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You can search the entire site. or go to the recent opinions, or the chronological or subject indices. Sandra J. Rusch v. Southeast Alaska Regional Health Consortium and Alaska National Insurance Company, Brenda Dockter v SEARHC and Alaska National Insurance Company (12/6/2019) sp-7422

Sandra J. Rusch v. Southeast Alaska Regional Health Consortium and Alaska National Insurance Company, Brenda Dockter v SEARHC and Alaska National Insurance Company (12/6/2019) sp-7422

         Notice:    This  opinion   is  subject   to  correction  before  publication   in   the  PACIFIC  REPORTER.  

         Readers  are r   equested  to  bring  errors to the attention  of  the  Clerk  of  the  Appellate C  ourts,  

         303  K  Street, Anchorage, Alaska  99501, phone   (907)  264-0608, fax   (907)  264-0878,  email  

                    THE  SUPREME  COURT  OF  THE  STATE  OF  ALASKA  

SANDRA  J.  RUSCH,                                          )  

                                                            )     Supreme  Court  Nos.  S-17069/17070  

                            Appellant,                      )    (Consolidated)  



         v.                                                 )    Alaska Workers' Compensation  


                                                            )    Appeals Commission No.  17-001  


SOUTHEAST ALASKA REGIONAL                                     


HEALTH CONSORTIUM and ALASKA                                     O P I N I O N


NATIONAL INSURANCE COMPANY,                                    


                            Appellees.	 	                   )  



                                                                 No. 7422 - December 6, 2019  



BRENDA DOCKTER,                                             )  


                                                                 Alaska Workers' Compensation  


                            Appellant,                      )    Appeals Commission No.  17-002  


         v.	 	                                              )  



SOUTHEAST ALASKA REGIONAL                                   )  






                            Appellees.	 	                   )  




                   Appeals from the Alaska Workers' Compensation Appeals  



                   Appearances:  J.  John  Franich,  Franich  Law  Office,  LLC,  


                   Fairbanks, for Appellants.  Michael A. Budzinski, Meshke  


                   Paddock & Budzinski, Anchorage, for Appellees.  

----------------------- Page 2-----------------------


                    Before: Bolger, Chief Justice, Winfree, Stowers, Maassen,  


                    and Carney, Justices.  


                    STOWERS, Justice.  



                    Anattorneybegan representingtwo injured workers afterbothencountered  


difficulties representing themselves in their workers' compensation claims against the  


same  employer.             Both  claimants  then  successfully  resolved  their  claims  through  


mediation, with both receiving  substantial settlements.   The parties were unable to  


resolve the question of their attorney's fees, so the Alaska Workers' Compensation  


Board held hearings on that issue.  The Board limited the witnesses at the hearings and  


ultimately awarded significantly reduced attorney's fees in both claims.  The Alaska  


Workers' Compensation Appeals Commission affirmed the Board's decisions. Because  


the Commission incorrectly interpreted our case law about attorney's fees, because the  


Board denied the claimants the opportunity to present witnesses, and because the amount  


of attorney's fees awarded to both claimants was manifestly unreasonable, we reverse  


in part the Commission's decisions and remand for further proceedings.  




          A.        Factual Summary Of Each Case Through Settlement  


                    1.       Rusch v. Southeast Alaska Regional Health Consortium  


                    In June 2012 Sandra Rusch injured her back while working for Southeast  


Alaska Regional Health Consortium (SEARHC) at its clinic in Klawock. Her healthcare  

providers imposed various lifting restrictions while she received treatment.  SEARHC  


filed a controversion in October 2012 claiming it had no evidence to support time loss  


from work.  Rusch had fusion surgery on her lumbar spine in January 2013.  Medical  

                                                              -2-                                                       7422

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records show that doctors disagreed about the degree of "incorporation" of the fusion.                                                                                                                       

After the surgery Rusch's healthcare providers continued restrictions on lifting.                                                                                          

                               In January 2013 SEARHC paid Rusch temporary partial disability (TPD)                                                                                         

from June through December 2012 and began to pay temporary total disability (TTD)                                              

as   of   early   January.     At   about  the   same   time   SEARHC   sent   a   form   notice   to   the  

Reemployment Benefits Section of the Board informing it that Rusch had "been totally                                                                                                        

unable to return to [her] employment at the time of injury for 45 consecutive days as a                                                                                                                 

                                                                                                                 1   Its insurance adjuster handwrote that  

result of the injury," beginning on June 24, 2012.                                                                                                                                                

Rusch had received TPD from June 2012 until mid-December 2012 and had begun to  


receive TTD in early January 2013.  The only communication in the record from the  


Board about reemployment benefits is a brief email to Rusch asking her to call if she had  




                               Rusch was laid off from her job, purportedly due to a reduction in force, in  


April 2013. Rusch had been disciplined the previous month for an incident she said was  


related to "not lifting up to 50 pounds" as her job description required. Rusch's surgeon  


had released her to "light duty as tolerated" effective March 1, 2013.  The position she  


previously held was advertised the month after her layoff and included the ability to lift  


70 pounds as a job requirement.  


                               In 2014 SEARHC offered Rusch "$15,000.00 in medical benefits to help  


defray thecost ofadditional careother than fusion revision, if medically necessary within  


the first year following Board approval" of a settlement; in exchange Rusch would give  


                1              See  AS 23.30.041(c) (requiring notice of reemployment benefits to an  


employee who has been unable to return to work for 45 consecutive days because of a  


work-related injury). "Reemployment benefits are intended to return an injured worker  


to remunerative employment when she cannot return to her former job or jobs for which  


she has the relevant training or experience."  Vandenberg v. State, Dep't of Health &  


Soc. Servs., 371 P.3d 602, 607 (Alaska 2016).  


                                                                                                  -3-                                                                                          7422

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up all other compensation.   The proposed agreement made clear that Rusch's future  


medical benefits would be "restricted," specifically providing that SEARHC would "be  


responsible  for  medical  and  related  transportation  benefits  relating  only  to  fusion  


revision, if medically necessary within one year from the date of [Board] approval or  


rejection of this Agreement."  Rusch initially agreed, but she did not sign SEARHC's  


proposed settlement document.  SEARHC's attorney, Theresa Hennemann, informed  


Rusch in May 2015 that her  settlement authority had lapsed and that the workers'  


compensation insurance carrier would be closing its file related to her claim.  


                    Attorney David Graham of Sitka entered an appearance and filed a written  


claim on Rusch's behalf in June 2015, seeking a number of compensation benefits  


including TTD, permanent partial impairment (PPI), medical costs, and reemployment  


benefits, and also claiming unfair or frivolous controversion.  SEARHC filed an answer  


and a controversion in late July denying that any further compensation was owed.  In  


October SEARHC offered to settle all claims for a total of $15,000, with $10,000 for  


future medical benefits and $5,000 for attorney's fees.  Rusch did not accept the offer.  


                    The case was contentious,with anumber ofdiscovery disputes. The parties  


later  resolved  all  claims  except  attorney's  fees  through  mediation.                                The  settlement  


agreement preserved Rusch's claim for attorney's fees and costs and required SEARHC  


to pay $1,000 to one medical provider and an additional $100,000 to Rusch.  The Board  


approved the settlement in early August 2016.  


                    2.        Dockter v. Southeast Alaska Regional Health Consortium  


                    In February 2014 Brenda Dockter injured her left knee while working for  


SEARHC in Sitka.   After physical therapy and medication did not resolve her pain  


complaints, she had arthroscopic knee surgery, which improved her symptoms but did  


not  resolve  them  entirely.                All  doctors  who  examined  her,  including  SEARHC's  

                                                               -4-                                                        7422

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orthopedic physicians, said she would at some point need further knee surgery as a result                                                  

of the work injury.               

                       In   June   2015,   based   on   its   doctor's   opinion,   SEARHC   controverted  

physical   therapy   and   two   medications.    Dockter's   treating   orthopedic   physician  

recommended   in   October   2015   that   she   undergo   a   partial   knee   replacement.     The  

surgeon's   office   asked   SEARHC to                            preauthorize   the   surgery;   through  its  attorney,  


Hennemann, SEARHC informed the doctor it was "not in a position to preauthorize  


surgery at this time" [emphasis in original] because in its view Dockter's pain complaints  


did "not appear to be supported by objective medical evidence."  If SEARHC sought an  


opinion from one of its orthopedic physicians about the partial knee replacement, it did  


not submit that opinion to the Board.  


