DANIEL M. ANSELLO, Employee/Appellant, v. WIS. CENT., LTD. and DISCOVER RE RISK MGMT., Employer-Insurer/Respondents, and ESSENTIA HEALTH SYS., Intervenor.

The employee appeals the amount of attorney fees awarded by the compensation judge.  As the award of attorney fees in this case is within a reasonable range given the record, we conclude the compensation judge did not abuse his discretion, and we affirm.

On January 29, 2006, Daniel Ansello, the employee, sustained an admitted low back injury while employed by Wisconsin Central, Ltd., as a longshoreman at the Duluth Ore Docks.  Indemnity and medical expense payments were initiated under the Longshore and Harbor Workers’ Compensation Act, 33 U.S.C. § 901 et seq. (LHWCA), including payment for two low back surgeries in March 2006 and April 2009.  The employer’s insurer for LHWCA benefits was Signal Mutual Indemnity Association.

The employee aggravated his low back at work on August 1, 2014.  He underwent previously scheduled low back fusion surgery on September 3, 2014.  Wage loss benefits were paid under the LHWCA from August 19 through November 9, 2014, based on the August 1, 2014, aggravation, but medical expenses related to the third low back surgery were denied based on the assertion that the surgery was not reasonable or necessary.

The employee filed a medical request under the Minnesota Workers’ Compensation Act (MWCA) seeking payment of medical expenses allegedly arising from the January 29, 2006, work injury, including expenses related to the third surgery.  The employer's insurer for Minnesota workers’ compensation liability was Discover RE Acclaim Risk Management.  The employee had the same attorney for the LHWCA and the MWCA claims.

In his Findings and Order dated April 5, 2016, the compensation judge dismissed the employee’s workers’ compensation claim for lack of jurisdiction, holding that the LHWCA fully compensated the employee for needed medical care and treatment and that the medical expenses claimed by the employee under the MWCA would supplant the benefits available under the LHWCA.  The compensation judge also concluded, given the employee’s previous claims for this injury under the LHWCA, that the Minnesota workers’ compensation system was not the appropriate venue to litigate the current medical expense claims under the doctrine of forum non conveniens.  The employee appealed the decision to this court, which reversed and remanded, holding there was concurrent jurisdiction under the MWCA and the LHWCA over the employee’s claims.  The Minnesota Supreme Court affirmed this court’s decision.^[1]  The employee’s attorney was awarded $3,500.00 in fees from this court and $3,500.00 in fees from the supreme court.

In September 2017, a federal administrative law judge (ALJ) awarded certain medical expenses billed from an intervenor under the LHWCA, leaving the amount payable undetermined.  A few months later, the ALJ awarded the employee’s attorney $37,199.66 in attorney fees for the LHWCA claim and awarded an additional $5,085.00 in attorney fees and expenses for representation of the employee for that claim at the program level.  The employer and insurer contend that they spent the next year and a half working with the intervenor to comply with the ALJ’s order, but no payments were made during that time.

In December 2018, the employee filed a claim petition under the MWCA for an additional amount of permanent partial disability (PPD) benefits, which was voluntarily paid in May 2019 with $4,190.00 in attorney fees withheld.  The parties settled the medical expenses payable to the intervenor in August 2019 but with attorney fees left open. 

In June 2019, the employee’s attorney filed a statement of attorney fees claiming an additional $59,025.00 in attorney fees for medical expenses recovered and for fees under Minn. Stat. § 176.081, subd. 7.  Following a hearing on November 4, 2019, the compensation judge awarded $12,000.00 in Irwin fees, ordered the release of the fees withheld from the PPD award, and awarded subd. 7 fees of $3,525.00 and $1,257.00.  The employee appeals the amount of the Irwin fee award.

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).

