State News

By: Jigar S. Desai:

n Singleton v. Illinois Workers’ Compensation Commission, 2025 IL App (1st) 240120WC-U, the First District Appellate Court affirmed the dismissal of a workers’ compensation appeal for want of jurisdiction, emphasizing the strict, jurisdictional nature of statutory deadlines for filing a circuit court review of a Commission decision.

Rashun Singleton filed two applications for adjustment of a claim in 2016 and 2018, alleging a work-related injury from Singleton’s employment with Amita Health/Advent Health. The cases were consolidated. In July 2019, both claims were dismissed for want of prosecution. Singleton filed multiple motions to reinstate, all of which were denied by the arbitrator. The Commission affirmed the arbitrator’s denial on January 31, 2023. 2025 IL App (1st) 240120WC-U at ¶¶5 – 6.

That same day, the Illinois Workers’ Compensation Commission sent notice of its decision to both parties via its CompFile system. Singleton, representing herself, did not file a petition for judicial review in the circuit court until March 1, 2023 — well outside the 20-day statutory deadline.

Amita moved to dismiss the appeal for lack of subject-matter jurisdiction under §2-619(a)(1) of the Illinois Code of Civil Procedure, 735 ILCS 5/2-619(a)(1). The circuit court agreed and dismissed the petition. Singleton’s subsequent motions to vacate and reconsider were denied.

The issues before the appellate court included the following:

1. whether the 20-day period to seek judicial review under §19(f)(1) of the Workers’ Compensation Act, 820 ILCS 305/1, et seq., began on January 31, 2023, when electronic notice was sent via CompFile;

2. whether the method of notice (email) complied with the statutory requirement for notice; and

3. whether Singleton’s late filing could be excused on equitable grounds.

The appellate court affirmed the circuit court’s dismissal for lack of jurisdiction. The court held:

1. The 20-day filing deadline began when notice was sent via CompFile. Under §19(f)(1) of the Illinois Code of Civil Procedure, judicial review must be initiated within 20 days of receiving notice of the Commission’s decision — not the decision itself. Here, notice was deemed received on January 31, 2023, when the CompFile system generated and sent emails to the parties. The court took judicial notice of these public records.
   
   
2. Electronic notice is valid when the party subscribes to CompFile. The court rejected Singleton’s argument that §19(i) of the Workers’ Compensation Act required personal or mailed notice. By registering with CompFile and consenting to electronic service, Singleton agreed to receive notice via email. Under 50 Ill.Admin. Code §9015.50(c), such service is deemed complete upon transmission.
   
   
3. Late filing is jurisdictional and cannot be excused. The court reaffirmed that the statutory filing period is jurisdictional. Absent strict compliance, the circuit court lacks subject-matter jurisdiction. Singleton’s argument that the email may have gone to Singleton’s spam folder was irrelevant under existing caselaw. 2025 IL App (1st) 240120WC-U at ¶17.

The Singleton decision is a reminder that while the Illinois Workers’ Compensation Commission may exercise discretion in certain procedural matters, the statutory deadlines for initiating judicial review in circuit court are strictly jurisdictional. The appellate court reinforced the following:

1. Receipt of electronic notice via CompFile satisfies the statutory requirement for notice if the party has registered for the system.

2. The statutory 20-day window to seek circuit court review under 820 ILCS 305/19(f)(1) begins on the date notice was issued, not on the date of receipt of the decision itself or a party’s actual knowledge.

3. Jurisdiction cannot be conferred by equitable arguments, such as misunderstanding or inadvertent delay.

Comparison to Ryba: Different Rules at Different Levels

In May’s FLASHPOINTS, we analyzed the appellate court’s decision in Ryba v. Illinois Workers’ Compensation Commission, 2025 IL App (2d) 230596WC-U. In Ryba, the appellate court affirmed the Commission’s reinstatement of a claim when the motion to reinstate was filed well after the 60-day period provision of the Workers’ Compensation Act.

The Ryba and Singleton decisions present a clear contrast in how timing issues are treated, depending on whether the matter remains before the Commission or has moved into the judicial review phase.

In Ryba, the appellate court allowed reinstatement of a claim long after the 60-day reinstatement period had passed. The court emphasized that when factual disputes exist — such as denial of notice — the Commission retains discretion to resolve those facts and, when appropriate, toll deadlines. The decision acknowledged the Commission’s broader procedural discretion, particularly during unusual periods like the COVID-19 pandemic.

By contrast, Singleton confirms that once a case moves into the judicial review phase, the jurisdictional lines are strictly drawn. The 20-day filing period under §19(f)(1) of the Workers’ Compensation Act is not a discretionary deadline — it is a jurisdictional bar. Unlike in Ryba, factual disputes such as whether an email went to a spam folder are irrelevant if notice was properly issued and the statutory clock began.