                       After  Dockter  sought  clarification,  Hennemann  reiterated  SEARHC's  


refusal to preauthorize the surgery, informing Dockter that she could "make [her] own  


arrangements."  As an alternative SEARHC offered to settle the claim on the following  


terms:   SEARHC would pay medical expenses for the partial knee replacement and  


follow-up care (excluding physical therapy) and a lump sum of $21,024 (representing  


TTD, PPI, and a sum for physical therapy); in exchange Dockter would waive all future  


workers' compensation benefits except for follow-up care related to the partial knee  


replacement occurring within eight months of the Board's approval of the settlement.  


                       Dockter  filed  a  written  claim  seeking  unspecified  medical  benefits  in  


August  2015,  and  the  Board  held  its  first  prehearing  conference  on  the  claim  the  


following month.  At this prehearing conference, SEARHC indicated it had "accepted  


compensability for medical . . . costs relating to [Dockter's] left knee" with limited  


exceptions unrelated to the partial knee replacement.  A second prehearing conference  


was held in late November "to review the status of [Dockter's] injuries/treatment and  


claims." Dockter explained she had requested preauthorization for her knee surgery, and  

                                                                       -5-                                                                 7422

----------------------- Page 6-----------------------

SEARHC told the prehearing conference officer that "no controversion [was] in place   

regarding the knee injury/treatment." According to the prehearing conference summary,                                                                            

"[w]hen asked why [SEARHC] will                                           not pre-authorize the surgery, [SEARHC]stated that                                                  

 'they were not saying that the surgery was not medically necessary, just that there is not                                                                                    

yet any objective evidence to support the surgery.' " The prehearing conference officer,                                                                               

                                                                2  thought one issue - whether Dockter was "entitled to  

after quoting AS 23.30.095(a),                                                                                                                                                    

an order" requiring SEARHC to pay for the surgery - was "ripe for a hearing" and set  


another prehearing conference to schedule this hearing.  


                            Hennemann wrote to the Board shortly afterward, taking the position that  


SEARHC was "simply choosing to exercise [its] statutory right" to "take up to 30 days  


to consider whether payment or denial should issue after" the doctor billed it for the  


surgery.  SEARHC objected to a prehearing conference on scheduling because Dockter  


had not filed an affidavit of readiness for hearing.  


                            On  December  8  Graham entered  an  appearance  for  Dockter  and  filed  


another written claim on her behalf.  The parties agreed they were not yet ready for a  


hearing.  After obtaining discovery from SEARHC, Graham wrote a demand letter to  


Hennemann  in  early  February  2016;  there  he  summarized  the  medical  evidence  


supporting the surgeon's recommendation and informed her that because SEARHC  


refused to preauthorize the surgery, the doctor would not perform the surgery without  


prepayment, which Dockter could not afford.  Graham told Hennemann that he would  


"request further assistance from the Board" if SEARHC did not clearly communicate to  


the surgeon that it would preauthorize the surgery by a certain date.  


              2             AS 23.30.095(a) requires the employer to "furnish medical, surgical, and  


other . . . treatment . . . which the nature of the injury . . . requires" within the first two  


years of a work-related injury.  


                                                                                        -6-                                                                                7422

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                    Hennemann responded that SEARHC "would not stand in the way of" a  


hearing  on  what  she  called  an  "advisory  ruling[]"  from  the  Board  about  the  


compensability of the surgery and suggested as an alternative that  Dockter "find a  


different physician who would not require payment before surgery"; she indicated she  


would "encourage" her clients to "consider" a request for a change in physicians if  


Dockter found such a surgeon.  


                    On February 9 Dockter filed an affidavit of readiness for hearing, a request  


for  an  emergency  conference,  and  a  request  for  "an  immediate  hearing"  on  the  


"prospective  determination  of  [the]  compensability"  of  the  knee  surgery.                                              On  


February 18 SEARHC told the Board it agreed the knee surgery "would be compensable  


and payable under the Act," making a hearing on that issue unnecessary. It later insisted,  


however,  that  it  had  not  preauthorized  the  surgery.                             Dockter  had  the  surgery  in  


March 2016.  


                    The parties mediated the remaining disputes and reached agreement on all  


issues except attorney's fees. The Board approved the settlement in August 2016. Under  


its terms, Dockter agreed to release SEARHC fromfurther claims (except attorney's fees  


and costs) in exchange for an additional $122,500.  


          B.        Procedure In Both Cases Following Mediation  


                    Billing records from both attorneys suggest they remained in contact with  


the mediator about the attorney's fees disputes after settlement. Hennemann's July 2016  


billing records included entries related to a "memo to mediator" about fee issues as well  


as communications with the mediator and both her clients about fee issues. Hennemann  


submitted her billing records only through July 2016, so the record does not reveal  


whether she communicated further with the mediator in August.  Graham submitted to  


the mediator a document he called a "mediation brief" that addressed specific concerns  


raised by SEARHC as well as the mediator's responses to them. No mediation occurred,  

                                                               -7-                                                         7422

----------------------- Page 8-----------------------


however, and the mediator wrote to the attorneys in September acknowledging their  


request for a hearing on attorney's fees, "which the parties were unable to resolve  


through mediation."  


                    The Board scheduled twohearings on the sameday to resolvetheattorney's  


fees disputes in both cases. The lead-up to the hearings was contentious. The prehearing  


conference summaries set an October 19 deadline for submission of witness lists but also  


allotted time for argument equal to the total time scheduled for hearing.  Hennemann  


wrote to the Board on October 14 because Graham intended to call witnesses at the  


hearings and she thought this was "inconsistent with the discussions and agreements for  


proceeding."           Graham  responded  that  on  October  7  he  had  spoken  with  a  Board  


employee who told him he "would not need to request amendment or clarification of the  


prehearing conference summary in order to" present witnesses at the hearing. The issue  


was not addressed until the hearing.  


                    Graham submitted an affidavit of fees for each case, seeking an hourly fee  


of  $425.        He  sought  payment  for  277.55  hours  in  Rusch's  case  and  180  hours  in  


Dockter's case. The witness list in each case included Graham, three other attorneys, and  


the claimant in that case.  The proposed attorney witnesses either practiced workers'  


compensation law in Alaska or were familiar with Graham's legal experience.  


                    The Board held both hearings on October 25, 2016.  The Board decided to  


"go through some preliminary issues" in both cases at once, then proceed separately with  


argument related to each case individually. Both claimants attended telephonically (and  


later testified) during the joint proceeding.  SEARHC objected to all of the witnesses  


except Graham, although it complained that allowing Graham to testify would give the  


claimants a "time advantage" because the parties had an equal amount of argument time.  


It argued that testimony fromthe other witnesses (including the claimants) was irrelevant  


or unnecessary because the information the witnesses might provide was available in the  

                                                               -8-                                                         7422

----------------------- Page 9-----------------------

Board's "system" or because SEARHC was willing to stipulate to certain facts, such as                                                                                                  

the difficulties injured workers face in finding attorneys to represent them, "particularly                                                                     

in the Juneau venue and the Fairbanks venue."                                                         SEARHC took the position that what it                                             

called "enhanced fees" were only allowed "based upon an attorney's experience in the                                                                                                 

field of workers' compensation."                                         Graham argued that all factors in the Alaska Rules of                                                         

                                                3   as  well  as  workers'  compensation  law  were  relevant  to  the  

Professional   Conduct                                                                                                                                                              

reasonableness of the requested fees, making the attorney witnesses' testimony directly  


relevant.  He contended that the claimants should be allowed to testify because factors  


relevant to an attorney's fees award included "issues relating to the client."  


                             The Board permitted both claimants to testify, but decided none of the  


attorneys, including Graham, could do so.  The Board said that "case law" (which it did  


not identify) directed the Board to consider only experience in workers' compensation  


law when evaluating an attorney's fees request.  The Board decided Graham had "been  


afforded the opportunity to provide information in his brief" and declined to "provid[e]  


extra time for testimony."   The Board decided the testimony of other witnesses was  


either  irrelevant,  repetitious,  or  both.                                             The  Board  told  the  parties  it  would  gather  


information from its system about the hourly rates received by workers' compensation  


attorneys and Graham's experience in workers' compensation cases to use in deciding  


the case.  


