ISSUE: A Guest Post (Subrogation) and a GLOSSARY Update


Here is another contribution from Royce Ray, AEU’s Director of Subrogation.

NOTE: Royce is a Certified Subrogation Recovery Professional (CSRP).  The CSRP designation is conferred by the National Association of Subrogation Professionals (NASP) on individuals who possess substantial industry experience and pass a comprehensive examination on subrogation investigation, management and recovery.  Royce has been a CSRP since 2009, and he is an experienced personal injury attorney, having practiced law for approximately seventeen years prior to joining AEU in 2007 as Director of Subrogation.

Here’s Royce:

“Over the years I have been asked, “What is the number one thing that you would want an ALMA (American Longshore Mutual Association) member to know about subrogation?” It’s a great question, and my answer may surprise you.

I would say to actively look for third party involvement immediately after any incident. The most widespread problem that hampers identification of viable subrogation is the failure to search for third party involvement.  Often I review incident reports that do not address this.  If third party involvement is not actively explored during an investigation, viable subrogation will not be uncovered and indeed may be forever lost.  The result:  a lost opportunity to save money on your workers’ compensation insurance.

There is a fascinating psychology experiment known as The Invisible Gorilla (see  When you get a moment I encourage you to visit The Invisible Gorilla website.  In the now famous experiment subjects view players passing a basketball and are asked to count the number of times that the ball is passed.  A man dressed in a gorilla suit walks through the circle of players as they are passing the ball.  On average approximately fifty percent of the subjects report not seeing the gorilla, despite the fact that he appeared right before their eyes.

Several years ago I attended a national conference of subrogation professionals where one of the speakers compared identifying subrogation to not seeing the man in the gorilla suit. His observation is so true – if you do not deliberately look for subrogation, rest assured that much like the “invisible gorilla”, you will probably not find it.”

Thanks Royce.


Glossary Update

Several years ago I posted a discussion which began like this:

Have you noticed that conversations among lawyers who specialize in the Longshore Act frequently seem to consist of cryptic, single word references? The code word is usually a reference to a court case that stands for a principle of law that the lawyers are familiar with.  It is usually the name of the plaintiff in the case, but not always.

Here is a lengthy, but even so, incomplete, list of “Longshore” cases along with the shorthand version of the principle involved. Most of these are U.S. Supreme Court cases, but there are also a few cases from the federal Circuit Courts of Appeals.

There has been sufficient jurisprudence since this discussion to justify an update to include recent cases affecting the Longshore Act and extensions.

O’Leary – Not a new case, but it belongs on the list.  It established the Zone of Special Danger doctrine in cases arising under the Defense Base Act. (O’Leary v. Brown-Pacific-Maxon, Inc., 340 U.S. 504 (1951))

Valladolid – There is no situs of injury requirement in the Outer Continental Shelf Lands Act.  The test for coverage is that there must be “substantial nexus” between the injury and the employer’s extractive operations on the outer continental shelf. (132 S.Ct. 680 (2012))

Lozman – The current test for vessel status.  In the eyes of a reasonable observer the contrivance must be practically capable of serving as a means of transportation of people or things over water.  (133 S.Ct. 735 (2013))

Roberts – The maximum weekly compensation rate is applicable in a case when the claimant is “newly awarded compensation” as the phrase appears in section 6(c).  This is when he first becomes statutorily entitled to benefits no matter when, or whether, a compensation order is issued in his case.  (Dana Roberts v. Sealand Services, Inc.; Kemper Insurance Company; and Director, Office of Workers’ Compensation Programs, U.S. Department of Labor, 132 S.Ct. 1350 (2012)).

The Osceola – summarized the rights of seamen in the U.S. under the general maritime law (unseaworthiness and maintenance and cure, transportation and wages).  The confirmation of the absence of a negligence remedy against the seaman’s employer contributed to the passage of the “Jones Act” in 1920.  (The Osceola, 189 U.S. 158 (1903))

Jensen – the “Jensen Line” established the boundary of state workers’ compensation law jurisdiction at the edge of the navigable waters of the United States.  The gap in protection that it created for land based maritime workers led to the eventual passage of the Longshore Act in 1927. (Southern Pacific RR Company v. Jensen, 244 U.S. 205 (1917))

Davis – recognized the existence of a coverage “twilight zone” between the Longshore Act and state act workers’ compensation laws.  (Davis v. Department of Labor, 317 U.S. 249 (1942))

Cardillo – established the “last responsible employer” rule in occupational disease cases.  (Travelers Insurance Co. v. Cardillo, 225 F.2nd 137 (2nd Cir. 1955))

