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Ohio Supreme Court Holds Third Parties Jointly and Severally Liable as to Subrogation Interest on Post Settlement Workers’ Compensation Benefits

WORKERS

CASE ALERT:

The Ohio Supreme Court has issued a decision underscoring the reach of the state’s workers’ compensation automatic subrogation statute.

In Bureau of Workers Compensation v. Verlinger (Slip Opinion No. 2018-Ohio-1481), Ohio’s high court reversed the lower courts, holding that both a claimant and settling third parties are jointly and severally liable for the subrogation lien, including as yet unpaid and future benefit payments. Third parties would include the tortfeasor, its insurance carrier, and the claimant’s underinsured motorist insurer.

In Verlinger, the statutory subrogee (the Bureau) filed suit asserting its subrogation interest naming as defendants the claimant, her insurer and the insurer of the driver alleged to have caused the accident.

The factual setting was interesting given that at the time of the third-party settlements there were no workers’ compensation benefits paid. In fact, the claimant had previously been denied workers’ compensation benefits for failing to demonstrate that the motorcycle crash injury occurred within the course and scope of the driver’s employment. The denial was subsequently reversed on administrative appeal and the claimant was deemed eligible for benefits.

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