BRB: ALJs are Not Required to Use K.S. to Calculate Average Weekly Wage

The Benefits Review Board (“BRB”) recently discussed average weekly wage calculations in an unpublished Defense Base Act decision.  In Hamidzada v. Mission Essential Personnel, the Employer and Carrier appealed an administrative law judge’s (“ALJ”) average weekly wage decision.  The ALJ calculated Claimant’s average weekly wage using only the wages Claimant earned overseas during his employment for Employer in Afghanistan.  Employer appealed, arguing that the ALJ erred in relying on the BRB’s K.S. decision–which used to be the seminal average weekly wage decision for DBA claims–because a federal court vacated K.S.

Why was K.S. so important?  For years, K.S. was used in connection with Proffitt v. Serv. Employers Int’l to more or less bar ALJs from blending together overseas and stateside earnings to determine an injured worker’s average weekly wage.  Instead, K.S. wanted average weekly wage calculations to be based on only overseas wages when the employee was paid “higher wages for more dangerous work under at least a one-year contract….”  After K.S. was appealed to the Southern District of Texas, the federal court vacated the decision in Service Employees Int’l, Inc.  The court reasoned that ALJs are not mere calculators required to blindly apply prior BRB precedent–precedent with no statutory, regulatory, or common-law support–to determine an injured worker’s AWW.

In the present case (Hamidzada), the Employer raised a legitimate issue with the ALJ’s average weekly wage calculation.  The BRB (in a footnote) conceded that it was “without any published precedent on the [average weekly wage] issue,” and it chose to vacate the ALJ’s calculation of Claimant’s average weekly wage.  As stated by the BRB (with internal citations omitted):

We agree with employer that the administrative law judge believed that he was compelled to apply [K.S.], based on his statements about “controlling” law and that claimant’s average weekly wage “must be based on what [Claimant] earned in Afghanistan” given his findings of fact.  Given the district court’s order vacating [K.S.], we vacate the administrative law judge’s average weekly wage finding, and we remand this case for findings of fact under Section 10(c).  In its decision, the district court based its holding on the administrative law judge’s “wide discretion,” specifically noting, “[I]t is within the administrative law judge’s discretion to determine whether or not the facts of the two cases [K.S. and Proffitt] are similar enough to merit similar outcomes.”  On remand, the administrative law judge must determine the facts pertinent to the average weekly wage calculation, apply relevant case precedent, and calculate an average weekly wage that represents claimant’s wage-earning capacity at the time of injury.

Hamidzada v. Mission Essential Personnel, BRB No. 13-0312 (Mar. 21, 2014).

BRB Questions Whether Work or Adultery and Drugs Led to Suicide

Decedent worked as a pest control specialist in Iraq for one and a half years.  Upon returning to the United States in June 2006, he learned that his wife had committed adultery while he was away, and that his daughter developed a drug problem.  A few weeks later, Decedent checked himself into a hotel room where he shot and killed himself.  Claimant, Decedent’s widow, filed a claim for death benefits contending that Decedent’s suicide was related to his employment.

An administrative law judge (“ALJ”) agreed, noting that “the zone of special danger could have been a cause of [Decedent's] suicide.”  The ALJ noted Decedent’s exposure to mortars, a hazardous waste spill, a colleague’s injury or death, and even the Decedent’s physical  separation from his family as all falling under the zone of special danger.  After the ALJ awarded benefits, the Employer and Carrier appealed to the Benefits Review Board (“BRB”) the first time.  The BRB vacated and remanded for the ALJ to determine whether Employer presented substantial evidence to rebut the Section 20(a) presumption.

On remand, the ALJ awarded compensation even though he determined that Employer rebutted the Section 20(a) presumption.  The ALJ then weighed the evidence as a whole and assigned more weight to Claimant’s expert psychologist.  According to the ALJ, the Decedent’s suicide was the result of an irresistible impulse and not an intentional act.  Employer again appealed.

After the ALJ issued his Decision, but before the BRB issued its second Decision, the Ninth Circuit issued its opinion in Kealoha v. Dir., OWCP, 713 F.3d 521 (9th Cir. 2013).  The Navigable Waters post on Kealoha is available through this link.  In Kealoha, the Ninth Circuit held:

[S]uicide or injuries from a suicide attempt are compensable under the Longshore Act when there is a direct and unbroken chain of causation between a compensable work-related injury and the suicide attempt.  The claimant need not demonstrate that the suicide or attempt stemmed from an irresistible suicidal impulse.  The chain of causation rule accords with our modern understanding of psychiatry.  It also better reflects the Longshore Act’s focus on causation, rather than fault.

