we confirm for our readers the strongest respect for the venerated members of our Appellate and Supreme Courts. The men and women on those judicial bodies are of the highest caliber and beyond reproach. They have to deal with civil litigation and criminal law at the highest level. They are entrusted with our safety and security in interpreting and creating our law.

That said, we consider the unexpected and odd turn that has occurred in IL workers’ compensation law and practice to be a problem for all judges, justices, lawyers and other participants in the system. This week, we read an appellate ruling which can only be characterized as surprising and unusual because it reverses the Commission and awards an admitted thief almost six months of temporary total disability benefits and almost completely ignores the crimes he committed. Having read the ruling several times, we don’t see any way to view this ruling in a fashion that doesn’t encourage and reward criminal behavior in the workers’ comp injury recovery process.

In Matuszcsak v. Workers’ Compensation Commission, No. 2-13-0532WC, issued September 30, 2014 Claimant worked for Wal-Mart for over three years as a full-time night stocker. His job duties included taking 5 to 100-pound boxes off skids and neatly placing products in proper areas. On March 7, 2010, there is no dispute Claimant injured his neck, back, and right arm at work when several fully stocked shelves of glass cleaner fell on top of him. On March 9, 2010, Claimant began seeking medical care. Thereafter, he received conservative treatment from various providers and was consistently given modified-duty work restrictions. Following his accident, Claimant returned to work for Wal-Mart in a light-duty capacity. On May 23, 2011, claimant saw Dr. Mark Lorenz, who recommended surgery on claimant’s cervical spine.

Claimant admitted under oath, on June 12, 2011, he was terminated from his employment at Wal-Mart for several incidents of theft wholly unrelated to his work injury. Thereafter, Claimant remained unemployed. On cross-examination Claimant agreed, at the time of his termination, he prepared a handwritten statement acknowledging he stole cigarettes from Wal-Mart on June 3, 2011, and on a “couple of days” in May 2011. He agreed, at the time he took the cigarettes, he understood that stealing is a crime and stealing from his employer could and did result in termination.

What is most challenging for our readers to contemplate, Claimant acknowledged under oath that, had he not repeatedly stolen cigarettes, he would still be working for Wal-Mart in a light-duty capacity at the time of arbitration. In effect, Petitioner admitted he should have been terminated for several crimes he committed. In states outside Illinois, when you admit you committed a serious crime, you lose your job and the pay that comes with it. In Illinois, it appears injured workers on light duty can lose their jobs for dangerous and anti-social behavior but keep the pay or benefits that come with the job, even though they have been fired. Claimant/Admitted Thief Wally Matuszcsak received an award of TTD amounting to over $7,550. As licensed Illinois lawyers sworn to uphold the Illinois Constitution and laws of this state, we completely disagree with this approach.

On January 25, 2012, the Arbitrator issued his decision and determined Claimant sustained accidental injuries and awarded

·         23-2/7 weeks TTD benefits from the date of termination for theft to the date of the Arbitration hearing;

·         $14,227.41 in medical expenses; and

·         Prospective medical expenses--the surgery recommended by Dr. Lorenz.

In awarding almost six months of TTD, the Arbitrator noted Claimant was subject to light-duty restrictions that were being accommodated by the employer at the time of his termination, Petitioner did not return to work elsewhere after being terminated, and Claimant testified he was looking for work within his restrictions. We note Respondent did not appear to demonstrate the availability of light work in the area around Petitioner’s home. From a defense perspective, we would have placed such evidence into the record either via lay or expert testimony.

The legal theory we consider flawed and lacking solid common sense comes from two closely related factual findings by the Arbitrator that follow the Illinois Supreme Court’s 2010 ruling in Interstate Scaffolding v. IWCC. The Arbitrator determined

1.    Claimant’s medical condition had not “stabilized at the time of arbitration” and

2.    Claimant had not reached maximum medical improvement or MMI.

In our view, those concepts are so closely aligned, they are effectively identical. When those factors were present in the record, the Arbitrator ruled temporary benefits were due on a continuing basis. Please understand Claimant’s condition was unquestionably “stable” to the extent he was able to perform light work and could have been doing so during the pendency of the litigation. The IWCC panel knocked out the TTD award in their decision, Judge Wheaton in DuPage County reinstated TTD and the Appellate Court affirmed reinstatement of 23+ weeks of TTD. In our view, the ruling of the Appellate Court, WC Division mandates an award of TTD as a “matter of law” without any regard for how egregious the conduct leading to termination might be.

The asserted lack of medical “stability” arises from the recommendation from a noted surgeon that a medical procedure needed to be performed at an unknown future time. The finding about maximum medical improvement or MMI is another aspect of dealing with IL WC law and practice—like medical stability, “maximum medical improvement” is a buzzword or legal term that doesn’t appear and isn’t defined in our IL WC Act or Rules Governing Practice. This means these two terms were judicially adopted or created and implemented by our reviewing courts. The courts can provide the definition of those not-particularly-clear terms, as they see fit. The problem with courts creating such concepts as “judicial legislation” is WC system participants only get the snapshot on the new legal terms that our courts provide on a relatively random and case-by-case basis—they have to wait for claims to reach them to outline their rulings based upon the new facts.

If you understand the basic precepts of workers’ compensation law, this relatively new and unprecedented legal requirement that TTD or lost time benefits are due until an injured worker reaches a medically stable situation or maximum medical improvement makes little sense to us. The term in the IL WC Act “temporary total disability” doesn’t appear to be challenging to interpret. To us, it means the worker can’t work at all due to a temporary, work-related medical condition. A significant percentage of workers with serious lost time injuries return to light work long before reaching a state of medical stability or maximum medical improvement. If you ask the great surgeons across our state, such as Dr. Michael I. Vender, Dr. Andrew S. Zelby or Dr. Brian J. Cole, they will confirm returning to light work following many serious injuries is an irreplaceable part of the medical recovery process. In short, if you can work light duty, you are no longer “temporarily totally disabled” from all work. We are also aware of a large number of workers who remain in light duty positions, awaiting approval or rejection of a request for surgery, as Plaintiff-Petitioner Matuszcsak did in the case we are reporting.