Caputo – repudiated the “moment of injury” test in Longshore cases.  If any part of a worker’s duties is maritime in nature then he is a full time Longshore worker.  (Northeast Marine Terminals v. Caputo, 432 U.S. 249 (1977))

Herron – Situs test for Longshore Act coverage in the Ninth Circuit (Washington, Oregon, Montana, Idaho, California, Nevada, Arizona, Alaska, and Hawaii).  (Brady-Hamilton Stevedore Co. v. Herron, 568 F.2nd 87 (9th Cir. 1978))

Ford – First landward stop for cargo is not the final step in unloading.  All intermediate steps are covered. P.C. Pfeiffer Co. v. Ford, 444 U.S. 69 (1979))

Winchester – Former situs test in the Fifth Circuit (Louisiana, Texas, and Mississippi).  (Textports Stevedore Co. v. Winchester, 632 F. 2nd 504 (5th Cir. 1980)) overruled by New Orleans Depot Services, Inc. v. Director, Office of Workers’ Compensation Programs (Zepeda), 718 F.3rd 384 (5th Cir. 2013)).  The Fifth Circuit now agrees with the Fourth Circuit that to be an “other adjoining area” for situs under the Longshore Act the situs must be contiguous with, or touching, navigable waters.

Sun Ship – The Longshore and Harbor Workers’ Compensation Act supplements state workers’ compensation laws, it does not supplant them.  This confirmed the principle of concurrent state and federal jurisdiction.  (Sun Ship, Inc. v. Commonwealth of Pennsylvania, 447 U.S. 715 (1980))

PEPCO – The Section 908(c) schedule is mandatory for injuries that fall within the schedule.  (Potomac Electric Power Co. v. Director, Office of Workers’ Compensation Programs, 449 U.S. 268 (1980))

Scindia – Established the vessel owner’s duties to longshore workers, one of reasonable care subject to the limitations as contained in the turnover duty, active control duty, and duty to intervene..  (Scindia Steam Navigation Co. Ltd. v. De Los Santos, 451 U.S. 156 (1981))

Perini – Situs over navigable waters confers status.  (Director, Office of Workers’ Compensation Programs v. Perini North River Associates (Churchill), 459 U.S. 297 (1983))

Herb’s Welding – Status case, work on fixed oil and gas platforms in state territorial waters is not maritime employment.  (Herb’s Welding v. Gray, 470 U.S. 414 (1985))

Schwalb – Status test, work must be “integral” or essential to the employer’s loading, unloading, shipbuilding, or ship repair activities.  (Chesapeake & Ohio Ry. Co. v. Schwalb, 493 U.S. 40 (1989))

Cowart – a claimant becomes a “person entitled to compensation” at the moment that the right to recovery vests whether or not he or she is actually receiving compensation.  (Estate of Cowart v. Nicklos Drilling Co., 505 U.S. 469 (1992))

Abbott – Claimant entitled to permanent total disability benefits during participation in DOL approved vocational rehabilitation plan.  (Louisiana Insurance Guaranty Association v. Abbott, 40 F. 3rd 122 (5th Cir. 1994))  Also see Castro in the Ninth Circuit.

Greenwich Collieries – There is no “true doubt rule” in Longshore cases.  The claimant is not entitled to judgment if the evidence is evenly balanced.  The proponent of a position bears the burden of proof by a preponderance of the evidence.  (Director, OWCP v. Greenwich Collieries, 512 U.S. 267 (1994)).  (See also Santoro v. Maher Terminals, Inc.)

Sidwell – Situs test in Fourth Circuit (Maryland, Virginia, West Virginia, North Carolina, and South Carolina).  (Sidwell v. Express Container Services, Inc. 71 F. 3rd 1134 (4th Cir. 1995))

Harcum – The Director, Office of Workers’ Compensation Programs, cannot initiate appeals to the federal Circuits (except for section 908(f) (second injury) issues).  The Director is not the designated champion of the claimant.  (Director, Office of Workers’ Compensation Programs v. Newport News Shipbuilding and Dry Dock Co. (Harcum), 514 U.S. 122 (1995))

Chandris – Test for seaman status.  (Chandris, Inc. v. Latsis, 515 U.S. 347 (1995))

Rambo – Even if there is no present loss of wage earning capacity a claimant may be awarded a de minimus award but there must be a significant possibility of future loss of earnings.  (Metropolitan Stevedores v. Director, Office of Workers’ Compensation Programs (Rambo II), 521 U.S. 121 (1997))

Price – Aggravation rule in traumatic injury cases.  (Metropolitan Stevedore Co. v. Crescent Wharf & Warehouse Co. (Price), 339 F. 3rd 1102 (9th Cir. 2002))

Stewart – Broad definition of a vessel includes “every description of watercraft or other contrivance used, or capable of being used, as a means of transportation on water” (Stewart v. Dutra Construction Co., 543 U.S. 481 (2005)).  This case has been superseded by Lozman’s new “reasonable observer” test for vessel status (see above).



