The Boeing Company v. Carl Heidy and the Dept of Labor & Industries

In June 1995, Carl Heidy (Heidy) filed a claim for benefits with the
Department of Labor and Industries (Department) alleging he suffered from

occupational noise-related hearing loss (NRHL). The Department ordered
Heidy's former self-insured employer (SIE), The Boeing Company (Boeing), to
pay Heidy a permanent partial disability (PPD) award of 31.56 percent for
his hearing loss based on the schedule in effect when he retired. Boeing
appealed to the Board of Industrial Insurance Appeals (Board). William
McGraw (McGraw) filed a similar claim for benefits in November 1995. The
Department ordered McGraw's former employer, Boeing, to pay McGraw a PPD of
23.75 percent for his hearing loss. Boeing appealed to the Board.
Heidy and McGraw's claims were consolidated with seven other similar claims
before the Board for the purpose of taking testimony. The nine claims
shared certain facts: each claimant suffered NRHL and age-related hearing
loss (ARHL) (presbycusis); the Department ordered the respective SIE's to
pay a PPD award for 100 percent of the workers' hearing loss; and the
Department calculated the awards using the benefit schedule in effect on
the workers' last day of work. The SIE's argued in favor of segregating
ARHL from NRHL by using a median-based allocation method developed by Dr.
Robert Dobie.
The Board held the present methods of differentiating between ARHL and NRHL
were not scientifically reliable. The Board went on to state that, as a
matter of law, 'Washington . . . does not permit a reduction in a worker's
permanent partial disability benefits to account for aging's contribution
to hearing loss.' Heidy Certified Appeal Board R. (CABR) Clerk's Papers
(CP) at 29.1

The Board also rejected the Department's unwritten policy of categorically
rejecting audiograms conducted more than one year before a worker's
retirement.
However, it held that 'where the evidence shows a worker continued to be
placed in a noisy work environment after the date of a given audiogram . .
. the
burden appropriately shifts to the employer to show by persuasive evidence
that subsequent workplace noise was not injurious to the worker's hearing.'
Heidy CABR CP at 14.
In Heidy's case, the Board rejected an audiogram taken almost four and one-
half years after Heidy's retirement in favor of an audiogram taken almost
one and one-half years before Heidy retired. The Board rejected the
postretirement audiogram because it showed conductive hearing loss (which
is different from ARHL), whereas the preretirement audiograms showed NRHL.
In McGraw's case, the Board rejected an audiogram taken 13 months before
retirement in favor of an audiogram taken approximately eight years after
retirement. It did so because McGraw was exposed to 13 months of workplace
noise after the preretirement audiogram, and the additional hearing loss
was not inconsistent with NRHL. The Board concluded the incremental
increase in hearing loss between the preretirement and postretirement
audiograms (19 percent binaural impairment versus 23.75 percent binaural
impairment) was best accounted for by the 13 months of workplace exposure
to noise.

Finally, the Board held hearing loss becomes partially disabling when the
average loss exceeds 25 decibels across the frequencies specified in the
American Medical Association Guides. It also acknowledged that unlike most
other occupational diseases, a worker may be partially disabled by NRHL
without knowing of his or her condition. The Board found this anomaly
unacceptable and held, 'to ensure that the 'partially disabling' trigger to
start the schedule of benefits for occupational diseases be applied fairly
to all workers, . . . there be a showing that the worker also has
knowledge of limitations in his or her hearing.' Heidy CABR CP at 20.
This knowledge requirement had no effect in McGraw's case. In Heidy's
case, the Board declined to apply the schedule of benefits in effect in
1975, when an audiogram first showed Heidy was partially disabled.
Instead, it applied the schedule of benefits in effect on July 12, 1978,
when Heidy was first fitted with hearing aids. The schedule of benefits
was identical, regardless of which date applied. The cases were
deconsolidated and Boeing appealed each of the decisions to the superior
court with jurisdiction (King County in Heidy's case; Pierce County in
McGraw's case). The Department also appealed the decision in McGraw's
case.