Under Minn. Stat. § 176.081, contingent fees are payable to the employee’s counsel for obtaining benefits on behalf of the employee and are generally presumed to be adequate compensation for recovery of benefits.  Additional fees may be assessed where the contingent fees payable are inadequate to reasonably compensate the attorney for the representation provided.^[2]  In this case, the employee’s attorney requested additional fees for representation of the employee in his MWCA claim.  In determining an award for additional fees, the compensation judge must consider the factors set out in Irwin, including “the amount involved, the time and expense necessary to prepare for trial, the responsibility assumed by counsel, the experience of counsel, the difficulties of the issues, the nature of the proof involved, and the results obtained.^[3]  The question of whether the compensation judge applied the appropriate legal analysis is reviewed de novo.^[4]  Where the compensation judge performed the correct legal analysis, an attorney fee award is reviewed for an abuse of discretion.^[5]

In the present case, the compensation judge determined that an additional fee under Irwin was appropriate.  The judge concluded that the amount of fees awarded under the LHWCA sufficiently compensated the employee’s attorney for proving entitlement to payment of the medical expenses in that forum.  The compensation judge thus excluded the time expended by the employee’s attorney for the LHWCA litigation from his calculation of an appropriate Irwin fee.  In his memorandum, the compensation judge reasoned that the efforts of the employee’s attorney in the Minnesota workers’ compensation action established the employee’s right to bring a claim in either or both jurisdictions.  The judge determined that about 40 hours of additional time was attributable to this jurisdictional challenge and based his award of Irwin fees on that number of hours.

The employee argues that the compensation judge erroneously considered attorney fees awarded in another forum and thereby failed to properly apply the Irwin factors, resulting in an inadequate award of excess fees.  The compensation judge stated, “it would be improper to award fees under two separate jurisdictions for recovery of the same medical expense.”^[6]  The employee contends that this language demonstrates that the judge improperly applied a credit against the fee awarded from the amount paid under the LHWCA.  We disagree.

Minnesota case law has not directly addressed whether such a credit may be appropriate.  The employee cites three cases from other jurisdictions which he contends this court should find persuasive on this issue.  After reviewing these cases, we conclude none of these cases are directly on point.  Though cited by the employee, the Sea-Land case does not deal with the coordination of attorney fee awards.  In Sea-Land, the California Supreme Court concluded that a claimant is limited to the total amount of whichever award, federal or state, is monetarily greater, without regard to the types of benefits each award provided.^[7]  In Landry and Lustig, the other two cases cited by the employee, the holdings rested on the interpretation of a federal statute applicable to fees awarded under the LHWCA and not under a state workers’ compensation claim.^[8]  We are not persuaded that these cases support the employee’s position.

The compensation judge's determination upholds an underlying principle in Minnesota workers’ compensation law of avoiding double recovery of workers’ compensation benefits.^[9]  In Ansello, the Minnesota Supreme Court noted that no double recovery would occur through allowing concurrent LHWCA and MWCA jurisdiction because recovery in either forum would be credited against any recovery in the other forum.^[10]  Although these cases address double recovery of benefits rather than of fees, we see no reason why the policy against double recovery should not extend to fee awards.

We next address the reasonableness of attorney fees awarded under the application of the Irwin factors.  A compensation judge need not award fees for all of the hours claimed by an attorney even where all of the time was reasonable and necessary.^[11]  None of the Irwin factors alone are determinative.  The issue is whether the amount awarded was reasonable considering all of the Irwin factors.^[12]

It is clear that the compensation judge considered all of the Irwin factors in determining the amount of the fee award.  Noting that proof of entitlement for payment of the medical expenses was similar for both claims, he deemed the amount of fees awarded under the LHWCA sufficient to compensate the employee's attorney for proving that entitlement.  The judge concluded that the primary legal dispute before him was jurisdictional, making the factors regarding the amount of time involved in the medical claim less relevant to the determination of the Irwin fees.  He found that the employee’s attorney had substantial experience and expertise in workers’ compensation cases, and had assumed the responsibility to establish the employee’s right to pursue his claim under the MWCA.  The judge further considered the difficulty of the issue involved as demonstrated by the number of motions filed by the employer and insurer and the length of time involved in the dispute which ended in a favorable result for the employee.  The judge reasonably concluded that approximately 40 hours of additional time was expended on activities related to the jurisdictional challenge and awarded Irwin fees on that basis.  Given the facts and circumstances of this case, we cannot conclude the compensation judge abused his discretion, and we affirm.