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Defense Digest

Attorneys Behaving Badly: Sanctions, Attorney’s Fees and Costs in Florida Workers’ Compensation Claims

Defense Digest, Vol. 29, No. 3, September 2023

September 1, 2023

by Heather Byrer Carbone

Key Points:

  • Florida workers’ compensation law allows for sanctions.
  • While Judges of Compensation Claims are generally hesitant to award sanctions, there are very limited circumstances where they will do so.

The vast majority of the time, the Florida workers’ compensation bar is a model of professionalism. There are more than 100,000 attorneys in the state of Florida, but the workers’ compensation bar is still small enough that everyone gets to know each other after practicing for a few years. They ask about kids and families. They celebrate weddings and share vacation pictures on social media. They are empathetic and move a deposition if someone is sick. Attorneys on opposite sides are friendly when encountering one another at conferences, seminars, and Inns of Court meetings. And it’s because of this genuine congeniality that most cases move through the system without overly antagonistic litigation. But there are always a few outliers. Judges of Compensation Claims (JCC) occasionally have to struggle with how to handle repeat violators as Florida workers’ compensation law does not have a bad faith clause. So how does a JCC send a message with some teeth when an attorney is unprofessional, overly aggressive, unresponsive, or hostile? Case law from the last few years has given us some guidance on what the First District Court of Appeals has found to be within the jurisdiction of the JCCs.

Florida workers’ compensation law allows for sanctions pursuant to DOAH Rule 60Q-6.125 by striking claims, petitions, defenses, and pleadings, or allowing for the imposition of costs or attorney’s fees. It also allows for other general sanctions that the JCC may deem appropriate. However, traditional F.S.57.105 sanctions that are available in civil cases are not applicable in administrative workers’ compensation claims, unless they are at an appellate level. 

In Mary Hektner v. School Board of Brevard County, OJCC# 13-014654RLD, 1st DCA 1D18-3792, PCA date April 15, 2019, counsel for the claimant had scheduled and noticed the adjuster’s deposition multiple times. A motion for protective order was filed and the employer/carrier’s attorney alleged that the deposition was going forward only to harass, annoy, or embarrass his adjuster and that there were very limited contested issues. The docket indicates extensive litigation and multiple issues appealed to the First District Court of Appeals. Relating to this adjuster’s live deposition, the attorney for the employer/carrier traveled from Orlando to Pompano Beach, stayed overnight in a hotel, and spent extensive time preparing the adjuster for the deposition. Counsel for the employer/carrier emailed claimant’s counsel three times and called multiple times, attempting to confirm that the deposition was going forward. Claimant’s counsel neither responded to the emails nor returned the calls. On the date of the deposition, he failed to appear in person or participate by phone. After the deposition was set to begin, claimant’s counsel’s office advised that the deposition was canceled. The employer/carrier then filed a motion for sanctions. The JCC ultimately found the circumstances warranted sanctions against claimant’s counsel only, and not the claimant. Pursuant to Florida Rules of Civil Procedure 1.310, the JCC awarded $3,661.50 for the employer/carrier attorney’s fees and $362.39 for costs. The First District Court of Appeals affirmed the decision per curiam. 

In a similar case, Carlos Santiago v. American Airlines, OJCC# 19-029788JIJ 1st DCA 1D20-2931 PCA date April 5, 2022, Premise, a health care provider, filed a motion for sanctions against a claimant’s attorney after the granting of a motion for protective order. The claimant’s attorney (the same attorney from the Hektner case mentioned previously) had filed a motion to compel better responses when asked to produce a contract between the defendant/employer and Premise. The employer/carrier objected on the basis of relevancy and trade secrets privilege, as it related to the workers’ compensation case. The JCC granted Premise’s motion for protective order, finding the contract was not reasonably calculated to lead to admissible evidence. The judge entered an order denying the claimant’s motion, and the claimant then filed a motion for rehearing. Premise responded by filing a motion for sanctions based upon F.S. 440.32(3), indicating that there was no good faith argument related to the modification of existing law. Additionally, Premise argued the purpose for the motion for rehearing was to harass or needlessly increase the cost of litigation. A motion for rehearing cannot re-litigate the same issue, unless there is some reversal of existing law. In this case, Premise incurred legal fees in excess of $100,000 defending this issue. The JCC found that claimant’s counsel filed the motion for rehearing for an improper purpose and that an appropriate sanction was to pay an attorney’s fee to Premise’s Health in the amount of $3,358. The district court affirmed the decision per curiam. 

On the other hand, in an evidentiary order on motion for sanctions in the case of Wilmer Hernandez Perez v. Seacrest Services/Travelers Insurance, OJCC #20-016176TAH dated March 2, 2023, the JCC found that it did not have enough evidence to warrant sanctions after the claimant missed four different depositions. The claimant appeared for the hearing on the motion for sanctions and testified that he was unaware of one of the dates of the deposition. Additionally, a Florida provision pursuant to DOAH Rule 60Q-6.125 provides that the party shall be served, but not filed, within 21 days of service of the motion for sanctions. This gives the allegedly offending party the ability to correct the deficiency and avoid the actual filing of the motion for sanctions. In the present case, the employer/carrier did not serve the motion on the claimant 21 days before filing it. The JCC, therefore, denied the motion for sanctions, indicating it was not a violation of the rules and the motion for sanctions was deficient. 

While Judges of Compensation Claims are generally hesitant to award sanctions, these cases show the (very limited) circumstances where they are pushed the edge to do so. The Florida workers’ compensation bar strives to maintain the collegial reputation that it has earned by avoiding the bad behavior outlined in the situations above and hoping that younger attorneys learn from these errors for the future. 