We ask all our readers including lawyers on both sides how it can make the slightest bit of common sense to reward a self-confessed thief who took himself out of the ongoing light work in the Wal-Mart work force for admittedly committing several crimes? Does anyone feel this is a good idea? We note the IWCC did not follow a “lock-step” approach in reaching their decision to award or deny TTD when someone on light work loses their jobs due to crimes. We salute these administrators for doing so. We note Plaintiff-Petitioner in the Interstate Scaffolding ruling did not admit to criminal behavior, as Claimant Matuszcsak did and there were many factual conflicts in the earlier claim—it was not clear-cut. We urge our reviewing courts to reconsider these rulings and give the great hearing officers at our Workers’ Compensation Commission the power to weigh such claims on their merits, particularly where clear evidence of criminal behavior is in the record.

The problem our IWCC Commissioners may have anticipated was what might have happened if Claimant Matuszcsak had committed a more serious crime and not just petty thefts. What if a worker on light duty “goes postal?” What if he/she killed, robbed or seriously injured an innocent victim? Would he or she still be entitled to TTD? What if they pled guilty and ended up in prison? Would they still be entitled to months or years of TTD benefits while behind bars? Does that make sense to anyone?

In our view, the ruling by the Appellate Court, WC Division in Matuszcsak which follows their view of the theories outlined by our Supreme Court in Interstate Scaffolding, has this significant legal concern. From our respectful view, if a Claimant on light duty in this state commits a job rule violation or misdemeanor or serious felony and thereby loses their job, these courts leave no “wiggle-room” for our administrators to deny TTD benefits. It is our further view such a strained legal rule rewards and thereby implicitly encourages Petitioners to commit crimes. It is our hope the Appellate Court, WC Division approves this claim for further review by our highest court and the members of that body take the case and provide the entire WC community with guidance on how to best handle such matters without implicitly or explicitly rewarding criminal behavior.

We appreciate your thoughts and comments. Please post them on our award-winning blog.

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Synopsis: Obtaining Expert Help For Premises Dangers Extinguishes Liability of Owner When The Expert’s Workers Are Injured. Analysis by Bradley J. Smith, JD. 

Editor’s Comment: In an intriguing and important premises-liability ruling that we consider required reading for risk managers, a recent opinion written by Judge Easterbrook, the federal Seventh Circuit Court of Appeals found a property owner was not liable for an independent contractor’s employees’ injuries, and further reversed the entry of punitive damages against the independent contractor. Please note this ruling may impact situations in which a safety engineer called to a premises to evaluate onsite dangers may not be able to sue the premises owner when they are injured due to the risk they were hired to prevent.

In Jentz v. ConAgra Foods, Inc., the problem was a “hot bin” or dangerous grain elevator. Explosions are a constant risk in grain storage, which produces not only a lot of combustible dust and carbon monoxide (which can oxidize explosively to carbon dioxide) but also, through the decay of a bin’s contents, heat that can set off a blast. In March 2010 ConAgra discovered a burning smell in bin C15, containing wheat pellets. ConAgra got in touch with West Side, which touts expertise in handling “hot bins.” ConAgra’s negotiations with West Side and its competitors delayed the start of work; West Side’s own busy schedule added to the delay.

Work finally began on April 20, 2010, and West Side hired A&J Bin Cleaning to do some of the necessary tasks. Two of the injured workers were employees of A&J; the third, Justin Becker, was employed by West Side itself. ConAgra wanted to salvage as much of the grain as possible, but as pellets were removed from the top more oxygen reached wheat composting at the bin’s bottom. West Side decided to remove some grain via side tunnels. On April 27, West Side employees detected smoke coming from the bin. Its crew sprayed water on the pellets and used an air lance to try to discover the smoke’s source; the effort failed. West Side’s foreman told ConAgra to call the fire department. Waiting for firefighters to arrive, the foreman for West Side  sent two of the Plaintiffs into a tunnel, instructing them to remove tools that might impair firefighters’ access. While they were there, the explosion occurred. They were severely injured in the blast.

After a seventeen (17) day trial, a jury awarded a whopping amount of nearly $180 million in compensatory and punitive damages against ConAgra Foods and West Side Salvage. ConAgra, which owned the facility, contended that liability rested on West Side, which it retained/hired the company to address the precise problems in the grain bin that led to the severe injuries to the West Side Salvage workers.. Both ConAgra and West Side contended the damages awarded were inappropriate and excessive. 

Normally, employees of an independent contractor cannot obtain damages from the owner of the premises at which the contractor or their employees were working. ConAgra contended Illinois law adopted the principle that someone who engaged an independent contractor to redress an unsafe condition is not liable when the feared dangerous event occurs.

West Side Salvage and the injured Plaintiffs unsuccessfully attempted to use the “firefighters’ rule.” However the Court quickly determined  West Side was not a volunteer, similar to a firefighter. In fact, they were hired to remediate the precise dangers leading to injuries. Accordingly, the normal rules of contract and tort law applied. Ultimately, the Seventh Circuit held ConAgra was not liable to these workers under tort law.

The Seventh Circuit also reasoned the $1 million punitive damages the jury ordered West Side to pay Jentz did not have proper evidentiary support. Particularly, under well-established Illinois law, an award of punitive damages requires willful and wanton conduct. The Seventh Circuit found the jury was presented with no evidence of willful and wanton conduct. 

Reasonably, contracting for help from an expert for a potential danger can and should shield a premises owner from liability if/when that feared dangerous event occurs.

This article was researched and written by Bradley J. Smith, J.D. Brad can be reached with any of your questions and concerns regarding general liability defense at bsmith@keefe-law.com.

