Bloom v. Slash, Inc.

JULIE BLOOM, Employee/Appellant, v. SLASH, INC., f/k/a GT INTERACTIVE SOFTWARE and MICHIGAN PHYSICIANS MUT. LIAB. CO., Employer-Insurer, and WIZARD WORKS and LUMBERMENS/KEMPER, Employer-Insurer, and TIMELY TEMPORARIES and MINNESOTA ARP/BERKLEY RISK ADM=RS CO., Employer-Insurer, and MINNESOTA DEP=T OF HUMAN SERVS. and MEDICA/HRI, Intervenors.

PRACTICE & PROCEDURE - DISMISSAL. Vacation of the compensation judge=s order for dismissal was appropriate where the judge made no findings on factual issues and there was no record of the proceedings leading to the dismissal.

Attorneys: David W. Blaeser, Attornye at Law, Woodbury, MN, for Appellant. Mark A. Fonken, Jardine, Logan & O=Brien, Lake Elmo, MN, for Respondents Slash, Inc. and Mich. Physicians Mut. Liab. Co. Kathy A. Endres and Susan M. Stepaniak, Aafedt, Forde, Gray & Monson, Minneapolis, MN, for Respondents Wizard Works and Lumbermens/Kemper. Patrick E. Mahoney, Mahoney, Dougherty & Mahoney, Minneapolis, MN, for Respondents.

The employee appeals from the compensation judge=s order dismissing the employee=s claim petition.^[1] We vacate the order of dismissal and remand the case to the Office of Administrative Hearings for further proceedings consistent with this decision.

Litigation in this matter began on March 13, 2000, with the filing of a claim petition in which the employee claimed entitlement to permanent total disability benefits commencing May 6, 1998. The employee, Julie Bloom, alleged that she had contracted hepatitis C and developed a chronic pain syndrome, a generalized anxiety disorder, and depression, all consequent to cutting her finger while working for GT Interactive Software on July 2, 1997.^[3]

The employee subsequently amended her claim petition on February 21, 2001,^[4] to join Timely Temporaries as an additional employer, and she again amended her petition on July 31, 2001, to allege that her injury had occurred on or about January 1, 1996, rather than July 2, 1997.^[5] Timely Temporaries denied that the employee had been in their employ at the time of the alleged injury in January 1996 and later alleged that the employee first began working for Timely Temporaries on June 26, 1996.

On January 14, 2002, Timely Temporaries and its insurer, Minnesota Workers= Compensation Assigned Risk Plan/Berkley Risk Administrators filed a motion for joinder of Slash, Inc. (Infogrames, Inc.) f/k/a GT Interactive Software, insured by Kemper, and Wizard Works, insured by Michigan Physicians Mutual Liability Company,^[6] as parties to this case, on grounds that the employee may have worked for these two employers on or about January 1, 1996. An Order for Joinder of Slash, Inc., and Wizard Works was issued on February 25, 2002. The employers and their insurers have all denied liability for the employee=s alleged injury, and all assert that no employment relationship existed with the employee prior to the employee=s contraction of the hepatitis C virus.^[7]

On November 8, 2002, Slash filed a motion for dismissal, together with affidavits and supporting documentation, contending that the employee did not commence employment with Slash until January 20, 1997, after the employee had already been diagnosed with hepatitis C. On December 2, 2002, Wizard Works filed a motion to dismiss on similar grounds. Shortly thereafter, on December 11, 2002, a compensation judge denied Slash=s motion on grounds that the employee had produced a check stub from GT Interactive Software dated January 1996, creating Aenough of a factual issue to require a hearing to determine actual dates of employment.@ Also by that date, a hearing on the employee=s claim had been was scheduled for March 5, 2003.

In February 2003, all three employers and their insurers filed motions for reconsideration of previous motions for dismissal. The day before the scheduled March 5, 2003, hearing, the third attorney to represent the employee withdrew from the case. At that point, the court issued an order striking the matter from the active calendar.

The employee evidently retained a new attorney to represent her in March 2004, and the employee=s claims and various motions for dismissal and motions for reconsideration were scheduled for a pretrial conference on May 3, 2004. At the conference, Compensation Judge Rolf G. Hagen heard oral arguments from all parties for and against dismissal of the employee=s claim petition. At the conference, the employee apparently alleged that she had worked for Timely Temporaries prior to June 26, 1996, and within a period of time just prior to testing positive for hepatitis C. At the conclusion of the conference, the judge allowed the employee an additional two days to submit evidence supportive of her claims. On May 11, 2004, Judge Hagen issued an order dismissing the employee=s claim petition, as amended. In a memorandum accompanying his order, Judge Hagen stated that the employee=s claim petition was dismissed Aby reason of employee=s failure to prosecute her claims and further by reason of employee=s failure to provide evidence in support of her employment relationship (with any/all of the above-named employers) or medical causation.@ The employee appeals.

