2018 YLS Best Practices Seminar - cdn.ymaws.com

2018 YLS Best Practices Seminar

March 9, 2018 Creighton University School of Law, Omaha, NE

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2018 YLS Best Practices SeminarFriday, March 9, 2018 • 9:00 am - 4:00 pm

Creighton University School of Law • 2133 Cass St., Omaha*NE MCLE Activity #154175. IA MCLE Activity #289350. 5 CLE hours. (Regular/live)

*NE MCLE Activity #154176. IA MCLE Activity #289349. 5 CLE hours. (Distance learning)*Only 5 distance learning CLE hours may be claimed per year for Nebraska.*

Ethics Essentials for Your Daily Practice (9:00 am)NE MCLE Activity #154171. IA MCLE Activity #289370. 1 CLE ethics hour. (Regular/live)

NE MCLE Activity #154172. IA MCLE Activity #289369. 1 CLE ethics hour. (Distance learning)

8:30 am Registration

9:00 am Ethics Essentials for Your Daily Practice John Steele, Nebraska Counsel for Discipline

This presentation will provide an overview of the Nebraska Counsel for Discipline and discuss the disciplinary process, the types of complaint filed, how the Counsel responds, how to avoid having a complaint file, and how to respond to a complaint if one is filed.

10:00 am 10 Strategies for Taking Witness Testimony in Depositions and Trials

Renee Eveland, Cline Williams Wright Johnson & Oldfather, Lincoln

11:00 am Break

11:15 am Criminal Law 101 Megan Lutz-Priefert, Anderson, Bressman Hoffman & Jacobs, P.C., L.L.O, Omaha

This presentation will provide you with how to evaluate your case and how to prepare for your first bench trial.

12:15 pm Lunch (boxed lunch provided)

12:45 pm Data Breaches – Legal and IT Responses Bruce Wray, Kutak Rock LLP, Omaha

This presentation will explore the parallels between IT and legal responses during a data breach scenario, with an emphasis on steps the legal practitioner should be taking during this crisis.

1:45 pm Do’s and Don’ts of Depositions Dru M. Moses and Courtney R. Ruwe, Law Office of Patrick J. Sodoro, Omaha

This presentation will provide the basics of depositions from the Insurance Defense perspective.

2:45 pm Break

3:00 pm Workers’ Compensation 101Dallas Jones, Baylor, Evnen, Curtiss, Grimit & Witt LLP, Lincoln

This presentation will discuss the Nebraska Workers’ Compensation Court and explain compensability (e.g., jurisdiction, employment relationships, compensable events, causation, defenses to compensability), benefits, penalties, subrogation, and settlement of a claim

4:00 pm Adjourn

Faculty Bios

John Steele is the Assistant Counsel for Discipline. Prior to joining the Nebraska Counsel for Discipline in 1993, he was in private practice with Schumacher & Achelpohl. John received his Juris Doctor from Creighton University School of Law.

Renee A. Eveland’s is an attorney with Cline Williams. Her trial experience is in the area of civil defense litigation, focused on insurance defense and professional liability (malpractice) defense, defending health care providers and other lawyers. She also litigates in the areas of premises liability, construction litigation, contract disputes and workers’ compensation. She has tried jury cases throughout the state of Nebraska and has argued before the Nebraska Court of Appeals and the Nebraska Supreme Court. She currently serves as the President of the Nebraska Defense Counsel Association.

Megan Lutz-Priefert is an attorney with Anderson, Bressman, Hoffman & Jacobs. She has been practicing criminal law since 2016. Prior to entering the practice she clerked for three years for a firm that practiced criminal law. In addition to criminal law she practices in the areas of family and juvenile law, plaintiff’s personal injury, business law, school law, and guardianships and adoptions.

Bruce Wray is an attorney at Kutak Rock LLP, working within the Intellectual Property and Information Technology practice group. He has a background in Information Security and Information Technology, having spent ten years working in the field and completing a Master’s in Computer Science, focused on Information Assurance. He currently assists clients with their Intellectual Property and Information Technology needs, including data breach responses.

Dru Moses is an attorney with the Law Office of Patrick J. Sodoro and focuses his practice on insurance defense litigation, small business representation, and estate planning. He earned his Juris Doctor from Creighton University School of Law. While at Creighton, he served as a Staff Editor for the Creighton Law Review. He received his Bachelor of Science in Health Administration and Policy from Creighton University. He is licensed to practice law in Nebraska, Iowa, Missouri and is a member of the Nebraska State Bar Association .

Courtney Ruwe is an attorney with the Law Office of Patrick J Sodoro and focuses her practice on family law, guardianships and conservatorships, insurance defense litigation, estate planning and appellate brief research and writing. She received her Bachelor of Arts from the University of Nebraska-Lincoln and earned her Juris Doctor from Creighton University School of Law. Prior to attending law school, Courtney worked for the government at both the State and Federal level.

Dallas Jones is Baylor Evnen's former Managing Partner and current Chair of the Workers' Compensation Practice Group. The focus of his practice is identifying innovative ways to enable employers to navigate the overlap of workers’ compensation claims and the myriad of employment laws that can create complications in the claims process. Mr. Jones received his Juris Doctor from the University of Nebraska College of Law.

Ethics Essentials for Your Daily Practice

John W. SteeleNebraska Counsel for Discipline


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ETHICS ESSENTIALS FOR YOUR DAILY PRACTICECreighton University School of Law

John W. SteeleAssistant Counsel for DisciplineMarch 9, 2018

The Disciplinary Process

FILING OF COMPLAINT

PRIVATE REPRIMAND

TRIALREFEREECOURT

APPOINTED

Rule 9(c) –Preliminary Inquiry

DISMISSAL ‐

NO APPEAL

Decline to Investigate

GRIEVANCE LETTER

FORMAL CHARGES

FORMAL GRIEVANCE

DISMISSAL

COUNSEL FOR DISCIPLINE FLOWCHART

NEBRASKA SUPREME COURT

AFTER INVESTIGATION –NO GROUNDS FOR

DISCIPLINE

APPEALDISCIPLINARY

REVIEW BOARD

COMMITTEE ON INQUIRY

UPGRADE

2

Formal

Summary Dismissal

9 (C)

Total

0

50

100

150

200

250

300

350

400

450

500

2011 2012 2013 2014 2015 2016 2017

10183 79 80

3643 30

131147

103 106122

220

155

179 164192

173 171 181

208

411 394374 359 329

489431

Total Number of Grievances

*Through 10/1/17

5%

9%

13%

12%

13%

48%

Grievances by Length of Practice of Attorney (years)

< 2

3‐5

6‐10

11‐15

16‐20

20+

10%

22%

2%

16%6%4%

12%

11%

3%1%

10%3%

Grievances by Area of Law

EstatePlanning/ProbateDomestic

General Civil

Criminal

Immigration

Not Client Related

Other Case Type

Personal Injury

Corporate/Commercial/BusinessRegulatory

Trust Account

Worker's Comp

3

12%

3%

21%

1%

8%2%1%1%3%7%

7%

3%

12%

6%

3%2%

7%3%

Characterization of GrievancesInterference with Justice

Misrepresentation/Fraud

Neglect

Unauthorized Practice

Conflict of Interest

Criminal Conduct

Discovery Abuse

Incompetence

Communication

Excessive Fees

Failure to Deliver Client File

Personal Conduct

Trust Violation

Other

Declining/TerminatingRepresentationConfidentiality

Failure to Pay Fee Dispute

Failure to Pay Third Party

27%

39%

8%

9%

7%

10%

Grievances by Disciplinary District

District 1

District 2

District 3

District 4

District 5

District 6

Nebraska Judicial Districts

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Year Private Reprimands

Public Reprimands

Suspensions Disbarments

2004 17 7 17 5

2005 13 5 7 8

2006 14 0 13 8

2007 16 0 13 5

2008 22 4 13 2

2009 11 2 12 8

2010 18 1 5 6

2011 5 3 3 5

2012 10 5 10 5

2013 7 5 8 5

2014 10 0 8 5

2015 4 2 4 7

2016 5 3 2 4

2017 6 3 8 1

4 Types of Matters Come out of C4D After My Initial Review1. MISCELLANEOUS – “RTI’S”

2. TRUST ACCOUNT VIOLATIONS

3. 9(C)’S; AND

4. FORMAL GRIEVANCES

Responding to a Disciplinary ComplaintThe importance of the respondent attorney’s response cannot be overstated

Considerations

1. BE HONEST!

2. Respond timely

3. Consider hiring an attorney

4. Be thorough to avoid follow‐ups

a) Answer all allegations

b) Be definitive

c) Do factual research before responding

5. Consider Restitution

6. Expression of insight

7. Be civil

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What not to do:1. Persuade someone not to file a grievance, or persuade the grievant into withdrawing the

grievance.

2. Sue or threaten to sue the grievant:

We conclude there was clear and convincing evidence that Wright violated § 3–508.4(d) by writing the letter… a plain reading of that letter indicates the letter was intended to do exactly what the Counsel for Discipline is alleging in this action—threatening to sue if the grievance was not withdrawn. Such is contrary to § 3–322(A), which states that reports of alleged misconduct are absolutely privileged and that no lawsuit may be predicated upon such reports. We therefore find that there is clear and convincing evidence of a violation of § 3–508.4(d). See, State ex rel Counsel for Discipline v. Wright, 277 Neb. 709 (2009).

3. A cover‐up is almost always worse than the alleged misconduct.

4. Don’t freeze or ignore it (you must cooperate or you will be suspended and more charges will come).

5. Lose sight of civility – Especially with my Office!!!

10 Ways to Avoid Meeting Bar Counsel

1. Return all calls from clients within 24 hours or leave a message telling them when you will.

2. Don’t ransom the file or money belonging to the client.

3. Never notarize a document unless the signing party is in front of you with ID.

4. “Watch out for the Dog”: It’s the case you hate, have been neglecting, and makes you sick when you think about it. Move it along or dump it – or it will come back to bite you!

5. Flood your client with paper/information so that she feels informed (See #1).

6. Get it in writing – fee agreements, notice of withdraws, fee payments from client accounts, engagement letters, disengagement letters, non‐engagement letters, (I don’t do dog bites, etc.), consents to conflict so of interest, and all settlement offers (especially those rejected against your advice).

10 Ways to Avoid Meeting Bar Counsel (Cont.)

7. Don’t go into business with your client. If you must, tread carefully, read all conflicts rules, and advise the client in writing to confer with outside counsel. Confer with outside counsel yourself.

8. Pay. Your. Court. Reporters. Don’t make me write you!

9. Keep a Secret. Keep your client’s business confidential – even if you think everyone knows it anyway. Don’t bad mouth the client to their new counsel.

10. Be nice. While an AMA study found no correlation between actual malpractice and the filing of lawsuits (Hey – it was an AMA study after all), it did find that doctors who had strong interpersonal skills and built good relationships with patients were much less likely to be sued…

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Fees1. Flat/Fixed Fee

A fixed charge for a particular representation, often paid in full at the beginning of the representation.

2. Advance Fee/Security RetainerA payment made at the beginning of a representation against which charges for the representation are credited as they accrue, usually on an hourly basis.

3. General RetainerPayment for an attorney’s availability, which is earned in full when paid before any work is done.

4. Contingency FeePayment for services rendered, with payment conditioned upon successful recovery by the attorney.

5. Hourly fee, paid after work is completed

“Regardless of the term used to describe a client’s initial payment, its type is determined by its purpose, i.e., what it is intended to purchase.” O’Farrell, 942 N.E.2d 799 (Ind. 2011).

The Special Case of Flat Fees(a) A flat fee, paid in exchange for a commitment by the lawyer to perform a specific task or set of tasks, may not be deposited into a lawyer’s client trust account if the client and lawyer have agreed that, upon receipt, it would become the property of the lawyer. Conversely, if an agreement for a flat fee provides that the lawyer has not earned the fee until the work is completed, any advance payment of the fee must be deposited in the lawyer’s trust account and may not be withdrawn until earned.

(b) A lawyer must have a clear agreement with a client as to the ownership of fees received by the lawyer so that the fees can be properly allocated between the lawyer’s trust account and operating account.

(c) A client must be notified that even a true flat fee that is treated as earned on receipt and deposited to the lawyer’s operating account might result in a refund if the agreed‐upon legal services are not completed by the lawyer.

ISBA Legal Ethics Committee Opinion No. 3 of 2015

The Forbidden “Non‐Refundable” Fee1. Unearned fees must always been refunded, period.

2. Cannot add boilerplate “non‐refundability” language to fee agreement. Doing so is a per se violation of Prof. Cond. R. 1.5(a).

3. Refundability and flat feesa) Don’t be confused by “earned upon receipt” language

for trust account purposes.b) Calculating amount of refund due.

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Disbursing Flat FeeTask basis: define tasks and how much money will be withdrawn.

Event basis: define events when portions of fee will be earned.

Hourly basis: hourly rate times hours.◦ Note that this does not affect determination of whether lawyer’s fee is reasonable.

Professional Conduct Rule 1.5(a)“A lawyer shall not make an agreement for, charge, or collect an unreasonable fee or unreasonable amount for expenses. The factors to be considered in determining the reasonableness of a fee include the following:◦ (1) the time and labor required, the novelty and difficulty of the questions involved, and the skill requisite to perform the legal service properly;

◦ (2) the likelihood, if apparent to the client, that the acceptance of the particular employment will preclude other employment by the lawyer;

◦ (3) the fee customarily charged in the locality for similar legal services;

◦ (4) the amount of time involved and the results obtained;

◦ (5) the time limitations imposed by the client or the circumstances;

◦ (6) the nature and length of the professional relationship with the client;

◦ (7) the experience, reputation, and ability of the lawyer or lawyers performing the services; and

◦ (8) whether the fee is fixed or contingent.”

Well, what’s unreasonable?1. Charging a nonrefundable fee. See State ex. Rel. Counsel for Discipline v. Wintroub, 277 Neb. 787 (2009).

2. Recycling old work product and rebilling subsequent clients for that same reused work. See ABA Formal Opinion 93‐379.

3. Billing your clients for time expended on preparing their bill (or defending its reasonableness). See Estate of Inlow, 735 N.E.2d 240 (Ind. 2000).

4. Charging lawyer rates for clerical work. See State ex. Rel. Counsel for Discipline v. Huston, 262 Neb. 481 (2001).

5. Charging for work done after you were fired due to Conflict of Interest. See State ex. Rel. Counsel for Discipline v. Shapiro, 266 Neb. 328 (2003).

6. Charging for work done to undo your prior mistakes. See Zirkle, 911 N.E.2d 572 (Ind. 2009) .

7. Charging former clients for the time you had to spend responding to their grievances. See Zirkle, supra.

8. Not performing work on client’s files but transferring funds from trust to operating account. State ex. Rel. Counsel for Discipline v. Thebarge, 289 Neb. 356 (2014).

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More unreasonable fees.9. Charging public defender clients for the representation. See Bass, 726 N.E.2d 1259 (Ind. 2000).

10. Charging client twice for work on one case – Fees deemed “excessive”. State ex. Rel. Counsel for Discipline v. Wright 277 Neb. 709 (2009).

11. Filing a lawsuit after settlement with insurer to increase fee from 25% to 33 & 1/3rd. State ex. Rel. Counsel for Discipline v. Miller, 258 Neb. 181 (1999).