                             Grahamasked the Board to clarify how he could present evidence about his  


experience because "[a]rgument is not evidence." He pointed out that the only evidence  


in  the  record  was  his  fee  affidavit,  which  did  not  contain  information  about  his  


experience.   The hearing officer said it was "difficult to distinguish between a legal  


              3              These factors are virtually identical to those we set out in Wise Mechanical  


Contractors v. Bignell.  See 718 P.2d 971, 974 n.7 (Alaska 1986) (listing factors from  


Alaska Code of Prof. Resp. DR 2-106(B)).  


                                                                                           -9-                                                                                  7422

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argument and testimony" from Graham and indicated the Board had "the record of                                                         



                which she characterized as "our workers' compensation system." She saw no  


need to provide Graham with a copy or a printout of the information the Board would  


use because decisions and orders were "in the public sphere"; she told Graham that he  


could  ask  for  reconsideration  of  the  Board's  decision  if  "there's  something  that's  


incorrect or misstated or something that [he] felt wasn't considered that should have  


been."  Graham offered to submit a declaration he had prepared that summarized his  


experience and discussed the contingent nature of both personal injury and workers'  


compensation proceedings.  SEARHC did not object, although it was concerned that it  


would not "have means of questioning or challenging it." The declaration was admitted  


as evidence.  


                     The declaration briefly outlined Graham's experience, showing he had  


more than 35 years experience practicing law in multiple states.  Most of his work was  


in "representing personal injury and workers' compensation claimants on a contingent  


fee basis," and he estimated he had "formally represented hundreds of personal injury  


clients and dozens of worker[s'] compensation clients," including about 12 in Alaska.  


But he estimated he had "personally reviewed the status and the legal and factual issues  


of  more  than  500  Alaska  workers'  compensation  claimants"  in  over  20  years  of  


practicing in Alaska; had provided to many claimants "a number of hours" of time,  


mostly pro bono; and had "been very selective in entering [an] appearance" in workers'  


compensation cases, in part due to "the difficulties presented for earning a fee." Graham  


elaborated in his argument to the Board - which we treat as a proffer of the testimony  

           4         ICERS,  which  stands  for  Incident  and  Claims  Expense  Reporting  System,  

is   a   case   management   system.     Minutes,   Alaska   Workers'   Comp.   Bd.,   Workers'  

Compensation                  Board          Meeting            Minutes            at     2      (May          15-16,         2014),   

                                                                  -10-                                                            7422

----------------------- Page 11-----------------------

he             would                       have                   provided                             about                     his              experience                                 had                he             been                   permitted                              to  

testify - asserting that he had also practiced in "federal jurisdictions" and had "handled                                                                                                                                                                            

workers' compensation cases in Colorado, in New Mexico, and . . . in the federal system,                                                                                                                                                                                   

in . . . Federal Longshore[] & Harbor Workers' Compensation Act cases."  He said he   

had primarily represented personal                                                                                  injury claimants and drewparallels between the skills                                                                                                          

needed in personal injury and workers' compensation cases.                                                                                                                              

                                             Both Dockter and Rusch testified about the difficulties they encountered                                                                                                                                     

while representing themselves, expressed satisfaction with Graham's representation and                                                                                                                                                                                                  

the settlement of their cases, and recounted some of the work Graham did for them. The                                                                                                                                                                                                

Board first heard argument in Rusch's case, with the primary points of contention being                                                                                                                                                                                          

                                                                                         5  and the issues Rusch prevailed on.  The parties' arguments  

the complexity of the case                                                                                                                                                                                                                                      

in Dockter's case centered on the extent to which Dockter obtained any benefit from her  


attorney's efforts, with SEARHC taking the position that she had gotten no real gain  


from the settlement.   SEARHC expressed concern about Graham's billing methods,  


including his use of quarter-hour time increments.  


                                             Graham had anticipated testifying at the hearing about the time he spent  


following the initial fee affidavit, as the Board's regulation provides,6 but Hennemann  


told the hearing officer that "under the rules" Graham's "updated fee affidavits [were]  


due . . .  at the hearing," and the hearing chair apparently agreed.  No one identified the  


source of this "rule."  The Board left the record open so that Graham could submit a  


                       5                     AS   23.30.145(a)   provides that the Board should                                                                                                                           consider   "the nature,   

length, andcomplexityoftheservices                                                                                           performed"when                                              awarding attorney's fees. Under    

 8 Alaska Administrative Code (AAC) 45.180(d) (2011), the Board must consider these                                                                                                                                                                                                

same factors when awarding reasonable fees under AS 23.30.145(b).                                                                                                                          

                       6                      8 AAC 45.180(b) (allowing an attorney to "supplement the [initial fee]  


affidavit by testifying about the hours expended and the extent and character of the work  


performed after the affidavit was filed").  


                                                                                                                                           -11-                                                                                                                                    7422

----------------------- Page 12-----------------------

 supplemental fee affidavit for the time related to the hearing and SEARHC could submit                                                                                                                                                                                                                                                                 

detailed objections to Graham's affidavits of fees because SEARHC had not had the                                                                                                                                                                                                                                                                                      

opportunity to review the affidavits before filing its hearing briefs owing to deadlines set                                                                                                                                                                                                                                                                             

at the prehearing                                                             conference.     The Board                                                                                      allowed   the claimants to                                                                                         file seven-page   

responses to the objections, making the responses due by November 11.                                                                                                                                                                                                                                    

                                                          SEARHC   filed   lengthy   objections  in   both   cases   -   a   21-page   list   of  

objections with 23 exhibits and an affidavit in Dockter's case and a 31-page list of                                                                                                                                                                                                                                                                                       

objections with 32 exhibits and an affidavit in Rusch's case - and asked the Board to                                                                                                                                                                                                                                                                                       

reduce both the hourly fee requested and the total hours.                                                                                                                                                                                           The claimants filed responses                                                          

on   November   14,   the   first   business   day   following   Veteran's   Day,  a   state   holiday.   

 SEARHC objected that the responses were filed late and should be stricken.                                                                                                                                                                                                                                                           The Board   

rejected this argument.                                

                                                          The Board decided that Graham would be awarded an hourly rate of $300                                                                                                                                                                                                                                

an hour in both cases based on the Board's evaluation of the information it had gathered                                                                                                                                                                                                                                                        

about the workers' compensation cases in which Graham had entered an appearance.                                                                                                                                                                                                                                                                                                         

TheBoard                                      used information fromICERS, Westlaw,and the"Division'sLegal                                                                                                                                                                                                                               Database"  

to compile a table that listed select attorneys, their years of workers' compensation                                                                                                                                                                                                                                  

experience, the number of clients each had represented, and the hourly rates they had                                                                                                                                                                                                                                                                                

been awarded.                                                   The Board reduced the number of hours Graham billed in both cases in                                                                                                                                                                                                                                        

part because of his "billing methods," such as billing in quarter-hour increments and                                                                                                                                                                                                                                                                               

                                                                                       7           The Board  also  reduced  the  hours billed  because in  its view  

using block                                           billing.                                                                                                                                                                                                                                                                                                

Graham had spent too much time on some tasks; it additionally reduced his hourly rate  


based on the Board's assessment of his inexperience.  The Board faulted Graham for  


                             7                            Block billing consists of "billing entries that do not specify the time taken  


for each listed task but only give a total."  Nautilus Marine Enters., Inc. v. Exxon Mobil  


 Corp., 332 P.3d 554, 563 (Alaska 2014).  


