Keefe, Campbell & Associates, LLC

Editor’s comment: We report this to be sure everyone in HR, benefits and safety is aware of it for future preventative measures and training. Without intending to sound insensitive, we ask our readers to tell us how this amount of money can bear any semblance of common sense when one considers this young lady has no visible or permanent physical injury of any kind. Yes, we do feel bad for her and we are certain she had some psychological impact but, in our minds, she will be laughing while toting her millions in a stretch limo all the way to the bank.

We consider this a patent example of an awful fact of American life and modern personal injury litigation–something bad happened so a random corporate defendant has to pay heavily. We feel one could just as easily have blamed the phone company for providing the phones used in the scam, the surveillance camera installers who put in cameras that recorded the event but didn’t stop it or any random police department you want to pick—their “culpability” for the bad and unfortunate choices made by the employees of McDonalds during and after this event was just as strained. When the U.S. personal injury system starts to look like a poor person’s lottery, as it does here, we think reforms are needed.

At some point, starting in the mid-1990s, some moron started to call fast food restaurants and masquerade as the local police, FBI or other authority. The caller would then ask company managers to start ordering workers to do strange things, like impromptu cavity searches or jumping jacks as part of a purported criminal investigation. Numerous incidents were reported around the country. The actual bad guy(s) got away and their identities remain unknown.

What happened in one rural McDonald’s in Mt. Washington, Kentucky clearly went dramatically over the top. We cannot publish all the details because your spam blockers will not let them all through but suffice it to say the young employee and those around her underwent substantial discomfiture as part of the hoax. The corporate defendant came under attack because they were alleged to have “known” of this scam by a random goof and did not take steps felt necessary to warn or train folks not to lose their minds and all sense of decency and judgment when they received such calls.

The matter went to hearing before a jury. We are confident the legal department of McDonalds was stunned when they ruled claimant was entitled to $6.1 million in compensatory and punitive damages. The Kentucky Court of Appeals just issued a ruling which exhaustively looked at all the facts and law but still affirmed. The ruling and details are on the web at:

http://www.leagle.com/unsecure/news.do?feed=yellowbrix&storyid=1000038480

The corporate office of this major U.S. food retailer made their position crystal-clear in an official statement:

We are extremely disappointed with today’s Appellate Court decision. McDonald’s is not disputing that what happened to [Plaintiff] was wrong. However, it has been our position throughout these proceedings that she was the victim of a malicious hoax perpetrated by individuals not representing McDonald’s.

The dollar amount McDonalds owes as of November 15th is $10,900,000. As we indicate above, we were reluctant to publish this sad legal note but we want our readers to understand you need to address it as part of your training programs to avoid the chance someone pulls such a prank on your organization.

Editor’s comment: One wag in our office pointed out the Appellate Court probably could have also found it compensable under the “traveling employee” doctrine because the worker was running or “traveling” at the time of injury. Like the recent “stray bullet” claim, most observers are starting to feel rulings such as this epitomize a state where there are so many ways for a claim to be compensable, there is no way to ever defend an Illinois employer.

As you may recall, we reported a claim that got national attention in the workers’ compensation press when a worker ran and jumped into a concessions machine to try to dislodge a bag of Doritos® that wouldn’t fall under its own weight. The poor guy broke his hip and had expensive surgery. The poor and recently defunct employer is now responsible for all of it when they just wanted their workers to be able to have a simple convenience.

In Circuit City Stores, Inc. v. Illinois Workers’ Compensation Commission (No. 2-08-0722, this replaces original opinion and was filed July 9, 2009), our unanimous Appellate Court, Workers’ Compensation Division ruled on rehearing by admitting they were initially wrong. They found the “Good Samaritan” doctrine, rather than “personal comfort” doctrine applied when the employee was injured while coming to the aid of co-worker seeking personal comfort.

The Court ruled the employer had “notice” of the arguably defective vending machine which was made available to employees for their use and personal comfort. Therefore, the employee’s hip fracture injury, suffered helping co-worker by trying to dislodge product from vending machine, was reasonably foreseeable.

