A Federal appeals court panel has refused to allow Home Depot,which has opted out of the Texas workers compensation system, todefend itself from a workers compensation claim in federalcourt.

Mark L. Kincaid, a partner at George Brothers, Kincaid &Horton, LLP, based in Austin, said the decision was favorable tothe plaintiff because “there is a perception” state courts aremore keen to employee interests in a workers compensation case thanfederal courts.

“This was a big deal for the worker,” Kincaid said, “because theappeals court decided not to resolve the diversity of decisions byfederal district court judges in this circuit on this issue.”

The panel of the 5th U.S. Circuit of Appeals, based in NewOrleans, upheld a federal district court decision remanding thecase back to Texas state courts.

The case is Mary A. Ernewayn v. Home Depot U.S.A. Inc.The decision was handed down last Thursday.

The lower court had held that even though Home Depot was a“non-subscriber” to the Texas state workers compensation system, itwas still covered through a provision of state workers'compensation law that limited the number of common law defenses acompany can raise in defending itself against a workerscompensation claim, Kincaid said.

Before May, Texas was the only state in the U.S. that allowed acompany to opt-out of its workers compensation system. In May,Oklahoma became the second state to adopt a so-called a“free-market system.”

Under the Oklahoma law, employers have to offer injuredemployees alternative benefit systems that are governed by thefederal Employee Retirement Income Security Act.

According to officials at PartnerSource, an insurance brokeragebased in Dallas that is a division of Arthur J. Gallagher RiskManagement Services, Inc., a number of states are consideringadopting the opt-out system.

In this case, Mary A. Ernewayn, 55, of Socorro, Texas, filedsuit in state court in August 2012. She claimed Home Depot wasnegligent. She alleges that she suffered neck and back injuries in2011 when operating a lumber cart in a Home Depot store that wasfiled with plywood. When the cart collapsed, according to courtdocuments, she was injured when pinned between the lumber cart anda pickup truck, court records show.

Ernewayn filed suit in state court, but Home Depot sought toremove the case to federal court. It argued that because it“opted out of the Texas workers compensation system, it coulddefend the case in federal court.

In a decision last December in federal district court in ElPaso, Judge David C. Guaderrama ruled that “any ambiguities”dealing with whether a case should be held in state or federalcourt are “construed against removal.” He added that, “the courtconcludes that the instant action is not removable, and the casetherefore must be remanded.” It was this decision that the5^th Circuit decision upheld.

Kincaid, who is also an adjunct professor at the University ofTexas Law School, said he is aware that there is a perception thatcourts in Texas are biased against workers compensation claims.However, in practice, state courts and state appellate courts arein practice either balanced or sympathetic to workers oncompensation claims. Only the Texas state Supreme Court is seen asbiased against workers on these issues, but it has sole discretionwhether to appeal a case, which raises a question as to whether adefendant company in a workers comp claim wants to risk winningsupport for state High Court review of a claim, he said.