1st DCA Sets Oral Argument in Dispute about Worker's PTD Award

"...he understood the Labor Code as only allowing for apportionment if there is 'an overlap' between the prior injury and a later injury. Alan Gurvey represented the injured worker in the Pacific Compensation Insurance Co. case. He said that case had turned on the fact that his client's inability to work was entirely due to 'symptoms that were separate from the nonindustrial injuries.'"   Alan Gurvey

The California 1st District Court of Appeals will hear oral arguments next month in a case where an administrative law judge found a worker was permanently and totally disabled from a cumulative trauma injury causing hearing loss, without apportionment for his previously established permanent disability from hearing loss, based on the opinion of a vocational expert about his lost future earning capacity. 

ACME Steel et al. v. WCAB (Borman), No. A137915, is the second case to be granted review this year involving workers who were deemed permanently and totally disabled based upon their loss of future earning capacity.

The case involves a claim by ACME Steel employee Michael Borman. He had filed a claim in 1994 for hearing loss and received a stipulated award based on a 22% permanent disability rating. As the time passed, his condition worsened. 

Borman got cochlear implants and filed another claim for benefits. 

At the hearing on this later claim, a vocational expert testified that Borman's cochlear implants would prohibit him from participating in the open labor market.

Administrative Law Judge Deborah Lieberman agreed that there was no possible job which could accommodate Borman's difficulty with oral communication and other physical limitations, and so he was permanently and totally disabled under the 2005 Permanent Disability Rating Schedule. 

She declined to apportion any liability for Borman's condition to his 1994 claim, because he had suffered no loss of earnings at that point.

After the Workers' Compensation Appeals Board declined reconsideration of Lieberman's decision, ACME sought judicial review in February, and the 1st DCA last Wednesday agreed to hear the case.

Borman's attorney, Thomas Marshall Pegnim of Pegnim & Ivancich, requested oral argument and the court on Tuesday issued notice that the case will be heard by Justices Robert Dondero and Kathleen Banke of the 1st DCA's Division 1 and retired Division 4 Justice Patricia Sepulveda on June 11.

Pegnim could not be reached for comment on Wednesday or Thursday, and ACME's attorney, Steven Wade Cox of Wai & Connor, declined to comment. 

A case involving similar issues of apportionment and lost earning capacity is currently pending before the 2nd DCA's Division 4 and is called Southern California Edison v. WCAB (Martinez), No. B245118.

That case involves a dispute about an award of permanent and total disability benefits to former Southern California Edison scientist Elsie Martinez.

Martinez had asserted a claim for a cumulative trauma injury to her spine, shoulders, wrists and hands, which developed as a result of the repetitive nature of her work during a continuous period from February 1998 until May 2004. 

Edison accepted liability for these injuries but disputed Martinez's later claim that the cumulative trauma had caused her to develop fibromyalgia.

Martinez underwent an independent medical examination by Dr. Seymour Levine, a rheumatologist. Levine opined that Martinez was unable to work because of the combination of her symptoms from the cumulative trauma injuries and her fibromyalgia.

Workers' Compensation Administrative Law Judge Robert Spoeri found Levine's opinion persuasive and awarded Martinez permanent total disability benefits. 

That same day, Spoeri also issued Martinez an award of benefits for a specific injury to her neck, right shoulder, right wrist, right hand and psyche that had occurred in June 2001. Spoeri found Martinez was 29% permanently disabled as a result of that injury.

Edison unsuccessfully sought reconsideration by the Workers' Compensation Appeals Board of both awards, and then petitioned the 2nd DCA for writ relief last November. The California Workers' Compensation Institute and the California Chamber of Commerce filed amicus briefs urging the court to review the case. The 2nd DCA granted writ in April.

On appeal, Edison is arguing that "(i)t defies logic and the uncontradicted evidence that the (29% disability rating assigned to Martinez's 2001 specific injury) was not subtracted from the subsequent injury disability which involves all of the same body parts and was decided based on the same medical reports."

