Archive for January, 2009

WC CALCULATIONS

Tuesday, January 13th, 2009

2009 Calculation Program
Version 10.0

Version 10.0 of the calculation program is now available. This includes rates for the year 2009. This is still a single user system. Please do not attempt to install in a networked environment and make accessible by more than one user, as both calculation and program errors will occur.  This application is also not supported in a Windows NT or Citrix environment. Click here  Calculation Program Help Manual to view the help manual which includes instructions on installing this program. It may be helpful to print these instructions before continuing. If you have a previous version of this program on your PC, it must be uninstalled first. Once you have printed and read the install instructions, click here setup.exe to download the new version to your computer. You MUST save this file to your hard drive and install it from there. The file size is almost 13MB, so it may take a few minutes depending upon the speed of your connection.  If you wish to install this program on more than one computer, you can save the setup.exe file to any external media (i.e., flash drive, CD, etc.).If you do not have internet access, you may obtain this program on CD-ROM. If you would like a copy, please send a letter to Sandra Adams at the Workers’ Compensation Agency, P.O. Box 30016, Lansing, Michigan 48909 . The letter must be accompanied by a padded, stamped ($1.65 worth of postage), self-addressed mailer at least 7″ x 9″ in size.

CASE OF THE MONTH (JANUARY)

Thursday, January 1st, 2009

Brown v Cassens Transport Co., 6th Circuit Court of Appeals (Docket No. 05-2089, Opinion issued and recommended for publication on October 23, 2008)
In this important case relating to workers’ compensation in Michigan, the Plaintiffs were current or former employees of Cassens Transport, Inc. who submitted worker’s compensation claims to Cassens based on workplace injuries they had alleged to have each sustained. On June 22, 2004, the plaintiffs filed a complaint raising Racketeer Influenced and Corrupt Organization (RICO) claims and Intentional Infliction of Emotional Distress (IIED) claims against the defendants. In their complaint, the plaintiffs alleged that Cassens, which was self-insured for purposes of paying benefits under the Worker’s Disability Compensation Act (WDCA), contracted with Crawford & Company to serve as a claims adjuster for the worker’s compensation claims of Cassens’s employees. They further pleaded that Cassens, Crawford, and Dr. Saul Margules, as well as other “cut-off” doctors, engaged in a pattern of racketeering activity that denied the plaintiffs’ worker’s compensation claims. Specifically, the plaintiffs alleged that Cassens and Crawford deliberately selected and paid unqualified doctors, including Dr. 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. The plaintiffs claimed that the defendants made fraudulent communications amongst themselves and to the plaintiffs by mail and wire in violation of 18 U.S.C. §§ 1341, 1343, which serve as the predicate acts for their RICO claims.  Id.

The district court granted the defendants’ motion to dismiss pursuant to Rule 12(b)(6) on July 15, 2005. The plaintiffs filed a timely appeal. A majority of the 6th Circuit panel affirmed the dismissal on the ground that plaintiffs failed to plead that they relied on misrepresentations by defendants. The U.S. Supreme Court, however, granted plaintiffs’ petition for a writ of certiorari, vacated the 6th Circuit’s judgment, and remanded the case to us for reconsideration in light of the decision in Bridge v Phoenix Bond & Indemnity Co., 128 S. Ct. 2131 (2008), which held unanimously that a civil-RICO plaintiff does not need to show that it detrimentally relied on the defendant’s alleged misrepresentations.
On remand, the 6th Circuit held:

(1)    Thirteen predicate acts with the same purpose (to reduce Cassens’s payment obligations towards worker’s compensation benefits by fraudulently denying worker’s compensation benefits to which the employees are lawfully entitled) constituted a pattern of racketeering activity for a RICO claim, regardless of whether injury to each worker independently consisted of a pattern of racketeering activity;

(2)    Relationship-plus-continuity standard for establishing pattern of racketeering activity was satisfied by allegations as each of the plaintiffs has also sufficiently pleaded that they were injured by the defendants’ “pattern of racketeering activity” under 18 U.S.C. §§ 1964(c) because the defendants’ fraud deprived the plaintiffs of worker’s compensation benefits and caused them to incur attorney fees and medical care expenses;

(3)    The injured workers were not required to plead or prove reliance on misrepresentations;

(4)    The worker’s allegations were sufficient to satisfy proximate causation requirement for civil RICO claim because the defendants’ fraudulent acts were a “substantial and foreseeable cause” of the injuries alleged by the plaintiffs: the deprivation of their worker’s compensation benefits and expenses for attorney fees and medical care;

(5)    The Michigan worker’s compensation statutes did not reverse preempt RICO under McCarran-Ferguson Act because RICO would not “invalidate, impair, or supersede” the WDCA or frustrate the goal of the state law to punish the improper denial of benefits if it was part of racketeering activity, and because worker’s compensation benefits are not a form of insurance; however

(6)    The denial of workers’ compensation benefits by the defendants was not sufficiently outrageous to support claim for intentional infliction of emotional distress.  Id.

In light of these holdings, the 6th Circuit Court of Appeals reversed the dismissal of plaintiffs’ RICO claims and remanded the case back to the district court for further proceedings consistent with the panel’s opinion. However, the Court affirmed the dismissal of the plaintiffs’ IIED claims.