Jackson. Segwick Claims Mgmt. Servs.

Plaintiffs, employees of Coca-Cola, suffered work-related injuries and applied for workers’ compensation benefits through Sedgwick, Coca-Cola’s third-party benefit claims administrator. Sedgwick disputed the claims. Plaintiffs claim that Coca-Cola and Sedgwick “engaged in a fraudulent scheme involving the mail . . . to avoid paying benefits to injured employees,” and filed suit under the civil remedies provision of the Racketeer Influenced and Corrupt Organizations Act (RICO), 18 U.S.C. 1962(c). The district court dismissed. On rehearing, en banc, the Sixth Circuit affirmed, holding that the plaintiffs did not plead an injury to their “business or property” that is compensable under RICO. The RICO theory advanced in this case would throw the viability of workers’ compensation schemes into doubt; RICO “does not purport to afford remedies for all torts committed by or against persons engaged in interstate commerce.” The Michigan workers’ compensation scheme provides ample mechanisms by which the employee can contest denials. View "Jackson. Segwick Claims Mgmt. Servs." on Justia Law