Boeing Co. v. Heidy

• Decision Date: 08 August 2002
• Docket Number: No. 71694-3.,71694-3.
• Citation: 147 Wash.2d 78,51 P.3d 793
• Parties: The BOEING COMPANY, Appellant, v. Carl HEIDY; William McGraw; The Department of Labor and Industries, Respondents.
• Court: Washington Supreme Court

51 P.3d 793

147 Wash.2d 78

The BOEING COMPANY, Appellant, v. Carl HEIDY; William McGraw; The Department of Labor and Industries, Respondents.

No. 71694-3.

Supreme Court of Washington, En Banc.

Argued March 21, 2002.

Decided August 8, 2002.

Craig, Jessup & Stratton, Gilbert Stratton, Bernadette Pratt, Seattle, for Appellant.

Putnam & Lieb, Frederick Lieb, Olympia, Christine Gregoire, Attorney General, Mary Wilson, Anastasia Sandstrom, Assistant Attorneys General, for Respondents.

William Hochberg, Edmonds, Amicus Curiae on Behalf of Washington State Labor Council.

Michael Pontarolo, Bryan Harnetiaux, Debra Stephens, Spokane, Amicus Curiae on Behalf of Washington State Trial Lawyers Association.

Craig Staples, Vancouver, Amicus Curiae on Behalf of Washington Self-Insurers Association.

JOHNSON, J.

The key issue in this case, reduced to its essence, is whether an employer can reduce a worker's permanent partial disability award for work-related hearing loss because people of that worker's age generally suffer from age-related hearing loss. The Department of Labor and Industries, the Board of Industrial Insurance Appeals, and two superior courts said no. We affirm.

FACTS

In June 1995, Carl Heidy (Heidy) filed a claim for benefits with the Department of Labor and Industries (Department) alleging he suffered from occupational noise-related hearing loss (NRHL). The Department ordered Heidy's former self-insured employer (SIE), The Boeing Company (Boeing), to pay Heidy a permanent partial disability (PPD) award of 31.56 percent for his hearing loss based on the schedule in effect when he retired. Boeing appealed to the Board of Industrial Insurance Appeals (Board). William McGraw (McGraw) filed a similar claim for benefits in November 1995. The Department ordered McGraw's former employer, Boeing, to pay McGraw a PPD of 23.75 percent for his hearing loss. Boeing appealed to the Board.

Heidy and McGraw's claims were consolidated with seven other similar claims before the Board for the purpose of taking testimony. The nine claims shared certain facts: each claimant suffered NRHL and age-related hearing loss (ARHL) (presbycusis); the Department ordered the respective SIE's to pay a PPD award for 100 percent of the workers' hearing loss; and the Department calculated the awards using the benefit schedule in effect on the workers' last day of work. The SIE's argued in favor of segregating ARHL from NRHL by using a median-based allocation method developed by Dr. Robert Dobie.

The Board held the present methods of differentiating between ARHL and NRHL were not scientifically reliable. The Board went on to state that, as a matter of law, "Washington ... does not permit a reduction in a worker's permanent partial disability benefits to account for aging's contribution to hearing loss." Heidy Certified Appeal Board R. (CABR) Clerk's Papers (CP) at 29.¹

The Board also rejected the Department's unwritten policy of categorically rejecting audiograms conducted more than one year before a worker's retirement. However, it held that "where the evidence shows a worker continued to be placed in a noisy work environment after the date of a given audiogram... the burden appropriately shifts to the employer to show by persuasive evidence that subsequent workplace noise was not injurious to the worker's hearing." Heidy CABR CP at 14.

In Heidy's case, the Board rejected an audiogram taken almost four and one-half years after Heidy's retirement in favor of an audiogram taken almost one and one-half years before Heidy retired. The Board rejected the postretirement audiogram because it showed conductive hearing loss (which is different from ARHL), whereas the preretirement audiograms showed NRHL. In McGraw's case, the Board rejected an audiogram taken 13 months before retirement in favor of an audiogram taken approximately eight years after retirement. It did so because McGraw was exposed to 13 months of workplace noise after the preretirement audiogram, and the additional hearing loss was not inconsistent with NRHL. The Board concluded the incremental increase in hearing loss between the preretirement and postretirement audiograms (19 percent binaural impairment versus 23.75 percent binaural impairment) was best accounted for by the 13 months of workplace exposure to noise.

