The Chilling Effect of Collateral Estoppel: An Investigative Look Back at the Workers' Compensation File May Put the Plaintiff's Toxic Tort Action on Ice

The Chilling Effect of Collateral Estoppel: An Investigative Look Back at the Workers' Compensation File May Put the Plaintiff's Toxic Tort Action on Ice

In a pending toxic tort action, it is not surprising to learn that the plaintiff in the civil action also pursued a workers’ compensation claim against his or her employer for the same injuries and condition. The workers’ compensation file can have a treasure trove of helpful documents, information and medical information. Defense counsel unfortunately often fail to obtain, let alone investigate, this information to assist in the tort action. Recently, the Ohio Court of Appeals placed another arrow in defense counsel’s quiver in effectively precluding a plaintiff from proceeding in a civil toxic tort action.

In Mitchell vs. International Flavors and Fragrances, Inc. et al., 2008 WL 2853880 (Ohio App. 1 Dist.) (July 25, 2008), the court determined a workers' compensation finding regarding the causal link between a popcorn flavoring and a plaintiff’s injury was binding in subsequent litigation of a parallel suit. In that case, the plaintiff, Mitchell, filed a workers' compensation action in April 2004 against her employer, Gold Medal Products, contending her lung disease was related to her exposure to the chemical “diacetyl” during her work as an assembler. Diacetyl is a chemical used in some popcorn butter flavoring. She filed a parallel suit against the chemical’s manufacturers in June 2004.

The Industrial Commission found that Mitchell’s lung problems were not causally related to the chemical diacetyl nor were they related to her employment. She then appealed the decision to a district hearing officer who ruled she had not met her burden of proof linking her breathing problems to the chemical, nor had she demonstrated her disease was work related. As a result, the plaintiff appealed that decision to a staff hearing officer where she presented additional evidence regarding her condition and exposure. The staff hearing officer determined – with “additional reasoning” – that her condition was not linked to diacetyl exposure. Nonetheless, she appealed that finding to the Ohio Common Pleas Court, but voluntarily dismissed the action in 2006. Her motion to dismiss, however, reserved the right to refile within one year. Despite this reservation, Mitchell failed to refile within that time.

After the year had passed, the chemical manufacturers in the civil suit asserted that the workers' compensation ruling that her illness was not work related or caused by the chemical was binding; and “collaterally estopped” Mitchell because she had “fully and fairly” litigated the issue in the workers' compensation action. Mitchell contended that the issue was not “fully and fairly” litigated because the manufacturers had withheld information which would have linked her disease to the chemical. The trial court granted defendants’ motions for summary judgment, finding that Mitchell could not prevail in the tort case as a matter of law based upon the Industrial Commission’s earlier finding.

The Ohio Court of Appeals carefully analyzed the doctrine of collateral estoppel. “Issue preclusion, or collateral estoppel, provides that an issue or fact that was fairly, fully, and necessarily litigated and determined in a prior action may not be drawn into question in a subsequent action between the same parties or their privies, regardless of whether the claims in the two actions are identical or different.” Id. at p. 3. Moreover, the court stated that “collateral estoppel applies when (1) the party against whom estoppel is sought was a party or in privity with a party to the prior action; (2) there was a final judgment on the merits in the previous action after a full and fair opportunity to litigate the issue; (3) the issue was admitted or actually tried and decided and was necessary to the final judgment; and (4) the issue was identical to the issue involved in the new action.” Id. at p. 3.

Mitchell argued on appeal that she was not able to fully and fairly litigate her claim, because the manufacturers failed to produce necessary medical causation information; thus, resulting in a “manifest injustice”. She further argued that the trial court improperly applied collateral estoppel, since the parties and issues in the instant action and the workers’ compensation action were not identical. Finally, Mitchell argued that the trial court failed to allow her additional time to conduct discovery prior to the court’s ruling on the summary judgment motions.

The Ohio Appellate Court categorically rejected each of Mitchell’s assertions. The court found that the record adequately contained plenty of popcorn-worker lung medical causation information, studies and reports. In fact, there were case specific medical reports from Mitchell’s own treating physicians linking her alleged lung problems to her workplace exposure. In spite of the favorable medical reports and studies to Mitchell’s case, there were just as many, if not more, medical reports and opinions to the contrary showing that her lung condition was more consistent with an interstitial pneumonitis, a condition unrelated to popcorn workers' lung disease. The Appellate Court concluded that Mitchell therefore had plenty of time and a full and fair opportunity to litigate her claim in the workers’ compensation action.

With respect to Mitchell’s argument that the parties in the two actions were not identical under the collateral estoppel doctrine, the court found that the strict rule of “mutuality of parties” is generally relaxed for the analysis. The defendants needed only to show “that the party against whom the doctrine is asserted previously had his day in court and was permitted to fully litigate the specific issue sought to be raised in the latter action.” Id. at p. 6. Since collateral estoppel pertains to “issue preclusion” and not “claim preclusion,” Mitchell simply failed to establish that she was occupationally injured by the popcorn butter flavorings. Finally, the court noted that the tort action had been pending for over three years before any defendant’s first motion for summary judgment was filed. Mitchell therefore had plenty of time to conduct discovery in the case. When Mitchell further failed to prevent the workers’ compensation decision from being made final, she in effect lost her right to pursue the tort action.

© Copyright 2009 DRI. All rights reserved. This blog, written by Craig T. Liljestrand, Hinshaw & Culbertson, LLP, Chicago, IL, originally appeared on the For the Defense Blog. Reprinted with permission.