DECISION AND ORDER
APPROVING SETTLEMENT
That above-captioned matter, which arises under the Longshore and Harbor Workers’
Compensation Act (LHWCA), 33 U.S.C. § 901 et seq. was assigned to the undersigned
administrative law judge for disposition. No hearing will be scheduled, however, as a settlement
has been submitted for approval. In that regard, a settlement agreement was originally submitted
on July 31, 2012. However, as the initial settlement did not comply with the regulatory
requirements, Associate Chief Judge Paul C. Johnson, Jr. issued a Notice of Deficiency on
August 13, 2012, which is incorporated by reference herein. Issuance of Judge Johnson’s Notice
tolled the period for approval of the settlement.
On September 11, 2012, counsel for Employer, on behalf of both parties, submitted a
revised Joint Petition and Application for Approval of Settlement Pursuant to Section 8(i) of the
Longshore and Harbor Workers’ Compensation Act, signed by the Claimant, his counsel, and
counsel for Employer/Carrier (“Settlement Agreement”), with attachments including a roster of
medical expenses, a fee petition with attached itemized entries, medical reports, and other
documentation. As the Settlement Agreement adequately addresses the deficiencies identified by
Judge Johnson and now complies with the regulatory requirements, it is being approved.
First, technical deficiencies in the prior settlement agreement have been corrected and it
now provides information that is required to be provided under 20 C.F.R. §702.242. As
amended, the Settlement Agreement describes the accident which gave rise to this claim.
Likewise, with respect to collateral sources for the payment of medical expenses, the Claimant
indicates that he currently holds health insurance through the International Longshoreman’s
Association. See 20 C.F.R. §702.242(a). Language in the Settlement Agreement that could be
construed as barring claims not currently in existence (including a Waiver clause) has been
deleted. See 20 C.F.R. §702.241(g). Also, an indemnification (Hold Harmless) clause relating to
Medicare has been deleted.
Second, the issues of past and future medical expenses have been adequately addressed.
Under 20 C.F.R. §702.242(b), a section 8(i) settlement is required to provide specified
information, including a statement as to medical expenses paid during the past three years and an
estimate of future medical expenses. However, the adjudicator may waive these requirements
for good cause. See generally Bomback v. Marine Terminals Corporation, BRB No. 10-0129, —
BRBS – (Ben. Rev. Bd. Oct. 19, 2010) (pub) (invalidating approval of section 8(i) settlement
when need for and estimated costs of future medical treatment was not addressed). The initial
agreement was not entirely clear on the issue of medical expenses. As amended, the Settlement
Agreement not only specifies medical expenses paid during the past three years but also specifies
Claimant’s out of pocket and private insurance payments for medical expenses (which were $0)
and includes a roster itemizing medical bills; it is therefore compliant on the past medical
expenses issue. With respect to future medical expenses, under the amended Settlement
Agreement, like its predecessor, $35,000 is allocated for past, present, and future medical
expenses and $50,000 is allocated for future Medicare covered expenses. As amended, the
Settlement Agreement clarifies that Claimant has not incurred any out-of-pocket medical
expenses, no private health insurance company has paid any expenses, and he has no outstanding
medical expenses regarding any compensable injuries associated with the accident; therefore, as
all past medical expenses have been paid, the $35,000 only relates to future medicals that would
not be covered by Medicare. Thus, a total of $85,000 is allocated for future medicals, but there
is no actual estimate of future expenses provided or explanation as to the basis for the $85,000
figure. I find that the Settlement Agreement adequately addresses the issues of past medical
expenses and, with respect to future medical expenses, a waiver is appropriate because, as the
Settlement Agreement provides, it is impossible to accurately predict the need for future
treatment, but the parties have made a good faith effort to do so, in order to resolve a contested
claim.