                                                                                                                                                                                  -12-                                                                                                                                                                          7422

----------------------- Page 13-----------------------

failing to explain some entries, such as why he had traveled to Klawock to consult in                                                                                                                                                                                                                                

person with Rusch, what issue he discussed with her in a phone call, and which medical                                                                                                                                                                                                          

records he reviewed on certain dates.                                                                              

                                                 The   Board   disallowed   time   for   certain   tasks   because   in   its   view   the  

claimants were not successful on claims related to those tasks.                                                                                                                                                                                   The Board did not                                            

articulate the basis for its decisions about which issues the claimants prevailed on in their                                                                                                                                                                                                               

settlements.   The Board did not allow any time in either claim for the mediation brief on                                                                                                                                                                                                                          

attorney's fees because the Board deemed the document "unnecessary."                                                                                                                                                                                                     

                                                 The   Board   decided   that   some   tasks   Graham   had   billed   were   actually  

paralegal tasks, even though Graham argued in written materials that he had been unable                                                                                                                                                                                                             

to find a part-time paralegal and did not employ one.                                                                                                                                          The Board awarded Graham $130                                                                              

an hour for these tasks.                                                              Ultimately the Board reduced Graham's hours in Rusch's case                                                                                                                                                           

from 292.05 to 131.30 at the rate of $300, for a total attorney's fees award of $39,390.                                                                                                                                                                                                                                        

The Board awarded an additional .95 hour at a paralegal rate of $130 an hour.                                                                                                                                                                                                                                    In  

Dockter's case, the Board allowed 114.85 hours of attorney time - reduced from 194.5                                                                                                                                                                                                                    

hours - at $300 an hour and 2.45 hours of time as a paralegal cost at $130 an hour. The                                                                                                                                                                                                                       

Board indicated it was awarding fees under AS 23.30.145(b) in both cases, although it                                                                                                                                                                                                                                  


also discussed subsection (a) in Rusch's case.                                                                                                                              

                                                 The claimants appealed to the Commission. After a joint oral argument, the  


Commission affirmed both Board decisions in separate decisions.   The Commission  


declined to consider whether the Board had violated the claimants' due process rights by  


                         8                       Alaska Statute 23.30.145 authorizes attorney's fees to claimants' counsel  


in workers' compensation proceedings.  Under AS 23.30.145(a), the Board may order  


an employer to pay attorney's fees on the "compensation controverted and awarded."  


The Board is to award attorney's fees under AS 23.30.145(b) when an employer resists  


payment of compensation or other benefits and "the claimant has employed an attorney  


in the successful prosecution of the claim."  


                                                                                                                                                       -13-                                                                                                                                                7422

----------------------- Page 14-----------------------

prohibiting them from calling witnesses because that issue was beyond its jurisdiction.                                                                                                                                                                                                                                                                                                                                              

The   Commission   decided   the   presumption   of   compensability   did   not   apply   to   the  

question whether requested fees were reasonable and also determined the Board had not                                                                                                                                                                                                                                                                                                                            

abused   its   discretion   by   not   allowing   the   claimants   to   call   the   attorney   witnesses.   

According to the Commission, "the testimony of the proposed witnesses would not have                                                                                                                                                                                                                                                                                                                      

provided the Board with any information not already within its knowledge."                                                                                                                                                                                                                                                                                                        

                                                                 The Commission's legal discussion on the merits of the fees awarded in                                                                                                                                                                                                                                                                               

both cases focused on AS 23.30.145(a); it decided the amount of fees awarded was not                                                                                                                                                                                                                                                                                                                             

manifestly unreasonable. TheCommission                                                                                                                                                                       did not addresstheclaimants'                                                                                                                 arguments that  

because they settled their claims, the Board could not determine the issues they prevailed                                                                                                                                                                                                                                                                                         

on and that whatever factual findings the Board made about issues they lost were not                                                                                                                                                                                                                                                                                                                            

 supported by substantial evidence.                                                                                                                                     The Commission decided that substantial evidence                                                                                                                                                             

in the record supported the Board's findings, writing that "[t]here is no area of the Act                                                                                                                                                                                                                                                                                                                     

in which the Board has had more opportunity to investigate and decide an issue of fact                                                                                                                                                                                                                                                                                                                        

than that concerning attorney['s] fees."                                                                                                                                                      In the Commission's view, the Board properly                                                                                                                                             

decided Graham's requested hourly rate was "not justified" when compared to "more                                                                                                                                                                                                                                                                                                                

experienced attorneys," and it belittled his work in both cases.                                                                                                                                                                                                                                                     The Commission did                                                                         

nothing to disturb the Board's decisions, affirming the decisions related to Graham's                                                                                                                                                                                                                                                                                          

billing methods.                                                                 The claimants appeal.                                                    

III.                             STANDARD OF REVIEW                                                                      

                                                                 "In    an    appeal    from    the    Alaska    Workers'    Compensation    Appeals  

                                                                                                                                                                                                                                                                              9             "Whether  the  Commission  

Commission,   we   review   the   Commission's   decision."                                                                                                                                                                                                                                                                                                      

correctly applied the law in determining an award of attorney's fees is a question of law  




                                                                Burke v. Raven Elec., Inc., 420 P.3d 1196, 1202 (Alaska 2018).  

                                                                                                                                                                                                       -14-                                                                                                                                                                                                                    7422  

----------------------- Page 15-----------------------


that we review de novo."                         "We . . . apply our independent judgment to questions of                                           


constitutional law."                                                                                                                            

                                         "We independently review the Commission's conclusion that  


substantial evidencein the record supports the Board's factual findings by independently  

                                                                                     12   We also review the Commission's  



reviewing the record and the Board's findings." 

legal conclusions about the Board's exercise of discretion by "independently assess[ing]  


the Board's rulings."13                  The Board's "award of attorney's fees should be upheld unless  


it is 'manifestly unreasonable.' "14  


IV.         DISCUSSION  

                       We   recently   discussed   the   trade-off   that   underlies   the   workers'  


compensation system - "the grand bargain" - in which employees relinquish the right  


to sue for tort damages in exchange for limited but certain benefits and employers pay  


                                                                   15  One of the benefits retained by injured workers  

limited benefits without regard to fault.                                                                                                 


is the employer's payment of a worker's attorney's fees when the employer controverts  


or otherwise resists timely payment of compensation to which the worker is entitled.16  


Because the Alaska Workers' Compensation Act restricts the type of fee arrangement  


            10         D&D Servs. v. Cavitt                  , 444 P.3d 165, 168 (Alaska 2019) (quoting                                    Lewis- 

 Walunga v. Municipality of Anchorage                               , 249 P.3d 1063, 1066 (Alaska 2011)).                  

            11         Burke, 420 P.3d at 1202.  


            12         Humphrey v. Lowe's Home Improvement Warehouse, Inc., 337 P.3d 1174,  


 1178 (Alaska 2014).  


            13         Smith v. CSK Auto, Inc., 204 P.3d 1001, 1007 (Alaska 2009).  


            14          Williams v. Abood, 53 P.3d 134, 139 (Alaska 2002) (quoting Bouse v.  


Fireman's Fund Ins. Co., 932 P.2d 222, 241 (Alaska 1997)).  


            15         Burke, 420 P.3d at 1202.  


            16         AS 23.30.145(a)-(b).  


                                                                        -15-                                                                  7422

----------------------- Page 16-----------------------

between claimants and their attorneys,                    17 we have consistently construed the attorney's          

fees   provisions   of   the   Act   as   requiring   fees   awards   to   be   adequate   to   ensure   that  

                                                                                                 18   We  have  rejected  

competent  counsel   are   available   to   represent   injured   workers.                                            

attempts to tie the hourly fees paid claimants' counsel to the hourly fees for defense  


counsel.19       We have also weighed in some cases claimants' attorneys having received  


only partial fees "that may be dramatically lower than if the attorneys were compensated  


on an hourly basis" to justify higher fees for them than for defense counsel.20                                      We have  


observed that the objective of ensuring that competent counsel are available to represent  


injured workers "would not be furthered by a system in which claimants' counsel could  


receive nothing more than an hourly fee when they win while receiving nothing at all  


when they lose."21  


                    We  have  also  recognized  the  importance  to  claimants  of  adequate  


representation,  noting  that  "[w]ithout  counsel,  a  litigant's  chance  of  success  on  a  


                                                                          22  In the cases at bar the Commission  

workers' compensation claim may be decreased."                                                                  


          17        See  State,  Div.  of  Workers'  Comp.  v.  Titan  Enters.,  LLC,  338  P.3d  316,  323  

(Alaska  2014)  (summarizing  statutory  restrictions  on  claimants'  fee  arrangements).  

