litigation management: negotiations, settlements, judging case value & documenting the agreement...

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Litigation Management: Negotiations, Settlements, Judging Case Value & Documenting the Agreement Presented by: Thomas F. Coleman, Esq. Slide 2 Determine Case Value Know Applicable Law Law in effect on date of injury controls (Joyce v. Lewis Bolt & Nut Co., 412 N.W.2d 304 [Minn. 1987]) Temporary Total Disability DOI pre-October 1, 1995: no cap DOI pre-October 1, 1995 to September 30, 2008: 104/week cap DOI on/after October 1, 2008: 130/week cap Temporary Partial Disability DOI pre-October 1, 1992: no cap DOI on/after October 1, 1992: 225-450/week Slide 3 Determine Case Value (cont.) Permanent Total Disability Retirement Presumption DOI prior to 1/1/84 none DOI 1/1/84 to 9/30/92 presumed retired if receiving social security old age or retirement benefits (rebuttable) DOI 10/1/92 to 9/30/95 none DOI on/after 10/1/95 Age 67 retirement presumption (rebuttable) Social Security Disability, Survivors Retirement Offset after $25k paid in PTD Slide 4 Determine Case Value (cont.) Permanent total disability thresholds DOI on/after October 1, 1995 Irrebuttable presumption Thresholds 17% PPD 15% PPD and employee at least age 55 on DOI 13% PPD; employee at least age 55 on DOI; not high school graduate/no GED Minn. Stat. 176.101, subd. 4 and 5 Is employee permanently totally disabled, i.e. given age, education, transferrable skills, disability, and relevant labor market, is employee capable of nothing other than sporadic employment with insubstantial income? Slide 5 Determine Case Value (cont.) Permanent Partial Disability DOI January 1, 1989 to September 30, 1995: Impairment compensation (IC) and economic recovery compensation (ERC) DOI on/after October 1, 1995: Impairment compensation only DOI on/after October 1, 2000: New PPD schedule increases dollar multiplier for PPD ratings (Minn. Stat. 176.101, subd. 26) Slide 6 Determine Case Value (cont.) Cost of Living Adjustment (COLA) (Minn. Stat. 176.135) DOI prior to October 1, 1992: First COLA on first anniversary date of injury; maximum COLA 6% For DOI from October 1, 1992 to September 30, 1995: First COLA on second anniversary date of injury; maximum COLA of 4% For DOI on or after October 1, 1995: First COLA on fourth anniversary date of injury; maximum COLA of 2% Slide 7 Determine Case Value (cont.) Medical Benefits (Minn. Stat. 176.135) Reasonable and necessary for cure or relief Medical treatment parameters (Minn. Rule 5221.6010 to.8900) not applicable if: Primary liability denied; or Secondary primary liability denial Medical Fee Schedule (Minn. Rule 5221.0100 to.4070) Slide 8 Determine Case Value (cont.) Vocational Rehabilitation/Retraining (Minn. Stat. 176.102) Slide 9 Determine Case Value (cont.) Dependency Benefits (Minn. Stat. 176.111) Slide 10 Know the Claim Benefits paid to date TTD/TPD caps Attorney fee paid/withheld PPD Overpayments to recoup per Minn. Stat. 176.179 Employees background Future earnings capacity/employability Age Educational background Employment history Transferrable skills Disability/restrictions Relevant labor market Employee credibility/ claim savvy Prior claims/litigation Criminal record Surveillance Slide 11 Know the Claim Available Defenses Primary liability Causation Apportionment TTD defenses per Minn. Stat. 176.101 Nature and extent of injury Contribution Fee Schedule Whether employee is qualified employee for vocational rehabilitation under Minn. Stat. 176.102 MMI post 90 days Exclusion of medical provider under managed care plan Slide 12 Know the Claim Review Medical records Vocational rehabilitation records Job logs Personnel/wage record DOLI file Social Security file Discovery Employees deposition/deposition rsum/recorded statements IME reports Independent vocational evaluation reports Witness statements/depositions Slide 13 Know the Claim Is Case Ripe for Settlement? Restrictions permanent or fluid? Medical treatment done or pending? MMI IME IVE Potential future claim retraining/medical/PPD/indemnity Slide 14 Know the Claim Know Judge Petition for Judicial Reassignment 10 days Petition for Judicial Reassignment cause Minn. Stat. 176.312 Minn. Rule 1420.2600 Slide 15 Know the Costs of Litigation Defense attorney fees Costs of medical expert/vocational expert Disruption of insureds business Discovery Cost of maintaining reserves/open file Opposing counsels: Costs Attorney fees: Contingent Hourly Roraff.191 fees Heaton Edquist Slide 16 Exposure/Settlement Evaluations Get Realistic Slide 17 Settlement Conclusively Presumed To Be Reasonable, Fair, and In Conformity With Act No Judicial Approval Required All parties represented by legal counsel (not applicable to intervenors) Medical and vocational rehabilitation benefits are NOT closed out full final. Legal guardian or conservator NOT required Minn. Stat. 176.521, subd. 2 Slide 18 Negotiations With Opposing Counsel Know Thine Enemy Experience