# U ni te d S ta te s Co ur t of A pp ea ls

For the Eig hth Circu it

__ __ __ __ __ __ __ __ __ __ __ __ __ _

No. 1 2- 40 48

__ __ __ __ __ __ __ __ __ __ __ __ __ _

Dou gl as Sp en cer,

ll ll ll ll ll ll ll ll ll ll l Pla in ti

ff - App el la nt

,

v.

Ann et t Ho ld in gs , Inc

.,

ll ll ll ll ll ll ll ll ll ll l Defe nd

an t - Ap pe ll ee

.

__ __ __ __ __ __ __ __ __ __ __ __ __ _

No. 1 3- 11 33

__ __ __ __ __ __ __ __ __ __ __ __ __ _

Dou gl as Sp en cer,

ll ll ll ll ll ll ll ll ll ll l Pla in ti

ff - App el le e ,

v.

Ann et t Ho ld in gs , Inc

.,

ll ll ll ll ll ll ll ll ll ll l Defe nd

an t - Ap pe ll an t

.

__ __ __ __ __ __
App eal fro m

Uni te d S ta te s Di st ric t Co ur t fo r th e So ut he rn Dis tri ct of I owa - Des M oi ne s

__ __ __ __ __ __

Su bm it te d: Nov em

be r 19 , 20 13
Fil ed : J ul y

8, 2 01 4

__ __ __ __ __ __Befo re WOL LMAN, COLLOTON , and GRUENDER, Circu it Ju dg es

.

__ __ __ __ __ __

COLLOTON, Ci rcu it Ju dg e.

Dou gl as Sp en cer, a fo rm er em pl oyee of Ann et t H o l d i ng s, In c., su ed Ann et t,

cl ai m in g th at th e co m

pa ny acted in ba d fa it h wh en it fai le d to pr ov id e m ed ic al care

an d refu se d to pa y hi m he al in g- pe rio d be ne fit s. Ann et t co un te rcl ai m ed fo r frau d,

al le gi ng th at Sp en cer fal se ly cl ai m ed th at hi s in jury was wor k- rel at ed whe n it res ul te d

fro m a fal l at hi s ho m e. On cro ss -m ot io ns fo r su m m ary jud gm en t, th e di st ric t co ur t 1

co nc lu de d th at ne it he r pa rty ha d pr es en te d a su bm is si bl e cas e fo r tri al an d di sm is se d

th e act io n. We affi rm

.

I.

Sp en cer was a tru ck er fo r Ann et t in Ja nu ary 20 07 whe n he rep or te d to Ann et t

th at he su ffer ed a wor k- rel at ed kn ee i nju ry aft er s li pp in g o ff t he ba ck of hi s fla tb ed

t r a i l e r. Sp en cer cl ai m ed a wor k in jury th at wou ld be co m

pe ns ab le un de r Io w a ’s

wor ke rs ’ co m

pe ns at io n la ws, so Ann et t was “ ob li ge d to fu rn is h reas on ab le se rv ic es

an d su pp li es to tre at ” Sp en cer, an d An n e tt ha d “ th e rig ht to ch oo se th e care ” th at it

was ob li ge d to pr ov id e. Io wa Co de § 85 .27 (4 ). In ot he r wor ds

, Ann et t ha d th e rig ht

to de te rm in e whi ch ph y si ci an s an d ot he r pr of es si on al s wou ld pr ov id e Sp en cer’s care

. Se e Pet ri ll o v . Lumb er men s Mu t. Ca s. Co

. , 37 8 F .3d 76 7, 7 69 (8t h C ir. 2 00 4)

.

Ann et t au th or iz ed Sp en cer to se e a ph y si ci an ne ar hi s ho m e in Ten ne ss ee. The
ph y si ci an to ld Ann et t th at Sp en cer sh ou ld be pl aced on li gh t du ty wor k, an d Ann et t

of fere d Sp en cer th at type of wor k in Des Mo in es

. Sp en cer acce pt e d th e of fer an d

The Hon or ab le Ro be rt W

. Prat t, Uni te d St at es Dis tri ct Ju dg e fo r th e So ut he rn 1

Dis tri ct of I owa

.

-2

-as su m ed li gh t du ty wor k for ab ou t a week

. Ann et t th en au th or iz ed Sp en cer to se e a

ne w ph y si ci an in Des M oi ne s, and th e ne w ph y si ci an co nc lu de d th at Sp en cer cou ld

res um e h is no rm al du ti es

.

