WCB Appellate Division Upholds Benefit Termination By Successor Corporation

The Maine Worker's Compensation Board Appellate Division has just issued a decision upholding a decree terminating an employee's benefits pursuant to the durational limit in §213. The basis of the decision, however, is limited and seems to allow other employees to make a similar argument in future cases.

In Ouellette v. Twin Rivers, Ouellette injured his knee in 2002 working for Fraser Paper. He had filed a Petition for Review, resulting in a 2012 decree ordering partial incapacity benefits. By the time of that decree, however, Fraser Paper had been acquired by Twin Rivers, which was the employer name used in both Ouellette's petition and the WCB's decree, and in a prior decree in 2010 which expressly mentioned that the injury occurred while the employee was "working for the employer's predecessor company, Fraser Paper."

Sometime after 2012, Twin Rivers filed its petition to terminate benefits per §213, and Ouellette claimed that Twin Rivers was not his employer at the time of his injury, and therefore benefit payments by Twin Rivers did not count toward the 520-week durational limit. In 2014, Judge Pelletier granted Twin Rivers’ petition, allowing it to terminate Ouellette’s partial incapacity benefits under §213, and Ouellette appealed.

The Appellate Division upheld Judge Pelletier's decision and denied Ouellette’s appeal on grounds of res judicata, holding that the prior decrees had already named Twin Rivers as the employer and had found that Ouellette was injured while working for its predecessor company, Fraser, and that Twin Rivers’ status as the employer could not be re-litigated. The panel, however, did not hold that any successor corporation inherits its predecessor's legal rights under §213, thus potentially leaving that issue to be resolved in other cases.

We recommend that, whenever an employer changes its name or its ownership, the employer in any subsequent litigation present whatever evidence is needed to ensure that the decree establishes the change in status, to allow the successor entity to assert all of its rights under the Act. If you have any questions about this or any other case, please let us know.

Thomas Getchell
Michael Richards
Daniel Gilligan
Attorneys at Law