The key distinction lies in statutory discretion vs. jurisdictional mandates:

1. The Commission has discretion to determine factual disputes regarding notice and may permit reinstatement based on equitable considerations (Ryba).

2. The circuit court’s jurisdiction under §19(f)(1) is strictly limited by statute, and equitable considerations cannot extend the deadline (Singleton).

Practitioners must understand the procedural posture of a workers’ compensation case and the implications it has on applicable deadlines. Before the Commission, factual disputes over notice and good cause may allow some leeway. But once a decision is final and the case moves into judicial review, strict compliance with statutory deadlines is essential. Electronic notice is deemed sufficient, and failure to act within 20 days will likely prove fatal to the appeal, as it did in Singleton.

By: Kisa P. Sthankiya

The Illinois Supreme Court issued in Bitner v. City of Pekin 2025 IL 131039  on September 18, 2025 finding that the Illinois Public Employee Disability Act (PEDA), does not prohibit a city from withholding employment taxes from PEDA benefits.

The plaintiffs in the case were both police officers working for the City of Pekin and injured in the line of duty in separate accidents. Both employees received PEDA benefits pursuant to Section 1(b) of PEDA.  Section 1(b) provides:

Whenever an eligible employee suffers any injury in the line of duty which causes him to be unable to perform his duties, he shall continue to be paid by the employing public entity on the same basis as he was paid before the injury, with no deduction from his sick leave credits, compensatory time for overtime accumulations or vacation, or service credits in a public employee pension fund during the time he is unable to perform his duties due to the result of the injury, but not longer than one year in relation to the same injury. (5 ILCS 345/1(b) (West 2018)

During the time that the plaintiffs received PEDA benefits, the City continued to pay the plaintiffs in the same manner as they were paid prior to their injury and withheld employment taxes (Federal, State, Social Security and Medicare).  The plaintiffs filed a suit in circuit court of Tazewell County alleging that by withholding the employment taxes, the City violated the Illinois Wage Payment and Collection Act (Wage Act) (820 ILCS 115/1 et seq. (West 2018).

Cross Motions for Summary Judgment were filed. The circuit court ruled in favor the plaintiff and entered a judgment to recoup the withheld taxes from the City. The ruling was appealed to the appellate court. The appellate court determined that based on the plain language of Section 1(b) did not prohibit the City from withholding unemployment taxes. They did not reach a conclusion on whether the only remedy was to seek a refund of the improperly withheld taxes from the IRS. The appellate court reversed and remanded the case.

The Supreme Court allowed leave to appeal. There were multiple issues decided at the circuit court and appellate level. However, the only issue before the Illinois Supreme Court in the case was whether the Appellate Court erred in its interpretation of Section 1(b).

Relying on language from prior appellate decisions, including Gibbs v. Madison County Sheriff’s Department, 326 Ill. App. 3d 473 (2001), the plaintiffs argued that section 1(b) provides for the “continuation of full pay” and that “full pay” should be interpreted to mean gross pay without employment tax deductions. The Court noted, however, that the phrase “full pay” appears nowhere in Section 1(b). The proper starting point for statutory interpretation, it emphasized, is the plain language of the statute itself. Section 1(b) expressly provides that an eligible employee, “shall continue to be paid by the employing public entity on the same basis as he was paid before the injury, with no deduction from his sick leave credits, compensatory time for overtime accumulations or vacation.” 5 ILCS 345/1(b).

The Court concluded that the phrase “on the same basis” was unambiguous and required disability payments be processed in the same manner as the employee’s pre-injury wages. Thus, if the employer routinely withheld employment taxes before the injury, those same deductions must continue post-injury in order to comply with section 1(b).

The statutory language in section 1(b) also lists specific items that cannot be deducted—sick leave, compensatory time, and vacation credits—but does not mention  employment taxes. Applying the interpretive maxim expressio unius est exclusio alterius, the Court held that the legislature’s express inclusion of certain prohibited deductions impliedly excludes others. Accordingly, the omission of employment tax withholding from the list indicates that such withholdings are permissible.

Plaintiffs argued that this reading produced an absurd or unjust result because, in their view, PEDA benefits are exempt from federal income tax, and therefore the withholding of employment taxes unlawfully reduces the benefit. The Court was unpersuaded by their argument. It observed that plaintiffs had provided no authority—no IRS ruling, federal statute, or regulation—establishing that section 1(b) payments are tax-exempt. Even if such payments were ultimately non-taxable, the Court reasoned, any excess withholding would not deprive the employee of funds owed under the Act. Rather, the proper remedy would be for the employee to claim a tax refund from the IRS or adjust his W-4 withholding status.