12. Failing to reduce the amount of a contingency fee when collection of the fee under the original fee agreement gives the attorney an “unconscionable windfall.” Powell, 953 N.E.2d 1060 (Ind. 2011); see also Gerard, 634 N.E.2d 51 (Ind. 1994).

13. Taking the larger of a hourly versus contingent fee when your fee agreement is to the contrary. See Huston, supra.

14. Taking a contingency fee on funds promised in a settlement, but not actually received by your client. See Myers, 663 N.E.2d 771 (Ind. 1996).

15. Charging a fee greater than the presumptive limits established by statute or regulation. See Wright.

Other Fee Issues1. You must communicate the basis and rate of the fee either before the representation begins

or shortly thereafter. Prof. Cond. R. 1.5(b); see also Kray, 938 N.E.2d 218 (Ind. 2010).

2. All contingent fee agreements must be in writing. Prof. Cond. R. 1.5(c).a) Fee agreements should be clearly worded and avoid legalese so that the agreements are easily

understood by the client. See Lauter, 933 N.E.2d 1258 (Ind. 2010).

3. Renegotiation of the fee subject to Prof. Cond. R. 1.8(a).

Transitioning to a New Firm

Give Notice to Client Give Notice to Partners Agree on Notice/Advice re: Transition of Client File Notify NSBA/ASD/Supreme Court/All Courts Where

You Have Cases/Local Newspapers/Daily Record! Check For Conflicts if File Goes With You If a Conflict – Make Requests for Waivers Make Sure It Actually IS a Conflict:

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My Firm (“A”) and another Firm (“B”)have been fighting over the samelitigation for 15 years. I was neverinvolved in the litigation – I just doprobate. Can I go over to “B” whilethe litigation is still pending with “A”?

NEBRASKA ETHICS ADVISORY OPINION FOR LAWYERSNo. 15-01

QUESTION PRESENTED

I. Whether an attorney who transitions from a firm engaged on one side of a litigatedmatter (in which the attorney had no involvement) to a firm on the other side of the samematter disqualifies the attorney and firm from continuing to represent its client in suchmatter?

AN ATTORNEY WHO LEAVES A LAW FIRM THAT IS REPRESENTING A CLIENT IN AMATTER IS NOT PRECLUDED FROM JOINING ANOTHER LAW FIRM THAT ISREPRESENTING AN ADVERSE CLIENT IN THE SAME MATTER PROVIDED THAT THETRANSITIONING ATTORNEY OBTAINED NO CONFIDENTIAL KNOWLEDGE ORINFORMATION CONCERNING THE MATTER OR CLIENT PRIOR TO HIS OR HERDEPARTURE. THE TRANSITIONING ATTORNEY HAS THE BURDEN OF PROOF UPONINQUIRY OR COMPLAINT AS TO THE LACK OF KNOWLEDGE OR POSSESSION OFSUCH CONFIDENTIAL INFORMATION CONCERNING THE MATTER.

Establishing a Succession Plan – A True Story

Attorney had a successful ongoing practice.

Diagnosed with treatable (at first) cancer.

Continued to practice – cancer returned.

Attorney always thought until the end that he’s beat the cancer – he lost.

Spouse/Widow was attorney’s bookkeeper – unlike most, knew plenty.

Called me in tears 2 days after funeral not knowing what to do with the files.

Supreme Court appointed a Trustee.

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Succession Plans

Create a “Buddy System” with a colleague if alone

Ask office-sharing mates to cover for each other

Always have other attorneys within your Firm aware of your files so they could step in

Consider another signatory on the Trust Account

If seriously disabled, notify C4D so we can move for a Trustee while Rule 11 DisabilityInactive Application is pending

ABA Formal Opinion #92-369 & Sanctions

New Proposed Rule Change -§ 3-803. Membership.

(1)Each attorney who is a sole practitioner shall name an attorney(“Designated Attorney”) to protect the interests of the designatingattorney’s clients in the event the designating attorney dies, becomesdisabled, disappears, or abandons or otherwise temporarily or permanentlyceases the practice of law. The Designated Attorney may take whatever actionsmay be required or deemed appropriate under any such circumstance, including butnot limited to reviewing client files of the designating attorney, notifying thedesignating attorney’s clients of the situation, maintaining the designating attorney’spractice to the extent feasible or practicable, and/or proceeding with resolution orother disposition of the designating attorney’s client matters.

The New Attorney Is a Claim Frivolous?

See, § 3-501.16. Declining or terminating representation: (a) Except as stated in paragraph (c), a lawyer shall not represent a client

or, where representation has commenced, shall withdraw from the representation of a client if:(1) the representation will result in violation of the Rules of Professional

Conduct or other law; (b) Except as stated in paragraph (c), a lawyer may withdraw from

representing a client if:(1) withdrawal can be accomplished without material adverse effect on

the interests of the client;(2) the client persists in a course of action involving the lawyer's services

that the lawyer reasonably believes is criminal or fraudulent;

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The New Attorney Cont.§ 3-508.4. Misconduct:

It is professional misconduct for a lawyer to: (a) violate or attempt to violate the Rules of

Professional Conduct knowingly assist or induce another to do so or do so through the acts of another;

(b) commit a criminal act that reflects adversely on the lawyer's honesty, trustworthiness or fitness as a lawyer in other respects;

(c) engage in conduct involving dishonesty, fraud, deceit or misrepresentation;

Solo Practice and Office Sharing Issues –Protecting ConfidentialityCommon Issues: Sharing Office Space, Secretary, Receptionist, and Law Clerk Sharing a Computer Server Maintaining Paper Files and Computer Records Overhearing Phone/Meeting/Interoffice Conversations

Conflicts: Advisory Opinion 89-2 modified 75-13

Given that appropriate protective measures are in place office-sharing attorneys may take cases adverse to each other… Screen Receptionist & Secretary Protect Mail, Computer Docs, and Keep Files Separate Password Protect Docs on a Shared Server Keep Billing Secret Close Door for Phone/Office Conferences Don’t schedule meetings with clients at the same time! Only 1 of you use the clerk or neither of you uses the clerk… Need clients’ consent.

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Other Ethical ConcernsWhat is the “most least-well-known” ethical pitfall young

attorneys fall into? (Failing to ask Peers Questions)How can young attorneys use technology to prevent

committing ethical violations? (Use Our Website)What are the resources that young attorneys can take

advantage of to avoid ethical violations? (Call Me!) As a young and subordinate attorney, what do you do

when a partner tells you to do something that you find ethically inappropriate? (Notify another Partner/Call me)

§ 3-505.1. Responsibilities of a partner or supervisory lawyer.

(a) A partner in a law firm, and a lawyer who individually or together with other lawyers possesses comparable managerial authority in a law firm, shall make reasonable efforts to ensure that the firm has in effect measures giving reasonable assurance that all lawyers in the firm conform to the Rules of Professional Conduct.

(b) A lawyer having direct supervisory authority over another lawyer shall make reasonable efforts to ensure that the other lawyer conforms to the Rules of Professional Conduct.

(c) A lawyer shall be responsible for another lawyer's violation of the Rules of Professional Conduct if:

(1) the lawyer orders or, with knowledge of the specific conduct, ratifies the conduct involved; or

(2) the lawyer is a partner or has comparable managerial authority in the law firm in which the other lawyer practices, or has direct supervisory authority over the other lawyer, and knows of the conduct at a time when its consequences can be avoided or mitigated but fails to take reasonable remedial action.

A seasoned attorney working in private practice acceptsemployment with a corporation or governmentalagency. The proposed starting date for employment istwo weeks before the date a complicated case uponwhich she is lead counsel is set for trial.

Does the attorney have an ethical obligation to remainon the case through the completion of trial? If not, whatobligations does she have to help the client findalternative counsel? What further factors play into thisscenario based on whether the attorney is a solopractitioner or member of a small firm or a large firm?

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Ethically Withdrawing from a Case§ 3-501.16. Declining or terminating representation.

(b) Except as stated in paragraph (c), a lawyer may withdraw from representing a client if:

(1) withdrawal can be accomplished without material adverse effect on the interests of the client

*** (c) A lawyer must comply with applicable law requiring notice to or permission of a tribunal

when terminating a representation. When ordered to do so by a tribunal, a lawyer shall continue representation notwithstanding good cause for terminating the representation.

(d) Upon termination of representation, a lawyer shall take steps to the extent reasonably practicable to protect a client's interests, such as giving reasonable notice to the client, allowing time for employment of other counsel, surrendering papers and property to which the client is entitled and refunding any advance payment of fee or expense that has not been earned or incurred. The lawyer may retain papers relating to the client to the extent permitted by other law.

Trust Account Balance Upon Departure from Firm

If a lawyer leaves a firm and a client with a balance left in the firm’s trust account follows the lawyer, who is paid the balance?

How soon after the departure of the client must the firm account for and pay the client’s trust fund balance?

§ 3-501.5. Fees (f) Upon reasonable and timely request by the client, a lawyer shall provide, without charge, an accounting for fees and costs claimed or previously collected.

§ 3-501.15. Safekeeping property (c) A lawyer shall deposit into a client trust account legal fees and

expenses that have been paid in advance, to be withdrawn by thelawyer only as fees are earned or expenses incurred.

(d) Upon receiving funds or other property in which a client or thirdperson has an interest, a lawyer shall promptly notify the client or thirdperson. Except as stated in this rule or otherwise permitted by law or byagreement with the client, a lawyer shall promptly deliver to the client orthird person any funds or other property that the client or third person isentitled to receive and, upon request by the client or third person, shallpromptly render a full accounting regarding such property.

(e) When in the course of representation a lawyer is in possession ofproperty in which two or more persons (one of whom may be thelawyer) claim interests, the property shall be kept separate by thelawyer until the dispute is resolved. The lawyer shall promptly distributeall portions of the property as to which the interests are not in dispute.

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§ 3-501.15. Safekeeping property (Cont.)

See Comment [4] Paragraph (e) also recognizes that third parties may have lawful claims against specific funds or other property in a lawyer's custody, such as a client's creditor who has a lien on funds recovered in a personal injury action. A lawyer may have a duty under applicable law to protect such third-party claims against wrongful interference by the client. In such cases, when the third-party claim is not frivolous under applicable law, the lawyer must refuse to surrender the property to the client until the claims are resolved. A lawyer should not unilaterally assume to arbitrate a dispute between the client and the third party, but, when there are substantial grounds for dispute as to the person entitled to the funds, the lawyer may file an action to have a court resolve the dispute.

Opinion No. 12-09 - “Who Owns the Client Files?”

What are the lawyer’s ethical duties to release the client’s file when the law firmhas a written express consent for the firm to acquire a lien on the file to securethe lawyer’s fees or expenses?

“an attorney has an ethical obligation, upon demand, to promptly provide aclient with the contents of the file belonging to the client. What the clientmay be entitled to receive depends upon the nature of the work, theagreement between the attorney and client, and the particularcircumstances in the case. In circumstances where the clientscontinued representation would be in jeopardy, the lawyer's ethicalobligation to the client overrides any lien rights the lawyer may haveotherwise obtained by statute or agreement.

Proactive Management‐Based Regulation (PMBR)

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THE FUTURE OF REGULATION ‐ PMBR

Proactive Management Based Regulation

Education before Prosecution

Proactive – Involves the Attorney/Firm Investing in the Process – And Being Honest with Me

Atty/Firm Takes a “Self‐Assessment” Exam – What areas of Practice Need Support? Trust Accounting

Conflicts Checks

Calendaring/Backup

Practice/Office Management

Much Like Malpractice Insurance Underwriting

Attorneys/Firms who Have Malpractice Insurance are Exempt

IFF you take the Self‐Assessment and F/U with C4D/NSBA Assistance – YOU ARE EXEMPT FROM PROSECUTION!

PMBR ‐ CONTINUED Recent NLAP Evaluation by CoLap (Like C4D Audit in 2014)

Continue Work on Alco/Drug Dependency Issues (We were one of the First)

Explore Increasing Demand Re: Aging/Disability/Impairment/Diminished Capacity Issues

Increase C4D Discretion/Autonomy for Minor Offenses – 1st Offense DUI…

Create Programs for Referral to Diversion/Probation

Request Contract/Waiver of Confidentially so I know you were Successful – Or Not

Amnesty with C4D if Complete the Program or Discharged b/c No Issues

Prosecution ONLY if you Fail…

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PMBR Objectives – AMS (Appropriate Management Systems)

1.Negligence/Incompetence (providing for competent work practices)2.Communication (providing for effective, timely and courteous communication)

3.Delay (providing for timely review, delivery and follow‐up of legal services)

4.Liens/File Transfer (providing for timely resolution of document/file transfers)

5.Cost Disclosure/Billing Practices/Termination of Retainer (ensuring a shared understanding of retainer terms, appropriate documentation of the commencement and termination of retainers, and appropriate billing practices)

PMBR Objectives – AMS (Appropriate Management Systems) – Cont’d

6. Conflicts of Interest (providing for timely identification and resolution of conflicts, including when acting for multiple parties in a manner or proceeding against previous clients; anticipating potential conflicts arising from relationships with third parties)

7. Records Management (maintaining appropriate filing, archiving and document‐retention policies to minimize the risk of loss or destruction of correspondence and documents; ensuring that legal requirements for protecting client files, property, and financial interests are met)

8. Undertakings/Time Management (monitoring for timely compliance with notices, orders, rulings, directions, or other requirements of regulatory authorities, etc.)

9. Supervision of Practice & Staff (providing for compliance with statutory conditions concerning licensing, practice certification, employment of persons; providing quality standards for work outputs and the job performance of legal, paralegal, and non‐legal staff involved in the delivery of legal services)

10.Trust Account Regulations (including designation of “Responsible Attorney”, and providing for compliance with trust account procedures and using proper accounting principles)

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Illinois Implementation Issues1. Reaching Consensus with Members re: Fundamental Objectives

2. Create a Self‐Assessment Unique to the State

3. Each Firm Conducts a Self‐Assessment and Rates Itself

4. Each Firm Designates One (or More) Attorneys to Communicate with Regulatory Office

5. Regulatory Office Provides Resources to Assist

6. MCLE Credit if Offered in Exchange for Participation

7. Firms who Refuse to Participate may be Administratively Suspended, Pending Compliance

8. Data Collected in Self‐Assessments used for Training of Bar as a Whole

9. Regulatory Office may Direct a Self‐Assessment while an Investigation is Pending

10. Regulatory Office’s Mission Statement changes to Reflect the Change from Prosecution First to Education First

Illinois Implementation Issues – Cont’dGoal #1: Promote Firms/Solos to direct Attention to creating an environment fostering effective and professional services to clients and avoiding losses associated with Malpractice and Discipline

Goal #2: Structure Programs to divert lawyers involved in low‐level investigations to mentoring or law office management programs with NO ADMISSION OF MISCONDUCT!!!

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Illinois Implementation Issues – Cont’d

Challenges:

How is this really different that Rule 5.1 – Requiring Attorneys to insure all firm members follow the Rules?

What is this going to Cost?

Isn't this basically the same as applying for Malpractice Insurance and therefore shouldn't I be exempt?

What is the benefit to the Firm; Client; Regulators?

Does this give authority to Discipline Firms?

What other Benefits could The Court/Regulatory Office Offer to Participating Firms?

Is the Self‐Assessment Confidential, i.e., could it be required to be produced via Subpoena?

