.

What's Hot in Workers' Comp

Court of Appeal Holds that Judges of Compensation Claims Lack Jurisdiction Over Employer/Carrier Paid Costs and Have Limited Role in Reviewing employer/Carrier Paid Fees

Fox v. Sarasota County School Board, Fla. 1st DCA, No. 1D2023-3093, June 25, 2025

August 1, 2025

by Blake J. Hood

The First District Court of Appeal issued an opinion that clarifies the extent of a Judge of Compensation Claim’s (JCC’s) discretion, and even jurisdiction, to review attorney fees and costs paid by employers/carriers. In Fox v. Sarasota County School Board, the district court held that a JCC’s role in approving employer/carrier-paid attorney fees for benefits secured under Florida Statutes Section 440.34(1) extends to only reviewing the amount of rather than entitlement to attorney fees. The court stated that JCCs have no jurisdiction whatsoever over employer/carrier-paid costs. The opinion may have sweeping implications for settlement negotiations and the role of JCCs in approving “side stipulations” to employer/carrier-paid attorney fees and costs.

In practice, settlement negotiations frequently commence with astronomical demands followed by similarly unrealistic opening offers. Over time, these coalesce to some middle ground figure to which both sides agree. The actual dollar amount for settlement is ostensibly based upon the parties’ calculations of the economic exposure of the claim remaining open and the consequential future medical and disability benefit payments. However, parties to a settlement must also account for intangible factors, rather than simple arithmetic. Economic evaluations of a case often center on, for example, questions of witness credibility and subtle differences in medical expert opinions. The result is that claimants and employers/carriers may arrive at a dollar amount for settlement that each side can live with based on various factors; each side may arrive at the same destination while on different journeys. 

As in the Fox case, employers/carriers may agree to a bottom-line settlement figure and not care “how it’s divided up” between the settlement of the underlying claim and attorney fees and costs, if there is a claim for employer/carrier-paid fees under Florida Statutes Section 440.34(1).

However, as noted by the JCC in the Fox case, attorneys are not free sign pleadings without a basis in fact or law. Florida Statutes provide:

Every pleading, motion, and other paper of a party represented by an attorney shall be signed by at least one attorney of record in the attorney’s individual name, whose address shall be stated. The signature of an attorney constitutes a certificate by the signer that the signer has read the pleading, motion, or other paper; that to the best of the signer’s knowledge, information, and belief formed after reasonable inquiry it is well grounded in fact and is warranted by existing law or a good faith argument for the extension, modification, or reversal of existing law, and that it is not interposed for any improper purpose…

Section 440.32(3), FLA. STAT. (2024).

The appeal in Fox followed a scathing 70-page JCC order detailing at great length the JCC’s finding that attorney fees stipulated to by the parties should not have been approved. The JCC went so far as to find the stipulated attorney fee petition to be a “sham” and entered a show cause order requiring both the claimant’s attorney and the employer’s/carrier’s attorney to explain why each should not be sanctioned. 

At the trial level, the attorney for the employer/carrier explained that the parties reached a settlement in the amount of $200,000. He then received a “breakdown” from the claimant’s attorney, which allocated a large portion for employer/carrier-paid attorneys fees and costs with the remainder going to the claimant. The final allocation as between the settlement of the underlying claim (“washout settlement”) versus the employer/carrier-paid attorney fees (“side stipulation”) was as follows:

Washout:
•    $114,900 (out of which the claimant’s attorney would receive $12,240 in attorney fees but not costs)

Side Stipulation:
•    $60,308.72 for employer/carrier paid attorney fees;
•    $24,691.28 for employer/carrier paid costs. 
(Presumably $100 was allocated for a separate General Release)

Counsel for the employer/carrier filed the washout paperwork first, and the JCC approved the same. Later that day, the side stipulation for the employer/carrier-paid fees was filed, which the JCC refused to approve. Instead, he entered a Notice of Deficiency. The JCC held two contentious hearings at which the attorneys for the claimant and employer/carrier testified. 

In his order denying the side stipulation for fees and costs, the JCC took both attorneys to task and asked them to explain on what colorable basis there was for entitlement to employer/carrier-paid attorney's fees under Florida Statutes. The JCC found that the fees claimed often related to events that did not occur or to benefits that, in the JCC’s opinion, were timely provided so as to avoid attorney fee entitlement. The JCC ultimately determined that there was no entitlement to employer/carrier-paid attorney fees or costs.

The First District Court of Appeal in a per curiam opinion set aside the JCC’s order. The district court held that the JCC was obligated to follow the parties’ stipulation to fee entitlement in the absence of fraud, overreaching, misrepresentation or some other basis that would void the agreement. The district court said that, while the JCC found no factual or legal basis supporting attorney fee entitlement or entitlement to taxable costs, such a finding was insufficient under prior case law. The court also clarified that “JCCs have no jurisdiction at all” over employer/carrier-paid costs.

While JCCs have recently been scrutinizing such side stipulations when filed in conjunction with washout settlements, the Fox case limits their role in reviewing questions of attorney fee entitlement. JCCs retain the authority and obligation, however, to review the amount of fees being claimed. 

