Murray American Energy, Inc. v. Dustin J. Harshey

IN THE INTERMEDIATE COURT OF APPEALS OF WEST VIRGINIA

FILED
MURRAY AMERICAN ENERGY, INC., July 30, 2024
Employer Below, Petitioner ASHLEY N. DEEM, CHIEF DEPUTY CLERK
INTERMEDIATE COURT OF APPEALS
OF WEST VIRGINIA
v.) No. 24-ICA-73 (JCN: 2012027687)

DUSTIN J. HARSHEY,
Claimant Below, Respondent

MEMORANDUM DECISION

Petitioner Murray American Energy, Inc. (“Murray”) appeals the February 1, 2024,
order of the Workers’ Compensation Board of Review (“Board”). Respondent Dustin J.
Harshey filed a response.1 Murray did not reply. The issue on appeal is whether the Board
erred in reversing the claim administrator’s order, which denied Mr. Harshey’s application
for permanent total disability (“PTD”) benefits.

This Court has jurisdiction over this appeal pursuant to West Virginia Code § 51-
11-4 (2022). After considering the parties’ arguments, the record on appeal, and the
applicable law, this Court finds no substantial question of law and no prejudicial error. For
these reasons, a memorandum decision affirming the Board’s order is appropriate under
Rule 21 of the Rules of Appellate Procedure.

On January 20, 2012, Mr. Harshey sustained injuries to his right lower extremity,
left leg, head, ribs, spleen, left hip, and pelvis when he was struck by a ram car. Per the
physician’s section, it was reported that Mr. Harshey sustained multiple injuries as a direct
result of an occupational injury. The claim administrator issued an order dated March 9,
2012, which held the claim compensable for concussion with no loss of consciousness;
contusion of lung without open wound into thorax; traumatic pneumothorax, closed; and
fracture sacrum/coccyx, closed.

The claim administrator issued an order dated May 24, 2012, adding post-traumatic
stress disorder (“PTSD”) and major depression disorder as compensable conditions of the
claim. On April 26, 2013, the claim administrator issued an order adding tear of medial
cartilage or meniscus of knee and traumatic arthropathy of the lower leg as compensable

1
Murray is represented by Aimee M. Stern, Esq. Mr. Harshey is represented by
Robert F. Vaughan, Esq.

1
conditions of the claim. The claim administrator issued an order dated March 7, 2014,
which granted Mr. Harshey a 14% permanent partial disability (“PPD”) award for his
psychiatric diagnoses based upon the report of Kari-Beth Law, M.D. A Work Capacity
Evaluation dated July 8, 2014, indicated that Mr. Harshey’s functional limitations restrict
him to sheltered employment at a light physical demand level. The report found that Mr.
Harshey was non-feasible for competitive employment.

Lawson F. Bernstein, M.D., evaluated Mr. Harshey on September 5, 2014. Dr.
Bernstein assessed PTSD, moderate in severity, work-related, partially treated; pain
disorder associated with traumatic injury, moderate in severity, partially treated; mood
disorder due to multiple traumatic injuries including traumatic brain injury (“TBI”),
moderate in severity, partially treated; rule out sleep disorder due to obstructive sleep apnea
syndrome, and status post jaw reconstruction, trauma related. Dr. Bernstein opined that Mr.
Harshey was unable to pursue gainful employment at this time and that his overall
prospects for gainful employment in the future were minimal.

On November 10, 2015, the claim administrator issued an order granting Mr.
Harshey a 39% PPD award for his orthopedic injuries based upon the report of David L.
Soulsby, M.D. Mr. Harshey protested this order. On December 4, 2017, the claim
administrator issued a notice advising Mr. Harshey that per the Decision of Administrative
Law Judge dated November 15, 2017, he was being granted an additional 10% PPD award
for a total orthopedic award of 49%. On May 30, 2019, the Supreme Court of Appeals of
West Virginia affirmed the grant of the additional 10% PPD award. See Murray American
Energy, Inc. v. Harshey, No. 18-0676, 2019 WL 2406702 (W. Va. May 30, 3019)
(memorandum decision).

On June 18, 2019, Mr. Harshey filed an application for PTD benefits, alleging he
met the 50% permanent partial disability threshold to proceed with a permanent total
disability claim.2 In response, Mr. Harshey was referred to Marsha Bailey, M.D., to
determine whether Mr. Harshey met the 50% permanent partial disability threshold. In Dr.
Bailey’s August 11, 2020, evaluation, she assessed a right comminuted and displaced distal
femur fracture; a right comminuted and displaced midshaft tibia fracture and right
comminuted and displaced fibular fracture; a splenic laceration with a small to moderate
hemoperitoneum; a left posterior hip dislocation; multiple pelvic fractures including a left
comminuted pubic bone fracture, left comminuted sacral body fracture with extension into
and widening of his left SI joint and possible widening of his right SI joint as well as a
pelvic hematoma; multiple rib fractures, including right ribs four through seven and left