Additionally, the Court underscored the administrative practicality of its interpretation. They noted that public employers often face operational challenges in administering pay for police officers and firefighters who move in and out of PEDA status, sometimes for short periods. Requiring employers to continually assess taxability and alter withholding practices would create unnecessary complexity and potential compliance issues. Section 1(b), by directing that pay continue “on the same basis” as before the injury, actually simplifies administration and ensures uniformity. The Court noted that other jurisdictions, such as Massachusetts and North Carolina, have adopted similar frameworks requiring payment of “in the same manner” as regular compensation for disability payments.

The Court held that nothing in section 1(b) prohibits public employers from withholding employment taxes from disability payments. The employer, therefore, did not violate the statute by continuing to process payroll in the same manner as pre-injury compensation. The appellate court’s judgment reversing the circuit court was affirmed.

This decision reinforces that PEDA does not create an enhanced or tax-exempt benefit beyond continuation of ordinary salary. Payments should be issued from the regular payroll system and subject to the same withholdings as the employee’s pre-injury compensation.

The decision also reiterates that questions regarding whether disability payments are taxable, or whether withholdings were appropriate, are matters between the employee and the Internal Revenue Service. Per the decision, ff an employee believes the payments are exempt from taxation, the appropriate recourse is to adjust tax withholding by submitting a new W-4 form or to seek a refund directly from the IRS. This clarification protects municipalities from unwarranted demands for reimbursement and reinforces that PEDA’s purpose is to ensure income continuity, not to provide a tax-exempt benefit.

By: Kisa P. Sthankiya

n Card Dynamix, LLC v. Illinois Workers’ Compensation Commission, 2024 IL App (3d) 240319WC-U, the Workers’ Compensation Commission Division of the Illinois Appellate Court addressed a significant question concerning the scope and applicability of §12 of the Workers’ Compensation Act, 820 ILCS 305/1, et seq., in the context of post-award proceedings. Specifically, the court was asked to determine whether an employer retains the statutory right to compel an independent medical examination (IME) after an award granting the claimant ongoing prospective medical rights has been entered, particularly when the claimant seeks additional medical expenses that may not fall squarely within the original award.

The claimant, a 56-year-old quality sample inspector for a plastic manufacturing company, suffered a significant lower back injury in 2013 while pushing a heavily loaded cart. MRI imaging revealed a lumbar disc bulge, and subsequent treatment included a laminectomy and spinal fusion at L5-S1. The treating orthopedic surgeon, Dr. Mark Sokolowski, oversaw the claimaint’s care over several years, prescribing pain medications and recommending follow-up MRIs.

After conservative treatments proved ineffective, the claimant underwent surgery and continued to require ongoing care and prescriptions. In 2017, an arbitrator awarded her 35 percent permanent partial disability under §8(d)(2) of the Act, ordered the employer to cover prospective medical care under §8(a), and left medical rights “open.” 2024 IL App (3d) 240319WC-U at ¶3.

After the arbitration award, the claimant returned to Dr. Sokolowski for at least eight follow-up visits between December 2017 and February 2021, during which he continued prescribing pain medication, including hydrocodone. On August 10, 2018, due to the claimant’s persistent lumbar pain and radiculopathy, Dr. Sokolowski referred her to Dr. Kalina, a pain management specialist, for long-term pain management. The claimant began treatment with Dr. Kalina on August 20, 2018, and continued through at least June 2021. Dr. Kalina’s care included addressing conditions such as neck pain and the aftermath of a stroke — ailments not clearly addressed by the original award or directly linked to the claimant’s work injury. All related medical bills were submitted to Travelers Insurance Company.

Travelers initiated a utilization review to assess whether the pain management medications prescribed by Dr. Sokolowski after the arbitration were appropriate and consistent with evidence-based standards. However, Travelers failed to provide the reviewing doctors with complete information, including the arbitration award granting the claimant prospective medical care. As a result, some reviewers denied medications that Dr. Sokolowski had already prescribed and that the arbitrator had approved. Despite Dr. Sokolowski’s repeated requests for a peer-to-peer review, a right guaranteed under the Act, neither Travelers nor the reviewing physician responded. Additionally, Travelers failed to pay for a prescribed drug even after approval by its own reviewing physician. Drs. Sokolowski and Kalina also documented the claimant’s ongoing need for a new MRI of her lumbar fusion site, which Travelers did not authorize. The MRI was eventually performed over four years after it was first recommended, paid for by the claimant’s group insurance carrier in January 2021.

The employer’s insurer, Travelers, declined to pay for these treatments without first conducting an IME to determine causation and medical necessity. The claimant refused to submit to the IME, contending that §12 does not authorize an employer to demand an IME in a post-award enforcement proceeding.

The claimant filed a petition under §8(a) to compel payment of medical expenses and sought penalties and attorneys’ fees under §§19(k) and 16, respectively. The Commission partially granted the petition, ordering Travelers to pay for follow-ups and prescriptions by Dr. Sokolowski, as well as the MRI. The Commission focused on other language in the arbitrator’s decision, stating that the employer was liable for prospective medical treatment and expenses, “specifically, continuing follow-up visits with Dr. Sokolowski, a new lumbar MRI (but only if Dr. Sokolowski continues to order one) and continuing prescription medication, as required.” [Emphasis added by the court.] 2024 IL App (3d) 240319WC-U at ¶30. The Commission found that this statement limited the prospective medical care award to those particular treatments.

