The Workers' Compensation Practice Group is devoted to the exclusive representation of employers, insurance carriers and third party administrators. While many of the attorneys in this group have a background in civil litigation, they all focus their practice solely on the defense of workers' compensation matters. Our attorneys are well versed in the intricacies of this nuanced practice, and due to their constant presence in the courts where they practice, they are well respected by the judges before whom they regularly appear and the attorneys against whom they compete.
Our attorneys are involved in all aspects of workers' compensation, from the infancy of a claim through practice in the appellate courts. We are vigorous litigators who also recognize that litigation is not always the primary focus of an employer's successful workers' compensation program. Significant monetary savings can be achieved through the effective management of workers' compensation plans and innovative return-to-work programs, and our attorneys are on the cutting edge of case law developments to assist in the design, implementation and continuation of such programs. We also provide risk management services and can help reduce costs by becoming involved during the pre-litigation phase. In addition, the work of the attorneys in the firm's highly regarded Appellate Advocacy and Post-Trial Practice Group includes front-line responsibility for conducting necessary legal research, writing required briefs, and preparing and presenting oral arguments in post-trial motions and appeals.
As workers' compensation has become increasingly sophisticated, we have expanded our scope of practice to support clients in areas that have become tangential to the workers' compensation practice.
Workers' Compensation Fraud
Fraud contributes significantly to the cost of doing business and negatively impacts employers, insurance carriers and third party administrators. We can facilitate the filing of a fraud claim through local government agencies and review all cases for civil remedies to help our clients recoup some of the monies expended due to fraudulent cases.
Unemployment Compensation
It has become increasingly apparent that there is a cross-over between workers’ compensation and unemployment cases. While the two areas of law are mutually exclusive by way of collateral estoppel, it is clear the same issues are simultaneously being litigated in both forums. By using the unemployment and workers’ compensation forums to bolster defenses in both claims, we achieve successful results for our clients. Our unemployment practice is full service, with our attorneys handling claims at all levels of the courts.
Federal Black Lung
Our attorneys defend claims brought before the United States Department of Labor (USDOL) by coal miners and widows seeking benefits under the Black Lung Benefits Act. We are intimately familiar with the lengthy litigation process involved with Federal Black Lung claims originating at the USDOL and proceeding to a hearing before an Administrative Law Judge. Our attorneys have also handled numerous appeals to the Benefits Review Board and the United States Court of Appeals. We are also well versed in defending pulmonary disease cases under the Pennsylvania Workers’ Compensation Act that often go hand-in-hand with claims brought under the Black Lung Benefits Act.
Hearing Loss Claims
Injuries resulting from exposure to hazardous occupational noise comprise one of the largest group of specific loss/permanency claims in the tri-state area. In addition to becoming more commonplace, these claims have also become more technologically complex. Each attorney assigned to hearing loss claims are familiar with the science behind acoustical trauma, including the inner workings of audiometric testing, leading to effective cross examination of key witnesses. Further, our attorneys seek to expose pre-existing, non-work related hearing loss and differentiate it from compensable loss. We are one of the leading defense firms in protecting successor-in-interest employers that are unexpectedly plagued with hearing loss claims stemming from employees’ hazardous noise exposure with previous employers. In Pennsylvania, we were pioneers in the effort to change the standard of monetary award in hearing loss cases from an all-encompassing specific loss award to that of a percentage award based on actual work-related hearing loss. Our attorneys are also well versed in the practical implications of a working hearing conservation program and the benefits such a program can have on an employer’s bottom line.
Medicare Compliance
Our Medicare team has the comprehensive knowledge necessary to effectively handle set-asides in all parts of the country. We are well-versed in federal and state liability systems, as well as the workers’ compensation systems. In addition to protecting Medicare’s interests through set-asides, we also alert our clients to the involvement of the State Children’s Health Insurance Program (SCHIP) Reporting Law. We offer cogent advice regarding case settlements, including the use of structured settlements and other strategies to bring cases to conclusion. We are willing and able to work with lawyers throughout the country to provide the support they need regarding Medicare issues.
Coverage
Occasionally, carriers are drawn into workers' compensation litigation notwithstanding a dispute between the employer and the carrier as to viable workers' compensation coverage. Our attorneys have experience in navigating the potential pitfalls that can arise during litigation due to the conflicting interests of the employer and the carrier, and have successfully obtained dismissals of carriers as parties from these unwarranted claims.