Sp en ce r r e t u r ne d to fu ll du ty. Afte r ab ou t two m on th s, wit ho ut se ek in g

ap pr ov al fro m Ann et t fo r an y fu rth er care , he vi si te d hi s fam il y do ct or fo r tre at m en t

of kn ee pa in

. The fam il y do ct or or de red an MRI ex am in at i on

. Sp en cer, ag ai n
wit ho ut Ann et t’s ap pr ov al

, at te nd ed an ot he r ap po in tm en t wit h an or th op aed ic

su rg eo n. The su rg eo n di ag no se d Sp en cer wit h a m en is cu s te ar in hi s kn ee an d op in ed

th at su rg ery was ne ces sa ry

. The su rg eo n al so pr ov id ed Sp en cer wit h a “ wor k st at us ”

fo rm th at sa id Sp en cer req ui red kn ee su rg ery an d sh ou ld p e r f o r m no wor k “ un ti l

fu rth er n ot ic e.”

App aren tl y

wit ho ut no ti fy in g Ann et t th at he de si red su rg ery or pr ov id in g th e

co m pa ny wit h th e “ wor k st at us ” fo rm , Sp en cer ret ai ne d an at to rn ey in Te n n e s se e.
The at to rn ey no ti fie d Ann et t th at Sp en cer was el ect in g to pr oc eed un de r th e la ws of

Ten ne ss ee, whi ch —ac co rd in g to Sp en cer’s la wy er— m ean t th at Sp en cer co ul d m ak e

hi s own he al th care arra ng em en ts (in cl ud in g su rg ery), an d th en se ek rei m bu rs em en t

fro m Ann et t. On May 8, 20 07

, Ann et t res po nd ed th at Io wa la w go ve rn ed Sp en cer’s

care , be cau se Sp en cer ha d si gn ed an ag reem en t to th at effe ct

, an d no te d th at Io wa la w

pe rm it s an em

pl oyer to di rect an em

pl oyee’s care if th e e mp l o ye r i s pa y in g fo r th e

care

. Ann et t req ue st ed th at Sp en cer ret ur n to Des Mo in es fo r an in de pe nd en t m ed ic al

ex am in at io n by th e Io wa ph y si ci an who m Sp en cer h a d se en pr ev io us ly, so th at ph y si ci an co ul d d et erm in e whe th er s ur ge ry was n eces sa ry

.

Sp en cer refu se d to at te nd th e ex am in at io n in Des Mo in es , an d hi s at to rn ey to ld

Ann et t th at Sp en cer wou ld po st po ne th e su rg ery whi le Sp en cer so ug ht an or de r fro m

t he Ten ne ss ee Dep art m en t of Lab or th at Ten ne ss ee was th e ap pr op ria te fo ru m fo r Sp en cer’s cl ai m. Th e Ten ne ss ee ag en cy , h owe ve r, de ci de d in Ju ne 20 07 th at Io wa

was th e pr op er ve nu e fo r Sp en cer ’s wor ke rs ’ co m pe ns at io n cl ai m

. Ove r a m on th

-3

-la te r, Sp en cer’s ne wly ret ai ne d Io wa at to rn ey co nt act ed Ann et t, se ek in g co pi es of it s

reco rd s rela ti ng to Sp en cer. Th en , in a le tt er ab ou t t wo weeks aft er tha t, on Aug us t
9, Sp en cer’s Io wa at to rn ey req ue st ed th at Ann et t au t h o r i z e kn ee su rg ery. Ann et t

res po nd ed a week la te r, as ki ng fo r “ so m e ad di ti on al ti m e to in ve st ig at e th e ne ed fo r

su rg ery. ”

Und er Io wa la w, an em

pl oyee who is di ss at i sf

ie d wit h th e reas on ab le ne ss of

care pr of fere d by an em

pl oyer who acce pt s li ab il it y fo r th e wor k in jury m ay pe ti ti on

th e Io wa wor ke rs ’ co m

pe ns at io n co m

m is si on er fo r an or de r tha t pe rm it s th e em pl oyee

to ob ta in care th at th e em pl oyer de cl in es to au th or iz e. Se e Io wa Co de § 85 .27 (4 ).
Sp en cer fil ed two di ffer en t pe ti ti on s fo r al te rn at e care wit h th e co m m is si on er be fo re Sep te m be r 19

, se ek in g a ru li ng th at Ann et t was req ui red to au th or iz e su rg ery. Ann et t

ul ti m at el y of

fere d to au th or iz e su rg ery i f Sp en cer wou ld “ rep res en t th at th e on ly

kn own in jury t o h i s l eft kn ee” was th e cl ai m ed in jury in Ja nu ary, an d Sp en cer so

rep res en te d. Sp en cer’s s ur ge on pe rfo rm ed au th or iz ed kn ee s ur ge ry on Octo be r 5.

