News

 Damages on account of personal injury are not “income” for income tax purposes under Internal Revenue Code § 104, even if part of the award is for lost wages. It has long been assumed, though without express statutory authority, that such damage awards were also not “wages” or “compensation” for purposes of employment taxes, including FICA, Medicare, and Railroad Retirement taxes. Recently, however, BNSF Railway has withheld Railroad Retirement taxes from payments to injured workers in satisfaction of FELA judgments. BNSF argued, with support from the United States as amicus curiae, that such payments are “compensation” under the Railroad Retirement Tax Act. The supreme courts of Nebraska and Iowa have agreed.

A federal district court recently held that FELA damages on account of personal injury are not subject to RRTA withholding. Cowden v. BNSF Ry. Co., 4:08CV01534 ERW (E.D. Mo. July 7, 2014). The court took note of a recent article by CCL Senior Counsel Jeffrey R. White, The Taxman Cometh . . . To Your FELA Judgment, TRIAL, Apr. 2014, at 16, analyzing this issue. The court determined that FELA damages for lost income could be “compensation.” However, as detailed in the Trial article, “income” is broader than “compensation” and plaintiff’s entire award is excluded from income by section 104. The district court concluded that BNSF improperly withheld Railroad Retirement taxes from its payment in satisfaction of plaintiff’s FELA judgment.

CCL President Robert S. Peck participated as an observer in deliberations of a new task force appointed by the Conference of Chief Justices to examine issues with rules governing civil cases in state courts, when the task force met for the first time May 11-13 in Arlington, VA.

The task force began an 18-month effort to look at issues of cost and delay in the system, as well as bet practices and rules proposals that will as drew these problems. Subcommittees of the task force will continue meeting by phone until another session planned for Washington, DC in November.

CCL President Robert S. Peck presided at a March 20-21 meeting of the Board of Overseers of the RAND Institute for Civil Justice, where studies were discussed involving such diverse civil justice issues as judicial recusals involving stock ownership, asbestos litigation, victim compensation funds, insurance requirements for autonomous vehicles, and workers compensation. The Santa Monica, California meeting marked the beginning of Peck’s two-year term as chair of the Board.  The Institute for Civil Justice, established in 1979, analyzes trends and outcomes, as well as identifies and evaluates policy options, with an eye to making the civil justice system more efficient and more equitable through objective, empirically based research. 

Representing the American Association for Justice, CCL’s Andre M. Mura filed an amicus curiae brief in the Florida Supreme Court, urging the Court to find that an injured worker who is totally disabled and unable to work but still improving medically is entitled to permanent total disability benefits at the expiration of temporary total disability.

In this case, Westphal v. City of St. Petersburg, No. SC13-1930, a firefighter suffered serious injuries in the course of employment. After receiving 104-weeks of temporary total disability benefits, which is the statutory maximum, Westphal applied for permanent total disability but was rejected because, despite still being totally disabled and unable to work, a medical expert opined that his medical condition might improve. Westphal was thus denied any benefits despite his injury and inability to work until he could show that he had reached maximum medical improvement. A three-judge panel of the First DCA ruled that the Workers’ Compensation Law violated the Florida Constitution’s right of access to courts, because the remedies available today were inadequate when compared with common law and statutory remedies available when the constitutional right was adopted. The First DCA then granted en banc review. After withdrawing the panel decision, the en banc court held that the Workers’ Compensation Law was properly understood to allow injured workers who remain totally disabled to apply for permanent total disability benefits at the expiration of temporary total disability benefits.

The Florida Supreme Court has agreed to review this decision. The AAJ amicus brief filed by CCL supports the ruling of the en banc First DCA. “Rather than denying injured workers any disability benefits for an indefinite period despite their being totally disabled and unable to work, and denying them any retroactive benefits if it is later evident that they had been already made a full medical recovery,” the brief argued, “the en banc First DCA’s interpretation of section 440.15(3)(d) will permit injured workers who are totally disabled and unable to work, but still possibly improving medically, to be deemed at maximum medical improvement by operation of law, and thus be eligible for permanent total disability benefits.  Put simply, totally disabled injured workers, who are required by law to give up their common law right to sue for full compensation in return for a prompt assurance of benefits, will in fact be assured benefits promptly.” Alternatively, the brief argued that, if the statute must be read to deny such benefits to injured workers, then the Workers’ Compensation Law violates the Florida constitutional right of access to courts. 

CCL welcomes Kathryn S. Minton as the firm’s new associate litigation counsel.  At CCL, Minton will represent plaintiffs in litigating a broad array of state and federal matters at both the trial and appellate level. 