          18        See,  e.g.,  State,  Dep't  of  Revenue  v.  Cowgill,  115  P.3d  522,  524-25  (Alaska  


          19        Id. at 524-25.  


          20        Id. at 525.  


          21         Wise Mech. Contractors v. Bignell, 718 P.2d 971, 975 (Alaska 1986).  


          22        Bustamante  v. Alaska  Workers' Comp. Bd.,  59 P.3d  270,  274  (Alaska  


2002); see also Haile v. Pan Am.  World Airways, Inc., 505 P.2d 838, 844 (Alaska 1973)  


(Erwin, J., dissenting in part, concurring in part) (observing that "in a large number of  


claims, no counsel represents the claimant" and expressing concern "that the uneven  


position"  of unrepresented  claimants  "may work  to circumvent  the  purposes  of the  



                                                              -16-                                                        7422

----------------------- Page 17-----------------------

itself acknowledged the importance of representation, writing in both decisions that the                                                                                                                                                                                    

Board "is well awareofthe                                                            fact that represented claimants frequently                                                                                         aremore successful            

than unrepresented claimants before the Board, primarily because attorneys are skilled                                                                                                                                                                           

in collecting and presenting the kind of evidence necessary to succeed in a workers'                                                                                                                                                                  

compensation case."                                                 As we explain in more detail below, the decisions on appeal to us                                                                                                                                          

contain multiple errors and awarded an amount of attorney's fees to both claimants that                                                                                                                                                                                   

was manifestly unreasonable.                      

                      A.                   The Framework For Board-Awarded Attorney's Fees                                                                                                                           

                                           AlaskaStatute23.30.145(a) and (b) authorizetheBoardtoawardattorney's                                                                                                                                        

fees to an injured worker.                                                              We have observed that the subsections, while "construed                                                                                                   



separately, . . . are not mutually exclusive."                                                                                                      "[I]n a controverted case, the claimant is  


entitled to a percentage fee under subsection (a) but may seek reasonable fees under  



subsection (b)."                                           SEARHC controverted benefits in both cases, but it did not controvert  


all requested benefits in Dockter's case, as it did in Rusch's.  


                                           The claimants in both cases sought fees under Alaska Statute 23.30.145(b),  


which requires the Board to award a claimant "the costs in the proceedings, including  


reasonable attorney['s] fees . . . in addition to the compensation or medical and related  


benefits ordered" when an employer resists payment of compensation.   SEARHC's  


Board hearing briefs cited AS 23.30.145(a), which has a provision about minimum fee  

                      22                   (...continued)  


compensation act").  

                      23                   Circle De Lumber Co. v. Humphrey, 130 P.3d 941, 952 n.76 (Alaska 2006)  


(internal citation omitted).                           

                      24                   Id.  

                                                                                                                                     -17-                                                                                                                             7422

----------------------- Page 18-----------------------


awards;                    SEARHCalso discussed awards of reasonable fees in addition to the minimum                                                                                                                   


                                      TheBoard                     and theCommissionciteddifferent statutory                                                                                 subsections in their                     

analyses, but neither party raised this as an issue before us.                                                                                                             The Board's regulations                

employ the same standards to fees requested under AS 23.30.145(b) and requests for fees                                                                                                                                                 


in excess of the statutory minimum under AS 23.30.145(a).                                                                                                                     

                                      We have consistently construed AS 23.30.145 "in its entirety as reflecting  


the legislature's intent that attorneys in compensation proceedings should be reasonably  


compensated for services renderedto acompensation claimant."27  Given our recognition  


that  reasonable  fees  can  be  awarded  in  addition  to  statutory  minimum  fees  under  


 subsection (a), we see no reason to distinguish between the subsections in setting out the  


factors the Board needs to consider in awarding reasonable attorney's fees.  


                   25                AS 23.30.145(a) provides in part that "the fees may not be less than 25                                                                                                                               

percent on the first $1,000 of compensation or part of the first $1,000 of compensation,                                                                                                                  

and 10 percent of all sums in excess of $1,000 of compensation." The Board said Rusch                                                                                                                                            

was entitled to attorney's fees under AS 23.30.145(a), but concluded by saying her                                                                                                                                                      

attorney would "be awarded . . . fees under AS 23.30.145(b)."                                                                                                                 It used AS 23.30.145(b)         

consistently in Dockter's case.                                         

                   26                 8 AAC 45.180(b), (d); cf. Lewis-Walunga v. Municipality of Anchorage,  


A W C A C                                  D e c .                      N o .                   1 2 3                   a t               8 - 9                  ( D e c .                       2 8 ,                 2 0 0 9 ) , in Board's  


affidavit requirements for attorney's fees under AS 23.30.145(a) and (b)).  


                   27                Rose v. Alaskan Vill., Inc., 412 P.2d 503, 509 (Alaska 1966); accord State,  


Dep't of Revenue v. Cowgill, 115 P.3d 522, 524-25 (Alaska 2005); Bailey v. Litwin  


 Corp., 780 P.2d 1007, 1011 (Alaska 1989); Wise Mech. Contractors v. Bignell, 718 P.2d  


971, 973 (Alaska 1986);  Whaley v. Alaska Workers' Comp. Bd., 648 P.2d 955, 959  


(Alaska  1982)  ("AS  23.30.145  is  unique  in  its  generosity  to  claimants  and  their  



                                                                                                                    -18-                                                                                                            7422

----------------------- Page 19-----------------------

                                When setting the reasonable attorney's fees in these cases, the Board made                                                                                        

findings related to two distinct questions:                                                         an hourly rate for Graham's services and the                                                        

number   of hours it determined                                                were reasonable for                                specific tasks.                        The amount of                   

reasonable fees was the product of multiplying these numbers.  The method used here                                                                                                                 

is not the same method the Board used in cases we have reviewed in the past.                                                                                                                         For  

example, in                    Circle De Lumber Co. v. Humphrey                                                          , the Board increased the statutory                             

minimum fees by a percentage, awarding the claimant "attorney's fees of thirty-five                                                                                                   

                                                      28     On the other hand, in Bailey v. Litwin Corp. the Board first  

percent of the award."                                                                                                                                                                               

calculated  a reasonable fee and  then adjusted  that fee using  several factors.29                                                                                                                  The  


Board's regulation sets out factors the Board must consider in awarding fees but does not  


say how those factors are to be applied to a request for fees.30  Neither party discussed  


whether the method used here is a standard method the Board currently uses to determine  


fees, nor did either party dispute that this was an appropriate method, so we do not  


discuss the issue further.  We now turn to the issues presented on appeal.  


                B.	 	           The Commission Erred In Affirming The Board's Analysis About The  


                                Issues On Which The Claimants Prevailed.  


                                Attorney's fees in workers' compensation cases are awarded to successful  




                              and the parties here disputed which issues the claimants prevailed on.  In  

                28	 	            130 P.3d at 953.                        

                29              780 P.2d at 1011-12. The method used in                                                           Bailey  is similar to the "modified                  


lodestar"  approach  we  recently  adopted  for  Unfair  Trade  Practices  and  Consumer  

Protection Act cases.                               See Adkins v. Collens                                , 444 P.3d 187, 200 (Alaska 2019).                                   

                30 	            8 AAC 45.180(b), (d).  


                31              AS 23.30.145(a) permits an award of fees on benefits that are controverted  


and awarded. We have interpreted AS 23.30.145(b) as requiring success on a claim, not  


solely on collateral issues.  Adamson v. Univ. of Alaska , 819 P.2d 886, 895 (Alaska  


                                                                                                   -19-	                                                                                           7422

----------------------- Page 20-----------------------

both cases SEARHC argued that the claimants were not successful on certain claims and                                                                                                                                                                                                                                                                               

 issues and thus should not be awarded attorney's fees for related work. The Board found                                                                                                                                                                                                                                                                  

that Dockter "prevailed on the primary dispute," the partial knee replacement, but said                                                                                                                                                                                                                                                                          

Dockter   had   not   succeeded   on   a   compensation   rate   adjustment   claim.     It   did   not  

 otherwise discuss her success, even though her written claim sought other relief.                                                                                                                                                                                                                                                                             The  

Board decided Rusch was entitled to fees "for services provided on medical benefits,                                                                                                                                                                                                                                                         

 TTD and reemployment benefits" but that she did not prevail on the following issues:                                                                                                                                                                                                                                                                                                   

 "interference with selection of physician, improper influence of physician's medical                                                                                                                                                                                                                                                           

 opinion,   unemployment   benefits,   excessive   change   of   physician,   and   the   ethics   of  

 attorney fee negotiation in mediation." It did not offer a rationale for its decisions about                                                                                                                                                                                                                                                               

 success, nor did it explore how the non-monetary issues might have impacted Rusch's                                                                                                                                                                                                                                                            

 success on her monetary claims.                                                                            

                                                          Theclaimants                                                argueon appeal that                                                                  becausetheir casesendedinsettlements,                                                                                 

they should be awarded attorney's fees for all of their claims unless the issue bargained                                                                                                                                                                                                                                               

 away "lacked merit or was without legal or factual basis."                                                                                                                                                                                                They rely on                                                Singh v. State                        

Farm Mutual Automobile Insurance Co.                                                                                                                                            , where we adopted from federal law a test to                                                                                                                                             

                                                                                                                                                                                                                                                                                                                    32            SEARHC's  

 determine prevailing party status in civil rights litigation in state court.                                                                                                                                                                                                                                                 

response is that the claimants did not articulate a standard for "awarding fees  in  a  


 settlement context."  


