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Evolving Employer Liability Issues

I. Pleading Around the Worker’s Comp Bar

II. Apportioning Fault Against Non-Party Employers

Worker’s Comp Act – In General

Traditional Exceptions to Exclusivity Bar of Worker’s Compensation Act:

1. Intentional torts committed by employer2. Gross neglect

Emerging Threats to Exclusivity Bar:1. “Substantial Certainty” – when employer was

“substantially certain” injury would occur2. Irregular Causes of Action

a) Fraudb) Batteryc) Intentional Misrepresentation

Intentional Torts

• Assault-like Element Required: In most jurisdictions, an employee must prove that the employer acted with conscious deliberate intent, “comparable to an intentional left jab to the chin,” to cause the employee’s injury

• An employer’s willful and wanton, grossly negligent, or even reckless misconduct is insufficient

Sample Intentional Tort Cause of Action

Redefining INTENT Substantial Certainty Standard

• Departure from “actual intent” standard ?

• Employee must show:– Harm was “substantially certain” to occur as a

result of the employer’s act; and– Employer knew its actions were “substantially

certain” to cause injury.

Sample Cause of Action Pleading “Substantial Certainty”

COUNT ONE

Intentional Tort Allegations Against Premises Defendants

• Defendant’s unmitigated failure to provide its employees, including Plaintiff, with a safe working environment around asbestos or asbestos-containing materials, rises to the level of intentional conduct, and any injury resulting there from rises to the level of an intentional injury, as Defendant knew with a substantial certainty that employees such as Plaintiff would be exposed to asbestos through their job duties; and knew with a substantial certainty that employees such as Plaintiff would contract an asbestos related illness, including asbestosis, by reason of their job and job duties at the premises.

• In fact, based on the extent of Defendant’s knowledge of the health hazards of asbestos exposure and the ubiquitous use of asbestos during Plaintiff’s years of employment, it is impossible that Plaintiff was not substantially certain of these facts.

• Because Defendant was substantially certain, as set forth above, that an employee like Plaintiff would contract an asbestos-related illness, including asbestosis, Plaintiff’s actions rise to the level of an intentional tort.

Additional Example (from Arkansas Complaint)

Where has “Substantial Certainty” Standard Been Adopted?

• Eight States – Judicially Adopted:– Connecticut– Louisiana– Minnesota– New Jersey– North Carolina– Oklahoma– South Dakota– Texas

• Repeal of Judicially-Adopted Substantial Certainty Test by Statute:– Ohio– West Virginia

What does “Substantial Certainty” Even Mean?

Synonyms of SUBSTANTIAL:

• Big, consequential, earthshaking, earth-shattering, eventful, historic, major, material, meaningful, momentous, monumental, much, significant, important, tectonic, weighty

http://www.merriam-webster.com/

Synonyms of CERTAINTY

• Assurance, assuredness, confidence, certitude, cocksureness, conviction, doubtlessness, face, positiveness, satisfaction, sureness, surety

http://www.merriam-webster.com/

Even Plaintiffs’ Experts Disagree About how to Define the Knowledge Element of “Substantial Certainty”

Frank Parker “Substantially Certain” Clips

04-03-09 Wilhite Depo

Frank Parker “Substantially Certain” Clips

04-03-09 Wilhite Depo

Arthur Frank “Substantially Certain” Clips

04-17-09 Wilhite Depo

Judicial Definition of “Substantial Certainty”

1. Intent to commit ACT that produced the injury

– Minnesota: • Must be intentional or deliberate• Mere negligence insufficient• RAM Mut. Ins. Co. v. Meyer, 768 N.W.2d 399 (Minn. App. 2009)

– Connecticut:• Evidence of lackadaisical or cavalier attitude towards safety

insufficient• Sullivan v. Lake Compounce Theme Park, Inc., 277 Conn. 113,

118 (2006)– South Dakota:

• Evidence of gross negligence insufficient• Standard is not “virtual certainty,” but substantial certainty• Fryer v. Kranz, 616 N.W.2d 102, 105 (S.D. 2000)

– Oklahoma:• Employer must have intended the act that produced the injury• Price v. Howard, 236 P.3d 82, 88 (Okla. 2010)

2. Intent to INJURE the employee

– New Jersey:• Requires more than knowledge and appreciation of the risk• Crippen v. Central Jersey Concrete Pipe Co., 775 A.2d 716

(N.J. App. Div. 2001)

– Louisiana• Employer’s belief that there is a high probability that

someone may, or even probably will, get hurt if a workplace practice is continued is insufficient

• Must show that the employer had a subjective appreciation that the injury was virtually certain, inevitable, or incapable of not occurring

• Reeves v. Structural Preservation Systems (La. 3/12/99) 731 So.2d 208, 213

Legislative Responses

• Florida and Michigan After Supreme Court adopted the “substantially certain” standard, their legislatures eliminated the standard by statutorily defining “intent” to exclude the “substantially certain” standard

• West Virginia Legislature adopted its own 5-part test– Existence of unsafe working condition that contained a “high

degree of risk and a strong probability of serious injury or death”– A “subjective realization and an appreciation” of that risk and

probability on the part of the employer– A violation of a statute or regulation or an accepted safety

standard that addressed the situation at issue specifically– Intentional exposure of the employee by the employer to the

condition; and– Serious injury or death of the employee as a result of the unsafe

condition

Could Employers in the 1960s and 1970s Have Been “Substantially Certain”

that Their Employees Would Develop Asbestos-Related Diseases?

