Injury in 1993.  Employer sought suspension in 2007.  Suspension was initially denied and unreasonable contest attorneys’ fees of about $15K awarded, but through extensive litigation, by 2012, suspension found warranted.  Claimant was actually in his 80s by then, but was found to have failed to follow through on a job offer.

Long story short, Claimant’s counsel has to return the $15K in attorneys’ fees because, ultimately, Employer was successful.  This case extends Barrett v. WCAB (CC 2010) to unreasonable contest attorneys’ fees Per Barrett, where litigation costs are awarded and are paid by the employer as a result of denial of a stay and the award of costs is later reversed on appeal, the employer is entitled to an order requiring the claimant’s counsel to repay the erroneously awarded costs).

Here, “Although Barrett involved non-attorney fee litigation costs, our reasoning in Barrett is equally applicable to the unreasonable contest attorney fees here and compels the conclusion that Employer is entitled to an order requiring Counsel to refund the $14,750 that he was erroneously awarded. Every factor on which this Court based its holding in Barrett is present here.”

Cosgrove dissented alone, but strongly, which may be enough for SCOPA to take it up: “Even more troubling is the Majority’s conflation of two discrete concepts: costs and attorney fees. The Majority suggests that since Section 440 discusses attorney fees in the context of costs, then these fees must be nothing more than a species of costs, not unlike the expense incurred in the taking of a deposition as was addressed in Barrett. But attorney fees are not merely costs. They are awarded in the successful unreasonable contest case under Section 440 for important policy reasons, “serv[ing] both to discourage [unreasonable] contests and to encourage competent legal representation” in unreasonable contest claims. Eugenie v. Workmen’s Compensation Appeal Board (Sheltered Employment Service), 592 A.2d 358, 361 (Pa. Cmwlth. 1991) (emphasis added). The present ruling flouts this policy and can only work to discourage rather than encourage counsel’s participation in the workers’ compensation process, and diminish the importance of skilled advocacy to that process.

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