What is an “unbroken chain of causation?”  It is “where the injury and its consequences directly result in the workman’s loss of normal judgment and domination by a disturbance of the mind, causing the suicide.”

The BRB determined that Kealoha applied to this case even though the Ninth Circuit decided Kealoha after the ALJ issued his second Decision.  Ninth Circuit jurisdiction applied, and the BRB was bound to apply Ninth Circuit law.  Considering such, the BRB had to vacate and remand the claim for the ALJ to determine whether there was an “unbroken chain of causation from the injury to the suicide.”  The ALJ must consider the full extent of the events that occurred prior to Decedent’s death, which Employer summarized as follows:

Employer asserts that the events which occurred in June and July 2006 while decedent was not in Iraq were the cause of his death.  When decedent arrived home unexpectedly in June 2006, he learned: he had been locked out of his home; his wife appeared to be committing adultery; his daughter was seeing someone 10 years older than she; and, she was taking drugs and had been expelled from school for doing so.  Thus . . . while there may have been previous family strife and decedent may have been troubled by being separated from his family,  the true stressor that caused him to actually commit suicide was his familial  situation once he arrived home.

It is telling that the BRB chose to paraphrase Employer’s arguments.  But if that wasn’t enough, it also printed an edict for the ALJ in footnote 14:

Effectively, the administrative law judge found that the behavior of claimant and her daughter was the natural and unavoidable result of decedent’s having been away from home, the fighting and breakup were the natural next result, and the suicide was the natural final result.  The administrative law judge should readdress this line of reasoning under the “chain of causation” test enunciated by the Ninth Circuit.

Dill v. Serv. Employees Int’l, Inc., BRB No. 13-0262 (Mar. 11, 2014).

Tip of the hat to Lara Merrigan for forwarding this opinion.

Plaintiff’s Assault Lawsuit Dismissed Because the DBA Was His Exclusive Remedy

Plaintiff filed a lawsuit in the Eastern District of Virginia alleging that his supervisor assaulted him while they were both working for a Defense Contractor at Camp Speicher in Iraq.  Plaintiff attempted to hold his employer liable for intentional infliction of emotional distress and for failing to provide timely medical care after the assault.  The district court dismissed Plaintiff’s claims for lack of subject matter jurisdiction, determining that Plaintiff’s remedy was found in the Defense Base Act “DBA,” and not in a tort suit.  As stated by the court (with internal citations omitted):

The assault at issue in this case occurred while Mason was working at Camp Speicher, a U.S. military base that was captured during the Iraq war. Thus, the DBA applies and provides Mason’s exclusive remedy against Sallyport as long as the assault at issue falls within the DBA’s definition of “injury.” Mason contends that it does not, because Edge intentionally injured him and Edge’s actions, under the facts alleged, are not those of a “third party,” but rather are imputed to Sallyport, both because Edge was Mason’s supervisor at the time of the attack and because Sallyport was on notice of Edge’s disposition for violence when it hired him. Under this reading of the complaint, Mason claims his injuries as a result of Edge’s assault fall within the exception that applies when an employer acts with specific intent to injure its employee.

The Court finds this argument unpersuasive. The exception Mason cites applies only where the employer itself specifically intends the injury; it is not sufficient that an employee, even one in a supervisory role, acts with specific intent to injure.  While Mason alleges that Sallyport was negligent in hiring Edge, he does not allege that Sallyport in any way directed the assault or intended for it to take place. Mason does allege that Sallyport intentionally inflicted emotional distress on him after the attack, but even accepting that such a claim can fall within the exception to the DBA, Mason has failed to allege facts that would make that claim plausible.  The disfavored tort of intentional infliction of emotional distress requires conduct, resulting in severe emotional distress, that is “so outrageous in character, and so extreme in degree, as to go beyond all bounds of decency, and to be regarded as atrocious, and utterly intolerable in a civilized community.”  Here, there are no facts that would make plausible any characterization of Sallyport’s conduct as meeting that high standard.

For the above reasons, the Court finds and concludes that the DBA provides Mason’s exclusive remedy against Sallyport and that this Court is therefore without jurisdiction to consider Mason’s claims against Sallyport.

Mason v. Sallyport Global Holdings, Inc., No. 1:13-cv-1134, 2013 WL 6504625, — F.Supp.2d —- (E.D. Va. Dec. 9, 2013).

