Justia Insurance Law Opinion Summaries

In this insurance dispute arising from an employee's death, the Supreme Court remanded the determination that the employer's insurer providing underinsured motorist coverage and workers' compensation insurance was entitled to a lien on a portion of settlement proceeds received by the estate, holding that, given a lack of factual findings, there was no way to evaluate whether the court clearly erred in its assessment of the various factors impacting an equitable allocation.Charles Luze died in a work-related accident. His employer paid his wife, Jeanette Luze, workers' compensation benefits. Jeanette, as the representative of Charles's estate, then brought suit against the negligent driver and settled the claim. The estate also settled a claim against the New FB's insurer providing underinsured motorist coverage, Zurich American Insurance Company, which was also New FB's workers' compensation carrier. The circuit court determined that Zurich was entitled to a statutory workers' compensation lien on fifty percent of the settlement proceeds received by the estate and was able to subrogate against its own settlement payment of underinsured benefits. The Supreme Court remanded in part, holding (1) this Court was unable meaningfully to review the circuit court's allocation determination; and (2) the circuit court properly allowed Zurich to subrogate against the amount it paid in underinsured motorist benefits. View "Luze v. New FB Co." on Justia Law

After suffering two work-related injuries, Sheree Cleveland settled her workers’ compensation claims with Advance Auto Parts and its workers’ compensation insurance carrier, Indemnity Insurance Company of North America. The Workers’ Compensation Commission approved the settlement. Approximately one month later, the Employer/Carrier filed a Form B-31 indicating the last payment had been made. More than a year after that, Cleveland filed a motion asserting that the Employer/Carrier had not paid all compensation due under the settlement and that two medical bills remained outstanding. The Commission found that, because a one-year statute of limitations had expired, it lacked jurisdiction to enforce its order approving the settlement agreement. Cleveland appealed, and the Court of Appeals reversed, questioning whether the one-year statute of limitations applied to the claim. But instead of answering that question, the Court of Appeals found that the Employer/Carrier had been estopped from asserting a statute of limitations defense because it had agreed to pay the outstanding bills and had represented to the administrative law judge that it would do so. Further, the Court of Appeals also found Cleveland's contact with the Employer/Carrier within the limitations period tolled the statute of limitations, if, in fact, it applied. The Mississippi Supreme Court affirmed, but for different reasons than the appellate court. The Supreme Court determined the statute of limitations did not apply to Cleveland's motion for enforcement of the settlement order, therefore, her motion was timely filed. View "Cleveland v. Advance Auto Parts" on Justia Law

Cahill was the office administrator for the Family Vision optometry practice and handled insurance billings. She left her employment and filed for bankruptcy protection. About 90% of Family’s revenue came from claims submitted to VSP, which covers claims from optometrists only if they have “majority ownership and complete control” of their medical practices. VSP disburses payments after the provider signs an agreement certifying itself as “fully controlled and majority-owned” by an optometrist. At the time Cahill was submitting Family’s claims, the practice was actually owned by a practice management company with more than 150 surgery centers and other medical practices.About a year after Cahill left Family, the trustee of Cahill’s bankruptcy estate sued under the Insurance Claims Fraud Prevention Act, 740 ILCS 92/1, which added civil penalties to existing criminal remedies for fraud against private insurance companies and allows a claim to be raised on the state’s behalf by a private person (relator), in a qui tam action. The relator becomes entitled to remuneration if the lawsuit succeeds. A relator must be an “interested person” but the Act does not define that term.The Illinois Supreme Court affirmed the reinstatement of the case. A former employee-whistleblower with personal, nonpublic information of possible wrongdoing qualifies as an “interested person” under the Act and need not allege a personal claim, status, or right related to the proceeding. The state need not suffer money damages to partially assign its claim to a relator. The Act is intended to remedy fraud against private insurers, where the only injury to the state is to its sovereignty, based on a violation of criminal law. View "Leibowitz v. Family Vision Care, LLC" on Justia Law