Interplay Between the ADA, FMLA and Workers' Compensation
Our attorneys have expansive knowledge of the ADA, FMLA and workers’ compensation statutes that all impact termination of employment. We fully understand the complex relationship between these statutes and provide our clients the necessary guidance during the pre-litigation phase. We also advise our clients on the potential impact of a wrongful termination and provide detailed recommendations to facilitate a lawful employment termination. Our legal approach focuses on mitigating future exposure by providing practical advice to avoid pitfalls when navigating the decision to terminate an employee. We work with our clients to evaluate and address all legal issues involving the ADA, FMLA and workers’ compensation as it pertains to avoiding a wrongful termination claim.
Medical Marijuana
There has been a wave of medical marijuana legalization throughout the country in recent years. It is now legal in more than 38 states, including ones where we defend clients in workers’ compensation matters. Our attorneys are knowledgeable about the medical marijuana laws in these specific states and can provide sound advice on the many issues that arise in the workers’ compensation context. Some of these issues include insurance coverage, payment, reasonableness and necessity of medical cannabis treatment for work injuries, work injuries that qualify as conditions treatable with medical cannabis, and workplace safety concerns. We are also committed to tracking important trends in medical marijuana law nationally to keep our clients well informed of significant developments and the impact they may have on the practice of workers’ compensation.
Defense Base Act
The Defense Base Act (DBA) extends protections to civilian employees working outside the United States on U.S. military bases or under contracts with the U.S. government involving public works or national defense. It provides comprehensive medical, disability, and death benefits to covered employees who suffer injuries or fatalities arising out of and in the course of employment. Our attorneys have a deep understanding of the complex regulations and procedures governing DBA claims. We deliver strategic, results-driven representation at every stage of the process—from claim investigation and mediation through formal hearings and appeals before the Benefits Review Board, U.S. District Courts, and U.S. Courts of Appeals. Our goal is to protect our clients’ interests while minimizing the risks and financial exposure associated with Defense Base Act claims.
Longshore and Harbor Workers' Compensation
We understand the legal, operational, and financial challenges employers, insurers, and maritime companies face when responding to Longshore and Harbor Workers’ Compensation Act claims. Our attorneys bring extensive experience litigating before the U.S. Department of Labor, the Office of Administrative Law Judges, the Benefits Review Board, and the U.S. Courts of Appeals. Working closely with clients, investigators, and medical and vocational experts, we develop disciplined, evidence-driven defenses tailored to the facts of each case. We provide proactive, results-focused representation at every stage of the process—from initial claim evaluation through trial and appeal.
PENNSYLVANIA
Fee Reviews
Fee reviews have become an increasingly important component of workers' compensation cases in Pennsylvania. Our attorneys are very familiar with the legal issues associated with the fee review process and its interplay with active workers’ compensation litigation. By becoming involved at the onset of a fee review filing, we are better positioned to defend the interests of employers/carriers. Medical providers use fee reviews to challenge the timeliness or amount of medical payments made by employers/carriers. Providers are given two opportunities to file a timely application for fee review – (1) within 90 days of their original billing date, or (2) within 30 days after they are provided with notice of a dispute, whichever is later. The fee review process presupposes that liability has been established, and thus, provider's allegations are accepted at face value during the initial stages. As an unfortunate consequence, employers/carriers may face unjust initial Determinations. Disputing a fee review Determination requires a de novo appeal, which must be filed within 30 days of the date of the Determination. Our attorneys have extensive experience navigating the issues that then arise during fee review hearings and provide excellent guidance based on our thorough understanding of CPT codes and types of treatment. Our goal is to handle each case in an efficient and cost-effective manner.
Heart and Lung Benefits
In addition to handling traditional workers’ compensation claims, our attorneys also advise local municipalities and counties in Pennsylvania on heart and lung claims. The Heart and Lung Act provides full wage loss benefits to certain eligible municipal, county and state workers who are injured in the performance of their job duties. With a depth of experience in this area, we are well versed in the associated law and adept at defending clients facing these types of claims. Our attorneys understand the complex interplay between the Heart and Lung Act and the Workers’ Compensation Act, and will provide the necessary guidance in pre-litigation settings, address all issues to challenge entitlement to Heart and Lung benefits, and explain its impact on a workers’ compensation claim. Our approach focuses on mitigating future exposure and providing practical advice to avoid pitfalls in handling Heart and Lung Act claims. We work with our clients to evaluate and achieve reasonable resolution of both the heart and lung and worker’s compensation claims, as well as address any subrogation issues.
