Applied Materials v. Workers' Comp. Appeals Bd.

APPLIED MATERIALS et al., Petitioners, v. WORKERS' COMPENSATION APPEALS BOARD and D.C., Respondents.

XL SPECIALTY INSURANCE CO., Petitioner, v. WORKERS' COMPENSATION APPEALS BOARD and D.C., Respondents.

H047148

H047154

COURT OF APPEAL OF THE STATE OF CALIFORNIA SIXTH APPELLATE DISTRICT

Certified for publication: June 1, 2021

May 7, 2021

(W.C.A.B. No. ADJ1351389)

(W.C.A.B. Nos. ADJ7168611, ADJ7183596)

I. INTRODUCTION

Respondent injured worker, D.C. (Worker),¹ was employed by petitioner Applied Materials from 1996 until 2008. During that time, she claimed three industrial injuries:a specific injury to her neck and right upper extremity in 2001, a specific injury to her neck and both upper extremities in 2005, and a cumulative trauma injury to her neck, both upper extremities, and psyche ending on her last day worked in January 2008. Worker claimed her injuries were due to the constant, repeated use of a computer keyboard and mouse at work. After the first injury in 2001, Worker returned to work on modified duty and continued to perform modified work—punctuated by periods of total temporary disability—until 2008. In 2006, Worker developed injuries to her psyche (a pain disorder due to her chronic pain, an anxiety disorder, and depression), which she claimed were industrial because they were compensable consequences of her physical injuries. Worker later claimed that in 2013, she was sexually exploited by Dr. John Massey, the physician primarily responsible for the treatment of her industrial injuries. She claimed that he touched her inappropriately on multiple occasions at his clinic and had sexual intercourse with her five times in her home. As a result of the doctor's alleged misconduct, Worker claimed that she suffered a further injury to her psyche and was diagnosed with posttraumatic stress disorder (PTSD). Worker claimed her PTSD was industrial as a compensable consequence of the medical treatment her employer provided for all three of her industrial injuries.

Arrowood Indemnity Company (Arrowood)—the workers' compensation carrier for the 2001 specific injury claim—accepted liability for Worker's 2001 physical injury claims, but disputed liability for her psychiatric injuries, including PTSD, on a variety of grounds. XL Specialty Insurance Company, as administered by Corvel Corporation (hereafter XL Specialty)—the workers' compensation carrier for both the 2005 specific injury and the 2008 cumulative trauma injury claims—denied liability for Worker's physical and psychiatric injuries, arguing among other things that Worker's injuries wereall due to the 2001 injury. Both insurers contended that Worker's psychiatric injury (PTSD) resulting from her claimed sexual exploitation by Dr. Massey was not industrial because it was the result of a consensual sexual relationship and occurred at her home.

The case went to trial before a workers' compensation judge (WCJ) in 2017. The WCJ found that all of Worker's injury claims—including her depression, anxiety, and PTSD—were industrial; ordered XL Specialty to pay two years' back temporary disability (TD); awarded Worker 100 percent permanent disability (sometimes PD) based on her PTSD alone retroactive to October 2010; found no apportionment; and concluded that the insurers were jointly and severally liable for the PD award since Dr. Massey treated all three of her industrial injuries. All parties (Applied Materials, Arrowood, XL Specialty, and Worker) petitioned the Workers' Compensation Appeals Board (WCAB) for reconsideration. The WCAB granted reconsideration. In its June 2019 decision, the WCAB amended the amount of the weekly TD and PD rates as recommended by the WCJ, made an order regarding attorney fees that is not at issue here, and otherwise affirmed the WCJ's findings and award.

Arrowood and XL Specialty filed separate petitions for review of the WCAB's decision.² We granted review in both cases and ordered the two petitions considered together for further briefing, oral argument, and disposition.

II. CONTENTIONS AND CONCLUSIONS ON WRIT REVIEW

(1) XL Specialty contends that the correct date of injury for the cumulative trauma claim was in March 2002 (during Arrowood's coverage) and that the WCAB erred in finding a cumulative trauma injury in 2008 (during XL Specialty's coverage).Reviewing the entire record, we conclude there was substantial evidence of repeated exposure to injury causing events and new injuries after 2005 that supported the WCAB's finding of cumulative trauma ending in 2008. We therefore reject XL Specialty's contention that the correct date of injury for the cumulative trauma was in 2002.