Could Firms who do Self‐Assessment use this as a Marketing Tool?

Could Firms retain a Third Party to Do the Self‐Assessment and then use this to Comply and Advertise?

19

The Disabled AttorneyA normally reliable attorney who practices in a law firmshows significant signs of stress and disorganization. Hedoesn’t open correspondence from his clients, opposingcounsel, and the courts. He habitually fails to meet court-imposed deadlines. At what point, if any, do the othermembers of his firm have an ethical obligation tointercede and protect the interests of his clients? Areother members of the firm subject to discipline if theyknew that the affected attorney was not providingeffective assistance of counsel, yet failed to act in theclient’s interests?

What should a multi-lawyer law firm do when it believes that one of its

attorneys is demonstrating the following potential disabilities?

• Mental incompetency or incapacity (e.g., forgetfulness, missed deadlines, inability to

organize thoughts and client work)

• Drug or alcohol abuse which is affecting client work

§ 3-508.3. Reporting professional misconduct

(a) A lawyer who knows that another lawyer has committed a violation of the Rules of Professional Conduct that raises a substantial question as to that lawyer's honesty, trustworthiness or fitness as a lawyer in other respects, shall inform the appropriate professional authority.

(b) A lawyer who knows that a judge has committed a violation of applicable rules of judicial conduct that raises a substantial question as to the judge's fitness for office shall inform the appropriate authority.

(c) This Rule does not require disclosure of information otherwise protected by Rule 1.6 or information gained by a lawyer or judge while participating in an approved lawyers assistance program.

20

§ 3-501.6. Confidentiality of information

(c) The relationship between a member of theNebraska State Bar Association Committee on theNebraska Lawyers Assistance Program (“NLAP”) oran employee of the Nebraska Lawyers AssistanceProgram and a lawyer who seeks or receivesassistance through that committee or that programshall be the same as that of lawyer and client forthe purposes of the application of Rule 1.6.

§ 3-311. Disability inactive status: Incompetency or incapacity.

Option - #1 My Office (a/k/a “The Hard Way”):(A) Upon a Grievance or other information indicating that a member is incapacitated from continuingthe practice of law by reason of physical or mental illness, or because of addiction to drugs orintoxicants, the appropriate Committee on Inquiry, with the assistance of the Counsel for Discipline,may prepare and submit to the Court an application requesting that the member be placed on disabilityinactive status. Such application shall be signed by the Chairperson of such Committee, and shall setforth grounds clearly indicating a temporary suspension of the member is necessary and proper.

***Option - #2 The Member (a/k/a “The Easy Way”):(C) A member who is incapacitated from continuing the practice of law by reason of physical or mentalillness, or because of addiction to drugs or intoxicants, may prepare and submit to the Court anapplication requesting that the member be placed on disability inactive status. Such application shall besigned by the member and shall set forth grounds clearly indicating that the member should be placedon disability inactive status. Upon the filing of such application by a member, the Court shall provide fornotice to the Counsel for Discipline. The member shall have the same rights of representation as setforth in § 3-311(B).

Trial Publicity

A lawyer who is participating or has participated in theinvestigation or litigation of a matter shall not make anextrajudicial statement that the lawyer knows orreasonably should know will be disseminated by means ofpublic communication and will have a substantiallikelihood of materially prejudicing an adjudicativeproceeding in the matter.– Rule § 3-503.6(a)

21

ModelRule3.6(c)

[A]lawyermaymakeastatementthatareasonablelawyerwouldbelieveisrequiredtoprotectaclientfromthesubstantialundueprejudicialeffectofrecentpublicitynotinitiatedbythelawyerorthelawyer'sclient.

ModelRule3.6(c),cont’d

Astatementmadepursuanttothisparagraphshallbelimitedtosuchinformationasisnecessarytomitigatetherecentadversepublicity.

Social Networking and Trial Publicity

A lawyer who is participating or has participated in the investigation or litigation of a matter shall not make an extrajudicial statement that the lawyer knows or reasonably should know will be disseminated by means of public communication and will have a substantial likelihood of materially prejudicing an adjudicative proceeding in the matter.– Rule § 3-503.6(a)

Social Networking is a publicly disseminated statement –per Florida Rule. (I believe Nebraska would concur)

22

Trial Publicity (cont.)

A lawyer may discuss the procedural posture of a pending case

A lawyer may not disseminate inflammatory information that is inadmissible

In re Morrissey, 996 F.Supp. 530 (E.D.Va. 1998). Criminal defense lawyer held in criminal contempt for making statements to news media about client's case in violation of local rule restricting statements about pending cases. The lawyer held a press conference in which he discussed recantation of witness testimony.

N.RP.C. § 3-501.9(c)(1)

What is meant by “generally known” in

(c) A lawyer who has formerly represented a client in a matter or whose present or former firm has formerly represented a client in a matter shall not thereafter:

(1) use information relating to the representation to the disadvantage of the former client except as these Rules would permit or require with respect to a client, or when the information has become generally known

65

ABA Formal Opinion 479

Information is not generally known simply because it is available in the public domain or a public file.

The information must be widely disseminated through media sources such as newspapers, websites, radio or social media. (and you better not be the source!)

66

23

THANKS!

10 Strategies for Taking Witness Testimony in Depositions and

Trials

Renee Eveland Cline Williams Wright Johnson & Oldfather

Lincoln, NE


1

1

10 STRATEGIES FOR TAKING WITNESS TESTIMONY AT DEPOSITIONS

AND AT TRIAL

JASON YUNGTUM/TARA STINGLEYRENEE A. EVELAND

2

LEARNING GOAL We will learn about strategically taking and eliciting

testimony whether during a deposition or during trial offriendly and adverse witnesses. Learn ten easy-to-remember pointers that can guide your strategy.

3

Strategy Number 1

IMPEACHMENT 101

& 201, 202, & 301…

(…you get the picture)

2

4

“Impeachment”

Impeachment (Defined)

Discrediting of a witness (Defined)

What are your case goals?E.g., Is this for a deposition? Is this for use at trial?

When to pin? What to pin? Why?

5

Eliciting Friendly Witness Testimony

CredibilityMotivesBackgroundWitness “tics” / presentation Consistency Knowledge / command of facts Courtroom presence

6

Examples:

3

7

Strategy Number 2

_____________ is magic. Answer:

8

Strategy Number 3

Be ready to __________Answer: Abandon your strategy (altogether).

9

Strategy Number 4

End on a _____________ note. Answer: High.

4

10

Strategy Number 5

Don’t be the __________ in the room.

11

Answer:

“Most Upset Person in the Room.”

12

Strategy Number 6

Never let ‘em see you _______________.

5

Remember: “Sweating” can look like a lot of different things, tics, gives, tells. Jurors are watching.

15

Strategy Number 7

Cover the Basic-Answer: Cover the

basic-of-basics

6

16

Strategy Number 8

Enough’s ______Answer: Enough…

(know when to stop)

17

Strategy Number 9

…Or did you need more?

18

Strategy Number 9, continued

7

19

Strategy Number 9, continued Momsen v. Nebraska Methodist Hosp., 210 Neb. 45, 313 N.W.2d 208 (1981):

Estate PR brings medical malpractice action against physician to recover damages for death of patient. Judgment (jury trial) in favor of physician. PR moves for new trial, granted. Physician appeals from order granting new trial. [Other appeals, cross-appeals, defendants, irrelevant and omitted.]

Supreme Court held: (1) where physician, without reasonable explanation, changed his testimony concerning material facts on a vital issue from testimony given in deposition, such change clearly being made to meet exigencies of pending litigation when testifying at trial, jury was to be told that his testimony was discredited as a matter of law and would be disregarded, and (2) physician, who had knowledge of patient's symptoms and their serious nature, was therefore negligent in not going to hospital immediately to make a personal examination and attempt further diagnosis of patient.

Remand Instructions: Re-try the case.

20

Strategy Number 10

Take the time to learn your craft.

Be great at what you do!

21

Questions?Renee A. Eveland

[email protected] (direct)

Criminal Law 101 Megan Lutz-Priefert

Anderson, Bressman, Hoffman & Jacobs, PC,

LLO Omaha, NE


1

How to navigate criminal law, when you don’t know what you are doing

By: Megan Lutz‐Priefert of Anderson, Bressman, Hoffman and Jacobs

Omaha City Ordinance $500 or 6 months

Anderson, Bressman, Hoffman & Jacobs

Misdemeanor Class I – max not more than 1 year or $1,000 fine

Class II – max 6 months or $1,000 fine

Class III – max 3 months or $500 fine

Class IIIA – max 7 days or $500 fine

Class IV ‐ $500 fine

Class V ‐ $100 fine


2

Felony Class I – Death

Class IA – Life

Class IB‐max life; minimum 20 years

Class IC – max 50 years; minimum 5 years

Class ID – max 50 years; minimum 3 years

Class II – max 50 years; minimum 1 year

Class IIA – max 20 years; minimum none


Felony Continued Class III– maximum 4 years and 2 year post‐release supervision or $25,000; minimum none but if prison 9 months post‐release

Class IIIA – maximum 3 years and 18 months post‐release supervision or $10,000; minimum none but if prison 9 months post‐release

Class IV– maximum 2 years and 12 months post‐release supervision or $10,000; minimum none but if prison 9 months post‐release


Complaints All Complaints, regardless of format will tell you what your client is charged with


3


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4






5

Warrant Occurrence

Failure to Appear

Crime Occurred but not Arrested

Walk it In

Notice Required in Douglas County

Notice Polite but not required in Sarpy County




6

Bond Set based on crime

There is no “bond school”

There is no statutory scheme

Based on crime


Bond con’t Get to know client

Kids/family

Length of time in community

Education

Flight risk

Job/School

Anything else that let’s Judge know who your client is



7

Discovery Requests Vary from office to office

Sarpy – email a stipulation over and they will provide discovery

Douglas – email asking for discovery and can pick it up

Omaha – fill out form at the Clerk’s Office


Pretrial Motions Motion in Limine – ask judge to not allow certain evidence to appear at trial

Motion to Suppress – evidence obtained by illegal search and seizure (most often)

Bond Review

Motion to Dismiss

Motion to Compel

Motion to Release certain evidence


Evaluate Your Case Wait until you have all discovery

Discuss with client the case

Research the case – one word can make a difference

Know how a case should be handled


8

Sample Violation of Protection Order Summary of Case using social media

“Communication with”

Witness said evidence was deleted – after client was arrested

Witness did not do a “cellbrite pull”

Witness had not subpoenaed Instagram



Questions Megan Lutz‐Priefert

Mlutz‐[email protected]

402‐333‐4774 ext 111


Data Breaches – Legal and IT

Responses

Bruce Wray

Kutak Rock, LLP

Omaha, NE

March 9, 2018

Creighton University School of Law, Omaha, NE

1

1

Data BreachesLegal and IT

Responses

Bruce WrayKutak Rock – Omaha

22

Introduction to Data Breaches

IT Response:

• Identify

• Contain

• Eradicate

• Recover

• Debrief

Legal Response:

• Identify Internal/External Teams

• End Incident

• Engage Outside Resources (forensics, law enforcement, insurance)

• Assess Exposure

• Update Logs

• Analyze Incident

• Issue Breach Notifications

3

Legal Response

2

44

Identify Internal/External Teams

Who:

• Internal managers and possibly executives

• Required IT resources

• External legal counsel

Start Considering?

• Law enforcement

• Insurance

• Call Center

Why:

• Smaller, surgical team to debrief and manage incident

• Executive authority to engage and make decisions

• Internal and/or external legal team to assess exposure

55

End Incident

• Relying upon IT resources

• Collection of data and evidence for legal and law enforcement

• Forensic evidence

• Determine scope:

• Whose data was lost?• Type of data?• Content of data?• Who holds the data?• State of origin of data?

66

Engage Outside Resources

These may include:

• Forensics teams

• Law enforcement

• Insurance

• Call Center

Insurance notes:

• Promptly notify and follow notification requirements in policy

• Provider may restrict who and when others can be engaged

3

77

Assess Exposure

Tied to outcome of IT resources work

• Which accounts, software, networks, servers, and/or physical space was exposed?

• What states were affected individuals from?

• Was any Personally Identifiable Information* (PII) exposed?

88

Assess Exposure – Why By State?

Goal – Determine if there was a breach that requires notification

Why ask what states were affected individuals from:

• Some notifications and definitions are federal, meaning there is one set of definitions, requirements, and notifications across the country

• States, however, also have varying statutes, with different definitions and notifications

99

Assess Exposure – Why By State?


State by State to Determine:

• Which statutes need to be examined

• What definition of Personally Identifiable Information governs

• What definition of Breach governs

• What notifications are required

4

1010

Assess Exposure – What is PII?


General Definition

• Personally identifiable information (PII), or sensitive personal information (SPI), as used in information security and privacy laws, is information that can be used on its own or with other information to identify, contact, or locate a single person, or to identify an individual in context. (source: Wikipedia)

1111



Alaska’s Definition of PII:

(7) "personal information" means information in any form on an individual that is not encrypted or redacted, or is encrypted and the encryption key has been accessed or acquired, and that consists of a combination of

• (A) an individual's name; in this subparagraph, "individual's name" means a combination of an individual's

• (i) first name or first initial; and• (ii) last name; and

• (B) one or more of the following information elements:• (i) the individual's social security number;• (ii) the individual's driver's license number or state identification card number;• (iii) except as provided in (iv) of this subparagraph, the individual's account number, credit card number, or debit card number;• (iv) if an account can only be accessed with a personal code, the number in (iii) of this subparagraph and the personal code; in this sub‐

subparagraph, "personal code" means a security code, an access code, a personal identification number, or a password;• (v) passwords, personal identification numbers, or other access codes for financial accounts.

Sec. 45.48.090. Definitions.

1212



Alaska’s Definition of Breach:

(1) "breach of the security" means unauthorized acquisition, or reasonable belief of unauthorized acquisition, of personal information that compromises the security, confidentiality, or integrity of the personal information maintained by the information collector; in this paragraph, "acquisition" includes acquisition by

(A) photocopying, facsimile, or other paper‐based method;

(B) a device, including a computer, that can read, write, or store information that is represented in numerical form; or

(C) a method not identified by (A) or (B) of this paragraph;

Sec. 45.48.090. Definitions.

5

1313



Nebraska’s Definition of PII:

(5) Personal information means either of the following:

• (a) A Nebraska resident's first name or first initial and last name in combination with any one or more of the following data elements that relate to the resident if either the name or the data elements are not encrypted, redacted, or otherwise altered by any method or technology in such a manner that the name or data elements are unreadable:

• (i) Social security number;

• (ii) Motor vehicle operator's license number or state identification card number;

• (iii) Account number or credit or debit card number, in combination with any required security code, access code, or password that would permit access to a resident's financial account;

• (iv) Unique electronic identification number or routing code, in combination with any required security code, access code, or password; or

• (v) Unique biometric data, such as a fingerprint, voice print, or retina or iris image, or other unique physical representation; or

• (b) A user name or email address, in combination with a password or security question and answer, that would permit access to anonline account.

