Nebraska Supreme Court Ruling on COVID-19 Workers' Compensation Claim

In the recent decision, Thiele v. Select Medical Corp., the Nebraska Supreme Court overturned the denial of a woman's workers' compensation claim for a COVID-19 infection.

Christine Thiele contracted COVID-19 in April 2020 while working as a nurse liaison at a critical care recovery hospital in Omaha. Thiele filed a Petition in the Nebraska Workers' Compensation Court alleging that COVID-19 is an occupational disease caused by her work and that she is entitled to benefits as a result of her exposure.

"Occupational disease" is defined in Section 48-151(3) as "disease which is due to causes and conditions which are characteristic of and peculiar to a particular trade, occupation, process, or employment, and excludes all ordinary diseases of life to which the general public is exposed."

Initially, the Nebraska Workers Compensation Board denied her claim, ruling that COVID-19 was not to be considered an occupational disease. However, Thiel appealed, and the Nebraska Supreme Court reversed the dismissal of her case, finding that COVID-19 was still rare enough to be considered a particular risk for healthcare workers at the time of symptoms' contraction.

The Court's decision was split 4-3, with three justices endorsing one opinion considered the lead opinion; the result was that the trial judge should not have dismissed Thiel's claim and allowed the case to proceed to trial. Three justices dissented with the reasoning and result of the lead opinion. Ultimately, this decision does not resolve the ongoing debate about whether COVID-19 can be considered an occupational disease under the Nebraska Workers' Compensation Act.

The lead opinion introduced a new legal principle. It argued that when determining whether an illness is an 'ordinary disease of life,' the focus should be on the period of exposure prior to contraction or onset of symptoms, rather than the circumstances at the time of the hearing. In Thiel's case, this meant that the trial judge should have considered when she contracted the virus in 2020, a time when healthcare workers faced a heightened risk of exposure, rather than when the Petition was filed in 2022.

On the other hand, the three justices who dissented emphasized that COVID-19 has always spread in the same way; any person-to-person interaction carries the risk of contracting COVID-19 and found that COVID-19 cannot be considered anything other than an ordinary disease of life, regardless of the time period.

Thiel's case, while not providing binding authority or clarity on whether COVID-19 should be considered an occupational disease, does offer a starting point for future cases. The Court's opinion suggests that when determining if an illness, specifically COVID-19, is an ordinary disease of life, one must focus on the period of exposure. This interpretation could potentially influence future workers' compensation claims related to COVID-19.

Legally Entitled to Recover? The case of Geerdes v. West Bend Mutual Insurance Company

The case Geerdes v. West Bend Mutual Insurance Company was decided by the United States Court of Appeals for the Eighth Circuit on June 20, 2023. The decision helps interpret the phrase "legally entitled to recover" under Iowa insurance law. In 2018, Iowa residents Gregg Geerdes and Mary Murphy (“Plaintiffs”) purchased home and automobile insurance from West Bend. The policy covered Plaintiffs as well as their son. The following year, Plaintiff’s son tragically died from injuries he sustained while a passenger on a charter bus that crashed in British Columbia, Canada. The charter bus’s insurance paid all the no-fault motorist insurance benefits that it was legally obligated to pay under the policy. Plaintiffs did not sue the bus company as personal jurisdiction for any such action would be in British Columbia. Plaintiffs did however sue West Bend seeking uninsured/underinsured benefits and additional umbrella coverage they believed they were entitled to under their policy. The West Bend Policy states policyholders are entitled to uninsured/underinsured coverage for payment of compensatory damages for bodily injury caused by an accident that an insured is “legally entitled to recover from the owner or operator.” However, Iowa case law states the benefits plaintiffs are entitled to recover from uninsured/underinsured umbrella policies are limited to the amount they would be able to recover in a tort action against the tortfeasor where the accident occurred or in the tortfeasors’ home state. Applying this law, the District Court dismissed the case via summary judgment because Plaintiffs are not “legally entitled to recover” under British Columbia law as it does not permit recovery of non-economic damages.

On appeal, Plaintiffs contended that Iowa law requires the court to interpret the phrase “legally entitled to recover” liberally, not literally. Plaintiffs introduced cases where Iowa courts have found plaintiffs were “legally entitled to recover” damages from the tortfeasor even when they may not have been able to in the tortfeasor’s home state or in the state the injury occurred. The Eighth Circuit explained that these circumstances occurred when plaintiffs were being precluded from recovery based on procedural law, not substantive law.

British Columbia’s substantive law does not permit recovery for non-economic damages. Thus, the Eighth Circuit Court affirmed the District Court's judgment, concluding that Plaintiffs were not “legally entitled to recover” and therefore the policy did not award coverage.

The Eighth Circuit’s opinion should catch the eye of Iowa insurers when it comes to how “legally entitled to recover” is interpreted and applied.

Erickson|Sederstrom Law Clerk Emily Todd assisted with drafting this article and her help is greatly appreciated.