The superior court in Heidy's case held that segregating ARHL from NRHL in
a PPD award is forbidden following the reasoning of Weyerhaeuser Co. v.
Tri, 117 Wn.2d 128, 814 P.2d 629 (1991). Having forbidden segregation as a
matter of law, the superior court did not address whether segregation was

medically possible. The court reversed the Board's burden-shifting rule
and knowledge requirement. It also awarded attorney fees to Heidy's
counsel.
The superior court in McGraw's case adopted every conclusion of law set
forth by the Board, except that involving when McGraw knew of his partial
disability. The court characterized that issue as moot. The court also
awarded attorney fees to McGraw's counsel, the same lawyer who represented
Heidy, and
applied a 1.25 multiplier to the lodestar amount. Boeing appealed the
segregation, burden-shifting and knowledge issues and the award of attorney
fees and the application of a 1.25 multiplier.2
Both Division One and Division Two of the Court of Appeals certified the
respective appeals to this Court on the grounds they involved 'a
fundamental and urgent issue of broad public import which requires prompt
and ultimate determination.' RAP 4.2(4). We accepted certification of
both cases and reconsolidated them for our review.
ANALYSIS
The Board held Washington law forbids segregation as a matter of law.
While the superior court in McGraw's case simply adopted the Board's
conclusion, the superior court in Heidy's case held segregation was
forbidden as a matter of law under Weyerhaeuser Co. v. Tri, 117 Wn.2d 128.

In Tri, we addressed the issue of apportioning worker's compensation risk
between successive employers or insurers. This case involves the different
issue of segregating an occupational disease from a nonoccupational
disease. Tri does not control the resolution of this case.
In support of their argument for segregating ARHL from NRHL, Boeing relies
on the testimony of Dr. Robert Dobie, who developed a statistical
methodology to segregate ARHL from NRHL. Although Dr. Dobie advocates
using several methods to allocate hearing loss to noise exposure or age,
the only
method at issue in this case is his median-based allocation method. The
median-based allocation method uses epidemiological data3 to segregate ARHL
from NRHL. Dr. Dobie explained it in simple terms:
{Y}ou basically look at the amount of {hearing} loss to be expected for
that individual, given his age, and look at the amount of loss to be
expected from what you know about the noise exposure {based on Databases A
and B}. {Y}ou then say, in my judgment, the fairest allocation is the one
that is in proportion to those two; that if a group of people working in 90
dBA for 40 years ended up having three quarters of their loss at age 60
being age-related and a quarter of it being noise induced, that that's a
proper division of responsibility for the individual who's 60 years old and
worked for 40 years in that noise exposure.

Dr. Dobie's testimony summarizes the flaw with the median-based allocation
method; it does not assist a doctor in determining the actual extent to
which an individual suffers from ARHL. At best, it allows a doctor to
compare an individual's age and hearing loss percentage to a smoothed-data4
chart based
on information not intended to be used to assess individuals. The doctor
can then 'norm' the individual's actual hearing loss percentage so that it
reflects the median amount of ARHL expected by a person of that age.
However, under the Industrial Insurance Act (Act), the amount of
compensation for a particular injury
focuses specifically on the injured individual and the extent of his or her
injuries.
Statistical studies showing tendencies within given age groups do not help
triers of fact determine the actual extent of workers' individual work-
related diseases.
Also, Act is to be 'liberally construed for the purpose of reducing to a
minimum the suffering and economic loss arising from injuries and/or death
occurring in the course of employment.' RCW 51.12.010. All doubts about
the meaning of the Act must be resolved in favor of workers. Clauson v.
Dep't of Labor & Indus., 130 Wn.2d 580, 584, 925 P.2d 624 (1996). When
faced with a circumstance where either workers or employers will bear the
burden of an imperfect science, the statute directs us to construe the Act
in favor of workers. RCW 51.12.010. Because of its generalized nature,
Boeing's median-based allocation method is inconsistent with the nature of
workers'