Personal information does not include publicly available information that is lawfully made available to the general public from federal, state, or local government records

Nebraska Revised Statute 87‐802

1414



Nebraska’s Definition of Breach:

(1) Breach of the security of the system means the unauthorized acquisition of unencrypted computerized data that compromises the security, confidentiality, or integrity of personal information maintained by an individual or a commercial entity. Good faith acquisition of personal information by an employee or agent of an individual or a commercial entity for the purposes of the individual or the commercial entity is not a breach of the security of the system if the personal information is not used or subject to further unauthorized disclosure. Acquisition of personal information pursuant to a search warrant, subpoena, or other court order or pursuant to a subpoena or order of a state agency is not a breach of the security of the system;

Nebraska Revised Statute 87‐802

1515

Assess Exposure – Not just PII?


This analysis does not begin or end with PII, under it’s varying definitions

• Some states have solo statues targeted at Social Security Numbers, drivers IDs

• HIPAA, PCI, etc.

6

1616

Assess Exposure – Not just PII?


HIPAA governs:

• Personal Health Information

• Varying degrees of “anonymization” allowed

• Example – age plus zip may individually identify

PCI governs:

• Card and Cardholder Data

1717

Update Logs

Two types:

• Physical Logs and Electronic Logs leading up to and including incident

• Response Logs maintained throughout the process• Excel Spreadsheet with tasks, timelines, and signoffs• May require adjustment throughout process

1818

Analyze Incident


Steps:

• Was there a “breach” as defined by applicable statute?

• Are the notifications requirements triggered?

• Who must be notified – individuals, attorney(s) general, governmental agencies?

• Deadlines for notification letters?

7

1919

Issue Breach Notifications


We have to notify, now what?

• What are requirements of notification, and to whom?

• Will we engage a Call Center to assist and which one?

• Are there other services we want to offer those affected?

• Credit Monitoring• Fraud Protection

20

Other Breach Issues

2121

Other Breach Issues – Vendor Breach vs Internal Breach

• Vendor Breach

• Contract Terms Often Govern• Do they notify you? • What do they share? • How do they share? • When do they share?

• Internal Breach

• All response responsibility lies with you

8

2222

Other Breach Issues – Insurance

Insurance:

• Can be expensive, but defrays costs during incident• May dictate approved providers and available steps• May not match legal requirements

• i.e. you may be legally obligated to do more than they are contractually obligated to pay for

23

Thank you.

Bruce Wray, Associate AttorneyIntellectual Property & Information Technology Practice Group Kutak Rock – [email protected](402) 346-6000

Do’s and Don’ts of Depositions

Dru M. Moses Courtney R. Ruwe

Law Office of Patrick J. Sodoro

Omaha, NE


1

Do’s and Don’ts of Depositions

Tips for Young Lawyers

Some guidelines- Just ideas!

If you like them take them, if you don’t throw them back.

Do Not Write Out Questions

Do not write out questions word for word and read them off- it is dangerous.

Relax and have a conversation.

Use a few words to evoke questions: Examples:

○ Address - social security number – specifics surrounding the injury – what he/she was doing at time of the accident – why was he/she located where they were located – who did Plaintiff talk to about the accident – etc.

Word for word ties you down. You don’t want to be a robot!

2

Know the Facts

Prepare more than the other attorney.

Know the case better.

The facts will set you free.

Don’t over complicate things.

Arrive Early and Stay Late

Get there early and get comfortable.

Don’t be rushed by opposing counsel, if necessary take a break and tell them to “knock it off”, or don’t take a break and tell them to “knock it off”.

You have the same license to practice law that they do.

You know more about the law than they do.

Deal with Objections

Don’t overreact to objection- “you can answer.”

Don’t debate opposing counsel on the record.

If you ask a question opposing counsel says is out of bounds and instructs deponent not to answer: Ask them to clarify their objection.

Modify the Question.

Ignore and press on.

3

Give Deponent the speech

No uh-ah’s or uh-uh’s.

Can I call you by your first name?

Breaks.

Explain what the Court Reporter is doing and why.

Not trying to trick you.

Thank them.

Usual Stipulations

Court Reporter – “Usual Stipulations.”

No judicial definition of what this means.

Typically understood to mean “reserving all objections” or “reserving all objections except as to form and foundation”.

Ask: What do you mean by usual stipulation?

Assignments Prior to Deposition

Identify what you want to accomplish.

Allow the outline to guide you and not be your script.

Be clear in questioning.

Keep reading the minimum.

Don’t get mad.

4

Outline that has passed the test of time… Can be useful as a back up to your specific

preparation.

Go through it line by line before adjourning.

Take your time- do not let someone rush you because they have some grey hair!

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Workers Compensation 101

Dallas Jones Baylor, Evnen, Curtiss, Grimit & Witt, LLP

Lincoln, NE


1

WORKERS’COMPENSATION101

ABAYLOREVNENPRESENTATION

Dallas D. Jones, Esq.Baylor Evnen Curtiss Grimit & Witt, LLP

Wells Fargo Center 1248 “O” Street, Suite 600

Lincoln, NE 68508(402) 475-1075

[email protected]

www.BaylorEvnen.com

The Basics of The System• A “No Fault” System

–Negligence of the employee and employer irrelevant

• But Limited Damages–Limited Compensation–Reimburse medical expenses

• No pain and suffering

The Basics of the System

• What is Compensable?– Injuries from “Accidents”

• Traditional “accidents”

• “Cumulative Trauma”

– Occupational Diseases• Unique to that occupation

– Aggravations of Pre-existing Conditions

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• The Four types of Benefits– Medical benefits– Temporary indemnity benefits– Permanent indemnity benefits – Vocational rehabilitation

The Basics of the System

EMPLOYMENT RELATIONSHIP

• There must be a contract of hire, either express or implied

• Requires an employer and employee

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WHO IS AN EMPLOYER?

• Traditional Employers– Government (not Federal)

– Private• One or more employees

• Agricultural Employers– Act applies if have 10 or more unrelated EEs

– Must give notice if fewer than 10 EEs or will be subject to Act

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WHO IS AN EMPLOYER?

• Statutory Employers– One who contracts with uninsured employer,

and

– Does not obtain proof that contractor has WC coverage

– Is liable for the benefits of contractor’s injured employee

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WHO IS AN EMPLOYEE?

• Traditional Employees

• Executive Officers– Must elect (Opt in)

• Self-employed persons• Must elect (Opt in)

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WHO IS AN EMPLOYEE?

• Loaned employees– Joint liability for employers

• Independent Contractors are not covered– 10 factors

– Control is most important

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WHO IS AN EMPLOYEE?

• Volunteers– Generally not covered

– But what is a volunteer?• Was there a contract, express or implied?

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WHO IS AN EMPLOYEE?

• Undocumented aliens– Are “employees” for purposes of workers’

compensation benefits• But are not entitled to vocational rehabilitation if

could have been placed with an employer but for his illegal status

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• Accidents• Occupational Diseases

COMPENSABLE EVENTS

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• Unexpected or unforeseen injury which occurs suddenly and violently, producing at the time objective symptoms of an injury.• Traditional Accidents

• Slips, trips, falls, etc.

• Repetitive/Cumulative Trauma• Gradual, insidious onset over time

ACCIDENT

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ACCIDENT

• Repetitive/Cumulative Trauma– The Issue:

• “Suddenly and violently”– Must occur at an identifiable point in time requiring the

employee to discontinue employment and seek medical treatment.

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ACCIDENT• Discontinue Employment

– Missed time from work—any amount is enough

– Working fewer hours?

– Alternative duty?

• Seek Medical Treatment– Any treatment is enough

– But what about “in-house” nurse?

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• Disease which are due to causes and conditions which are characteristic of and peculiar to a particular trade, occupation, process, or employment and

• Excludes all ordinary diseases of life to which the general public is exposed

OCCUPATIONAL DISEASES

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• “Characteristic of and Peculiar to” – Due to causes and conditions unique to

certain jobs• Examples:

– Lung diseases unique to grain dust

– Asbestosis, certain lung cancers and mesothelioma caused by asbestos exposure


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• Ordinary diseases of life– No statutory definition nor case law

guidance

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• Last Injurious Exposure Rule– Determines identity of liable defendant

– Injurious• “of the type that could cause the disease given

prolonged exposure.”

• Need not be proved to have been a material contributing cause of the disease

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• Date of Disability– Fixes AWW; accrual of Statute of Limitations

– When the disease results in diminution of employability or impairment of earning capacity

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• Cardiovascular Injuries– Strokes and Heart Attacks

• Legal Test– Work-related stress or exertion greater than that in non-

employment life of employee or any other person

• Medical Test– Employment contributed in material and substantial

degree to cause injury

SPECIAL RULES FOR CERTAIN INJURIES

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MENTAL INJURIES• Caused by or secondary to violence to the physical

structure of the body– “Physical-mental”, not “Mental-mental”

• Unless:

– First Responders or Frontline Employees exposed to stimuli that is:

• “Extraordinary and unusual” in comparison to normal conditions of their employment

• Not incidental to normal employee/employer relations

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“ARISING OUT OF” and “IN THE COURSE OF”

• Arising out of– Employment related risk gave rise to injury

• Risk may be minimal, e.g., bump in carpet, slight defect in floor

• But “everyday activities” such as bearing one’s weight while walking, or rising from a chair, or stepping out of a car, is not enough

• In the Course of– Time, place and circumstances of accident

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ARISING OUT OF AND IN THE COURSE OF—SPECIAL

RULES• Going to and Coming from Rule

– Not compensable, except:• Commercial traveler/dual purpose

• Personal comfort and convenience

• Special errand

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ARISING OUT OF AND IN THE COURS OF—SPECIAL RULES• More exceptions to Going to and Coming

from:– Employer supplied transportation

– Employer owned/controlled parking lot, strip mall common area, public lot where employee directed to park

– Public property between place directed to park and work

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CAUSATION

• Objective injuries– No expert testimony required

• Subjective injuries– Expert testimony required

• Definite and certain– “Maybe”, “could be”, “possibly”, “consistent with” are

insufficient

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CAUSATION

• Aggravations of pre-existing conditions are compensable, including the effects of the pre-existing condition

• Natural progression of a pre-existing condition is not compensable

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CAUSATION• A few suggestions . . .

– Aim higher than legal sufficiency• The art of persuasion

– You will lose without the opinion

– You may not win without the explanation

» Why, why, why

• Understand anatomy

• Understand the medicine

• Understand science

©2017 Baylor Evnen

NOTICE

• As soon as practicable after the happening thereof– Late notice precludes compensability

– No bright line test• 4 months too long

– Written notice not required

– Employer’s burden to inquire

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AFFIRMATIVE DEFENSES

• Statute of Limitations

• 2 years from the accident or occupational disease, or last payment

• Exceptions:– Material and substantial increase in incapacity

– Latent and progressive

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• Willful negligence– Reckless indifference to safety

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• Violation of Safety Rule– Employer has reasonable rule designed to

protect employees– Employee has actual notice of rule

– Employee understands danger of violation

– Employer enforces rule

– Employee has no bona fide excuse

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• Intoxication– Intoxication caused accident and injury

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• Non-cooperation with medical treatment– Must prove non-cooperation prevented

improvement, or made condition worse• Requires expert opinion as to what would have

happened but for non-cooperation– Practically very difficult to obtain

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• Apportionment – BAW injury

– Prior injury produced disability up to time of accident

– Prior injury produced disability after accident

– Employee compensated for prior disability

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AVERAGE WEEKLY WAGE

• Basis for all indemnity benefits– Usually based upon previous 26 weeks

• Tips normally included

• Bonuses normally included

• Overtime hours, not dollars, included

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AVERAGE WEEKLY WAGE

• Miscellaneous items not included unless value fixed by parties at time of hire

• E.g., food, housing, insurance

• Abnormally low weeks excluded

• Abnormally high weeks included

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TEMPORARY DISABILITY BENEFITS

• Temporary total disability (TTD)– Weekly rate = 2/3rds of AWW

• Subject to maximum rate– Changes annually

» No COLA

• Temporary partial disability– The old--2/3rds of loss wages due to injury

– The new--LOEC?

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PERMANENT DISABILITY BENEFITS

• Schedule Member Injuries

• Body as a Whole Injuries– Anything not on the schedule

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SCHEDULE MEMBER INJURIES

• Level of disability is nearly always function of medical impairment

• Schedule provides number of weeks to be paid– Rate = 2/3 x AWW

• Rate x % impairment x number weeks per schedule

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SCHEDULE MEMBER INJURIES

• Exceptions:– Two members in one accident

• PTD if total loss of use of both members

• 30% Rule– Two members injured in one accident

» Different extremities or same?

– Court has discretion to appoint counselor to assess LOEC

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BODY AS A WHOLE INJURIES

• Based upon loss of earning capacity– Rate = 2/3 x AWW x LOEC

• Rate x 300 weeks, less # weeks of TD paid

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LOSS OF EARNING CAPACITY

• No formula– Function of loss of access to labor market and

ability to earn wages

– Not synonymous with impairment

• Assessed by counselors, but judges may assess without counselor– Rebuttable presumption of correctness

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“STACKING”

• BAW and Schedule member injuries in one accident– Compensation based upon LOEC if LOEC

cannot reasonably be calculated without consideration of affects of scheduled injuries

• No separate recovery of scheduled injuries per schedule

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DEATH BENEFITS

• $10,000 funeral expenses

• Widow or widower entitled to 2/3rds AWW until death or remarriage– 2 year lump sum payment upon remarriage

• Children, step children entitled to benefits until 19, but if in school, until 25

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MEDICAL BENEFITS• Choice of physician

– Employee chooses if:• s/he or immediate family member have treated

with a physician

• Or if employer does not provide Form 50 after the accident

• No change of physician unless:– Agreement or order

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MEDICAL BENEFITS

• Unlimited

• Reasonable treatment

• Necessitated by injury

• Fee Schedule sets reimbursement rate– Hospitals, Medical Services (doctors, PTs,

etc.) and Implantable Devices

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MEDICAL BENEFITS

• Managed Care– Reimbursement per Agreement

– Referrals must be into Plan

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VOCATIONAL REHABILITATION

• Goal is to return to suitable employment– Suitable employment = similar pay and

compatible with employee’s age, education, experience, aptitude

• Formal School, OJT, ESL, job placement

• TD during plan

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VOCATIONAL REHABILITATION

• Counselor agreed upon by parties, or if no agreement selected by Court

• Administered by VR division of Court

• Counselor Fees paid by Employer/carrier

• Tuition, books, mileage, fees paid by Fund

• Counselor must prepare plan

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OTHER “BENEFITS”

• Waiting Time Penalties

• Attorneys Fees

• Costs

• Interest

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WAITING TIME PENALTIES

– 50% of any indemnity benefit more than 30 days overdue, for which there is no reasonable controversy as to compensability

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ATTORNEYS FEES

• When a penalty is assessed

• When a medical benefit is more than 30 days overdue, and there is no reasonable controversy

• Unsuccessful employer appeal

• Successful employee appeal

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COSTS

• Awarded if an attorney’s fee is awarded– Costs of depositions admitted into evidence,

witness fees and mileage to attend hearing

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INTEREST

• Awarded if an attorney’s fee is awarded– Injuries prior to 8/30/15

• 14% interest

– Injuries 8/30/15 or later• 6% above bond investment yield as published by

Secretary of Treasury

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SUBROGATION• When employee recovers from liable third

party, and employer has paid benefits

• “Fair and equitable distribution” if not agreement– No formula

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SUBROGATION

• Fair and Equitable Distribution– Factors which may NOT be considered:

• “Made Whole” Doctrine

• Equitable Defenses

• Comparative Risk of Parties

• Collection of Premiums

• Participation in Third-Party Claim

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SETTLEMENT

• Lump Sum Settlements approved by the Court:– Entire claim, or

– Partial settlements; e.g., leaving future medical open

• Releases

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LUMP SUM SETTLEMENTS APPROVED BY THE COURT

• Must be used if:– Pro se claimant

– Medicare has interest

– Medicaid not reimbursed

• Settlement application is very detailed, takes time for approval

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PARTIAL SETTLEMENT APPROVED BY THE COURT

• Process identical to LSS

• But are bringing finality to only limited issues

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RELEASES

• Employee must be represented

• Medicare cannot be an issue

• Medicaid must be repaid

• Must be in “conformity with the Act”

• Fast

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THE COURT• 7 judges

• HQ in Lincoln– 1010 Lincoln Mall, Suite 101

• Venue– In county of Ax

• Video and teleconferencing of evidentiary hearings via stipulation

– In Lincoln if out of state Ax

©2017 Baylor Evnen

Developing the Employee’s Case

• Trust but verify

• Get every single medical record so that:– You know about the “warts”

– And can deal with the “warts”

• Send discovery

• Fully answer discovery

• Develop a “theme” as early as possible

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Developing the Employee’s Case

• Develop air-tight causation evidence– Consistent with mechanism of injury

– Well-explained

– Counter the defense theory

• Depose the defendant’s witnesses

• Work harder than the other guy

• Set up penalties

Developing the Employer’s Defense

• Time is short

• Secure every medical record, before and after the accident

• Talk to the employer representatives and witness and go to the accident site– Does the claim make sense?


