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“When the walls come tumblin’ down” – The Case of Applied Materials and the Effect of Treater Misconduct.
On June 1, 2021, The Court of Appeals for the Sixth Appellate District found an injured worker’s Post Traumatic Stress Disorder (“PTSD”) from a sexual relationship with her primary treating physician to be a compensable consequence of her worker’s compensation case. However, the WCJ and WCAB did not have substantial evidence to find that Applicant was permanently Totally Disabled on a psychiatric basis.
Case: Applied Materials, et al v. Workers’ Compensation Appeals Board and D.C. H047148; ADJ1351389, ADJ7168611; and ADJ718359, 06/01/2021, certified for publication.
Facts: This is a complicated case involving three dates of injury; two workers’ compensation carriers; multiple, overlapping body parts; compensable consequence injuries; 16 years of treatment; at least 26 medical-legal evaluations, and different QMEs in the same specialty associated with the different carriers’ claims.
D.C. (Applicant) worked for Applied Materials from 1996 until January 15, 2008. She claimed three injuries while working for the employer:
1) A November 2001 specific injury to the right upper extremity and cervical spine. This claim was accepted. The carrier for the date of injury was Arrowood Indemnity Company (“Arrowood”). In 2011, application amended to allege an injury to the psyche.
2) A May 2005 specific injury to the bilateral upper extremities and cervical spine. This claim was denied. The carrier for the date of injury was XL Specialty Insurance Company (“XL Specialty”).
3) A cumulative trauma injury ending on January 15, 2008, to the bilateral upper extremities, cervical spine, and psyche. This claim was also denied. The carrier for the date of injury was XL Specialty.
In April 2006, Applicant complained to her treating orthopedist that she was depressed secondary to her industrial injuries. Applicant was referred for treatment of her psychiatric complaints.
Throughout 2001 to January 2008, Applicant complained of worsening pain to the right upper extremity and neck, new pain to the left upper extremity, continued to work at various times with regular duties or modified duties, and had periods of temporary total and temporary partial disability.
From 2007 through December 2013, Applicant treated with Dr. John Massey for her multiple workers’ compensation injuries. Per Applicant, in 2012, Dr. Massey began making sexualized comments and inappropriate physical contact with her during her treatment appointments. In May 2013, Dr. Massey went to Applicant’s home and initiated sexual relations. Applicant stated that she initially told Dr. Massey that she did not date married men, did not want to have sex with him, and thought it was “weird” because he was her doctor. However, when Dr. Massey led Applicant to her bedroom to have sexual intercourse, she did not resist his advances. Applicant and Dr. Massey had sexual intercourse on five occasions between May 22 and June 25, 2013, at Applicant’s home. Dr. Massey went to Applicant’s house an additional six times between July 14, and October 10, 2013, asking Applicant to have sex. On those occasions Applicant refused. Additionally, Dr. Massey called Applicant more than 70 times between May and November 2013.
During this time, Dr. Massey controlled Applicant’s treatment. He also controlled her disability benefits. Additionally, he controlled Applicant’s medications: prescribing her six medications; narcotic and neuropathic pain relievers, a potent opioid, a hypnotic for insomnia, an anti-depressant, and a psychotropic for anxiety.
In April 2011, Applicant was evaluated by XL Specialty’s psychiatric QME Dr. Allen Sidle. Dr. Sidle determined Applicant sustained an industrial psychiatric injury that was predominantly caused by the cumulative trauma injury. Applicant was over medicated and suffering from suicidal ideation and needed immediate psychiatric treatment. Applicant was not permanent and stationary and would not be stabilized until an effective medication regimen was implemented. Once Applicant reached permanent and stationary status apportionment to non-industrial conditions would be considered. Applicant had an abusive childhood, alcoholic parents, and a failed relationship with the father of her child.
In January 2014, Dr. Sidle re-evaluated the Applicant. Dr. Sidle determined Applicant was psychiatrically temporarily totally disabled on an industrial basis due to Dr. Massey’s behavior. Again, Dr. Sidle indicated that when Applicant became permanent and stationary apportionment to non-industrial stressor would be appropriate.