(2) Both petitioners challenge the WCAB's finding of industrial causation, arguing that the sexual activity between Worker and Dr. Massey was not medical treatment, was consensual, and broke the chain of industrial causation. We conclude that Worker met her burden of proving that her PTSD was a compensable consequence injury that resulted from the treatment for her industrial injuries and that her employment was one of the contributing causes without which her PTSD would not have occurred. We reject the contention that the sexual conduct here was consensual, since as a matter of law a patient cannot consent to sexual contact with his or her physician. (Bus. & Prof. Code, § 729, subd. (b).) We also reject Petitioners' contention that Worker's PTSD is not compensable under the rules governing industrial injuries arising out of assaults by third parties.

(3) We reject XL Specialty's contention that it is not liable for Worker's psychiatric disability since it did not authorize or pay for any of the treatment with Dr. Massey or his clinic. Substantial evidence supports the WCAB's conclusion that Dr. Massey treated Worker for all three injuries, including the injuries she sustained during XL Specialty's coverage period.

(4) We reject XL Specialty's challenges to the sufficiency of Dr. Steven Feinberg's agreed medical examiner (AME) reports to support the WCAB's finding of orthopedic injuries during XL Specialty's coverage period. Contrary to XL Specialty's assertions, the AME's evaluation included an extensive review of Worker's medical records and it was not necessary for the AME to reexamine Worker after 2011 to opine regarding industrial causation since her injuries predated 2008.

(5) We reject Arrowood's challenges to the sufficiency of the evidence to support the WCAB's findings of psychiatric injury due to the 2001 injury. We conclude that substantial evidence supported the WCAB's finding that Worker's PTSD was due in part to her 2001 injury since Dr. Massey treated Worker for all three injuries and Arrowood authorized and paid for the treatment.

(6) We reject Arrowood's challenge to the sufficiency of the evidence to support a finding of new and further disability within five years of the November 2001 injury. We conclude that there was substantial evidence of a new need for medical treatment, including psychiatric treatment, before November 2006 that supported the WCAB's implied finding of new and further disability from the November 2001 injury.

(7) We reject Arrowood's challenge to the sufficiency of the medical reports from Dr. Allan Sidle (the psychiatric qualified medical examiner (QME)) to support the PD award, which challenge is based on Arrowood's contention that the QME relied on the wrong PD rating schedule. Arrowood asserts that the 1997 Schedule for Rating Permanent Disabilities (1997 Schedule)³ applies to the 2001 injury, that the QME described Worker's PD in accordance with the 2005 Schedule for Rating Permanent Disabilities (2005 Schedule)⁴, and that he failed to describe Worker's disability in accordance with the 1997 Schedule. We will hold that in the circumstances in this case, the 2005 Schedule applies to the psychiatric PD claim.

(8) We conclude that the 100 percent PD award must be annulled because Dr. Sidle's reports that the WCAB relied on do not constitute substantial evidence since Dr. Sidle relied on an incorrect legal theory, the alternative path theory, that was subsequently rejected in Department of Corrections & Rehabilitation v. Workers' Comp.Appeals Bd. (2018) 27 Cal.App.5th 607 (Fitzpatrick). We also conclude that Worker's evidence was otherwise insufficient to rebut the scheduled rating for her psychiatric disability, which was 68 or 70 percent.

(9) Arrowood challenges the WCAB's finding of no apportionment on three grounds. It contends that Dr. Sidle's opinions are not substantial evidence because he (1) failed to apportion between the three industrial injuries and opined that the three injuries were inextricably intertwined; (2) failed to apportion to nonindustrial factors; and (3) failed to apportion to the pain disorder and depression that predated her PTSD diagnosis. Since we annul the PD award and remand for further proceedings, we do not address Arrowood's contentions, but we do review the rules governing apportionment for the guidance of the WCAB and parties on remand.

(10) Finally, we reject Arrowood's contentions that the WCAB ordered total PD benefits at the wrong weekly rate for the 2001 injury and that the WCAB erred in ordering it to administer the joint and several PD award. Since Arrowood failed to raise these issues in its petition for reconsideration to the WCAB, these points have been waived and are not cognizable in these proceedings.

In view of our conclusions, we will annul the award and remand to the WCAB for further proceedings consistent with our opinion.

III. FACTUAL AND PROCEDURAL HISTORY

A. History of Industrial Injuries, Medical Treatment, and Workers' Compensation Claims

Worker began working for Applied Materials in 1996 as an administrative assistant and was eventually promoted to program manager for marketing, communications, and international training programs. The history of her industrial injuries is complex, with three dates of injury, injuries to multiple body parts, numerousdiagnoses,...