FLORIDA
Stop Work Orders
Stop Work Orders or Requests for Business Records are issued by the Division of Workers’ Compensation Investigators for the state of Florida. A business cannot legally operate while a Stop Work Order is in place. Failure to comply with a Stop Work Order can result in increased penalty assessments and, in some cases, criminal sanctions pursuant to Florida Statute 440.105. Our attorneys can assist business owners in navigating this difficult and complicated process, including record requests, reducing penalty assessments and filing petitions before Department of Administrative Hearings.
Insurance Premium Audits and Disputes
Disputes occasionally arise between employers and carriers after an audit takes place. Workers’ compensation rates in Florida are based upon job title and payroll, and discrepancies discovered following an audit can lead to loss of coverage, fines and assessments. We can assist employers throughout this dispute process, which can lead to improved outcomes and reduced assessments.
Results
Defense Verdict Obtained Involving an Employment-Related Shoulder Injury
Defense Verdict Secured in a Case Centered on an Employment-Related Low Back Injury
We received a defense verdict on our termination petition in a case where the claimant sustained a low back injury when he slipped and fell in an elevator during his employment. The employer had an IME wherein the claimant was pronounced fully recovered from strain injuries. The claimant presented evidence that alleged disc injury and ongoing radiculopathy. The matter proceeded to litigation and a decision on the merits. The court found the employer’s expert to be credible as to full recovery based on the finding that no architectural change could be identified between the claimant’s diagnostic studies when compared to studies from before and after the work injury.
Events
Thought Leadership
What's Hot in Workers' Comp
What's Hot in Workers' Comp - 2024 to present
December 31, 2026
Our monthly workers’ compensation publication provides legal updates and practical analysis of developments affecting employers, insurers, and claims professionals. Each issue highlights recent case law and statutory and regulatory changes to help readers stay informed, manage risk, and respond effectively to evolving workers’ compensation requirements. What's Hot in Workers' Comp, June 2026 What's Hot in Workers' Comp, May 2026 What's Hot in Workers' Comp, April 2026 What's Hot in Workers' Comp, March 2026 What's Hot in Workers' Comp, February 2026 What's Hot in Workers' Comp, January 2026 What's Hot in Workers' Comp, December 2025 What's Hot in Workers' Comp, November 2025 What's Hot in Workers' Comp, October 2025 What's Hot in Workers' Comp, September 2025 What's Hot in Workers' Comp, August 2025 What's Hot in Workers' Comp, July 2025 What's Hot in Workers' Comp, June 2025 What's Hot in Workers' Comp, May 2025 What’s Hot in Workers’ Comp, April 2025 What’s Hot in Workers’ Comp, March 2025 What’s Hot in Workers’ Comp, February 2025 What’s Hot in Workers’ Comp, January 2025 What’s Hot in Workers’ Comp, December 2024 What’s Hot in Workers’ Comp, November 2024 What’s Hot in Workers’ Comp, October 2024 What’s Hot in Workers’ Comp, September 2024 What’s Hot in Workers’ Comp, August 2024 What’s Hot in Workers’ Comp, July 2024 What’s Hot in Workers’ Comp, June 2024 What’s Hot in Workers’ Comp, May 2024 What’s Hot in Workers’ Comp, April 2024 What’s Hot in Workers’ Comp, March 2024 What’s Hot in Workers’ Comp, February 2024 What’s Hot in Workers’ Comp, January 2024
Defense Digest
Don’t Waive Goodbye to Your Section 40 Lien Rights
June 30, 2026
Key Points: Under NJ workers’ compensation law, employers can assert a lien upon third-party actions for any medical and indemnity benefits paid. The employers are free to compromise or waive this lien. The Appellate Division found that a carrier cashing a check for less than the full lien amount, but accompanied by a letter stating this payment was full and final payment of the lien, constituted an agreement to waive the remainder of the lien. A chief concern of the workers’ compensation system in New Jersey has always been prevention of double recovery, in which an injured worker would obtain a “windfall” by receiving compensation from both a workers’ compensation claim and a third-party suit. In order to avoid this, the Workers’ Compensation Act provides the respondent with a lien against third-party proceeds. Known as the “Section 40 lien,” the respondent can assert a lien based on the medical and indemnity benefits it has issued for the workers’ compensation claim. The lien can be collected upon two-thirds of the third-party recovery, minus $750.00 for the costs of suit. As with most liens, a Section 40 lien can be negotiated. Employers will sometimes agree to compromise or, in some cases, even waive the lien. In the recent unpublished case of Tomaselli v. Petco, 2026 WL 585448 (N.J. Super. App. Div. April 3, 2026), the Appellate Division addressed a dispute as to whether an employer’s Section 40 lien had been compromised. In the case, the petitioner was employed as a store manager at Petco (insured by Sedgwick). On December 23, 2017, he was collecting shopping carts in the store’s parking lot when a car backed into him, causing injuries to his lower back. Since the petitioner was injured by a third-party tortfeasor