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Synopsis: The 800lb Pink Gorilla in the Current Illinois State Election—Higher Income/Property Taxes Guaranteed with Doubling State and Chicago Government Pension Debt.

Editor’s comment: We are asking our readers a simple question—are you okay with Illinois state income taxes going to 8% on business income and personal income over $1M per year? Governor Quinn has already affirmed he wants state income tax to be 5% and House Speaker Madigan supports what we call the “Madigan-Hates-Millionaires-Tax” that will raise the top income tax rate in this state to 8%. Illinoisans are watching/listening to attack ads about silly things like nursing homes in 2003 and gift cards in 2005. No one appears to be addressing the major issues that are going to hit taxpayers very soon. Who can address any of it?

We are certain, if Governor Quinn is re-elected, significant state income tax hikes will happen next month, during the November veto session in our legislature. We will bet the legislation is already drafted. At the same time, Mayor Rahm Emanuel in Chicago is going to unleash millions in new property taxes that we assure you he is holding until the statewide election is over to avoid embarrassment to the Governor.

We just saw the Illinois Retail Merchants decide to sit on the fence and choose not endorse either candidate. We ask them to note an 8% income tax on their members is the equivalent of our State government grabbing one month or about 8% of gross annual income from all small, mid-sized and big businesses in our state. That can’t be a great idea for anyone who makes money in retail or health care or trading stocks/bonds or lawyers. We ask all the Plaintiff-Petitioner lawyers who read this KCB&A Update—are you ready to kick 8% of your gross income to the State of Illinois to fund our fake government pensions?

Democrats Need Republicans to Stay in This State, As We Are “Running Out of Other People’s Money”

Please also note Chicago Bears Quarterback Jay Cutler lives and is raising his family in Winnetka. The cost of an 8% state income tax to him will be $1,600,000 a year. He may be able to save substantial monies to move out of Illinois and return only for football practices and games. Lots of other businesses and successful individuals may also consider moving some or all of their operations outside Illinois to avoid the massive tax burden that may hit this state after the election. If the Democrats in power in this state push taxes/fees and tolls ever higher and higher, we are certain to see even more folks moving away from our state. As Illinois breadwinners and successful folks leave, the pressure on those who remain will heighten.

Even Dramatically Higher Taxes Probably Aren’t Going to Help Much—We Need a Groundbreaking Change in Illinois Government

As we advised, under Governor Quinn, Illinois State government debt was $54B just five years ago in 2009. It is over $105B right now. In five more years of mismanagement because nothing is being done to change the problem, it could be over $200B. The new spiraling taxes may fund some of the interest on all that debt but they won’t dent it. If/when it again doubles, we are going to be closer to a state government apocalypse. Are you okay with that?

Crain’s Chicago Business reported this week, the City of Chicago pensions' $37 Billion shortfall has doubled In 6 years under Democratic leadership in both Chicago and Springfield. This skyrocketing debt, according to a new report by the Civic Federation, is the total amount in unfunded liabilities for 10 local pension funds as of the end of fiscal 2012, two years ago. Total unfunded liability has been rising quickly, more than doubling since 2008, when it was $18.5 billion. But the increase from $32 billion in 2011 to $37.3 billion in 2012 was particularly large. If that doubles again and every indication is that it will, in the next five years, Chicago may be in federal bankruptcy court.

Why are they looking at 2012 figures? There's a lag in reporting because the watchdog group uses audited year-end financials from the 10 funds: the City of Chicago Police, Firefighters', Municipal and Laborers' funds; the Chicago Teachers' Pension Fund; and funds covering Cook County, the County Forest Preserve District, the Chicago Park District, Chicago Transit Authority and Metropolitan Water Reclamation District. In addition, Mayor Rahm Emanuel last year got through the Illinois Legislature and Governor Quinn a plan to revamp the much larger municipal and laborers' funds, an action that will require Chicago taxpayers to provide an additional $750 million in increased real estate taxes over the next five years. However, a related case involving state pension changes is headed to the Illinois Supreme Court, and if those are knocked out, Mr. Emanuel's recently approved changes could go, too. This will make the debt situation even more acute.

Even if those are upheld, no progress yet has been made on the Chicago teachers' pension fund, which was $8 billion short of having the assets required by the actuaries to meet its spending promises. And no progress has been made with the Chicago police and firefighter funds, which had just 30.8 percent and 24.4 percent of the needed assets on hand, respectively.

Please remember neither the participants in these funds are putting nearly enough money into the fake pensions nor are the respective governments putting enough in. As a single example, a Chicago school teacher only contributes 2% of their annual salary into their fake pension program. After twenty years, they are owed benefits for life and will get all their contributions back in less than a year on the pension.

As we tell our children, you have to fix things or the world will fix them for you. If you look at Governor Quinn’s campaign website right now, they aren’t addressing or even mentioning this 800lb pink gorilla. We hope Illinoisans are smart enough to see the treacherous path in front of us, find new leaders and not wait for the government apocalypse to start.

The election is on November 4, 2014. Please be sure to vote. We appreciate your thoughts and comments. Please post them on our award-winning blog.

9-29-14; FedEx Ruling Endangers Mandatory Accident Reporting Rules; "Distraction Exception" in Muni Sidewalk Claims Rev'd by IL Supreme Ct; Monster Legal Fee Award with analysis by Brad Smith and more

Synopsis: Federal District Court Rules FedEx Discharged A Worker in Retaliation for Not Providing Notice Prior to Getting Work-Related Medical Care.

Editor’s comment: We feel sure this ruling will be appealed to the Seventh Circuit Court of Appeals—in our view, it won’t stop at the District Court level and we will have to await the appellate outcome to be sure where it will all go. However, we are certain this ruling “endangers” or calls into question the legal viability of

Ø  Same-shift accident reporting rules or

Ø  Any requirement a worker first advise the employer before obtaining work-related medical attention.

