By Jeff Birren
The California Court of Appeal has informed professional sports teams that few things are permanent when it comes to California’s workers compensation laws. Case in point — Durand Macklin v. New York Knicks, Atlanta Hawks and Los Angeles Clippers.
The Facts and Proceedings Below
Durand (Rudy) Macklin played for the Knicks, Hawks, Clippers, and a minor league team from August 1981 to October 1984. He played in California as a member of the Atlanta Hawks on three occasions, and received treatment for his back with the club during this time. While employed by the Knicks, he played in a game in California on November 5, 1983, and practiced before games on three other days later that year. He signed with the Clippers in June 1984 and was released on October 24, 1984. He testified that he did not learn about his right to file a workers compensation claim until 2011; his claim was subsequently filed in California on August 24, 2011.
The workers compensation judge (“WCJ”) found that there was jurisdiction over all three teams, and rejected defenses based on the one-year statute of limitations and laches because the defendants had failed to give Macklin notice of his right to file a claim. Macklin was found to be 76% disabled. The Workers Compensation Appeals Board (“WCAB”) affirmed. The WCAB found that his time with the Clippers, along with the games played in California, made his connection to the state more than de minimis, and as a result there was no denial of due process in subjecting the non-California teams to California jurisdiction and allocating liability among those teams.
The Knicks Filed a Writ Petition in the Court of Appeal.
The Knicks filed a writ in the Court of Appeal, seeking to overturn the WCAB decision (Durand Macklin v. New York Knicks, California Court of Appeal, No. B262759, October 1, 2015). The Knicks claimed that Macklin had no connection to California, no injury in California, and that his time in California with the Knicks was de minimis and therefore did not create subject matter jurisdiction over the Knicks (Id. at 5). However, the writ got off to a very bad start because counsel failed to verify it. Macklin objected to the writ on that basis, and also claimed that the Knicks were forum shopping because the writ was filed in the Second Appellate District, and not the Fourth; the district where the original claim had been filed. This, claimed Macklin, was because the Second Appellate District had decided a prior case, Federal Ins. Co v. WCAB, Adrienne Johnson (221 Cal. App.4th 1116 (2013)) and thus the petitioner was forum shopping as Johnson would be binding on that District.
The Enthralling Issues of Writ Procedure
The opinion is less than twelve pages, and almost three pages are spent on the spellbinding question of whether petitions for writs must be verified. To end the suspense, the Court of Appeal held that writs must be verified. It is impossible to know how this issue impacted the ruling on the merits. The court was not impressed that counsel for the Knicks did not file a verification until after oral argument. However, it is possible that the court granted the writ primarily to deal with this issue, and not the merits. Future unverified petitions are likely to be dealt with far more harshly. Macklin is a published decision and counsel seeking writ review will not be able to avoid its holding.
The court also held that an insurance company is required to file a writ in the district of the petitioner’s residence, or if that is not possible, in the district of the petitioning carrier’s residence. The Knicks was the third-party administrator, located in Culver City, California, and it was therefore permissible for the Knicks to file the writ in the Second Appellate District. With those breath-taking civil procedure issues out of the way, the Court turned to the merits on page nine of its twelve-page decision.
The Court of Appeal Affirms on the Merits
The Knicks claimed that there was no California subject matter jurisdiction over them, based on Johnson. Ms. Johnson had played a single basketball game in California during her last year of employment, and the Court of Appeal held there was no subject matter over the claim (For a more complete discussion of Johnson, see Sports Litigation Alert, Volume 12, Issue 20, “Golden State, Golden Payments” Part 3). Since Mr. Macklin had, like Ms. Johnson, played a single game in California for an out of state team during his last year of employment, surely there was also a lack of subject matter over the Knicks, or so the writ petition claimed. However, this is California workers compensation, where the twists and turns in the law resemble California Route 1 at its most convoluted.
The court began its analysis by stating that the WCAB’s “findings of fact, even ultimate facts, are conclusive and not subject to review (Lab. Code § 5953) if supported by substantial evidence” (Citations omitted). Moreover, the reviewing court “may not hold a trial de novo, take evidence or exercise independent judgment” (Lab. Code § 5952). The Appeal Board’s interpretation of the Workers Compensation Act is reviewed de novo, but such interpretation by the Appeals Board is entitled to deference (Citations omitted) (Macklin, at 9. See also Cal. Lab. Code § 5952).
The Court then turned to its discussion of Johnson. It quoted the factors set out in Johnson that determine whether or not California has a sufficient relationship with the injuries to make it proper to assert California jurisdiction: (a) if the injury occurred in California, (b) if the employment is primarily based in California, (c) if the employer supervised the activities in the state, (d) if the state is the one with the most significant relationship with the contract of employment, (e) if the parties have agreed that the rights should be determined under the laws of the state, or (f) if the state has some other reasonable relationship to the occurrence, the parties and the employment (Johnson, 221 Cal. App.4th at 1126-1127).
The Court then distinguished Johnson because Mr. Macklin, unlike Ms. Johnson, “played for a California team for a portion of the period of cumulative injury” (Macklin at 11). The court noted that Mr. Macklin had played games in California during prior years for out of state employers, but stated that because he has played for the Clippers during his last year of employment, “[w]e do not have to determine of the other activities on California are sufficient by themselves to make the application of California’s workers’ compensation laws reasonable, although those activities are more than the one game that Johnson concluded was de minimis” (Id).