Prior to joining CCL, Minton clerked for Supreme Court of Missouri Judge Paul C. Wilson.  Previously, Minton clerked for Court of Appeals for the Eastern District of Missouri Judge Kenneth M. Romines and worked as a solo practitioner for plaintiffs recovering breach of employer contract damages. 

Minton earned her Juris Doctor from Washington University School of Law, where she was a member of the National ABA Moot Court Team and a Cash Nickerson Fellow, and her Bachelor of Arts in German, with distinction, from the University of Virginia. 

During law school, Minton spent a summer clerking for United States Court of Appeals for the Eighth Circuit Judge Raymond W. Gruender and was a summer associate at the Legal Aid Board in Durban, South Africa.

CCL President Robert S. Peck became chair of the Board of Overseers of the RAND Institute for Civil Justice (ICJ) Oct 26, 2013.  The Santa Monica, CA-based ICJ conducts objective, empirically based, analytic research on issues arising in the civil justice system.  Its frequently cited research analyzes trends and outcomes, identifies and evaluates policy options, and brings together representatives of different interests to debate alternative solutions to policy problems. Its Board of Overseers includes prominent judges, general counsel of large corporations and insurance companies, academics, and members of the bar. The ICJ is a division of the RAND Corporation, a well-known nonprofit institution that helps improve policy and decisionmaking through research and analysis.  Peck will serve two years as chair of the ICJ Board.

The U.S. Chamber of Commerce has listed CCL President Robert S. Peck among the nation’s leading plaintiff’s lawyers in a new 158-page report, published by the Chamber’s Institute for Legal Reform.  Entitled “The New Lawsuit Ecosystem: Trends, Targets and Players,” the report purports to identify key lawyers and litigation trends in the civil justice system, as well as how litigation influences public policy. While the Chamber remains an opponent of the litigation trends it identifies in the report, it nonetheless acknowledges Peck as one of the “highly respected plaintiffs’ lawyers” who does not “neatly fit in any of the areas discussed” in the report.  Peck’s work challenging the constitutionality of laws restricting compensation for injuries is specifically acknowledged as the basis for his listing.

 CCL President Robert S. Peck participated in two ABA meetings in Chicago, September 26-27.  He chaired a meeting set up by ABA President James Silkenat to find common ground between competing proposals to address judicial disqualification in light of the U.S. Supreme Court decision in Caperton v. A. T. Massey Coal Co., 556 U.S. 868 (2009).  Representatives of the ABA Judicial Division, the ABA ethics committee, and the Conference of Chief Justices discussed concerns about different approaches to addressing when disproportionate monetary contributions create an appearance of bias in elected judges.  Discussions will be ongoing.

In addition, Peck attended the annual ABA Section Officers Conference, where he represented the Tort, Trial and Insurance Practice Section (TIPS).  Peck serves as the senior ABA House of Delegates member from TIPS.

Standing in the party’s shoes when considering a motion to recuse is one of the key pieces of advice CCL President Robert S. Peck gives judges in an article entitled, “A Jurist and a Lawyer Consider Judicial Recusal after Caperton,” published in the new issue of Judge’s Journal, a publication of the ABA’s Judicial Division. Coauthored with Judge N. Randy Smith of the U.S. Court of Appeals for the Ninth Circuit, Peck reviews the decision in Caperton v. A.T. Massey Coal Co. (2009), and discusses its implications.

Stating that there is enough experience since the 2009 decision “to know that Caperton-like disqualification motions will not become de rigueur,” Peck indicates that states revising their rules to heed the Supreme Court’s call for objective standards need not adopt “bright-line rules,” but instead reflect state-specific values, mindful of the need to assure a fair hearing.

TRIAL magazine has published an article by CCL President Robert S. Peck, offering strategies that trial lawyers should employ to preserve their victories on appeal or overturn an adverse result, in its July 2013 issue.  In Looking Down the Appellate Road,* Peck discusses the importance of such crucial questions as contemporaneous objections, record preservation, proffering excluded evidence and conforming to procedural complexities, along with a handy list of practical considerations.  Trial counsel will always be concerned with staying on the good side of the trial judge by not being too aggressive in objecting to rulings, Peck writes, but the failure to preserve the issue for appeal requires an objection on the record. “The seeds of success on appeal,” Peck states, “often grow from those planted before trial.” He advises that in cases involving high stakes or complicated trial procedure lawyers are well-advised to plan for trial, but anticipate an appeal, where the ultimate determination of the case’s success or failure is likely to be made. 

*Login required.