As long-time court watchers and with respect to this august and veteran federal judge, we wholly disagree with the approach used. FedEx did not refuse to have this worker get medical care. We feel it is safe to assume the medical care obtained under the IL WC Act was paid for by the employer. Having read the decision, we don’t feel the employee was fired for needing and getting work-related medical attention. The termination was for not reporting the medical care until after it happened. There is no provision in the IL WC Act which makes it “illegal” for an employer to ask employees to timely report the need for medical care. In fact, there are hundreds of safety and personnel reasons supporting the need for such reporting.

As a rapid example, take the recent controversy about the employee who appears to have been suffering from severe psychiatric concerns. The damage done by him at the FAA radar facility in Aurora was so extensive the center might not be operational for several days. Thousands of flights were cancelled and the cost will be well into the millions. The suspect, who set several fires with rags and gasoline in the basement, managed to shut down all radar and communications systems in the facility. Would it be a bad thing for his employer to require him to report he was getting work-related psychiatric or other medical care?

In Stevenson v. FedEx, No. 13 C 138, published 9/24/14, there was no dispute about the basic facts. Defendant FedEx employed Plaintiff Stevenson as a package handler. As of January 2011, Stevenson was subject to a FedEx company policy that required immediate reporting of workplace injuries whether they required only minor first aid or medical treatment. In addition, FedEx policy required employees wishing to seek medical treatment for a workplace injury first attempt to provide advance notice to management via a free 24-hour phone line or other means. Under this company policy, failure to notify management before seeking work-related medical care could subject the employee to immediate termination.

On January 6, 2011, Stevenson reported to supervisors that he was suffering from a sore back. FedEx generated a First Aid/Injury Report and placed Stevenson on light duty to accommodate his condition. He did not request or seek medical treatment at that time. After working light duty for five days, Plaintiff Stevenson sought medical treatment for his back without first advising FedEx. The physician assistant or PA who examined him provided a “Certificate to Return to Work,” which cleared Stevenson to return to work. Stevenson began his next shift, as previously scheduled, at 10:30 p.m. on January 13 and worked until about 7:00 a.m. and worked light duty as FedEx had not yet returned him to regular duty. At the end of his shift, Stevenson presented the note from the PA, thereby notifying FedEx he had already sought and received medical care for the January 6 incident. Citing the company policy that required advance notice before seeking medical treatment for a prior workplace injury, FedEx terminated Stevenson’s employment.

Stevenson then brought a retaliatory discharge action. FedEx removed the action to the federal District Court. The federal court noted under Illinois law, it is unlawful for an employer to terminate an employee in retaliation for exercising a right guaranteed by the Illinois Workers’ Compensation Act. For claims alleging retaliatory discharge for the exercise of IWCA rights, the employee must prove

Ø  Status as an employee of Defendant;

Ø  Exercise of a right granted by the IL WC Act, and

Ø  Causal relationship between discharge and the exercise of that right.

The federal court indicated the parties agreed Stevenson was a FedEx employee and that a causal relationship exists between Stevenson’s actions and Stevenson’s termination. They simply disagree about whether all of his actions were protected. FedEx concedes the IL WC Act protects Stevenson’s actions in seeking medical care from his own provider and in later filing a Workers’ Compensation claim, but contends that the sole cause of his termination was not the fact he sought medical treatment but rather his failure to notify the company before he did so. The federal judge reviewed the motions of both parties and noted Plaintiff Stevenson did not dispute the cause of his termination: “Plaintiff admits he was terminated on January 17, 2011, for failing to notify his supervisors or management prior to seeking medical attention for a work injury.”

The federal judge also noted her feelings FedEx repeatedly mischaracterized Plaintiff’s argument as asserting his termination was based solely on the fact he sought medical treatment, ignoring Plaintiff’s repeated statements “Defendant unlawfully . . . interfered with Plaintiff’s rights by requiring him to notify his supervisor prior to seeking medical attention for a work injury.” The Court felt the remaining question, then, was whether the IL WC Act grants employees the right to seek medical care for a prior workplace injury without first notifying a supervisor.

Stevenson’s argument rests on the fact the IL WC Act prohibits employers from interfering with an employee’s attempt to exercise rights provided in the statute. The Illinois Workers’ Compensation Act provides, in relevant

part:

(h) It shall be unlawful for any employer . . . to interfere with, restrain or coerce an employee in any manner whatsoever in the exercise of the rights or remedies granted to him or her by this Act . . . . It shall be unlawful for any employer . . . to discharge . . . an employee because of the exercise of his or her rights or remedies granted to him or her by this Act.

Because one of the rights guaranteed by the IL WC Act is the right to seek medical treatment, Plaintiff Stevenson argued the IL WC Act therefore protects the right of employees to secure one’s own medical provider without interference “in any manner whatsoever.” In its briefs, FedEx did not dispute the legal premise of Stevenson’s argument the IL WC Act provides the right to seek medical care without interference. Rather, FedEx asserted its advance notification requirement does not interfere with the right of an injured worker to receive medical care and was justified by legitimate corporate and safety concerns.

FedEx raised several examples of workplace policies that have been recognized by the courts as valid defenses to retaliatory discharge claims, but those polices are easily distinguished from the policy challenged here; none involved action by an employer that imposed any precondition on an employee’s exercise of rights provided by the IL WC Act:

·         In McCoy v. Maytag Corp., 495 F.3d 515 (7th Cir. 2007), the employer terminated an employee who had failed to submit post-treatment status reports during a doctor-ordered leave of absence.

·         In Casanova v. American Airlines, Inc., 616 F.3d 695 (7th Cir. 2010), the employer was permitted to engage in post-treatment investigation and surveillance to determine whether an employee had fraudulently claimed a false injury, and could terminate the employee for lying and refusing to cooperate with the investigation.