Afte r th e su rg ery, in Nov em be r 20 07

, Sp en cer fil ed a wor ke rs ’ co m pe ns at io n
arb it rat io n pe ti ti on , se ek in g to req ui re Ann et t to pr ov id e m ed ic al care fo r in juri es to

hi s le ft fo ot an d ha nd s an d fu rth er tre at m en t fo r hi s kn ee. Ann et t qu es ti on ed whe th er

th es e in juri es were rel at ed to th e in it ia l in jury fro m Ja n u a r y 2 0 0 7

. Sp en cer al so

req ue st ed he al in g- p e rio d be ne fit s fro m Ann et t fo r th e pe rio d be fo re hi s su rg ery. Sp en cer an d A nne tt ev en tua lly re ac hed a se tt le m en t ag reem en t, wit h Ann et t ad m it ti ng

li ab il it y fo r Sp en cer’s kn ee in jury an d ag reei ng to pa y he al in g- pe rio d be ne fit s an d al l

m ed ic al bi ll s re la te d t o t he kn ee i nju ry

.

In Ju ly 20 09

, ho wev er, Sp en cer fil ed an act i o n i n Io wa st at e co ur t ag ai ns t

Ann et t, al le gi ng th at th e co m pa ny ha d de ni ed hi m m ed ic al care an d de la y ed pa y m en t

of be ne f i t s i n b a d fai th

. The ne xt m on th

, Ann et t rece iv ed a ph on e cal l fro m a

ne ig hb or an d fr ie nd of S pe nc er’s wif e. The n ei gh bo r cl ai m ed th at Sp en cer was no t

in jure d in a fal l o ff his tru ck whi le wor ki ng fo r Ann et t, as Spen cer had rep res en te d,

-4

-bu t rat he r ha d sl ip pe d whi le at te nd in g to pe rs on al bu si ne ss in si de a wor ks ho p at hi s

ho m e. Acco rd in g to th e ne ig hb or , Sp en cer and hi s wife had br ag ge d th at th ey were

ge tt in g Ann et t to pa y fo r hi s kn ee su rg ery. Ove r se ve n m on th s la te r, Ann et t’s

at to rn ey to ok a reco rd ed st at em en t fro m t h e ne ig hb or

. Ano th er se ve n m on th s aft er

th at

, in Octo be r 20 10

, th e ne ig hb or si gn ed an d no ta riz ed th e tra ns cri pt of he r reco rd ed

st at em en t fo r Ann et t, two m on th s aft er sh e fai le d to res po nd to a su bp oe na in Aug us t

20 10

.

In th e m ean ti m e, in earl y 20 10 , S pe nc er’s su rg eo n r e t i r e d an d reco m m en de d

an ot he r do ct or to hi m

. Ann et t refu se d to au th or iz e an d pa y f o r S p e n c e r t o se e th e

reco m m en de d do ct or a n d s e n t h im to a di ffer en t ph y si ci an

. In May 20 10

, Sp en cer

fil ed a pe ti ti on fo r al te rn at e med ic al care wit h th e Io wa wor ke rs ’ co m pe ns at io n

co m m is si on er, se ek in g an au th or iz at io n th at wou ld req ui re Ann et t to pa y fo r hi s care by th e reco m

m en de d do ct or

. Ann et t re s p o n d e d to th e cl ai m in Ju ne 20 10

. The

co m m is si on de ni ed Sp en cer’s pe ti ti on , an d th e Io wa co ur ts up he ld th e de ni al on jud ic ia l re vi ew th at co nc lu de d i n 2 01 2.

In Sep te m

be r 20 10

, Ann et t fil ed co un te rcl ai m s in Sp en cer ’s Ju ly 20 09 Io wa

st at e co ur t act io n, in whi ch Sp en cer ha d al le ge d ba d- fai th de ni al of m ed ic al care an d

de la y of pa y m en ts

. Ann e tt br ou gh t co un te rcl ai m s fo r frau du le nt m is rep res en ta ti on

an d un jus t en ric hm en t ag ai ns t Sp en cer ba se d on th e in fo rm at io n it ha d le arn ed fro m Sp en cer’s ne ig hb or

. In th e m on th s th at f o l l o w e d, Ann et t refu se d to au th or iz e an y

m or e m ed ic al tre at m en t fo r Sp en cer, cl ai m in g th at he ha d no t su ffer ed a wor k in jury.

