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MSZL&M and Gibson Robb Lindh Secure Win for Extra-Contractual Damages Against Client’s Vendor in California that Could Double the Workers Compensation Lien

On February 11, 2017 an employee of our client, a national retailer, was injured when a rug flipper fell off the wall of a newly retrofitted store.  Mintzer Sarowitz Zeris Ledva & Meyers, LLP was called in to make a claim for the workers compensation lien against a national vendor of the client under a contractual claim with a strong indemnity provision.  Rather than resolve the lien for the payments of medical and indemnity in the amount of approx. $157,000.00, the claim was denied.

Upon the filing of a third party claim by the injured employee, we retained our local firm Gibson Robb & Lindh in San Francisco, CA to file a separate Complaint and proceed with discovery.  After continued refusal to resolve the contractual claim, a Motion for Summary Adjudication was filed resulting in an admission from defense counsel that our position was justified and that the client was not only entitled to recover medical and indemnity costs, but potentially also all attorney, case management, and administrative charges resulting in an award of a minimum of $253,337.82. 

The importance of understanding the contractual claims that certain clients may be able to utilize in addition to the standard negligence claims that emanate from a workers compensation loss was paramount to optimizing the client’s recovery well in excess of a typical negligence claim.  Refusing to allow any money to be left on the table, we were able to work with local counsel to maximize our client’s recovery for all their damages.

The analysis of the contractual claim centered around the language of the contract which stated:

INDEMNIFICATION. [Vendor] agrees to indemnify, defend and hold harmless [Client] and its affiliates and their respective officers, directors, employees and agents from and against, all claims, demands, damages, judgments, losses, penalties, liabilities, liens and expenses (including but not limited to costs of audit, investigation and settlement and attorneys’ fees and costs), incurred by any of them as a result of or relating to: (i) any personal injury or property damage caused, directly or indirectly, by [Vendor] or and of [Vendor’s] subcontractors or other agents; (ii) any act or omission by [Vendor] or any of [Vendor’s] subcontractors or other agents; and (iii) any breach of the representations, warranties or obligation contained in this Agreement.

Finding that one of the subcontractors of the vendor caused the loss, the Court granted our motion and we now wait for the resolution of the entire claim to enter judgment, assess ten percent interest under California law, and request fees of collection under the Agreement, which could increase the recovery by more than $100,000.00.