In doing so the court did not reach the question of whether there was jurisdiction over the Atlanta Hawks. The workers’ compensation judge had held that there was personal jurisdiction over the Hawks (Id. at 4). The Hawks sought review by the WCAB to overturn that portion of the original Findings and Award, but the WCAB had affirmed (Durand “Rudy” Macklin v. Los Angeles Clippers, Atlanta Hawks, Insurance Company of North America and New York Knicks, WCAB Case. No ADJ7993918, February 5, 2015). Thus the Clippers, Knicks and Hawks all remain in the case.
The Knicks argued that Macklin’s single game played in California for the Knicks was de minimis. It therefore should not matter that a California club hired Macklin during his last year of employment, and thus there should be no subject matter jurisdiction over the Knicks. The Court disagreed, stating that California employment during the last year “is sufficient in this case to make reasonable the application of the California workers’ compensation law” (Id.). For cumulative trauma claims, liability “is limited to employers who employed Macklin during one year immediately preceding either the date of the injury or during the one year preceding the last date on which the employee was employed in the occupation that exposed him to the hazards of cumulative injury, whichever first occurred” (Id. at 11-12). The Knicks’ liability “is predicated on the fact that petitioner was Macklin’s employer during that one year period” (Id. at 12). The allocation of liability is not the same as determining whether California can apply its workers’ compensation laws to Macklin’s injuries.
The Knicks were also arguing that Johnson held that there was not jurisdiction over the Knicks. Yet Johnson was based on due process and not traditional jurisdiction analysis. The Johnson court found that California did “not have a sufficient relationship with Johnson’s injuries to make the application of California’s worker’s compensation laws reasonable…Thus as a matter of due process, California does not have the power to entertain Johnson’s claim” (Johnson, 221 Cal.App.4th at 1131). This could not have escaped the author of Macklin as he had also written the Johnson opinion.
The Court stated its precise holding on page two of the opinion: “we hold that California has a legitimate interest in an industrial injury when the applicant was employed by a California corporation and participated in other games and practices in California for non-California teams during the period of exposure causing cumulative injury. Subjecting petitioner to California workers’ compensation law is reasonable and not a denial of due process” (Id. at 2).
In this case the Atlanta Hawks will also share in the allocation since they had not challenged the WCAB ruling that they were also liable.
In footnote 8, the court stated that its opinion “only applies to claims filed by professional athletes prior to September 15, 2013” (Stats. 2013, ch. 653 § 1.). Further, the court “express[ed] no opinion as to the effect on claims filed by professional athletes after that date” (Id at 11). Note: The court was referring to AB 1309, a workers compensation reform bill that was passed in 2013 and that only applies to certain professional sports activities, and took effect on September 15, 2013. To date no Court of Appeal or Supreme Court decision has reached any portion of that legislative act.
The Court of Appeal ended the opinion by remanding the case to the WCAB “for the purpose of awarding respondent Macklin his reasonable attorney fees for services rendered in connection with the petition for writ of review” (Lab. Code § 5801) (Id. at 12).
Going Forward After Macklin
The Macklin decision establishes several principles that are now binding on California claims. The first is that if there is employment by a California club during the last year of employment, California has a sufficient relationship to the claim and it is not a violation of due process to proceed with the case.
Furthermore, if there is a California club and a non-California club in the last year of employment, a single game played in California, or perhaps a single practice in California, courts will keep non-California clubs in the case and liability will be allocated to all such clubs. The court did not address the Atlanta Hawks as they had not filed a writ petition, but the WCAB did find that they were also liable.
It is also worth noting that once again the WCJ rejected defenses based on the one-year statute of limitations and laches, because none of the employing-clubs gave Macklin notice of his right to file a workers compensation claim for cumulative trauma, the DWC-1 form (Cal. Labor Code § 5412) (See Sports Litigation Alert, Volume 11, Issue 23, December 12, 2014, “Golden State, Golden Payments” Part One). In the absence of a DWC-1 mentioning cumulative trauma, the sun never sets on claims as there is no statute of limitations defense and no laches defense, unless there is contemporaneous written documentation that demonstrates that the Applicant had actual knowledge of the right to file a workers compensation claim, and that is far from certain to work. Many claims by professional athletes have involved hundreds of thousands of dollars, thus making the failure to give a single page with the words “cumulative trauma” an extremely expensive act.
Every major league sports team plays games in California. No team can ever be sure when it releases players that they will subsequently sign with a California team, and thus create the Macklin scenario. What clubs can do it give players the correct notice of the right to file a cumulative trauma claim.
Decisions by the Court of Appeal are binding on every workers compensation judge and the WCAB, but the Macklin court has served notice that the WCAB has great latitude to determine the facts and apply the law, and that only purely legal issues can be taken up to the Court of Appeal by writ. With this judicial valentine in place, insurance companies and employers will inevitably face a steep uphill climb to overturn decisions by the WCAB.
Both applicants and their former employers need to think carefully about filing writs seeking review of WCAB opinions. There are specific procedural requirements that must be met, applicants must take account of the fact that both the statutes and case authority give the WCAB great latitude in establishing the facts and great deference in construing the law, and that applicants should ensure that they are properly citing opinions. Loose language when referring to prior decisions is never helpful. If bad facts can make bad so, so, too, can bad.
Mr. Birren is a frequent contributor to Sports Litigation Alert.
