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In the Matter of the Worker's Compensation Claim of v. State of Wyoming

May 17, 2013

IN THE MATTER OF THE WORKER'S COMPENSATION CLAIM OF: KIRK JACOBS, APPELLANT (PETITIONER),
v.
STATE OF WYOMING, EX REL.,
WYOMING WORKERS' SAFETY AND COMPENSATION DIVISION, APPELLEE (RESPONDENT).



Appeal from the District Court of Laramie County The Honorable Peter G. Arnold, Judge

The opinion of the court was delivered by: Burke, Justice.

Before KITE, C.J., and HILL, VOIGT, BURKE, and DAVIS, JJ.

] NOTICE: This opinion is subject to formal revision before publication in Pacific Reporter Third. Readers are requested to notify the Clerk of the Supreme Court, Supreme Court Building, Cheyenne, Wyoming 82002, of any typographical or other formal errors so that correction may be made before final publication in the permanent volume.

[¶1] The Wyoming Workers' Safety and Compensation Division awarded benefits to Appellant, Kirk Jacobs, after he experienced a workplace injury. Mr. Jacobs sought payment for prescription medication that he claimed was related to his workplace injury. The Division denied the claim. Mr. Jacobs requested a contested case hearing, and the Medical Commission upheld the Division's determination. Mr. Jacobs appealed to the district court, which affirmed the Medical Commission's order. He challenges the district court's decision in this appeal. We affirm.

ISSUES

[¶2] Mr. Jacobs states the issues as follows:

I. Was the commission decision holding that Mr. Jacobs did not meet his burden of proof that he was entitled to continuation of medical benefits supported by substantial evidence?

II. Did the Division's prior determination, assigning a 78% whole body permanent physical impairment rating, establish as a matter of law that Mr. Jacobs' chronic abdominal pain was directly related to his initial compensable toe injury?

III. Did the commission properly apply the recognized second compensable injury burden of proof?

The Division phrases the issues as follows:

I. Did the Commission apply the proper burden of proof for a second compensable injury when it required Jacobs to establish a causal connection between his abdominal pain and his Keflex ingestion?

II. Did substantial evidence support the Commission's determination?

FACTS

[¶3] This is the fifth time Mr. Jacobs' case has been before this Court. See State ex rel. Wyo. Workers' Comp. Div. v. Jacobs, 924 P.2d 982 (Wyo. 1996) (Jacobs I); Jacobs v. State ex rel. Wyo. Workers' Safety & Comp. Div., 2004 WY 136, 100 P.3d 848 (Wyo. 2004) (Jacobs II); Jacobs v. State ex rel. Wyo. Med. Comm'n, 2005 WY 104, 118 P.3d 441 (Wyo. 2005) (Jacobs III); Jacobs v. State ex rel. Wyo. Workers' Safety & Comp. Div., 2009 WY 118, 216 P.3d 1128 (Wyo. 2009) (Jacobs IV). This appeal, however, represents the first time that the connection between Mr. Jacobs' workplace injury and his abdominal pain has been ripe for our review. Despite the long and complicated procedural history in this case, the facts pertinent to this appeal are relatively straightforward.

[¶4] Mr. Jacobs experienced a work-related injury in September, 1982, when he dropped a piece of rebar on his right fifth toe. He had surgery to repair the toe in December, 1982, and he subsequently developed an infection in the toe. His treating physician prescribed a ten-day course of Keflex, an antibiotic, to stop the infection from spreading. After taking the second dose of Keflex, Mr. Jacobs experienced abdominal pain and swelling. He contacted his treating physician and told him about the pain, but was instructed to continue taking the antibiotic. Towards the end of his course of Keflex, Mr. Jacobs began producing loose, bloody stools. He was referred to Dr. Bertrand Honea, an internist, who diagnosed Mr. Jacobs with antibiotic-induced colitis. Over the next couple of years, Mr. Jacobs' colitis periodically returned after he consumed monosodium glutamate (MSG). The colitis eventually resolved after Mr. Jacobs started monitoring the ingredients in the food he consumed and adjusted his diet to eliminate MSG. However, he continued to experience chronic abdominal pain, which he claims has never subsided.

[¶5] The Workers' Safety and Compensation Division awarded temporary total disability benefits to Mr. Jacobs following his workplace injury. In 1990, after initially questioning whether Mr. Jacobs' impairment was related to his original workplace injury, the Division awarded permanent partial impairment benefits to Mr. Jacobs based on a 78% whole body impairment rating provided by Dr. Carol Newlin. The Division paid impairment and medical benefits to Mr. Jacobs until March, 2003, when the Division issued a final determination denying benefits relating to treatment of Mr. Jacobs' abdominal pain. The Division concluded that treatment for Mr. Jacobs' abdominal pain, which included prescriptions for pain medication, was not related to his original workplace injury.

