John H. Geaney – July 12, 2012

The Judge of Compensation and Appellate Division found that the employee was entitled to no benefits based on his violation of the New Jersey Fraud Act

In Johnnie Jackson v. Township of Montclair, A-2212-11T2 (App. Div. July 5, 2012), the claimant injured his knee while moving large boxes of books at the Montclair Public Library on August 4, 2008.  He immediately stopped working and went to Mountainside Hospital where a brace was put on the right knee.  He was seen by a number of physicians thereafter.  An MRI of the right knee done on August 28, 2008 showed a tear of the posterior horn of the medial meniscus.  Petitioner underwent arthroscopic surgery on September 18, 2008 to repair the meniscal tear.

When the claimant saw Dr. Hatfield shortly after his accident, there was no indication whether he had any prior knee injuries.  When he saw Dr. Mendes, the doctor wrote that he “denied any history of knee injuries or pain in the past.”  When he saw Dr. Colizza, the doctor noted that he “denied any problems with respect to his right knee prior to his work injury.”

Contrary to his assertions to these doctors, the claimant had been involved in an automobile accident on April 13, 2007 and treated with a surgeon, Dr. Vizzone, who ordered an MRI and diagnosed a “tear of the posterior horn of the medial meniscus” and “a partial tear of the anterior cruciate ligament.”  Petitioner was told he would need knee surgery but he did not undergo the surgery.  He did, however, bring a law suit, and he signed answers to interrogatories on December 15, 2008 stating that the injuries he suffered in the car accident “are considered to be permanent” and “continue to limit his activities” and “cause great pain on a daily basis.”  He said in these answers that he suffered pain and discomfort while working, bending, lifting, sitting, and sleeping.

The Township of Montclair referred petitioner to Dr. Carl Mercurio for an IME.  Dr. Mercurio stated that petitioner’s knee problem was causally related to the work injury in August 2008 but that he was aware of a prior car accident and would like to see those records. After he received the records of the car accident, Dr. Mercurio concluded that the work injury only caused a sprain and strain and that the tear of the medial meniscus had already been there before the work injury.  He amended his initial report and opined that petitioner’s 7.5% disability of the leg was all due to the car accident, not the work injury.

Trial ensued in this case.  When the claimant testified he said that prior to the work injury in 2008 his knee had been “feeling great.”  He was confronted with answers to interrogatories in the civil law suit and said that some of his answers had been wrong and he signed them without knowing what they were. He also said he did not recall being told that he had a tear in his knee after the car accident.  He later admitted that Dr. Vizzone had in fact told him he needed surgery for his knee from the car accident. He said he had no idea why Dr. Hatfield, Dr. Mendes and Dr. Colizza had no knowledge of the prior car accident and knee injury.

The petitioner’s expert, Dr. Tiger, was also shown the prior car accident records and admitted that Dr. Colizza had not been given an accurate history of petitioner’s prior knee injury.  He said that without an accurate history, the treating doctors would have been confused on causation.

The Township filed a motion to dismiss the petitioner’s claim for violating N.J.S.A. 34:15-57.4, the New Jersey Fraud Act.  The Honorable Nilda Hernandez, Judge of Compensation, dismissed the case, finding that petitioner made material omissions which constituted “fraudulent conduct.”  She also ordered that petitioner repay temporary disability benefits in the amount of $17,497.71 as well as costs of surgery in the amount of $892.33.  He was permitted to keep $3,262.86 for temporary disability compensation for a sprain of the knee.

Petitioner appealed and argued that the Judge of Compensation erred in not finding that petitioner sustained a permanent injury at work.  He also argued that the Judge relied on impermissible hearsay evidence.  The Appellate Division rejected all these arguments and affirmed the dismissal of the case.  The Court noted that there was ample evidence to support the Judge of Compensation’s finding that petitioner was not trustworthy.  In particular, the Appellate Division noted that petitioner explicitly denied suffering any knee injury prior to the work accident.

The case is an important reminder that the New Jersey Fraud Act can be invoked when a claimant is not forthcoming about prior relevant medical history.  Material omissions or misstatements by either party in a workers’ compensation proceeding may be actionable under the Fraud Act.

This is a big win for employers in New Jersey. It goes back to the same basic principal: employers who stay on top of their workers compensation claims will ultimately keep their workers compensation costs down. So make sure that all information is investigated when an employee gets injured. It's your job as the employer to be on top of things. Don't leave it up to the insurance companies or anyone else. Take a proactive approach. Those that do will see workers compensation premium reductions and if you want to recover workers compensation overcharges, we can help you with our workers compensation recovery program.