 

What’s Hot in Workers’ Comp, Vol. 29, No. 8, August 2025, 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. We would be pleased to provide such legal assistance as you require on these and other subjects when called upon. ATTORNEY ADVERTISING pursuant to New York RPC 7.1 Copyright © 2025 Marshall Dennehey, all rights reserved. No part of this publication may be reprinted without the express written permission of our firm. For reprints or inquiries, or if you wish to be removed from this mailing list, contact tamontemuro@mdwcg.com.

Firm Highlights

Thought Leadership

U.S. Supreme Court Decides Key Issue Regarding Interstate Freight Broker Liability

Freight brokers are intermediaries.  They connect shippers of goods with trucking companies that transport those goods.  Freight brokers match a load of freight with a trucking company and oversee the logistics of the transportation. For a number of years there has been a division among the Federal Circuits regarding the potential liability of freight brokers when the trucking companies that they retain for interstate loads are involved in accidents.  At the center of this division was the Federal Aviation Administration Authorization Act of 1994 (FAAAA).  Some Federal Circuit Courts have held that state law negligent hiring claims against freight brokers were preempted by the FAAAA .  Other Federal Circuits Courts have held that even if preemption applied, the “safety exception” in the FAAAA saved state law negligent hiring claims from federal preemption.  On May 14, 2026, the U.S. Supreme Court addressed the conflict in Montgomery v. Caribe Transport II, LLC, et al, No24-1238. In that case freight broker C.H. Robinson selected Caribe Transport to haul an interstate load. The commercial truck driver employed by Caribe Transport allegedly caused an accident and the plaintiff, Montgomery, was seriously injured. Montgomery brought an action against the driver, Caribe Transport and C.H. Robinson. The allegation against C.H. Robinson was that it negligently retained Caribe Transport when it knew, or should have known, that it was an unsafe company. The Seventh Circuit Court of Appeals held that Montgomery’s claims against C.H. Robinson were preempted by the FAAAA. The plaintiff appealed to the U.S. Supreme Court.  The U.S. Supreme Court’s decision focused primarily on the safety exception in the FAAAA.  That provision provides that the FAAAA preemption “…shall not restrict the safety regulatory authority of a State with respect to motor vehicles.” C.H. Robinson argued, as freight brokers historically have, that their function was not “with respect to motor vehicles” because they do not own trucks or employ drivers. They are merely intermediaries, connecting entities who need freight moved with entities who can do that job. Therefore, C.H. Robinson argued that preemption applied, not the safety exception. The U.S. Supreme Court did not accept that argument. The Court focused on the meaning of the phrase “with respect to” in the safety exception. The Court held that it means “referring to”, “concerning” or “regarding”. Therefore, writing for a unanimous Court, Justice Barrett concluded that “[r]equiring C.H. Robinson to exercise ordinary care in selecting a carrier therefore “concerns” motor vehicles—most obviously, the trucks that will transport the goods. So, Montgomery’s negligent-hiring claim falls within the FAAAA’s safety exception, which saves it from preemption.” Justice Kavanaugh, in his concurring opinion, noted the effect this ruling may have on freight brokers and their insurers throughout the country: Importantly, the Court's decision today should not be read to mean that brokers will routinely be subject to state tort liability in the wake of truck accidents. As even plaintiff's counsel stressed, brokers should be able to successfully defend against state tort suits if the brokers have acted reasonably and arranged transportation with reputable trucking companies. Tr. of Oral Arg. 27-29. In plaintiff's counsel's words, the brokers "just have to hire carriers that actually have a reasonable policy," and "the broker is not going to have a problem if it's asking the hard questions of the carrier." Id., at 42, 45. In addition, the proximate-cause requirement in typical state tort law should help protect brokers from excessive liability. Id., at 25. That said, the brokers rightly caution against naivete. In the real world, as the brokers forcefully respond, state tort law can be unpredictable, and the costs to brokers of litigation and insurance may be significant even when brokers prevail in lawsuits. Moreover, the costs of litigation and insurance, as well as the costs of brokers' conducting more substantial inquiries into trucking companies, will cascade through the economy and be paid in part by American consumers in the form of higher prices. The concerns expressed by the brokers are legitimate and weighty. The key point here is that freight brokers can no longer claim they are protected from negligent retention claims by the FAAAA (in cases involving interstate transportation). The challenge will be to determine what is considered ”reasonable efforts” used by brokers when retaining transportation companies. 