In May 2014, Applicant reported Dr. Massey to the Medical Board of California. Applicant’s complaints were investigated by BAPWC, the police, and the Medical Board. Applicant reported to Dr. Sidle that the investigation was very stressful.
In March 2015, Dr. Sidle re-evaluated Applicant. He found that Applicant’s psychiatric condition was worsening. He opined that Applicant’s cumulative trauma ending in 2008 was the predominant cause of her psychiatric injury, her psychiatric injury was a compensable consequence of the accepted orthopedic injuries, and that there was additional exposure due to the inappropriate behavior of Dr. Massey.
In January 2016, Dr. Sidle determined Applicant was permanent and stationary. He further opined that Applicant had PTSD due to the interactions with Dr. Massey and that Applicant’s PTSD was 100% industrial because Dr. Massey was Applicant’s physician for the workers’ compensation injuries. Dr. Sidle assigned Applicant a GAF score of 45 which equates to 40% whole person impairment. Dr. Sidle understood a GAF score of 45 to mean that Applicant “could not hold a job” and determined that she should be considered totally disabled. He opined that Applicant was 100% permanently disabled based on her psychiatric condition alone and was unable to work. He further found Applicant was not able to meet the demands of an employer on a steady basis eight hours a day, five days a week. Finally, Dr. Sidle determined that the psychiatric injury was inextricably intertwined with all three dates of injury because Dr. Massey was treating Applicant for injuries related to all three dates of injury.
Procedural History: In June 2005, Applicant initially settled her 2001 case by Stipulation with Request for Award. In October 2006, Applicant filed a timely petition to reopen the 2001 Stipulation with Request for Award. In 2011, Applicant amended the Application for Adjudication to allege an injury to the psyche.
The matter proceeded to Trial on the merits. The WCJ found that Applicant sustained specific injuries on November 27, 2001, and in May 2005, as well as a cumulative trauma injury ending on January 15, 2008, to the neck, bilateral arms, and psyche. The WCJ further found that Applicant was 100% permanently disabled due to the psychiatric injury alone based on the reporting of Dr. Sidle and the defendants were joint and severely liable for the psychiatric injury as the impairment was inextricably intertwined with all three dates of injury.
Both Defendant’s and Applicant petitioned for reconsideration. The Appeals Board granted reconsideration amending the amounts of the weekly temporary and total disability benefit rates, made orders regarding the attorney fees, and otherwise affirmed the Award.
Defendants petitioned for review. Between the defendants, 10 issues were raised.
Analysis of Issues After Review:
1. XL Specialty asserted the proper date of injury for the cumulative trauma was in 2002 (before its coverage) asserting there was a convergence of Applicant’s knowledge that she sustained a cumulative trauma injury and disability.
The court acknowledged that under L.C. §5412 the date of injury for a cumulative trauma is the date on which there is a convergence of knowledge of an industrial injury and disability, or the last date on which the employee was employed in an occupation exposing her to the hazards of the cumulative trauma, whichever comes first. However, based on Western Growers Ins. Co. v. Workers’ Comp. Appeals Bd. (1993) 16 Cal.App.4th 227 (Western Growers), it is also understood that specific and cumulative trauma injuries can arise from the same or separate events. It is up to the court to decide based on the facts of the case whether the new disability is due to an old injury or a new and separate injury. Since Applicant continued to work for the employer and complained of worsening symptoms and injury to additional body during her continued employment through the last date on which Applicant worked, there was sufficient evidence to find Applicant sustained a cumulative trauma injury ending on January 15, 2008.
2. Both Defendants argued that Applicant’s psychiatric disability was not industrially related because Applicant broke the causal chain by engaging in a personal relationship with Dr. Massey outside of the medical setting.
Under Business and Professions Code §729(a) & (b), physicians who engage in sexual intercourse or sexual contact with the patient are guilty of the criminal offense of sexual exploitation. Moreover, the patient’s consent is not a defense.
