Perrillo v. Picco & Presley
Cite as 2007 SOS 7172

Settling a Doctor's Payment for Work Done on a Workers Compensation Suit

A group of employees filed a lawsuit in 1996 on charges of injuries sustained in their workplace, Elk Hills Naval Petroleum Reserve No.1 resulting from Bechtel's toxic contamination of the worksite Fanska v. Bechtel Group (Super. Ct. S.F. City and County, 1996, No. 975205) (Bechtel suit)

The employees also brought up claims for Workers' Compensation. Meanwhile, some wives of the employees joined in the suit with claims for loss of consortium. Since the wives' case was not compensable through workers compensation, it was filed in the civil court.

Dr. Richard Perrillo, a neuropsychologist, was hired by the plaintiffs as an expert to help examine the employees for various symptoms connected with their complaints. An attorney for the plaintiffs told Dr. Perrillo that he would be doing some of the reports on workers' compensation aspect. However, he would be paid out of the civil suit settlement and that he would have a civil lien on the case.

Dr. Perrillo indicated that he was not interested in doing workers compensation case. Nevertheless, for protection's sake, he took out both a workers compensation lien and a civil lien.

Eventually, the workers' civil suit settled for $1.5 million. The attorneys offered Dr. Perrillo $53,000, out of the settlement for his work on behalf of the parties who were not eligible for workers' compensation. Dr. Perrillo rejected this offer. He insisted on being paid out of the settlement for work he did for all of the plaintiffs.

Meanwhile, Dr. Perrillo accepted payment on three cases wherein had filed workers compensation liens. He had also settled another case with the Workers' Compensation Appeals Board (WCAB).

Dr. Perrillo brought up charges against the plaintiffs' attorneys in the Superior Court of Los Angeles County (http://www.lasuperiorcourt.org/) . He claimed for damages on the amount of his liens excluding the cases he has already settled. The jury awarded him $307,000 in past economic losses for his unpaid bills.

The civil suit attorneys appealed from the judgment and the order awarding attorney fees. On the other hand, Dr. Perrillo filed a cross-appeal regarding the award of prejudgment interest and attorney fees.

The Second Appellate District, Division 1 of the Court of Appeal of the State of California reversed the judgment and order of the court with directions.

• Under the Workers' Compensation Act, the WCAB has exclusive jurisdiction over all proceedings for the recovery of compensation, or concerning any right or liability arising out of our incidental thereto. Labor Code Sec. 5300 (a)

  Such compensation includes medico legal expenses for the purpose of proving or disproving a contested claim. The board has exclusive jurisdiction over workers compensation medical liens, and is the only body that could consider a lien dispute between a doctor and an employee's attorney over medical legal services rendered in a workers compensation case.

• The Court of Appeal found that Dr. Perrillo's services were compensable solely within the workers' compensation system, regardless of his having a contract with the attorneys of being paid from the civil suit or whether his work helped the civil cases or not.


• All the same, payment of his medical legal expenses arose out of or was incidental to the employees' recovery of compensation under the workers compensation laws with exclusive jurisdiction by the WCAB.


• Reversing and remanding, the court of appeal ordered the civil judgment reduced according to the amount of the workers compensation award for Dr. Perrillo's services to the employees. This decision was filed on December 6, 2007.