Wise v. Swift Transportation Co., Inc. et al

Filing 276

ORDER: Granting Plaintiff's Motion for Partial Summary Judgment 166 ; and Denying Defendants' Motion to Strike 270 . The parties' requests for oral argument are denied as unnecessary. Signed on 03/10/2011 by Chief Judge Ann L. Aiken. (lg)

Wise v. Swift Transportation Co., Inc. et al

Doc. 276

IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF OREGON KARL WISE, Plaintiff, vs. SWIFT TRANSPORTATION CO., INC., a foreign corporation; INTERSTATE IPMENT LEASING INC., an Arizona ration; BRUCE MARK PISTONE, Defendants. Civil No. 07-6342-AA OPINION AND ORDER

Arthur C. Johnson Derek C. Johnson Michele C. Smith Johnson, Clifton, Larson & Schaller, P.C. 975 Oak Street, Suite 1050 , Oregon 97401 3176
Attorneys for aintiff
Frank A. Moscato JoLynn G. McCulloch C. Robert Steringer
Harrang Long Gary

ck P.C.

Dockets.Justia.com

1001 SW Fifth Ave., 16 th Floor Portland, Oregon 97204 Att for fendants AIKEN, Chief Judge: Plaintiff Karl Wise moves for partial summary judgment pursuant to second affirmat

R. Civ. P. 56 for dismissal of
defense.

fendants'

Intervenor Transguard Insurance Plaintiff's

Company of America, Inc. joins plaintiff's motion. motion is granted.
BACKGROUND

Plaintiff filed suit against defendants Bruce Interstate ipment Leasing, Inc. ft) (IEL), and Swift

stone,

Transportation Co., Inc.

for

rsonal injuries arising

out of a tractor-trailer accident that occurred on February 10, 2007, near Pendleton, Oregon, on Interstate 84. Plaintiff filed alized

a workers' compensation claim against his employer, Transportation, Inc.

("STI"), who is covered by Transgaurd ("Transguard"). Transguard

Insurance Company of America, Inc.

has paid out approximately $1 million in benef to payout benefits for Temporary Total expenses associated with the accident.

s and continues

sability and medical

Plaintiff has requested $13,500,000 in damages from defendants. Defendants filed a ird-party complaint against ng ity third-

third-party defendants STI and Steven Murray, aIle and contribution.

In December 2009, this Court grant

party defendants' motion for summary judgment finding they were immune from liability cont ion indemnity by operation In November 2010, this

of Nevada's workers' compensation law.

Court granted third-party defendants' motion judgment of

entry of

smissal pursuant to Fed. R. Civ. P. 54(b), and defendants STI and Steven Murray from this

dismissed third-pa lawsuit.

Subsequently, plaintiff filed a motion for partial summary judgment on defendants' that first a rmative defense, which alleged uries. In

intiff's negligence contributed to his

January 2011, this Court granted the defense. By court order,

aintiff's motion and dismissed fendants were allowed to amend as

their answer to add a second affirmative defense identifi "Offset under Santisteven v. Dow Chern. Co. De
ell).
1I

(t

"Offset

STANDARD

Summary judgment is

ropr

"if the

eadings, admissions on file,

sitions, answers to interrogatories,

together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." 56 (c) . a fact. Substantive law on an issue determines T.W. Electrical Serv., Fed. R. Civ. P. material y of

Inc. v. Pacific Electrical 630 (9th Cir. 1987). Whether

809 F.2d 626,

evidence is such that a reasonable jury could return a verdict for the nonmoving di e. y determi the authenticity of a 477 U.S. 242, 248

(1986) . ISantisteven v. Dow Chern. Co., 362 F.Supp. 1973); aff'd on other grounds, 506 F.2d 1216 ( 646, 648 (O.Nev. Cir. 1974).

The moving

y has

burden of establishing

absence

of a genuine issue of material 477 U.S. 317, 323. (1986). of a genuine issue of mater If the moving party shows the absence
1 fact,

the nonmoving party must go

beyond the pleadings and identify facts which show a genuine issue for trial. at 324.

ial rules of construction apply when evaluating summary judgment mot (1) all reas doubts as to the existence of resolved against the

genuine issues of material fact should moving rty; and (2) all

rences to be drawn from

underlying facts must be viewed in the light most favorable to t nonmoving party. T.W. Electrical, 809 F.2d at 630.
DISCUSSION

Plaintiff filed a motion for defendants' second affirmative

rtial summary judgment on fense. Defendants allege that

plaintiff's judgment against defendants must be reduced by the amount of wor rs' compensation benefits pa in caus if plaintiff's the dent. is issue.

oyer was in any way negli It is undi

that Nevada law governs

Additionally, it is undi

ed that there is no genuine issue Thus, the only se exists

with respect to any material fact in this case. issue be this Court is whether the Offset De

under Nevada law.
I .

Before analyz Court

the me

s of pI

ntiff's motion, this

ews the relevant legal background concerning workers' Nevada.

compensation

A.