The Supreme Court reversed the court of appeals' decision affirming the North Carolina Industrial Commission's finding that the uninsured/underinsured motorist (UIM) proceeds that Plaintiff received on behalf of her husband's estate through the settlement of a wrongful death lawsuit were subject to Defendants' subrogation lien under N.C. Gen. Stat. 97-10.2, holding that the UIM proceeds recovered from the wrongful death lawsuit may not be used to satisfy Defendants' workers' compensation lien.The decedent, Plaintiff's husband and an employee of Employer, was involved in a fatal motor vehicle accident with a third party in South Carolina. The Commission ordered Defendants to pay workers' compensation benefits to Plaintiff. Plaintiff then filed a wrongful death case seeking damages from the third party driver. The parties reached a settlement agreement that included recovery in the form of UIM proceeds. The workers' compensation insurance carrier for Employer subsequently claimed a lien on the UIM proceeds that Plaintiff recovered from the wrongful death settlement. The Commission ordered the distribution of Plaintiff's entire recovery from the South Carolina wrongful death settlement, concluding that Defendants were entitled to subrogation under section 97-10.2. The Supreme Court reversed, holding that Defendants may not satisfy their workers' compensation lien by collecting from Plaintiff's recovery of UIM proceeds in her South Carolina wrongful death settlement. View "Walker v. K&W Cafeterias" on Justia Law

The Supreme Court held that a health care provider who did not intervene in an employee's pending workers' compensation proceeding after receiving adequate notice of the right to intervene cannot initiate a collateral attack on the compensation award under Minn. Stat. 176.271, .291 or Minn. R. 1420.1850, subp. 3B.Scott Koehnen was injured during the course and scope of his employment for Flagship Marine Company. Koehnen received chiropractic treatment from Keith Johnson. Johnson submitted his charges to the workers' compensation insurer for Koehnen's employer, but both the employer and insurer (collectively, Flagship Marine) denied liability for Koehnen's injury. When Koehnen filed a claim petition seeking workers' compensation benefits his attorney sent a notice informing Johnson of his right to intervene. Johnson, however, did not move to intervene, and the proceeding continued without him. Koehnen and Flagship Marine subsequently entered into a settlement agreement. The compensation judge approved the stipulation for settlement and issued an award on stipulation. Johnson later filed a petition for payment of medical expenses pursuant to section 176.271, .291.The compensation judge dismissed the petition, and the Workers' Compensation Court of Appeals affirmed. The Supreme Court affirmed, holding that because Johnson chose not to intervene his petition was correctly dismissed. View "Koehnen v. Flagship Marine Co." on Justia Law

In 1983, Rice sought benefits under the Black Lung Benefits Act (BLBA), 30 U.S.C. 901–45. The Department of Labor (DOL) looks to employers that employed the miner for at least one year and are capable of paying benefits. The miner’s most recent employer that meets these requirements is the “responsible operator.” Employers must either qualify as a self-insurer or purchase BLBA insurance. KRCC operated a coal mine where Rice worked in 1982-1983 but he was employed by a separate corporate entity, KRMS, which charged KRCC for the cost of Rice’s labor. The entities' ownership and management overlapped; KRMS had no assets and operated out of KRCC's offices. KRCC obtained BLBA coverage from Bituminous Casualty but only listed 10 employees. The other 150 were employed by KRMS. An ALJ identified KRMS as the responsible operator, then denied Rice’s claim on the merits. Rice appealed; KRCC and Bituminous successfully moved to be dismissed from the case, because the ALJ identified KRMS as the responsible operator.In 2002, Rice filed another BLBA claim. DOL again notified KRCC and Bituminous that KRCC might be the responsible operator. Bituminous claims it “denied coverage based on the fraudulent arrangements” between KRCC and KRMS. DOL refused to dismiss Bituminous.The Sixth Circuit affirmed, rejecting arguments that DOL was collaterally estopped from finding that KRCC was the responsible operator; that Bituminous was entitled to rescind its insurance agreement based on fraud by KRCC; and that delays in DOL administrative proceedings violated its right to due process. View "Karst Robbins Coal Co. v. Director, Office of Workers’ Compensation Programs" on Justia Law