                                                          We have not been faced with the question how to determine a workers'  


 compensation claimant's success for purposes of awarding attorney's fees when other  


 claims were settled.  In a contested case, the Board resolves more than just monetary  


                             31                           (...continued)  


                             32                           860 P.2d 1193, 1198 (Alaska 1993).                                                                                             

                                                                                                                                                                                  -20-                                                                                                                                                                         7422

----------------------- Page 21-----------------------

claims; it may decide procedural or evidentiary issues that can impact the ultimate                                                                 

outcome of the claim.                      For example, if the Board finds that a party changed physicians                                      

                                                                                                                                          33   The Board  

too many times, the Board cannot consider the opinions of those doctors.                                                                                

                                                                                                                     34   Excessive changes of  

can also sanction a party for disobeying its discovery orders.                                                                                                  


physician and discovery disputes were at issue here, and while the cases settled before  


the issues were fully developed and decided, the Board decreased some of Graham's fees  


for work on these issues.   Rusch additionally alleged that the insurer made multiple  


misrepresentations and engaged in unfair claimsettlement practices aswell asinterfering  


with  her  medical  care;  these  allegations  were  connected  to  her  claim for  unfair  or  


frivolous controversion. Rusch acknowledged in her mediation brief that these were not  


"claim[s], per se" with an easily identified value, but she argued that were she to prevail  


on these issues, her chances of success on her monetary claims would "substantially  




                         We agree with the claimants that the Board should use an analysis similar  


to the one we adopted in Singh to evaluate a claimant's success on an issue in a workers'  


compensation  settlement.                            Singh,  like  this  case,  involved  a  fee-shifting  statute  that  


allowed reasonable attorney's fees to be awarded to a prevailing party, and like this case,  


the underlying litigation was resolved through a settlement.35                                                             The parties disputed  


whether the plaintiff had prevailed in the underlying suit, with the defendants implicitly  


contending that "a settling litigant should not become eligible for . . . attorney's fees by  


             33          8  AAC  45.082(c)  (2019).  

             34          AS  23.30.108(c).  

             35          Singh,  860  P.2d  at   1197.   

                                                                              -21-                                                                        7422

----------------------- Page 22-----------------------


merely reciting an otherwise frivolous . . . civil rights claim in his complaint."                                                                      To  

resolve this issue, we adopted a test from the Fifth Circuit that "places the burden on the                                                              

party opposing attorney's fees to show lack of merit."                                            37  


                        Before the Board SEARHC discounted the claimants' success and the  


connection  between  their  attorney's  efforts  and  the  settlement  amounts.                                                               Because  


workers' compensation attorney's fees awards are in some ways analogous to other fee- 


shifting statutory schemes, we adopt the test from Singh  for purposes of evaluating  

                                                                                           38   Thus, in a workers' compensation  


whether a claimant was successful in a settlement. 

settlement  where  the  parties  dispute  the  issues  on  which  a  claimant  prevailed  for  


purposes of attorney's fees, the employer "who contends that [its] conduct was a wholly  


gratuitous  response  to  a  [claim]  that  lacked  colorable  merit,  must  demonstrate  the  


worthlessness of the . . . claim[] and explain why [it] nonetheless voluntarily gave the  



[claimant] the requested relief." 


                        Here  SEARHC  asserted  that  "Dockter  fail[ed]  in  her  insistence  for  


preauthorization" of the partial knee replacement and gained no more in TTD than it had  


offered in 2015. And in Rusch's case SEARHC claimed that the litigation "involved an  


honest dispute regarding two doctor bills totaling about $500" and that "most of the  


            36          Id.  at   1198.  

            37          Id.  

            38          In  Whaley  v.  Alaska  Workers'  Compensation  Board,  we  adopted  a  test  from  

federal  civil  rights  law  when  construing  former  Alaska  Appellate  Rule  508,  requiring  a  

showing that  the  claimant's  position  "was  frivolous,  unreasonable,  or  brought  in  bad  

faith."   648  P.2d  955, 960 & n.8 (Alaska 1982) (citing  Christiansburg  Garment  Co.  v.  

EEOC,  434  U.S.  412,  422  (1978)).  

            39          Singh, 860 P.2d at 1198 (quoting Hennigan v. Ouachita Par. Sch. Bd., 749  


F.2d 1148, 1153 (5th Cir. 1985)).  


                                                                           -22-                                                                     7422

----------------------- Page 23-----------------------

issues raised during [Graham's] representation completely lacked a factual basis and did                                                                                                                                                                                                                                                                                                                                                                                                  

not result in any gain through settlement."                                                                                                                                                                                                        On remand SEARHC will have the burden                                                                                                                                                                            

 of showing why it settled both claims in excess of $100,000 if they were so lacking in  


                                                                            We emphasize that the underlying, non-monetary issues, such as the ethics                                                                                                                                                                                                                                                                                                                       

issue and what the Board called "unemployment benefits," should be analyzed in the                                                                                                                                                                                                                                                                                                                                                                                                        

 same manner. The Board decided the claimants had not succeeded on what it called "the                                                                                                                                                                                                                                                                                                                                                                                               

 ethics of attorney fee negotiation in mediation" and disallowed any time on that issue.                                                                                                                                                                                                                                                                                                                                                                                                                           

The Commission said, "Neither the Board nor the settlement agreement addressed this                                                                                                                                                                                                                                                                                                                                                                                                    

issue, so it was not an issue for which fees could be awarded."  SEARHC's mediation   

brief in Dockter's case indicated that Graham told Hennemann he wanted "to negotiate                                                                                                                                                                                                                                                                                                                                                                    

 all   of   Ms.   Dockter's   claim   but   for   fees   first   and   when   all   preliminary   issues   are  

 addressed, then negotiate the issue of fees" and that she informed him that this procedure                                                                                                                                                                                                                                                                                                                                                        

was "not acceptable to [her] clients."                                                                                                                                                                                  The attorney's fees dispute was separated from                                                                                                                                                                                                          

negotiation of other claims, so it is hard to understand the agencies' decisions that the                                                                                                                                                                                                                                                                                                                                                                                                 

 claimants did not succeed on that issue.                                                                                                                                                       

                                                                            Both the Commission and the Board faulted Graham for research related                                                                                                                                                                                                                                                                                                                    

                                                                                                                                                                                                                                                                                                     40  but she argued that her eligibility  

to SEARHC's termination of Rusch's employment,                                                                                                                                                                                                                                                                                                                                                                                                      

 for TTD, and consequently her potential entitlement to reemployment benefits, was  


                                      40                                    The    Commission    wrote    that  the    Board    correctly    "discounted"    the  

 "considerable   time"   billed   for   a   "wrongful   termination"   claim.     SEARHC's   list   of  

 objections to Graham's attorney's fee affidavit does not mention any time billed for a                                                                                                                                                                                                                                                                                                                                                                                                              

wrongful termination claim, nor did the Board mention a wrongful termination claim.                                                                                                                                                                                                                                                                                                                                                                                                                                

 SEARHC asserted at the Board hearing that Graham "spent hours and hours and hours                                                                                                                                                                                                                                                                                                                                                                                          

 of time evaluating a potential wrongful discharge claim," but we have found nothing in                                                                                                                                                                                                                                                                                                                                                                                                          

the record to substantiate this assertion.                                                                                                                               

                                                                                                                                                                                                                                            -23-                                                                                                                                                                                                                                  7422

----------------------- Page 24-----------------------


related to the loss of her job                                              (which she alleged                              was due to her continued lifting                                

restrictions) and her receipt of unemployment.                                                                Rusch offered in her amended claim to                                                   


repay all unemployment benefits she had received so that she could receive TTD.                                                                                                                              


Because reemployment eligibility is tied to the employee's inability to return to her  

                                                                              43  Rusch's termination and the reasons for it were not  


employment at the time of injury, 

wholly unrelated to her reemployment claim. SEARHC's stated reasons for terminating  


Rusch's employment was one basis for her assertion that SEARHC had committed an  


unfair claim settlement practice; she argued that the misrepresentation affected her TTD  


and reemployment eligibility.  The Board should also consider the discovery issues that  


it did not have to resolve because of the settlement, such as SEARHC's redaction of  


documents and its failure to file all medical reports, and the impact of these issues on the  


amount of fees.  


