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On June 27, 2014, in a case of first impression, the Illinois Appellate Court, First District, delivered a decision allowing an employee to sue his employer outside of the Workers’ Compensation Act and the Workers’ Occupational Diseases Act (“the Acts”) where the employee first learned of his injury after the expiration of the statute of repose periods under the Acts.  In Folta v. Ferro Engineering, 2014 IL App. (1st) 123219, the Illinois Appellate Court reversed the Cook County trial court’s dismissal of an action brought by a plaintiff alleging to have contracted an asbestos-related disease against his direct employer. The plaintiff, James Folta, worked for the defendant, Ferro Engineering from 1966 to 1970, during which time he claims to have been exposed to asbestos-containing products.

On May 17, 2011, forty-one years after leaving his employment with Ferro, the plaintiff was diagnosed with peritoneal mesothelioma. At the time of his diagnosis, the statute of repose periods for any possible action under the Acts had lapsed and therefore, the plaintiff brought a common-law action against his employer, among other defendants, in the Circuit Court of Cook County. In response to the lawsuit, Ferro filed a motion to dismiss, which was granted, wherein it argued that the plaintiff’s action was barred by the exclusive remedy provisions under the Acts.

In reviewing the trial court’s decision, the Illinois Appellate Court noted that the purpose of the exclusive remedy provisions under the Acts is intended to prevent double recovery and to prevent the proliferation of litigation. Also, it noted that the scope of the provisions is not absolute as evidenced by the four exceptions that the Illinois Supreme Court set out in Meerbrey v. Marshall Field & Co., which include (1) the injury was not accidental; (2) the injury did not arise from his employment; (3) the injury was not received during the course of employment; and (4) the injury is “not compensable under the Act[s].” 139 Ill. 2d 455, 463 (1990).

The plaintiff in the Folta case focused solely on the fourth exception and argued that his injury was “not compensable” under the Acts because any potential claim he had was time-barred before he even became aware of his injury. The Workers’ Compensation Act provides for a 25-year statute of repose period for asbestos-related injuries and the Workers’ Occupational Diseases Act provides for a 3-year statute of repose period for asbestos-related diseases. Ferro, on the other hand, argued that an injury under the Acts is “not compensable” only if it does not arise out of and in the course of employment.

The Illinois Appellate Court looked to the Meerbrey case for guidance in evaluating the meaning of the phrase “not compensable under the Act[s].” The Court determined that Ferro’s definition of the phrase, that it is not compensable because it does not arise out of and in the course of employment, would render the fourth Meerbrey exception meaningless because Meerbrey already accounts for exceptions for injuries that did not arise from a worker’s employment (second exception) and that were not incurred in the course of employment (third exception). The Folta Court found that the fourth Meerbrey exception applied to the plaintiff because the plaintiff’s injury was literally not compensable under the Acts since all possibility of recovery was barred by the statute of repose periods under the Acts. The Court did not believe that its decision contradicted the purpose of the exclusive remedy provisions because there is no fear of double recovery by the plaintiff since he is barred from seeking any form of recovery under the Acts, and the decision will not cause the proliferation of litigation since the plaintiff will have only one avenue of recovery, which is the common-law action, against his employer.

Ferro argued that the plaintiff’s interpretation of Meerbrey and the Acts would lead to absurd results, in that employees whose workers’ compensation claims were denied by the Industrial Commission would be free to bring a suit against their employers. The Court disagreed with Ferro’s assessment and stated that its holding is confined to the specific fact pattern where an injured employee’s potential claim under the Acts is time-barred before they even learn of their injuries. The Court also pointed out that other jurisdictions, including Montana and Pennsylvania, have allowed similar common-law claims by employees, and that Ferro did not provide any evidence of “absurd or otherwise problematic consequences resulting therefrom.”

The Folta opinion is notable in that it is a case of first impression for the Illinois Appellate Court on the particular issues discussed above relating to direct common-law actions brought by employees against their employers. It is a decision with potentially far-reaching impact on employers in Illinois and elsewhere whose former employees develop an asbestos-related disease.