HUTCHISON, JUSTICE
Submitted: March 12, 2024
Appeal from the Circuit Court of Cabell County The Honorable Paul T. Farrell, Judge Civil Action No. 19-C-127
R. Dean Hartley, Esq. Mark R. Staun, Esq. David B. Lunsford, Esq. Hartley Law Group, PLLC Wheeling, West Virginia Counsel for the Petitioners
Ancil G. Ramey, Esq. Steptoe &Johnson PLLC Huntington, West Virginia James J.A. Mulhall, Esq. Morgantown, West Virginia Dallas F. Kratzer III, Esq. Columbus, Ohio Counsel for Respondent Matrix Chemical LLC
Rodney L. Baker, II, Esq. Steptoe &Johnson PLLC Huntington, West Virginia
Counsel for Respondent The Early Construction Company
Niall A. Paul, Esq. Charity K. Lawrence, Esq. Spilman Thomas & Battle, PLLC Charleston, West Virginia Counsel for Respondent E.I. du Pont de Nemours and Company
Edward A. Smallwood, Esq. Leo G. Daly, Esq. Colby S. Bryson, Esq. Post & Schell, P.C. Pittsburgh, Pennsylvania Counsel for Respondents Nouryon Functional Chemicals, incorrectly named as "Akzo Nobel Functional Chemicals, LLC, a Delaware limited liability company"; Nouryon Chemicals LLC, as successor to Akzo Chemicals LLC, formerly known as Akzo Chemicals Inc., incorrectly named as "Akzo Nobel Chemicals, Inc., a Delaware corporation"; Bayer Corporation and Bayer CropScience, LP; and Monsanto Company
JUSTICE BUNN, deeming herself disqualified, did not participate in the Opinion of the Court.
JUDGE NINES, sitting by temporary assignment.
CHIEF JUSTICE ARMSTEAD dissents and reserves the right to file a separate opinion.
SYLLABUS BY THE COURT
1. "Collateral estoppel will bar a claim if four conditions are met: (1) The issue previously decided is identical to the one presented in the action in question; (2) there is a final adjudication on the merits of the prior action; (3) the party against whom the doctrine is invoked was a party or in privity with a party to a prior action; and (4) the party against whom the doctrine is raised had a full and fair opportunity to litigate the issue in the prior action." Syl. pt. 1, State v. Miller, 194 W.Va. 3, 459 S.E.2d 114 (1995).
2. "Relitigation of an issue is not precluded when a new determination of the issue is warranted by differences in the quality or extensiveness of the procedures followed in two courts. Where the procedures available in the first court may have been tailored to the prompt, inexpensive determination of small claims, a compelling reason exists not to apply collateral estoppel." Syl. pt. 2, State v. Miller, 194 W.Va. 3, 459 S.E.2d 114 (1995).
3. "For purposes of issue preclusion, issues and procedures are not identical or similar if the second action involves application of a different legal standard or substantially different procedural rules, even though the factual settings of both suits may be the same." Syl. pt. 3, State v. Miller, 194 W.Va. 3, 459 S.E.2d 114 (1995).
OPINION
HUTCHISON, JUSTICE
In this appeal from the Circuit Court of Cabell County, we consider the doctrine of collateral estoppel. Specifically, we consider whether collateral estoppel (sometimes called "issue preclusion") applies such that a finding in a West Virginia workers' compensation decision may be used to preclude litigation of that issue against a third party in a West Virginia circuit court.
In this case, a plaintiff alleges that he was injured when he was exposed at his employer's worksite to defective, toxic chemicals manufactured by third parties. The plaintiff filed a product-defect lawsuit against the third-party manufacturers, as well as a workers' compensation claim with his employer. The workers' compensation administrative process produced a decision finding that the plaintiff failed to prove he developed an injury in the course of and as a result of his employment. The third-party manufacturers subsequently filed a motion to dismiss the product-defect lawsuit, arguing that the plaintiff was collaterally estopped from litigating causation in the courtroom when that issue had been resolved by the workers' compensation administrative decision. The circuit court granted the motion to dismiss.
As set forth below, we reverse the circuit court's dismissal order. We find that the workers' compensation process involved legal standards and procedural rules that were substantially different from those in a courtroom, and that process did not afford the plaintiff a full and fair opportunity to litigate whether the third-party manufacturers' chemicals were a cause of his injury. Accordingly, we reverse the circuit court's order and remand the case for further proceedings.
I. Factual and Procedural Background
Between 1996 and 2018, plaintiff Michael D. Ruble worked at a chemical manufacturing plant near Lesage, West Virginia. The plaintiff worked in the making of polyurethane stains, paint strippers, xylene, acetone, and other paint-related products. In the course of his employment, the plaintiff asserts he worked with, and was exposed to the hazards from, various toxic raw materials supplied by the "Chemical Supplier Defendants."
The plant's owners varied over the years from Zinsser Co., Inc. and its subsidiary, New Parks, to its current owners, RPM International, Inc., and its subsidiary, Rust-Oleum Corporation.
Starting in 2016 or 2017, the plaintiff says he began having some breathing problems that he attributed to his chemical exposure at work. By late 2017, the plaintiff alleges he began showing symptoms of tremors, swollen hands and feet and numbness, weakness, memory problems, and difficulty walking. He stopped working on May 1, 2018.
On March 18, 2019, the plaintiff filed suit against his past and current employers ("the Employer Defendants") and against some of the Chemical Supplier Defendants. The plaintiff amended his complaint to add additional Chemical Supplier Defendants after receiving discovery from the Employer Defendants. In general, the plaintiff asserted that the Chemical Supplier Defendants had sent defective, toxic chemicals into the stream of interstate commerce and to the Lesage facility where he worked, and that these chemicals caused or contributed to his medical and physical problems.
