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Workers' Compensation Board

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Case # G0690662
Date of Accident: 12/03/2012
District Office: NYC
Employer: Interior Alterations Inc.
Carrier: Continental Indemnity Company
Carrier ID No.: W063507
Carrier Case No.: 61680
Date of Filing of Decision: 06/16/2017
Claimant's Attorney: Jonathan H Poznansky
Panel: Kenneth J. Munnelly

MANDATORY FULL BOARD REVIEW
FULL BOARD MEMORANDUM OF DECISION

The Full Board, at its meeting on May 16, 2017, considered the above captioned case for Mandatory Full Board Review of the Board Panel Memorandum of Decision filed October 27, 2016.

ISSUE

The issue presented for Mandatory Full Board Review is whether the claimant violated Workers' Compensation Law (WCL) § 114-a.

The Workers' Compensation Law Judge (WCLJ) found the claimant did not violate WCL § 114-a.

The Board Panel majority reversed the WCLJ decision, finding the claimant violated WCL § 114-a, imposed a mandatory penalty disqualifying claimant from receiving awards from May 16, 2015, until January 8, 2016, and imposed the discretionary penalty disqualifying the claimant from future indemnity benefits.

The dissenting Board Panel member would find that claimant did not violate WCL § 114-a.

The claimant filed an application for Mandatory Full Board Review on November 23, 2016, arguing that his unsuccessful "attempt to reenter the workforce" should not result in a WCL § 114-a violation, and requests that an impartial specialist examine him to make permanency findings.

The carrier filed a rebuttal on December 23, 2016, contending that whether the claimant earned a profit or any income from his business is irrelevant because the claimant violated WCL § 114-a by providing untruthful and evasive testimony.

Upon review, the Full Board votes to adopt the following findings and conclusions.

FACTS

This case is established for a work-related injury to the claimant's left ankle that occurred on December 3, 2012, when beams fell on the claimant. By Notice of Decision dated March 5, 2014, the case was amended to include consequential depression, the WCLJ made awards at the total disability rate of $466.33, and ordered the carrier to continue the payments at that rate. By Notice of Decision dated April 10, 2014, the WCLJ directed the carrier to continue payments at the temporary total disability rate of $466.33.

In an IME-4 (Independent Medical Examiner's Report of Independent Medical Examination) dated March 6, 2015, for an independent medical examination (IME) held on that same day, the carrier's medical consultant, Dr. Rubinshteyn, indicated the claimant reported he was not working. The claimant also reported he could walk for one-half of a city block without pain, could sit for twenty minutes, but reaching, bending, walking and sleeping exacerbated his pain.

The carrier appealed the WCLJ decision dated April 10, 2014, and by Memorandum of Decision dated April 22, 2015, the Board Panel modified the claimant's benefit rate to a tentative rate of $233.17, pending the depositions of the claimant's treating physicians and the carrier's medical consultants.

In a PS-4 (Attending Psychologist's Report) dated June 21, 2015, for treatment between May 6 and June 16, 2015, claimant's treating psychologist, Dr. Puro, noted that claimant was severely depressed, anxious and agitated.

In a report based on a June 17, 2015, examination, claimant's treating physician, Dr. Babus, reported the claimant had been unable to work since the date of the injury. The claimant also reported difficulty performing household chores, shopping, socializing with friends, participating in recreational activities and exercising. Dr. Babus noted the claimant underwent surgery for a spinal cord stimulator, and he felt some relief from the pain as a result. Dr. Babus concluded the claimant remained totally disabled and unable to work.

In C-4.2 dated June 29, 2015, Dr. Reilly reported the claimant remained unable to work and totally disabled. Dr. Reilly noted the claimant "is struggling greatly with the left foot with the RSD. Pain is still a major issue, as is some depression right now."