2
Murray contested the timeliness of filing of Mr. Harshey’s application for PTD.
The Supreme Court of Appeals of West Virginia concurred with the Board finding that the
application was timely filed. See Murray American Energy, Inc. v. Harshey, No. 20-0716,
2022 WL 4299577 (W. Va. Sept 19, 2022) (memorandum decision).
2
ribs five through seven as well as rib nine with a small left pneumothorax and a right
pulmonary contusion; fractures to his lumbar spine including right transverse process
fractures of L2 and L3 as well as a fracture of the spinous process of S1 with an injury to
his sacral plexus (spinal cord injury) that resulted in a left foot drop; and a right knee
moderate to large lipohemathrosis and comminuted and displaced tibial plateau fracture
with articular incongruity (possible extension into the joint space) with posttraumatic
arthropathy of his right knee as well as a torn right medial meniscus and torn right ACL.
Dr. Bailey opined that there was no medical evidence to support the compensable
diagnoses of concussion without loss of consciousness and TBI. Using the American
Medical Association’s Guides to the Evaluation of Permanent Impairment, (4th ed. 1993)
(“Guides”) and West Virginia Code of State Rules § 85-20 (“Rule 20”), Dr. Bailey opined
that Mr. Harshey had a total whole person impairment (“WPI”) of 36% due to the
compensable injury. Dr. Bailey opined that despite the significant impairment Mr. Harshey
was not permanently totally disabled.

On January 12, 2021, Mr. Harshey was evaluated by Timothy Thistlethwaite, M.D.,
a psychiatrist, on behalf of Murray. Dr. Thistlethwaite diagnosed Mr. Harshey with PTSD,
in partial remission; mild neurocognitive disorder due to TBI with behavioral disturbance;
personality disorder, unspecified; and somatoform disorder, not otherwise specified. Dr.
Thistlethwaite found that Mr. Harshey had reached maximum medical improvement for
his psychiatric conditions. Using Rule 20, Dr. Thistlethwaite opined that Mr. Harshey had
a 15% WPI due to his psychiatric related injuries.

Mr. Harshey underwent a Functional Capacity Evaluation on December 7, 2021.
The report indicated that Mr. Harshey did not demonstrate the ability to perform the
majority of the essential functions/physical demands of his previous occupations. The
report further indicated that he tested at the medium physical demand level of 20-40 pounds
on an occasional basis.

On December 29, 2021, Erin W. Saniga, M.Ed., CRC, LPC, completed a PTD
Rehabilitation Evaluation Supplemental Report. Based upon Mr. Harshey’s vocational
history, the general educational development of those positions, skills, and abilities
associated with those positions, and his physical capabilities, Ms. Saniga opined that a
transferable skills analysis resulted in the identification of 322 occupation matches. Ms.
Saniga conducted a labor market survey within Mr. Harshey’s region of residence and
opined that there were appropriate positions for which he would be considered qualified or
could become qualified upon completion of an on-the-job training program and/or short-
term training program designed to provide basic computer and typing skills. Ms. Saniga
opined that Mr. Harshey was not permanently totally disabled as a result of the
compensable injury.

3
On behalf of Murray, Dr. Bailey conducted a medical review and issued a report
dated May 24, 2022. After a review of the records, Dr. Bailey opined that Mr. Harshey was
not permanently totally disabled. Dr. Bailey opined that the total combined WPI of Mr.
Harshey’s orthopedic and neurologic injuries, 36% WPI, and psychiatric injuries, 15%
WPI, was 46%. Thus, Dr. Bailey opined that Mr. Harshey had not met the threshold for
PTD and recommended the denial of his Application for Permanent Total Disability
Benefits. On August 2, 2022, Murray issued an order denying a PTD award based on a
finding that Mr. Harshey was not permanently and totally disabled from returning to
gainful employment. 3 Mr. Harshey protested this order to the Board.

Daniel C. Baierl, MS, CLCP, ABVE-Fellow, completed a Vocational Assessment
of Mr. Harshey dated February 17, 2023. Mr. Baierl considered Mr. Harshey’s work
history, work environment, specific vocational preparation, general educational
development, and estimated functional capabilities as defined by the FCE performed on
December 7, 2021. Mr. Baierl opined that due to Mr. Harshey’s cognitive and
psychological barriers resulting from the compensable injury, it was not reasonable to
conclude that he could be successfully retrained. Mr. Baierl opined that Mr. Harshey was
permanently totally disabled and unable to engage in any type of substantial gainful activity
within a 75-mile radius of his home as a result of the compensable injury.

On February 1, 2024, the Board reversed Murray’s order which denied Mr.
Harshey’s application for PTD benefits and remanded the claim to the claim administrator
with instructions to issue new initial recommendations affording Mr. Harshey a 30-day
opportunity to respond in writing to the reviewing body, and thereafter, ordering Murray
to process the application in conformity with W. Va. Code § 23-4-6. The Board found that
the Murray improperly processed the claim. Murray now appeals the Board’s order.