However, the Commission narrowly construed the scope of the original arbitrator’s award, concluding that it did not encompass Dr. Kalina’s treatments and found that Travelers had a right to conduct another IME under §12. Penalties and fees were awarded.

A partial dissent by Commissioner Doerries disagreed with the majority’s penalty calculation, arguing it should be based on the fee schedule, not the billed amounts.

The matter was appealed to the Will County Circuit Court, which reversed the Commission in part, finding that Travelers had no valid basis for denying treatment and expressing frustration over systemic barriers faced by claimants seeking enforcement of open medical rights. The court remanded for a recalculation of penalties and fees based on the full amount of unpaid medical bills.

On remand, the Commission complied with the circuit court’s order and issued a new decision. The employer’s subsequent appeal to the circuit court was rejected, and the Commission’s award was affirmed.

The appellate court rejected the claimant’s argument that the employer was not entitled to an IME post-arbitration award. Applying a de novo standard of review, it emphasized that the plain language of the §12 permits an employer to request an IME at “any time” to determine both “the nature, extent and probable duration of the injury” and “the amount of compensation which may be due the employee from time to time.” 2024 IL App (3d) 240319WC-U at ¶¶41 – 42. The court reasoned that the phrase “from time to time” reflects the legislature’s intent to extend the applicability of §12 beyond the initial adjudication of benefits, thereby encompassing ongoing disputes concerning medical treatment sought pursuant to an open medical award. 2024 IL App (3d) 240319WC-U at ¶42.

The court further noted that prospective medical expenses awarded under §8(a) may properly be viewed as a form of “compensation” within the meaning of §12 when they pertain to the treatment of disabling conditions causally connected to the work-related injury. Accordingly, the court concluded that Travelers was entitled to request an IME in this post-award context to evaluate whether the care provided by Dr. Kalina was necessary to cure or relieve the effects of the compensable injury and whether such care was within the scope of the prior award.

In reaching this conclusion, the court distinguished precedent that limited post-award IME rights to scenarios involving a potential change in disability status. It observed that while cases such as King v. Industrial Commission, 189 Ill.2d 167, 724 N.E.2d 896, 244 Ill.Dec. 8 (2000), addressed such circumstances, they nevertheless affirmed the broader proposition that the right to an IME does not terminate upon entry of a final award. The court thus rejected the claimant’s argument that §12 is inapplicable to proceedings aimed at enforcing prospective medical rights.

The claimant also contended that Travelers forfeited its right to an IME by failing to comply with §12’s procedural prerequisites, including reimbursing travel expenses and lost wages. The appellate court declined to reach the merits of this contention, finding that the claimant had forfeited the argument by failing to raise it before the Commission. In any event, the court deemed the argument unpersuasive, noting that even assuming Travelers had initially failed to meet its statutory obligations, such failure would not irrevocably bar it from obtaining an IME at a later time upon full compliance.

Turning to the issue of penalties under §19(k), the court held that Travelers’ refusal to pay for the disputed treatment rendered by Dr. Kalina was not unreasonable or vexatious. Given that some of the treatment involved conditions not clearly within the scope of the arbitration award or demonstrably related to the original injury, the insurer had a good-faith basis for withholding payment pending the IME.

However, the court agreed with the Commission that Travelers’ failure to pay for certain undisputed medical expenses — specifically, follow-up visits with Dr. Sokolowski, the treating orthopedic surgeon; a lumbar MRI; and continued prescriptions — was unreasonable and without justification. These services were plainly included within the scope of the arbitration award. As a result, the court affirmed the imposition of penalties and attorneys’ fees pursuant to §19(k) with respect to those expenses.

Finally, the court addressed the methodology for calculating penalties. While the Commission initially calculated penalties based on the full amount of the medical providers’ charges, the court held that the statutory fee schedule established under §8.2 governs the appropriate penalty base. The court found that Travelers preserved its right to have the penalties calculated using the fee schedule by introducing the relevant evidence into the record, and that it was not required to affirmatively request such calculation during the administrative proceedings.

The court reversed the circuit court and remanded the case to the Commission with instructions to assess penalties against Travelers based on the fee schedule outlined in §8.2 of the Act. Additionally, the Commission was directed to determine whether to award the claimant’s attorneys’ fees and costs against Travelers, as permitted by §16 of the Act. The court reinstated the Commission’s initial decision in all other respects, including its finding that Travelers was entitled to an IME and its penalty award limited to Travelers’ refusal to pay only for Dr. Sokolowski’s treatments, the prescribed medications, and the lumbar MRI.