Result

No-Cause Jury Verdict Secured in Wrongful Death Trial

We successfully obtained a no-cause jury verdict in a 13-day wrongful death trial. The decedent, a 59-year-old man, was admitted to the emergency room on February 15, 2019, with complaints of abdominal pain, decreased appetite, and constipation, despite the use of laxatives. The patient did not complain of any nausea, vomiting, or diarrhea. He had a significant medical history including diabetes, hypertension, prior coronary artery stenting, morbid obesity (with past gastric bypass surgery), longstanding ventral hernia, and back pain. A CT scan revealed multiple hernias and a potential closed-loop bowel obstruction, leading to a surgery consultation. Our client, an emergency general surgeon, interpreted that the patient did not have a closed loop or any significant obstruction and recommended non-surgical management. The patient was approved to have clear liquids, and had a vomiting incident shortly after, but our client was not notified. The patient was returned to NPO status, and after improving overnight, he was returned to “clears” and additional medical and renal consults were ordered. Our client did not receive any communications from the residents/nurses of any changes in the patient’s condition. On February 18, 2019, two rapid responses were called due to increased heart rate and vomiting. It is believed that the vomiting resulted in aspiration, causing sepsis, ultimately leading to the patient’s death. During the trial, the plaintiff’s sole medical expert highlighted imaging on the wrong hernia, which called into question all of his opinions in the case. We made key objections related to the expert testimony, limiting what the allegations were, and preventing new allegations from being made. After approximately two and a half hours of deliberating, the jury returned a no-cause verdict. 

News

Christina Gonzales To Speak at the Women of Color Roundtable at DRI’s Diversity and Inclusion Seminar

Event

29th Annual FDLA Florida Liability Claims Conference

Jim and Erica will team up to present, "Supporting the Next Generation: Connecting with Associates." This panel-style presentation will explore communication best practices from the perspective of a senior shareholder and newer associate. The discussion will focus on the communication styles of different generations and effective strategies to avoid communication breakdowns. Topics to be discussed include the hiring process, perceptions of defense work among newer lawyers, work-life balance issues after hiring, and mentoring.

graphic with Maria Granaudo photo text announces she has joined the firm as a shareholder in the Health Care Dept.

News

Maria R. Granaudo Joins Marshall Dennehey’s Wilmington Office As a Shareholder in the Health Care Department

Result

Summary Judgment Secured, Preserving $750,000 in Coverage for Insured in Major Trucking Liability Dispute

Ray Freudiger and Michael A. Roberts (both of Cincinnati) successfully obtained summary judgment on behalf of their client in a coverage dispute arising from a May 19, 2022, motor vehicle accident. A permissive driver operated a box truck for an interstate trucking company and caused severe injuries to two tort victims. Prior to the accident, the insured had procured a commercial auto policy for the trucking company with stated limits of $1,000,000. Following the accident, the insurer initiated a declaratory judgment action asserting that only reduced bodily injury limits of $25,000/$50,000 applied and later counterclaimed, alleging it would not have insured the driver had he been properly submitted for approval under the policy. After extensive discovery, briefing, and oral argument, the court rejected the insurer’s attempt to shift responsibility for the $750,000 in coverage it was legally required to provide for permissive drivers under Ohio law, granting summary judgment in favor of the insured and preserving $750,000 in liability exposure.

News

Marshall Dennehey Again Earns Recognition in Distinguished Chambers USA

blue facade of a hospital sign against blue sky

Result

Defense Verdict in Complex Medical Malpractice Trial

Thought Leadership

PA Middle District Dismisses Claims Against School District and its Superintendent, Principal, Special Education Director, and Classroom Teacher

A five-year-old special education student was enrolled in the Wyoming Valley West School District and attended the State Street Elementary School during the 2024-2025 school year. The student refused to clean up classroom toys at dismissal. When his teacher allegedly grabbed him by the wrist to walk him back to his seat, the student dropped to the floor and began crying. The teacher then allegedly grabbed the student by the ankle and dragged him across the floor. Following an investigation, criminal charges were not advanced by the county DA, and the school permitted the teacher to return to the classroom. The student’s parents sued, lodging thirteen legal counts under both state and federal law, which sought monetary damages from the teacher, the school district, the superintendent, the principal, and the director of special education. The plaintiff’s 42 USC 1983 claims were dismissed as to the school district for failure to allege a policy or custom violation, and the failure to alleged deliberate indifference in the failure-to-train context. As to the superintendent, building principal, and special education director, the Section 1983 claims were also dismissed for failure to allege personal involvement on the part of the individuals. Regarding an equal protection claim asserted against all defendants, the motion to dismiss was also granted for a failure to advance a plausible equal protection claim, holding that “plaintiffs' single-act allegations do not include a factual basis to even infer that the act was motivated by discriminatory animus rather than some other non-discriminatory impulse.” The court further dismissed the plaintiff’s negligence-based claims including negligence against the teacher and district administrators, NIED, and vicarious liability under the Political Subdivision Tort Claims Act (PSTCA). The federal claims under the IDEA, Section 504, and the ADA were also dismissed in various respects. The IDEA claim was dismissed against all defendants with prejudice for failure to exhaust administrative remedies. The Section 504 claims against the individual defendants were also dismissed with prejudice, as districts, not individuals, are the recipients of federal funds under Section 504. However, the Section 504 and ADA claims were dismissed without prejudice as to defendant Wyoming Valley West, and the plaintiff was permitted leave to amend.

Thought Leadership

Marijuana Legalization and Workplace Risk: What New Jersey Employers Need to Know

While the legalization of recreational marijuana usage poses a risk of increased work-related accidents for younger workers, employers can work to curb this increase by investing in education, effective drug policies, and employee assistance programs.