*Heather is a shareholder in our Jacksonville, Florida, office. She can be reached at 904.358.4225 or HBCarbone@mdwcg.com.
 

 

Defense Digest, Vol. 29, No. 3, September 2023, is prepared by Marshall Dennehey to provide information on recent legal developments of interest to our readers. This publication is not intended to provide legal advice for a specific situation or to create an attorney-client relationship. ATTORNEY ADVERTISING pursuant to New York RPC 7.1. © 2023 Marshall Dennehey. All Rights Reserved. This article may not be reprinted without the express written permission of our firm. For reprints, contact tamontemuro@mdwcg.com.

Firm Highlights

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Jack Slimm and Jeremy Zacharias obtained a favorable decision on behalf of their client in a case centering on the admissibility of expert testimony in legal malpractice actions. In Martin v. Loury, the New Jersey Appellate Division affirmed the exclusion of a plaintiff's legal malpractice expert, holding that the expert's opinions on causation and damages were too speculative to support the malpractice claim. The legal malpractice action arose from an underlying employment dispute involving claims for damages stemming from the breach of an employment agreement. The plaintiff alleged that defense counsel committed malpractice during a second trial by failing to recall the plaintiff as a rebuttal witness after the employer's CEO testified. According to the plaintiff's expert, additional rebuttal testimony would have bolstered the plaintiff's damages claims and led to a more favorable result. Both the trial court and the Appellate Division rejected that theory. The courts found that the expert could not explain how the proposed rebuttal testimony would have altered the outcome of the underlying case or resulted in any additional recoverable damages. Notably, the trial judge in the underlying employment matter had already rejected the CEO's testimony as not credible and had accepted the damages analysis advanced by the plaintiff. The court had also determined that the amount of damages was not genuinely disputed. As a result, the expert's opinion that additional rebuttal testimony would have produced a better outcome was unsupported by the record and based on speculation rather than evidence. The Appellate Division agreed that neither the plaintiff nor the expert could identify any actual damages attributable to the alleged malpractice or demonstrate the required element of proximate causation. The court further upheld the trial court's application of New Jersey's net opinion doctrine, finding that the expert failed to provide the necessary "why and wherefore" supporting his conclusion that the attorney's conduct caused a compensable loss. Because the opinions rested on unquantified possibilities rather than demonstrable facts, they were inadmissible. Key Takeaway for Legal Malpractice Defendants For attorneys and firms defending legal malpractice claims, Martin v. Loury underscores the importance of closely scrutinizing an opponent's expert report on the critical elements of proximate causation and damages. The decision demonstrates that a malpractice claim cannot survive where an expert merely speculates that different litigation tactics might have produced a better result. Instead, the plaintiff must present admissible expert testimony grounded in the record that explains how the alleged attorney error probably changed the outcome of the underlying matter and resulted in measurable damages.

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Thought Leadership

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RI Settlement arose out of four separate civil complaints in which the underlying plaintiffs alleged that, as minors, they were the victims of human sex trafficking at various hotels in Philadelphia. The plaintiffs claimed that the hotel owners were negligent in failing to stop the sex trafficking from happening at their hotels. After the filing of the lawsuits, the hotel owners sought coverage under their Commercial General Liability policies. The insurers initially defended the hotels under Reservation of Rights letters, though the carriers later filed Declaratory Judgment actions seeking declarations that they did not owe a duty to defend or indemnify. In short, the insurers argued in the alternative that they did not owe any obligation to provide coverage based upon Pennsylvania public policy (because the claims violated the Human Trafficking Law – 18 Pa.C.S. § 3011) and the terms and conditions of the policy. On motions for judgment on the pleadings, the District Court found for the insurers on the basis of public policy: There is no duty to defend or indemnify against actions arising out of an insured's criminal conduct related to the sex trafficking of minors. The Court appreciates that it may make public policy the basis of a judicial decision only in “the clearest of cases.” See Minnesota Fire & Cas. Co. v. Greenfield, 589 A.2d 854, 868 (Pa. 2004) (quoting Hall v. Amica Mut. Ins. Co., 648 A.2d 755, 760 (Pa. 1994)). Yet, the Court strains to imagine a clearer case than the one presented here in which the facts alleged indicate that Policyholders engaged in criminal conduct in violation of Pennsylvania's Human Trafficking Law. The hotel owners appealed the matter to the Third Circuit, which petitioned the Supreme Court of Pennsylvania to grant review of two certified questions of law: (1) whether Pennsylvania law had an “overriding public policy” against sex trafficking, such that an insurer’s duty to defend and/or indemnify is abrogated when an insured is alleged to have enabled or profited from such trafficking; and (2) if yes, is that duty abrogated whenever the insured’s alleged conduct would constitute a violation of the Pennsylvania Human Trafficking statute. Importantly, the certified questions did not ask the Supreme Court to determine whether the policies afforded coverage under their terms. Rather, the court was asked only whether Pennsylvania public policy independently barred coverage. As a result, the court assumed for purposes of answering the certified questions that the insurers otherwise owed a duty to defend and addressed only the public policy issue, leaving all policy-based coverage defenses for further proceedings. Because the court concluded that the answer to the first certified question was “no”, it did not reach the second issue. In reaching its determination that Pennsylvania public policy does not prohibit insurance coverage for sex trafficking claims, the court limited the impact of its decision in Minnesota Fire & Cas. Co. v. Greenfield, 855 A. 2d 854, 855 (Pa. 2004), which the RI Settlement opinion emphasized as having been an “Opinion Announcing Judgment of the Court” – or a plurality opinion. In Greenfield, the insured homeowner was sued by the estate of his houseguest who overdosed from heroin that he sold to her. 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