State News : Minnesota

Jurgenson v. Dave Perkins Contracting, Inc, No. A24-0507 (Minn. June 25, 2025)

The issue in this case was whether a contingent attorney fee above the statutory cap must be approved if the parties do not object to it.

The employee’s attorney requested $30,000 in fees from a $150,000 settlement, $4,000 above the statutory $26,000 cap set under Minn. Stat. § 176.081, subd. 1(a) (2022). Although the parties stipulated to the fee, the compensation judge approved only the capped amount, denying the excess fee. On appeal, the WCCA affirmed. The employee’s attorney further appealed, raising multiple arguments including a claim that the statutory cap violated the Contracts Clause of the Minnesota Constitution.

The Minnesota Supreme Court rejected these arguments and fully affirmed the trial court and WCCA, holding that the 2024 amendment increasing the attorney fee cap did not apply retroactively; that judges are not required to approve excess fees, even when unopposed; and that the fee cap does not violate the Contracts Clause.

This decision reinforces judicial discretion in evaluating requests for attorney fees and upholds the constitutionality of Minnesota’s attorney fee statute in workers’ compensation cases.

Simonson v. Douglas Cnty., No. A24-1309, 2025 WL 1185074 (Minn. Apr. 16, 2025)

In this case, the Minnesota Supreme Court reaffirmed that employees seeking permanent total disability (PTD) benefits beyond age 67 must rebut the statutory retirement presumption under Minn. Stat. § 176.101, subd. 4, by a preponderance of the evidence.

Konneh v. Sundog Enters., LLC, 2025 WL 1657618 (Minn. WCCA May 2025)

The WCCA held that lay testimony and medical records alone may be sufficient to establish causation in cases involving “commoner afflictions,” such as temporary low back injuries. Relying on precedent from Bender v. Dongo Tool Co., 509 N.W.2d 366 (Minn. 1993), and Carroll v. Univ. of Minn., slip op. (W.C.C.A. May 4, 1999), the court allowed the compensation judge to rely on lay expertise absent a formal medical opinion. Employers should be aware that even in the absence of expert testimony, credible lay evidence may support injury claims involving everyday ailments.

Brunner v. Post Consumer Brands, No. WC24-6569 (Minn. WCCA Jan. 15, 2025)
This case reaffirmed that an employee’s right to assert a direct claim for unpaid medical expenses is not extinguished by a provider’s failure to intervene under Minn. Stat. § 176.361, subd. 2. Employers and insurers must be prepared to defend against medical expense claims brought directly by injured workers, even after a provider’s intervention rights have lapsed.

Recent significant cases:

Tea v Ramsey Cty., 5 N.W.3d 114 (Minn. 2024)

For Minnesota workers' compensation defense, this case underscores the importance of expert testimony, reinforces PTSD compensability under statutory definitions, and provides a clear avenue for dismissing improperly pled psychological conditions like major depressive disorder (MDD). It also limits challenges to DSM-based PTSD diagnoses while reinforcing defense strategies centered on exposure thresholds and expert credibility.

This case reinforces that PTSD is a compensable occupational disease under Minn. Stat. § 176.011, subd. 15, provided it meets the DSM criteria. The ruling confirms that Minnesota courts will defer to credible medical expert opinions when determining whether an employee’s PTSD is work-related. However, the ruling makes it clear that MDD alone is not compensable under Minnesota workers’ compensation law. Defense counsel can use this precedent to argue against the inclusion of standalone psychological conditions unless explicitly pled as consequential to PTSD. In this case, the employer successfully had the MDD finding vacated, setting a precedent for strictly interpreting psychological injury claims.

The Smith v. Carver Cnty., 931 N.W.2d 390 precedent played a crucial role, limiting the WCCA from independently assessing whether an expert’s PTSD diagnosis conformed precisely to DSM-5. This limits a defense strategy that challenges expert opinions by dissecting DSM compliance, shifting the focus instead to credibility and evidentiary weight of expert testimony.

