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Court Rules Disabled Officer's Illegal Drug Sales Were 'Remunerative Employment,' Orders Repayment of Benefits

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2010-1770.  State ex rel. McNea v. Indus. Comm., Slip Opinion No. 2012-Ohio-1296.
Franklin App. No. 09AP-605, 2010-Ohio-4186.  Judgment affirmed.
O'Connor, C.J., and Pfeifer, Lundberg Stratton, O'Donnell, Cupp, and McGee Brown, JJ., concur.
Lanzinger, J., concurs in judgment only.
Opinion: http://www.supremecourt.ohio.gov/rod/docs/pdf/0/2012/2012-Ohio-1296.pdf

(March 29, 2012) The Supreme Court of Ohio ruled today that a disabled Parma police officer who engaged in the illegal sale of prescription pain-killer drugs while he was receiving state workers’ compensation benefits engaged in “sustained remunerative employment,” and therefore must return benefits he collected after the date of his first confirmed drug sale.

The court’s 7-0 per curiam decision affirmed a ruling of the Tenth District Court of Appeals.

Officer Donald McNea was granted workers’ compensation benefits for permanent total disability (PTD) beginning in August 2004 based on injuries he claimed to have sustained in the performance of his official duties. At the time that award was approved, however, none of the parties knew that McNea was being secretly investigated by his own department for the suspected illegal sale of prescription drugs.

Between October 1 and December 23, 2005, McNea was recorded selling OxyContin to undercover police informants on four separate occasions, netting a total of $6,200 from those transactions. He was arrested on December 23, 2005, and was later indicted on 20 counts of criminal activity. On September 7, 2007, McNea entered guilty pleas to four felony charges and was sentenced to three years in prison.

In November 2007, the Bureau of Workers’ Compensation (BWC) filed a motion asking the Industrial Commission to terminate all further benefit payments to McNea, and to order him to repay all of the benefits he had received since his original award of PTD was approved in August 2004. A commission staff hearing officer (SHO) terminated benefits as of September 5, 2007, the date McNea began his prison sentence, under a provision of law that bars the payment of benefits to incarcerated persons  The SHO declined, however, to declare that any benefits McNea received before that date had been overpaid because there was “no proof that the injured worker was involved in sustained remunerative employment at the time of the permanent and total disability hearing.”  

BWC urged the commission to grant reconsideration, claiming that the SHO had made clear mistakes of law and fact in finding no evidence of sustained remunerative employment during the time McNea was receiving PTD compensation. The commission agreed and granted reconsideration.  It ultimately declared that all compensation paid after McNea’s first confirmed drug sale on October 1, 2005, constituted an overpayment.

McNea filed a complaint in mandamus in the Tenth District Court of Appeals, asking that court to hold that the commission had abused its discretion in overruling the SHO’s decision and terminating his benefits prior to September 2007. The court of appeals found that no abuse of discretion had occurred and denied the writ. McNea then exercised his right to appeal the Tenth District’s ruling to the Supreme Court.

In today’s unanimous decision affirming the Tenth District, the court rejected McNea’s argument that his PTD benefits should not have been terminated for any period prior to his commitment to prison on  September 5, 2007, because there was no evidence that he had engaged in “sustained remunerative employment” during that time period.

Citing its holding in State ex rel. Lynch v. Industrial Commission (2007)thatthe illicit sale of drugs could constitute sustained remunerative employment sufficient to terminate PTD, the court wrote: “(T)he SHO based his decision on a lack of evidence that McNea was working at the time of the PTD hearing.  This reasoning is too narrow and constitutes a clear mistake of law. The correct focus is not on whether McNea was performing sustained remunerative employment on the date of the PTD hearing. The question is whether at any time during the receipt of PTD compensation, McNea was (1) doing sustained remunerative work, (2) medically capable of sustained remunerative employment, or (3) engaged in activities medically inconsistent with the alleged disability.”

“The commission, in granting reconsideration, relied on Lynch’s declaration thatremunerative employment encompasses any remunerative activity, legal or otherwise. ... The commission thus found that the SHO had committed a clear mistake of law and fact in failing to take McNea’s illegal sales activity into account. This finding is not an abuse of discretion and is accordingly upheld.”

“In this case, the evidence established an ongoing pattern of phone calls and other sales-related activity that culminated in the four recorded sales that McNea made between October and December 2005.  The commission characterized this sales activity as sustained remunerative employment, and we decline to disturb that finding. The commission also extrapolated from its finding that McNea continued to possess the medical ability to engage in such activity even after his arrest. This conclusion is also sustained.”

“McNea was performing sustained remunerative work through late December 2005, and there is no evidence that his medical condition changed afterwards so as to preclude that endeavor. The commission also found no evidence suggesting that McNea would have abandoned his long-running enterprise had he not been arrested. ... (T)he commission did not abuse its discretion in concluding that McNea remained medically capable of sustained remunerative work after his arrest and was not entitled to PTD compensation thereafter. ... The judgment of the court of appeals is affirmed.”

The court’s opinion was joined by Chief Justice Maureen O’Connor and Justices Paul E. Pfeifer, Evelyn Lundberg Stratton, Terrence O’Donnell, Robert R. Cupp and Yvette McGee Brown.  Justice Judith Ann Lanzinger concurred in judgment only.

Paul M. Friedman, 216.241.1007, for Donald McNea Jr.

Derrick L. Knapp, 614.752.2095, for the Ohio Industrial Commission.