Workers Compensation Insurance Company Expert Witness: “That’s the game, baby”

The New York Times, in a series discussing the outrages of the workers compensation system in that state, today reports on the role of “independent medical experts” hired by workers compensation insurance companies, “A World of Hurt: Exams of Injured Workers Fuel Mutual Mistrust.” In explaining why his written report stating that an injured worker was not injured in contrast to his videotaped statements made when he was actually examining the the injured employee, a doctor who had been hired by an insurance company to examine the man said, according to the Times:

“If you did a truly pure report,” he said later in an interview, “you’d be out on your ears and the insurers wouldn’t pay for it. You have to give them what they want, or you’re in Florida. That’s the game, baby.”

Fraudulent medical opinions that cause denial of valid workers compensation claims were part of the focus of a case decided last year, Brown v. Cassens Transport. That case ruled that injured workers denied workers compensation benefits by fraudulent medical opinions may sue for money damages under the federal racketeering law RICO. Robert L. Abell wrote an article for the Kentucky Justice Association‘s publication, The Advocate, earlier this year, “Injured Workers May Pursue Civil RICO Claim Based On Enterprise To Deny Them Workers’ Compensation Benefits.”

Robert L. Abell
www.RobertAbellLaw.com

Injured Workers May Sue Under Racketeering Law Based On Scheme To Deny Them Workers Compensation Benefits

Injured workers may pursue civil claims for damages under the federal racketeering law known as RICO (Racketeer Influenced Corrupt Organizations) based on a scheme to wrongfully deny them workers compensation benefits the Sixth Circuit ruled today in Brown v. Cassens Transport Co., No. 05-2089.  The plaintiffs, a group of six injured workers, claimed that their employer, Cassens Transport Company, the company that administered Cassens’s workers compensation claims, Crawford & Company, and a doctor, Saul Margules, “employed mail and wire fraud in a scheme to deny them worker’s compensation benefits.”  More specifically, the injured workers alleged that “Cassens and Crawford deliberately selected and paid unqualified doctors, including Margules, to give fraudulent medical opinions that would support the denial of worker’s compensation benefits, and that defendants ignored other medical evidence in denying them benefits.”  A copy of the workers’ complaint can be read here. 

The court, in reversing a district court decision dismissing the case, ruled that the workers had pleaded a pattern of racketeering activity based on the following commonalities of the defendants’ acts: (1) the common purpose of reducing “Cassens’s payment obligations towards worker’s compensation benefits by fraudulently denying worker’s compensation benefits to which the employees are lawfully entitled”; (2) the common result of denying “worker’s compensation benefits to certain Cassen’s employees who are entitled to such benefits under Michigan law”; (3) common participants including worker’s compensation officials at Cassens and Crawford and “Margules, a doctor who the plaintiffs allege, with regard to some of the predicate acts, fraudulently recommended ineligibility of benefits at the request of Cassens and Crawford”; (4) common victims in the injured employees eligible for but wrongfully denied worker’s compensation benefits; and (5) similar methods of commission, the fraudulent application of legal standards to wrongfully deny worker’s compensation benefits to eligible employees.  The court further held that the defendants’ predicate acts were continuous under both closed- or open-ended theories because they had gone on for a time span “well over three years” and were alleged to have been defendants’ standard way of doing business: “fraudulently denying benefits to which the employees are entitled through the use of fraudulent communications by mail and wire.” 

The court also addressed two other RICO issues.  First, that reliance by the injured workers on defendants’ fraudulent misrepresentations was not an element of a civil RICO claim based on a Supreme Court ruling in Bridge v. Phoenix Bond & Indem. Co., No. 07-210 (June 9, 2008).  Second, the workers pleaded a compensable RICO injury because “the defendants’ fraudulent acts were a ‘substantial and foreseeable cause’ of the injuried alleged by the plaintiffs: the deprivation of their workers’ compensation benefits and expenses for attorney fees and medical care.” 

This case outlines a path by which injured workers may obtain relief from schemes by employers, insurance companies and doctors aimed not at dealing with the true and real facts but at wrongfully denying benefits to truly and legitimately injured workers.  It should also raise a flag of caution for those insurance companies and doctors that reflexively oppose and deny the claims of truly and legitimately injured workers.

The Kentucky Justice Association published an article authored by Robert L. Abell on this case in its January/February 2009 issue of its publication, The Advocate, “Injured Workers May Pursue Civil RICO Claim Based on Enterprise To Deny Them Workers’ Compensation Benefits.

Robert L. Abell
www.RobertAbellLaw.com