The California courts may be on the verge of clarifying the required standard for using vocational expert testimony to rebut the California permanent disability rating schedule under the Ogilvie case.
Around a year ago Contra Costa County filed a Petition for a Writ of Review in the Doreen Dahl v. Contra Costa County case. In January 2015 the California Court of Appeal, First District granted the writ. Major stakeholders submitted amicus briefs in early 2014.
The Dahl case is being handled by Arjuna Farnsworth from my office at Boxer & Gerson LLP.
The issue at stake is what standard is to be used in rebutting the PDRS. Can a worker who is not totally disabled rebut the schedule under Ogilvie? And must vocational expert testimony focus on the particulars of the individual worker and the various factors (industrial and non-industrial) that affect their earning capacity? Or can the vocational expert focus on the effect of the injury on a hypothetical similarly situated worker? If the schedule is successfully rebutted by vocational testimony on diminished future earning capacity, is it the rating string’s final number that is rebutted or is it the medical WPI rating which is rebutted and then adjusted out for age and occupation?
For example, should the voc expert in Dahl have factored in the fact that the worker had a criminal record and moved to a smaller town with a smaller labor market?
These issues, while extremely important for some high-value claims, may have limited impact systemwide. Why?
First, the SB 863 reforms in 2012 included language aimed at eliminating diminished future earning capacity arguments under the Ogilvie case for injuries after January 1, 2013. If the schedule is to be rebutted in post January 1, 2013 injury cases , the rebuttal criteria will have to be somewhat different.
Second, in many areas of the state Ogilvie has not been a tool used by applicant attorneys. Prominent Southern California defense attorney Michael Sullivan noted at a CAAA conference that when he mentioned Ogilvie at Southland claims meetings, he could hear crickets. In the Bay Area, however, top tier applicant attorney firms have been able to use a DFEC approach in selected claims in an effort to get an accurate and adequate recovery for workers.
Third, as time goes along there are fewer cases that may be subject to the DFEC approach. The original trial level Findings and Award in Dahl was on September 11, 2011. Many cases of this type have already worked their way through the system and are resolved in some fashion.
However, it bears repeating that the issue is a critical one for some workers with significant wage losses whose claims remain unresolved.
I posted on “Dahl I” after the WCAB panel of May 18, 2012 issued. Here in italics is an explanation from that post:
After the Court of Appeals holding in Ogilvie, many of us have been waiting to see what the WCAB would do.
How would the WCAB interpret the 1st DCA’s Ogilvie decision?
In its decision the Court of Appeals rejected the mathematical formula that the WCAB had developed for possible rebuttal of the PD schedule but outlined 3 possible methodologies fro rebuttal of the schedule.
One method? A party could show a factual error in the application of a formula or the preparation of the schedule.
Another method? A party may prove that medical complications of the injury are not captured in the schedule.
But it is the third method that has drawn the most interest. A party may attempt to rebut the PDRS by demonstrating the effect of the injury on the employee’s rehabilitation. In outlining this method, the Court of Appeals noted no meaningful difference between the terms “diminished future earning capacity” and “ability to compete in the open labor market”.
But the Ogilvie court remanded the case back to the WCAB for further development of the record.
Subsequently the Ogilvie case itself was settled, so there was never to be another review of the Ogilvie case by the 1st DCA.
But if the logic of the old California Supreme Court LeBoeuf decision still lives, then would that be applicable only to 100% cases, or also to cases where the worker is less than totally permanently disabled?
A recent WCAB panel decision, Dahl v. Contra Costa County (ADJ1310387) answers that question. The panel of Commissioners Frank Brass, Alfonso Moresi, and Marguerite Sweeney hold that a LeBoeuf type of analysis may properly applied in a case involving less than 100% permanent disability when it is shown that the injury impairs the employee’s rehabilitation.
In that post I noted that:
Dahl’s rating would be 59% if the PDRS was not rebutted, and the WCJ ruled that the rating would be 59%, rejecting any attempt to rebut the rating by using vocational expert testimony if the case was less than 100%. essentially, the WCJ ruled that the attempt to rebut the schedule would fail under Ogilvie unless the worker could show a total loss of earning capacity.
Not so, said the WCAB panel.
What is particularly interesting about the panel decision in Dahl is that they seem to adopt the reasoning expressed by Commissioner Ronnie Caplane in her dissent in the earlier en banc decisions of the Appeals Board in Ogilvie.
The Dahl panel quotes Caplane’s dissent as follows:
“The percentage of her actual loss of future earnings as demonstrated by both parties’ expert witnesses is the most accurate reflection of her diminished future earning capacity. Therefore, her permanent disability rating should be the percentage pure earning capacity of her lost future
“The method that I propose is comprehensive, analytically sound, and operationally simple. It would require vocational or other experts to estimate the injured employee’s post-injury earning capacity based upon medical opinions evaluating her permanent and earning capacity had she not suffered the industrial injury, both to be determined from the permanent and stationary date through her projected years in the work force. Such expert testimony is common in marriage dissolution cases, permanent injury cases, and employment cases.”
One is led to conclude that a solid majority on the WCAB now concludes that vocational expert testimony is a valid methodology to rebut the PDRS, and vocational experts can do this by assessing the percentage of diminished future earning capacity. In essence, the testimony is rebutting the entire PD string, not merely the FEC factor.
On January 16, 2014 the WCAB issued a “Dahl II” panel decision, authored by Commissioners Sweeney, Brass and Moresi. After the “Dahl I” panel remanded the case to the trial judge, the WCJ issued a ruling finding that the scheduled rating was rebutted and finding a 79% rating, relying upon the testimony of vocational expert Jeff Malmuth who used a “similarly situated” analysis.
So it was defendant who was appealing in “Dahl II”.
In “Dahl II” the board noted that:
Notwithstanding the uncertainty in the Ogilvie III holding regarding the consideration of individualized factors in determining DFEC as part of a LeBoeuf analysis as discussed above, we find that the approach taken by applicant’s expert Mr. Malmuth in this case is not contrary to Ogilvie III because it does not consider the impact of applicant’s shoulder injury based on any “impermissible factors” identified in Ogilvie III, but instead looks at the effect such an injury would have upon the DFEC of similarly situated workers. In that way the analysis provided by Mr. Malmuth reconciles the apparent contradiction between the Ogilvie III statement that individual factors that do not arise from the industrial injury are not to be considered in a DFEC analysis post SB 899, with the view of the Supreme Court in Montana that an individual’s ability to work, age, health, skill, and education along with the general condition of the labor market, and employment opportunities for persons similarly situated are all relevant in considering the individual’s future earning capacity.”
As a result the panel in “Dahl II” affirmed the WCJ’s decision that the scheduled rating had been rebutted, upholding the finding of 79% disability.
The Ogilvie case was decided by the First District Court of Appeals.
For several years now I’ve been explaining to clients that there was remarkably little guidance from the courts on the methodology that vocational experts could use in formulating their opinion in these cases. It has been “the Wild West”. Some voc experts used alternative methodologies in formulating their opinions.
Presumably in Dahl the First District Court of Appeals will give the workers comp community guidance on these issues.
Stay tuned. This week I will be posting my yearly quiz on California workers’ comp predictions for 2015.
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