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State Government for April 2005

Court OKs Workers' Comp for Millionaire


If a knee injury ends the career of a highly-paid pro football player, is he entitled to workers’ comp? The N.C. Court of Appeals says he is.

Ruling in the case of former Carolina Panthers All-Pro lineman Charles H. “Chuck” Smith III, the court said he is entitled to at least $168,000 in workers’ comp benefits, plus medical expenses, and perhaps more. It sent the case back to the N.C. Industrial Commission for further hearings.

Ruling Feb. 15 in an appeal by the Panthers of a decision by the Industrial Commission, Judges Bob Hunter, John Martin and Patricia Timmons-Goodson mostly upheld the commission’s workers’ comp award to Smith.

Smith, who had played eight seasons at defensive right end for the Atlanta Falcons and was co-captain of the Falcons’ 1999 Super Bowl team, signed a five-year contract with the Panthers in March 2000. The contract guaranteed him payments of $800,000 the first year, rising to $4 million for the 2004 season. He also received a $4.5 million signing bonus, a $1 million roster bonus for each season he made the team starting in 2001, and other payments for making public appearances. The contract further stipulated Smith would receive $750,000 in 2002 if the team cut him.

Smith sustained a knee injury during the third game of the 2000 season and was placed on injured reserve. He continued receiving his salary in installments of $47,059 for 17 weeks. The remaining 14 installment payments, totaling $658,826, was injured reserve pay.

After off-season knee surgery, the Panthers named Smith to the 2001 team roster, which entitled him to a $1 million bonus. But in July that year the Panthers terminated Smith’s contract because the team said his skills had deteriorated. The team paid him $87,500 in severance pay. Smith also received $225,000 in installments during the 2001 regular season. In 2002, he received $750,000 pursuant to the one-year skill and injury guarantee addendum to his contract.

Before the matter went to trial, the Panthers agreed to pay Smith $588 per week, the maximum workers’ compensation rate in effect for 2000, until the hearing. The Panthers at first had denied Smith’s injury was compensable under the workers’s comp statute but changed its position in March 2002.

The Panthers argued they were entitled to credits for the payments they made to Smith after his knee surgery. In a July 2002 opinion, Deputy Commissioner Phillip A. Holmes disagreed and ruled that Smith was entitled to 300 weeks of compensation at a rate of $588 per week. The Panthers were awarded a 14-week credit. Holmes awarded Smith workers’ comp at the rate of $588 per week for 286 weeks and medical expenses.

On appeal to the full Industrial Commission, Smith was awarded partial disability compensation of $588 for 300 weeks with a 14-week credit to the team. This would result in a total award of $168,168. Smith also was awarded payment for past and future medical coverage for injuries, diseases and conditions resulting from the injury.

The Panthers appealed, asserting that the team is entitled to a greater credit than that awarded by the commission. But the Appeals Court concluded the commission properly classified the roster bonus, signing bonus, minicamp, workout and appearance fees as plaintiff’s earnings for which the Panthers were not entitled to a credit. The court also upheld the commission’s determination that a September 2000 payment of $47,059 was for services rendered during the prior week, including the game in which Smith was injured. Finally, the court said the commission’s finding that Smith was entitled to 300 weeks of compensation was supported by competent evidence.

However, the commission did not make any findings of fact or conclusions of law regarding the $750,000 payment Smith received in 2002. The case (No. COA03-1130) now returns to the Industrial Commission for proceedings on that and other issues.

Writing for the panel, Judge Martin noted that “this is a rare case in which a highly-paid individual suffered a compensable injury and occupational disease and received several millions of dollars after his injury pursuant to his employment contract.”                — Steve Tuttle



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Last Modified: April 20, 2005
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