With respect to the august members of the Court, we don’t agree even a little bit. They knocked out their earlier ruling when they noted the employee wasn’t addressing his own “personal comfort” but someone else’s. It is our opinion their expansion of the “Good Samaritan” doctrine is inappropriate and wildly overbroad. A Good Samaritan is someone who steps up to save the life of a stranger or otherwise minimizes imminent peril. It is our view this misguided quest for Doritos® should only be applied if the other worker needed the chips to stay alive.

It would have been a lot easier for both workers to simply track down someone who could have opened the machine up and provided the food or a refund. The worker who acted rashly to cut a corner in a wholly unpredictable way should not be awarded benefits in a fashion that encourages others to act without regard for safety.

If you have such machines in your workplace (and we do), we suggest putting up signs indicating employees should not strike, run at or otherwise shake the machines but contact management for assistance. We appreciate your thoughts and comments.

Editor’s comment: Business observers may ‘draw your own contusions’ but we again feel Illinois workers’ compensation claims are invariably being drawn toward global coverage of all injuries. Our heart goes out to the unfortunate claimant who, regardless of the legal analysis, suffered a life-changing injury.

In Restaurant Development Group v. Hee Suk Oh, (No. 1-08-2143WC June 16, 2009). a unanimous Appellate Court, Workers’ Compensation Division ruled claimant’s job as a bartender in the Bucktown area of Chicago exposed her to a higher risk of injury than the “general public.” The record indicated the Bucktown neighborhood was a “high crime area” with a history of gang violence. A Chicago police officer was called to testify and indicated the neighborhood was in the top 25-33% of Chicago neighborhoods for violent crimes. There also appears to be a lot of evidence presented indicating the Bucktown area was “gentrifying” or improving rapidly and the gangs were being moved out. Obviously, that process didn’t happen fast enough.

The court also noted the property had floor to ceiling glass near which claimant worked on evenings and weekends. We point out you don’t build restaurants with floor to ceiling glass in poor neighborhoods—the presence of such restaurants signaled the improving neighborhood. Regardless, the members of the court felt the presence of such glass placed claimant at an increased risk of injury from gunfire. Therefore, injuries she suffered when a stray bullet pierced the window and paralyzed her arose out of and in the course of her employment. The court affirmed a permanent total disability award as not being against the manifest weight of the evidence.

We initially note claimant lived in the Wicker Park neighborhood and worked in an area called Bucktown. For our readers from outside the Chicago area, in the 60’s and 70’s, both areas were pretty run down but had similar transformations where gangs were pushed out and nicer folks who like Starbucks® moved in during the late 1990’s and into this century. From our view of the Wicker Park and Bucktown neighborhoods, the risks of getting hit by a stray bullet were a 24/7/365 issue for this worker whether at home, work or play. But also understand it is a wildly uncommon thing for someone to be hit and seriously injured while at work in this fashion.

The question faced by the court is when something is “a risk common to the public” versus a work-related risk. We point out the adjective ‘stray’ in the term ‘stray bullet’ means random and unexpected. Employers aren’t supposed to owe workers’ compensation benefits for random and wholly unexpected events that cause injury. We assert the reasoning provided in this ruling would render all actions leading to anyone becoming a victim of any crime at work compensable. We also point out Chicago doesn’t have a neighborhood that doesn’t have violent crime and gang issues, some have more and others have less. President Obama’s neighborhood is closely watched for violent crime and gang issues—they won’t let you or I travel within six blocks of his home due to appropriate concerns for his safety. We are in Chicago that has violent crime and, sadly, stray bullets—that is why many of our readers don’t live there. With deference to the court, they clearly don’t compare apples to apples—they say they are comparing the risk of being in Chicago to the risk of being in rural Illinois. We agree there are not a lot of stray bullets in the cornfields outside Bloomington, Mendota or Marengo. In contrast, we assert the risk of stray bullets is a “risk common to the public” that lives, works and plays in this city, like this claimant.

We had a claim where a woman’s purse was snatched near her job in front of twelve co-workers. As the unlucky victim, she claimed injury. While we are sorry to hear it, there are purse-snatchings in that area. Are all such events going to be work-related? When is it a work-related risk and when is it a risk of being a human in this state? Folks in Mendota and Marengo don’t have their purses snatched so is it compensable?