Caseload Ability to try a case Willingness to: Try a case Settle Financial position Calendar conflicts Negotiating techniques Slide 19 Negotiations With Opposing Counsel Know settlement authority WCRA approval necessary? Be reasonable Do not overreach on pro se employees Do not bid against yourself Slide 20 Deal with Intervenors Appropriately Know extent of claim, apply Fee Schedule, be aware of Spaeth claims Give intervenors Notice of Right to Intervene Failure to do so may result in 100% liability Intervenors failure to timely intervene after notice may extinguish their claim (Minn. Stat. 176.361) 30 days after notice of administrative conference; or 60 days after service of notice of right to intervene. Both Employee and Employer/Insurer have obligation to investigate intervention claims and give notice to potential intervenors Fee schedule bills when appropriate Slide 21 Documentation of Settlement Utilize attorney Contents of Stipulation (Minn. R. 1420.2050, Subp. 1) Statement of admitted material facts Matters in dispute/employee claims attach supporting documentation Employer and Insurers claims/defenses attach supporting documentation Stipulated facts (e.g. DOI, nature of injury, MMI) Establish settlement is fair and reasonable Preserve subrogation rights per Minn. Stat. 176.061 Slide 22 Documentation of Settlement Contents of Stipulation (Minn. R. 1420.2050, Subp. 1) Intervenors Claim itemization Extinguish intervention rights failure to timely intervene Settlement terms Payments Close outs be precise, explicit; specify with particularity all benefits closed out* Cannot close out unknown claims as claims not yet in dispute, i.e. consequential injuries * A stipulation need not explicitly reserve the age 67 retirement presumption as a defense to a PTD claim. Frandsen v. Ford Motor Co., 801 N.W.2d 177 (Minn. 2011) Slide 23 Contents of Stipulation (cont.) Attorney Fees Previously withheld fees Contingent Hourly Roraff, Heaton,.191, Edquist Costs Slide 24 Social Security (SSDI) Language Of the $________ settlement, the sum of $_______ is to be paid to the Employees attorney as and for attorneys fees. The Employee is currently ___ years old having been born on _______, and has a life expectancy of ___ years, ___ months. The balance of $________ shall be paid to the Employee and shall represent a compromise payment of weekly indemnity benefits over the projected term of the Employees life expectancy of ____ months, at the rate of $_____ per month, or $_____ per week. - Or - Slide 25 Social Security (SSDI) Language That it is stipulated by and between the parties that had the Employee proceeded to trial and been successful with his permanent total disability claim, he would have been found to be permanently and totally disabled as of (_________). It is further stipulated by and between the parties that in arriving at the lump sum figure, the parties utilized the social security offset provision found in Minn. Stat. 176.101(4). Specifically, it is stipulated by and between the parties that Employee would have been paid $25,000.00 in weekly permanent total disability benefits as of (___________), had this case been actually litigated and an Award of permanent total disability benefits entered by a compensation judge. In calculating a lump sum payment, Employer and Insurers applied the social security offset as of (__________). In other words, the money being paid to the Employee in connection with this Stipulation for Settlement was arrived at by reducing Employees permanent total disability benefits by the monthly amount of social security. Employee has opted to receive reduced permanent total disability benefits in the form of a lump sum pursuant to the Stipulation for Settlement rather than receiving them on a periodic basis, having accepted a discount to present value. Additionally, it is recognized that the offset provisions of Minn. Stat. 176.101(4) (and Minn. Stat. 176.132(2)(e)) have been applied to this case, arriving at the lump sum. Slide 26 Medical Closeouts Typical soft medical expenses Chiropractic Acupuncture/acupressure Chronic pain clinic (inpatient/outpatient) Psychiatric/psychological Chemical dependency treatment Health club Durable medical equipment Durable exercise equipment Household remodeling Home nursing services by family members Massage therapy Treatment with certain healthcare providers Motor vehicle modification Certain medications, e.g. narcotics. Slide 27 MSA Trust Must account for and reasonably allocate to Medicares interests if: Employee receiving SSDI Employee over age 65 Reasonable expectation of Medicare enrollment within next 30 months CMS approval of MSA Trust required if: Employee: Medicare eligible; and Settlement is $25,000.00 or more; or Reasonable expectation of Medicare enrollment within 30 months and settlement exceeds $250,000.00 Bifurcate work comp settlement from MSA Trust approval Slide 28 Medical Closeouts Be aware of the employees situation regarding Social Security and whe