Wednesday, February 3, 2016

U.S. District Court holds worker's comp carrier cannot intervene in third-party claim

Brian Goodrich brought a products liability case alleging that he was injured while using a machine in the course of his employment.  His worker's comp insurer, NorGuard, moved to intervene in the case, asserting that it has a subrogation interest in any potential damages recovered by Goodrich.

In Goodrich v. Cequent Performance Prods., Inc., 311 F.R.D. 22 (D. Mass. 2015), the United States District Court for the District of Massachusetts denied the motion to intervene. 

Fed. R. Civ. P. 24(a) allows a party to intervene if the party claims an interest relating to the property or transaction at issue.  However the rule has an exception if "existing parties adequately represent that interest." 

Mass. Gen. Laws ch. 152, §15 provides that sums recovered in a third-party claim where the worker's comp carrier has paid a claim for that same injury are for the benefit of the insurer up to the sum it paid.  The insurer has an opportunity to be heard on a motion for approval of any settlement of the claim. 

The statute also bars the insurer from bringing suit against a third party if the injured employee has already filed suit against that party. 

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