·         Goode v. American Airlines, Inc., 741 F. Supp. 2d 877, 893–94 (N.D. Ill. 2010), endorsing the permissibility of a zero-tolerance policy against dishonesty in filing workers’ compensation claims.

In each of these cases cited above, this federal court felt violations of company policy occurred after the employees had already exercised some of their rights under the IL WC Act and in no way interfered with the employee’s ability to obtain medical treatment. In this case, by contrast, this federal court ruled Stevenson could not exercise his right to medical treatment without first complying with a policy imposed by the company that required him to take affirmative actions he would not otherwise have to take. The federal court ruled such actions by the employer were plainly “interference”—an act hampering action or procedure. As we indicate above, we feel any of the three cases above could arguably be ruled “retaliation” for the exercise of workers’ compensation rights—who cares when the worker is fired if the termination is for something that happened at any time during a workers’ comp claim?

We appreciate your thoughts and comments. Please post them on our award-winning blog.

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Synopsis: Keep Your Eyes on the Sidewalk! Important Illinois Supreme Court ruling on the “Open and Obvious” Doctrine as it relates to your City’s sidewalks. Analysis by Daniel J. Boddicker, JD. 

Editor’s Comment: In a decision that affects all Illinois municipalities, the Illinois Supreme Court determined the issue of whether the “distraction exception” to the open and obvious rule applied in a situation involving a known sidewalk defect.

In Bruns v. City of Centralia, Plaintiff Virginia Bruns stubbed her toe on a crack in the city sidewalk, which allegedly caused her to fall and injure her arm, leg, and knee. Prior to Plaintiff’s fall, she was looking towards the door and the steps of an eye clinic she was attending. Plaintiff testified to her prior knowledge of the sidewalk defect that had developed over a period of several years due to tree roots causing the sidewalk to crack and become uneven. The City was notified of prior trip and falls at the location, but decided not to authorize removal because of the 100-year-old tree’s historic significance.

Plaintiff alleged the City negligently maintained the sidewalk, failed to inspect and repair the sidewalk, and permitted the sidewalk to remain in a dangerous condition. Subsequently, the City filed a motion for summary judgment arguing the defect was open and obvious as a matter of law. Logically, the City further argued it was not required to foresee and protect against injuries from a potentially dangerous condition that was open and obvious.

Plaintiff countered by arguing the City should have reasonably foreseen a pedestrian could become distracted and fail to protect itself against the dangerous condition. The trial court granted the motion for summary judgment.

On appeal, our very liberal Fifth District Appellate Court disagreed and reversed the trial court. That court concluded the City had a duty to remedy the sidewalk defect in a reasonable time frame, but whether the City breached this duty was a fact question for the jury. The Appellate Court stated the key question is the foreseeability of the likelihood an individual’s attention may be distracted from the open and obvious condition, and it is certainly reasonable to foresee that an elderly patron of an eye clinic might have her attention focused on the pathway forward to the door and steps of the clinic as opposed to the path immediately underfoot.

The IL Supreme Court reasoned the only issue is whether under the facts the City owed a duty to plaintiff. It noted the four factors which guide the court on duty analysis as:

Ø  the reasonable foreseeability of the injury,

Ø  the likelihood of the injury,

Ø  the magnitude of the burden of guarding against the injury, and

Ø  the consequences of placing that burden on the defendant.

The Supreme Court further reasoned it also had to consider whether the distraction exception to the open and obvious rule applied. Accordingly, they reversed the Appellate Court and reinstated the trial court’s denial of the claim. In doing so, the Supreme Court held that looking elsewhere does not constitute a distraction. Instead, the essential determination is not whether Plaintiff was looking elsewhere, but why she was looking elsewhere.

This article was researched and written by Daniel J. Boddicker, J.D.  Dan can be reached with any of your questions or concerns regarding municipality defense and/or general liability defense at dboddicker@keefe-law.com

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Synopsis: Here is Another Reason You Need Reasonable Employment Law Defense Counsel from KCB&A! In a Seventh Circuit Opinion, Judge Easterbrook affirmed a local district judge's allocation of $325,000.00 in attorneys’ fees on a recovery of less than $50,000.00 for a violation of the FMLA. Analysis by Bradley J. Smith, J.D.

Editor's Comment: In a recent opinion written by Seventh Circuit Judge Easterbrook, the Seventh Circuit affirmed the District Court's award to the attorney of an employee $325,000.00 in a Family and Medical Leave Act ("FMLA") action, despite the fact the employee's recovery was less than $50,000.00. The District Court applied the principle that hyper-aggressive defendants who drive up the expense of litigation must pay the full costs/fees of the other side, even if the legal fees seem excessive in retrospect.

In Cuff v. Trans State Holdings, Inc., an employee, whom was an airline supplier's regional manager, represented the supplier and supplier’s two air carriers in their dealings with the airline and airport, brought a FMLA action against the air carriers. After extensive litigation, a partial summary judgment motion, and a jury trial, the employee recovered less than $50,000.00. However, the District Court awarded the prevailing employee attorneys’ fees pursuant to 29 U.S.C. § 2617(a)(3), which authorizes attorneys’ fees to a winning Plaintiff.

The Court noted Defendants injected numerous unnecessary issues and arguments into the case. For example, Defendants' lawyers contended Plaintiff was not qualified for FMLA leave because he was not taking prescribed medications. Instead, the court framed the proper issue before it as whether the employee has medical need for leave at the time he requested time off.

Defendants also attempted to present multiple pieces of “after-acquired evidence” at trial, but the District judge sustained objections based on Federal Rule of Evidence 403. Despite his rulings, Defendants failed to make an offer of proof of the proposed evidence. Consequently, the ruling’s prejudicial effects were waived by Defendants’ failure to preserve them through an offer of proof. 

