VALERIE WINSTEAD, Employee, v. MARTIN LUTHER MANOR/FAIRVIEW HEALTH SVCS., SELF-INSURED, Employer/Respondent, and PAR, INC., Appellant.

PAR appeals from a compensation judge’s determination that it was not an intervenor and thus was entitled to neither payment for rehabilitation services provided nor to a Parker-Lindberg^[1] hearing.

On January 25, 2017, the employee, Valerie Winstead, suffered an alleged work-related injury while working for the self-insured employer, which denied primary liability.

On March 10, 2017, the employee, represented by attorney Michael Schultz, served and filed a claim petition seeking various benefits including “vocational services.” The claim petition identified a “rehabilitation expert reserved” as a witness. Two medical providers were notified of their right to intervene, however, because the employee did not yet have a Qualified Rehabilitation Consultant (QRC) and had not received any vocational services, no intervention notice was given to any vocational services provider.

On the same day, March 10, 2017, the employee’s attorney served and filed a rehabilitation request seeking to have PAR provide vocational rehabilitation services, and a copy was mailed to PAR.

The employer filed a rehabilitation response on March 21, 2017, asserting that because primary liability had been denied, the employee should seek rehabilitation services from the Vocational Rehabilitation Unit (VRU) of the Department of Labor and Industry (DLI). This rehabilitation response was served on the employee and her attorney, and was mailed to PAR. The employer’s attorney also sent a letter to PAR, copied to Mr. Schultz, reiterating the employer’s position that because there was a denial of primary liability, vocational services should be provided by VRU rather than PAR. The letter went on to advise PAR that the employer would deny liability and payment for any services PAR provided.

On the following day, March 22, 2017, a QRC at PAR performed a vocational rehabilitation consultation. On April 4, 2017, the QRC filed a rehabilitation consultation report which stated, among other things, that the employee was not precluded from engaging in her usual and customary occupation and that she could reasonably be expected to return to suitable gainful employment with the employer. The QRC nevertheless found the employee qualified to receive rehabilitation services.

After receiving the rehabilitation consultation report, the employer filed a rehabilitation request, served on the employee and her attorney, and mailed to PAR, asking that rehabilitation services provided by PAR be terminated because the employer had denied primary liability, and because the employee was not a qualified employee for the purpose of receiving rehabilitation services. The record contains no response to this rehabilitation request from the employee or PAR. On April 18, 2017, a compensation judge consolidated the employee’s claim petition and the employer’s rehabilitation request.

PAR continued to provide various rehabilitation services. On June 16, 2017, PAR, acting pro se, filed a rehabilitation request at DLI, seeking payment for outstanding invoices for rehabilitation services totaling $1,567.76. Counsel for both the employee and the employer were served with this rehabilitation request.

In response to the employer’s attorney’s March 21, 2017, letter, PAR sent a letter on July 18, 2017, stating, “[T]he present WCCA law specifically allows rehabilitation providers to work on denied claims, as long as there is an understanding that the rehabilitation provider is taking the risk of non-payment.” In this letter, PAR also asked to be included in any settlement discussions. The next day, on July 19, 2017, the employer’s attorney sent a notice letter for potential intervenors to PAR, which included a copy of the claim petition and information on how to file a motion to intervene in the case.

On July 21, 2017, DLI notified PAR that it did not have jurisdiction over PAR’s rehabilitation request in light of the employer’s primary denial of liability. DLI’s letter stated, in part, that   “[n]o further action will be taken regarding the Rehabilitation Request that you filed on 6/19/17.” It advised PAR to “contact the employee to determine whether a claim petition has or will be filed or whether there is a matter pending in which you can intervene.”

PAR did not file a motion to intervene, despite the July 19, 2017, intervention notice letter from the employer’s attorney, and the July 21, 2017, letter from DLI.

The employee, through her attorney, entered into settlement negotiations with the employer. Also included in these negotiations were various medical providers which had intervened. PAR had not intervened, was not included in settlement discussions, and no settlement offer was extended to PAR.

According to PAR’s records, the employee’s attorney notified PAR on September 5, 2017, that a settlement had been reached between the employee and the employer. On September 7, 2017, PAR prepared a rehabilitation plan closure report.

On September 21, 2017, more than 60 days from the date of service of the intervention notice to PAR, the employee and her attorney, Mr. Schultz, signed a Stipulation for Settlement. The stipulation stated, among other things, that the attorney for the employer had provided proper intervention notice to PAR, that PAR had failed to intervene, and “that [both] the employee and the employer have been prejudiced by the failure of [PAR] to intervene in a timely fashion.” The stipulation further asserted that PAR’s potential intervention interests should be barred due to its failure to intervene.

On October 11, 2017, a compensation judge approved the Stipulation for Settlement and issued an Award on Stipulation. The award included an order closing out PAR’s potential intervention interest for failure to intervene in the matter.