By: Kisa P. Sthaniya

On January 24, 2025, the Illinois Supreme Court issued its long-awaited decision in Martin v. Goodrich Corp., 2025 IL 130509, upholding the constitutionality of a 2019 amendment to the Illinois Workers’ Occupational Diseases Act (OD Act), 820 ILCS 310/1, et seq. This case required the Illinois Supreme Court to construe §§1(f) and 1.1 of the OD Act in the context of a wrongful-death and survival action. The court was called on to answer three key questions:

1. whether §1(f) imposes a statute of repose, thereby falling within the civil action exception created by §1.1;
2. if so, whether §1.1 applies retroactively or prospectively; and
3. whether applying §1.1 to pre-enactment exposures would violate the Illinois Constitution’s due-process protections.

Factual and Procedural Background

The claimant, Rodney Martin, worked for BF Goodrich from 1966 to 2012. During his employment, he was exposed to vinyl chloride monomer and related chemical products — compounds known to cause sarcoma of the liver. His exposure to vinyl chloride ended in 1974. Decades later, in 2019, he was diagnosed with angiosarcoma of the liver and died in July 2020. His widow, Candice Martin, filed a civil suit in November 2021 under the Wrongful Death Act, 740 ILCS 180/0.01, et seq., and the survival statute, 755 ILCS 5/27-6, alleging that her husband’s occupational exposure caused his illness and death.

She named Goodrich and its successor, PolyOne, as defendants, seeking to proceed outside the workers’ compensation system by invoking §1.1 of the OD Act, 820 ILCS 310/1.1. That provision, added in 2019, allows a plaintiff to pursue a civil action if compensation is barred under the OD Act by the statute of repose.

The defendants moved to dismiss. PolyOne asserted a lack of personal jurisdiction. Goodrich argued that §1.1 was inapplicable because §1(f) constituted a statute of repose and that, in any event, the new provision could not retroactively revive a time-barred claim without violating constitutional due-process rights.

Workers’ Occupational Diseases Act and the Exclusivity Doctrine

The court reiterated that the OD Act was enacted to provide no-fault compensation for occupational diseases that are disabling as a result of workplace exposures (820 ILCS 310/1(d)). Like the Workers’ Compensation Act, the OD Act was intended to replace common-law remedies with a more efficient, administrative process. The exclusivity provisions under §5(a) of the OD Act bar civil actions for work-related injuries in most circumstances.

However, this exclusivity is not absolute. The Martin court noted that employees can pursue civil claims when their condition (1) was not accidental, (2) did not arise from the employment, (3) was not received during the course of employment, or (4) as in Martin, supra, is not compensable under the OD Act. 2025 IL 130509 at ¶20. This exception was squarely addressed in Folta v. Ferro Engineering, 2015 IL 118070, 43 N.E.3d 108, 397 Ill.Dec. 781, in which the Supreme Court upheld the exclusivity bar despite the claim being time-barred under the OD Act, concluding that the absence of a remedy due to the statute of repose did not render the injury noncompensable.

Folta led to widespread criticism due to its harsh result: the employee was left without any remedy. In response, the legislature enacted §1.1 in 2019, which explicitly allows civil actions when claims are barred under the OD Act by a statute of repose.

Section 1(f) is a Statute of Repose

The first issue was whether §1(f), which bars compensation unless disablement occurs within a specified period after last exposure, constitutes a statute of repose. 820 ILCS 301/1(f). The court held that it does. Like §6(c) — previously identified in Folta as a statute of repose — §1(f) operates to extinguish claims after a defined period, regardless of when the injury manifests or whether it has yet accrued.

The Martin court emphasized that both §§1(f) and 6(c) are conditions precedent to recovery. Compliance with both is necessary for a valid claim under the OD Act. Failure to meet these time limitations results not just in a procedural bar but a substantive extinguishment of the right to compensation. Thus, the protections of the OD Act, including the exclusivity bar, are no longer available to employers when §1.1 applies.

Section 1.1 Applies Prospectively

The court next turned to the temporal reach of 820 ILCS 301/1.1. Because the statute does not expressly provide whether it is retroactive or prospective, the court applied §4 of the Statute on Statutes (5 ILCS 70/4), which states that substantive amendments apply prospectively unless otherwise provided.

Section 1.1 was deemed substantive, as it created a new right of action outside the administrative system for certain claimants barred from relief under the OD Act. As such, it may not be applied retroactively to revive previously extinguished claims. However, when an occupational disease was discovered after the statute’s enactment, the court concluded that civil remedy under §1.1 is available.

Section 1.1 Does Not Violate Due Process

The final issue was whether applying 820 ILCS 301/1.1 to exposures that occurred decades earlier would violate employers’ due-process rights under the Illinois Constitution. The court rejected this argument, reasoning that employers do not have a vested right in the exclusivity defense until the cause of action accrues. This occurs when all elements of the tort claim are present — namely, the diagnosis or discovery of injury.

