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ATTORNEYS FOR APPELLANT James P. Buchholz Larry L. Barnard Fort Wayne, Indiana

ATTORNEY FOR APPELLEE David C. Kolbe Warsaw, Indiana

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In the

Indiana Supreme Court
_________________________________ No. 93S02-0503-EX-97 DEPUY, INC., Appellant (Plaintiff below), v. ANTHONY FARMER, Appellee (Defendant below). _________________________________ Appeal from the Worker's Compensation Board, No. 139388 ________________________________ On Petition To Transfer from the Indiana Court of Appeals, No. 93A02-0404-EX-301 _________________________________ May 17, 2006 Boehm, Justice. An injured worker settled a civil suit against a co-employee for an intentional injury in the workplace. We hold that the settlement reached before worker's compensation benefits have been resolved does not bar the injured employee from pursuing worker's compensation for that injury, but if worker's compensation benefits are awarded, the employer is entitled to subrogation rights to prevent double recovery. Facts and Procedural History On September 1, 1994, as Anthony Farmer started to clock out at the end of his shift at DePuy Manufacturing, Inc., he brushed his time card against Wynn Swindel's side. In response,

Swindel, who weighed approximately 470 pounds, yelled at Farmer, pinned him against a machine, and bent him backwards over it. Farmer sustained severe injuries to his back, resulting in lost work, surgery, and medical bills. Farmer requested worker's compensation benefits in the amount of $58,556 in medical expenses, $3,312 for eight weeks temporary total disability, and $16,250 for twenty-five percent permanent impairment. He also filed a civil suit against Swindel for battery and DePuy for negligence. The trial court dismissed the civil claim against DePuy on the basis that the Worker's Compensation Act (WCA) barred a civil tort claim against Farmer's employer for injuries sustained in this workplace incident. DePuy also moved unsuccessfully to dismiss the worker's compensation claim as arising from "horseplay" not governed by the WCA. After Swindel paid Farmer $3,000 to settle the battery suit, DePuy renewed its motion to dismiss the worker's compensation claim, this time on the ground that it had not consented to the agreement between Farmer and Swindel. The Hearing Judge agreed that the Worker's Compensation Board lacked jurisdiction as a result of Farmer's "third-party settlement" with Swindel. The Board reversed the Hearing Judge but directed Farmer to remit the $3,000 settlement sum to DePuy as a condition to maintaining his worker's compensation claim. Worker's compensation applies to injuries incurred "by accident arising out of and in the course of" employment. The Hearing Judge found that Farmer's injuries met these requirements, and the Board affirmed, but a divided panel of the Court of Appeals reversed the Board. The Court of Appeals agreed with the Board that the civil settlement did not bar Farmer's worker's compensation claim, but held, with Judge Vaidik dissenting, that Farmer's injuries "although sustained in the course of his employment, [did] not arise out of his employment with DePuy." DePuy, Inc. v. Farmer, 815 N.E.2d 558, 565 (Ind. Ct. App. 2004). We granted transfer. DePuy, Inc. v. Farmer, 831 N.E.2d 740 (Ind. 2005). Standard of Review DePuy first argues that the Worker's Compensation Board erred when it affirmed the Hearing Judge's finding that Farmer's injuries arose out of his employment. To the extent this

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finding turns on disputed facts, "[o]n appeal, we review the decision of the Board, not to reweigh the evidence or judge the credibility of witnesses, but only to determine whether substantial evidence, together with any reasonable inferences that flow from such evidence, support the Board's findings and conclusions." Walker v. State, 694 N.E.2d 258, 266 (Ind. 1998). To the extent the issue involves a conclusion of law based on undisputed facts, it is reviewed de novo. Id. DePuy also argues that Farmer's settlement with Swindel in the civil suit bars his worker's compensation claim. The resolution of this issue involves a question of law which we review de novo. Id. I. Application of Worker's Compensation Act

The WCA provides "compensation for personal injury or death by accident arising out of and in the course of employment." Ind. Code

Download DePuy, Inc. v. Anthony Farmer.pdf

Indiana Law