The District Court judge reasoned the attorneys' fees award on the proposition that hyper-aggressive defendants who drive up the expense of litigation must pay the full costs, even if legal fees seem excessive in retrospect. The Seventh Circuit agreed and further reasoned the high total of attorneys' fees was an expected result of the way the defense was conducted. Accordingly, the Seventh Circuit affirmed the award of $325,000.00 in attorneys' fees coinciding with the less than $50,000.00 in actual recovery on the case. 

At Keefe, Campbell, Biery & Associates, LLC, we determine the most efficient and practical defense(s) to defend employment law claims brought against you. Although we always zealously defend our clients, we also keep in the forefront all facets of a claim to give our clients the best service possible. When there are the potential for attorneys’ fees awarded to the victorious party, we always include that factor in our initial assessment of the defense of a claim. If you have an employment law claim brought against you, then  reach out to the employment law defense team at Keefe, Campbell, Biery & Associates, LLC for an initial assessment of the claim.

This article was researched and written by Bradley J. Smith, J.D. Brad can be reached with any of your questions or concerns regarding employment law and general liability defense at bsmith@keefe-law.com.

9-22-14; Is the IL Gov't Apocalypse Drawing Near?; Big Cat Dodges Employment Law Bullet; How IL Judges-Legislators Can Make $1M Per Year of Service and more

SYNOPSIS: Is the Illinois Government Apocalypse Starting? Analysis by John P. Campbell, Jr., J.D.

EDITOR’S COMMENT: Illinois citizens willingness to perpetually fund spiraling government pensions through higher and higher taxes is hitting an apex. We recently saw the Village of North Riverside, IL seek a declaratory judgment allowing them to do away with their Municipal Fire Department. We feel this may be a sign of things to come in our state where municipalities can’t keep up with generous and ever-increasing government “pension” structures. We assure our readers many other Illinois municipalities may be starting similar litigation for the same reasons.

When we reviewed the recent lawsuit filed by the Village of North Riverside in Cook County Chancery Court we learned they are seeking a declaratory judgment from the Court permitting them to “outsource” fire protection and thereby, do away with their fire department. Crazy? Unsafe? Reckless? Well, when you peel back the onion and see the massive pension funding problem faced by the Village, you may come to realize that they have no choice.

It goes without saying, we all want readily available fire/police/emergency services for ourselves and our loved ones. However, there are reasonable alternatives, and as the pleadings in this case appear to accurately outline, a 540% increase in pension funding obligations over the past 10 years is simply unsustainable for North Riverside or any fiscally responsible village/city/municipality. The annual pension outlay per firefighter went from $8K per year in 2003 to $45,474 per year in 2013!

Why? Well, more firefighters are retiring and living longer; well out-pacing their earlier pension contributions. It’s simple math. You can’t fund your personal 401K with $7,500 per year for 20 years and then “withdraw” $40,000 each year for the next 30 years –your 401K would dry up long before. This is, in effect, what is happening to government pensions in North Riverside and many, many other Illinois communities. Something has to give at some point.

Aside from the safety concern with eliminating the department, the Firefighters Union no doubt will argue the “right” to the pension for members. While it sounds nice to have a “right” to endless pension dollars, we can’t help draw a parallel to private bankruptcy, where pension and 401K money is lost where the money simply runs out (Does Enron ring a bell?).

Why is a public pension like a firefighter union pension different? Well, they will be quick to point out the town is not really out of money, they just need to generate more money to feed the pension monster via either

(1) Significant program cuts in other municipal areas or

(2) Greatly raise real estate or other taxes, both now and in future years.

However, most municipal budgets are as lean as they can get since the economic downturn in 2008. As defense counsel for a number of municipalities, we know budgets have been trimmed to the extent possible while still providing basic services to citizens. So what’s left? Your tax dollars folks!

In effect, the only way to “bailout” the pension crisis is to dramatically raise taxes to cover costs. What happens with that solution if folks move away or don’t move to that Village/City due to the high tax cost? This “solution” also pits public employees with these pensions against the remaining private workforce, who will be asked to kick in more of their paycheck to cover someone else’s pension. The private sector worker may pause and think “wait a minute, I don’t have a guaranteed pension for life. Why should I pay into yours?” Not a pretty situation at all. The reason we feel this may be an apocalyptic change is to consider the next 10 years where the cost of such firefighter pensions might follow the same financial curve where the annual pension outlay per firefighter could be $100K or more. We again ask political leaders who support the current status quo, just how we are going to keep this house-of-cards afloat? Last year, both House Speaker Madigan and Senate President Cullerton sent letters to State union leaders for their plan on how to make financial sense of state pensions; we are unaware of any substantive response.

Let’s make one thing clear as well; a good portion of Illinois’ public pension crisis was not caused exclusively by over-generous pension structures demanded by unions. State, County and Local Governments have to look in the mirror as well and honestly ask whether they have adequately met their pension funding obligations over the past two decades or more. This is a lesser advertised but very real problem. One thing not addressed in the pleadings of this case that we reviewed is any mention of the equitable contribution to the pension by the municipality over the past 10-20 years. We would be curious to know if North Riverside met a realistic pension contribution schedule to sustain the health of the fund. This is often a source of great debate and will likely be argued as part of this litigation.

Is there a solution? Well, there are certainly options. The Village of Glencoe, Illinois for example, has had a combined “public safety” workforce for the past 17 years. Their firefighters are trained as police and vice versa. They recognized tremendous savings with this structure and this relatively affluent community has no reported complaints of deficient police/fire coverage. Glencoe may be the model for other Illinois communities struggling with these pension costs like Riverside. Unfortunately, it may take a protracted legal battle to forge such change. We will report on the Village of North Riverside’s efforts down the road.

This article was researched and written by John P. Campbell, Jr., J.D. Please send thoughts and comments to John at jcampbell@keefe-law.com.