The case highlights the necessity for plaintiffs to explicitly plead consequential injuries (e.g., MDD resulting from PTSD). From a defense perspective, this ruling strengthens motions to dismiss improperly pled psychological claims that are not explicitly tied to a compensable primary injury. This case emphasized repeated exposure to traumatic details as a qualifying factor for PTSD. Employers may attempt to distinguish future claims by arguing that an employee’s level of exposure was insufficient to trigger PTSD.

Peterson v. City of Minneapolis, No. A22-0518 (Minn. 2022)

This case has several significant implications for Minnesota workers’ compensation defense, particularly in the areas of PTSD claims, consequential mental injuries, and penalties for frivolous denials.

This decision expanded the scope of PTSD diagnoses under the DSM-5-TR test. Here, the court acknowledged that the DSM-5-TR may create a "lifetime" PTSD diagnosis, meaning that once an employee is diagnosed with PTSD, it may be difficult for employers to argue that the condition has been resolved. Relying on the Tea v Ramsey Cty., 5 N.W.3d 114 (Minn. 2024) precedent, compensation judges must defer to medical experts in determining whether an employee meets the DSM criteria for PTSD. However, judges are permitted to evaluate expert opinions in light of the DSM but may not independently interpret the DSM to make their own diagnoses. Accordingly, employers and insurers will face greater challenges in arguing that PTSD has resolved or no longer meets DSM criteria, potentially leading to longer-lasting claims and increased liability for PTSD-related wage loss and medical benefits.

The court expressly held that mental health conditions that develop because of a compensable PTSD injury are themselves compensable. This decision extends previous case law (e.g., Rohr v. Knutson Constr. Co. and Radermecher v. FMC Corp.) to apply to mental health conditions resulting from PTSD, such as other specified trauma- and stressor-related disorders (OSTD). Thus, employers may no longer argue that PTSD is the only compensable mental health diagnosis. If an employee’s PTSD leads to depression, anxiety, or other psychological conditions, those secondary conditions will also be compensable, significantly increasing the cost of claims.

Further, the court reinforced the statutory presumption (Minn. Stat. § 176.011, subd. 15(e)) that PTSD in first responders (such as police officers) is presumed work-related unless rebutted by substantial evidence. Under the holding, employers and insurers must communicate all substantial factors used to rebut the presumption at the time of denial, or the denial may be deemed frivolous. Employers and insurers defending PTSD claims from first responders will need strong and immediate medical evidence to rebut causation. Delaying medical evaluations or failing to communicate reasons for denial can lead to penalties.

In addition, the court affirmed a 30% penalty on temporary total disability (TTD) benefits because the employer denied liability without substantial evidence until it obtained an independent medical report. This ruling reinforces Juntunen v. Carlton Cnty., 982 N.W.2d 729 (Minn. 2022) where the Minnesota Supreme Court emphasized that employers must have substantial evidence before denying liability, or they risk penalties. Employers and insurers must carefully evaluate PTSD claims before issuing denials. Any denial without substantial supporting evidence at the time of denial could lead to significant penalties and increased litigation costs.

Johnson v. Concrete Treatments, Inc., 7 N.W.3d 119 (Minn. 2024)

The court was asked to decide two issues (1) whether an employee can assert a direct claim for unpaid medical bills when the unpaid medical providers’ intervention interests were extinguished under Minn. Stat. Section 176.361; (2) whether the WCCA erred in affirming the compensation judge’s findings that Johnson sustained a permanent work-related injury in October 2018 and that 60% of the responsibility for Johnson’s low back condition is properly apportioned to that injury.

This case strengthens employees' ability to seek direct compensation for medical expenses, regardless of provider intervention, and reinforces the deference given to compensation judges' factual determinations on causation. Employers and insurers must be prepared to defend medical claims even when procedural defenses (such as lack of provider intervention) would have previously been successful.

