This opinion will be unpublished and

may not be cited except as provided by

Minn. Stat. ' 480A.08, subd. 3 (1994).




Denise L. Schmidt,






GAB Business Services, Inc.,


Filed June 11, 1996


Lansing, Judge

Dakota County District Court

File No. C0956720

Daniel E. Warner, Warner Law Office, P.A., Suite 204, 3445 Washington Drive, Eagan, MN 55122-1340 (for Appellant).

Penelope J. Phillips, Felhaber, Larson, Fenlon & Vogt, P.A., 4200 First Bank Place, 601 Second Avenue South, Minneapolis, MN 55402 (for Respondent HealthEast).

Carol A. Kubic, Pustorino, Pederson, Tilton & Parrington, P.A., Suite 200, 4005 West 65th Street, Edina, MN 55435 (for Respondent GAB Business Services, Inc.).

Considered and decided by Lansing, Presiding Judge, Short, Judge, and Stone, Judge.*

U N P U B L I S H E D   O P I N I O N


Denise Schmidt sued her employer, HealthEast, and its insurance claims adjuster, GAB Business Services, Inc., for damages related to their handling of her workers' compensation claims following a work-related injury. Schmidt appeals the district court's summary judgment against her claims for (I) intentional obstruction of workers' compensation benefits, (II) intentional infliction of emotional distress, (III) negligent infliction of emotional distress, and (IV) tortious interference with contract. The facts advanced to support these causes of action are insufficient to create a triable issue, and we affirm.


To defeat summary judgment, the nonmoving party must produce specific facts demonstrating a genuine issue of material fact. Patton v. Newmar Corp., 538 N.W.2d 116, 119 (Minn. 1995). A defendant is entitled to summary judgment as a matter of law if the record reflects a lack of proof on an essential element of the plaintiff's claim. Nicollet Restoration, Inc. v. City of St. Paul, 533 N.W.2d 845, 847-48 (Minn. 1995) (citing Celotex Corp. v. Catrett, 477 U.S. 317, 322, 106 S. Ct. 2548, 2552 (1986)).


Minnesota law allows a civil action against anyone "intentionally obstructing an employee seeking workers' compensation benefits." Minn. Stat. ' 176.82, subd. 1 (1994 & 1995 Supp.). This civil action is separate and independent from any penalties provided under the Workers' Compensation Act for unreasonably or vexatiously denying or delaying benefits and is available only in "those situations where the insurer's delay or denial of benefits goes beyond unreasonableness, neglect, or obstinance." Bergeson v. United States Fidelity & Guar., 414 N.W.2d 724, 727 (Minn. 1987). To maintain a civil action, the employee must establish by clear and convincing evidence deliberate, outrageous, and extreme conduct that obstructs or hinders the receipt of benefits due the injured worker. Id. The conduct must rise to a level that is cruel or venal. Id.

Schmidt's civil action alleges three wrongful discontinuances of her benefits. The first followed a disagreement over the choice of a rehabilitation program. See Minn. Stat. ' 176.135, subd. 1 (1994 & 1995 Supp.) (requiring employers to provide reasonable physical therapy for injured workers). An employer may discontinue benefits if an employee refuses reasonable medical treatment. Dotolo v. FMC Corp., 375 N.W.2d 25, 28 (Minn. 1985). Schmidt acknowledges that her disagreement with HealthEast and GAB over which facility would offer the best services at the lowest price was a legitimate dispute. Even if the employer had been unreasonable, such conduct is a basis for a claim within the workers' compensation system but is not the extreme, outrageous, or venal conduct that would support a separate civil action.

The claim also falls short of the statute's requirement that benefits must actually be denied or disrupted. Flaherty v. Lindsay, 467 N.W.2d 30, 32 (Minn. 1991). GAB terminated Schmidt's benefits but reinstated them before the next benefit payment period ended. GAB's action shifted some of Schmidt's benefits into the next pay period, resulting in a delay but not a disruption or denial.