The plaintiff alleged that his past and present employers had demonstrated a deliberate intention to cause him harm by repeatedly exposing him to unsafe working conditions, in violation of West Virginia Code § 23-4-2 (2015).
Contemporaneously, the plaintiff sought a workers' compensation remedy from his most recent employer, RPM International. The plaintiff filed a claim for occupational disease benefits, but the employer's claims administrator rejected the claim. The plaintiff appealed the claims administrator's decision to the West Virginia Workers' Compensation Office of Judges ("the OOJ"). The record contains the decision of an administrative law judge employed by the OOJ, but that decision suggests that no hearings were held before that judge or any other OOJ judge. Instead, the decision indicates the parties merely proffered evidence into the record. The plaintiff admitted a copy of his deposition testimony, various medical reports from doctors he has visited over the years, several articles from medical journals, and an expert report stating that an interview with the plaintiff demonstrated that the employer violated various safety regulations. The employer submitted written reports from medical examinations it requested, and an affidavit from a company employee describing safety equipment on the premises, such as ventilation fans, and protective equipment that was given to employees. After submitting evidence to the OOJ, both parties submitted written closing arguments.
See W.Va. Code § 23-4-1(f) (establishing guidelines for occupational disease awards).
Effective October 1, 2022, the Office of Judges was terminated, and all of its cases were transferred to the Workers' Compensation Board of Review. See W.Va. Code § 23-5-8b (2021).
In his decision dated October 15, 2020, an OOJ administrative law judge reviewed the submitted evidence and concluded that "[a] preponderance of the evidence indicates that the substances which are blended, filled and shipped at the employer's worksite can be toxic[.]" The judge also found that while the "employer makes efforts to ensure that its employees have reduced exposure to fumes and liquids from its products," "a preponderance of the evidence indicates there are gaps in this process." However, the judge found "the evidence regarding the [plaintiff's] direct exposure to fumes and/or liquids is inconsistent and inconclusive." Importantly, the decision does not deny the existence of the plaintiff's physical and medical problems; instead, the decision affirmed the denial of the plaintiff's claim because he did not prove, by a preponderance of the evidence, that he developed an occupational disease "in the course of and as a result of employment."
The plaintiff appealed this decision to the West Virginia Workers' Compensation Board of Review ("the Board"). In an order dated April 22, 2021, and in a generalized fashion, the Board "adopt[ed] the findings of fact and conclusions of law of the Administrative Law Judge's Decision dated October 15, 2020, which relate to the issue on appeal[.]" The Board then summarily affirmed the decision from the OOJ denying the plaintiff's claim for workers' compensation benefits. The plaintiff did not appeal the Board's decision to this Court.
Thereafter, the plaintiff and the Employer Defendants jointly agreed to voluntarily dismiss the Employer Defendants from the case. On December 9, 2021, the circuit court entered an order dismissing the claims filed by the plaintiffs against the Employer Defendants. However, the order also dismissed all of the cross-claims filed by the Chemical Supplier Defendants against the Employer Defendants.
Counsel for one of the Chemical Supplier Defendants, Matrix Chemical LLC, objected to the dismissal order. In response, counsel for the Employer Defendants explained that the basis for the dismissal order was the outcome of the workers' compensation proceeding. The Employer Defendants supplied the circuit court with copies of the OOJ decision and the order from the Board, both affirming the denial of the plaintiff's workers' compensation claim. Upon receipt of these documents, Matrix filed a motion to dismiss the plaintiff's complaint under West Virginia Rule of Civil Procedure 12(b)(6). Other Chemical Supplier Defendants promptly joined Matrix's motion.
The basis of Matrix's motion to dismiss was the doctrine of collateral estoppel. Matrix argued that the plaintiff litigated to conclusion before the OOJ the same issue he was attempting to litigate before the circuit court, namely whether he had been injured by exposure to chemicals in the workplace. Because the workers' compensation administrative process had resulted in a final ruling that the plaintiff had failed to establish an injury caused by workplace exposure, Matrix argued that the plaintiff could not collaterally challenge or relitigate that final ruling before the circuit court.
In an order dated April 4, 2022, the circuit court granted the motion to dismiss. The circuit court determined that collateral estoppel attached to the causation determination from the workers' compensation decision, in part because an individual in the workers' compensation administrative process may be represented by counsel and may request written discovery, take depositions, and proffer expert witnesses. The circuit court found, in part, that the plaintiff "had a full and fair opportunity to address the cause of his injuries[.]" Accordingly, the circuit court dismissed the plaintiff's claims as to all of the defendants remaining in the case.
The plaintiff now appeals the circuit court's April 4, 2022, dismissal order.
II. Standard of Review
"Appellate review of a circuit court's order granting a motion to dismiss a complaint is de novo." Syl. pt. 2, State ex rel. McGraw v. Scott Runyan Pontiac-Buick, Inc., 194 W.Va. 770, 461 S.E.2d 516 (1995).
