Antitrust Law Daily Wrap Up, RICO NEWS: Injured government contractor employees bring benefits fight to High Court, (Nov 12, 2015)

By Greg Hammond, J.D.

A group of U.S. government contractor employees, who suffered severe injuries in Iraq and Afghanistan, are asking the Supreme Court to review a decision by the U.S. Court of Appeals in Washington, D.C., which affirmed dismissal of the contractors’ claims brought under the Racketeer Influenced and Corrupt Organizations Act (RICO) (Brink v. Continental Insurance Co., Dkt. 15-604).

The plaintiffs filed suit against several government contractors, insurance companies, and third parties for denial of medical benefits owed to them under the Defense Base Act. The contracting companies purportedly cut off medical benefits; delayed providing benefits; made false statements and misrepresentations concerning payment of Base Act benefits while actually reducing, denying, or ignoring the plaintiffs’ medical needs; failed to comply with orders to pay benefits; threatened or discouraged workers from making Base Act claims; and terminated appellants’ employment after they were disabled by their Base Act covered injuries.

The D.C. Circuit affirmed the lower court’s order dismissing the plaintiffs’ RICO claims, agreeing that the statutory scheme of the Base Act and Longshore and Harbor Workers’ Compensation Act contain exclusive remedies that leave no room for RICO claims.

The petition asks: (1) Whether the Longshore Act’s exclusive remedy provision excludes not only accidental injuries directly related to the “work” of covered workers but also injuries that are secondary and new—that were not caused by the “work” itself, but are independent, caused by the new, supervening, intentional, and malicious conduct of Insurance Companies—inducing new and independent injuries wholly unrelated to the original covered “work” itself; (2) Whether the Longshore Act’s exclusive remedy provision can be construed to reach beyond regulation of compensation for injuries suffered while doing the “work” covered by the act to define what is and is not actionable outside the Act, or whether there is some further comprehensive scheme that preempts tort actions, excluding actions against Insurance Companies and/or Contracting Companies for new injuries inflicted in the United States, unrelated to the covered work itself, not in the course of the covered employment, not on account of the original injury suffered while working, affecting entirely new injuries and harms caused by independent and supervening intentional acts; and (3) Whether RICO can apply to an “enterprise” created by contracting Companies, their insurance carriers, and third party administrators who utilize the enterprise to commit fraudulent acts that proximately caused independent harm to covered workers and their families, and thousands similarly situated persons.

Attorneys: Scott J. Bloch (Law Offices of Scott J. Bloch, P.A.) for Petitioners.

Companies: Continental Insurance Co.

News: RICO