compensation in Washington, which focuses on the specific and individual
employment-related injuries and diseases of workers.
Boeing has not cited, nor can we find, statutory authority to support the
proposition that a disabled worker's PPD award can be reduced based simply
on the age of the worker. While employers are not required to compensate
workers' nonwork-related diseases and injuries, the fact a worker is a
certain age is irrelevant to establishing that any portion of his or her
injury or disease is not work-related. If it is determined that a worker's
disability is work-related and the employer can establish, on an
individualized basis, that the full amount or a portion of a worker's
disability is not work-related, the employer need not compensate that
worker for the portion of the worker's disease or injury that is not work-
related. However, the statutes do not allow an employer to establish that
a worker's disease or injury is not work-related simply by arguing the
worker is of a certain age and then showing that people of that age
generally suffer from the same or a similar disease. We find nothing in
the statutes that allows for a reduction based on age in an injured
worker's claim. Absent statutory authority to the contrary, we hold that a
worker's age is irrelevant to establishing the existence and extent of a
worker's disability, and the median-based allocation method cannot be used
to refute the existence or extent of an individual's disability.
Burden shifting

The next question is whether the superior court in McGraw's case erred
by requiring employers to establish the validity of an audiogram if a
preretirement

audiogram is used to measure hearing loss. The Department urges us to
reach beyond the facts of this case and forbid the use of industrial (as
opposed to clinical) audiograms to establish a worker's hearing loss.
The audiogram results used in these cases are evidence. Thus, this issue
concerns the weight and credibility accorded to evidence. An audiogram
conducted one year before a worker's retirement might be less credible than
an audiogram conducted one year after a worker's retirement. It might not
be. It might be more credible than an audiogram conducted 10 years after
retirement. It might not be. These are fact-based issues that go to the
weight and credibility of evidence.
Appellate courts do not weigh evidence or assess credibility. It is the
sole province of the trier of fact to pass on the weight and credibility of
evidence.
Davis v. Dep't of Labor & Indus., 94 Wn.2d 119, 124, 615 P.2d 1279 (1980)
(questions of credibility are for trier of fact and are not overturned on
appeal); State v. Walton, 64 Wn. App. 410, 415-16, 824 P.2d 533 (1992)
(trier of fact's
function is to weigh persuasiveness of evidence). The superior court is an
appellate court in appeals from the Board. Shufeldt v. Dep't of Labor &
Indus., 57 Wn.2d 758, 359 P.2d 495 (1961). As such, it is bound by the
same constraints as apply to all appellate courts. The superior court in
McGraw's case erred by requiring employers to establish the validity of an
audiogram if a preretirement audiogram is used to measure hearing loss. It
was improper for the superior court to impinge on the role of the trier of
fact by shifting the burden of

proof to employers to show no further injurious noise exposure if a
preretirement audiogram is used. Whether a preretirement audiogram
credibly measures a worker's hearing loss is for the trier of fact, not an
appellate court, to determine, and there has been no showing that
preretirement audiograms are so unreliable as to warrant a legal
presumption against their validity. As to the Department's
position, we decline to make the same mistake by creating another blanket
evidentiary rule. We have always relied on triers of fact to resolve these
issues, and we will continue to do so. The superior court is reversed on
this point, and the parties are free to litigate the validity of the
audiograms in the same manner they would litigate any other issue of fact
or credibility.
Knowledge requirement
The last substantive issue in this case is whether a worker must know he or
she is partially disabled before the applicable schedule of benefits can be
determined. The Board held, 'to ensure that the 'partially disabling'
trigger to start the schedule of benefits for occupational diseases be
applied fairly to all workers, . . . there must be a showing that the
worker knows of limitations in his or her hearing.' Heidy CABR CP at 20.
The superior court in Heidy's case
rejected this construction, and in McGraw's case, the court declined to
address the issue, believing it to be moot.
RCW 51.32.180(b) does not require such knowledge: '{T}he rate of
compensation for occupational diseases shall be established as of the date
the disease requires medical treatment or becomes totally or partially
disabling,