                C.	 	          ExperienceInAlaska Workers'CompensationIs NotTheOnly Factor  


                               Relevant To An Attorney's Hourly Rate.  


                               We turn now to the question of assessing a reasonable fee.  A main point  


of contention in these cases was Graham's hourly rate.  He requested $425 an hour and  


told  the  Board  that  it  had  approved  an  hourly  rate  of  $350  in  other  workers'  


compensation cases he had settled.  Graham's proposed rate was based on his 35 years  


of experience in personal injury and workers' compensation, including brief service  


                41             A chronology Graham prepared for the mediation, evidently based in part                                                                                            

on discovery SEARHC provided, suggests that SEARHC's adjuster was aware of this                                                                                   

problem:   the chronology shows an email from the adjuster to SEARHC asking why                                                                                                                 

Rusch had been laid off and noting they might "have to pay her TTD."                                                                                   

                42             See Alyeska Pipeline Serv. Co. v. DeShong, 77 P.3d 1227, 1233-37 (Alaska  


2003) (affirming Board decision awarding claimant TTD if she repaid unemployment  


benefits received during time that TTD was contested).  


                43 	           AS 23.30.041(c), (e).  


                                                                                                 -24-	                                                                                         7422

----------------------- Page 25-----------------------

work he had done in cases where he did not enter an appearance, as well as the fees he                                                        

was   able   to   earn   in   other   litigation   in   Southeast   Alaska.     The   claimants   presented  

argument and proposed findings to the Board on factors set out in                                                    Wise Mechanical   

                                       44 of those factors, the claimants contended that only the nature  

Contractors v. Bignell;                                                                                          

and length of the professional relationship with the client was not relevant.  SEARHC  

maintained that Graham should be awarded no more than $275 an hour because in its  


view Graham had "limited experience in Alaska Workers' Compensation matters"; it  


characterized his requested hourly rate as "truly egregious."  At the hearing SEARHC  


argued that our precedent allowed what it called "enhanced fees" only "based upon an  


attorney's experience in the field of workers' compensation."  


                      The Board evidently agreed with SEARHC: it refused to permit testimony  


about Graham's experience as an attorney because of relevance, and it later wrote that  


Graham's   "experience   representing   claimants   in   civil   litigation   and   workers'  


compensation cases in other states has no weight in determining his hourly rate and will  


notbeconsidered." TheCommission affirmedtheBoard'sdecision, writing, "TheBoard  


measured [the claimants'] attorney's experience and expertise against more experienced  


attorneys and came to a decision supported by the evidence that the hourly rate sought  


was not justified."  The Commission did not provide any legal reason why Graham's  


experience in other civil litigation or in other states' workers' compensation cases was  


not relevant.  


                       On  appeal  the  claimants  contend  that  experience  in  Alaska  workers'  


compensation law, while relevant, should not be the sole criterion used to establish an  


attorney's hourly ratebecausemanytasks performed in workers' compensation cases are  




                       718 P.2d 971, 974 n.7 (Alaska 1986) (listing factors from Alaska Code of  


Prof. Resp. DR 2-106(B)).  

                                                                     -25-                                                                     7422  

----------------------- Page 26-----------------------

"no  different from the work                                                                                   done by                           attorneys in                                     other   areas of litigation."                                                                         They  

maintain that the Commission acted arbitrarily in endorsing the Board's approach and   

deprived them of due process. The claimants point out that the Board's approach favors                                                                                                                                                                                                                  

attorneys in the Anchorage area because of the smaller number of claims in other areas                                                                                                                                                                                                                     

of the state.                               SEARHC argues that the Board's hourly fee award was correct because of                                                                                                                                                                                                     

the specialized nature of workers' compensation law.                                                                                                                                                While SEARHC frames the issue                                                                           

as one of substantial evidence, it is difficult to square SEARHC's argument that there                                                                                                                                                                                                                      

was a failure of substantial evidence in the face of SEARHC's successful efforts to                                                                                                                                                                                                                                   

precludewitnesses who could have provided the very evidence SEARHCcomplains was                                                                                                                                                                                                                                  


                                                 As set out above, the agencies did not cite the same statutory subsection for                                                                                                                                                                                      

the   fees   award,   but   both   applied   a   reasonable   fees   analysis  rather  than   discussing  

 statutory minimum fees.                                                                   The statutory and regulatory factors for awarding fees include                                                                                                                                          

                                                                                                                                                                                             45                                                                                         46  and "the  

                                                                                                                                                                                                     the amount of benefits,                                                                                   

"the nature, length, and complexity of the services,"                                                                                                                                                                                                    

                                                                                                                                             47          Nothing in the regulation or statute ties an  

benefits resulting from the services."                                                                                                                                                                                                                                                                              


attorney's hourly rate solely to his experience in Alaska workers' compensation law.  


Neither the Commission nor the Board cited any precedent or agency decisions to justify  


the exclusive use of experience in Alaska workers' compensation law when determining  


a reasonable hourly rate.  The Commission, like SEARHC, viewed the issue as one of  


                         45                      AS23.30.145(a);8AAC45.180(d)(2) (setting out Board considerations                                                                                                                                                                                                 for  

fees under AS 23.30.145(b)).                          

                         46                      See  AS  23.30.145(a)  (allowing  attorney's  fees  on  "the  amount  of  


compensation controverted and awarded"); 8 AAC 45.180(d)(2) (listing "the amount of  


benefits involved" as a factor for fees under AS 23.30.145(b)).  


                         47                      AS 23.30.145(a); 8 AAC 45.180(d)(2).  


                                                                                                                                                        -26-                                                                                                                                                 7422

----------------------- Page 27-----------------------

discretion and fact finding, even though the claimants made arguments similar to the                                                                             

ones they have briefed on appeal to us.                                      

                          We have not in our precedent limited the Board to considering only Alaska                                                       

workers' compensation experiencein                                      attorney's fees awards. To                        thecontrary,             in  Bignell,  

we   set   out  all   the   factors   in   what   was   then   the   Alaska   Code   of   Professional  

                                                                                                                                              48     In  State,  

Responsibility   governing   determinations   of   reasonable   attorney's  fees.                                                                          

Department of Revenue v. Cowgill, we expressly rejected an employer's attempt to tie  


Board-awarded attorney's fees for claimants to "[t]he hourly rates of the equivalently  


experienced defense counsel."49                                 We also expressly rejected in Cowgill the employer's  


request to "revisit" Bignell, and we refused to adopt a rule requiring an "individualized  


inquiry" about the necessity of "enhanced compensation" in workers' compensation  




                          To clarify our holding in Bignell, we hold that the Board must consider all  


of the factors set out in Alaska Rule of Professional Conduct 1.5(a) when determining  


                                                     51   Those factors are virtually the same as the ones set out in  

a reasonable attorney's fee.                                                                                                                                       


             48           718  P.2d  at  974  &  n.7.  

             49           115  P.3d  522,  524  (Alaska  2005).  

             50           Id.  at  527.  

             51           Alaska  Rule  of  Professional  Conduct   1.5(a)  sets  out  eight  non-exclusive  

"factors  to  be  considered  in  determining  the  reasonableness  of  a  fee,"  specifically:  

                                       (1)   the   time   and   labor   required,   the   novelty  and  

                          difficulty  of  the  questions  involved,  and  the  skill  requisite  to  

                          perform  the  legal  services  properly;  

                                       (2)  the  likelihood,  that  the  acceptance  of  the  particular  

                          employment  will  preclude  other  employment  by  the  lawyer;  


                                                                               -27-                                                                          7422

----------------------- Page 28-----------------------


Bignell            and must guide the Board's analysis of the reasonableness of requested fees.                                                                                      

Some factors mirror those set out in the Act, such as the amount involved and the results                                                                             

obtained.   On remand, the Board must consider each factor and either make findings                                                                               

related to that factor or explain why that factor is not relevant.                                             

                            We underscored in                         Bignell   the importance of the contingent nature of                                                     

                                                                                    53  yet neither the Board nor the Commission  

workers' compensation attorney's fees,                                                                                                                   

discussed how it applied the contingency factor to these cases.  The Board mentioned  


contingency as a factor in the sentence immediately before it lowered Graham's hourly  


rate to $300.  On remand the Board needs to explain how decreasing Graham's hourly  


fee is consistent with the contingent nature of workers' compensation attorney's fees, if  


it again decreases his hourly rate.  