In Ju ly 2 01 1, Sp en cer vo lu nt ari ly d i s mi s s e d hi s st at e co ur t act io n. He br ou gh t th is

fed eral act io n ag ai ns t Ann et t in Decem be r 20 11

, ba se d o n di ve rs it y juri sd ic ti on , al le gi ng es se nt ia ll y th e sa m e st at e-l aw cl ai m s th at were al le ge d in th e pr ev io us st at e

co ur t ac ti on . Ann et t ag ai n c ou nt ercl ai m ed

.

The di st ric t co ur t gr an te d su mm a r y jud gm en t fo r Ann et t on al l of Sp en cer’s

cl ai m s. The co ur t de te rm in ed th at it co ul d no t co ns id er th e cl ai m fo r ba d- fai th fai lu re

-5

-t o pr ov id e m ed ic al care , be cau se Sp en cer ha d no t ex ha us te d hi s ad m in is tra ti ve

rem ed ie s as requ ire d by Io wa la w. The di st ric t cou rt rul ed al te rn at iv el y th at ev en if

th e cl ai m were av ai la bl e, al l of Sp en cer’s ba d- fai th cl ai m s fai le d be cau se Ann et t ha d

a reas on ab le ba si s t o de ny Sp en cer’s cl ai m s. On Ann et t’s co un te rcl ai m s, th e co ur t

ru le d th at by pa rti ci pa ti ng in Sp en cer’s Ju ne 20 10 pe ti ti on fo r al te rn at e m ed ic al care , Ann et t ad m it te d li ab il it y fo r Sp en cer’s in jury an d th at Sp en cer was en ti tl ed to

su m m ary jud gm en t b as ed on th e d oc tri ne of ju di ci al est op pe l.

Sp en cer ap pe al s th e d i s mi ss al of hi s cl ai m s fo r ba d- fai th fai lu re to pr ov id e

m ed ic al care an d to pa y he al in g- pe rio d ben efi ts ; Ann et t cros s- ap pe al s th e di sm is sa l

of it s co un te rcl ai m

. W e rev ie w th e di st ric t co ur t’s gr an t of su m m a r y ju d g men t de

no vo , vi ewin g th e reco rd in th e l i g h t m os t fav or ab le to th e no nm ov in g pa rty an d

dr awin g a ll reas on ab le in fere nc es in th at pa rty’ s fa vo r. And er so n v . Lib er ty Lo bb

y,

In c. , 47 7 U.S. 24 2, 25 5 (1 98 6)

. Sp en cer’s st at e-l aw cl ai m s in th is di ve rs it y act io n are

go ve rn ed by th e su bs ta nt iv e la w of Io wa. Kr ame r v. Ca sh Li nk Sy s. , 71 5 F.3 d 10 82

, 10 86 (8t h C ir. 2 01 3)

.

II.

A.

Und er Io wa wor ke rs ’ co m pe ns at io n la w, an em

pl oyer who acce pt s li ab il it y fo r

th e wor k in

jury of an em

pl oyee “ ha s th e rig ht to ch oo se th e care ” of t he em pl oyee.

Io wa Co de § 85 .27 (4 ). “ [A]n em pl oyee who is di ss at is fie d with th e reas on ab le ne ss

of care pr of

fere d may pe ti ti on th e in du st ria l co m m is si on er fo r rel ie f.” Kl os te r v.

Hor mel Foo ds Co rp

. , 61 2 N.W .2d 77 2, 7 7 5 (Io wa 20 00 ). The pe ti ti on pr oc es s

pe rm it s th e em

pl oyee to se ek an or de r fro m th e co m m is si on e r th at req ui res th e

em pl oyer to pa y

for alt ern at e m ed ic al care pre ferr ed by the em pl oyee.

-6

-Sp en cer arg ue s th at th e di st ric t co ur t erre d by de te rm in in g th at he m us t ex ha us t

ad m in is tra ti ve rem ed ie s be fo re se ek ing j ud ic ia l rev ie w of hi s cl ai m th at Ann et t de ni ed

m ed ic al care in ba d fai th

. Und er Io wa la w, ho wev er, th e “ rig ht s an d rem ed ie s” un de r

th e wor ke rs ’ co m

pe ns at io n s ta tu te s ar e “ th e ex cl us iv e an d on ly rig ht s and rem ed ie s

of th e em pl oyee

. . . [a]gai ns t th e em pl oyee’s em

pl oyer.” Io wa Co de § 85 .20 (1 ). Thi s

ex cl us iv it y pr ov is io n ap pl ie s to “ [c]lai m s of di ss at is fact io n wit h care ,” an d in cl ud es
cl ai m s “ whe re an em

pl oyee was de ni ed m ed ic al care fo r a pe rio d of ti m e.” Goo d v.
Tys on Foo ds , Inc

. , 75 6 N.W.2d 4 2, 4 5- 46 (Io wa Ct . App . 20 08 ).