Our problem with the reviewing courts in this state is they do a solid job of legal and factual analysis. As a group, they tell us why cases are compensable, in their view. As a matter of fact, on the issue of accidental injuries being compensable, we can’t remember any case coming from the reviewing courts that wasn’t eventually found to be compensable. In this ruling, they don’t give anyone any guidance on when a victim of any crime who is at work in a shady or run-down area of cities like Chicago, Rockford or Aurora won’t get benefits. We want our readers to understand we can’t have a system of litigation if our hearing officers and the reviewing courts are going to make all events uniformly compensable under the repetitive trauma concept, the traveling employee model or the “risk common to the great public that doesn’t live in a cornfield in Mendota” approach.

We appreciate your thoughts and comments.

Editor’s comment: You might want to put a “Do Not Bash” sign up by your vending machines following this ruling. In Circuit City Stores v. Illinois Workers’ Compensation Commission, (No. 2-08-0722WC May 21, 2009), the Appellate Court, Workers’ Compensation Division unanimously reversed the trial court’s denial of benefits and reinstated a significant award by the Workers’ Compensation Commission. The Commission found an injured employee suffered compensable injuries arising out of and in the course of his employment when he fell and fractured his hip helping a fellow employee dislodge a bag of chips from defective vending machine supplied by employer.

Claimant was a car-stereo installer who rammed a vending machine that refused to give up a bag of Fritos©. We note it isn’t often that retrieving a stuck snack becomes a compensable injury. As often happens when someone pays for snacks that get stuck in a vending machine, the worker first tried shaking the machine set in a hallway just outside a workplace break room. When that didn’t help he backed up and jumped and threw his shoulder into it. He fell down with a broken hip and was rushed into surgery. He got over $60,000 in medical benefits, 12+ weeks of lost time and 35% LOU of the leg.

Ramming the vending machine was legally foreseeable because products regularly jammed in it, our appellate court said. For those who argue it is a risk common to the public, we can only say “welcome to Illinois.” Allegedly employees at the store often shook the machine to dislodge snacks. So the court said butting, bashing and shaking the machine were foreseeable and the worker was acting within the scope of his employment when he did so. From the business perspective, no one pays an employee to bash, butt or jump into vending machines. Illinois employers should not have to tell their employees if a stack gets stuck; ask the manager for a refund or assistance to open the machine and don’t endanger yourself. Common sense only applies in Missouri or Indiana.

Aaaah—how are Circuit City’s Illinois locations doing these days? If you need the citation or have any thoughts send a reply.

Editor’s comment: The first thing an adjuster must do when a new claim has been made is to evaluate whether the loss is covered by workers’ compensation law (versus general liability or some other common law or statutory remedy). If so, the next inquiry is whether Illinois workers’ compensation law applies versus the law of some other state. Finally, if the case is properly an Illinois workers’ compensation claim, the adjuster must determine whether the policy in force at the time of the accident or disability covers the particular loss alleged.

A. Is this a workers’ compensation claim?

This basic question is often overlooked. The assumption is that if a workers’ compensation claim is filed, the case necessarily involves a loss that should be compensated under workers’ compensation law. However, in order to recover benefits under workers’ compensation law, the claimant must be at or close to work and “working” to obtain benefits. The traditional WC injury occurs when the employee is injured while incurring risks which they only incur at work vis a vis the risks of daily life and discourse. If it can be established that the accident or disability occurred outside the employment or as a result of a risk of everyday life (regardless of work), the claim for workers’ compensation benefits should be denied.

One exception to the general rule above is the “traveling employee” rule. Claims involving employees who are traveling on a special mission for their employers are said to be protected by workers’ compensation coverage for all activities they could reasonably be expected to partake in while on the road.