III. Discussion
The central question raised by the plaintiff's appeal is whether collateral estoppel, also called issue preclusion, attaches to a finding made in a West Virginia workers' compensation administrative proceeding so that the issue may not be litigated, again, in a subsequent tort proceeding against a third party. In State v. Miller, 194 W.Va. 3, 9, 459 S.E.2d 114, 120 (1995), we discussed the doctrine of collateral estoppel. We identified four elements that must all be established for an issue decided in a prior action to have preclusive effect in a later action. We stated:
The plaintiff raises complicated arguments that the plaintiff has a right based on the West Virginia Constitution and the history of the workers' compensation system to have a jury hear his common law claims, and, therefore, that collateral estoppel cannot employ a workers' compensation ruling to prevent a jury from ruling on a claim. Because we decide this appeal in favor of the plaintiff on other grounds, we need not address these arguments.
Collateral estoppel will bar a claim if four conditions are met: (1) The issue previously decided is identical to the one presented in the action in question; (2) there is a final adjudication on the merits of the prior action; (3) the party against whom the doctrine is invoked was a party or in privity with a party to a prior action; and (4) the party against whom the doctrine is raised had a full and fair opportunity to litigate the issue in the prior action.Syl. pt. 1, State v. Miller, 194 W.Va. at 6, 459 S.E.2d at 117 (emphasis added).
In this appeal, we focus our attention on the fourth factor, and assess whether the plaintiff (against whom the collateral estoppel doctrine was raised in the circuit court) had a full and fair opportunity to litigate the issue of causation in the prior workers' compensation administrative proceedings. In Syllabus Point 2 of Miller, we found collateral estoppel does not apply, and relitigation of an issue in a subsequent proceeding is permitted, when there are "differences in the quality or extensiveness of the procedures followed in two courts. Where the procedures available in the first court may have been tailored to the prompt, inexpensive determination of small claims, a compelling reason exists not to apply collateral estoppel." We based this syllabus point on Section 28(3) of Restatement (Second) of the Law of Judgments (1982), which states in comment d that collateral estoppel should not apply where the simple procedures of the first forum are "wholly inappropriate to the determination of the same issues when presented in the context of a much larger claim." See Miller, 194 W.Va. at 10, 459 S.E.2d at 121. As the United States Supreme Court stated in B &B Hardware, Inc. v. Hargis Indus., Inc., 575 U.S. 138, 159 (2015), Issue preclusion may be inapt if 'the amount in controversy in the first action [was] so small in relation to the amount in controversy in the second that preclusion would be plainly unfair.' Restatement (Second) of Judgments § 28, Comment j, at 283-284. After all, "[f]ew . . . litigants would spend $50,000 to defend a $5,000 claim." [Charles] Wright &[Arthur] Miller[, 18 Fed. Prac. &Proc. Juris.] § 4423, at 612 [(2d ed. 2002)].
Moreover, in Syllabus Point 3 of Miller we further expounded on the fourth factor of the collateral estoppel test, finding that, "[f]or purposes of issue preclusion, issues and procedures are not identical or similar if the second action involves application of a different legal standard or substantially different procedural rules, even though the factual settings of both suits may be the same." Syl. pt. 3, Miller, 194 W.Va. at 6, 459 S.E.2d at 117. "Therefore, not only the facts but also the legal standards and procedures used to assess them must be similar." Id. at 10, 459 S.E.2d at 121. See also Charles A. Wright &Arthur R. Miller, 18 Fed. Prac. &Proc. Juris. § 4417 (3d ed. 2024) ("[i]ssues are not identical if the second action involves application of a different legal standard, even though the factual setting of both suits be the same.") (quoting Peterson v. Clark Leasing Corp., 451 F.2d 1291, 1292 (9th Cir. 1971)). Stated differently, collateral estoppel should not be applied
when the party against whom it is invoked can avail himself of procedures in the second action that were not available to him in the first action and that may have been significantly influential in determination of the issue. Differences in this regard include such procedures as discovery devices and plenary as distinct from summary hearing. It may also be relevant that the party against whom preclusion is invoked had no choice, or restricted choice, as to the forum in which the issue was litigated.Restatement (Second) of Judgments § 29 cmt. d (1982). An administrative decision may have preclusive effect, but "only if it resulted from a procedure that seems an adequate substitute for judicial procedure." 18B Fed. Prac. & Proc. Juris. § 4475.
The question, then, is whether the workers' compensation administrative procedures used in the plaintiff's claim were such that they may be an adequate substitute for juridical procedures in the circuit court. We find that they were not. The administrative procedures used in West Virginia workers' compensation proceedings made numerous accommodations to economy and celerity that are directly at odds with procedures in the circuit courts. West Virginia Code § 23-1-15 (2022) specifies that the workers' compensation process "is not bound by the usual common-law or statutory rules of evidence[.]" The legislative rules adopted by the Office of Judges to regulate the litigation of workers' compensation claims, 93 C.S.R. § 1 (2008) mirrored the above statute, stating that "[t]he Office of Judges shall not be bound by the usual common law or statutory rules of evidence, or by formal rules of procedure, except as provided by these rules." 93 C.S.R. § 7.2. These rules governed the plaintiff's workers' compensation claim.
As noted earlier, the Office of Judges was abolished by the Legislature and its duties assumed by the Board. Hence, in December 2022, the Board asked that these procedural rules be repealed.
The rules employed by the OOJ embodied informality. For instance, the rules generally specified that the only parties who could litigate were "the injured worker" and "the employer.” Hence, the rules excluded the collection or development of evidence or litigation of issues involving third parties, like the manufacturers of the products that might have injured the plaintiff. Closing arguments were not made orally (as they would be in a courtroom) and were not done in any particular order; instead, arguments were usually presented in writing at any time and could even be offered "in lieu of evidence.” Evidence was usually presented with little testing - by simply mailing affidavits, written reports, test results, or other documents to the main offices of the OOJ.