The second claim involved a termination of benefits when Schmidt failed to respond to an offer of a light-duty job that accommodated her physician-imposed physical limitations. A third claim arose when Schmidt failed to respond to a subsequent light-duty job offer. It is undisputed that Schmidt's severe depression prevented her from accepting the job offers. But an employer's offering a job that physically accommodates the work injury does not constitute the extreme or outrageous obstruction of benefits that section 176.82 covers. See Minn. Stat. ' 176.101, subd. 3e(b), 3f (1994 & 1995 Supp.) (allowing employer to terminate benefits when employee refuses job accommodating employee's physical restrictions). Whether the ensuing termination was proper may well be subject to dispute in the administrative proceedings within the workers' compensation system, but unreasonable or offensive behavior does not equate to outrageous, venal, or cruel conduct. See Flaherty, 467 N.W.2d at 32 (characterizing bad faith offer of unsuitable employment as offensive).


To support a claim for intentional infliction of emotional distress, a defendant must "intend to cause severe emotional distress or proceed with the knowledge that it is substantially certain, or at least highly probable, that severe emotional distress will occur." K.A.C. v. Benson, 527 N.W.2d 553, 560 (Minn. 1995); see also Hubbard v. United Press Int'l, 330 N.W.2d 428, 438-39 (Minn. 1983) (listing elements of intentional infliction of emotional distress).

Schmidt asserts that intent is a fact issue but points to no direct or circumstantial evidence that shows GAB or HealthEast's intent to cause severe emotional distress. With one exception all the allegedly outrageous conduct occurred before GAB and HealthEast knew that Schmidt was particularly susceptible to stress. The evidence demonstrates that GAB and HealthEast were trying to aggressively administer the insurance policy as they interpreted it, but there is no evidence of an intent to cause Schmidt severe emotional distress.


Negligent infliction of emotional distress requires that the plaintiff was within a zone of danger of physical impact, reasonably feared for her own safety, and suffered severe emotional distress. K.A.C., 527 N.W.2d at 557. Schmidt concedes that she was not within a zone of danger and consequently cannot satisfy that element.

Schmidt argues that her injuries come within an exception that allows damages for mental distress for direct and intentional invasion of rights. See State Farm Mut. Auto. Ins. Co. v. Village of Isle, 265 Minn. 360, 367-68, 122 N.W.2d 36, 41 (1963); Bohdan v. Alltool Mfg., 411 N.W.2d 902, 907 (Minn. App. 1987), review denied (Minn. Nov. 13, 1987). We reject this argument because, first, Schmidt has not produced evidence of intentional violation of her rights and, second, the purported exception applies only to define when emotional distress damages are recoverable and does not change the elements of an action for negligent infliction of emotional distress. See Langeland v. Farmers State Bank of Trimont, 319 N.W.2d 26, 31 (Minn. 1982).


Schmidt's final claim is against GAB individually for tortious interference with her employment contract with HealthEast. This claim is without merit because Schmidt produced no evidence that GAB intentionally engineered a breach of her employment contract with HealthEast. See Furlev Sales & Assocs. v. North Am. Auto. Warehouse, 325 N.W.2d 20, 25 (Minn. 1982) (listing intentional and unjustifiable procurement of breach as a necessary element). Moreover, GAB had a contractual responsibility to monitor Schmidt's claims and benefits under the Workers' Compensation Act. See Nordling v. Northern States Power, 478 N.W.2d 498, 506 (Minn. 1991) (agent acting pursuant to duties has a privilege to interfere with an employment contract). The district court did not err by granting GAB summary judgment on this claim.

We conclude that the facts fail to meet the necessary evidentiary threshold on essential elements of Schmidt's claims, and we affirm. Because the claims do not survive summary judgment, there is no reviewable issue on punitive damages.



* Retired judge of the district court, serving as judge of the Minnesota Court of Appeals by appointment pursuant to Minn. Const. art. VI, ' 10.