In an IME-4 dated September 30, 2015, for an examination held on September 28, 2015, the carrier's psychiatric consultant, Dr. Head, noted the claimant denied any work history since his last IME on November 4, 2013, or since his injury on December 3, 2012, although the claimant reported the successful completion of a veterinary assistant online course. Dr. Head noted the claimant specifically denied returning to work, or undergoing vocational rehabilitation or guidance. Dr. Head reported the claimant stated he had not attempted to solicit new work or find a new position because of the persistence of pain in his left lower extremity. Dr. Head reported the claimant indicated he did not socialize with anyone during the day, he did not take walks, and that he spent most of his time at home watching television. Dr. Head found the claimant had reached maximum medical improvement, there was no permanent psychiatric condition causally related to the claimant's work injury, and opined the claimant did not require any additional psychological or psychiatric care.

At a subsequent hearing held on October 26, 2015, the carrier raised the issue of WCL § 114-a, and asserted there was evidence the claimant was working. The carrier requested that the claimant's benefits be suspended pending further development of the record, and maintained the evidence included screen shots of bank account transactions showing the claimant was earning money while collecting workers' compensation benefits. The WCLJ suspended the claimant's benefits without prejudice, and scheduled the next hearing for the testimony of the claimant and the carrier's investigator.

At a hearing on January 8, 2016, the claimant testified that he had not worked anywhere since his accident occurred on December 3, 2012, but he attempted to help feed homeless people and lost all of his money. The claimant testified that his nieces created an Instagram account called "Uncle Bob's Kitchen" and the claimant taught his nieces how to cook, but he did no other work. He went to culinary school in 2005-2006, and received a certificate. He did not incorporate a business or take any legal action to create a business.

On cross-examination, the claimant initially testified that "Rob 2523" was not his Instagram account, but he subsequently confirmed that the account belonged to him. The claimant testified that on May 16, 2015, he posted, "Hey everyone, I make dog food. If your dog needs to lose weight or has problems with health, contact me." The claimant explained that he made dog food for his dogs, and he did not make dog food for anybody.

The claimant testified he posted on May 18, 2015, "Jarring my sauces today. Anybody wants some? I'll show you picks when I jar it" and "meatballs and sausage and spare ribs, $7.00." When asked whether he intended to expand the process of making food at home, the claimant replied, "no because I am a person on Workers' Compensation. I can't make money."

The claimant admitted he also posted, "Making alfredo and vodka sauces from scratch. Place orders now" and "I need to rent a commercial kitchen. Any ideas?" The claimant denied purchasing shirts for his business and testified he bought shirts for his nieces and nephews. The claimant testified that on April 14, 2015, he posted, "Please visit my channel. Merchandise coming soon," but testified that he had no merchandise. The claimant admitted he wrote, "my brother from another mother, first purchase of weekly diet food" but explained that his friend lent him money to make the food, but the claimant was not able to make the food, and returned the money.

The claimant also testified he was attempting to make himself appear more successful than he really was. The claimant testified he never intended to sell lunches or operate a business. The claimant admitted that on May 21, 2015, he posted, "ten percent of proceedings go to American Cancer Society" but he never made any money for the charity. The claimant also testified he posted all the information for his niece, who prepared food for soup kitchens. When asked about a post that stated, "pies made for customers," the claimant testified the customers were his friends and family, and he gave them pies prior to Thanksgiving, although the carrier's attorney noted the date of the post was May 19, 2015.

The claimant also testified he once volunteered walking dogs with his girlfriend, and he volunteered for four days over a six month period at a veterinary hospital.

At the conclusion of the testimony, the WCLJ requested all of the documentation as the hearing was remote, and stated, "[f]rankly I am not too impressed with [the claimant's] testimony today. His explanations do not have the ring of truth to them at all." The WCLJ requested the transcripts from prior hearings in order to make a finding concerning whether the claimant violated WCL § 114-a. The social media evidence was submitted to the claimant's case file as document #260737714

At the hearing on February 4, 2016, the WCLJ ruled the claimant did not violate WCL § 114-a, finding that although the claimant attempted to start a cooking business, and he received one payment, he did not understand that constituted work. The WCLJ also rescinded the finding that the claimant was totally disabled during that time period, because the claimant was standing, lifting, chopping and cooking. The WCLJ made awards from December 5, 2014, to January 1, 2015, at $466.34 and from January 1, 2015, to the date of the hearing at the partial disability rate of $233.17. The WCLJ continued the case for the parties to produce permanency reports. These findings were memorialized in a Notice of Decision dated February 9, 2016.