In this case, the court noted that the injury (angiosarcoma) was discovered in 2019, and the civil complaint was filed in 2021 — after the enactment of §1.1. Therefore, no vested right was disturbed. The exclusivity defense had not accrued before the legislative change, and the employer’s reliance on repose or exclusivity defenses did not carry constitutional weight under these facts.

This decision reverses the harsh outcomes resulting from Folta, supra, and signals the court’s continued deference to legislative corrections in the complex field of occupational diseases law. Practitioners should carefully evaluate exposure timelines, diagnosis dates, and procedural posture when assessing case viability, particularly in toxic exposure claims arising outside the traditional temporal scope of the Workers’ Compensation Act or the OD Act.

EMPLOYERS/CARRIERS/TPAs WITH THIRD PARTY SUBROGATION CLAIMS IN KANSAS – PAY ATTENTION TO HOW THE THIRD PARTY CLAIM SETTLEMENT OR RECOVERY IS DOCUMENTED AND INTERVIENE IN THE THIRD PARTY ACTION WHERE NECESSARY TO DOCUMENT THAT DAMAGES RECOVERED IN THE THIRD PARTY CLAIM ACTION ARE DUPLICITOUS WITH THE WORKERS COMPENSATION BENEFITS RECEIVED, AND SEEK LEGAL ADVICE BEFORE CASHING THE SUBROGATION RECOVERY CHECK.

Case Caption: Rumbaugh v. DirecTV, 65 Kan. App. 2d 266, 564 P.3d 17 (Kan. Ct. App. 2025)

Case Facts:

Justin Rumbaugh sustained a compensable low back injury on the job in 2014 and received workers compensation benefits.

In 2016, he developed cauda equina syndrome (compression of nerve roots at the bottom of the spinal cord).  He presented to an emergency room, was misdiagnosed, experienced a deterioration of symptoms including urinary complications, obtained treatment, but experienced continuing urological complications.

In 2018, he settled out the disability compensation portion of his workers compensation claim against DirecTV, but he left open his right to future medical paid for by workers compensation.

In 2020, he settled his third-party malpractice claim of “misdiagnosis” of the cauda equina syndrome for a significant amount of money. Kansas workers compensation law entitles the employer to stand first in line to recover the “duplicitous” workers compensation benefits paid up to the date of the third-party recovery (the lien). Kansas law also allows the employer a “credit” against future workers compensation benefits sought for the work injury, up to the dollar amount of the third-party recovery, to the extent they are “duplicitous.”

After the third-party settlement, the injured worker’s attorney mailed a check from third party recovery funds to the employer’s third-party administrator arguing the check amount satisfied any lien against future medical benefits under the Kansas work comp act. The third-party administrator accepted the check and cashed it, not contesting or clarifying the “accord and satisfaction” type language written on the check.

In 2021, because his work comp future medical rights remained open, Rumbaugh sought post-award medical treatment seeking payment of medical bills incurred after the 2020 third party settlement.

The workers compensation administrative law judge and Appeals Board denied claimant’s request, ruling DirecTV held a workers compensation subrogation credit towards future medical expenses to the extent of Rumbaugh’s entire medical malpractice recovery amount, so the employer was not required by the work comp judge to pay any medical bills until Rumbaugh exhausted the entire third-party recovery amount.

The Kansas Court of Appeals Decision:

First, as to the Appeals Board denial of Rumbaugh’s claim that the employer entitlement to a “credit” against additional future medical expense after the third-party recovery, the Court of Appeals held that Rumbaugh’s “accord and satisfaction” argument that the adjuster cashed the check as written and thereby waived entitlement to future credit against post third-party settlement medical expenses incurred, fails.  Note this was a decision on the technicality that Rumbaugh’s attorney failed to properly reserve that argument on appeal. In short, the “accord and satisfaction” argument by claimant’s attorney failed, but the real question of whether the language on the check was sufficient to defeat the employer’s future subrogation credit was not addressed by the Court of Appeals.

Second, the Court of Appeals reversed the Appeals Board ruling for the employer but remanded the case back to the Appeals Board to decide whether the third-party recovery was “duplicitous” with the workers compensation claim benefits claimant was awarded in the compensation claim. What that question really comes down to is whether claimant’s original low back injury settlement included entitlement to future medical for the urinary tract problems resulting from the medical negligence because they are “duplicitous.”  If the Appeals Board finds that the that future medical benefit entitlements from the original work injury include treatment for the urinary tract problems arising from the cauda equina syndrome, then the full third-party recovery amount by claimant would be subject to the subrogation “credit” and the employer would not owe for the medical treatment cost reimbursement claimant was making in his “post-award” action, because the ongoing cauda equina syndrome treatment was a direct, natural and probable consequence of the original low back work injury.