in the course of his employment, he filed both a workers’ compensation claim against Petco and a suit against the driver. The third-party suit ended with a settlement of $85,000 in underinsured motorist (UIM) benefits and $15,000 in third-party settlement. At the time of resolution of the civil claim, Sedgwick had paid a total of $177,084.30 in benefits ($90,351.50 in medical and $86,732.80 in indemnity). This amount was not exhaustive, as the petitioner was still undergoing treatment and the costs would continue to increase. At that point, Sedgwick was entitled to recoup over $65,000.00 from the third-party settlement. However, in the spirit of compromise, they sent the petitioner a letter indicating that they would accept $33,333.33 from the UIM award and $15,000.00 from the third-party settlement. The petitioner’s lawyer sent a check to Sedgwick for $33,333.33 with a letter stating the check “represents full and final payment of any outstanding worker's compensation lien, in connection with the above-referenced claim." The check was cashed by the carrier. The workers’ compensation matter subsequently went to trial and ended with a judgment from the judge of compensation finding a percentage of permanent disability and further concluding that Sedgwick’s acceptance of the check for $33,333.33 with the aforementioned letter constituted an agreement to resolve the lien for only that amount. On appeal, Sedgwick argued that the mere act of cashing a check did not constitute a waiver of its Section 40 lien rights. The Appellate Division ruled that it did. They stated that Sedgwick was clearly aware of its rights to recover the full amount allowable under their Section 40 lien, and that “[b]y accepting and endorsing the check, Sedgwick clearly and unequivocally conveyed its intent to accept $33,333.33 as full and final payment of any outstanding workers' compensation lien.” While this is an unpublished opinion and therefore not binding, it will likely have persuasive authority for judges of compensation going forward. The impact of this case is significant. At most corporations, the high volume of checks received in the mail are sorted, endorsed, and deposited by an accounts receivable department or comparable business unit. However, in this opinion, the Appellate Division is ascribing significant decision-making authority to the action of one who is likely not a corporate officer, but a clerk. What are some actions that carriers can take to safeguard their Section 40 liens and prevent an unintentional waiver of same? The first is to enact policies requiring supervisory approval before any check pertaining to a Section 40 lien repayment is deposited. Systems should be enacted which will lead to any check pertaining to Section 40 lien repayment being flagged, and requiring a supervisor to review and approve before it is deposited. If there is no language on the check or accompanying paperwork indicating anything about “full and final” or “resolution” or “waiver” or any other terms to that effect, the check can be deposited without issue. If there is such language, consultation should be made with the workers’ compensation adjuster, defense counsel, or another designated party that can verify the full amount of the carrier’s Section 40 lien and determine whether any negotiated amounts have been agreed to by the carrier.If the check with such language is in the full amount (or the negotiated amount, if applicable), the check can then be deposited. If the check is for a lesser amount, it should be immediately sent back with a letter copying all pertinent parties, stating that the carrier is entitled to (state the full dollar amount of entitlement) and does not agree to accept a lesser amount. The carrier should then ask the addressee to advise whether they will be re-sending the proper amount or whether further legal action will be required. A second suggestion would be to designate that such checks need to be sent to defense counsel. This would task the carrier’s legal team with the job of verifying that endorsement of the checks does not unintentionally cause a waiver of lien rights. After review, the defense counsel can then pass the check on to the carrier or send back to the addressee, as the situation requires. A third cautionary step would be to issue a notice to petitioner’s attorney, indicating that the carrier is asserting its full lien rights under N.J.S.A. 35:15-40 and that going forward, the carrier does not consent to any compromise of its full entitlement unless noted in a formal agreement signed by both parties. While the service of this document by itself would be helpful, it would be optimal for it to be signed by petitioner’s attorney. Since the carrier is normally asked to produce a ledger showing the amount of its Section 40 lien, petitioner’s attorney should be told that production of the requested ledger will only be made upon receipt of the notice with their (the attorney’s) signature. The Tomaselli opinion has exposed a vulnerability in respondent’s rights to assert their full Section 40 liens they are entitled to under law. The carriers are entitled to recoup monies spent on medical and indemnity benefits. They should act with great care to ensure that entitlement isn’t lost through error. William J. Murphy is in our Roseland office. He can be reached at (973) 618-4129 or at wjmurphy@mdwcg.com.