Finally, the Board held hearing loss becomes partially disabling when the average loss exceeds 25 decibels across the frequencies specified in the American Medical Association Guides. It also acknowledged that unlike most other occupational diseases, a worker may be partially disabled by NRHL without knowing of his or her condition. The Board found this anomaly unacceptable and held, "to ensure that the `partially disabling' trigger to start the schedule of benefits for occupational diseases be applied fairly to all workers, ... there be a showing that the worker also has knowledge of limitations in his or her hearing." Heidy CABR CP at 20.

This knowledge requirement had no effect in McGraw's case. In Heidy's case, the Board declined to apply the schedule of benefits in effect in 1975, when an audiogram first showed Heidy was partially disabled. Instead, it applied the schedule of benefits in effect on July 12, 1978, when Heidy was first fitted with hearing aids. The schedule of benefits was identical, regardless of which date applied. The cases were deconsolidated and Boeing appealed each of the decisions to the superior court with jurisdiction (King County in Heidy's case; Pierce County in McGraw's case). The Department also appealed the decision in McGraw's case. The superior court in Heidy's case held that segregating ARHL from NRHL in a PPD award is forbidden following the reasoning of Weyerhaeuser Co. v. Tri, 117 Wash.2d 128, 814 P.2d 629 (1991). Having forbidden segregation as a matter of law, the superior court did not address whether segregation was medically possible. The court reversed the Board's burden-shifting rule and knowledge requirement. It also awarded attorney fees to Heidy's counsel.

The superior court in McGraw's case adopted every conclusion of law set forth by the Board, except that involving when McGraw knew of his partial disability. The court characterized that issue as moot. The court also awarded attorney fees to McGraw's counsel, the same lawyer who represented Heidy, and applied a 1.25 multiplier to the lodestar amount. Boeing appealed the segregation, burden-shifting and knowledge issues and the award of attorney fees and the application of a 1.25 multiplier.²

Both Division One and Division Two of the Court of Appeals certified the respective appeals to this Court on the grounds they involved "a fundamental and urgent issue of broad public import which requires prompt and ultimate determination." RAP 4.2(4). We accepted certification of both cases and reconsolidated them for our review.

ANALYSIS

The Board held Washington law forbids segregation as a matter of law. While the superior court in McGraw's case simply adopted the Board's conclusion, the superior court in Heidy's case held segregation was forbidden as a matter of law under Weyerhaeuser Co. v. Tri, 117 Wash.2d 128, 814 P.2d 629. In Tri, we addressed the issue of apportioning worker's compensation risk between successive employers or insurers. This case involves the different issue of segregating an occupational disease from a nonoccupational disease. Tri does not control the resolution of this case.

In support of their argument for segregating ARHL from NRHL, Boeing relies on the testimony of Dr. Robert Dobie, who developed a statistical methodology to segregate ARHL from NRHL. Although Dr. Dobie advocates using several methods to allocate hearing loss to noise exposure or age, the only method at issue in this case is his median-based allocation method. The median-based allocation method uses epidemiological data³ to segregate ARHL from NRHL. Dr. Dobie explained it in simple terms:

[Y]ou basically look at the amount of [hearing] loss to be expected for that individual, given his age, and look at the amount of loss to be expected from what you know about the noise exposure [based on Databases A and B]. [Y]ou then say, in my judgment, the fairest allocation is the one that is in proportion to those two; that if a group of people working in 90 dBA for 40 years ended up having three quarters of their loss at age 60 being age-related and a quarter of it being noise induced, that that's a proper division of responsibility for the individual who's 60 years old and worked for 40 years in that noise exposure.

Heidy CABR Tr. 53-54 (Test.Dobie).

Dr. Dobie's testimony summarizes the flaw with the median-based allocation method; it does not assist a doctor in determining the actual extent to which an individual suffers from ARHL. At best, it allows a doctor to compare an individual's age and hearing loss percentage to a smoothed-data⁴ chart based on information not intended to be used to assess individuals. The doctor can then "norm" the individual's actual hearing loss percentage so that it reflects the median amount of ARHL expected by a person of that age. However, under the Industrial Insurance Act (Act), the amount of compensation for a particular injury focuses specifically on the injured individual and the extent of his or her injuries. Statistical studies showing tendencies within given age groups do not help triers of fact determine the actual extent of workers' individual work-related diseases.

Also, Act is to be "liberally construed for the purpose of reducing to a minimum the suffering and economic loss arising from injuries and/or death occurring in the course of employment." RCW 51.12.010. All doubts about the meaning of the Act must be resolved in favor of workers. Clauson v. Dep't of Labor & Indus., 130 Wash.2d 580, 584, 925 P.2d 624 (1996). When faced with a circumstance where either workers or employers will bear the burden of an imperfect...