John A. (Jack) Martone served for 27 years in the U.S. Department of Labor, Office of Workers Compensation Programs, as the Chief, Branch of Insurance, Financial Management, and Assessments and Acting Director, Division of Longshore and Harbor Workers’ Compensation.  Jack joined The American Equity Underwriters, Inc. (AEU) in 2006, where he serves as Senior Vice President, AEU Advisory Services and is the moderator of the AEU Longshore Blog.

ISSUE: Notes

Jack_crop 72dpiNOTE: Back on June 2, 2014, Royce Ray, AEU’s Director of Subrogation, posted a discussion with regard to the importance of photographs in support of subrogation efforts.

In my brief introduction to that piece, I mentioned that Royce was a CSRP (Certified Subrogation Recovery Professional). I don’t think that I did justice to the nature of this professional designation, or, for that matter, to the overall importance of subrogation to AEU’s operations. So I asked Royce to supplement. Here’s what he has to say:

“In my June 2, 2014, Blog on Photographs and Subrogation, Jack mentioned at the beginning of the article that I am a CSRP. But what is a CSRP, and what does it mean? Those are fair questions to ask when you are looking at the numerous advantages of being part of the ALMA program for your Longshore Act coverage.

A CSRP is a Certified Subrogation Recovery Professional. The CSRP designation is conferred by the National Association of Subrogation Professionals (NASP) on individuals who possess substantial industry experience and pass a comprehensive exam on subrogation investigation, management and recovery.

According to the NASP:

“The Certified Subrogation Recovery Professional (CSRP) designation is the professional designation for subrogation professionals. It is a statement that those possessing the designation have met stringent academic and experience requirements and have agreed to be bound by the Code of Professional Ethics of Certified Subrogation Recovery Professionals.”

I have been a CSRP since 2009. And, I am an experienced personal injury attorney, having practiced law for approximately 17 years prior to joining AEU in 2007 as the Director of Subrogation.

Having a dedicated Subrogation Unit headed by an attorney who is a CSRP is yet another reason why I feel as though AEU is the “go to” market for coverage under the Longshore Act.”

That’s better.

NOTE: John Chamberlain, who succeeded me at the U.S. Department of Labor and who is now doing business at, had an astute comment with regard to the current controversy in the state of Florida concerning the constitutionality of the state’s workers’ compensation law. As we know, the exclusions to Longshore Act coverage added by the 1984 amendment provisions of section 902(3)(A) – (F) contain a condition. To be excluded from Longshore Act coverage under these provisions the injured worker must be “subject to coverage under a State workers’ compensation law”. If Florida should find itself suddenly “between acts”, then all of the purportedly excluded workers would find themselves back under the Longshore Act because of the failure of the condition of state coverage. This also applies to the section 3(d) small vessel facility exemption.

Any employer in Florida who believes that they have employees who are excluded under the provisions of section 902(3)(A)-(F), or who have certified exempt as a small vessel facility should be watching developments very closely.


But at least I know that I’m not the only one who thinks that it’s fun to discuss “status” under the Longshore Act. Next time I’ll discuss two perennial “status” favorites: truck drivers and clerks.

NOTE: The U.S. Department of Labor (DOL) has closed its Baltimore district office. DOL announced Industry Notice No. 146 on August 25, 2014. The Longshore Baltimore district office will close on September 30, 2014. The former Fourth Compensation District will be consolidated with the Fifth Compensation District located in Norfolk, VA. As part of the transition, effective September 1 the Norfolk office has jurisdiction over past and future cases arising in Delaware, Maryland, Pennsylvania, Virginia, West Virginia and the District of Columbia. The physical address for the Norfolk office is: U.S. Department of Labor, Office of Workers’ Compensation Programs, Division of Longshore and Harbor Workers’ Compensation, Federal Building, Room 212, 200 Granby Mall, Norfolk, VA 23510. The telephone number is 757-441-3071.

In accordance with previous DOL instructions, centralized reporting of all new cases goes to the New York district office. After a case has been created, all mail should still be sent to the Jacksonville district office.

So Baltimore joins Philadelphia and Chicago as closed Longshore district offices.