Our standard of review is set forth in West Virginia Code § 23-5-12a(b) (2022), in
part, as follows:

The Intermediate Court of Appeals may affirm the order or decision of the
Workers’ Compensation Board of Review or remand the case for further
proceedings. It shall reverse, vacate, or modify the order or decision of the
Workers’ Compensation Board of Review, if the substantial rights of the
petitioner or petitioners have been prejudiced because the Board of Review’s
findings are:

3
The August 2, 2022, order references June 21, 2022, initial recommendations.
However, no June 21, 2022, initial recommendations were submitted to this Court.
Murray’s arguments suggest that Dr. Bailey issued initial recommendations on May 24,
2022, in the form of her record review, and that Dr. Bailey is Murray’s “reviewing body,”
as defined in West Virginia Code § 23-4-6(i) (2005).
4
(1) In violation of statutory provisions;
(2) In excess of the statutory authority or jurisdiction of the Board of Review;
(3) Made upon unlawful procedures;
(4) Affected by other error of law;
(5) Clearly wrong in view of the reliable, probative, and substantial evidence
on the whole record; or
(6) Arbitrary or capricious or characterized by abuse of discretion or clearly
unwarranted exercise of discretion.

Murray argues that the Board erred in finding that the application for PTD benefits
was improperly processed by Murray, as Mr. Harshey did not raise that argument, and as
such Mr. Harshey waived that argument. Murray further argues that the Board erred in
failing to issue a substantive ruling based upon the record before it, which clearly shows
that Mr. Harshey does not meet the requirements for an award of PTD benefits. Finally,
Murray argues that Dr. Bailey was acting as its PTD Review Board, and she received no
evidence from Mr. Harshey that would cause her to change her initial recommendations.4

West Virginia Code § 23-4-6(n)(1) (2005) provides:

[I]n order to be eligible to apply for an award of permanent total disability
benefits for all injuries incurred and all diseases, including occupational
pneumoconiosis, regardless of the date of last exposure . . . . a claimant: (A)
Must have been awarded the sum of fifty percent in prior permanent partial
disability awards; (B) must have suffered a single occupational injury or
disease which results in a finding by the commission that the claimant has
suffered a medical impairment of fifty percent; or (C) has sustained a thirty-
five percent statutory disability pursuant to the provisions of subdivision (f)
of this section.

West Virginia Code § 23-4-6(j)(5) requires that self-insured employers and private
carriers perform all the administrative and adjudicatory functions of the former Office of
Insurance Commissioner PTD Review Board as a “reviewing body” and to employ or
otherwise engage adequate resources, including medical professionals, to perform the
functions of the PTD Review Board.

Here, the Board found that Murray improperly processed this claim under West
Virginia Code § 23-4-6(j)(5). The Board noted that the record failed to demonstrate that
any final recommendations were submitted by any board and/or physician or that Mr.
Harshey was given a thirty-day opportunity to respond to any initial recommendations.

4
Dr. Bailey’s initial recommendations were not submitted to the Board as evidence.
5
Upon review, we find that the Board was not clearly wrong in finding that Murray
improperly processed this claim under West Virginia Code § 23-4-6(j)(5). As the Supreme
Court of Appeals of West Virginia has set forth, “[t]he ‘clearly wrong’ and the ‘arbitrary
and capricious’ standards of review are deferential ones which presume an agency’s actions
are valid as long as the decision is supported by substantial evidence or by a rational basis.”
Syl. Pt. 3, In re Queen, 196 W. Va. 442, 473 S.E.2d 483 (1996). With this deferential
standard of review in mind, we cannot conclude that the Board was clearly wrong in
reversing Murray’s order denying Mr. Harshey’s application for PTD benefits.
Additionally, we find no merit in Murray’s argument that the Board inappropriately made
a finding that it improperly processed the PTD application.

The instant case is similar to Consol of Kentucky, Inc. v. Bentley, No. 23-ICA-321,
2024 WL 1729985 (W. Va. Ct. App. April 22, 2024) (memorandum decision), in which
this Court found that the self-insured employer, in its capacity as a reviewing body, failed
to comply with West Virginia Code § 23-4-6(n)(1) and did not engage “adequate resources
including medical professionals to perform the evaluative and independent deliberative
functions” of the former PTD Review Board. This Court further found in Consol, that the
self-insured employer in its capacity as a reviewing body failed to comply with West
Virginia Code § 23-4-6(j)(5) by not providing an initial written recommendation together
with reasoning to the claimant for a 30-day review. Moreover, pursuant to Consol of
Kentucky, Dr. Bailey alone cannot constitute a reviewing body that issues initial and final
recommendations in adjudicating Mr. Harshey’s PTD claim.

Accordingly, we affirm the Board’s February 1, 2024, order.

Affirmed.

ISSUED: July 30, 2024

CONCURRED IN BY:

Chief Judge Thomas E. Scarr
Judge Charles O. Lorensen
Judge Daniel W. Greear

6