Nevada's Industrial Insurance Act

It is undisputed that provisions of the Nevada Industrial Insurance Act 616. (NIIA) govern this issue. Nev. Rev. Stat. Ch.

The NIIA is interpreted broadly to protect both the loyer nst common law tort actions. The NIIA oyer

employee and

94 Nev. 12, 14, 573 P.2d 1184 (1978). provides the exclusive for workplace of an employee inst his

uries, and limits an empl

r's liability to the

workers' compensation benefits Nev. Rev. Stat.
§

to the injured employee.

616A.020; see also In

Casino, Inc., 117 Nev. 482, 483, 25 P.3d 206 (2001). addition, the NIIA permits the employer

its insured to place d, on

a lien, in the amount of workers' compensation benefits any damages recovered by a plaintiff in an rd-party. B. See Nev. Rev. Stat.
§§
actio~

against a

616C.215(2).(a), 616C.215(5).

Santisteven's Offset Defense' oyee brought a ne igence action r injuries Santisteven

In Santisteven, an against a third-pa which

chemical supplier to recover

sustained in the course of his employment. 362 F.

646, 648 (D.Nev. 1973); aff'd on The supplier filed

~~~~~~~,

506 F.2d 1216 (9th Cir. 1974).

a thi the

rty complaint against plaintiff's employer and joined oyer's workers' compensation insurer as third-pa if liable, defendant "should benefit as a credit against the judgment of

defendant, alleging nevertheless have t

any compensation paid plaintiff by [workers' compensation]" because the employer's negligence was the proximate cause of the

accident.

. at 650. found no Nevada decisions on the ("we s not spoken.

The district court, havi

issue, turned to case law from other jurisdictions. have a problem on which the Nevada Supreme Court

Nor do we find guidance by way of dicta in the state decisions. We cannot find any inte published opinions"). rule from
23~

ation of N.R.S. § 616.560 in the court timately adopted the offset at 651; see Lovette v. Lloyd,
~~~~~~~==,

and Witt.

N.C. 663, 73 S.E.2d 886 (1953);

57 Cal.2d

57, 366 P.2d 641 (1961). concurring

These cases hold that if the employer's loyee's injuries, the insurer's oyee's

lige0ce caused

right of subrogation is eliminated and the amount of recovery is reduced by the amount of compensation paid. Santisteven, 3 C. F.Supp. at 651.

Santi steven was

ided in 1973.

At that t

, Nevada was a

state with contributory negligence.

n 1976, John R. Reiser,

Chairman of the Nevada Industrial Commission (NIC), introduced Senate Bill 12 to the Nevada Legislature in order to clari NIC's subrogation rights in third party actions. the

See Labor and . Sess.

Management Committee Meeting Minutes, S.B. 12, 59th (Nev. 1977). fault. that t

,Nevada had switched to comparat However, NIC rema the

See Nev. Rev. Stat. § 41.141.

sole provider of workers' compensation insurance. In support of the measure, irman Reiser explained that third rty

the Offset Defense "would defeat NIC's lien on

recovery if any negligence could proposed revision . icability of compensation cases." 1977) .

att

ed to the empl

r.

. would specifically deny the

Witt v. Jackson doctrine in Nevada worker's scal Note, S.B. 12, 59th . Sess. (Nev.

Both houses of the Nevada Legislature voted unanimously 11 12 and passed into law on March 26, 1977.

to adopt Senate

As a result, the NIIA was amended to read (amendments italicized) : 1. When an employee coming under the provisions of this er receives an injury for which compensat is pa under this chapter and which injury was caused under circumstances creating 1 1 liability in some person, other than the employer or a r s o n in the same employ, to pay damages in respect thereof: (a) The injured employee. . may take proceedings aga person to recover damages, but the amount of the [workers'] compensation to which the ured oyee . [is] entitled under this chapter shall be reduced by the amount of damages recovered, notwithstanding any act or omission of the employer of a person in the same oy whi was the rect or proximate cause of the injury. 2. In any case where the commission is subrogated to t rights of the injured employee. . as provided in subsection 1, the commission has a lien upon the total proceeds of any recovery from some person other the employer, whether the proceeds of such recovery are by way of judgment, settlement or se. The injured empl . [is] not entit to double recove of the same ury, no thstanding any act or ssion of the employer a person in the same employ which was the rect or proximate cause of the oyees ury. Nev. Rev. Stat. §§ 616.560 (I) (a), 616.560 (2) Stat. II. 616C. 215 (2 ) (a), Analysis Defendants' rely on Santi steven for their second affirmative defense. Plaintiff argues that contradicts Nevada 616C. 215
(1 )

(currently Nev. Rev.

(b) ) .

law and pract

, as well as the policy underlying the NIIA, and ssed.

therefore, defendants' affirmative defense should be

Specifically, his

aintiff contends I

the 1977 legislative

and amendments

itly invalidated the Offset Defense.

