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–>In a surprising turn-around Walmart has decided to drop its effort to collect $400,000 in money awarded to a brain damaged former employee, says the Associated Press.
The world’s largest retailer said Tuesday in a letter to the family of Deborah Shank it will not seek to collect money the Shanks won in an injury lawsuit against a trucking company for the accident.
Wal-Mart’s top executive for human resources, Pat Curran, wrote that Shank’s extraordinary situation had made the company re-examine its stance.
Deborah’s husband Jim Shank welcomed the news. Family lawyer Maurice Graham of St. Louis said Wal-Mart deserves credit for doing the right thing.
‘It’s a good day for the Shank family,’ Jim Shank said in a statement.
Wal-Mart has been roundly criticized in newspaper editorials, on cable news shows and by its union foes for its claim to the funds, which it made in a lawsuit upheld by a federal appeals court.
Walmart says its internal rules required it to seek reimbursement for medical costs, but it has now revised those rules so that it can make exceptions in individual cases. Some experts think that Walmart is concerned about the issue attracting pressure from lawmakers.
The case put a spotlight on the growing use of reimbursement claims by health plans, experts say.
Roger Baron, professor of law at the University of South Dakota and a specialist in health-plan law, said health plans have become ‘very aggressive’ about subrogation since the 2006 Supreme Court decision.
‘It’s free money. They want the free money,’ Baron said.
Lynn Dudley, vice president for policy at the American Benefits Council in Washington D.C., said the negative publicity around the case was beginning to draw the attention of lawmakers who might want legislation to stop or limit subrogation.
‘Capitol Hill is paying attention,’ Dudley said.
Wal-Mart drops injured worker claim [AP]
(Photo:CrawfishPie)
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This is the exact reason why justice is blind. The courts ruled on fact, not on heart. I find it warming and frightening at the same time when reading the consumerist remarks.
One simple thing remains… consider the FACTS.
1. The court ruled in her favor.
2. Supreme Court declined to act AT ALL (they agree by abstention IMO).
I love how the consumerist is far smarter than the US COURT SYSTEM and how the FACTS are meaningless here if there is a good enough story.
SHAME ON CONSUMERIST!
@EvilConservative:
Her comment isn’t misinformed at all. The price of the premium is large, and it reflects the carrier’s assumption that it will be absorbing the loss. I’ve talked to insurance actuaries before about this; the subrogation benefits are speculative and not normally priced into the premium.
3DLADY’s point is exactly the same as mine: one cannot legitimately accuse the plaintiff of seeking some kind of unjust double compensation without also acknowledging that the insurer is seeking the same thing. Even though it received insurance premiums from policyholders, and even though it priced those premiums such that it would be able to absorb the loss, it now wants to use the subrogation clause to win an unexpected recoupment of all its paid-out benefits.
That, I would imagine, is why, according to the article linked above, there is potential for regulation of the practice.
I can’t imagine that the suit against the truck company was only for expenses already incurred and paid by insurance. Because then what would be the point? To get the lawyer and WalMart some money from the truck company?
Maybe this lady has a nice malpractice suit against her lawyers?
It seems like the exact opposite of what some people are suggesting could be occurring, depending on the purpose of the award from the trucking company.
Rather than the woman trying to get money she rightly needs by the wrong means (double dipping), it seems that it could be the insurance/WalMart trying to take advantage of a greater percentage of the windfall than what was alloted from the trucking company for the expenses that had already been paid. Kind of like if you won the lottery after your claim and they tried to sue you for your winnings.
Perhaps the insurance and WalMart were legally entitled to either none of it or only a smaller portion of it. Perhaps none of the award was for covered expenses, or only a portion of the award was for covered expenses and didn’t cover all of the expenses. Some of amount they are suing for may have been for other issues (future expenses beyond what insurance covers, pain and suffering, etc)
…
Are there any laws about subrogation claims regarding lawyer expenses? If it’s doing the insurance a favor, shouldn’t they take half the hit?
Nice they dropped the case against her but one point I cant seem to look over here. The family sued for something like $900K to 1Mil right? They only got $400K of that? What in the hell could the lawyers POSSIBLY be doing that could justify them taking 60% of the poor womans money? Walmart should go sue the pants off those scum sucker ambulance chasers for their money not the lady in the nursing home.
” Wal-Mart deserves credit for doing the right thing.”
Oh god, walmart must be THE most pitiful company out there, pitiful.
@Paul: Agreed. Walmart gave it up because it was bad PR that was going to cost them more than doing the legal thing.