whichever occurs first, and without regard to the date of the contraction
of the disease or the date of filing the claim.' The Board expressed
disbelief that the term 'partially disabling' could 'treat workers
differently based solely on the nature of the medical condition they may
have.' Heidy CABR CP at 20. Nonetheless, that is exactly what the term
'partially disabling' does when applied to workers afflicted by a
progressive condition with easy to miss symptoms. RCW 51.32.180(b) is
clear--a worker's knowledge of his or her
disabling condition does not affect when the rate of compensation is
established. Rather, the rate of compensation is established when 'the
disease requires medical treatment or becomes totally or partially
disabling, whichever occurs first.' RCW 51.32.080(b); Dep't of Labor &
Indus. v. Landon, 117 Wn.2d
122, 124, 814 P.2d 626 (1991). Apart from the unique circumstances posed
by hearing loss, as a general proposition the date a worker is partially
disabled is usually the same date a worker knows of his or her disabling
disease. We hold a worker's knowledge of his or her disabling condition
does not affect when the rate of compensation under the Act is established.
Attorney fees
Finally, Boeing raises three challenges to the award of attorney fees in
Heidy's case and further argues it is entitled to statutory attorney fees
under RCW 4.84.010 as a prevailing party.
Boeing first argues Heidy's right to relief was not sustained on appeal.

Boeing acknowledges the absence of controlling law, but argues its case is
analogous to Brand v. Department of Labor & Industries, 139 Wn.2d 659, 989
P.2d 1111 (1999). In Brand, we held a claimant appellant need not prevail
on all issues to be entitled to attorney fees. Brand, 139 Wn.2d at 669-70.
Boeing argues it should not have to prevail on all issues in order not to
be responsible for attorney fees. It goes on to argue that since it
prevailed on two out of three issues on appeal, it is itself entitled to
statutory attorney fees. Boeing also argues in favor of segregating
Heidy's successful claims from unsuccessful claims and awarding attorney
fees only for the successful claims.
The plain language of RCW 51.52.130 answers Boeing's first contention:
'{I}n cases where a party other than the worker or beneficiary is the
appealing
party and the worker's or beneficiary's right to relief is sustained, a
reasonable fee for the services of the worker's or beneficiary's attorney
shall be fixed by the court.' Though he lost on two out of three issues,
Heidy's right to relief was
sustained throughout this litigation.5 RCW 51.52.130 is unambiguous, and
the statute requires Boeing to pay Heidy's reasonable attorney fees.
As to Boeing's analogy to Brand, we have already said that '{g}iven the
unitary nature of claims brought under the Industrial Insurance Act, . . .
workers' compensation claims are not unrelated, and should not be
segregated in terms of successful and unsuccessful claims for the purpose
of calculating

attorney fees under RCW 51.52.130.' Brand, 139 Wn.2d at 673.6
Furthermore, despite having prevailed on two out of the three issues it
appealed to superior court, Boeing did not prevail on the central issue in
this case--the only issue it appealed to the Board--whether it can use a
median-based allocation method to reduce a worker's hearing loss PPD award
to compensate for ARHL. Boeing was not a prevailing party within the
meaning of RCW 4.84.010.

Finally, Boeing argues Heidy's attorney fees were unreasonable. We
review the reasonableness of attorney fees under the abuse of discretion
standard.
Brand, 139 Wn.2d at 665. A trial court abuses its discretion only when the
exercise of its discretion is manifestly unreasonable or based upon
untenable
grounds or reasons. Brand, 139 Wn.2d at 665. The trial court awarded Heidy
$23,440 in attorney fees. Heidy's attorney did not begin representing
Heidy until Boeing appealed the Board's decision. He did, however,
represent one of the claimants in the consolidated cases before the Board.
Boeing argues the attorney
fees should be reduced in Heidy's case because Heidy's attorney was
familiar with the issues on appeal. Whether this is so or not is a matter
clearly within the
trial court's discretion. Boeing raised this same argument before the
trial court, which issued a memorandum opinion regarding attorney fees.
The trial court declined to apply a multiplier to the adjusted lodestar
amount because Heidy's attorney had already been involved in similar cases.
This is a matter within the trial court's discretion, and the trial court's
award of attorney fees was not manifestly unreasonable.

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