In th is cas e, Ann et t pr ov id ed Sp en cer’s in it ia l care in Ja nu ary 20 07

, ag reed in
May 20 07 th at it w o u l d a u t h or iz e su rg ery if th e do ct or in Des Mo in es m ad e th e

ap pr op ria te de te rm in at io n, an d ev en tu al ly di d au th or iz e su rg ery in Sep te m be r 20 07

. S p e n cer cl ai m s th at Ann et t act ed in ba d fai th whe n it refu se d to au th or iz e su rg ery
be twee n Ju ne an d Sep te m be r 20 07

. Bu t th is is m erel y a cl ai m of “ di ss at is fact io n wit h

care ,” b a s e d o n Ann et t’s de la y in au th or iz in g su rg ery. The di st ric t co ur t co rrec tl y

ru le d th at Io wa la w req ui red Sp en ce r to ex ha us t th is cl ai m th ro ug h th e ex cl us iv e
ad m in is tra ti ve pr oc es s. Kl os te r , 61 2 N.W .2d at 77 4- 75 ; Goo d

, 75 6 N.W .2d at 45 -4 6.

Sp en cer arg ue s th at ex ha us ti on sh ou ld be ex cu se d, be cau se Ann et t wou ld ha ve
de ni ed li ab il it y fo r th e in

jury. W he n an em

pl oyer de ni es li ab il it y fo r an in jury, it do es

no t ha ve a du ty to pr ov id e m ed ic al care un ti l it s li ab il it y ha s be en de te rm in ed

. W hi le

li ab il it y is di sp ut ed

, th e emp l o y ee m ay no t fil e pe ti ti on s fo r al te rn at e care

. R.R.

Don ne ll y & So ns v. Bar ne tt

, 67 0 N.W .2d 19 0, 19 6- 97 (Io wa 20 03 ). Sp en cer sa y s th e

co m m is si on er in ev it ab ly wou ld ha ve di sm is se d hi s cl ai m of di ss at is fact io n wit h care
be cau se Ann et t’s li ab il it y wou ld ha ve be en un se tt le d. W e reject th i s c o n te nt io n,
be cau se Sp en cer di d no t m ak e a su ffi ci en t sh owi ng of fu ti li ty. Sp en cer fil ed al te rn at e

care pe ti ti on s in Aug us t an d Sep te m be r 20 07

, an d he do es no t c l a i m t ha t Ann et t

de ni ed li ab il it y th en

. The reco rd is in su ffi ci en t to pr es um e th at Ann et t wou ld ha ve
de ni ed li ab il it y i f S p en cer ha d ex ha us te d hi s cl ai m of di ss at is fact io n wit h care

th ro ug h t he ad m in is tra ti ve pro ces s.

-7

-Sp en cer al so arg ue s th at hi s cl ai m is no t real ly ab ou t di ss at is fact io n wit h care

ba se d on de la y , bu t a to ta l den ia l of m ed ic al care

. He co nt en ds th at th e Io wa co ur ts

ha ve reco gn iz ed a ba d- fai th cl ai m ag ai ns t an em pl oyer fo r a to ta l de ni al of care , an d

th at su ch a cl ai m ne ed no t be ex ha us te d wit h th e co m m is si on er. Sp en cer ci te s no

Io wa au th or it y , ho wev er, t ha t reco gn iz es a ba d- fai th cl ai m ag ai ns t an em pl oyer fo r

fai lu re to pr ov id

e med ic al ca re

. The be s t he can do is di rect us to au th or it ie s th at

reco gn iz e cl ai m s ag ai ns t in su rers or se lf- in su red em pl oyers fo r fai lu re to pa

y be ne fi ts

. Se e, e.g

. , McIl ra vy v. N. Rive r In s. Co

. , 65 3 N.W .2d 32 3, 32 8- 39 (Io wa 20 02 ); Boy la n

v. Am. Mot or is ts In s. Co

. , 48 9 N.W .2d 74 2, 74 4 (Io wa 19 92 ). Thi s co ur t’s pr ev io us
ob se rv at io n on th is po in t rem ai ns a co rrec t sta te m en t of Iowa law: “ ‘U p to no w, al l

of th e ap pe ll at e d eci si on s in [Io wa] co ns id eri ng ba d fai th to rts in th e wor ke r’s [s ic ]

c o mp e n s at io n co nt ex t ha ve in vo lv ed a ba d fai th fai lu re to pa y be ne fit s.’” Petr il lo

