A California appeals court ordered two insurance companies to pay millones de dólares to occupational asbestos exposure victims, per the workers’ compensation insurance policies the company had with Manny, Moe, and Jack.

The dispute stemmed from claims filed alleging harm from asbestos in Pep Boys products. In 2004, the company sought coverage under general and excess liability policies it bought that provided coverage between Feb. 1, 1981, and July 1, 1982. According to court documents, the policies had originally been for one year, but Pep Boys extended them to align the coverage period with its financial year.

“Both parties ask us to apply ‘annual period’ to terms more than or less than a year: Seventeen months, in Old Republic’s view, or five months, under Pep Boys’ approach. As a textual matter, neither reading accords with the literal meaning of ‘annual,’ and neither is more reasonable than the other,” the ruling states.

Therefore, as is the custom in these cases, the court ruled in favor of Pep Boys. In insurance disputes, ambiguities in policy language are generally interpreted in favor of the policyholder.

Workers’ Compensation Nuts and Bolts

Before we delve into job injury and asbestos exposure matters, let’s briefly establish some context and examine workers’ compensation in general. Rules for these state-administered plans vary in different jurisdictions, but they’re fundamentally the same, at least for the most part.

Generally, workers’ compensation pays no-fault benefits that compensate injured workers for economic losses, mostly:

  • Facturas médicas: Workers’ compensation pays all reasonably necessary medical bills related to an on-the-job trauma injury, like a fall, or occupational disease, like mesotelioma. Reasonably necessary medical expenses usually include transportation, emergency care, follow-up care, physical therapy, and ancillary costs, such as prescription drugs.
  • Salarios perdidos: Most victims receive two-thirds of their AWW (average weekly wage) for the duration of their permanent or temporary disabilities. The AWW includes cash compensation and non-cash compensation, such as a housing allowance. The AWW also must account for future income changes (e.g. Tom’s injury causes him to miss a performance bonus milestone).

Wage replacement regulations vary somewhat. Some state laws mandate long waiting periods. Medical treatment laws vary even more. In some states, victims choose their own doctors. Other states require injured workers to see a company doctor. Other states are somewhere in the middle. Usually, a victim must choose an approved private physician.

These benefits are available even if the victim was 100 percent at fault for the illness or injury, as long as that illness or injury was work related. Usually, workers’ compensation is the exclusive remedy for work-related illness and injury matters. 

Other no-fault benefit plans include VA disability and SOcial Security Disability. VA benefits for service-related injuries or illnesses include monthly cash and comprehensive medical care. The amount of cash depends on the nature and extent of the disability. SSD benefits are available if the applicant is permanently disabled (unable to work) due to an illness or injury.

Bear in mind this discussion is just the thumbnail view. Workers’ compensation and other cases are very complex and denial rates are very high, especially if the victim doesn’t have a lawyer.

Automotive Workers and Asbestos Exposure

Many workers are at risk for mesothelioma and other asbestos exposure injuries. The risk is doubled for automotive and auto parts workers, especially those who worked in the industry before 1980. 

Asbestos is a mineral that doesn’t conduct heat, sound, or electricity. Partially because of these qualities, before 1980, builders used asbestos in almost all manufacturing, retail, and other commercial structures, mostly in:

  • Attic insulation,
  • Drywall,
  • Pipe insulation,
  • Roof tiles,
  • Electrical insulation, and
  • Floor/ceiling tiles.

A tiny hairline crack in a wall or ceiling could allow asbestos fibers or dust to enter the air. A single fiber or dust particle could cause cancer, like mesothelioma, or a lung disease, like asbestosis.

Furthermore, the auto parts these workers handled often contained asbestos, mostly because of its fireproofing qualities. Examples include:

  • Brake pads,
  • Air hoses,
  • Gaskets,
  • Clutches, and
  • Hood liners.

Efficiency was one reason for widespread asbestos use. Low cost was the other reason. Especially after the Industrial Revolution of the early 1900s, asbestos mining was one of the cheapest mining operations. Asbestos mining was legal in the United States until 2002.

Indirect exposure is an issue as well. Asbestos fibers float into common areas, like parking lots, cafeterias, and offices. Furthermore, many workers carried asbestos fibers home, mostly because the company failed to warn these workers about the risk.

Asbestos and Workers’ Compensation

Asbestos illnesses are difficult to diagnose and environmental cancer often has more than one cause. Insurance company lawyers often use these arguments to reduce or deny compensation in these cases. 

Medical Diagnosis

The overall cancer misdiagnosis rate is very high. The mesothelioma misdiagnosis rate is even higher, because this form of cancer is so rare.

Mesothelioma tumors usually form between the heart and lungs. They grow almost undetected for at least forty or fifty years before victims show any outward sign of illness. When these outward signs appear and doctors see a spot in the upper lung, they usually assume the victim has NSCLC (non-small cell lung cancer), the most common form of lung cancer. 

Usually, NSCLC isn’t very aggressive and, in many cases, the cancer is almost manageable, like diabetes. Mesothelioma is much more aggressive. Most cancer treatments, like moderate chemotherapy drugs, don’t dent mesothelioma tumors.

These diagnosis issues could be a problem if victims cannot choose their own doctors. Company doctors always put workers back on the job as soon as possible. So, in these situations, our asbestos exposure lawyers usually partner with independent doctors. Even in the most restrictive states, victims usually have a right to obtain a second opinion.

Pre-Existing Condition

The line between work-related and non-work-related is rather fuzzy. In most states, full benefits are available if a work-related condition substantially caused the victim’s injury.

According to the AMerican Lung Association, smokers are twenty times more likely to develop lung cancer than nonsmokers. However, most ALA and other researchers agree that asbestos is mesotjelioma’s primary cause. 

Assume Bill is speeding on a wet read when he loses control of his car. The wet road contributed to the wreck, but Bill’s excessive speed substantially caused it. Many other motorists drove on that same wet road without issue.

So, in most cases, insurance company lawyers cannot use smoking or another non-work-related contributing cause as an excuse to reduce or deny benefits.

As mentioned, in most states, workers’ compensation is the exclusive remedy for work-related occupational disease claims. In this context, “exclusive” basically means “primary.” Other options are available.

For example, in the above story, if the insurance companies didn’t pay these claims, the victims could sue Pep Boys directly. 

In a civil case, the victim must prove negligence, or a lack of care, by a preponderance of the evidence, or more likely than not. However, if the company didn’t have insurance, it cannot use some magic bullet defenses, such as comparative fault, at least in moist states.

If the victim proves negligence, additional compensation for emotional distress and other noneconomic losses is available. Significant punitive damages may be available as well.

As mentioned, asbestos exposure illnesses usually have extensive latency periods. By the time illness appears, the responsible company is often bankrupt. If that’s the case, a bankruptcy victim compensation fund claim might be an option. 

Procedurally, VCF claims are much like workers’ compensation and other no-fault claims. However, since there’s no court supervision, these claims can be difficult to resolve.