93 C.S.R. § 3.2.
93 C.S.R. §§ 3.5 and 6.5.
93 C.S.R. § 3.6.
93 C.S.R. § 7.3.
Under the rules, the parties were entitled to "discovery," but only in a very truncated format: each "party" was limited to thirty written interrogatories submitted to the other "party" (and each subpart of an interrogatory counted as a separate interrogatory).Employers could procure the employee's medical records, but the rules contain no reciprocal process permitting the employee to request documents or records from the employer's files. The OOJ rarely held hearings, and if so, the hearing would not necessarily be conducted by the administrative law judge who would later adjudicate the claim and sign the final decision. Instead, parties were "encouraged" to use depositions (paid for by the party requesting the deposition). Depositions were generally limited to crossexamining the opposing-party's medical witness and the employer cross-examining the employee. In this system, the administrative law judge could not make credibility judgments based on the witness's demeanor or temperament; instead, credibility determinations were made on a written transcript. Most expert opinions came in the form of written reports or a doctor's summary after an office visit. In this case, the OOJ decision appears, in part, to have been founded on documents prepared by the employer declaring that it used fans to eliminate fumes from the workplace. The OOJ's procedural rules allowed the admission of this evidence while simultaneously depriving the plaintiff of an opportunity to dispute the evidence.
93 C.S.R. § 7.2.B.2(b).
93 C.S.R. § 7.2.B.3.
93 C.S.R. § 13.1, 13.2.
93 C.S.R. § 7.2.B.4.
Even though there are factual similarities between the plaintiff's workers' compensation proceeding and his claims in the circuit court, the procedural rules for developing those claims in the circuit court involved vastly different legal standards and procedural rules from those before the OOJ. The record reflects that, when the plaintiff began both his lawsuit and his workers' compensation claims, he was unable to identify the toxic materials to which he was exposed at the worksite or the manufacturers of those materials. Before the lawsuit was filed, the employer refused to produce this information. The procedural rules in the workers' compensation system did not permit inspections of the plant, testing of the employer's ventilation system, or sampling of the air at employee workstations to assess where and how an employee might be exposed to toxic materials. Nor did the rules permit an employee to request that the employer produce documentary evidence of workplace conditions, or of prior inspections or citations by government regulatory agencies. Hence, the rules precluded the plaintiff from developing proof beyond his own statements and recollections as to the materials to which he was exposed.
Further, how damages are developed, proven, and awarded in a workers' compensation claim is substantially different from a civil claim, and that difference affects how evidence is developed. In a workers' compensation claim, in addition to medical benefits for the injury, the employee can usually only recover limited "damages" in the form of temporary total disability (that provides a small percentage of the employee's salary to pay bills while the employee is off work), and permanent partial disability (to compensate for any permanent physical impairments), both of which are calculated as a portion of the employee's weekly wage (but are capped by the average weekly wage of all workers in West Virginia). Attorney fees in workers' compensation claims are capped at 20% of the equivalent to 208 weeks of benefits. Thus, with the combination of limited benefits and limited fees, our workers' compensation statutory scheme disincentivizes a workers' compensation lawyer from spending monies on discovery and experts likely to consume or exceed the employee's recovery to prove a complicated third-party, toxic injury workers' compensation claim, and to suggest otherwise is illogical.
While medical benefits may be paid for so long as the employee continues to need care, the medical benefit may be terminated if the employee ceases to receive any "medical or any type of rehabilitation service . . . or durable medical goods or other supplies" for a period of five years. W.Va. Code § 23-4-16(a)(4) (2005).
Employees receive temporary total disability benefits equal to "sixty-six and two-thirds percent of the average weekly wage earnings, wherever earned, of the injured employee, at the date of injury, not to exceed one hundred percent of the average weekly wage in West Virginia." W.Va. Code § 23-4-6(b) (2005). Temporary benefits may be paid for a maximum of two years. Id. Employees also cannot receive temporary disability benefits for the first three days they are off for a work-related injury; only if the disability lasts longer than seven days can the employee collect the full benefit amount. W.Va. Code § 23-4-5 (2003).
Permanent partial disability awards are based upon the employee's percentage of whole-body physical impairment caused by the workplace injury. W.Va. Code 23-4-6(i). The award is usually calculated "on the basis of four weeks' compensation for each percent of disability determined at the maximum or minimum benefit rates as follows: Sixty-six and two-thirds percent of the average weekly wage earnings, wherever earned, of the injured employee at the date of injury, not to exceed seventy percent of the average weekly wage in West Virginia[.]" W.Va. Code § 23-4-6(e)(1).
"In no case may the fee received by the attorney of the claimant or dependent be in excess of 20 percent of the benefits to be paid during a period of 208 weeks." W.Va. Code § 23-5-16(a) (2022).
In summary, we find that the plaintiff (against whom the collateral estoppel doctrine was raised in the circuit court) did not have a full and fair opportunity to litigate the issue of the causation of his injuries in the prior, workers' compensation administrative proceedings. The administrative law judge did not find the plaintiff did not have an injury, but rather found he could not prove an injury in the course of and as a result of his employment. Employees injured in the course of their job are supposed to be able to pursue workers' compensation benefits quickly, recover enough to pay their medical bills, and gain wage replacement sufficient to keep bread on the table and the wolves away from the door. Upholding the circuit court's dismissal would deter employees from seeking workers' compensation until any third-party claims have been developed and resolved in a circuit court. This is directly contrary to the Legislature's command that employees injured on the job by a third party are allowed to pursue both a workers' compensation claim and a claim against the third party. See W.Va. 23-2a-1 (2022) ("Where a compensable injury or death is caused, in whole or in part, by the act or omission of a third party, the injured worker . . . shall not by having received [workers'] compensation be precluded from making claim against the third party."). Accordingly, as all four factors of the test in Syllabus Point 1 of Miller were not established, we find it was error for the circuit court to have applied collateral estoppel to the plaintiff's claims.