, 37 8 F.3 d at 77 0 n.3 (q uo ti ng Th ie le n v. Aetn a Ca s. & Su re ty Co

. , No. 00 -1 07 5, 20 03

W L 11 82 04

, at *3 (Io wa Ct

. App

. Ja n. 15

, 20 03 )) (al te rat i o ns in or ig in al ). The

di st ric t co ur t co rrec tl y ru le d th at Sp en cer was req ui red to ex ha us t hi s cl ai m wit h th e

co m m is si on er.

B.

Drawi ng on a di ffer en t li ne of Io wa cas es , Sp en cer co nt en ds th at he pr es en te d

a su bm is si bl e cl ai m ag ai ns t Ann et t fo r ba d- fai th r efu sa l to pa y he al in g- pe rio d

be n e f it s , as op po se d to de ni al of m ed ic al care

. Se e Rod da v. Verme er Mfg

. , 73 4

N.W .2d 48 0, 48 3 (Io wa 20 07 ). To sh ow ba d fai th

, Sp en cer mu s t p r o ve th at th e

em pl oyer ha d no “ reas on ab le ex cu se ” fo r de la y in g or de nyin g be ne fit s. Gib so n v. ITT

Har tf or d In s. Co

. , 62 1 N.W .2d 38 8

, 39 7 (Io wa 20 01 ). So lo ng as th e em pl oyee’s

cl ai m is “ fai rly de ba ta bl e,” th e em pl oyer ha s a reas on ab le ba si s to de la y or de ny, an d

an em pl oyee can no t es ta bl is h bad fai th

. Id

. ; se e al so Bell vi ll e v. Far m Bur ea u Mut

. In s. Co

. , 70 2 N.W.2d 4 68 , 47 3 (I owa 20 05 ).

-8

-Sp en cer a rg ue s t ha t An ne tt act ed in ba d fa it h wh en it refu se d to pa y he al in gpe rio d be ne fit s fro m Apr il to Octo be r 20 07

, whi le Sp en cer was awai ti ng su rg ery on

hi s kn ee. Ann et t refu se d to pa y be ne fit s be cau se Sp e n c e r wou ld no t su bm it to an

ex am in at io n by Ann et t’s cho se n ph y si ci an in Des M oi ne s, and Io wa la w au th or iz es

a su sp en si on of be ne fit s if an em pl oyee refu se s to co m

pl y wit h a reas on ab le req ue st

fo r an ex am in at io n. Io wa Co de § 85 .39

. Sp en cer ack no wled ge s th at an em pl oyer ha s

a rig ht to req ue st an em

pl oyee to su bm it fo r ex am in at io n “ at so m e re a s o n a b le ti m e

an d pl ace an d as o f

t e n as reas on ab ly req ue st ed ,” id

., bu t arg ue s th at Ann et t ha d no rig ht to su sp en d be ne fit s, be cau se it was un reas on ab le fo r th e co m pa ny to as k hi m to

tra ve l o ve r 70 0 m il es fro m Tenn es se e to Iowa

.

The Io wa Su pr em e Co ur t ha s op in ed ab ou t un reas on ab le di st an ces in di ffer en t

co nt ex ts

. The co ur t ru le d th at whe re an e mp l o ye r w a s req ui red to pr ov id e m ed ic al

care to an em

pl oyee, i t was an “ un du e in co nv en ie nc e” un de r I o wa Co de § 85 .27 to

req ui re tra ve l of m or e th an 10 0 m il es fro m Tren to n, Mi ss ou ri to Des Mo in es fo r care by a tre at in g ph y si ci an

. Tr ad e Pro f’l s, In c. v. Sh ri ver , 66 1 N.W .2d 11 9, 12 4 (Io wa

2 0 0 3 )

. Th e co ur t al so up he ld a de te rm in at io n th at wor k of fere d 38 7 m il es fro m a n

em pl o ye e ’s ho m e was no t “ su it ab le wor k,” so th e em pl oyee’s r eject io n of th e of fer

did no t di sq ua li fy hi m fro m rece iv in g di sa bi li ty or he al in g- pe rio d be ne fit s un de r Io wa

Co de § 85 .33 (3 ). Nea l v. Ann et t Hol di ng s, In c. , 81 4 N.W .2d 51 2, 52 5 (Io wa 20 12 ).