Citing South Coast Framing, Inc. v. Workers’ Comp. Appeals Bd. (2015) 61 Cal.4th 291, 297-298; and Fitzpatrick v. Fidelity & Casualty Co. (1936) 7 Cal.2d 230, 232 the court reiterated that employment need only be a contributing cause without which the injury would not have occurred; and it is settled law that an aggravation or injury resulting from treatment or examination of an industrial injury is compensable.
The court found that, but for Dr. Massey’s position as Applicant’s treating physician for the industrial injuries, he would not have had the same access and power over Applicant to initiate the sexual relationship. Dr. Massey’s sexualized comments began during Applicant’s medical appointments in 2012. Moreover, Dr. Massey was a member of Arrowood’s MPN; the treatment was authorized and paid for by Arrowood and should have been authorized by XL Specialty; and subjected to Utilization Review
3. XL Specialty argued it should not be jointly and severely liable for the permanent disability caused by Dr. Massey’s sexual exploitation of Applicant because Arrowood provided and paid for the treatment.
When discussing whether the psychiatric disability was causally connected to Applicant’s employment, the court stated, “An employee is entitled to compensation for a new or aggravated injury that results from the medical treatment of an industrial injury, whether the doctor was furnished by the employer, insurance carrier, or was selected by the employee.” (Hikida v. Workers’ Comp. Appeals Bd. (2017) 12 Cal.App.5th 1249, 1262 (Hikida) citing Fitzpatrick v. Fidelity & Casualty Co., supra, 7 Cal.2d at p. 232.)
The court rejected XL Specialty’s argument stating liability cannot be avoided by denying a claim and refusing to furnish benefits. Per the QMEs, Applicant suffered three dates of injury. Although Arrowood authorized the treatment by Dr. Massey for the 2001 date of injury. Most of the treatment rendered by Dr. Massey occurred after Applicant’s 2005 specific and 2008 cumulative trauma injuries covered by XL Specialty. Therefore, Applicant was treating with Dr. Massey for all three dates of injury and XL Specialty’s argument has no merit.
4. XL Specialty argued Arrowood’s orthopedic AME Dr. Feinberg supplemental reporting issued in 2017 was not substantial medical evidence regarding causation because he did not re-evaluate Applicant after 2011.
For his initial evaluation in 2011, Dr. Feinberg reviewed 10 inches of medical records covering the period from 1989 through 2011. He reviewed an additional 2.5 inches of records for the 2017 supplemental reports. While Dr. Feinberg’s opinions regarding permanent disability and apportionment changed based on the review of additional records, his opinion regarding causation remained the same. As Applicant had not worked for the employer since 2008, Dr. Fienberg had all the information he needed to make a determination regarding causation at the time of his 2011 evaluation. Lack of a re-evaluation in 2017, did not render his reporting insubstantial medical evidence as to causation.
5. Arrowood argued that there was not substantial evidence to support a finding that Applicant sustained a psychiatric injury as a result of the 2001 specific injury.
The Court of Appeals disagreed pointing out that Applicant began complaining of depression in April 2006. Moreover, Arrowood provided treatment with psychologists and psychiatrists before Applicant petitioned to reopen the Stipulation with Request for Award for new and further injury.
In 2011, the treating physicians found Applicant’s pain disorder, depression, and anxiety were consequences of Applicant’s physical injuries due to the 2008 cumulative trauma, not the 2001 specific injury.
However, the nature of the psychiatric injury changed in 2013 when Applicant suffered PTSD as a result of Dr. Massey’s sexual exploitation of Applicant. QME Dr. Sidle found that 100% of Applicant’s permanent disability was caused by the PTSD resulting from the sexual exploitation. As Dr. Massey was treating Applicant for all three dates of injury, QME Dr. Sidle determined that the impairment was inextricably intertwined with the three dates of injury. (See Benson v. Workers’ Comp. Appeals Bd. (2009) 170 Cal.App.4th 1535, 1560.) [Also, discussed below at point 9.]