The ruling clarifies that an injured employee retains the right to directly assert claims for medical expenses, even if a medical provider’s intervention interest has been extinguished under Minn. Stat. § 176.361. Previously, there was ambiguity as to whether an employee could still seek reimbursement for medical bills after a provider failed to intervene properly. The court's decision reaffirms that workers' compensation benefits, including medical expenses, are ultimately the employee’s right, and failure by a provider to intervene does not extinguish the employee’s claim. Employers and insurers can no longer rely on a provider’s failure to intervene as a complete bar to liability for unpaid medical expenses. Employers and insurers should ensure that denial of medical expenses is well-documented and supported by substantial evidence to withstand claims directly brought by employees.

The court upheld the compensation judge’s determination that the employee’s 2018 work injury was a substantial contributing factor to his ongoing low back condition, even though conflicting expert opinions existed regarding apportionment. The ruling reinforces that factual findings on causation and apportionment are subject to deference unless manifestly contrary to the evidence. Employers and insurers face a high burden to overturn compensation judges’ factual findings on causation. Even minor errors in medical reports (such as a misdated MRI) may not be enough to discredit an expert opinion entirely. In practice, defense counsel should meticulously scrutinize expert reports for internal consistency and ensure that medical experts provide clear, well-supported opinions on causation and apportionment.

Statutory changes:

Minn. Stat. Section 176.137

The increase in the remodeling cap from $75,000 to $150,000 under Minn. Stat. § 176.137 has significant implications for workers' compensation defense in Minnesota, particularly for employers and insurers managing permanent disability claims.

First, the statutory increase doubles the employer’s potential financial responsibility for home modifications. Insurers and self-insured employers must anticipate higher costs associated with permanent disability claims, particularly for catastrophic injuries requiring extensive home modifications. Adjusters and risk managers must account for increased exposure when setting reserves for claims involving permanently disabled employees.

Previously, the $75,000 cap may have limited modifications to basic accessibility features (e.g., wheelchair ramps, widened doorways). The new $150,000 cap allows for more extensive renovations, including modifications to kitchens, bathrooms, and entire living spaces, leading to higher overall claim costs.

The statute continues to require certification by a licensed architect, but now includes an alternative approval process (i.e., through a certified building official or accessibility specialist, per Subd. 4(b)). This may create looser standards for approval, leading to less stringent scrutiny of requested modifications, increasing employer/insurer liability.

Subd. 3 allows for the purchase of a new residence if remodeling is impractical. The higher cap may lead to more claims for new home purchases, shifting liability from renovations to entire home acquisitions. Employers/insurers should evaluate whether a proposed new home purchase is necessary or merely a preference when contesting such claims.

This statutory increase significantly raises the financial exposure for employers and insurers in permanent disability claims. Employers and defense attorneys should anticipate higher costs, more extensive modifications, and increased litigation over necessity and scope of remodeling projects. The burden will fall on insurers to proactively scrutinize, negotiate, and contest unwarranted claims to control costs effectively.

Minn. Stat. Section 176.081, subd 1

The increase in the attorney fee cap from $26,000 to $55,000 under Minn. Stat. § 176.081 has significant implications for workers’ compensation defense in Minnesota, particularly for employers and insurers managing claims and litigation costs.

First, the higher fee cap makes workers’ compensation claims more attractive to plaintiffs’ attorneys, likely leading to increased litigation over disputed benefits. Plaintiff’s attorneys may take on complex medical and rehabilitation disputes, knowing they can recover higher fees.

Second, Employers and insurers face increased liability for attorney fees, particularly in cases involving disputed medical or rehabilitation benefits. The previous cap of $26,000 often limited extensive legal battles; with a $55,000 cap, attorneys may pursue longer, more complex litigation. Settlement values may increase as claimants’ attorneys push for higher fee recoveries in negotiations.

Third, Under Subd. 1(a)(1), attorney fees for medical or rehabilitation disputes are presumed covered under the 20% contingency fee model, unless inadequate. With the higher cap, attorneys may more frequently argue that contingency fees alone are insufficient, leading to more employer-funded fee awards. Under Subd. 1(c), attorneys can place liens on compensation payments for legal fees. The increased cap means larger portions of employee benefits may be withheld, possibly leading to more employee disputes over fee deductions. Insurers must ensure proper notice is given when withholding compensation for fees.