• Scrutinize every element of the plaintiff’s burden of proof– Especially causation

• Undermine expert assumptions

• Remember ex parte rights

• Develop a “theme” as early as possible

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• Admit what you must– Bad defenses diminish good ones

• Make your desired result the path of least resistance

• Depose the plaintiff early

• Work harder than the other attorney

TRIAL TIPS AND TACTICS• From the plaintiff’s perspective:

– Know the judge

– Make an opening• Tell a story

– Make sure you have evidence to prove every element of burden of proof

• Pay special attention to “causation”

– Know what you want, and why you should get it

©2017 Baylor Evnen

TRIAL TIPS AND TACTICS

• From the plaintiff’s perspective:– Know why you’re offering what you’re offering

– Summarize the medical bills• Make it easy to award them

– Lead the plaintiff through the unimportant stuff• Grind through the good stuff

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TRIAL TIPS AND TACTICS• From the defendant’s perspective

– Know the judge• Make an opening

– Tell a story

– Make your cross meaningful• Use admissions from the deposition

• Assess Challenge causation

– Know why you’re offering what you’re offering

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APPEALS

• Standard of Review:– Court acted without or in excess of power

– Decision procured by fraud

– Not sufficient competent evidence in record

– Findings of Fact do not Support decision• Not clearly wrong

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Dallas’ Top Ten Rules

• 1. The Workers’ Compensation Bar is SMALL.

• 2. Judges, lawyers and doctors have long memories.

• 3. What goes around comes around.

• 4. An average lawyer with character and integrity can have a great career. A great lawyer without it will have a short one.

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• 5. Fight about what matters.

• 6. What a dumb argument does to a strong one is the same as what a rotten apple does to a fresh one.

• 7. Put down the keyboard and pick up the phone.


• 8. Being an asshole does not make you a zealous advocate, it just makes you an asshole.

• 9. Do the right thing.

• 10. As a cure for worrying, HARD WORK is better than whiskey. (Thomas Edison)

THE END

Questions?

©2017 Baylor Evnen

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WORKERS’ COMPENSATION 101 By:

Dallas D. Jones

WELLS FARGO CENTER

1248 “O” STREET, SUITE 600

LINCOLN, NEBRASKA 68508

PHONE: 402.475.1075

[email protected] www.BaylorEvnen.com

I. NEBRASKA WORKERS’ COMPENSATION COURT

A. Court

The Nebraska Workers' Compensation Court is composed of seven judges who are

initially appointed by the governor and who then remain on the bench for successive

six-year terms upon approval of the electorate.

B. Headquarters

Four judges maintain offices at the Nebraska Workers’ Compensation Court in

Lincoln and three judges maintain offices in the Hall of Justice in Omaha.

C. Trials

1. Venue

Matters are to be heard in the county where the accident occurred. REV. STAT.

§48-177. In cases where the injury occurred outside the state, the hearing will be

held in Lincoln, Nebraska. NEB. REV. STAT. §48-186. Parties may stipulate to

change venue to a different county. All nonevidentiary hearings may be heard

telephonically or by video conferencing. And if the parties stipulate and the court

agrees, evidentiary hearings may also be heard telephonically or by video

conferencing. NEB. REV. STAT § 48-177.

mailto:[email protected]

http://www.baylorevnen.com/

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2. Rule of Evidence

As a general rule, the Nebraska Workers' Compensation Court is not bound by the

usual common-law or statutory rules of evidence. Neb.Rev.Stat. §§ 48-168(1) and

27-1101(4)(d); Sheridan v. Catering Mgmt., Inc., 252 Neb. 825, 566 N.W.2d 110

(1997).

D. Appeals

Any party may appeal the trial judge’s decision directly to the Nebraska Court of

Appeals or attempt to bypass the Court of Appeals to the Supreme Court. The

standard of review provides that a judgment, order, or award of the Workers'

Compensation Court may be modified, reversed, or set aside only upon the grounds

that (1) the compensation court acted without or in excess of its powers; (2) the

judgment, order, or award was procured by fraud; (3) there is not sufficient

competent evidence in the record to warrant the making of the order, judgment, or

award; or (4) the findings of fact by the compensation court do not support the order

or award.

E. Office of the Clerk of the Court

It receives court filings, dockets cases, schedules hearings and motions, corresponds

with the parties, issues opinions of the court, and provides administrative and

secretarial support for the judges of the court.

II. COMPENSABILITY

A. Nebraska Jurisdiction

Per Neb. Rev. Stat. 48-115, the following four possibilities which confer

jurisdiction to the Nebraska Workers’ Compensation Court are:

1. The contract of hire was entered into in the State of Nebraska.

2. The Accident occurred in or the Occupational Disease was contracted

in Nebraska;

3. Employer doing Business in Nebraska;

The employer does business in Nebraska. The employer does not need to

be resident employer. The full extent of the relationship between the

injured individual’s accident and/or employment and the state of Nebraska

is probably still a bit uncertain.

4. Principal Place of Business in Nebraska

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The employer’s principal place of business is in Nebraska.

B. Employment Relationship

1. There must be an employer.

a) Traditional Employers

The definition of “employer” for workers’ compensation purposes

includes: (1) The state and every governmental agency created by

it, or (2) every person, firm or corporation who is engaged in any

trade, occupation, business or profession, and who has any person

in service under any contract of hire. NEB. REV. STAT. §48-114.

The Nebraska Workers’ Compensation Act does not apply to

railroad companies; or service performed by a worker who is a

household domestic servant in a private residence. Under the

revised statute, these employers may elect to be covered by the Act

by procuring a policy of workers’ compensation insurance

covering its employees.

b) Agricultural Employers

Section 48-106 exempts employers engaged in an “agricultural

operation” from application of the Act. An “agricultural

operation” involves (1) the cultivation of land for the production of

agricultural crops, fruit or other horticultural products or (2) the

ownership, keeping or feeding of animals for the production of

livestock or livestock products. When dealing with “agricultural

operations,” the Act does not apply to: (1) service performed by a

worker when performed for an employer who is engaged in an

agricultural operation and employs only related employees; (2)

service performed by a worker when performed for an employer

who is engaged in an agricultural operation and employs unrelated

employees unless such service is performed for an employer who

during any calendar year employs ten or more unrelated, full-time

employees, whether in one or more locations, on each working day

for thirteen calendar weeks, whether or not such weeks are

consecutive, and; (3) service performed by a persons who is

engaged in an agricultural operation, or performed by his or her

related employees, when the service performed is (I) occasional

and (ii) for another person who is engaged in an agricultural

operation who has provided or will provide reciprocal or similar

service. Similar to railroad companies and employers of household

domestic servants, employers engaged in agricultural operations

can elect to be covered by the Act by obtaining a policy of

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workers’ compensation insurance. However, if the employer elects

to not obtain such insurance it must provide the employee, at the

time of hire, written notice alerting the employee to the fact that he

or she will not be covered under the Act. Section 48-106 provides

specific language to be included in that written notice, and if

exempt employers fail to provide this notice it will be subject to

liability under the Act.

c) Statutory Employers

The question as to whether an employer is a “statutory employer”

frequently arises in the context of construction projects, and

common carrier/trucking situations. NEB. REV. STAT. §48-116.

An owner who employs an independent contractor to do work

which is in the usual course of the business of the owner, and who

fails to require the independent contractor to procure workers’

compensation insurance is liable as a “statutory employer” should

one of the employees of the independent contractor become injured

on the job. Franklin v. Pawley, 215 Neb. 624, 340 N.W.2d 156

(1983). The actual employer remains primarily liable and the

statutory employer is secondarily liable and the statutory employer

has a right to indemnity against the actual employer if it is forced

to pay benefits. Duffy Bros. Const. Co., v. Pistone Builders, Inc.,

207 Neb. 360, 299 N.W.2d 170 (1980).

d) Executive Officers

Executive officers of a corporation who own less than 25 percent

of the common stock of the corporation and executive officers of a

Nebraska nonprofit corporation who receive more than $1,000 per

year in compensation are considered employees covered under the

Act. NEB. REV. STAT. §48-115(9).

An officer who owns 25 percent or more of the stock, or an officer

of a non-profit corporation who receives less than $1,000 per year

in compensation; are not considered employees under the Act,

unless they make a formal election to do so. NEB. REV. STAT §48-

115(9).

e) Self-Employed Persons

Self-employed persons can be considered “employees” as well as

“employers” if they elect to be covered under the Act. NEB. REV.

STAT. §48-115(10).

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f) Independent contractor/10 factor test

To determine whether a worker is an employee or an independent

contractor, Nebraska looks to ten different factors. Generally,

although it is not specifically stated in the case law, the amount of

control that the purported employer exerts over the worker is

considered the most important factor. The factors are:

(i). Amount of control

(ii) Whether a worker is engaged in a distinct occupation or

business

(iii) Kind of occupation involved

(iv) Skill required in the particular occupation

(v) Which party supplies the instrumentalities, tools or place of

work

(vi) Length of employment period

(vii) Method of payment

(viii) Whether the work is part of the regular business of the

employer

(ix) Whether the parties believe they are creating an

employer/employee relationship

(x) Whether the employer is or is not in business

Larson v. Hometown Comm., 248 Neb. 942, 540 N.W.2d 339 (1995).

g) Loaned employee

Where the general employer (loaning employer) lends an employee

to a special employer (borrowing employer) and:

(i) the employee has a contract of hire, express or

implied, with the special employer;

(ii) the work being done is essentially that of the special

employer; and

(iii) the special employer has the right to control the details of

the work.

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If the control of the person’s duties remains with the loaning

employer, then that is the employer who is primarily responsible in

the event of an accident, but both employers remain liable for

workers’ compensation benefits. B&C Excavating Co. v. Hiner,

207 Neb. 248, 298 N.W.2d 155 (1980).

h) Casual Employee

An employee who is not performing work in the regular trade,

business, profession or vocation of the employer is a casual

employee. A casual employee is not entitled to workers’

compensation benefits from the casual employer. Sentor v. City of

Lincoln, 124 Neb. 403, 246 N.W. 924 (1933).

i) Volunteers

Volunteers are generally not afforded coverage under the Nebraska

Workers’ Compensation Act. Levander v. Benevolent &

Protective Order of Elks, 257 Neb. 283, 596 N.W.2d 705 (1999).

Statutory exceptions include: Volunteer firefighters who are

members of any fire department which is organized under the laws

of the State of Nebraska; ambulance drivers and attendants; and

out-of-hospital emergency care providers who are members of an

emergency medical service for any county, city, village, rural or

suburban fire protection district, nonprofit corporation, or any

combination of such entities under the authority of NEB. REV.

STAT. §13-303. NEB. REV. STAT. §48-115.

C. Compensable events

When personal injury is caused by accident or occupational disease, arising out of

and in the course of his or her employment, such employees shall receive

compensation therefore from his or her employer if the employee was not

willfully negligent at the time of receiving such injury. NEB. REV. STAT. §48-101.

1. Accident

An “accident” is defined as an unexpected or unforeseen injury which occurs

suddenly and violently, producing at the time objective symptoms of an injury.

NEB. REV. STAT. §48-151(2). This obviously includes single events causing

injury such as slips, trips, falls, lifting incidents, etc. But the compensability of a

repetitive trauma injury is also tested under the statutory definition of accident.

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In repetitive or cumulative trauma cases the key issue is whether the “suddenly

and violently” element of the definition of “accident” has been met. In Dawes v.

Wittrock Sandblasting & Painting, 266 Neb. 526, 667 N.W.2d 167 (2003) the

Nebraska Supreme Court held that “‘suddenly and violently’ does not mean

instantaneously and with force, but, rather, the element is satisfied if the injury

occurs at an identifiable point in time requiring the employee to discontinue

employment and seek medical treatment.” Id. at 556, 667 N.W.2d at 193. In

other words, an accident in the context of repetitive or cumulative trauma does not

occur until, as a result of the injury, the employee has met both elements of the

definition of “suddenly and violently”—“discontinued employment” and “sought

medical treatment”. Risor v. Nebraska Boiler, 277 Neb. 679, 765 N.W.2d 170,

(2009). So how are the terms “discontinue employment” and “seek medical care”

defined?

a) Discontinuation of Employment

There is no clear definition of the term “discontinue employment”. Does

“discontinue employment” mean actually being gone from work, or just

changing the employee’s job duties, or reducing the amount of hours the

employee works? In Sandel v. Packaging Company of America, 317

N.W.2d 910, 211 Neb. 149 (1982), the employee “was unable, because of

pain and swelling, to continue her employment, and from that moment on

was unemployed”, constituting a discontinuation of employment. In

Jordon v. Morrill County, 603 N.W.2d 411, 258 Neb. 380 (1999), the

court affirmed a finding that the employee had not discontinued

employment where the employee never “missed time from work”. But the

court also instructed that to prove a “discontinuance of employment”, the

employee must be no longer able to “perform the work required.” In

Owen v. American Hydraulics, 606 N.W.2d 470, 258 Neb. 881 (2000), the

Supreme Court affirmed the trial judge’s finding that the employee had

discontinued employment because he “lost time from at work” when he

sought medical care, and when he returned to work he “never resumed his

duties” of his regular job “and was instead transferred to a position

requiring less strenuous activity.” In Risor v. Nebraska Boiler, 277 Neb.