• Exposure to asbestos only increases a person’s risk of asbestos-related disease to 1 in 100,000, or less than 1%.

• Odds of contracting the flu are 1 in 5, or 20%

• Odds of developing carpal tunnel syndrome is 1 in 20, or 5%

Yet Plaintiffs Experts’ Answer This Question in the Affirmative

Frank Parker “Substantially Certain” Clips

04-03-09 Wilhite Depo

Frank Parker “Substantially Certain” Clips

04-03-09 Wilhite Depo

Arthur Frank “Substantially Certain” Clips

04-17-09 Wilhite Depo

Arthur Frank “Substantially Certain” Testimony Struck

04-17-09 Wilhite Depo

Dr. Frank testified:

1. Asbestos-related disease was “substantially certain” to occur even at today’s legal levels.

2. The employer defendant was “substantially certain” that the asbestos disease would occur in some percentage of employees. STRUCK

PART TWO:

Apportioning Fault Against Non-Party Employers

Use of Regulations

• Sword: Proving up Negligence of “Empty Chair” Premises or Employer Liability Defendants

• Shield: Demonstrating Compliance with Regulations to Show Premises Liability or Manufacturing Defendant was Not Negligent

California Case-in-PointStewart et al. v. Union Carbide Corporation Los Angeles Sup. Ct. no. BC 384224 (11/16/10)

• Plaintiff’s counsel argues this case stands for the proposition that evidence of OSHA regulations is admissible to prove notice to Defendants and for no other purpose

• In reality, the OSHA discussion occupies a single page, and the Court indicated that the following limiting instruction regarding the 1972 OSHA standards on asbestos was not error

Instruction Given

“…information on government standards has only been allowed for the limited purpose of notice or as to what information was available to defendant Union Carbide Corporation and others. Compliance with government standards or regulations does not preclude the potential imposition of liability for a defective product or negligence.”

• The Court of Appeals approved of the instruction as a correct statement of the law, and noted that Union Carbide was nonetheless properly permitted to make the argument that “OSHA regulations are the law.”

– In other words, the limiting instruction was not error, but neither was defense counsel’s argument

• Reconciling the two prongs of the court’s ruling:

– Evidence of compliance with a government regulation may be used as evidence of negligence by any party or non party

Negligence per se

• Eases the burden of proof in a tort case

• Distills number of facts to be determined by jury to one – whether the defendant committed (or omitted) the regulated act

• If the violation occurred, the defendant is automatically liable

• If there was no violation, there can be no liability

Blurring the Issue: Cal-OSHA

Labor Code section 6304.5: Neither the issuance of, or failure to issue, a

citation by the division shall have any application to, nor be considered in, nor be admissible into evidence in a personal injury or wrongful death action, except as between an employee and his or her own employer. Sections 452 and 669 of the Evidence Code shall apply to this division and to occupational safety and health standards adopted under this division in the same manner as any other statute ordinance, or regulation.

In the same recent trial, Plaintiffs argued that the existence of this statute supported their reading of Stewart as a complete bar to the admission of OSHA evidence by any Defendant

Why Plaintiffs’ interpretation is WRONG

1. Ignores legislative history of § 6304.5– Enacted in 1971– Long before advent of modern day complex toxic tort and

asbestos litigation, where success is typically premised on proving up alternate exposure by a third party defendant

– Early on, statute was interpreted as a bar to the presentation of evidence to prove the negligence of Cal-OSHA’s safety inspectors, who were being sued for failing to cite safety violations that later caused injury:

• “The fact that the state has a mandatory duty to inspect and to enforce Cal-OSHA is irrelevant to the issue of whether those provisions can be relied upon in a personal injury action against the state when the state is not the employer. It is evident that the purpose of section 6304.5 is to prevent the technical Cal-OSHA safety provisions from enlarging the personal injury liability of third parties beyond basic common law liability.”

• State of California only defendant involved in appeal.• Brock v. California, 81 Cal. App. 3d 752, 754 (1978)

2. Only applied to bar evidence of non-compliance with Cal-OSHA, not federal or other state regulations

3. Statute amended in 1999 – Common law rule restored, and defendants

are now once again permitted to use “Cal-OSHA provisions to establish standards and duties of care in negligence actions against private third parties.”

– Elsner v. Uveges, 69 Cal. Comp. Cas 1511 (2004)

Is Mesothelioma Covered by Worker’s Comp? Bearce v. Gen. Dynamics Corp.

• 1971: Texas amended WCA to cover mesothelioma

• Bearce case (2011) – Federal MDL– Plaintiff’s injuries occurred in 1960s– Held: WCA did not bar PL’s common-law action for

mesothelioma-related injuries because his injuries occurred before they were compensable

• Criticism: court used definition of “bodily injury” commonly used in insurance policy context, not tort context

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