IV. Conclusion
Thus, the circuit court's April 4, 2022, dismissal order must be reversed, and the case remanded for further proceedings.
Reversed and Remanded.
ARMSTEAD, C.J., dissenting:
The majority reverses the circuit court's determination that Mr. Ruble is precluded from relitigating the workers' compensation decision that his exposure to chemicals at his workplace caused his medical condition. The majority's opinion will permit workers' compensation claimants who have adverse causation determinations in their workers' compensation cases to, nonetheless, proceed with filing civil actions in circuit court against third-party non-employers, essentially providing them a second "bite at the apple" to prove causation. Because I believe that the doctrine of collateral estoppel prohibits such relitigation of the issue of causation under the facts of this case, and the majority's opinion may have a far reaching effects on the law related to issue preclusion that may not be initially apparent, I respectfully dissent.
Mr. Ruble worked at the Rust-Oleum facility in Lesage, West Virginia from approximately 1996 to 2018. In 2019, Mr. Ruble filed an application for workers' compensation benefits alleging that the use and presence of chemicals at his workplace resulted in him suffering an occupational disease which caused sensory neuropathy and dermatitis. By order dated September 24, 2019, the claim administrator denied Mr. Ruble's application. Mr. Ruble appealed the decision of the claim administrator, which was affirmed by the Office of Judges ("OOJ"). He also appealed the decision of the Office of Judges, which was ultimately affirmed by the Board of Review ("Board"). While his worker's compensation case was still pending, he filed a civil action against his employer and almost two dozen third-party chemical companies. Mr. Ruble's civil action alleged the same workplace exposure, the same time frame of exposure and the same injuries as those in his workers' compensation case. After failing to prove that his medical condition was caused by exposure to chemicals at his workplace and receiving an adverse causation determination, Mr. Ruble decided to move forward with a civil action against the third-party chemical companies who allegedly produced the chemicals he maintains caused his illness. By order entered on April 4, 2022, the circuit court dismissed Petitioners' civil action with prejudice after concluding that their claims were barred by collateral estoppel.
I believe we must begin our analysis by examining whether the doctrine of collateral estoppel is properly applied to a workers' compensation decision. Mr. Ruble appears to characterize the application of collateral estoppel to workers' compensation determinations as a new and novel concept in West Virginia. However, in Steel of West Virginia, Inc. v. West Virginia Office of the Insurance Commissioner, No. 11-1607 (W.Va. Supreme Court, November 16, 2012)(memorandum decision), this Court clearly applied res judicata to findings contained in a prior workers' compensation decision. I view the majority's new conclusion that the procedures available in a workers' compensation proceeding are not an "adequate substitute" for judicial proceedings available to litigants in a circuit court as essentially a blanket bar to the application of issue preclusion to worker's compensation decisions. By slamming the door on the application of the doctrine of collateral estoppel to findings within a workers' compensation decision based on the procedures available in such proceedings, the majority places undue emphasis on the mere differences between such proceedings and those followed by a circuit court. I believe that such emphasis on the differences in procedures, rather than the adequacy of the workers' compensation procedures, is in direct contradiction of our holding in Steel of West Virginia and the United States Supreme Court's holding in B&B Hardware, Inc. v. Hargis Industries, Inc., 575 U.S. 138, 135 S.Ct. 1293 (2015).
The proper inquiry before us is whether the circuit court properly applied collateral estoppel to preclude relitigation of the issue of causation. I believe the answer to this question is yes.
As the majority notes, we have applied a four-part test to determine whether collateral estoppel will bar relitigation of a claim raised in a subsequent action:
Collateral estoppel will bar a claim if four conditions are met: (1) The issue previously decided is identical to the one presented in the action in question; (2) there is a final adjudication on the merits of the prior action; (3) the party against whom the doctrine is invoked was a party or in privity with a party to a prior action; and (4) the party against whom the doctrine is raised had a full and fair opportunity to litigate the issue in the prior action.Syl. Pt. 1, State v. Miller, 194 W.Va. 3, 459 S.E.2d 114 (1995).
The circuit court analyzed the four Miller factors and concluded that collateral estoppel barred Petitioners from relitigating the cause of Mr. Ruble's injuries. The majority reverses the circuit court because it finds that the requirement set forth in the fourth Miller factor, namely that "the party against whom the doctrine is raised had a full and fair opportunity to litigate the issue in the prior action" was not met in this case. Id.
In support of its conclusion that Mr. Ruble did not have a full and fair opportunity to litigate the issue of his alleged exposure in the workers' compensation proceedings, the majority references many of the rules that regulated Mr. Ruble's workers' compensation claim, and cites the manner in which they differ from the procedures in civil actions filed in circuit court. For example, the majority notes the limitations on the number of interrogatories a party may pose, as well as the fact that closing arguments were not made orally. However, the rules to which the majority refers in relation to workers' compensation cases clearly allowed claimants the right to a hearing, except as to expedited issues, on "any issue of fact or law upon which the claim administrator has made a decision within the meaning of W.Va. Code §23-5-1(b), and upon the timely filing of a protest." Mr. Ruble does not allege that he requested such hearing or that any such request was denied.
As the majority noted, in December 2022, the Board of Review asked that the procedural rules be repealed.