Bu t Sp en cer id en ti fie s no au th or it y un de r Io wa Co de § 85 .39 whe re an Io wa co ur t ha s

co ns id ered th e reas on ab le ne ss of the dis ta nc e to an in de pe nd en t m ed ic al ex am in at io n.
The Io wa W or ke rs ’ Co m pe ns at io n Co m

m is si on ha s ex pl ai ne d th at whi le tra ve l to

tre at in g p h ys i ci an s is li m it ed

, th e co m m is si on “ do es no t li m it tra ve l whe n an

em pl oyer ex erci se s it s rig ht to an in de pe nd en t ex am in at io n un le ss lo ng tri ps wou ld

be ha zard ou s to th e he al th of an in jure d wor ke r.” Sw ei sb er g e r v. Empl o y e r / D e f en da nt

, 19 95 W L 17 01 82 48

, at *4 (Io wa W or ke rs ’ Co m p. Co m m ’n
May 5, 19 95 ). Spe nc er ci te s n o Io wa au th or it y to th e co nt rary.

-9

-Giv en th e st at e of th e la w, Ann et t ha d a reas on ab le ba si s to be li ev e th at it co ul d

r e q u e s t S pe nc er to un de rg o an ex am in at io n by th e co m pa ny’ s ch os en ph y si ci an i n

Des Mo in es

. Sp en cer’s refu sa l to su bm it to th e ex am in at io n m ad e th e pr op rie ty of

th e co m pa ny’ s de ni al of he al in g- pe rio d be ne fit s at le as t fai rly de ba ta bl e. The di st ric t

co ur t th us pr op erl y gr an te d su m m ary jud gm en t fo r Ann et t on Sp en cer’s cl ai m of ba dfai th fai lu re t o p ay

be ne fit s.

III.

Ann et t cro ss -ap pe al s th e di st ric t co ur t’s gr an t of pa rti al su m m ary jud gm en t fo r Sp en cer on Ann et t’s co un te rcl ai m fo r frau d. The di st ric t co ur t ru le d th at Ann et t was jud ic ia ll y es to pp ed fro m pr oc eed in g ag ai ns t Sp en cer, be cau se Ann et t ha d a d mi tt ed

li a b il it y in th e pr oc eed in gs on Sp en cer’s Ju ne 20 10 al te rn at e care pe ti ti on

. Ann et t

co nc ed es it ad m it te d li ab il it y fo r th e in jury in t he Ju ne 20 10 pr oc eed in g be cau se of

th e pa rti es ’ s e t tl em en t ag reem en t. Ann et t arg ue s th at th e di st ric t co ur t erre d in

ap pl y in g jud ic ia l es to pp e l

, h o w ev er, be cau se it di d no t gi ve en ou gh weig ht to

ch an ge d ci rcu m st an ces du rin g th e co ur se of th e li ti ga ti on , an d be cau se it ap pl ie d st at e

la w rat he r th an fed eral la w. W e re v i e w a d i st ric t co ur t’s ap pl ic at io n of jud ic ia l

es to pp el for ab us e o f di sc ret io n.

Our pr eced en t cal ls fo r th e ap pl ic at io n of st at e la w el em en ts of jud ic ia l es to pp el

in di ve rs it y cas es

. Mon te re y Dev. Co rp

. v. La wye r’

s Ti tl e In s. C o r

p

. , 4 F.3 d 60 5,

60 8- 09 (8 th Ci r. 19 93 ). Und er Io wa la w, jud ic ia l es to pp el “ pr oh ib it s a pa rty who ha s

su cces sf ul ly an d un eq ui vo cal ly as se rte d a po si ti on in on e pr oc eed in g fro m as se rti ng

an in co ns is te nt po si ti on in a su bs eq ue nt pr oc eed in g.” Wi n n eb ag o In du s., In c. v.

Hav er ly

, 72 7 N.W .2d 56 7, 57 3 (Io wa 20 06 ) (in te rn al qu ot at io n om it te d)

. In Hav er ly

,

a n I o w a cas e an al og ou s to th is on e, an em pl oyer ad m it te d li ab il it y in an ear l i e r

pr oc eed in g on th e em

pl oyee’s pe ti ti on fo r al te rn at e care an d th en di rect ed th e

em pl oyee’s m ed i c a l c are. Id

. at 57 5. The Io wa co ur t de te rm in ed th at on ce th e

em pl oyer ha d ad m it te d l i a b i l it y , it co ul d no t la te r di sp ut e li ab il it y fo r be ne fit s. Id

.