679, 765 N.W.2d 170, (2009), the employer’s attempts to accommodate

the claimant’s hearing loss by writing notes, using hand signals, and

mouthing words for the claimant to lipread did not constitute a

discontinuance of employment as the employer did not attempt to transfer

the claimant to different duties because of his injuries—hearing loss; he

continued performing the same duties. In Potter v. McCulla, 851 N.W.2d

94, 288 Neb. 741 (2014), the Supreme Court explained that “the

requirement in our test that the employee miss or discontinue employment

is reasonably related to a determination of the time when the injury

manifests itself in disability”, and “an employee's disability is determined

by the employee's diminution of employability or impairment of earning

power or earning capacity.” And the diminution of employability

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“reasonably can only occur when an employee’s injury interferes with his

or her ability to perform the requirements of the job.” Id. at 751, 851

N.W.2d at 103.

b) Seek Medical Treatment

Nebraska appellate courts have not provided a definitive definition of the

term “seek medical care.” Does visiting a company nurse within the

employer’s location as a result of pain, to obtain bandages or ice,

constitute “seeking medical treatment”? Or does the employee actually

have to leave the premises for medical care in order to meet this

requirement? The ultimate answer may eventually depend on the

circumstances in which the question arises. If the question is posed in the

context of a statute of limitation case where a finding that obtaining care

from a plant nurse means the accident occurred early enough to bar the

claim, those facts will probably not constitute “seeking medical care”. But

if the question is posed in the context of a case where the only evidence of

“seeking medical care” is the employee obtaining care from a plant nurse,

those facts will probably constitute “seeking medical care”. We shall see.

2. Occupational disease

“Occupational disease means only a disease which is due to causes and conditions

which characteristic and peculiar to the particular trade, occupation, process, or

employment and excludes all ordinary diseases of life to which the general public

is exposed.” Neb. Rev. Stat. §48-151.

a) Characteristic and Peculiar to

An occupational disease must be a natural incident of a particular

occupation and must attach to that occupation a hazard which

distinguishes it from the usual run of occupation and which is in excess of

that attending employment in general . . . The statute does not require that

the disease be one which originates exclusively from the employment.

The statute means that the conditions of the employment must result in a

hazard which distinguishes it in character from employment generally.”

Ritter v. Hawkeye-Security Insurance Co., 178 Neb. 792,795, 135 N.W.2d

470, 472 (1965). See also, Miller v. Goodyear Tire & Rubber Co., 239

Neb. 1014, 480 N.W.2d 162 (1992).

b) Ordinary Diseases of Life

Whether the exclusion of “ordinary diseases of life” has any meaningful

application to the compensability analysis is questionable. There are no

appellate decisions which address this language. Presumably, a common

cold or the flu would fall into this category and be excluded as a

9

compensable condition. But if there were persuasive causation testimony

that but for the conditions of the employee’s employment, the employee

would not have contracted that condition, such a condition might indeed

be considered compensable.

c) Last Injurious Exposure Rule

In many occupational disease cases, the employee alleges multiple

exposures with multiple employers, spanning many years and sometimes

implicating the coverage of multiple insurers. The so-called “last

injurious exposure rule” is the vehicle by which the liability of the

employer and carrier responsible for the payment of benefits is

determined.

Under this rule, liability will be assigned to the employer for whom the

employee was working , or the insurance carrier covering the risk, at the

time that the last injurious exposure occurred. An exposure is “injurious”

if it is of the type which could cause the disease, given prolonged exposure

and once the requirement of some contributing factor has been met, courts

will not go on to weigh the relative amount of duration or the exposure

under various employers. Osteen v. A.C. and S., Inc., 209 Neb. 282, 288,

307 N.W.2d 514, 520 (1981).

d) Date of Disability

Fixes the rate of benefits and the cause of action accrues for purposes of

the statute of limitation. The court will determine the date of disability (i.e.

the date the employee was injured) by determining when the accumulated

effects of the substance manifested in disability.

3. Special Rules regarding certain Injuries--

a) Cardiovascular Injuries

Nebraska has a special set of rules for cases in which an employee

suffers a cardiovascular injury, such as heart attack or stroke. An

employee must prove that both the legal and medical cause of his

condition was his employment. Smith v. Fremont Contract Carriers,

218 Neb. 652, 358 N.W.2d 211 (1984); Leitz v. Roberts Dairy, 237

Neb. 235, 465 N.W.2d 601 (1991).

Legal Test:

An employee must prove that he suffered some work-related stress

or exertion which is greater than that in the ordinary non-

employment life of the employee or any other person.

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Medical Test:

An employee has the burden of proof to show by a preponderance

of the evidence, through expert medical testimony, that the

employee’s employment contributed in some material and

substantial degree to cause the employee’s injury.

b) Emotional/Psychological Injuries

Violence to the physical structure of the body which causes mental

stress is compensable in Nebraska. An employee’s psychiatric

problems or depression may be compensable if they are found to be

the product of a physical work-related injury. However, mental stress

at work which produces a mental or physical injury is not

compensable. Zach v. Nebraska State Patrol, 273 Neb. 1, 727 N.W.2d

206 (2007); Dyer v. Hasting Industries, 252 Neb. 361, 562 N.W.2d

248 (1997). Likewise, a psychological injury resulting solely from the

process of workers’ compensation or litigation is not proximately

caused by the underlying accident. Sweeney v. Kerstens & Lee Inc.,

268 Neb. 752 (2004).

The exception to the rule requiring violence to the physical structure of

the body for a mental injury to be compensable is when a “first

responder” or “frontline state employee” is able to prove that the

circumstances causing the mental injury or illness were “extraordinary

and unusual” in comparison to the normal conditions of the

employee’s particular employment, and those circumstances caused a

mental injury or illness. A “First Responder” is a deputy sheriff, a

police officer, an officer of the Nebraska State Patrol, a volunteer or

paid firefighter, or a volunteer or paid individual licensed under a

licensure classification in subdivision (1) of section 38-1217 who

provides medical care in order to prevent loss of life or aggravation of

physiological or psychological illness or injury. A “Frontline State

Employee” is an employee of the Department of Correctional Services

or the Department of Health and Human Services whose duties involve

regular and direct interaction with high-risk individuals. A “High-risk

Individual” means an individual in state custody for whom violent or

physically intimidating behavior is common, including, but not limited

to, a committed offender as defined in section 83-170, a patient at a

regional center as defined in section 71-911, and a juvenile committed

to the Youth Rehabilitation and Treatment Center-Kearney or the

Youth Rehabilitation and Treatment Center-Geneva. “State Custody”

means under the charge or control of a state institution or state agency

and includes time spent outside of the state institution or state agency.

NEB. REV. STAT. §48-101.01.

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D. “Arising out of” and “in the course of”

1. “Arising out of”

The phrase "arising out of" describes the accident and its origin, cause,

and character, i.e., whether it resulted from the risks arising within the

scope of the employee's job.

a) Employment Related Risk

The question is whether the causative danger occurred as a result of an

employment related risk. If a person’s risk of injury is increased by the

employment, the “arising out of” component is probably satisfied.

However, the employment must contribute some risk which resulted in the

injury. If it does not, the injury is not compensable.

For example, the Court of Appeals explained in Carter v. Becton-

Dickinson, 8 Neb.App. 900, 907, 603 N.W.2d 469, 474 (1999), that an

employee’s injuries suffered while simply engaged in “nonstrenuous

walking” did not arise out of her employment as “nonstrenuous walking is

the ‘epitome of a nonemployment risk’”. In Lucas v. Anderson Ford, 13

Neb. App. 133, 689 N.W.2d 354 (2004), the Court of Appeals affirmed a

lower court finding that a hypoglycemic employee’s his hip injuries

suffered when he fainted and fell to the floor after attempting to stand up

from behind his desk did not arise out of his employment as “[s]tanding up

from a seated position certainly does not constitute any greater risk” than

the “nonstrenuous walking” in Carter. And finally, in Maradiaga v.

Specialty Finishing & Travelers Indem. Co., 24 Neb.App. 199, 884

N.W.2d 153, (2016), the Court of Appeals affirmed a dismissal of an

employee’s ankle injury where it fractured when she stepped out of her car

in the employer’s parking lot because there was “no evidence that the

everyday activity of exiting a car, while carrying nothing heavier than a

small lunchbox, was a risk of Maradiaga's employment.”

b) Exception—Unexplained Falls

In unexplained fall cases, there is a presumption that unexplained falls

arise out of one’s employment. The employer then has the burden to rebut

this presumption with evidence of an idiopathic cause or other risk

personal to the employee. Logsdon v. ISCO Co., 260 Neb. 624, 618

N.W.2d 667 (2000).

2. “In the course of”

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This refers to the time, place, and circumstances of the accident. Misek v.

CNG Financial, 265 Neb. 837, 660 N.W.2d 495 (2003). Generally an

injury is “in the course” of employment if it:

• Takes place during the normal working hours of employment;

• Occurs at a place where the employee may reasonably be required to

be; and

• Takes place while the employee is fulfilling work duties or is engaged

in doing something incidental thereto. Skinner v. Ogallala Pub. Schl.,

262 Neb. 387, 631 N.W.2d 50 (2001).

3. Special Rules re “Arising out of” and “In the course of”

a) Going and Coming Rule

Injuries sustained by an employee while going to and from work do not arise

out of and in the course of employment unless it is determined that a distinct

causal connection exists between an employer-created condition and the

occurrence of the injury. Torres v. Aulick Leasing, Inc., 261 Neb. 1016, 628

N.W.2d 212 (2001).

The following exceptions, however, may apply:

(1) Commercial traveler/dual purpose exception

Where an employee, in the performance of his or her

duties, is required to travel and an accident occurs while he

or she is so engaged, the accident arises out of and in the

course of his employment. Commercial travelers are

regarded as acting in the course of his or her employment

during the entire period of travel on the employer’s

business. The mission of the employer must be the major

factor in the journey or movement, and not merely

incidental. Torres v. Aulick Leasing, Inc., supra.

(2) Dual purpose exception

If an employee is injured in an accident while on a trip

which serves a dual purpose of both a business and a

personal purpose, the injuries are compensable as arising

out of the course and scope of the employment provided the

trip involves some service to be performed on the

employer’s behalf which would have occasioned the trip,

even if it had not coincided with the personal journey.

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Jacobs v. Consolidated Telephone Co., 237 Neb. 772, 467

N.W.2d 864 (1991).

(3) Personal convenience exception

Under certain circumstances, some acts will be considered

to have arisen out of and in the course of employment even

when the employee is tendering to a to a matter of personal

comfort. These incidents can include leaving the

employer’s premises to obtain food or drink. So long as the

employee is not acting in conflict with specific instructions

from the employer and he or she is engaging in an activity

which would normally be expected under the conditions of

work, it is possible that the employee will remain within

the scope of employment.

For example, in Misek v. CNG Financial, 265 Neb. 837,

600 N.W.2d 495 (2003), the employee was injured while

walking to a convenience store to purchase soft drinks

for herself as well as her co- workers and supervisors.

The Nebraska Supreme Court found that even though the

incident did not occur on the employer’s premises, the

employee was entitled to worker’s compensation benefits.

Since soft drinks were not available on-site, the Court

found that the employee was indulging in a matter of

personal convenience and comfort that she would be

expected to indulge in, and since she obtained permission

from her supervisor the accident and injury arose out of an

in the course of her employment.

(4) Special errand exception

When an employee, having identifiable time and space

limits on the employment, makes an off-premises journey

which would normally not be covered under the usual

going and coming rule, the journey may be brought within

the course of employment by the fact that the trouble and

time of making the journey, or the special inconvenience,

hazard, or urgency of making it in the particular

circumstances, is itself sufficiently substantial to be viewed

as an integral part of the service itself. The special errand

exception applies when there is instruction, direction,

requirement, or suggestion by the employer that the

employee make the journey. Torres v. Aulick Leasing, Inc.,

supra.

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(5) Employer supplied transportation

Where the employer furnishes transportation to the

employee, and the trip going to and coming from work is

made in a vehicle under the control of the employer, an

injury during that trip is incurred in the course of

employment. Butt v. City Wide Rock Exc. Co., 204 Neb.

126, 281 N.W.2d 406 (1979). Where an employer pays an

employee’s mileage expenses for travel to and from the

employee’s home as a result o the employee’s use of a

personal vehicle, an injury sustained while the employee is

going to or coming from work in that vehicle is one which

likely arises out of and is in the course of the employee’s

employment.

(6) Injuries sustained in employer parking lot or public lot

where employee is directed to park.

Injuries sustained on the employer’s parking lot are

generally compensable. Buck v. Iowa Beef Processors Inc.,

198 Neb. 125, 251 N.W.2d 875 (1977). For example, a

shopping center parking lot provided for the convenience

of, and used by, employees of the business located in the

center (i.e. strip mall) is considered part of the premises of

an employer located in the center. Zoucha v. Touch of

Class Lounge, 269 neb. 89, 690 N.W.2d 610 (2005).

(7) Injuries sustained in public areas

Under certain circumstances, injuries occurring in public

areas have been found compensable. For example, in

Coffey v. Waldinger Corp., 11 Neb. App. 293, 649 N.W.2d

197 (2002), the employer encouraged its employees to use

a fenced lot across from the premises, where employees

were allowed to park for free. An employee was then hit

and killed by a motorist as the employee attempted to cross

the street from the assigned parking lot ot the work site.

The court concluded that the employer created a condition

under which its employees would necessarily encounter

hazards while traveling to the premises where they worked.

Accordingly, the Court held that there was a distinct, casual

connection between the employer’s encouragement of its

employees’ use of the parking lot and the occurrence of the

accident.

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b) Act of God

And injury is considered to have arisen out of and is in the course of

employment if it is caused by an act of God, if the employment exposes the

worker to an increased risk of being injured by an act of God. Ingram v.

Bradley, 183 Neb. 692, 163 N.W.2d. 875 (1969).

E. Causation

1. Burden of Proof

a) Plaintiff’s Burden

“The claimant has the burden of proof to establish by a preponderance

of the evidence that such unexpected or unforeseen injury was in fact

caused by the employment. There is no presumption from the mere

occurrence of such unexpected or unforeseen injury that the injury was

in fact caused by the employment.” NEB. REV. STAT. §48-151(2)

The employee bears the burden to establish a causal relationship between

the alleged injury and his or her employment. In order for an injury to be

compensable it must have been caused by a work related accident or

occupational disease. One should not assume that the accident caused the

injury or that the injury caused the disability. Mendoza v. Pepsi Cola

Bottling Co., 8 Neb. App. 778, 603 N.W.2d 156 (1999).

2. Necessity of Expert Opinion

Unless the character of an injury is objective, that is, an injury’s nature and effect

are plainly apparent (i.e. amputation of arm), an injury is a subjective condition,

requiring an opinion by an expert to establish the causal relationship between an

incident and the injury, as well as any claimed disability consequent to such an

injury. Caradori v. Frontier Airlines, Inc., 213 Neb. 513, 329 N.W.2d 865

(1983).

3. Existence of Expert Opinion

The medical history contained in the medical records does not establish

causation. Lounnaphanh v. Monfort, Inc., 585 N.W.2d 783, 7 Neb. App. 452

(1998)

4. Sufficiency of Expert Opinion

For medical testimony to be the basis for an award, it must be sufficiently

definite and certain that a conclusion can be drawn that there was a causal

16

connection between the accident and the disability. Edmonds v. IBP, Inc., 239

Neb. 899, 479 N.W.2d 754 (1992).