The employee argues on appeal that the compensation judge erred in dismissing her claim petition without benefit of a hearing on the record, contending that there are disputed issues of fact that require a formal hearing before a compensation judge. The employers and insurers argue that the employee has had four years from the filing of her claim petition, and more than two years since all parties were joined, to present evidence of an employment relationship with any of the named employers at the time of her injury. Nor has she submitted, they contend, medical evidence establishing a causal relationship between her alleged disability and her employment. Accordingly, they argue, the judge properly dismissed the claim petition on grounds that the employee had failed to prosecute her claims or provide evidence of her employment relationship or medical causation. We conclude that further proceedings are required.

As previously noted, the compensation judge gave several reasons for his dismissal of the employee=s claim petition. The judge, however, made no findings on what are clearly factual issues; i.e., the existence of an employment relationship on the alleged date of injury and medical causation for the employee=s condition. Rather, in his memorandum, the judge simply indicated that the employee failed to produce Aevidence@ on these issues. At the same time, however, no record was made of the proceedings leading to the order for dismissal. There being no Aevidence@ or record for review, we are simply unable to perform our appellate review function - to determine whether the judge=s decision is clearly erroneous or unsupported by substantial evidence in the record as a whole. See Minn. Stat. ' 176.421, subd. 6; Zuehlke v. Penrose Oil Co., slip op. (W.C.C.A. Jan. 24, 2001). There is, in fact, no way for us to determine exactly what the judge considered in arriving at his decision. We would also note, with regard to the judge=s reference to the employee=s alleged failure to prosecute her claim, that there is no allegation that the employee failed to comply with relevant rules or any order of the court.

[a]n order of dismissal on procedural grounds runs counter to the primary objective of the law to dispose of cases on their merits. Since a dismissal with prejudice operates as an adjudication on the merits, it is the most punitive sanction which can be imposed for non-compliance with the rules or order of the court, or for failure to prosecute. It should therefore be granted only under exceptional circumstances. The primary factor to be considered in determining whether to grant a dismissal with or without prejudice is a prejudicial effect of the order upon the parties to the action. . . .

277 Minn. 278, 283, 151 N.W.2d 364, 368 (1967). It may well be that the judge in the present case had good reason to dismiss the employee=s claim petition. However, no meaningful review of the judge=s decision may be accomplished until a record is created and factual findings are made. Therefore, under the circumstances presented here, we vacate the compensation judge=s May 11, 2004, dismissal order and remand the case to the Office of Administrative Hearings for further proceedings on the employers= and insurers= motions.

^[1] A party may appeal to the Workers= Compensation Court of Appeals from Aan award or disallowance of compensation, or other order affecting the merits of the case.@ Minn. Stat. ' 176.421, subd. 1. Here, because the statute of limitations would bar the refiling of the employee=s claim petition, the judge=s order is in effect a final determination on the merits of the case and, therefore, an appealable order. See Minn. Stat. ' 176.151; DeMars v. Robinson King Floors, Inc., 256 N.W.2d 501, 30 W.C.D. 109 (Minn. 1977).

^[2] The background facts in this case have been gleaned from documents in the imaged file, and, in some instances, from the briefs. There is no official record of the proceedings.

^[3] MEDICA CHOICE and the Minnesota Department of Human Services subsequently intervened in this matter. According to the imaged file, MEDICA=s intervention interest is $1,261.33, and as of January 2003, the Department of Human Services had paid $35,103.36 under its Medical Assistance program and $5,011.90 under its General Assistance program.

^[4] Attached to the employee=s amended claim petition was a handwritten report from Dr. Gregory Plotnikoff dated January 11, 2000, in which Dr. Plotnikoff stated that the employee=s history Ais most compatible with scientific understandings of the [hepatitis C] virus transmission.@

^[5] On December 28, 2001, the insurer for GT Interactive Software, Chubb Insurance, was dismissed from this case because Chubb did not insure this employer on January 1, 1996.

^[6] The file here is not entirely clear, but it appears that Slash, Inc., and Wizard Works may be successor companies to the originally named employer, GT Interactive Software.

^[7] According to documentation submitted with several motions to dismiss the employee=s claim petition, it is alleged by the employers and insurers, and apparently conceded by the employee, that the employee first tested positive for hepatitis C on June 21, 1996.