Furthermore, Arrowood was authorizing Dr. Massey’s treatment and Dr. Massey was in Arrowood’s MPN. Therefore, there was sufficient evidence to find the treatment events for all three dates of injury caused the psychiatric permanent disability.
6. Arrowood argued that there was not substantial evidence to support a finding that Applicant sustained a new and further disability within five years of the 2001 date of injury.
Arrowood argued that under Sarabi v. Workers’ Comp. Appeals Bd. (2007) 151 Cal.App.4th 920, 925 (Sarabi), a petition to reopen needs to be timely, and an applicant must have sustained new and further disability within the five-year limitations period.
Petitions to reopen are governed by two statutes:
First, Labor Code § 5410 allows an injured worker to “institute proceedings for the collection of compensation within five years after the date of injury upon the ground that the original injury has caused new and further disability.”
Second, “[s]ection 5803 permits the reopening of a previously adjudicated case for ‘good cause’ upon a petition filed by [any] party, also within five years from the date of injury. If a petition to reopen under either section is filed within the five year period, the [WCAB] has jurisdiction to decide the matter beyond the five year period.” (Sarabi, supra, 151 Cal.App.4th at p. 925, italics added.)
To recover benefits Applicant must have filed a timely petition to reopen and have suffered “new and further disability” within that five-years, unless there is “good cause” to reopen the prior award.
As previously discussed, in April 2006, Applicant began complaining of depression. In March 2006, Applicant was referred to a psychologist for pain management. In July 2006, Applicant was diagnosed with psychological pain disorder and sleep disorder. In August 2006, a physician requested authorization to treat Applicant’s depression. In September 2006, medication was prescribed to for severe anxiety and Applicant was referred for psychotherapy. Arrowood authorized and voluntarily paid for the treatment pursuant to the open medical award on the 2001 claim.
Based on the timeline of psychological complaints and treatment, there was substantial evidence available supporting the WCJ’s finding of new and further disability from the 2001 injury.
On another note, the court points out that Arrowood did not distinguish between the depression and anxiety that were compensable consequences of the physical injuries, and the PTSD that was a compensable consequence of Dr. Massey’s sexual exploitation. Arrowood specifically argued against liability for the 2013 PTSD during oral arguments. The Court of Appeals found that the argument was waived because it was not raised in the briefing.
7. Arrowood argued that Dr. Sidles reporting is not substantial medical evidence as to the 2001 date of injury because he did not evaluate Applicant’s impairment in terms of the eight work functions as required to rate psychiatric disability under the 1997 schedule.
The 1997 permanent disability Schedule applies to claims arising before January 1, 2005. Labor Code §4660(d) provides three exceptions by which the 2005 PDRS Schedule applies to earlier claims. The 2005 Schedule “shall apply to the determination of permanent disabilities when”:
1) there has been no comprehensive medical-legal report indicating the existence of permanent disability;
2) there has been no report by a treating physician indicating the existence of permanent disability; or
3) when the employer is not required to provide the notice required by §4061.
In considering Arrowood’s argument, the court determined that while there was finding of permanent disability with regard to Applicant’s orthopedic injuries prior to January 1, 2005, there was not a psychiatric injury before January 1, 2005.
The court cited New United Motor Manufacturing, Inc. v. Workers’ Comp. Appeals Bd. (2007) 72 Cal.Comp.Cases 1678 (NUMMI), in which an injured worker alleged a cumulative trauma injury through November 2002 to his low back and hearing, was found permanent and stationary by his treating physician for his low back injury alone in April 2004, and subsequently alleged an additional cumulative trauma injury. The parties agreed to utilize an AME, who found Applicant sustained a single cumulative trauma injury through the last day worked in November 2004. In that case, the WCJ determined that a finding of permanent disability to one body part was sufficient to trigger a 4660(d) exception and applied the 1997 Schedule.