Advanced Consulting’s Defense Base Act Conference Was a Rousing Success

Each January, Advanced Consulting hosts the only national Defense Base Act (“DBA”) seminar focusing on the defense of DBA claims.  Last week, I attended (and spoke at) the seminar, and had a great time doing so.  Some highlights of the conference included:

Dr. Michael Hilton’s discussion of psychiatric issues in DBA claims.  Dr. Hilton is a board certified forensic psychiatrist.  In his private practice, Dr. Hilton “treats a wide range of adult psychiatric conditions, including affective disorders, psychotic illnesses, anxiety conditions, stress reactions, alcohol and substance abuse disorders, chronic pain conditions and work injury related psychological problems.”  The good folks at Advanced Consulting were nice enough to post Dr. Hilton’s PowerPoint presentation to their website.  Take a look.  Dr. Hilton discussed the differences between the DSM-IV and DSM-V with respect to PTSD cases, and particularly how the DSM-V diagnostic criteria are more permissive than past versions of the DSM.

Jeff Knipper’s discussion of Medicare Set Asides from the Longshore perspective.  MSAs are not fun.  Not for claimants; and not for employers and carriers.  Often, MSAs can throw a monkey wrench in settlement plans.  But, in some cases, MSAs are necessary to protect the interests of the Centers for Medicare and Medicaid Services.  As explained on Mr. Knipper’s PowerPoint presentation, the parties to a DBA claim should take steps to keep MSA costs reasonable.  If the MSA is reasonable, the parties are in a better position to reach an amicable settlement.

Alan Brackett’s discussion of Vocational Barriers Under the Defense Base Act.  MBLB’s own Alan Brackett, who also happens to be this month’s featured attorney in Attorney at Law magazine, discussed vocational issues faced by DBA employers and carriers.  Mr. Brackett’s PowerPoint presentation, prepared by Mr. Brackett and MBLB’s newest attorney, Cassie Preston, addressed everything from the geographical boundaries of the relevant labor market to specific problems posed by foreign nationals.  He even highlighted many of the important case law developments over the past year.

Shaun Aulita’s and Andrew Blauert’s discussion of diligent job searches, the vocational rehabilitation process, and credible independent medical examination reports.  An injured worker who is capable or working must diligently seek employment.  That’s part of the burden shifting framework.  If a claimant cannot return to their usual employment, an employer must show the availability of suitable alternative employment.  Then, the claimant must establish that they diligently sought work.  Ms. Aulita’s PowerPoint presentation addressed cases where diligence was lacking, as well as the need for a job applicant to be proactive in today’s labor market.  Mr. Blauert’s PowerPoint presentation discussed another key component for defense claims: the independent medical examination.  What are some of the factors that employers and carriers should consider with IME reports?  Take a look at Mr. Blauert’s presentation to find out.

Jonathan Tweedy’s discussion of Section 8(i) Settlements.  To settle a Longshore or DBA claim, litigants must satisfy the process contained in Section 8(i) of the Longshore and Harbor Workers’ Compensation Act.  The Department of Labor’s step-by-step approach for settlements can be found at 20 C.F.R. § 702.242.  Make no mistake, all parties to the settlement must assure satisfaction of the statutory and regulatory requirements.  Mr. Tweedy’s PowerPoint presentation discussed the who, what, when, why, and how for DBA settlements.

Mark Eckels’ discussion of Pre-Trial Orders, and his discussion of burn pits.  When an administrative law judge (“ALJ”) issues a Pre-Trial Order, the ALJ tells the litigants how the case must proceed.  The Order contains dates that must be met in order to keep the case progressing smoothly.  One of the most instructive comments I have ever heard an ALJ make to a non-compliant litigant was that the dates in the Pre-Trial Order were not aspirational goals…they  were requirements.  Mr. Eckels’ PowerPoint presentation addressed this same concept: that the Pre-Trial Order is an Order, not a goal.  Then, the second half of Mr. Eckels’ presentation addressed Burn Pit Litigation.  Mr. Eckels posited that burn pits are the future of DBA litigation, but the future is not yet now because the “[h]arm from military burn pits [is] inconclusive.”

Keith Flicker’s Discussion about changes to the DBA and the advent of the OCCA.  The Overseas Contractors Compensation Act (“OCCA”) is exactly what no one wants: a government program where injured contracts are paid directly by a fund maintained by the DOL.  In other words, OCCA is akin to the Federal Employees Compensation Act (“FECA”).  If I were a DBA claimant, I would not want to trade my DBA benefits for FECA benefits.

All in all, Advanced Consulting’s conference was a rousing success.  The conference has grown considerably in the last four years.  Attendees included employers, carriers, third party administrators, physicians, and defense lawyers.  Without a doubt, I will attend next year’s conference.