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Synopsis: Is it wise to fire an employee who has made multiple, at times well founded, complaints with regard to harassment by co-workers? You may be surprised at the answer. Analysis by Shawn R. Biery, J.D.

Editor’s comment: We consider this an intriguing federal case which provides excellent guidance both to the extent that strong legitimate investigation can provide an excellent basis for multiple protections in defending future related litigation.

In Muhammad v. Caterpillar, Inc., No. 12-1723 (September 9, 2014) the Seventh Circuit affirmed the District courts grant of defendant-employer’s motion for summary judgment in a Title VII action alleging defendant had failed to take appropriate steps to stop plaintiff’s co-workers from subjecting him to sexual and racial harassment and claims for damage after subsequently suspended plaintiff in retaliation for complaining about said harassment.

By way of background, Warnether Muhammad alleged his coworkers at Caterpillar, Inc., created a hostile work environment by subjecting him to sexual and racial harassment and further argued his supervisor retaliated by suspending him after he complained about it. He was provided a right-to-sue letter from the Equal Employment Opportunity Commission, resulting in the suit discussed here. The federal district court however granted summary judgment for Caterpillar noting the company reasonably responded to the complaints of harassment, and no evidence suggested Caterpillar suspended Muhammad because he complained.

The court was clear to confirm they recite the facts in the record in the light most favorable to Muhammad. Suffice it to say, the offensive comments were both racially and sexually charged and came from three different employees, however they appear to have resulted in remedial action by the company after investigation. The company also responded to offensive comments which were scrawled on the walls of the bathroom nearest Muhammad’s with swift action being taken to immediately contact a third-party provider of painting services to have the graffiti painted over on several occasions. As part of the reporting, there was a discussion with Muhammad regarding following the chain of command in submitting complaints. The graffiti problem further was remedied by discussing it with all of Muhammad’s coworkers at a shift meeting, with another incident resulting in each person on Muhammad’s line being individually warned that anyone caught defacing the walls would be fired immediately. No more graffiti appeared.

Roughly six weeks later, an incident occurred that resulted in Muhammad’s suspension.

On that day, Muhammad left his work station during a non-break time to use the restroom, and checked the bid board for postings before returning to his station resulting in suspension pending the investigation of the alleged misconduct by the company. After that internal investigation, the suspension of Muhammad was deemed appropriate. Muhammad filed a grievance through his union representative and was allowed to return to work however was then later suspended a second time and then terminated based on his conduct with his coworkers upon his return. Following the settlement of his grievance of the termination, he returned to work at Caterpillar with no back pay, and was laid off due to a reduction in force in April 2009. He was later rehired at Caterpillar where he remains employed.

Based on incidents of August-October 2006, Muhammad filed his charges of harassment and retaliation with the EEOC, and in June 2009 he received his right-to-sue letter. Shortly thereafter he filed this suit, alleging that he was harassed with offensive comments about his perceived sexual orientation and his race and that Edwards suspended him in retaliation for reporting the offensive graffiti.

The federal district court granted summary judgment for Caterpillar. In rejecting the claim of sexual harassment, the court relied on the decision in Spearman v. Ford Motor Company, 231 F.3d 1080, 1085 (7th Cir. 2000), which held the Title VII prohibition on discrimination based on sex extended only to discrimination based on a person’s gender, and not that aimed at a person’s sexual orientation. The district court also ruled Caterpillar was not liable for any racial harassment by coworkers because, in the court’s view, the company’s responses to Muhammad’s complaints of harassment were reasonable. Finally, the court concluded Muhammad lacked evidence Edwards retaliated against him for complaining about the harassment.

The Court noted Muhammad’s argument, made for the first time on appeal, that his coworkers would not have harassed a female for her sexual preferences was speculation. At summary judgment, Muhammad did not produce evidence to support his assertions. They also noted that even if they set that problem aside, another more fundamental obstacle blocked Muhammad’s claim Caterpillar was liable for sexual and racial harassment: Caterpillar reasonably responded to Muhammad’s complaints. The evidence suggested there was only one secondary offensive remark and Muhammad admittedly did not report that secondary remark.

As for the graffiti, Caterpillar responded quickly each time Muhammad reported it, and stopped the problem permanently. Muhammad conceded the graffiti never reappeared after the individual warnings. The court accurately noted Title VII requires only that employers take action reasonably calculated to stop unlawful harassment; that requirement does not necessarily include disciplining the employees responsible for past conduct.

With those decisions, it left only Muhammad’s retaliation claim. Title VII also prohibits employers from retaliating against employees for their opposition to unlawful employment practices. However Muhammad only alleged the initial suspension constituted retaliation against him for his complaint of harassment. Caterpillar maintained Muhammad was suspended because he left his work station during a non-break time to check the bid board and when the supervisor Edwards attempted to discuss the impropriety of that action and other concerns with Muhammad, Muhammad responded disrespectfully, refused to talk with him, and walked away from him as he was speaking.

The federal court noted Muhammad made no effort to establish an admission of animus or to otherwise present direct evidence of it, and he failed to present evidence that rises above the type of speculation that is insufficient to survive summary judgment. Muhammad acknowledged he left his workstation during a non-break time to use the restroom, and he checked the bid board to see what jobs were posted in the plant before returning to the station. He conceded Edwards confronted him concerning his use of non-break time to check the bid board. Although he stated he did not walk away while Edwards was speaking to him, his testimony is vague as to what happened. He acknowledged in his testimony he did not want to discuss the situation with Edwards without union representation, and in his response to the motion for summary judgment he appears to employ that as a justification for his refusal to continue the conversation. Whether or not Muhammad walked away, it was undisputed Edwards approached Muhammad with a concern about his work performance, and some conflict arose in the course of discussing the matter.

