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ADMINISTRATIVE COM. OF WAL-MART STORES v. HUMMELL

February 21, 2003

ADMINISTRATIVE COMMITTEE OF THE WAL-MART STORES, INC. ASSOCIATES' HEALTH AND WELFARE FUND, PLAINTIFF,
V.
JEAN HUMMELL, DEFENDANT.



The opinion of the court was delivered by: James B. Zagel, District Judge

MEMORANDUM OPINION AND ORDER

These are cross-motions for summary judgment in a dispute between a Wal-Mart health and welfare plan ("the Plan") and an employee — Jean Hummell — covered under the Plan. Hummell was injured in an accident, and the Plan paid $16,698.10 in medical benefits on her behalf. She subsequently retained a lawyer to prosecute a personal injury case. The attorney, working on a one-third contingency fee, secured a settlement (after the second day of a jury trial) in the amount of $150,000. The lawyer offered to reimburse the Plan for its expenses but only after deducting one-third of the amount to compensate him for securing the recovery. The offer was refused, but there was agreement by Hummell's lawyer to keep the full amount in his client trust fund account until a final judicial decision was made on the question of the lawyer's entitlement to any part of the amount now held in the trust account. This issue has arisen from time to time in this and other courts.

The Plan provides that it has the right to recover 100 percent of the benefits it previously paid to the extent of any and all of the following payments:

. Any judgment, settlement, or any payment made or to be made by a person considered responsible for the condition giving rise to the medical expense or by their insurers.
. Any auto or recreational vehicle insurance coverages or benefits including, but not limited to, uninsured motorist coverage.
. Business and homeowners medical liability insurance coverage or payments

. Attorney's fees.

The Plan also requires cooperation from covered employees to effectuate its right to recover:

The Plan requires that you . . . cooperate to guarantee reimbursement to the Plan from third party benefits. Failure to comply with this request will entitle the Plan to withhold benefits due you under the Plan Document. You or your covered dependents may not do anything to hinder reimbursement of overpayment to the Plan after you have accepted benefits.
Note: All attorney's fees and court costs are the responsibility of the participant, not the Plan.

These rights apply regardless of whether such payments are designated as payment for, but not limited to:

. Pain and suffering

. Medical benefits

. Other specified ...


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