On October 16, 2017, PAR requested a Parker-Lindberg^[2] hearing, and thereafter retained the employee’s former attorney, Mr. Schultz. On April 11, 2018, instead of a Parker-Lindberg hearing, a compensation judge conducted an evidentiary hearing. The issues presented to the compensation judge included whether PAR had intervened in the underlying litigation.

By Findings and Order dated May 21, 2018, the compensation judge found that PAR did not effectively intervene in the matter, and concluded that PAR was not entitled to a Parker-Lindberg hearing and that the issue of whether PAR was effectively excluded from settlement negotiations was not properly before the court. Finally, the compensation judge concluded that the Award on Stipulation barred PAR from receiving payment for the rehabilitation services it provided to the employee. PAR appeals.

On appeal, the Workers’ Compensation Court of Appeals must determine whether “the findings of fact and order [are] clearly erroneous and unsupported by substantial evidence in view of the entire record as submitted.” Minn. Stat. § 176.421, subd. 1(3). Substantial evidence supports the findings if, in the context of the entire record, “they are supported by evidence that a reasonable mind might accept as adequate.” Hengemuhle v. Long Prairie Jaycees, 358 N.W.2d 54, 59, 37 W.C.D. 235, 239 (Minn. 1984). Where evidence conflicts or more than one inference may reasonably be drawn from the evidence, the findings are to be affirmed. Id. at 60, 37 W.C.D. at 240. Similarly, findings of fact should not be disturbed, even though the reviewing court might disagree with them, “unless they are clearly erroneous in the sense that they are manifestly contrary to the weight of evidence or not reasonably supported by the evidence as a whole.” Northern States Power Co. v. Lyon Food Prods., Inc., 304 Minn. 196, 201, 229 N.W.2d 521, 524 (1975).

A decision which rests upon the application of a statute or rule to essentially undisputed facts generally involves a question of law which the Workers’ Compensation Court of Appeals may consider de novo. Krovchuk v. Koch Oil Refinery, 48 W.C.D. 607, 608 (W.C.C.A. 1993), summarily aff’d (Minn. June 3, 1993).

It is well-established that an intervenor’s right to recover reimbursement of expenses incurred on behalf of an injured employee must be afforded adequate protection. Indeed, our supreme court has held that “an intervenor who is excluded from participating in negotiations resulting in a final settlement and who is not a party to the settlement stipulation should, on principles of equity and public policy, be awarded full reimbursement by the settlement award.” Brooks v. AMF, Inc., 278 N.W.2d 310, 315, 31 W.C.D. 521, 531 (Minn. 1979). It is further settled that an intervenor is entitled to an opportunity to be heard on the issue of whether the intervenor was effectively excluded from the settlement negotiations. Parker-Lindberg, 395 N.W.2d at 719.

The appellant, PAR, sought full reimbursement of its bills under these doctrines. However, the compensation judge concluded that PAR was not an intervenor and that the issue of whether PAR was effectively excluded from settlement discussions was not properly before her. The primary issue on appeal is, accordingly, whether the compensation judge erred in finding that PAR failed to effectively intervene and thereby become a party to the underlying litigation.

Minn. Stat. § 176.361, governs the procedure required to intervene in a worker’s compensation matter. Subdivision 2 of that statute provides, in pertinent part, that “[a] person desiring to intervene in a workers' compensation case as a party . . . shall submit a timely written motion to intervene to the commissioner, the office, or to the court of appeals, whichever is applicable” (emphasis added). This subdivision goes on to provide the specific requirements regarding the form, timing and service of a proper intervention motion.

At the hearing, PAR’s owner, John Richardson, acknowledged that PAR had not filed a written motion to intervene pursuant to this statute. PAR argues, however, that it effectively became an intervenor through the filing of a rehabilitation request at DLI on June 16, 2017. PAR relies on two prior cases from this court, Schumacher v. Pers. Staff Senior Care, 66 W.C.D. 53 (W.C.C.A. 2006), and Gebrekidan v. LSG Sky Chefs, Inc., 70 W.C.D. 71 (W.C.C.A. 2010).

In Schumacher and Gebrekidan, this court held that even in the absence of a formal intervention motion, a rehabilitation provider may become a party entitled to protections set forth in Brooks and Parker-Lindberg. In Schumacher and Gebrekidan, the provider’s filing of a rehabilitation request was a significant factor in this court’s conclusion that the provider had effectively intervened. PAR argues that the compensation judge was bound to follow those cases, and should have found that PAR was an intervenor entitled to a Parker-Lindberg hearing to determine whether PAR was effectively excluded from settlement negotiations, and if so, is entitled to full reimbursement of its bills.

In Schumacher, the employer and insurer accepted liability for the employee’s injury but asserted that it was merely temporary in nature. A rehabilitation provider, Mesabi Rehabilitation Services (Mesabi), began providing vocational rehabilitation services to the employee over the objection of an employer and its insurer, which filed rehabilitation requests seeking the termination of those services. The rehabilitation requests were consolidated with the issues raised for hearing by the employee’s claim petition.