Lastly, the statute requires attorneys to file a fee statement and provide documentation of hours spent under Subd. 1(d). Employers and insurers should closely review fee requests, challenging excessive or unjustified fees. Under Subd. 1(f), fees not claimed within 12 months must be released to the employee, giving insurers a potential cost-containment strategy.

Taken together, the increased fee cap significantly raises litigation exposure for employers and insurers, incentivizing more aggressive claimant representation and longer legal disputes. Employers should prepare for higher costs, more frequent attorney fee claims, and increased challenges to excessive fees while implementing strategies to mitigate financial impact.

The Minnesota Supreme Court issued its ruling in Johnson v. Concrete Treatments, Inc. on May 29, 2024. The Court overruled the WCCA’s prior ruling that where potential intervenors’ interests had been extinguished and the employee’s attorney did not unequivocally establish representation of parties which had not intervened in the matter, the attorney could not make direct claims for their interests. Writing for a unanimous Court (minus Justice Hennesy, who had not yet joined the Court while this matter was being considered), Justice Procaccini held that “even if a medical provider itself is barred from bringing a claim for medical expenses because it sought to intervene after the statutory deadline, the employee’s right to assert a direct claim for those medical expenses endures.”

This essentially does away with the holding of  Duehn v. Connell Car Care, Inc. (WCCA 2017), where the WCCA concluded that the employee could not assert a claim for medical expenses owed to that medical provider because the employee’s attorney did not establish dual representation of the employee and the untimely intervenor at the hearing.

 Here is the decision in full:

 https://mn.gov/workcomp-stat/sup/Johnson%20Daniel%20-%20sup%20-%2024.html

 (Summary prepared by Attorney Lucas Cragg of Heacox Hartman)

April 2024 Case Law Update

Jurisdiction – Out-of-state Employment

Statutes Construed – Minnesota Statutes § 176.041, Subdivision 3

Where the employee was at his current residence in Minnesota when he was offered and accepted a seasonal job at a North Dakota jobsite, for purposes of Minn. Stat. § 176.041, subd. 3, the employee was hired in the state of Minnesota.

Jurisdiction – Out-of-state Employment

Statutes Construed – Minnesota Statutes § 176.041, Subdivision 3

Where an employee is hired in the state of Minnesota, by a Minnesota employer, and is injured while temporarily working outside the state of Minnesota, the compensation judge properly determined that the employee’s injury is compensable under the Minnesota Workers’ Compensation Act.

Affirmed.

Permanent Total Disability – Retirement

Statutes Construed – Minnesota Statutes § 176.101, Subdivision 4

The statutory presumption of retirement under Minn. Stat. § 176.101, subd. 4 (2016), controls for the employee’s date of injury as the 2018 amendment to the statute does not have retroactive effect.

Permanent Total Disability – Retirement

The record as a whole supported the compensation judge’s conclusion that the employee had failed to rebut the presumption that he had retired at age 67, and the judge did not err by noting the fact that the employee had not sought to supplement his income by returning to work or from other sources.

Practice and Procedure – Dismissal

The compensation judge did not abuse her discretion in dismissing the employee’s claim with prejudice upon determining that he failed to rebut the retirement presumption of Minn. Stat. § 176.101, subd. 4, as the decision was a final order resolving that issue.

Affirmed.

Andrew Thompson v. Minnesota Trial Courts – District 4 and State of Minnesota Department of Administration, Jan. 26, 2024

Arising Out of and in the Course Of

Although the employee was incidentally carrying a work laptop and other work-related materials while commuting to work when he slipped on an icy public sidewalk, substantial evidence supports the finding that the employee failed to meet the “arising out of and in the course of” employment requirements of Minn. Stat. § 176.021, subd. 1, where the compensation judge could reasonably find an absence of a sufficient causal connection between the employee’s injury and his employment under the “special hazard,” “street risk” or “special errand” exceptions.

Affirmed.