As such, the Offset De established by the

se contravenes current Nevada law, that Santisteven has never been followed Further, plaintiff fendants is against See Order and s that

by any Nevada court since the 1977 amendment. all s that

reduction of judgment proposed by ion cl by a rd pa

essenti

ly a contr

immune employer, which this Court has forbidden. Opinion, Dec. II, 2009 (doc. 113).

Plaintiff also a

Nevada does not allow apportionment of fault against non-parties, which the Offset Defense 100 Nev. 703, 708-9, 6 erred in res. Warmbrodt v. Blanchard, ct court of

P.2d 1282 (Nev. 1984) (dist

tructing jury to consider and apportion neg I
§

non-parties); see also Nev. Rev. Stat.

41.141.

Finally,

plaintiff argues that allowing the offset would produce an rmiss recovery. Defendants contend that the Offset Defense is necessary to the inequity that would occur if defendants were held responsible for all of pIa co-driver and employer make three arguments iff's i r the uries even if plaintiff's Defendants e double reduction of plaintiff's third-party

ority of fault.

support of their contention.

First, defendants assert that the Offset Defense is not abrogated by statute, since the 1977 legislative history never mentions Santisteven. Defendants are correct that Santisteven is is mentioned by name.
I

not expressly referenced; however, find the offset s

s in Santisteven and Witt are

indistingui

e, and accordi is not

y the failure to mention Compare

spositive of this issue.

362 F.Supp. at 651,

366 P.2d at 649-50.

Second, defendants contend that the NllA's exclusive provision does not apply to offset in Santisteven.

Defendants assert that the exclusive remedy provision and the Offset Defense are functionally consistent. stinct, and as such, are

Namely, the NllA was meant to preclude claims employer, while the Offset Defense was

directly against

intended to provide relief to a third party who otherwise would be unfairly burdened with the full financial responsibility of an accident that was caused by the employer. Third, defendants argue that the 1977 amendments adopted pursuant to Senate Bill 12 had a dif alleges. purpose than plaintiff

Defendants assert that the amendments prevent double

recovery by an injured worker, but say nothing about denying a third-party right an offset. As such, defendants argue

that the amendments in question have no relevance to this case. I find that the language added during the 1977 amendment is not decisive on the issue of offset for an employer's contributing negl evidence that While the slative story provides

purpose of the amendment was to abrogate the

Offset Defense, I agree with defendants that the language that was ult ely added is not a clear abrogation of Santisteven.

The amendments in question could reasonably be interpreted as stating that an injured employee is not entitled to double recovery "notwithstanding any act or omission of the employer or

a person in

same employ."

Regardless, I find that the Offset Defense is not vi under current Nevada law. Plaintiff's inte ion of the 1977

amendment is consistent with the purpose of the NIIA, which is to encourage employer compliance with wor by providing immunity from De
s' compensation statutes

e defendants' assertions cts s

to the contrary, I find that the proposed offset cont exclusive immunity granted to the employer that compensation coverage in compliance with Nevada law. the Offset Defense, which punishes

des workers' Further,

employer for concurrent for contribution and

negligence, is similar to defendants' cIa indemnity that this Court has already Moreover, as noted

, Santisteven has never

followed by any Nevada court after the 1977 amendment. Despite defendants state of ed contention that Santi steven is the current law because it s never ery directly overruled,

the fact that it has not been followed in over thirty years is strong evidence that Nevada does not recognize the Offset Defense. Further, was mere a rul by the

District Court of Nevada attempting to predict what the Nevada Supreme Court would do with the issue of apportionment for oyer ne igence. At least one recent Nevada Supreme Court is not determinative on the ligence. See Am. Home

decision concluded that issue of offset r an employer's

Assurance v. Eigth Judicial Dist. Court, 122 Nev. 1229, 1243 n.47, 147 P.3d 1120 (2006) ("this court has never determined

whether, in Nevada, an insurer's reimbursement from third-party

proceeds may be negligence") . Finally, contributory negl behalf of the t r the

cted by the emp

r's concurrent

was state.

ided when Nevada was a There , any igence on to

oyer, even if it was nominal, was fset De e. state.

Nevada has subsequently become a See Nev. Rev. Stat.
§

comparat

negl

41.141.

As

such, there currently exists no procedure by which a jury could ide the procedure would of the employer. re a j Regardless,any conceivable

to allocate fault between Nevada, igence between non120 Nev. 822, (cit Warmbrodt) . This Court

defendants and non-parties STI and Rodney however, does not allow apportionment of parties. 844-5 n.61, 102 P.3d 52 (2004)

ously declined to add plaintiff's employer and co-employee as third-party defendants, be cons as such, their negligence cannot

red, rendering defendant's Offset Defense futile. iff's motion for rtial summary judgment

Accordingly, pIa is granted with re defense.

to defendants' second affirmative

CONCLUSION

Plaintiff's motion for is GRANTED. The

ial summary judgment (doc. 166)

Defendants' motion to strike (doc. 270) is DENIED.

rties' requests for oral argument are DENIED as

unnecessary.

IT IS SO ORDERED. Dated this

/~

March 2011.

Ann Aiken United States District Judge