Also, it is important to understand that the employer and its carrier and TPA have in some instances an “‘option” with regard to payment of benefits under either workers’ compensation or general liability. For example, if an employer has an employee become injured as a result of slipping on ice and snow while working on company property, it is possible that you could successfully deny the claim for workers’ compensation benefits only to then face a premises liability lawsuit which is possibly much more expensive to defend and potentially explosive due to the unpredictability of jury awards. The employer can opt not to fight the workers’ compensation claim and voluntarily pay workers’ compensation benefits which would block any third party claim against the employer if the employee knowingly accepts such benefits.

B. Illinois jurisdiction

Once it has been established the claim properly involves workers’ compensation benefits, the adjuster must determine whether Illinois is the proper jurisdiction for the claim to be heard. It is critical to understand a claimant could have a claim for workers’ compensation benefits in a multitude of states or jurisdictions. The employer should receive credit for any benefits paid in any state or under federal law under the full faith and credit clause of the United States Constitution. You should never have to double or triple pay benefits. But remember, payment of Illinois benefits does not block the filing of a claim in another state or under federal law, if applicable.

Illinois has proper jurisdiction if one of the following tests are met:

1. The accident occurs in Illinois. This concept applies even if the employee executed a written agreement prior to employment to only seek benefits in another state;

2. The accident occurs outside Illinois but the “contract for hire” was formed in Illinois. This is the tactic most commonly used to bring out of state claims into Illinois. The contract for hire is said to be finalized where the employee accepts the offer of employment which leads to a number of factual disputes;

3. Employment was principally localized in Illinois. This is utilized when the employer may have an out of state headquarters for employees who really perform the majority of their work in Illinois. This situation frequently occurs in trucking claims where the petitioner establishes the principal localization of work in Illinois by logs indicating the aggregate number of miles driven in Illinois versus other states.

Other factors sometimes cited by the Commission and the courts in jurisdiction claims include the state of petitioner’s residence, the location of the principal work site and the level of business conducted by the employer in Illinois. These concepts are not contained in the Illinois statute but seem to be utilized by the courts looking for factors considered in other areas of law involving jurisdictional fights.

C. Pre-injury agreements with regard to jurisdiction

Be wary of pre-injury agreements to have an employee select or agree to the jurisdiction where benefits will be received upon suffering an injury. Some employers with multi-state operations or traveling employees will routinely require employees to execute such agreements. These documents will generally be ignored in Illinois and we do not feel that they have any real legal effect. However, we are not aware of any prohibition with regard to such agreements. It is possible that an employee will not become aware of his or her ability to make a claim for benefits in Illinois or may honor they commitment and may act consistent with the agreement with regard to jurisdiction. If workers’ compensation benefits will be paid timely in the state that they have agreed to and a dispute does not arise, this concept may be successful.

D. Multi-state settlements

Also, when any workers’ compensation claim is settled, you may attempt to block the filing of other claims by indicating that the settlement is for claims in any state. This technique is employed more for the perception of the employee and his attorney than for its legal effect. For technical reasons which do not bear repetition here, this concept probably wouldn’t be legally effective. It does leave petitioner and his counsel with the sense that closure has been reached and may cause them to refrain from filing subsequent claims in other states.

E. Insurance Policy Coverage

The adjuster must also consider whether the specific policy written for the employer covers the loss. The date of accident or disability must fall within the dates of coverage although this issue becomes clouded in repetitive trauma claims where no specific incident is identified. It is not uncommon for two or three different insurance carriers to argue that the actual manifestation of injury occurred during a different carriers’ policy. If a coverage question is precipitated by the lapse of the workers’ compensation policy prior to the accident taking place, the insurance carrier must prove that the policy was properly terminated. This requires notice to the employer/respondent as well as the Workers’ Compensation Commission. Otherwise, the Workers’ Compensation Commission will require extension of coverage through the date of accident to ensure the injured party gets benefits.

An additional consideration in policy coverage is the employment position of petitioner. If petitioner is a sole proprietor, owner or partner of a business, coverage for injuries must be elected. If there is no election for coverage, the principal may not be entitled to workers’ compensation benefits paid by the carrier. This does not mean benefits might not be sought; they would just not be covered by the insurance policy. This also would not affect any other common law rights available.

If you have thoughts or questions about jurisdiction, coverage of the Act or any other workers’ compensation or employment law issue, send a reply.