Martinez's attorney, Lawrence Silver of Goldschmid Silver & Spindel, has countered that "the body parts don't overlap" pursuant to Labor Code Section 4664(c)(1), which defines the different "regions of the body" for purposes of assigning permanent disability percentages. 

Section 4664(c)(1) subsections (A) through (F) identify a person's hearing, vision, mental disorders, the spines, the upper extremities and the lower extremities all as separate "regions of the body." Silver insisted Martinez's alleged specific injury dealt with problems in those regions. Her fibromyalgia, however, comes under subsection (G), which is the catch-all provision, which makes it a different "region of the body" than those affected by her 2001 injury. 

The California Applicants' Attorneys Association filed an amicus brief in support of Martinez on Friday, and oral argument is set for July 18.

Earlier this year, the 2nd DCA was also asked to consider whether an employer can apportion liability for a permanent and total disability caused by a worker's loss of earning capacity if the worker also has limitations caused by nonindustrial medical conditions.

The 2nd DCA, however, summarily declined review of the case, which was Pacific Compensation Insurance Co. v. WCAB (Nilsen), on May 10.

Ellen Sims Langille of Finnegan Marks Theofel & Desmond, counsel for the carrier, filed a petition for writ relief with the California Supreme Court on Friday. 

Michael McClain, general counsel for the CWCI, said he has noticed that "a lot of applicant attorneys are using vocational experts to establish future earning capacity," as illustrated by these three cases. 

However he said he did not think that establishing a diminished future earning capacity should mean that apportionment is not appropriate.

Apportionment, McClain said, is "very important" to employers and carriers, because the law "says employers are only responsible for the impairment and disability caused by an industrial injury," and the Labor Code specifically allows an employer to apportion to a preexisting disability. 

But applicant attorney Alan Zane Gurvey of Rowen, Gurvey & Win said he understood the Labor Code as only allowing for apportionment if there is "an overlap" between the prior injury and a later injury.

Gurvey represented the injured worker in the Pacific Compensation Insurance Co. case. He said that case had turned on the fact that his client's inability to work was entirely due to "symptoms that were separate from the nonindustrial injuries."

The worker, Gregory Nilsen, had a significant documented history of treatment for his lumbar spine, degenerative joint disease, chronic pain and anxiety disorder before his industrial injury, but Administrative Law Judge William Carero reasoned that none of these conditions contributed to Nilsen's total loss of earning capacity after his February 2007 workplace accident. 

Gurvey said he thinks this means that the question of when to apportion "comes down to what causes the total loss of earning capacity." 

A judge has to look at the worker's most recent injury and determine if that condition alone was responsible for the worker's total loss of earning capacity, he opined. If so, then an award of permanent and total disability benefits would be appropriate, even if the worker had a preexisting injury or condition that partially disabled him. 

For example, Gurvey said, if a worker had a permanent partial disability from a broken leg but was able to work, then had a catastrophic accident in which the worker lost both legs and was unable to continue working, then that worker should get permanent total disability benefits based on his lost earning capacity from the loss of both legs.

Gurvey said he thought California case law has established that "a permanent disability can be defined by a total loss of earning capacity," and this remains the law, despite the passage of SB 863 last year. 

Labor Code Section 139.48, part of the reforms created by SB 863, shifts liability from an employer to a $120 million special fund, which was to be created for the purpose of making supplemental payments to workers whose permanent disability benefits are disproportionately low in comparison to their earnings losses. CWCI, in its amicus brief in the Pacific Compensation Insurance Co. case, had taken the position that SB 863 required liability for Nilsen's injury to be apportioned between his employer and the as-yet-to-be-created fund. 

Gurvey said he did not think the enactment of a new statute could "do away with precedential case law," and predicted "that's why we're going to have a lot of litigation on these issues."

Published on 05/24/2013 by WorkCompCentral, authored by Sherri Okamoto