Attorney Fees and Costs. There is a general requirement that applications for attorney’s
fees be considered and approved by administrative law judges (for work performed before them)
even where settlements are involved. See, e.g., Ballard v. General Dynamics Corp., 12 BRBS
966 (1980); see also 20 C.F.R. § 702.132. As long as the parties have engaged in arm’s length
negotiations, however, the fee agreement should be approved if not clearly excessive, absent
evidence of collusion. See generally Eifler v. Peabody Coal Co., 13 F.3d 236, 27 BRBS 168
(CRT) (7th Cir. 1993). Fees and mileage for necessary witnesses may be assessed against the
employer and carrier as costs under section 28(d) of the Act, 33 U.S.C. § 928(d). Expert witness
fees are also payable under section 28(d). Hernandez v. National Steel & Shipbuilding Co., 13
BRBS 147, 150 (1980). See also Bradshaw v. J.A. McCarthy, Inc., 3 BRBS 195, 201-02 (1976),
petition for review denied, 564 F.2d 89 (3d Cir. 1977) (table). Having reviewed the fee petition,
and taking into consideration the criteria set forth in 20 C.F.R. §702.132, which require that any
fee approved be commensurate with the work performed, the complexity of the issues, the skill
with which the case was handled, and the amount recovered, I find that the agreed upon fee of
$40,000.00 (inclusive of costs) is reasonable and appropriate and it is approved.
Medicare Secondary Payer Act. Under the Medicare Secondary Payer Act (“MSP”), 42
U.S.C. §1395y(b), the Center for Medicare and Medicaid Services (“CMS”) may hold employers
and carriers responsible for future Medicare payments if medical expenses are compromised
without approval of the settlement by CMS. See 42 C.F.R. § 411.46. The parties indicate that
they have considered Medicare’s interests in the settlement, as set forth in the Settlement
Agreement. In approving this Settlement Agreement, I have not determined whether Medicare’s
interest (if any) in this matter has been adequately protected under the provisions of the MSP.
Having reviewed the Settlement Agreement, along with other matters of record, and
finding its terms to be fair, I hereby approve the terms thereof. I find that the Settlement
Agreement, as revised, comports in all material aspects with the requirements of section 8(i) of
the Act, 33 U.S.C. § 908(i) and its implementing regulations, 20 C.F.R. §702.241 to §702.243.
The terms of the Settlement Agreement are incorporated by reference herein. Service will be
made by the District Director, pursuant to 20 C.F.R. § 702.349.
FINDINGS OF FACT
1. The facts are set forth in the Settlement Agreement. Briefly, this action involves Claimant’s
claim that he was injured in an accident of May 17, 2010, in which a speaker that was being
loaded onto a cruise ship fell off the pallet and squeezed Claimant’s right calf, causing a
contusion and resulting in a right lower extremity injury. As a result of the accident, Claimant
alleged that he also sustained low back and right hip involvement; however, the Settlement
Agreement indicates that the low back and hip conditions are personal in nature and not related
to the industrial accident. The parties have reached an agreement on all material issues, as set
forth in the Settlement Agreement.
2. I find that the Settlement Agreement provides adequate relief to the Claimant and it has not
been procured by fraud or duress.
3. Settlement in the total amount of $225,000, our of which $185,000.00 is payable to Claimant
($100,00 for compensation and $85,000 for medical expenses) and $40,000.00 is for attorney
fees and costs (payable to David Pacheco, Esq., and his firm, Gillis, Mermell & Pacheco, P.A.),
is hereby approved and the parties are directed to carry out the requirements of the settlement.
4. I find that the Settlement Agreement provides adequate relief to the Claimant with respect to
the matters addressed and it has not been procured by fraud or duress.
ORDER
IT IS HEREBY ORDERED that that the Settlement Agreement should be, and hereby
is, APPROVED and the Employer/Carrier shall forthwith pay all amounts in accordance with
the above Findings of Fact and the provisions of the Settlement Agreement, and
IT IS FURTHER ORDERED that the liability of Employer and Carrier for
compensation, past and future medical benefits, and attorney fees and expenses under the
Longshore and Harbor Workers’ Compensation Act, as a result of Claimant’s accident and
injuries sustained on or about May 17, 2010, shall be discharged upon the payment of the agreed
upon sums.
PAMELA J. LAKES
Administrative Law Judge
Washington, D.C.
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Clifford R. Mermell, Esq., created the law firm of Gillis, Mermell & Pacheco, P.A. on March 1, 1996. Mr. Mermell has been the senior and managing partner of the firm since its creation. The firm was created to champion the rights of injured workers nationwide. It represents cases under the Worker’s Compensation, Wrongful Termination, Personal Injury, Admiralty and Maritime, Defense Base Act, and Longshore & Harbor Worker’s Compensation Act Laws.