The carrier filed an application for administrative review arguing that the claimant made material misrepresentations of fact and should be permanently disqualified from receiving future indemnity benefits.

In rebuttal, the claimant argued the carrier failed to object to the WCLJ's finding of no WCL § 114-a violation at the hearing, and as such, the application for review should be denied.

LEGAL ANALYSIS

WCL § 114-a(1) Violation

The Board's 2012 Impairment Guidelines (2012 Guidelines) set forth objective standards for evaluating and rating medical impairment. The extent of impairment will be measured by considering medical evidence of impairment and medical evidence of functional loss.

"Workers' Compensation Law § 114-a authorizes the Board to disqualify a claimant from receiving future wage replacement benefits if it finds that the claimant knowingly made a false statement or misrepresented a material fact in order to obtain workers' compensation benefits or to influence any determination regarding such benefits (see Matter of Phelps v Phelps, 277 A.D.2d 736 [2000])" (Matter of Johnson v New York State Dept. of Transp., 305 AD2d 927 [2003]).

Here, the claimant did not disclose his activities to his treating physicians or the carrier's medical consultants, but reported that he was not working and that he was experiencing severe pain, depression, withdrawal, difficulty performing household chores, shopping, socializing with friends and participating in recreational activities and exercising, and that he spent most of his time at home watching television. The claimant never reported to any physician that he was attempting to cook meals to sell to other people.

Therefore, the Full Board finds that claimant's activities as shown on social media beginning on May 16, 2015, were inconsistent with his self-reporting to the physicians, and as such, the claimant violated WCL § 114-a.

WCL § 114-a(1) Penalties

"Workers' Compensation Law § 114-a(1) provides that a claimant will be disqualified from receiving compensation attributable to a false statement or representation of a material fact made for the purpose of obtaining wage replacement benefits. Any compensation already paid to a claimant which is directly attributable to a claimant's misrepresentations must be rescinded by the Board. The Board also has the discretionary authority to disqualify the claimant from receiving any future wage compensation benefits regardless of whether or not the claimant is subject to the mandatory penalty, even if the claimant has suffered a compensable injury. In addition, the Board may subject the claimant to an additional penalty up to the amount directly attributable to the false statement or representation" (Matter of Church v Arrow Elec., Inc., 69 AD3d 983 [2010] [internal quotation marks and citations omitted]). However, the discretionary "penalty imposed may not be disproportionate to the underlying misconduct (Matter of Harp v New York City Police Dept., 96 NY2d 892 [2001])" (Matter of Kodra v Mondelez Intl., Inc., 145 AD3d 1131 [2016]). In support of a determination that this onerous penalty is warranted, the Board must provide an explanation that the underlying deception was egregious or severe, or there was a lack of mitigating circumstances (Kodra, 145 AD3d 1131 [2016]).

Here, a mandatory penalty is not applicable because it is impossible to determine what, if any, benefits claimant received which are directly attributable to his material misstatements. However, the Full Board finds that a discretionary penalty is warranted which disqualifies claimant from receiving benefits for the period from May 16, 2015, the first day of his social media post, until January 8, 2016, the date of his testimony. That discretionary penalty is warranted because the claimant's testimony was wholly incredible. Despite testifying that he never intended to operate a business, the claimant admitted posting items such as, "meatballs and sausage and spare ribs, $7.00," "making alfredo and vodka sauces from scratch. Place orders now," "I need to rent a commercial kitchen" and "my brother from another mother, first purchase of weekly diet food." The claimant's attempts to explain his social media posts by testifying that he posted all the information for his niece were not believable.

Therefore, the Full Board finds that a discretionary penalty disqualifying claimant from receiving awards from May 16, 2015, to January 8, 2016, is hereby imposed based on claimant's violation of WCL § 114-a.

CONCLUSION

ACCORDINGLY, the WCLJ decision filed February 9, 2016, is MODIFIED to find that claimant violated WCL § 114-a, to find that a mandatory penalty pursuant to WCL § 114-a is not warranted, and to impose a discretionary penalty pursuant to WCL § 114-a which disqualifies claimant from receiving benefits for the period from May 16, 2015, to January 8, 2016. No further action is planned by the Board at this time.