In Kasal v. Stryker Corp. (2019AP1017), the Court of Appeals District I held that an insurer was not entitled to attorney fees in a third-party liability worker’s compensation case because the insured’s policy precluded recovery of attorney fees.

Aurora hospital employee Mary Kasal was injured by a piece of equipment at work. Kasal subsequently filed a third-party liability worker’s compensation claim against Stryker Corp., which manufactured the equipment. Aurora and its insurer Sentry Insurance joined the claim, as allowed under Wis. Stat. § 102.29. When Kasal reached a settlement with Stryker, Sentry objected to the settlement, seeking attorney fees, which were not included in its payment under the proposed settlement. The circuit court approved the settlement without attorney fees for Sentry. Sentry appealed.

The Court of Appeals agreed that Sentry was not entitled to attorney fees. A provision in the Aurora policy with Sentry allows Sentry to recover payments from anyone liable for the injury (i.e. Stryker). Because the policy is silent on whether Sentry may recover attorney fees from a third party liable for the injury, the court found that Sentry was not entitled to attorney fees in the settlement. The court determined that the policy provisions superseded Wis. Stat. § 102.29(1)(c), which typically requires attorney fees for third-party liability worker’s compensation lawsuits.