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Employers could face costly new liabilities for workers injured on the job following a ruling Tuesday by the state's highest court that clarifies when someone suffers a permanent total disability in New York.

In a case involving an Amherst man who fell off a ladder on a construction project in 1998, the Court of Appeals said a disability occurred -- for the purposes of certain kinds of litigation -- when a head injury prevented Thomas Knauer from being able to ever work again. No longer, as some courts have found, does the injured worker have to be in a vegetative state, the court said.

The closely watched case, which also included two downstate workplace injury lawsuits, focused on what constitutes a "grave injury" under the state's workers compensation law.

Workers who are injured on the job are permitted to collect workers compensation, but they are then prevented from directly suing their employer. Previously, workers could, however, sue others -- for instance, the manufacturer of some machinery used in a factory on which they were injured. The machine maker could then, in turn, sue a worker's employer for failing to keep the machines running safely or some other negligence.

But in 1996, the state Legislature and Gov. George Pataki instituted reforms to the workers compensation system that made it more difficult for such third-party lawsuits against employers. Such lawsuits were barred unless an employee suffered a "grave injury," which was given certain definitions, such as amputation of a leg.

But one key area of the list of "grave injury" exemptions was what constitutes a "permanent total disability" from an on-the-job head injury.

In Knauer's case, he fell off a ladder, and landed on his head, while doing work for an electrical firm owned by his brother on a job in Clarence. Following a five-week trial in 2002, Knauer was awarded $11 million by an Erie County jury. Lawyers for the electrical company did not return calls for comment.

The insurance carriers for BTS Services, the general contractor of the construction project, and the estate of the late William Anderson, who owned the land, would have been responsible for the $11 million, but they in turn successfully sued Knauer's employer for negligence. The court's ruling means that Knauer's employer, or more precisely its insurance carrier, will be responsible for the $11 million award.

Appeals' courts in New York have split on what constitutes a grave injury that would allow such third-party lawsuits. Two courts have said that the injured worker's injuries must be so grave that they are essentially in a vegetative state. But two other appeals courts in New York have said a worker's head injury must only be severe enough so as to keep them from being employable; on Tuesday, the state's highest court agreed with that interpretation.

The Court of Appeals said the vegetative state standard "is too harsh a test, out of step with the balance" of the 1996 law.

Lawyers called it a major case because efforts had been under way to restrict access to the courts to only cases in which workers with head injuries were totally incapacitated. Buffalo attorney Terrence Connors, who along with John Loss, represented Knauer, said the court's decision will mean his client "will be able to collect the funds necessary to sustain his future."

More broadly, though, Connors said the decision Tuesday loosens up the strict, narrow interpretation of what constitutes a grave injury under the 1996 law. Though he doesn't believe it will lead to a rash of new lawsuits, the court's ruling does end the attempt by some state officials to make the definition of such injuries stricter as a way to alleviate the burden on employers.

"For injured workers with brain injuries, this gives them an opportunity to have a recovery when they can't work anymore," Loss added.

Norman B. Viti Jr., who represented BTS Services, said the court's ruling doesn't weaken the 1996 reforms to the workers compensation law, but merely clarifies it to ensure that only the most serious of workplace injuries end up in third-party legal actions. "This is exactly what the Legislature intended," he said. With the court's ruling, Viti added, "The blur is now over."


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