Sheff Law also argued that under the case of Hultin v. Harvey, the workers compensation insurer would lose its Hunter rights in the future since its recovery on the third party case had exhausted all damages recoverable under Section 15. That argument was not particularly relevant in our case because our client had already resolved his workers compensation case by means of a lump sum settlement. Thus, there was no possibility that the plaintiff could claim lost wages benefits in the future.
As the client was essentially at a medical end point, the potential for future workers compensation claims for medical treatment was limited. It should be noted further that there is also a potential argument to be made that not only would we have been able to allocate all but approximately 20% of the total settlement to pain and suffering, but furthermore, the insurer would have had an obligation to take less than that amount due to their requirement to reduce their lien by a proportionate share of legal fees and costs under M.G.L. Ch. 152, Section 15. As a result, we argued that they would have had to reduce their recovery by an additional 35-38%.
In Curry, the Court allowed an allocation of a $300,000 arbitration award with $100,000 to the loss of consortium claims, $100,000 to pain and suffering and $100,000 to wages, making only the $100,000 subject to the lien, because pain and suffering and loss of consortium damages are not compensable under the workers compensation statute. In Hultin, the Court approved an allocation of 79% of the proceeds to the loss of consortium case and only 21% to the employee's case. As a result, there is precedent that allows a very significant percentage of the third party case to be allocated to damages other than those of the employee.
Before the motion was filed, the workers compensation insurer relented and agreed to accept 1/3 of the settlement with the "Hunter" offset in place for any potential future benefits. We were comfortable letting the Hunter argument go because, as indicated above, it was essentially a Pyrrhic victory for the insurer, given the minimal chance of additional workers comp claims by our client in the future. Apparently, the insurer viewed the very real potential that they could have been forced to accept even less than the 1/3 of the total settlement that we were offering as well as the potential to set additional precedent that could have led to further reductions in the amounts it will be reimbursed in the future for its liens on third party cases.
In sum, the recent decision in Curry v. Great American (combined if possible with Hultin v. Harvey) provides the plaintiff's bar with a new tool to use when negotiating workers compensation liens on third party cases. As Curry v. Great American is a very recent appellate decision; it will be interesting to see how this tool is used to maximize the recovery made by plaintiffs with workers compensation liens on third party cases.