The Court of Appeals distinguished NUMMI from this case pointing to the specific language of 4660(d) which states the 2005 Schedule “shall apply to and govern only those permanent disabilities that result from compensable injuries received or occurring on and after the effective date of the adoption of the” 2005 Schedule. Since the compensable psychiatric injury occurred after January 1, 2005, and the medical reports finding psychiatric disability issued after January 1, 2005, the 2005 Schedule should apply.
8. Arrowood argued that the WCAB erred in awarding 100% permanent disability based on the PTSD psychiatric impairment for three reasons:
1) Under the 2005 rating schedule Applicant was assigned a GAF score of 45, equating to 40% WPI, which rates to 70% permanent disability.
The Court of Appeals noted that some WCJs and the WCAB have been taking an “alternate path” approach to find an injured worker is permanently totally disabled based on L.C. §4662(a) which outlines the four bases for presumptive permanent total disability; and L.C. §4662(b) which states, “In all other cases, permanent total disability shall be determined in accordance with the fact.”
However, the “alternative path” approach was rejected by the Court of Appeals in Department of Corrections & Rehabilitation v. Workers’ Comp. Appeals Bd. (2018) 27 Cal.App.5th 607, 612 (Fitzpatrick).
Here, Dr. Sidle assigned Applicant a GAF score of 45. The 2005 Schedule describes the 40-50 GAF Scale range as “Serious symptoms (e.g., suicidal ideation, severe obsessional rituals, frequent shoplifting) OR any serious impairment in social, occupational, or school functioning (e.g., no friends, unable to keep a job). Dr. Sidle determined that a GAF score of 45 meant Applicant could not hold a job and was therefore totally disabled. However, a GAF score of 45 equates to 40% permanent disability, which rated to 68% to 70% permanent disability after considering diminished earning capacity, age, and (depending on) the date of injury.
Applicant argued that a GAF score of 45 means that she cannot hold a job and that a finding of 100% permanent disability is mandated when a psychiatric QME finds an injured worker cannot work.
The court rejected Applicant’s argument stating that had Dr. Sidle assigned Applicant a GAF score of 29 or lower Applicant’s impairment would have rated to 100% using the rating schedule. Moreover, since Dr. Sidle’s opinion that Applicant was 100% permanently totally disabled was based on an incorrect legal theory, his opinion does not constitute substantial evidence to support the award. (E.L. Yeager Construction v. Workers’ Comp. App. Bd. (2006) 145 Cal.App.4th 922, 928, citing Hegglin v. Workmen’s Comp.App.Bd. (1971) 4 Cal.3d 162, 169.)
Relying on Fitzpatrick, the court reiterated that the rating schedule is prima facie evidence of an injured worker’s permanent disability and implied the rating schedule is “the fact” by which permanent total disability should generally be determined since permanent disability can reach 100% when the impairment is rated or combined using the Schedule. Furthermore, an injured worker still can rebut the rating schedule in accordance with LeBoeuf.
2) Dr. Sidle was not qualified to opine that Applicant could not compete in the open labor market since he was not a vocational expert.
“The WCAB has held that the role of the medical evaluator in workers’ compensation cases is to assess work restrictions and resulting impairment.” (Blackledge v. Bank of America (2010) 75 Cal.Comp.Cases 613, 619 621 [WCAB en banc].)
“In Merino v. Workers’ Comp. Appeals Bd. (2001) 66 Cal.Comp.Cases 405, 406 (writ denied), the WCAB held that while it is proper for a doctor to give an opinion on whether an injured worker can perform his or her usual and customary duties, opinions about “ ‘competing in the open labor market’ ” are beyond the doctor’s expertise, and must be left to a vocational rehabilitation specialist.” [Italics added.] In Merino, the court went on to say that the vocational expert evidence, as well as, medical evidence is needed to rebut the Schedule and it is improper for a doctor to believe an injured is worker unable to return to the active labor market and deem the worker 100% permanently disabled based on that belief.
While Dr. Sidle indicated in his reporting that Applicant would not be able to work “eight hours a day, five days a week,” he did not consider part-time or in-home employment, other alternative work settings, retraining options, or Applicant’s ability to participate in vocational rehabilitation.