[¶6] Mr. Jacobs objected to the Division's final determination and requested a contested case hearing. The Medical Commission held the contested case hearing on October 28, 2003 to determine whether Mr. Jacobs' abdominal pain was related to his original workplace injury. However, as we explained in Jacobs IV, ¶ 7, 216 P.3d at 1131, before the Commission could issue a decision on the merits, both the Division and Mr. Jacobs filed competing motions requesting summary judgment on grounds of res judicata and collateral estoppel. The Commission granted the Division's motion after concluding that Mr. Jacobs' claim for benefits relating to his chronic abdominal pain was barred by the doctrine of collateral estoppel. Id. We reversed the Commission's decision in Jacobs III, after finding that the Commission did not have subject matter jurisdiction to decide the claim. Jacobs IV, ¶ 8, 216 P.3d at 1131. Following remand, the case was ultimately referred to the Office of Administrative Hearings (OAH). Id., ¶ 9, 216 P.3d at 1131. Based on the evidence in the record, the OAH concluded, as the Medical Commission had, that Mr. Jacobs' claim for benefits related to his chronic abdominal pain had already been decided and was barred under the doctrines of res judicata and collateral estoppel. Id., ¶ 13, 216 P.3d at 1132-33. We reversed that decision in Jacobs IV, after finding that, because no prior adjudication had resulted in a judgment on the merits, the OAH should not have decided the matter on collateral estoppel. As a result, we remanded the case once again. Id., ¶ 17, 216 P.3d at 1134.

[¶7] Upon remand from Jacobs IV, after both parties submitted disclosure statements containing numerous exhibits, the Medical Commission held a contested case hearing on October 28, 2010. After the hearing, the Commission issued an order affirming the Division's March 27, 2003 final determination denying benefits relating to treatment of Mr. Jacobs' abdominal pain. The Commission concluded that Mr. Jacobs had failed to provide credible medical evidence to support the contention that his abdominal pain was causally related to his workplace injury. Mr. Jacobs appealed the Commission's decision to the district court, and the district court affirmed. He timely filed this appeal.

STANDARD OF REVIEW

[¶8] Review of an administrative agency's action is governed by the Wyoming Administrative Procedure Act, which provides that:

(c) To the extent necessary to make a decision and when presented, the reviewing court shall decide all relevant questions of law, interpret constitutional and statutory provisions, and determine the meaning or applicability of the terms of an agency action. In making the following determinations, the court shall review the whole record or those parts of it cited by a party and due account shall be taken of the rule of prejudicial error. The reviewing court shall:

(ii) Hold unlawful and set aside agency action, findings and conclusions found to be:

(A) Arbitrary, capricious, an abuse of discretion or otherwise not in accordance with law;

(B) Contrary to constitutional right, power, privilege or immunity;

(C) In excess of statutory jurisdiction, authority or limitations or lacking statutory right;

(D) Without observance of procedure required by law; or

(E) Unsupported by substantial evidence in a case reviewed on the record of an agency hearing provided by statute.

Wyo. Stat. Ann. § 16-3-114(c) (LexisNexis 2009). We review an administrative agency's findings of fact pursuant to the substantial evidence test. Dale v. S & S Builders, LLC, 2008 WY 84, ¶ 22, 188 P.3d 554, 561 (Wyo. 2008). Substantial evidence is relevant evidence which a reasonable mind might accept in support of the agency's conclusions. Id., ¶ 11, 188 P.3d at 558. Findings of fact are supported by substantial evidence if, from the evidence in the record, this Court can discern a rational premise for the agency's findings. Middlemass v. State ex rel. Wyo. Workers' Safety & Comp. Div., 2011 WY 118, ¶ 11, 259 P.3d 1161, 1164 (Wyo. 2011). When the hearing examiner determines that the burdened party failed to meet his burden of proof, we will decide whether there is substantial evidence to support the agency's decision to reject the evidence offered by the burdened party by considering whether that conclusion was contrary to the overwhelming weight of the evidence in the record as a whole. Dale, ¶ 22, 188 P.3d at 561.

[¶9] The arbitrary and capricious standard of review is used as a "safety net" to catch agency action which prejudices a party's substantial rights or which may be contrary to the other review standards under the Administrative Procedure Act, yet is not easily categorized or fit to any one particular standard. Dale, ¶ 23, 188 P.3d at 561. The arbitrary and capricious standard applies if the agency failed to admit testimony or other evidence that was clearly admissible, or failed to provide ...


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