Case Take Aways For Employers/Carriers/TPA’s:

► Carriers and Third-Party Administrators should always consult defense counsel before cashing any third-party subrogation lien recovery check to ensure it has no language directly or indirectly causing the waiver of the employer/carrier’s additional and future subrogation “credit” rights as arising out of the third-party recovery amount.

► Carriers and Third-Party Administrators should not ignore third-party suits; rather, they should maintain some involvement to ensure third-party settlement or recovery proceeds are not structured in a way as to deny the employer a subrogation lien or credit by claimant attorney cleverly structuring the tort suit settlement characterization of damages a “non-duplicitous” of workers compensation benefits.  The employer position should be in the tort case that the tort damages are “duplicitous” of the workers compensation benefits received by the injured workers, to the extent possible to maximize the subrogation recovery.

►This decision debunks a claimant attorney’s arguments that only the district court in the tort suit action has jurisdiction to determine the “duplication” of benefits issue. In the past, some claimant attorneys have alleged that only the tort suit district court has jurisdiction to make the duplication of benefits determination. Here the Kansas Court of Appeals remanded to the Workers Compensation Appeals Board (the State work comp agency) to make the determination of what damages are duplicitous and what were not.

 About the Author: This update was prepared by National Workers’ Compensation Defense Network Kansas member Kim R. Martens of the Wichita, KS firm MARTENS WORK COMP LAW LLC, a law firm dedicated to representing self-insured employers, insurance carriers, and third-party administrators in all matters related to workers compensation before the Kansas Division of Workers Compensation and the Kansas appellate courts. If you have any questions about this submission or Kansas workers compensation in general, please contact Mr. Martens by either e-mailing him at Kim@MartensWorkCompLaw.com or by calling him directly at 316-461-0135.

Maine’s workers’ compensation stakeholders will be gathering at Sundy River, in Bethel, Maine, on October 8 and 9, 2025, to hear from industry experts on topics of critical concern to the various people who keep the system runnning.  Seminar topics include MSA’s in a post-Chevron world; Rethinking Physical Therapy in Complex Workers’ Compensation Cases; Navigating Claims for Psychological Injuries;  Collective Bargaining Agreements and Workers’ Compensation; The Interplay of ADA, FMLA, PFML and WC; and Is Carpal Tunnel Work Related Because I Said  So.

This gathering of lawyers, adjusters, vendors and Board employees is important as it allows the various stakeholders to mingle and talk about topics that are important to discuss in the ever-changing landscape that is workers’ compensation in Maine. Registration is open until Sunday, October 5, so if you have not yet registered, there is still time. Stay tuned for a recap following the event.

 In Pham v. Smithfield Foods, 2025 S.D. 41, the South Dakota Supreme Court affirmed that an Insurer may accept an injury as compensable without waiving the right to later deny benefits.  In this case, the claimant, Jody Pham, was injured while working for Smithfield Foods. Smithfield voluntarily paid Pham workers’ compensation benefits for over two years.  Then Smithfield ceased payments upon belief and evidence that Pham’s work injury was no longer a major contributing cause of her condition.  

Pham petitioned the Department of Labor for benefits, and the Department denied her claim.  On appeal, the circuit court reversed.  The Circuit Court stated that, under SDCL 62-7-33, once Smithfield accepted compensability of Pham’s claim, Smithfield was bound to continue to pay Pham workers’ compensation benefits unless Smithfield showed that Pham had a change in condition allowing for termination of benefits under SDCL 62-7-33.

The South Dakota Supreme Court reversed the Circuit Court and affirmed the Department.  The Supreme Court held that SDCL 62-7-33 applies only after the Department issues an order determining that an injury is compensable, either through a voluntary settlement or after a contested hearing.  Importantly, the Supreme Court further affirmed that, as a matter of public policy, an Insurer should not be penalized for voluntarily accepting a claim as compensable then later denying that claim.  

Put differently, an Insurer’s voluntary acceptance of a claim does not shift the burden of proof onto an Insurer to show that a claim is no longer compensable before the Insurer can deny benefits.  Instead, under South Dakota law, the burden to establish a compensable injury remains with the claimant at all times until a final order declaring that an injury is compensable is issued by the Department.  Only after the Department issues an order establishing that an injury is compensable does the burden shift to an Insurer to show a change in condition under SDCL 62-7-33. A settlement agreement adopted by the Department also constitutes a final order that shifts the burden to an Insurer to show a change in condition under SDCL 62-7-33.

The Pham decision is a significant victory for Insurers and workers in this state.  The Pham decision rightfully recognizes that South Dakota law does not penalize an Insurer for voluntarily paying benefits. This decision allows Insurers and Employers to effectively and quickly administer claims and provide injured workers the care they need without first requiring claimants to fully litigate their claims.

