North Carolina: Insurer’s Anti-Fraud Actions May Backfire into Punitive Damages

An injured worker, who sustained catastrophic injuries that initially rendered him comatose and which ultimately resulted in significant behavioral and memory deficits, including deficits in executive functioning, problem solving, planning, and balance, may proceed in tort against his employer’s workers’ compensation carrier, based upon his allegations that the carrier, with the aid of an extensively edited videotape, convinced a local police department to bring criminal charges against the worker under the theory that the worker had obtained workers’ compensation benefits by false pretenses. Based on the edited video, the worker—who had been receiving workers’ compensation benefits for his injuries—was arrested, jailed, and subsequently indicted on 25 counts of obtaining property by false pretenses and one count of insurance fraud. A state psychologist determined that the worker was mentally incapable of both proceeding to trial and effectively assisting counsel. The insurer now faces potential punitive damages.

Thomas A. Robinson, J.D., the Feature National Columnist for the LexisNexis Workers’ Compensation eNewsletter, is co-author of Larson’s Workers’ Compensation Law (LexisNexis).

LexisNexis Online Subscribers: Citations below link to Lexis Advance.

See Seguro-Suaraez v. Key Risk Inc. Co., 2018 N.C. App. LEXIS 888 (Sept. 4, 2018)

See generally Larson’s Workers’ Compensation Law, § 100.01.

Source: Larson’s Workers’ Compensation Law, the nation’s leading authority on workers’ compensation law

For a more detailed discussion of the case, see