The evidence submitted by Muhammad indicating the suspension was retaliatory in violation of Title VII was minimal. The court noted there was virtually no evidence, other than the possible temporal proximity, the conversation played a role in the suspension, and the courts have repeatedly held mere temporal proximity is rarely sufficient. There is no indication in the record the chain-of-command conversation was anything more than a reminder as to the proper procedures of the workforce. In fact, when asked in his deposition why he was suspended, Muhammad repeatedly stated either he did not know or he was told it was because of poor performance, not because of his complaint to Johnson. He later stated he believed it may be related to his decision to complain to Johnson directly about the harassment, but that was nothing more than speculation on his part.  Accordingly for multiple reasons, the federal appeals court ruled the district court did not err in granting summary judgment on the retaliation claim as well.

The goal in any similar situation is to ensure the allegations are investigated and to take appropriate action if applicable. A side note derived from a study of this claim is the knowledge that additional protections provided by such appropriate investigation and action can avoid damages for claims which may then be filed in retaliation if the employee is not satisfied with a result or if the investigation reveals some inappropriate behavior by the complaining employee. The decision may be tempered somewhat by the fact this plaintiff returned to work for the employer, however I prefer to believe the court simply decided appropriately on the facts at hand. This article was researched and written by Shawn R. Biery, J.D, MSCC. Shawn can be contacted at 312-756-3701 or sbiery@keefe-law.com.

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Synopsis: How Illinois Judges and Legislators can make more than $1M per each year of service. Do We Want to Pay This Much for Government Workers at Any Level?

Editor’s comment: Our readers asked and here are the answers. Please note everything we outline in this article is completely “legal” but in our opinion, shocking. Right now, Illinois’ full Circuit Court judges with their constitutionally guaranteed annual 3% increase will make $203,770.66. Four years from now, they will be making $222,592,62. In 14 years, their annual judicial salaries will be $299,145.87. 25 years from now, they will be making $414,087.84. This “spiral” won’t stop until the IL Constitution is changed. A traffic court judge can make more than our Governor, Attorney General or any statewide official.

For all the fanfare, you may want to also note only 3 of the 5 Illinois pension programs were “reformed” last year. Nothing about the IL pension “reform” bill passed last year, not a word, made any change to these painfully generous judicial or legislative “pensions.” In fact, the IL legislature couldn’t touch judicial pensions because their pensions are guaranteed in the IL Constitution and require a constitutional amendment to be modified. IL Judges/Justices are vested in their pensions in only 9 years of service. We have no idea who picked that odd number or why. If they vest and get out of the jobs after the vesting time period, neither our judges or legislators put in one full year’s salaries to then be entitled to lifetime “retirement” benefits. Would you contribute $100K to then get $9M back over your lifetime—who wouldn’t? The reason we put “retirement” in quotes above is very few of IL judges or legislators stop working, they just start getting money from us and move into other jobs.

Both retired IL judges and legislators will go through their entire “pension” contribution amount in less than one year after retirement. Upon retirement, a full Circuit Court judge and legislator gets 85% of their highest salary in annual pension payments. Therefore full Circuit Court judges currently retire at pensions of approximately $170,000 per year. In four years, that starting annual pension number will be $178,074.09. In 14 years, $239,316.69. Once their contribution and the state’s match is quickly used up, their pensions are “unfunded” or “de-funded” which means they return to our current taxpayer-paid payroll even though their work is long over.

So, Here is How An IL Judge Can Get $1M For Each Year of Service

·         As we outline, take as an example judge who gets his/her post at age 51.

·         They start working for us on a salary of $170K and rapidly come up to $203K. In nine years of service, they will receive just under $2M in salary.

·         When they retire, they will retire at about $170K or 85% of $203K. In the first ten years of “retirement or from age 60-70, they will receive $2M or so. Total income from us is now $4M.

·         In the next ten years, or from 70-80 years old, they will receive about $2.5M. Total income from us is now $6.5M.

·         If they live from 80-90 years of age, and lots of judges are living that long, they will receive more than $3M in that decade.

·         That means they will have received more than $9M for nine years of judicial work.

Please also note all retired judges and legislators receive fully paid lifetime medical coverage from our tax dollars. The IL Supreme Court just ruled that post-employment benefit is protected by the IL Constitution and can’t be touched for existing/vested retirees. To our understanding, this healthcare benefit is simply a “freebie” on your dime—retirees don’t contribute a penny to this expensive lifetime benefit. Here is a link to consider. Please note the judges/justices in this link retired some time ago; new retirees will get lots and lots more: http://www.chicagonow.com/dennis-byrnes-barbershop/2012/05/retired-illinois-judges-raking-in-gluttonous-pensions/

Please note the vast majority of the money to pay retired judges/justice is coming from you and I and our current tax dollars—yes, we are paying for judges and legislators who retired 10, 20, 30 years ago. Less than 30% of the money for these pensions is coming from the paltry contributions from our past and current judges and legislators. IL Auditor General William Holland confirmed both the judicial and legislative “pension” systems cost IL taxpayers over $100M each in current dollars. We also have to pay the cost of the interest on the money the State is borrowing to fund the “unfunded” amounts. We assure you the $105B in pension debt is gone/spent and will have to be paid back by you, me, your grandkids and their grandkids. That number continues to rise dramatically.

This isn’t sustainable and can’t be made sustainable—who will/can reform it?

We vote all the Illinois government pensions come under scrutiny or investigation. We don’t see that coming from Governor Quinn who we understand is strongly supported with millions in campaign cash coming from folks that want IL taxpayers to keep paying billions for fake pensions for former gov’t workers. Governor Quinn has been in office for six years and the pension deficit was less than $50B when he got the job—it is over $100B and could be over $200B if he is elected and no changes are made to these current and lucrative plans. Governor Quinn’s campaign website makes no mention of needed reforms to improve this pension mess.  Challenger Bruce Rauner is a successful and hard-working businessman and we hope his plans for moving new government workers into 401K plans is strongly considered. This crucial election is in 43 days, folks.

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