93 C.S.R. § 7.2.B.2(b). Significantly, while the majority notes this limitation on the number of permitted interrogatories in workers' compensation cases, Rule 33 of the West Virginia Rules of Civil Procedure places a similar limitation of forty permitted interrogatories. As of January 1, 2025, the newly revised Rule 33 of the Rules of Civil Procedure reduces this number to twenty-five. Therefore, the workers' compensation procedures actually provided litigants with the ability to pose more interrogatories than they will be permitted in a civil action beginning in 2025.
93 C.S.R. § 3.5.
93 C.S.R. § 8.1.
The rules governing proceedings before the OOJ provide for notice to the parties pursuant to 93 C.S.R. §6.7 which provides, in pertinent part:
"6.7. Manner and Receipt of NoticeAny notice required by these rules shall be deemed adequate if served upon counsel of the other parties (or upon the party if not represented by counsel) as may be permitted as in Rule 5 of the West Virginia Rules of Civil Procedure. . ."
The majority's focus on mere differences in procedures, rather than analyzing whether the workers' compensation procedures available to Mr. Ruble provided him a "full and fair opportunity" to litigate the issue of causation, is inconsistent with the Supreme Court's holding in B&B Hardware. The Court in B&B Hardware made clear that that simply because the procedural processes followed by two forums are different, does not equate with the conclusion that the procedures available in the initial forum are fundamentally unfair. The Court expressly found:
No one disputes that the TTAB and district courts use different procedures. Most notably, district courts feature live witnesses. Procedural differences, by themselves, however, do not defeat issue preclusion. Equity courts used different procedures than did law courts, but that did not bar issue preclusion. Nor is there reason to think that the state agency in Elliott used procedures identical to those in federal court; nonetheless, the Court held that preclusion could apply. Rather than focusing on whether procedural differences exist-they often will-the correct inquiry is whether the procedures used in the first proceeding were fundamentally poor, cursory, or unfair.Id, 575 U.S. at 158, 135 S.Ct. at 1309 (2015) (emphasis added) (internal citations omitted).
Clearly, the procedures available to Mr. Ruble in the workers' compensation case, while perhaps different that those to which he may be afforded before the circuit court, were not "fundamentally poor, cursory, or unfair." Elaborating on the holding in B&B Hardware, and citing the Restatement (Second) of Judgments, the Supreme Court of Alabama clarified the key elements that should be considered in determining if the forum making the initial determination should be afforded preclusive effect:
The central point expressed by the United States Supreme Court in both Solimino and B & B Hardware was that, as long as the administrative process in question has the characteristics of an adjudication, there is no reason determinations made in administrative proceedings should not have the same preclusive effect that a court decision would have. The same idea is expressed in the Restatement (Second) of Judgments § 83(1) (1982), which provides that "a valid and final adjudicative determination by an administrative tribunal has the same effects under the rules of res judicata, subject to the same exceptions and qualifications, as a judgment of a court" as long as the administrative "proceeding resulting in the determination entailed the essential elements of adjudication." Those "essential elements of adjudication" include "[adequate notice to persons who are to be bound by the adjudication" and "[t]he right on behalf of a party to present evidence and legal argument in support of the party's contentions and fair opportunity to rebut evidence and argument by opposing parties."Canton v. City of Pelham, 329 So.3d 5, 25 (2020) (emphasis added).
As to the "essential elements of adjudication" set forth in Canton¸ it is clear that each has been satisfied by the procedures that were available to Mr. Ruble in the workers' compensation proceedings. First, with regard to the requirement that there be "adequate notice to persons who are to be bound by the adjudication," it is clear that Mr. Ruble, as the party to be bound by the application of collateral estoppel here, had such notice. Indeed, he was the party who initiated the original workers' compensation case, appealed the claims administrator's denial of his claim to the OOJ, and subsequently appealed the OOJ's decision to the Board, There is no allegation here that Mr. Ruble was, in any way, deprived of adequate notice in relation to the proceedings.
Secondly, the workers' compensation procedures provided Mr. Ruble with the right "to present evidence and legal argument" in support of his contentions that his medical condition was caused by the presence of chemicals at his workplace. Indeed, while the majority makes several references to the OOJ's Rules governing "Litigation of Protests," such rules are replete with procedures and protections ensuring a claimant's right to present evidence and legal argument. Examples of such procedural protections include:
6.5. Case Summations and Arguments in Lieu of Evidence
Except for purposes of section ten [93-1-10 et seq., "Failure to Prosecute Protest"] of this Rule, parties may file argument, explanation of case, or statement of authority in a case summation (sometimes referred to as a "closing argument"). . . (Emphasis added).
6.6. Order of Presentation of Evidence
Evidence in regard to a protest shall be presented either concurrently or consecutively as set forth by Time Frame Order. The protesting party shall have the burden of going forth with evidence first in those protests with consecutive time frames. In the event that the claimant and at least one employer have protested, the parties shall proceed concurrently.
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§93-1-7. EVIDENCE; EXCHANGE and FILING.
7.1. Introduction
Evidence submitted to the Office of Judges is generally of three types: documentary evidence (i.e., reports, affidavits, treatment records, etc.); testimony of witnesses (either obtained during Office of Judges scheduled administrative hearings or during depositions scheduled by the parties); and physical evidence (i.e., photographs, video recordings, etc.). This section of the Rule relates to the obtaining, presenting, exchanging, and identifying for the Office of Judges, of all evidence regardless of type.