Since Dr. Sidle is not a vocational rehabilitation expert, he was not qualified to determine Applicant was 100% permanently disabled because she was unable to return to the active labor market.
3) Dr. Sidle’s testimony was insufficient to rebut the rating schedule.
Defendants asserted that there was no evidence introduced at Trial that would rebut the scheduled rating. Conversely, Applicant asserted that she did not have to rebut the schedule because the scheduled rating was 100%.
Having found that Applicant’s psychiatric disability rated to 68% or 70% based on the date of injury under the scheduled rating, the court agreed that the burden to rebut the scheduled rating is placed on the party challenging the scheduled rating.
Under LeBoeuf v. Workers’ Comp. Appeals Bd. (1983) 34 Cal.3d 234 (LeBoeuf) there are three ways to rebut the schedule:
1. A party shows a factual error in the application of a formula or the preparation of the schedule.
2. The injury impairs the employee’s rehabilitation, and for that reason, the employee’s diminished future earning capacity is greater than reflected in the scheduled rating.
3. The employee can demonstrate that the nature or severity of the injury was not captured within the sampling of disabled workers that was used to compute the adjustment factor.
The WCAB has explained that to properly rebut a permanent disability rating, “a physician is expected to:
1. provide a strict rating per the AMA Guides;
2. explain why the strict rating does not accurately reflect the employee’s disability;
3. provide an alternative rating within the four corners of the AMA Guides; and
4. explain why the alternative rating most accurately reflects the employee’s level of disability.” Golden Gate Bridge, Highway & Transportation Dist. v. Workers’ Comp. Appeals Bd. (2018) 83 Cal.Comp.Cases 1704, 1706 (writ denied); see also Milpitas Unified School Dist. v. Workers’ Comp. Appeals Bd. (2010) 187 Cal.App.4th 808, 828-828 (Guzman).
While Dr. Sidle provided a strict rating per the AMA Guides; he did not explain why the equivalent 40% whole person impairment did not accurately reflect Applicant’s disability, provide an alternative rating, or explain why the alternative rating more accurately reflected Applicant’s disability.
As such, Dr. Sidles’ testimony and reporting was not sufficient to rebut the rating schedule and Applicant did not meet her burden.
9. Arrowood argued that apportionment should be considered on remand.
The court found that the issue was moot since it was annulling the WCAB’s decision and remanding for further proceedings. However, the court reminded that in Benson v. Workers’ Comp. Appeals Bd. (2009) 170 Cal.App.4th 1535, 1541, fn 3 (Benson), the court has acknowledged that there may be circumstances in which an evaluating physician is unable to apportion causation between various injuries. In such circumstances, an injured worker is entitled to an undivided award for the combined permanent disability because the defendants did not meet their burden of proof on the issue of apportionment.
10. Arrowood argued that the WCAB ordered total permanent disability at the wrong weekly rate for the 2001 date of injury and erred in directing Arrowood to administer the Award.
The WCAB ordered total permanent disability starting on October 7, 2010, at the rate of $916.33 per week, subject to statutory cost-of-living adjustments. Arrowood argued that the permanent disability for the 2001 injury has a permanent disability rate of $490.00 per week and sought an adjustment for the permanent disability rate for 2001 date of injury.
The court found this argument was waived because Arrowood had not raised the issue in either of its petitions for reconsideration.
Arrowood also argued that since the WCAB ordered total PD at the 2008 rate, XL Specialty should be the administering party since XL Specialty was the carrier for the 2008 date of injury.
Again, the court found this argument was waived because Arrowood had not raised the issue in either of its petitions for reconsideration. The court also found that there was no statute or case law on point in support of the argument.
The Applied Materials case is a history of worker’s compensation theory and application since 1983 starting with Le Boeuf, then Western Growers and going through Hikida and resting with Fitzpatrick. The bottom line is that the system failed this injured worker by having an unprofessional physician handle the treatment for this applicant; the rest is left for history.
By Nicol Harper, Associate Attorney, Riverside Office, October 2021.