-1 0-The co ur t no te d, ho wev er, th at “ [t]he re m ig ht

, in so m e cas es , be a si gn ifi can t ch an ge

in th e fact s afte r th e ad m is si on of l ia bi li ty tha t co ul d ju st ify a ch an ge of po si ti on by

th e em pl oyer.” Id

.

Ann et t i s i n t he sa m e po si ti on as th e em pl oyer in Hav er ly

. The co m pa ny
ad m it te d li ab il it y fo r Sp en cer’s in jury du rin g it s pa rti ci p a t io n in th e Ju ne 20 10

pe ti ti on pr oc eed in g, bu t no w di sp ut es it s li ab il it y in th is li ti ga ti on

. Ann et t, ho wev er,

in vo ke s Hav er ly ’s po ss ib le ex cep ti on fo r a “ si gn ifi can t ch an ge in th e fact s” th at co ul d
jus ti fy a ch an ge in li ti ga ti ng po si ti o n. The co m pa ny po in ts to in fo rm at io n fro m Sp en cer’s n ei gh bo r th at Sp en cer f ab ric at ed th e cl ai m

of a work -rel at ed in

jury.

Ann et t’s r e li an ce on th e ne ig hb or is un av ai li ng , be cau se th e co m pa ny he ard

fro m th e ne ig hb or in Aug us t 20 09

, an d to ok he r reco rd ed st at em en t in Mar ch 20 10

, bu t co nt in ue d to ad m it li ab il it y fo r Sp en cer’s in jury th ro ug h Ju ne 20 10

. Ann et t sa y s

th e “ si gn ifi can t ch an ge in th e fact s” cam e la te r, in Octo be r 20 10

, whe n th e ne ig hb or
si gn ed a no ta riz ed st at em en t on whi ch th e co m pa ny co ul d rel y

. Bu t th at as se rti on is

be li ed by th e co m

pa ny’ s ch an ge in it s li ti ga ti ng po si ti on in Sep te m be r 20 10 —wi th ou t

a no ta riz ed st at em en t— to fil e co un te rcl ai m s in Sp en cer’s st at e-co ur t act io n. Ann et t

ha d no m or e in fo rm at io n i n S ep te m be r 20 10 whe n it al le ge d frau d by Sp en cer th an

it po ss es se d in Ju ne 20 10 whe n it ad m it te d li ab il it y fo r Sp en cer’s in jury in res po ns e

to a pe ti ti on for alt ern at e car e. The c om pa ny sim pl y ch an ge d i ts po si ti on wit ho ut a

“ si gn ifi can t ch an ge i n th e fact s.” The re was no ab us e of di sc ret io n in ap pl y in g jud ic ia l es to pp el

.

On th e qu es ti on of whi ch la w to ap pl y , th e di st ric t co ur t was bo un d by ci rcu it

pr eced en t to ap pl y Io wa la w, bu t we do no t th in k fed eral la w wou ld le ad to a di ffer en t

res ul t in an y ev en t. Und er fed eral la w, jud ic ia l es to pp el ap p l i es whe n a

pa rty—h a vi ng ta ke n on e li ti ga ti ng po si ti on an d su cces sf ul ly pe rs ua de d a co ur t to

ad op t th at po si ti on —wo ul d de riv e an un fai r ad va nt ag e or im po se an un fai r de tri m en t

on th e op po si ng pa rty by ta ki ng a co nt rary po si ti on in ne w li ti ga ti on

. New Hamp sh ir e

-1 1-v. Mai ne , 53 2 U.S. 74 2, 75 0- 51 (2 00 1)

. The se co ns id erat io ns a r e s u b st an ti al ly

id en ti cal to fact or s th at th e di st ric t co ur t co ns id ered un de r Io wa la w, so th e ch oi ce of

st at e la w rat he r th an fed eral law was im m at eri al

.

* * *

Fo r th e fo reg oi ng reas on s, th e jud gm en t of t h e di st ric t co ur t is affi rm ed

. Ann et t’s m ot io n to st rik e p or ti on s o f Sp en cer’s s up pl em en ta l ap pe nd ix is de ni ed as

m oo t be cau se th e ch al le ng ed m at eri al s are irr el ev an t to ou r di sp os it io n of th e ap pe al

. Se e Mu rf f v. Pr of ’l Me d. In s. Co

. , 97 F.3d 28 9, 2 90 n.1 (8t h C ir. 1 99 6)

.

__ __ __ __ __ __ __ __ __ __ __ __ __ __ __

-1 2-