7.2. Rules
A. Rules of Evidence
The Office of Judges shall not be bound by the usual common law or statutory rules of evidence, or by formal rules of procedure, except as provided by these rules. An Administrative Law Judge or Hearing Examiner shall receive the relevant testimony and other timely evidence of the parties and witnesses, as may further be limited by subsections 8.1 and 8.5 [93-1-8.1 & 93-1-8.5] of this rule, and subject to objection by any party. Provided, that the parties shall not burden the record with cumulative, redundant, or repeated filing of similar evidence. All evidence filed must be relevant, material, credible and reliable. . . (Emphasis added).
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7.3. Documentary Evidence
B. Exchange of Evidence
1. Documents
The report of an expert or any other documentary evidence shall be offered in evidence by delivering the original, or an accurate copy, of such report or document to the
Office of Judges with copies to all counsel of the other parties (or to the party if not represented by counsel) as soon as can reasonably be accomplished following receipt of such report or document. . .
2. Physical Evidence
Items not susceptible to reproduction or copying shall be brought to the attention of all other parties or their counsel and reasonable opportunity for inspection of such items shall be permitted within a reasonable time. Any evidence that cannot be scanned into the Electronic Document Management System must be accompanied by a written description of the evidence, the party submitting it, the date submitted, and the protest to which it applies. The parties are encouraged to use the Office of Judges' "Description of Physical Evidence Form".
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§93-1-8. ADMINISTRATIVE HEARING PROCEDURES; GENERALLY.
8.1. Right to Administrative Hearing
Except for the expedited issues identified in W.Va. Code §23-4-1c(a)(3) and section 9 [93-1-9 et seq.] of this rule, any party to a protest shall, upon timely request, have a right to a hearing concerning any issue of fact or law upon which the claim administrator has made a decision within the meaning of W.Va. Code §23-5-1(b), and upon the timely filing of a protest. (Emphasis added).
It is undeniable that these rules, along with others not cited afforded Mr. Ruble the full and fair opportunity "to present evidence and legal argument" in support of his position as to causation.
Finally, the procedures governing the workers' compensation matter provided Mr. Ruble a "fair opportunity to rebut evidence and argument by opposing parties." In addition to the provisions already citied, the rules for operation of the workers' compensation proceeding provided ample opportunity for Mr. Ruble to rebut evidence regarding the cause of his illness, expressly providing:
7.2. Rules
C. Rebuttal Evidence
The Office of Judges recognizes that the parties may, at times, need to offer rebuttal evidence. Rebuttal evidence may, and should, be filed during any Time Frame or extension. In cases where evidence is filed at or near the end of the existing Time Frame, an extension may be granted in accordance with the rules controlling the extension of Time Frames. Rebuttal may take the form of, but not be limited to, cross-examination of witness, examination of the claimant, or filing of expert reports; provided, that additional examination of the claimant may not exceed the limit on the number of examinations that may be obtained under the provisions of subsection 7.4 [93-1-7.4] of this Rule.
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7.4. Examinations and evaluations
C. Requests for Cross-examination
A request to cross-examine the author of a report shall be made promptly in writing to the party offering the report.
D. Production of Expert Witness for Cross-examination
When cross-examination of a reporting expert is properly requested, it shall be the responsibility of the party offering the report to arrange for the appearance of the witness for cross-examination. . .
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8.3. Administrative Hearing Procedure
A. Testimony
All testimony shall be taken under oath or affirmation.
B. Cross-examination
All parties shall be given reasonable latitude in cross-examining witnesses. Cross-examination must take place in any time period set forth in a Time Frame Order.
C. Objections
An Administrative Law Judge or Hearing Examiner shall rule upon all objections to the evidence or testimony presented at the hearing or offered by deposition, taking into consideration the apparent reliability of evidence, and the basis of knowledge of a witness. All objections shall be noted in the transcript of the hearing or deposition. Exceptions to a ruling on such objections shall be automatic. Oral argument and citation of authority by the parties in support of, or opposition to, objections may be required. In the event of adverse rulings the record may be preserved for appeal by written proffer or, at the discretion of the Administrative Law Judge or Hearing Examiner, by an oral vouching of the record.
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8.4. Witnesses; Subpoenas and Fees
C. Right to Examine or Cross-Examine Witnesses
Each party is entitled to compel the attendance at a hearing of any witness whose testimony may be relevant and
material, except a party is not entitled to the presence of a witness who is deemed unavailable. . .
In light of the numerous provisions within these rules that safeguarded Mr. Ruble's right to notice, the ability to present evidence in support of his position and the ability to rebut evidence presented by his employer, such process was not "fundamentally poor, cursory, or unfair" as envisioned by the Supreme Court in B&B Hardware.
In addition, the decision in Miller requires litigants such as Petitioners to have "a full and fair opportunity to litigate the issue in the prior proceeding," but does not require that they, in fact, have exercised such opportunity. Accordingly, the operative question is not what evidence was, in fact, adduced during such proceeding, but whether Mr. Ruble had a full and fair opportunity to litigate his claim of causation. I believe he was provided such opportunity. During the workers' compensation proceedings, Mr. Ruble was represented by counsel, presented his own testimony, provided medical records and reports as well as articles from medical journals. In addition, Mr. Ruble appealed both the decision of the claims administrator and the OOJ. A review of the detailed, twenty-five page decision of the OOJ provides a list of numerous documents that were submitted and considered by the OOJ.
In addition to those portions of the rules governing proceedings before the OOJ that are expressly cited herein, there are additional rules that govern other steps and procedures, including discovery, interrogatories, subpoena power, and exchange of evidence, that I believe further provided Mr. Ruble a full and fair opportunity to litigate the issue of causation. In addition, 102 C.S.R. § 1 et seq., provides similar procedural rules for proceedings before the Board, which is the entity to which Mr. Ruble appealed the adverse determination by the OOJ.