Mesabi then filed its own rehabilitation request. Prior to the scheduled hearing on the consolidated pleadings, and while Mesabi’s rehabilitation request was still pending, the employee and the employer and insurer reached a settlement without notice to or participation by Mesabi. Mesabi filed a second rehabilitation request alleging entitlement to a Parker-Lindberg hearing to determine whether it had been excluded from the settlement negotiations. About a month later, prior to any action on Mesabi’s request for a Parker-Lindberg hearing, the Stipulation for Settlement was submitted to a compensation judge who issued an Award on Stipulation, including an order extinguishing the reimbursement rights of Mesabi for failure to intervene.

Mesabi petitioned this court to vacate the portion of the Award on Stipulation closing out its interests. Among other things, this court noted that the parties had failed to provide Mesabi with the notice of a right to intervene provided by statute. We concluded that, under the circumstances presented in the case, Mesabi had effectively become a party to the action by virtue of the rehabilitation request it had filed seeking payment of its bills, even though no formal intervention motion had been filed.

In Gebrekidan, an employee sustained an admitted work injury and PAR provided rehabilitation services. After the employer and insurer’s medical examiner concluded that the employee had improved to the point where no further treatment or work restrictions were required, the employer and insurer filed a rehabilitation request seeking termination of PAR’s services, and discontinued payment of the employee’s medical treatment.

The employee settled her claims against the employer and insurer. PAR closed its file due to the settlement, and filed a rehabilitation request seeking payment for the disputed services in the amount of $5,580.93. The employer and insurer objected to the request and alleged that the employee’s rehabilitation claims had been closed out in the Stipulation for Settlement. A month later, the stipulation was submitted for approval, and an Award on Stipulation was subsequently issued. PAR was not mentioned in the stipulation nor was it provided with a copy of the Award on Stipulation. PAR made multiple requests seeking a Parker-Lindberg hearing, which were ultimately denied on the basis that PAR had not formally intervened in the matter.

PAR appealed to this court. We held that, under the facts presented, and in light of Schumacher, PAR had effectively become a party to the matter by virtue of the rehabilitation request it had filed seeking payment of its bills.

In the case at hand, the compensation judge concluded that Schumacher and Gebrekidan presented distinguishable facts. Specifically, the judge noted those cases involved admitted injuries. Here, because the injury was not admitted, DLI rejected PAR’s rehabilitation request, refused to certify a rehabilitation dispute, informed PAR that no further action would be taken on its rehabilitation request, and advised PAR to contact the employee to determine whether there was a pending matter in which it might intervene. Also, unlike in Schumacher and Gebrekidan, PAR was put on notice of its rights as a potential intervenor to file a motion to intervene. PAR still took no action to intervene. Based on these factual distinctions, the judge concluded that Schumacher and Gebrekidan were not applicable to the present case.

PAR contends that the compensation judge erred in distinguishing the facts of the present case from those presented in Schumacher and Gebrekidan. It argues that this court should construe the holdings of those cases broadly and conclude that the filing of a rehabilitation request is, as a matter of law, the same as a motion to intervene. We decline to do so, and instead concur with the compensation judge’s analysis. Of particular significance is DLI’s denial of jurisdiction and refusal to certify PAR’s rehabilitation request. In both Schumacher and Gebrekidan, settlement discussions occurred while the rehabilitation requests filed by the providers were still pending. In fact, in both cases, the rehabilitation providers took additional action to seek payment before any stipulation for settlement was filed. It was reasonable for those rehabilitation providers to expect that their interests would be acknowledged by the other parties, and we concluded the protections of Brooks and Parker-Lindberg were appropriate. In the present case, DLI denied jurisdiction over PAR’s rehabilitation request, and instead sent a letter that specifically put PAR on notice that its claims were not effectively raised. Unlike the rehabilitation providers in Schumacher and Gebrekidan, PAR had no pending claims and did not seek payment until after the stipulation was submitted and approved and an award was filed.

Moreover, PAR was advised that its recourse was to determine whether there was a pending matter in which it could intervene. The employer put PAR on notice of its intervention rights. The providers in Schumacher and Gebrekidan were not given statutory notice of their rehabilitation rights.

Also, unlike in Schumacher and Gebrekidan, primary liability was denied. PAR acknowledged that in light of the denial of liability, it was providing rehabilitation services at the risk of not being reimbursed. To protect its right to assert a claim for payment and for inclusion at trial and in settlement discussions, PAR was required to intervene. It did not do so.

Under the circumstances presented here, we conclude that PAR was not a party because its filing of a rehabilitation request was rejected. Once jurisdiction of its rehabilitation request was declined, PAR’s only remaining recourse was to file a motion to intervene. Having failed to do so, its interests were properly extinguished.

Affirmed.