After claimant Danny Arvidson received an award of permanent total disability, insurer Liberty Northwest Insurance Corporation requested a hearing before an administrative law judge (ALJ) to review the award. The ALJ dismissed insurer’s hearing request as time-barred. The question on review before the Oregon Supreme Court was whether that dismissal entitled claimant to attorney fees under ORS 656.382(2), which provided that, if an insurer initiates review of a compensation award and the reviewing body “finds that ... all or part of the compensation awarded ... should not be reduced or disallowed,” the insurer shall pay the claimant’s attorney a “reasonable attorney fee.” The ALJ determined that the statute applied to the dismissal of insurer’s claim and awarded fees to claimant. The Workers’ Compensation Board reached a different conclusion and reversed that decision. The Court of Appeals affirmed without opinion. The Oregon Supreme Court reversed, finding the ALJ correctly determined that his dismissal of insurer’s request for hearing entitled claimant to attorney fees. The board erred in concluding otherwise. View "Arvidson v. Liberty Northwest Ins. Corp." on Justia Law

In this dispute over the amount that air ambulance providers may recover from workers' compensation insurers, the Supreme Court held that Texas law requiring that private insurance companies reimburse the fair and reasonable medical expenses of injured workers is not preempted by a federal law deregulating aviation and that federal law does not require Texas to mandate reimbursement of more than a fair and reasonable amount for air ambulance services.PHI Air Medical, LLC, an air ambulance provider, argued that the federal Airline Deregulation Act (ADA) preempted the Texas Workers' Compensation Act's (TWCA) fee schedules and reimbursement standards. An administrative law judge held that PHI was entitled to reimbursement under the TWCA's standards. On judicial review, the trial court declared that the ADA did not preempt the TWCA's reimbursement provisions. The court of appeals reversed. The Supreme Court reversed, holding (1) because the price of PHI's service to injured workers is not significantly affected by a reasonableness standard for third-party reimbursement of those services, the ADA does not preempt that standard; and (2) the ADA does not require that Texas compel private insurers to reimburse the full charges billed for those services. View "Texas Mutual Insurance Co. v. PHI Air Medical, LLC" on Justia Law

Travelers Insurance Co. appealed a district court decision to affirm a final order of the Idaho Department of Insurance in favor of Ultimate Logistics, LLC (“Ultimate”). The Department of Insurance’s final order upheld a hearing officer’s determination that two mechanics working for Ultimate were improperly included in a premium-rate calculation made by Travelers. In its petition for review, Travelers argued the Department of Insurance acted outside the scope of its statutory authority in determining that the mechanics could not be included in the premium-rate calculation. The district court rejected this argument. Finding no reversible error in the district court's order, the Idaho Supreme Court affirmed. View "Travelers Insurance v. Ultimate Logistics, LLC" on Justia Law

Rochelle Frett was injured when she slipped and fell at her place of employment during a scheduled lunch break. She filed a claim for benefits under the Workers’ Compensation Act, but the State Board of Workers’ Compensation denied her claim. Frett appealed, and the superior court upheld the denial of her claim. Frett then appealed the decision of the superior court, and the Court of Appeals affirmed. Relying on Ocean Acc. & Guar. Corp. v. Farr, 178 SE 728 (1935), the Court of Appeals held that Frett suffered no injury compensable under the Act because she sustained her injury during a scheduled break, and her injury, therefore, did not arise out of her employment. The Georgia Supreme Court issued a writ of certiorari to reconsider Farr and reviewed the decision of the Court of Appeals in this case. The Supreme Court overruled Farr, and reversed the decision below. View "Frett v. State Farm Employee Workers Compensation" on Justia Law