An award of the Workers’ Compensation Court cannot be based on mere

speculation or possibility. Edmonds v. IBP, Inc., 239 Neb. 899, 479 N.W.2d 754

(1992); Caradori v. Fronteir Airlines, Inc., 213 Neb. 513, 329 N.W.2d 865

(1983). An award cannot be based on possibility or speculation and if an

inference favorable to the claimant can only be reached on the basis thereof, then

he cannot recover. Welke v. City of Ainsworth, 138 N.W.2d 808, 179 Neb. 496

(1965).

When a physician's testimony gives rise to conflicting inferences of equal

degree of probability so that the choice between them is a mere matter of

conjecture, a compensation award cannot be sustained. Welke v. City of

Ainsworth, 179 Neb. 496, 138 N.W.2d 808 (1965).

Expert testimony that a claimant’s injury “appeared” to be work related is

insufficient as a matter of law to prove to a reasonable degree of medical

certainty a causal connection between the injury and the work-related

activity. Fowler v. Lester Electric, 3 Neb. App. 191, 501 N.W.2d 728 (1993).

Expert medical testimony based on “could”, “may” or “possibly” lacks the

definiteness required to support an award. Edmonds v. IBP, Inc., 239 Neb.

899, 479 N.W.2d 754 (1992).

And expert’s use of the word “suggest”, by itself, is inadequate. Miner v.

Robertson Home Furnishing, 239 Neb. 525, 476 N.W.2d 854 (1991);

Lounnaphanh v. Monfort, Inc., 583 N.W.2d 783, 7 Neb. App. 452 (1998).

Testimony that a work-related accident "very likely" exacerbated claimant's

preexisting condition held sufficient. Hare v. Watts Trucking Service, 220

Neb. 403, 370 N.W.2d 143 (1985).

Testimony that it was "very probable" that the injury related to the accident held

legally sufficient. Halbert v. Champion International, 215 Neb. 200, 337 N.W.2d

764 (1983).

“Magic words” to the effect that an expert’s opinion is based on a reasonable

degree of medical certainty or probability are not necessary. The sufficiency of

an expert’s opinion is judged in the context of the expert’s entire statement.

Miner v. Robertson Home Furnishing, 239 Neb. 525, 476 N.W.2d 854 (1991);

Michel v. Nuway Drug Serv., 14 Neb. App. 902, 717 N.W.2d 528 (2006).

Where an expert’s opinion does not use "magic words" to express the opinion

that the employee’s injury was caused by the work accident, the court may

consider the "larger context" of an expert’s opinion as to whether the

17

expert’s pinion is sufficient to support an award. Miner v. Robertson Home

Furnishing, 239 Neb. 525, 476 N.W.2d 854 (1991)

5. Consecutive Events Following Compensable Accident

A separate compensable injury for each and every work aggravation is not

required if the initial cause of the injuries is a direct and natural result of the

compensable injury. Hynes v. Good Samaritan Hosp., 291 Neb 757, 869 N.W.2d

78 (2015). See also Stacy v. Great Lakes Agri Mktg., 276 Neb. 236, 753 N.W.2d

785 (2008).

.

When the question is whether compensability should be extended to a subsequent

injury or aggravation related in some way to the primary injury, the rules that

come into play are essentially based upon the concepts of “direct and natural

results.” Stacy v. Great Lakes Agri Mktg., 276 Neb. 236, 753 N.W.2d 785 (2008).

6. Admissibility of Expert Opinion

Expert testimony should not be received if it appears the witness is not in

possession of such facts as will enable him or her to express a reasonably accurate

conclusion, as distinguished from a mere guess or conjecture. Hynes v. Good

Samaritan Hosp., 291 Neb. 757, 869 N.W.2d 78 (2015).

Because the application of Daubert standards in Nebraska is limited to cases

in which the Nebraska rules of evidence apply, and those rules do not apply

in workers' compensation cases, the admissibility of an expert’s testimony is

analyzed under due process. Veatch v. American Tool, 676 N.W.2d 730, 267

Neb. 711 (Neb. 2004).

A qualified expert may not testify without adequate basis for his or her opinions

concerning the facts of the case on which the expert is testifying. Expert

testimony should not be received if it appears that the witness is not in possession

of such facts as will enable the expert to express a reasonably accurate conclusion,

and where the opinion is based on facts shown not to be true, the opinion lacks

probative value. The opinion must have a sufficient factual basis so that the

opinion is not mere conjecture or guess. Thus, a trial court may exclude an expert

opinion because the expert is not qualified, because there is no proper foundation

or factual basis for the opinion, because the testimony would not assist the trier of

fact to understand the factual issue, or because the testimony is not relevant.

Sheridan v. Catering Mgmt., Inc., 252 Neb. 825, 566 N.W.2d 110 (1997)

7. Aggravation of a Pre-existing Condition

A workers' compensation claimant may recover when an injury, arising out of and

in the course of employment, combines with a preexisting condition to produce

disability, notwithstanding that in the absence of the preexisting condition no

18

disability would have resulted. Heiliger v. Walters & Heiliger Electric, Inc., 236

Neb. 459, 461 N.W.2d 565 (1990); Spangler v. State, 233 Neb. 790, 448 N.W.2d

145 (1989); Miller v. Goodyear Tire & Rubber Co. 239 Neb. 1014, 480 N.W.2d

162 (1992).

F. Defenses to Compensability:

1. Factual defenses

E.g., the employee’s assertion of a work event is not credible.

2. Causation

E.g., the injury not caused by employment; worker’s physical condition caused by

pre-existing condition.

a. Natural Progression of Pre-existing Condition v. Aggravation

The natural progression of a pre-existing condition is not

compensable. However, where a work related injury combines with a

pre-existing injury to produce additional disability, the entire

disability is compensable. Heiliger v. Walters & Heiliger Electric,

Inc., 236 Neb. 459, 461 N.W.2d 565 (1990); Spangler v. State, 233

Neb. 790, 448 N.W.2d 145 (1989); Miller v. Goodyear Tire & Rubber

Co. 239 Neb. 1014, 480 N.W.2d 162 (1992). When assessing an

aggravation claim one needs to ascertain the nature and symptoms

associated with the pre-existing condition and then compare those

symptoms with those which follow the work-related event.

(1) Work event not a substantial contributing factor

An aggravation claim may be defensible if there is

evidence that the work-related event was not a contributing

factor to the disability. Please note that a doctor’s opinion

that the work-related event is the “straw that broke the

camel’s back” is probably sufficient medical evidence to

make the claim compensable.

(2) Evidence of prior independent disability

An aggravation claim may be defensible if there is

evidence that the employee’s pre-existing impairment was

independently producing disability before the accident and

is continuing to operate as the source of the disability after

the accident. Facts suggestive of long term continual

19

treatment and/or disabilities similar to those occurring after

the accident are important.

3. Legal and Statutory Defenses

Generally, the burden of proof in establishing an affirmative defense to a

workers’ compensation claim is on the employer. Intoxication or willful

negligence are affirmative defenses, Hilt Truck Lines, Inc. v. Jones, 204 Neb.

115, 281 N.W.2d 399 (1979).

a) Statute of Limitations

A workers’ compensation claimant has two years to file a claim against his

or her employer. NEB. REV. STAT. §48-137. The two-year statute of

limitation period begins to run when the claimant knew or reasonably

should have known he or she had a claim to make for payment of medical

or indemnity benefits. Pursuant to the statute, a claimant must file his or

her Petition within the two years of either (1) the date of accident, or (2)

the date of the last payment of benefits, either indemnity or medical

payments - whichever is later.

b) Notice of Injury

Under NEB. REV. STAT. §48-133, an employee is required to notify the

employer of an injury “as soon as practicable” after the happening thereof.

A delay in reporting a work injury from December to May exceeds the

outer limit of any reasonable delay and precludes the employee from

recovering benefits. Williamson v. Werner Enterprises, Inc., 682 N.W.2d

723, 12 Neb. App. 642 (2004).

c) Willful Negligence

An employee will not be entitled to workers’ compensation benefits if the

employee was willfully negligent at the time of the injury. Willful

negligence includes:

1. A deliberate act which constitutes a reckless disregard for the

consequences coupled with a consciousness that injury will

naturally or probably result. Estate of Coe v. Willmes

Trucking, 268 Neb. 880, 689 N.W.2d 318 (2004).

2. Intoxication

Note that mere intoxication at the time of the accident is not

enough. The employer must prove that the intoxication caused

the accident or injury.

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d) Violation of a Safety Rule

An employee’s deliberate or intentional defiance of a reasonable rule will

disqualify that employee from receiving benefits if:

1. the employer has a reasonable rule designed to protect the

health and safety of the employee,

2. the employee has actual notice of the rule,

3. the employee has an understanding of the danger involved

in the violation of the rule,

4. the rule is kept alive by bona fide enforcement by the

employer, and

5. the employee does not have a bona fide excuse for the rule

violations.

Guico v. Excel Corp., 260 Neb. 712, 720–721, 619 N.W.2d 470,

477 (2000).

e) Immigration Status

An undocumented alien is still an employee under the Nebraska Worker’s

Compensation Act and entitled to benefits as any other employee would

be. Even though an undocumented alien cannot legally work in the United

States, the Court found that the Act still covers such workers and if the

Legislature meant to exclude undocumented aliens from coverage, they

could have easily done so. Visoso v. Cargill Meat Solutions, 285 Neb. 272,

826 N.W.2d 845 (2009).

The Court has also confirmed that an employee’s undocumented status

does not preclude that employee from being found permanently totally

disabled. Moyera v. Quality Pork International, 284 Neb. 963, 825

N.W.2d 409 (2013).

However, if the evidence proves that the undocumented alien intends to

remain an unauthorized worker and reside in the United States, then he or

she will not be entitled to vocational rehabilitation services. Ortiz v.

Cement Products, 270 Neb. 787, 708 N.W.2d 610 (2005).

f) Misrepresentation During Hiring

No compensation shall be allowed if, at the time of or in the course of

entering into employment or at the time of receiving notice of the removal

21

of conditions from a conditional offer of employment: (1) The employee

knowingly and willfully made a false representation as to his or her

physical or medical condition by acknowledging in writing that he or she

is able to perform the essential functions of the job with or without

reasonable accommodation based upon the employer's written job

description; (2) the employer relied upon the false representation and the

reliance was a substantial factor in the hiring; and (3) a causal connection

existed between the false representation and the injury. Neb. Rev. Stat. §

48-148.01

III. Benefits

A. Average Weekly Wage (AWW)

Wages are defined as “the money rate at which the service is compensated under

the contract of hire in force at the time of the accident.” In most cases, AWW

will be calculated using the wages received during the preceding 26 weeks.

1. Tips are normally included in AWW.

2. Bonuses are normally included in AWW.

3. Overtime hours are included in AWW but not overtime wages.

4. Room and board is excluded unless (1) the value of room and board was

fixed by the parties at the time of hire, or (2) insurance premiums are

collected based upon the value of room and board.

5. Fringe benefits are excluded unless the value was agreed upon and fixed

by the parties at the time of hire.

6. Abnormally low weeks are EXCLUDED from AWW calculation. Canas

v. Maryland Cas. Co., 236 Neb. 164, 459 N.W.2d 533 (1990); Scott v.

Drivers Management, Inc., 14 Neb. App. 630, 714 N.W.2d 23 (2006).

7. Abnormally high weeks are INCLUDED. Arbtin v. Puritan Mfg. Co., 13

Neb. App. 540, 696 N.W.2d 905 (2005).

8. If the “character” of the employee’s employment changes during the 26

weeks prior to the accident, only the wages after the change in the

character of the employment shall be included in the calculation of the

average weekly wage. Griffin v. Drivers Management, Inc., 714 N.W.2d

749, 14 Neb. App 722 (2006).

B. Temporary Disability Benefits

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An employee’s entitlement to temporary benefits ceases at the point when all

injuries from the accident or occupational disease have reached maximum

medical improvement. Foreman v. State, 240 Neb. 716, 483 N.W.2d 752 (1992).

1. Temporary Total Disability (TTD)

After being off work at least 7 calendar days (which need not be

consecutive) and still under medical care due to a covered injury, an

employee is entitled to receive weekly benefits of “temporary total

disability” which are calculated at two-thirds of the worker’s gross

average weekly wage – currently subject to a maximum of $760 per week

(for dates of accident occurring in the 2015 year). Benefit is payable until

maximum medical improvement is obtained.

2. Temporary Partial Disability (TPD)

If the employee is able to return to part-time work or to a position in

which he/she earns less than his/her prior wage while under medical care,

it has long been thought that the employee was entitled to weekly benefits

of two-thirds of the difference between the wage and the employee’s

average weekly wage at the time of the accident, subject to the maximum

rate. That still remains the prevailing practice. However, in Damme v.

Pike Enterprises, Inc., 865 N.W.2d 422, 289 Neb. 620 (2014), the

Supreme Court specifically rejected the employer’s assertion that

temporary disability benefits are intended to replace a claimant’s wages

while healing from an injury. It instructed that “under the Nebraska

Workers' Compensation Act, both temporary and permanent disability

benefits are awarded for diminished employability or impaired earning

capacity and do not depend on a finding that the claimant cannot be placed

with the same employer or a different one . . . In short, the level of a

worker's disability depends on the extent of diminished employability or

impairment of earning capacity, and does not directly correlate to current

wages.” Damme v. Pike Enters., Inc., 289 Neb. 620, 856 N.W.2d 422,

(2014). (Emphasis added) The Court did not provide an explanation as to

how this will work in practice, where an employee’s functional limitations

usually vary while recovering from injury, and the employee’s earning

capacity is driven in large part by the limitations.

C. Permanent Disability Benefits

I. Scheduled member injuries

If as a result of his or her accident the employee suffers permanent

impairment to a member, i.e., arms, legs, feet, hands, etc., compensation is

payable for that impairment (also known as physical los of use) for a

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scheduled period of weeks calculated under state law. (Neb.Rev.Stat. 48-

121(3)).

II. Body as a whole injuries

If the injury is to the body as a whole which is defined to mean the “trunk

of the body” such as the back, hip, neck, head, etc., then compensation is

payable for the loss of earning capacity sustained as a result of the injury.

a) Permanent Total Disability

Where the employee is permanently and totally disabled, the employee is

entitled to have benefits paid as long as the employee is totally disabled--

may be for life if injury prevents return to work. Benefits are two-thirds

of the worker’s pre-accident average weekly wage.

Nebraska has adopted the “odd lot” doctrine, which means that total

disability may be found in the case of workers who, while not altogether

incapacitated for work, are so handicapped that they will not be employed

regularly in any well-known branch of the labor market. The essence of

the test is the probable dependability with which claimant can sell his

services in a competitive labor market, undistorted by such factors as

business booms, sympathy of a particular employer or friends, temporary

good luck, or the superhuman efforts of the claimant to rise above his

crippling handicaps. Schlup v. Auburn Needleworks, Inc., 239 Neb. 854,

479 N.W.2d 440, (1992).

III. Multiple Injuries in One Accident

a) Multiple Schedule Member Injuries

30 % rule-- An employee with multiple scheduled member injuries

caused by one accident may be entitled to permanent benefits based on a

loss of earning power, rather than the schedule, if the combined effects of

the injuries result in a loss of earning power in excess of 30%. Neb. Rev.

Stat. §48-121(3).

b) BAW combined with scheduled member injury

If a worker sustains a scheduled member injury and a whole body injury

in the same accident, the court may consider the impact of both injuries in

assessing the loss of earning capacity. Zavala v. ConAgra Beef Co., 265

Neb. 188, 655 N.W.2d 692 (2003).