The Pham decision also overruled a South Dakota federal district court decision, Hollow Horn v. Firstcomp Ins. Co., No. CIV. 17-5016-JLV, 2021 WL 1909707 (D.S.D. May 12, 2021).  In Hollow Horn, a claimant raised a similar argument to the Circuit Court in Pham.  The claimant argued that because his insurer initially accepted his work injury as compensable, then his insurer had a continuing obligation to continue to provide workers’ compensation benefits.  The federal district court accepted this argument, which effectively penalized the insurer for voluntarily providing workers’ compensation benefits.  Now, however, the Pham decision shows that Hollow Horn was erroneous. In South Dakota, an insurer suffers no penalty for voluntarily accepting a workers’ compensation claim as compensable.

Claimant filed a Petition alleging a cumulative detrimental effect injury to her bilateral knees resulting from her work as a Stower at an Amazon warehouse. After Hearing, the Board issued a Decision, denying the Petition, and accepting the opinion of defense expert Dr. Gelman over claimant’s treating physician Dr. Palma.

Both experts agreed claimant had pre-existing conditions in her knees including patella alta (high riding kneecap), genu varum (bowleggedness), that create altered mechanics and abnormal forces on the knees. These conditions are physiologic and developmental, and likely contributors or causes of claimant’s knee complaints. Both experts agreed with the diagnosis of chondromalacia patella. Symptoms associated with chondromalacia patella can come and go with time, and be aggravated by walking for exercise or claimant’s biomechanical issues. Claimant had treatment for the bilateral knees in 2023 including physical therapy. Her complaints then were very similar to the complaints in August 2024. Dr. Gelman felt the treatment in August 2024 was likely for the same condition that existed in 2023 as opposed to something new.

The Board shared concerns expressed by Dr. Gelman about the credibility of Claimant’s medical history and exaggerations in the type and extent of work activities she was engaged in during the weeks and months leading up to 8/22/24. Dr. Palma conceded he relied on claimant’s history in forming his causation opinion.

Claimant denied a history of prior knee problems in her intake paperwork with Dr. Palma in the fall of 2024 and did not reveal the history of severe bilateral knee pain and treatment in 2023 when she saw him in November 2024. Dr. Palma became aware of this history on the date of his deposition. Dr. Palma said the prior records would not change his causation opinion if claimant became pain free after the 2023 treatment. The last known medical record from the 2023 treatment was a physical therapy note dated 1/5/24 that showed 6/10 bilateral knee pain. The Board was therefore not persuaded her 2023 knee pain resolved, commenting “improvement is not the same as resolution.” The Board did not find it believable that claimant somehow forgot the severe bilateral knee pain in 2023, the time she was out of work and treated for same, by the time she saw Dr. Palma in the fall of 2024.

The Board agreed with Dr. Gelman that claimant exaggerated her work hours and activities in the timeframe immediately prior to the alleged 8/22/24 date of manifestation. Payroll records documented she worked substantially less hours than she claimed, including 5.5 hours the week before the alleged date of manifestation, and 17.07 hours the week before that, and less than full time many weeks prior. Claimant testified she spent half her day squatting and the other half climbing stepladders, but an employer representative testified the job requires 11-25% squatting and 1-10% climbing. The job is mostly walking. Lifting requirements are fairly light. Amazon updates their job descriptions yearly to make sure these averages are accurate. The Board did not dispute that there were physical demands with the job, but felt claimant overstated same.  

Should you have any questions regarding this Decision, please contact John Ellis or any other attorney in our Workers’ Compensation Department.

Desardouin v. Amazon.com, IAB Hrg. No. 1550750 (July 11, 2025).

The Oklahoma Supreme Court issued an opinion with major ramifications on workers' compensation on September 9, 2025.     The case is OBI Holding v. Schultz-Butzback, 2025 OK 55.  The case clarifies Title 85A O.S. §69 (A)(4)(b) the Statue of Repose for a workers’ compensation claims.

The text of 85A §69 (A)(4) states:

If a claim for benefits has been timely filed under paragraph 1 of this subsection and the employee does not:

a.      A.  Make a good-faith request for a hearing to resolve a dispute regarding the right to receive benefits, including medical treatment, under this title within six (6) months of the date the claim is filed, or

b.       B.  receive or seek benefits, including medical treatment, under this title for a period of six (6) months,

then on a motion by the employer, the claim shall be dismissed with prejudice.

The ALJ’s and Commission had incorrectly interpreted the Statue that if subsection (a) was satisfied then subsection (b) was not applicable. 

The Supreme Court held that both provisions of the Statue shall be satisfied.  They highlighted two distinct time periods in which an Employer make seek dismissal of a claim.  The Court found the Statue requires an Employee to actively pursue their claim by receiving or seeking benefits during any period of six (6) months throughout the life of the claim.  An Employee’s failure to receive or seek benefits for any six (6) months triggers the Employer’s right to move for dismissal of the claim with prejudice.