I am further unpersuaded by Mr. Ruble's argument, which the majority apparently found compelling, that the nature of a workers' compensation claim, and the limited monetary remedies that may be available in such claim, bars the application of collateral estoppel to the determinations made in such action. Again, the holding in Miller asks us to determine whether Mr. Ruble had the opportunity to fully and fairly litigate his claim, and thus, whether he failed to take advantage of that opportunity, because he felt that spending money on discovery and experts might have consumed or exceeded his potential recovery, is not persuasive in this analysis. As the Superior Court of Pennsylvania held, in Frederick v. Action Tire Co., 744 A.2d 762 (1999):
Frederick also contends evidence favorable to him was not presented in the workers' compensation proceedings, specifically, the testimony of Drs. Gary Smith, Milton Klein, Edward James and William Welch, as well as certain expert testimony regarding the severity of the impact. We reject the contention the lack of such testimony denied him a full and fair opportunity to litigate his claim. He had ample opportunity to depose these witnesses and to present their testimony (along with supporting medical records) at the many hearings held on his claim. His unsupported assertion that his attorney had no economic incentive to take these depositions is insufficient to avoid application of collateral estoppel.Id. at 768. Here, there was copious medical evidence on which the claims administrator, the OOJ and the Board relied in rejecting Mr. Ruble's claim. The fact that Mr. Ruble did not believe it to be economically advantageous to provide additional evidence to rebut that evidence or to take additional testimony does not support his position that collateral estoppel should not apply.
Finally, the majority gives weight to the fact that the Respondents were not parties to the workers' compensation action and, therefore, the application of collateral estoppel would be in a "third-party" tort action. However, the party against which the issue preclusion is sought here is not a third-party but, indeed, is the plaintiff or petitioner in both actions. In Miller, we expressly found that the fourth factor, namely whether the party had a "full and fair opportunity" to litigate the issue in the prior action, applied to "the party against whom the doctrine of collateral estoppel is raised." In this case, there is no question that the doctrine is being raised against Mr. Ruble in order to preclude him from relitigating the issue of causation of his medical condition. Accordingly, the fact that the tort action is against third parties who were not part of the original workers' compensation action does not bar the application of collateral estoppel.
Moreover, various jurisdictions have expressly applied collateral estoppel to prevent relitigating claims against third-party defendants. See Young v. Gorski, 2004 WL 540944 (Ohio Ct. App. Mar. 19, 2004); Frederick v. Action Tire Co., 744 A.2d 762 (Pa. Super. Ct. 1999); Duncan v. Lone Star Indus. Inc., 2019 WL 3997290 (E.D. Mo. Aug. 23, 2019). Therefore, because Mr. Ruble is the party against whom collateral estoppel is sought to be applied, the fact that the Respondents were not parties to workers' compensation matter would preclude the application of collateral estoppel as determined by the circuit court.
Aside from the specific facts of this case, I am concerned with the potential precedential effect of the majority's holding that the procedures governing administrative tribunals, in this case the workers compensation OOJ and the Board, did not provide Mr. Ruble a full and fair opportunity to litigate the issue of causation. Numerous administrative agencies conduct hearings and proceedings governed by their own specific procedural rules. The majority's findings that such procedures here do not provide a full and fair opportunity to parties to litigate specific issues could unjustly call into question the applicability of collateral estoppel in relation to a myriad of other administrative proceedings and agencies.
As the Supreme Court held in B&B Hardware:
Both this Court's cases and the Restatement make clear that issue preclusion is not limited to those situations in which the same issue is before two courts. Rather, where a single issue is before a court and an administrative agency, preclusion also often applies. Indeed, this Court has explained that because the principle of issue preclusion was so "well established" at common law, in those situations in which Congress has authorized agencies to resolve disputes, "courts may take it as given that Congress has legislated with the expectation that the principle [of issue preclusion] will apply except when a statutory purpose to the contrary is evident." This reflects the Court's longstanding view that" '[w]hen an administrative agency is acting in a judicial capacity and resolves disputed issues of fact properly before it which the parties have had an adequate opportunity to litigate, the courts have not hesitated to apply res judicata to enforce repose.' "B&B Hardware, 575 U.S. at 148, 135 S.Ct. at 1303 (internal citations omitted). Here, as in B&B Hardware, the OOJ and the Board were acting in a judicial or quasi-judicial capacity in accordance with rules promulgated for conducting such proceedings. I believe those rules, while different from rules governing proceedings in a circuit court, adequately safeguard the parties right to a full and fair opportunity to litigate the issues in dispute.
In summary, Mr. Ruble has alleged an occupational disease resulting from his exposure to toxic chemicals. He failed to prove in his workers' compensation claim that the medical conditions he allegedly suffered were caused by chemical exposure during his employment at the Lesage facility. After learning that he had received an adverse causation determination from the Board, he voluntarily dismissed his employers from his civil action and sought to proceed against the third-party chemical companies for causing the same medical conditions that were alleged in his workers' compensation claim. I believe that the doctrine of collateral estoppel bars Petitioners from relitigating the issue of causation in their civil action against Respondents.
For the reasons stated above, I believe that the circuit court correctly determined that Petitioners were collaterally estopped from litigating the issue of causation for their alleged injuries, and I respectfully dissent from the majority's reversal of the circuit court's order dismissing the Petitioner's action in this matter.
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