Elite Care, RX v. Premier Comp Solutions

2023 Pa. Super. 88, 296 A.3d 29

• Court: Superior Court of Pennsylvania
• Decided: May 23, 2023
• Docket: 1144 WDA 2020
• Status: Published

Opinion

J-E02002-22

2023 PA Super 88

ELITE CARE, RX, LLC : IN THE SUPERIOR COURT OF : PENNSYLVANIA : v. : : : PREMIER COMP SOLUTIONS, LLC; : LAUNDRY OWNERS' MUTUAL : LIABILITY INSURANCE : No. 1144 WDA 2020 ASSOCIATION; UPMC BENEFIT : MANAGEMENT SERVICES, INC. : D/B/A UPMC WORK PARTNERS; : LACKAWANNA CASUALTY COMPANY; : AND BRICK STREET MUTUAL : INSURANCE COMPANY : : : APPEAL OF: PREMIER COMP : SOLUTIONS, LLC, LAUNDRY : OWNERS' MUTUAL LIABILITY : INSURANCE ASSOCIATION, : LACKAWANNA CASUALTY COMPANY : AND BRICK STREET MUTUAL : INSURANCE COMPANY :

Appeal from the Order Entered June 5, 2020 In the Court of Common Pleas of Allegheny County Civil Division at No(s): GD-19-005312

BEFORE: PANELLA, P.J., OLSON, J., DUBOW, J., KUNSELMAN, J., NICHOLS, J., MURRAY, J., McLAUGHLIN, J., McCAFFERY, J., and SULLIVAN, J.

CONCURRING OPINION BY McLAUGHLIN, J.: FILED: May 23, 2023

I respectfully believe that we do not need to consider whether the

Commonwealth Court’s decision in Armour Pharmacy v. Bureau of

Workers’ Compensation Fee Review Hearing Office, 206 A.3d 660, 666

(Pa.Cmwlth. 2019) (en banc), was correct. Rather, we can resolve this appeal J-E02002-22

under the Supreme Court's recent decision in Franczyk v. The Home Depot,

Inc., --- A.3d ----, 2023 WL 2992700, at *8 (Pa. Apr. 19, 2023).

In Franczyk, the Court held that whether an injury alleged in a lawsuit

is subject to the exclusivity provision of the Workers’ Compensation Act

(“WCA”) turns on whether “the asserted injury . . . is ‘intertwined’ inextricably

with the workplace injury.” Id. at *8. The plaintiff in Franczyk worked at a

retail store and had been bitten at work by a customer’s dog. Id. at *1. She

sued her employer and her supervisors, alleging they had “negligently allowed

the dog owner and witnesses to leave without obtaining identifying

information.” She claimed that in so doing, they “denied her the opportunity

to file a third-party suit against the dog owner.” Id.

The Supreme Court found that the WCA’s exclusivity provision

immunized the defendants from the employee’s suit because her claimed

injury was “not truly separable” from the work injury. Id. at *8. In reaching

its decision, the Court drew a contrast between its prior decisions in Martin

v. Lancaster Battery Co., Inc., 606 A.2d 444 (Pa. 1992), and Kuney v.

PMA Insurance Co., 578 A.2d 1285 (Pa. 1990) (“Kuney II”).

In Martin, an employee sustained extensive exposure to lead at his

work. Martin, 606 A.2d at 448. His employer tested employees on a regular

basis for lead content in their blood. Over several years, the employer willfully

and intentionally withheld test results from him or gave him altered results.

Id. The employer closely monitored lead levels in employees’ blood and

reported the results to them so that those with elevated levels of lead could

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transfer to areas of work where they would not be exposed to lead. Id. The

plaintiff was then diagnosed with chronic lead toxicity, lead neuropathy, and

other ailments. Id. at 446. His condition would have been substantially better

if his employer had not engaged in the deception. Id.

The Martin Court concluded that the claim for the aggravation of the

lead toxicity was not subject to the exclusivity provision. The Court found that

the claimed injury was separable from the work injury:

There is a difference between employers who tolerate workplace conditions that will result in a certain number of injuries or illnesses and those who actively mislead employees already suffering as the victims of workplace hazards. . . . The aggravation of the [physical] injury arises from and is related to the fraudulent misrepresentation of the employer.

Id. at 448. As the Supreme Court explained in Franczyk, the lawsuit was

permissible in Martin because “the employee was not seeking compensation

for the initial exposure but rather for the distinct (and preventable)

aggravation of the original injury—an injury unto itself.” Franczyk, 2023 WL

2992700, at *7.

In Kuney II, however, the Court did not find the injuries separable.

There, the Court framed the issue before it as whether the employer’s

immunity under the WCA protects its workers’ compensation insurer if it

allegedly “engaged in fraud and deceit to deprive an injured employee of his

workers’ compensation benefits.” Kuney II, 578 A.2d at 1285. The employee

there had sued the employer’s insurer for bad faith, claiming he had emotional

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distress injuries allegedly distinct from his workplace injury. See Franczyk,

2023 WL 2992700, at *8 n.50. The Court pointed out that the WCA provides

a remedy of 10% interest for due and unpaid compensation. Id. at 1286.

Because the employee’s claim boiled down to an allegation that “the insurance

company wrongfully delayed his receipt of compensation benefits,” the Court

concluded that “the employee was limited to the remedies provided within the

framework of the” WCA. Id. at 1287, 1288.

The Court in Franczyk also cited this Court’s decision in Santiago v.

Pennsylvania National Mutual Casualty Insurance Co., 613 A.2d 1235

(Pa.Super. 1992). There, this Court relied on Kuney II to hold that the WCA’s

exclusivity provision barred an employee’s suit for an insurer’s bad faith in

settlement negotiations, as “completely intertwined with the original injury.”

Id. at 1243.

The Franczyk Court synthesized these cases and concluded that the

employee’s “asserted injury” there was likewise “‘intertwined’ inextricably with

the workplace injury.” Franczyk, 2023 WL 2992700, at *8. The Court

explained that allowing the suit would necessitate a “trial within a trial” of the

underlying claim against the dog owner, in effect requiring the employer

defendants “to litigate precisely the sort of claim that the WCA is supposed to

prevent.” Id. The Court added that the trial court would also likely have to

consider the effect of the employer’s subrogation right on any recovery in the

underlying suit, as well as whether to reduce accordingly any verdict against

the employer. Id. The Court acknowledged Martin, which it said “arguably

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softened” Kuney II’s holding. Id. at *8 n.50. The Franczyk Court to pains

to clarify, however, that it did not “aim to abrogate Martin,” adding that it did

“not presume to anticipate or foreclose claims arising in future cases that an

appellate court finds more like Martin than Kuney II or this case.” Id.

Guided by Franczyk, I would conclude that this case is “more like

Martin than Kuney II.” The injuries here are “truly separable” because in

this case we are faced with a lawsuit between strangers to the employment

relationship for fraudulent conduct to evade payment of bills. Elite Care has

sued for Appellants’ failure to pay for medications that patients/employees

undisputedly received, by alleged use of a fraudulent scheme. The suit is not

for the unpaid bills themselves, “but rather for the distinct (and preventable)

aggravation of the original injury”—the alleged fraudulent scheme to avoid

paying the bills.

Furthermore, Franczyk’s concerns about the employer becoming

embroiled in the sort of litigation the exclusivity provision seeks to prevent

will not occur here. No “trial within a trial” will be necessary, the insurer’s

subrogation rights will not come into play, and nothing will draw the employer

into the litigation. I would affirm on the foregoing basis and respectfully

concur.

Murray, J. joins this Concurring Opinion.

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