Issue: Photographs and Subrogation

Royce sm head shotThis is a guest blog, provided by Royce Ray. Royce is the Director, Subrogation Recovery Unit, with The American Equity Underwriters, Inc. He is a Certified Subrogation Recovery Professional (CSRP), with over 20 years experience in the area of personal injury law. He is an expert.

Here’s Royce 

In my August 2010 Blog article, I emphasized the importance of an early investigation to successful subrogation. One element of such an investigation should be photographs (and plenty of them!). Indeed, photographs can add significant value to a third party claim and consequently, make a subrogation claim more valuable, which will save you money on your comp insurance.

When I think about the critical parts of a good investigation, the old adage “a picture is worth a thousand words” immediately comes to mind. Few things are more persuasive to a jury in an injury case than graphic depictions of what happened. It is one thing for a jury to hear a witness’ description of a scene or event. It is entirely different for a jury to see a picture. Which one do you think would be more persuasive, vivid color photographs or witness testimony?

The time to take plenty of photos is during the initial subrogation investigation. The incident scene will rapidly change as time passes. Consequently, the quicker that you can document with photographs the better.

You should take many pictures, even of items that you think are not important. Often things that appear unimportant during the initial incident investigation will be important later. Once that happens, if you do not have a photo of the item in controversy it is too late and you will be at a disadvantage. The best way to prevent that is to get photos showing lots of different perspectives, distances, heights, views, angles, close-ups, surfaces, and conditions. A yard stick, tape measure or other object can help demonstrate distances and relative sizes. If possible, you should get pictures of the employee’s injuries. If a product liability claim is possible, detailed pictures of the product and all of its components (including all labels) should be taken as well.

Video footage of the area being investigated must be strongly considered as video can be even more powerful at conveying information than pictures. Sometimes you will face circumstances where you need to take photographs or video but do not have time to retrieve a quality camera. Many cell phones and blackberries have decent cameras or video recorders. These applications will suffice in an emergency.

An important word of caution before taking videos, especially before using any device with audio recording capability: you should thoroughly familiarize yourself with any applicable Federal and state criminal laws that govern electronic eavesdropping (preferably you should consult with an attorney).

Be sure to create a log that details who took the photos, the date, time, and place that they were taken, a description of what each photo shows and why they were taken. This information will come in handy months or years later because as time passes you can demonstrate the intent of the photo without having to rely on memory. And, generally testimony from the person who took the photos is needed to lay the proper foundation for getting the photographs admitted into evidence for consideration by a jury.

It is a mistake to assume that taking a few pictures here and there is adequate. You can never have enough photographs. In the computer age, there is no reason not to have lots of good photographs, for taking, storing and organizing large numbers of quality digital photographs is inexpensive and easy.


Early Investigation is the Key to Successful Subrogation

Submitted by:  Royce Ray, JD, Certified Subrogation Recovery Professional

The single most important ingredient to uncovering subrogation is an early incident investigation. I cannot emphasize that enough. I have previously touched on the significance of conducting an early investigation, but it is so critical to identifying subrogation that it bears repeating.

What do I mean by “early?” Simply stated, now. Not in a few minutes. Not in a few hours. Not in a few days. Early means right now. No delays. Of course, there will be situations where summoning emergency medical care for an injured worker or taking steps to mitigate a hazardous situation to prevent further or additional injury will naturally take precedence over starting a subrogation investigation. But the minute that those types of issues under control, subrogation should be investigated.

Why delve into the possibility of subrogation so early? Several important reasons. First, witnesses disappear quickly. Witnesses who were working nearby disburse and, for whatever reason, are often never identified or located. Witnesses also frequently move, seek other employment and even die. Moreover, even if a witness is available for interview, their memory of the details surrounding an event can fade over time. Consequently, to get the best understanding of the facts all people with knowledge need to be immediately identified and interviewed.

The second reason for conducting an early investigation is to prevent important evidence from getting lost or discarded. An early investigation will identify any product, machinery or equipment that must be set aside and preserved. That is vital to successful subrogation because having no product almost always means that no product liability claim can be asserted.

Third, incident scenes rapidly change over time for a variety of reasons. Few things are more devastating to identifying subrogation as a spoiled or materially altered incident scene.

An early investigation will yield the best evidence and will maximize the chances of revealing a subrogation opportunity worth pursuit, which could result in substantial savings on an employer’s comp insurance premiums.

One way that AEU drives down claims costs for ALMA members is the money savings generated through subrogation.  Since 2003, AEU has saved ALMA members over 10 million dollars through subrogation recoveries and the reserve eliminations on claims with subrogation.