COMMON FUND LITIGATION - GENERALLY

MONTANA SUPREME COURT DECISIONS

Ruhd v. Liberty Northwest Insurance Corporation v. Fisch, Frost, Rausch, 2004 MT 236. Attorneys who created common fund via litigation in Rausch v. State Compensation Insurance Fund, 2002 MT 203, were entitled to attorneys fees from all permanently totally disabled workers’ compensation beneficiaries in Montana who benefitted from the decision, not just those insured by defendant in Rausch (Montana State Fund). Attorney who brought separate action against different insurer (Liberty Northwest) on same legal argument made in Rausch was entitled to fees earned in his client’s case, but not from all those claimants insured by Liberty, because the work of the Rausch attorneys established the liability of all insurers to all “common fund” claimants. Workers’ Compensation Court must supervise enforcement of the common fund pursuant to Rausch, and all court-approved agreements stemming from it, from all insurers involved.

Dempsey v. Allstate Ins. Co. [12/30/04] 2004 MT 391 All civil decisions of the Montana Supreme Court apply retroactively to cases pending on direct review or not yet final (or settled), unless a party proves all three of the factors stated in Chevron v. Oil Co. v. Huson, 404 U.S. 97, 92 S.Ct. 349, 30 L.Ed.2d 296 (1971). Consistent with Harper v. Virginia Dep’t of Taxation, 509 U.S. 86, 113 S.Ct. 2510, 125 L.Ed.2d 74 (1993), the Montana Supreme Court finds that limiting a rule of law to its prospective application generally creates an arbitrary distinction between litigants based merely on the timing of their claims, though the Court reserves the possibility of prospective application per Chevron where all three Chevron factors apply. In other cases, when a decision issues, the line should be drawn between claims that are final and those that are not (the line drawn in Harper).
Murer v. State Compensation Ins. Fund, 283 Mont. 210, 942 P.2d 69 (1997)
(No. 95-542) When a party has an interest in a fund in common with others and incurs legal fees in order to establish, preserve, increase, or collect that fund, then that party is entitled to reimbursement of his or her reasonable attorney fees from the proceeds of the fund itself
Murer v. State Compensation Ins. Fund, 283 Mont. 210, 942 P.2d 69 (1997)
(No. 95-542) Application of the common fund doctrine is especially appropriate where the individual damage from an institutional wrong may not be sufficient from an economic viewpoint to justify the legal expense necessary to challenge that wrong.
Murer v. State Compensation Ins. Fund, 283 Mont. 210, 942 P.2d 69 (1997)
(No. 95-542) Where claimants engaged in lengthy and complex litigation to require insurer to increase benefit rates under correct statutory interpretation of ending point of benefit cap, their attorneys are entitled to common fund fees.
 
WORKERS' COMPENSATION COURT DECISIONS
Schmill v. Liberty Northwest Ins. Corp. [07/29/08] 2008 MTWCC 38 Where the Montana Supreme Court has already found a global common fund, the Workers’ Compensation Court is not empowered to dismiss responding insurers from this litigation, but must require their payment of benefits and fees pursuant to the decision.
Satterlee v. Lumberman's Mutual Ins. Co. [06/04/08] 2008 MTWCC 29 Where § 39-71-710, MCA, places a reasonable limitation on PTD benefits in order to contain the cost of the system for employers while ensuring that PTD claimants are compensated commensurately with the wages they were earning when they left the workforce for what otherwise would have been their remaining “work life”, the Court finds that the statute passes constitutional muster under a substantive due process challenge. Additionally, for the same reasons § 39-71-710, MCA, does not violate Petitioner’s right to equal protection, the statute does not unconstitutionally discriminate against Petitioners based on their age.
Reesor v. Montana State Fund [07/20/05] 2005 MTWCC 40 Since determination of the petitioner’s attorney to common fund fees depends on identification and payment of benefits, legal rulings affecting such identification and payment must be applied across the board irrespective of the insurer.
Flynn and Miller v. Montana State Fund and Liberty Northwest Ins. Corp. [11/05/04] 2004 MTWCC 75 The right of privacy extends only to information as to which an individual has a reasonable expectation of privacy as measured by societal expectations. Pengra v. State, 2000 MT 291, 302 Mont. 276, 14 P.3d 499; Jefferson County v. Montana Standard, 2003 MT 304, 318 Mont. 173, 79 P.3d 805. Claimants in workers' compensation cases do not have a reasonable expectation of privacy with respect to their identities and information pertaining to their entitlement to benefits, at least with respect to attorneys who have established their entitlement to further benefits under the common fund doctrine and where the attorneys are prohibited from disseminating information regarding their identities and claims to others.

Murer v. Montana State Compen. Ins. Fund [09/25/95] 1995 MTWCC 39A-2 Although the Workers’ Compensation Court denied attorneys’ request for common fund fees on benefits distributed to non-party claimants following decision in Murer et al. v. State Compensation Insurance Fund, 267 Mont. 516 (1994) (Murer II), the insurer was authorized to withhold attorneys fees from distribution to these claimants pending appeal. Otherwise, the insurer risked making full distribution to claimants, then being ordered to pay fees to attorneys without having withheld fee amounts.
Murer v. Montana State Compen. Ins. Fund [03/08/95] 1995 MTWCC 18 On remand from the Supreme Court in Murer v. Montana State Compensation Mutual Ins. Fund, 267 Mont. 516 (1994) (Murer II), attorneys for claimants asserted lien for attorneys fees on all additional benefits paid as a result of the precedent established in Murer II. The fees would be paid out of amounts otherwise payable to unnamed claimants. An attorney representing thirteen claimants affected by Murer II, but not named in that case, was granted leave to intervene in this proceeding.