To determine if restrictions from both the scheduled member and body as

a whole injury should be considered, the court must determine whether the

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scheduled member injury adversely affects the worker such that loss of

earning capacity cannot be fairly and accurately assessed without

considering the impact of the scheduled member injury upon the worker’s

employability. If the loss of earning capacity cannot be fairly and

accurately assessed without such consideration, then the court is permitted

to consider both the schedule member and the body as a whole injuries to

determine the plaintiff’s loss of earning power. However, the claimant

may not recover both a loss of earning that takes into account a schedule

member injury and indemnity for the permanent impairment of the

scheduled member injury. Bishop v. Specialty Fabrication Co., 277 Neb.

171, 760 N.W.2d 352 (2009); Madlock v. Square D Co., 269 Neb. 675,

695 N.W.2d 412 (2005); Zavala v. ConAgra Beef Co., 265 Neb. 1888, 655

N.W.2d 692 (2003).

D. Death Benefits

If a worker dies as a result of his or her work injury, the widow(er) is entitled to

weekly compensation benefits for life or until remarriage at the rate of two-thirds

of the worker’s gross average weekly wage at the time of death subject to the

maximum rate per week. Upon remarriage, the widow(er) receives two (2) years

of benefits in one lump sum. NEB. REV. STAT. § 48-122

Dependent children: If the worker was survived by dependent children at the

time of death, weekly benefits are payable to the children during their

dependency or until age 19, or age 25 if incapable of support or a full-time

student.

Burial—Employer must pay expenses of burial up to $10,000.

E. Apportionment

Under certain limited circumstances, apportionment of a claimant’s disability

between a prior injury and the current injury is allowed. The loss of earning

capacity attributable to a previous injury may be apportionable if there is

evidence that the injury, (1) was an injury to the body as a whole, (2) was

independently producing some disability prior to the current accident, (3)

continued to operate as a source of disability after the accident, and (4) claimant

was “compensated” for the previous injury. Martinez-Najarro v. IBP, Inc., 12

Neb. App. 504, 678 N.W.2d 114 (2004). Apportionment occurs after the loss of

earning power evaluation for the current injury has been determined, the amount

of loss of earning power for which the claimant has already been compensated

being then deducted from the subsequent loss of earning power. Martinez-

Najarro, supra.

F. Medical Care

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1. Employee’s Right to Choose

If the employer has given a Form 50 (choice of physician form) to the

employee, the injured employee has the right to choose his or her

physician but only if that physician is one who has previously treated the

employee or an immediate family member and has records of such

treatment. NEB. REV. STAT. §48-120(2)(a). Family member includes: a

spouse, children, parents, stepchildren, and stepparents of the employee.

If the employer does not provide the employee with a Form 50 or

compensability was denied, the employee is free to treat with any, and

perhaps as many physicians as desired, without limitation to the family

doctor

2. Employer’s Right to Choose

The employer has the right to select the physician if an employee executes

a Form 50 and does not select a physician, or no physician meets the

previous treatment of employee or immediate family member requirement.

3. Unlimited Medical Expenses

The employer is liable for all reasonable medical, surgical, and hospital

services which are required by the nature of the injury and which will

relieve pain or promote and hasten the employee’s restoration to health

and employment. NEB. REV. STAT. §48-120.

a) Reasonable and Necessary--There is no limit on the amount of

medical treatment to which an employee is entitled as long as the

treatment is necessary and the charges do not exceed either the

applicable Fee Schedule or the “regular charges” for services

provided.

4. Independent Medical Examiner (IME)

When there is a dispute regarding a plaintiff’s medical condition or related

issues, either party may request an IME. The parties may either agree on

an independent medical examiner or may request that the court appoint an

IME provider. The cost of the IME is paid by the employer/insurer

regardless of which party requests the IME. NEB. REV. STAT. § 48-

134.01.

5. Defense Medical Examiner (DME)

The employer/insurer has the right from time to time during the

continuance of and employee’s alleged work-related disability to have the

employee examined by a physician of its choosing. The employee has the

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right to have a physician provided and paid for by the employee present at

the examination

6. Schedule of Fees

Nebraska’s fee schedule structure is divided into three general categories:

(1) Medical Services (physicians, therapists, etc.), (2) Hospital and

Ambulatory Surgical Centers and (3) Implantable Medical Devices. The

Workers’ Compensation Court revises this at least every two years.

7. Managed Care

Employers and insurance companies may contract for medical, surgical,

hospital, and rehabilitation services to be provided through a managed

care plan. The managed care plan must be certified by the Compensation

Court. NEB. REV. STAT.§48-120(9); Nebraska Workers' Compensation

Court Rule of Procedure 53. Compensability must be accepted in order to

limit an employee to treatment within the managed care plan.

G. Vocational Rehabilitation

NEB. REV. STAT. §48-162.01(3) provides: “When as a result of the injury, the

employee is unable to perform suitable work for which he has previous training or

experience, he is entitled to such vocational rehabilitation services, including job

placement and training, as may be reasonably necessary to restore him to suitable

employment.”

1. Immigration Status

Illegal aliens who may not be lawfully employed in the United States and

who intend on remaining in the United States, are not entitled to

vocational rehabilitation services in the United States. Ortiz v. Cement

Products, 270 Neb. 787, 708 N.W.2d 610 (2005).

2. Suitable/Gainful Employment

The Nebraska Supreme Court has held that accepting a job paying

minimum wage does not automatically restore a claimant to "suitable" or

"gainful" employment pursuant to this section, where the claimant's

previous employment was at a significantly higher wage. Yager v. Bellco

Midwest, 236 Neb. 888, 464 N.W.2d 335 (1991). In 2017 the Court

specifically defined “gainful employment” to be “employment similar in

remuneration to that earned prior to the injury” and noted that “[i]mplicit

in this is that the gainful employment sought to be restored must be

‘suitable’” Anderson v. EMCOR Group, 298 Neb. 174, ___ N.W.2d

___(2017). The Court defined “suitable” employment as “employment

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which is compatible with the employee’s pre-injury occupation, age,

education, and aptitude.” Id.

3. Appointment/Selection/Payment of Vocational Counselors

NEB. REV. STAT. §48-162.01 provides that the employer and employee

are to attempt to agree upon a vocational counselor to act as the counselor

of record. If no agreement can be reached, the Compensation Court is to

be notified of the disagreement in writing, along with a request for the

appointment of a counselor from a directory maintained by the court.

4. Fee for Vocational Rehabilitation Evaluation and Vocational Plan

The fee for the evaluation and the vocational rehabilitation plan is to be

paid by the employer or its workers’ compensation insurance carrier.

The fee of the vocational rehabilitation counselor for the loss of earning

power evaluation shall be paid for by the employer/ insurer within thirty

(30) days of receipt of a statement of charges. Rule 45 (c) of Procedure,

Workers’ Compensation Court.

5. Indemnity benefits to employee during vocational plan

The insurer/employer generally has an obligation to pay temporary total

disability benefits, or, in certain limited situations, temporary partial

disability benefits, during the vocational rehabilitation program. The

Workers’ Compensation Trust Fund pays tuition, book expense, mileage,

and lodging expenses incurred as a result of vocational rehabilitation,

when applicable. NEB. REV. STAT. §48-162.01.

6. Court Rules relating to Vocational Rehabilitation

Rules 36-38

Vocational Rehabilitation Counselor: Rules 39-41

Certification: Rule 40-41

Choice: Rule 42

Change: Rule 43

Vocational Rehabilitation Plan: Rule 44

IV. PENALTIES

A. 50% Waiting Time Penalty

May be awarded:

1. Only for nonpayment of indemnity benefits (not for non-payment or late

payment of medical expenses). See Roth v. Sarpy Co. Highway Dept., 253

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Neb. 703, 572 N.W.2d 786 (1998); Gaston v. Appleton Electric, 253 Neb.

897, 573 N.W.2d 131 (1998); and

2. If there is no reasonable controversy regarding compensability, and

3. Benefits are not paid within 30 days after notice of disability, Order,

Award, or Judgment

B. Attorney Fees

May be awarded if . . .

1. Penalty applies because of nonpayment of benefits;

2. Delinquent or nonpayment of medical expense;

3. Employer appeals and there is NO reduction in award;

4. Employee Appeals and receives additional benefits.

C. Interest and Court Costs

When the employee is awarded an attorney's fee under §48-125, the employee is

entitled to interest on the final Award. NEB. REV. STAT.§48-125(2). When the

employee is allowed an attorney's fee under §48-125, the employee shall further

be entitled to costs of depositions, if admitted into evidence, and the fees and

mileage for necessary witnesses attending the hearing at the request of the

employee. NEB. REV. STAT. §48-172.

V. SUBROGATION

A. Statutory Right to Subrogation

The employer (or its insurer) has a statutory right to be subrogated to any recovery by the

employee against a third-party tortfeasor for his or her work-related injuries. If the

parties cannot agree upon a distribution of the recovery, the District Court which has

jurisdiction over the matter is to make a “fair and equitable distribution” of any judgment

or settlement from the tortfeasor. In re Estate of Evertson, 295 Neb. 301, 889 N.W.2d 73

(2016); Turco v. Schuning, 271 Neb. 770, 708 N.W.2d 606 (2006); Jackson v. Branick

Industries, 254 Neb. 950, 581 N.W.2d 53 (1998).

As to what constitutes a “fair and equitable distribution”, the Supreme Court in Kroemer

v. Omaha Truck Equipment, L.L.C., 296 Neb. 972, 898 N.W.2d 661 (2017), quoting

liberally from its holding in Bacon v. DBI/SALA, 284 Neb. 579, 822 N.W.2d 14 (2012),

explained that “there is ‘no reason to conclude that the beneficent purposes of the Act

require us to narrowly interpret the employer's statutory subrogation rights.’ Rather, we

29

determined that ‘the policies behind the Act favor a liberal construction in favor of the

employer's statutory right to subrogate against culpable third parties.’ In an effort to

balance the rights of injured employees against the costs to employers, most workers'

compensation acts ‘liberally allow employers to shift liability onto third parties whenever

possible.’ We iterated that ‘§ 48-118 was enacted 'for the benefit of the employer'’ and

that where a third party negligently causes the employee's injury, ‘'employers who are

required to compensate employees for injuries are intentionally granted a measure of

relief equivalent to the compensation paid and the expenses incurred.'”

While the Supreme Court has not identified what factors shall be considered in making a

“fair and equitable” distribution, they have made it clear that the following factors shall

not be considered:

• Equitable principles, such as the doctrine of unclean hands,

equitable estoppel, promissory estoppel, and judicial

estoppel. Burns v. Nielsen, 273 Neb. 724, 732 N.W.2d 640

(2007).

• The “made whole” doctrine, requiring the employee be made

whole before the employer/insurer is entitled to any recovery

of its subrogation interest. Turco v. Schuning, 271 Neb. 770,

708 N.W.2d 606 (2006).

• The fact that the insurer was paid premiums by the employer in

exchange for its agreement to accept the risk of paying

workers’ compensation benefits. Kroemer v. Omaha Truck

Equipment, L.L.C., 296 Neb. 972, 898 N.W.2d 661 (2017).

• The comparative ability to deal with the risk of loss, as

between the employee and insurer. Kroemer v. Omaha Truck


• The participation, or lack thereof, of the insurer or employer in

making the third party recovery. Kroemer v. Omaha Truck


• Giving “short shrift to the right of the employer or its insurer”

to recover its subrogation interest. Kroemer v. Omaha Truck

Equipment, L.L.C., 296 Neb. 972, 898 N.W.2d 661 (2017). The

Court explained that the subrogation statute “encourages

prompt payment of benefits, even when a third party is liable

for the injury, by providing an employer or its insurer with the

means to recover at least a portion of its payout.”

B. Procedural Rules/Attorneys’ Fees

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Keep in mind the following regarding the procedures to follow in a third-party claim

where an employer/insurer’s subrogation right exists:

a. The employer/insurer must be made a party to any lawsuit by the

plaintiff against a third-party tortfeasor.

b. The employee must provide the employer/insurer with notice at least 30

days before filing suit. If the employee fails to provide the required

notice, he or she cannot recover expenses or attorney fees from the

subrogated amount.

c. The employee's attorney may be able to recover attorney fees against the

employer/insurer based upon the amount recovered to offset the

employer/insurer's subrogation interest.

d. Although there is no "sure fire" way to prevent claimant's attorney fee on

subrogated recovery, the employer may minimize this amount by hiring its

own counsel. Active participation by the employer's counsel in the

lawsuit is probably required in order to eliminate or minimize the

attorney's fee payable to the employee's attorney.

VI. SETTLEMENT OF A CLAIM

A. Lump Sum Settlement Approved by the Court

1. Court approval of settlements (through an application for lump sum

settlement) is required if:

a. The employee is not presented by counsel; or

b. The employee, at the time the settlement is executed, is eligible for

Medicare, is a Medicare beneficiary, or has a reasonable expectation of

becoming eligible for Medicare within thirty months after the date the

settlement is executed; or

c. Medical, surgical, or hospital expenses incurred for treatment of the injury

have been paid by Medicaid and Medicaid will not be reimbursed as part of

the settlement; or

d. Medical, surgical, or hospital expenses incurred for treatment of the injury

will not be fully paid as part of the settlement; or

e. The settlement seeks to commute amounts of compensation due to

dependents of the employee.

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2. The Court will generally not approve a lump sum settlement unless the

claimant:

a. Has reached maximum medical improvement.

b. Is currently working or receiving social security disability benefits.

c. Have his or her permanent impairment for injuries to the body as a whole

or scheduled member injuries assessed.

Exception--Court may approve even if one of the above is missing, if a

reasonable argument can be made as to the compensability of the

alleged work accident.

3. The Importance of Considering Medicare’s Interests

When considering the full and final settlement of a workers’

compensation claim, there should always be a determination made as to

whether Medicare has an interest in the claim that needs to be considered.

If so, steps need to be taken to satisfy Medicare’s interest so Medicare

does not deem the settlement as an attempt to improperly shift the cost of

the treatment of the work-related condition to Medicare. Whether a case

meets Medicare’s “workload review thresholds” or not, the claimant and

employer or insurer need to remain mindful of whether Medicare has a

potential interest in the settlement that needs to be protected.

a. Conditional Payments

These are payments made by Medicare that should have been paid

by the employer or insurer as part of the workers' compensation

claim, and they need to be identified and reimbursed. The

employer and insurer are required to agree to resolve any post-

settlement claims for reimbursement of Conditional Payments by

Medicare.

b. Medicare Set Aside

This is a vehicle that is used to set aside an amount of money to be

used to pay future Medicare covered medical expenses which are

necessitated by the work injury.

B. Settlement by Release:

Parties may settle claims without obtaining court approval where a court approved

lump sum settlement is not required (See above), by filing a release with the court.

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The release must be:

1. Signed and verified by the employee and the employee’s attorney;

2. On a form approved by the Workers’ Compensation Court;

http://www.wcc.ne.gov

3. Filed with the Workers’ Compensation Court;

4. After the settlement proceeds are paid, the parties must sign a stipulation

to dismiss the employee’s claim, and a proposed order doing so. This

applies even in cases which are not litigated.

http://www.wcc.ne.gov/

2018 YLS Best Practices Seminar - cdn.ymaws.com

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