              51            (...continued)  


                                          (3)  the  fee  customarily  charged  in  the  locality  for  


                            similar legal services;  


                                          (4) the amount involved and the results obtained;  


                                          (5) the time limitations imposed by the client or by the  



                                          (6)   the   nature   and   length   of   the   professional  


                            relationship with the client;  


                                          (7) the experience, reputation, and abilityofthe lawyer  


                            or lawyers performing the services; and  


                                          (8) whether the fee is fixed or contingent.  

              52            Compare id., with Bignell, 718 P.2d at 974 n.7 (quoting Alaska Code Prof.  


Resp. DR2-106(B)).  


              53            Bignell, 718 P.2d at 975 (expressly including "the contingent nature of  


counsel's right to compensation" in factors the Board must use when awarding fees).  


                                                                                     -28-                                                                                7422

----------------------- Page 29-----------------------

                                                   The   Commission   also   did   not   discuss   why   the   Board   was   justified   in  

 considering only those workers' compensation cases in which Graham had entered an  

 appearancerather than the cases in which headvised claimants or helpedself-represented                                                                                                                                                                                   

 litigants   navigate   the   system.    The   Board   measured   Graham's   Alaska   workers'  

 compensation experiencebasedonly on informationfromitsdatabases,which apparently                                                                                                                                                                                                             

revealed that Graham had entered appearances in 20 Alaska workers' compensation                                                                                                                                                                                                 

 cases.    The Board did not discuss the statement in Graham's declaration that he had                                                                                                                                                                                                                                 

provided assistance without a formal entry of appearance in numerous other Alaska                                                                                                                                                                                                                         

workers' compensation cases.                                                                                            The agencies' failure to consider this                                                                                                                   evidence was   

 erroneous, particularly in light of their narrow focus on an attorney's experience in this                                                                                                                                                                                                                             

 area of law.                                 

                                                   Werecognizethat Alaska workers' compensation law is a                                                                                                                                                           specialized field,   

 and we do not mean that experience in that field cannot be taken into account.  But an                                                                                                                                         

 attorney's experience in related legal fields, such as administrative law, occupational                                                                                                                                                                         

 disability law, or personal injury law, should be relevant as well.                                                                                                                                                                                      Here, for example,                      

 Graham's experience as a trial attorney appears to have given him an understanding of                                                                                                                                                                                                                                       

what constitutes evidence.                                                                             And we see no reason that experience in other states' or                                                                                                                                                             

 federal workers' compensation law would not be relevant to an attorney's reasonable                                                                                                                                                                                                        

                                            54        The Board's regulation expressly authorizes awards of attorney's fees to  

hourly rate.                                                                                                                                                                                                                                                                                                                  

                          54                       We have relied on cases decided under the federal Longshore and Harbor  


Workers' Compensation Act in the past because our Act was "modeled" on it. McCarter  


 v. Alaska Nat'l Ins. Co. , 883 P.2d 986, 990 n.5 (Alaska 1994); see, e.g., Fischback &  


Moore of Alaska, Inc. v. Lynn, 453 P.2d 478, 483-84 (Alaska 1969) (deciding that federal  


 case law was "dispositive" of legal issue because of substantial similarity  between  


 federal statute and Alaska Act).  


                                                                                                                                                           -29-                                                                                                                                                    7422

----------------------- Page 30-----------------------


attorneys licensed in other states.                                It is hard to see why these attorneys' experience               

practicing  workers'   compensation   in   their   own   states   could   not   be   considered   in  

determining their reasonable fees in an Alaska case.                                             Finally, there is a general body of                        

workers' compensation law.  General principles of workers' compensation law are set   

                                                                                    56  a treatise cited by us,57  by the workers'  

out in Larson's Workers' Compensation Law,                                                                                                      

compensation agencies,58  and by workers' compensation attorneys.59                                                               It was therefore  


legal error to discount completely Graham's experience in workers' compensation in the  


federal system and in other states.  


            D.           The Board Denied The Claimants Due Process.  


                         The claimants argue that the Board violated their due process rights by not  


allowing them to call witnesses and by using "the Board's proprietary data" without  


giving them an opportunity to address this information.  They point out that the Board  


reduced Graham's hours because he did not explain some entries, yet he was unable to  


explain those entries (or answer other questions the Board or SEARHC might have had)  


because the Board disallowed his testimony.  SEARHC responds that the Board did not  


            55           8 AAC 45.180(b), (d).              

            56           ARTHUR  LARSON ET AL                       ., L  ARSON 'S  WORKERS' C                    OMPENSATION  LAW  (rev.  


ed. 2015).  

            57           See, e.g., Anderson v. Tuboscope Vetco, Inc. , 9 P.3d 1013, 1017 (Alaska  


2000) (adopting three-part test for special employment from Larson's treatise).  


            58           See, e.g., Warnke-Green v. Pro West Contractors, LLC, AWCAC Dec. No.  


235 at 12 (June 26, 2017),;  


Kolb  v.  Walmart  Assocs.,  Inc.,  AWCB  Dec.  No.  16-0099  at  11  (Oct.  28,  2016),  


            59           See, e.g., Unisea, Inc. v. Morales de Lopez, 435 P.3d 961, 971, 973 (Alaska  


2019) (summarizing employer's argument based on Larson's treatise).  


                                                                            -30-                                                                      7422

----------------------- Page 31-----------------------

violate due process, viewing the exclusion of the witnesses' testimony as a proper                                                                         

exercise of the Board's discretion.                                 The Commission did not reach this issue because of                                               

limits on its jurisdiction.                     60  


                          "Due process requires the'opportunity to be heard at a meaningful time and  

                                                           61      Procedural  due  process  applies  in  administrative  


in  a  meaningful  manner.'  " 

proceedings, including workers' compensation hearings.62                                                            "We have concluded that a  


party's due process rights are violated when the record is supplemented with a new  


rationale to which the party was not able to respond."63                                                       We have also decided that an  


administrative agency violated a party's due process rights by not allowing her the  


opportunity to rebut evidence produced after a hearing when the final decision in the case  


rested both on that evidence and on a new legal issue that had not been previously  



                          Here the Board did not allow Graham to testify but then reduced hours for  


certain tasks because he either did not explain why the tasks were necessary or had not  


provided a level of detail in his affidavit that the Board later deemed necessary.  The  


             60           See Alaska Pub. Interest Research Grp. v. State                                              , 167 P.3d 27, 36 (Alaska           

2007)    ("Administrative    agencies    do    not    have    jurisdiction    to    decide    issues    of  

constitutional law." (citing                         Dougan v. Aurora Elec., Inc.                            , 50 P.3d 789, 795 n.27 (Alaska              


             61           Matson v. State, Commercial Fisheries Entry Comm'n, 785 P.2d 1200,  


 1206 (Alaska 1990) (quoting Mathews v. Eldridge, 424 U.S. 319, 333 (1976)).  


             62           Barrington v. Alaska Commc'ns Sys. Grp., Inc., 198 P.3d 1122, 1132  


(Alaska 2008).  


             63           Heustess v.  Kelley-Heustess,  259  P.3d  462,  477  (Alaska 2011)  (citing  


Matson, 785 P.2d at 1206).  


             64           Bostic v. State, Dep't of Revenue, Child Support Enf't Div., 968 P.2d 564,  


569-70 (Alaska 1998).  


                                                                                -31-                                                                           7422

----------------------- Page 32-----------------------

Board's regulations require "an affidavit itemizing the hours expended as well as the                                                                                                         


extent and character of the work performed."                                                                             

                                                                                                              The regulation provides no additional  

                                                                                            66     The Board did not inform Graham that his  



guidance about the form of an affidavit. 

affidavit was inadequate at the hearing, even though SEARHC commented in its hearing  


brief  that  it  "anticipated"  Graham  would  use  quarter-hour  billing  "rather  than  the  


customary tenth of an hour billing," nor did the Board allow him an opportunity to  


modify the affidavit before issuing its decision.  We agree with the claimants that the  


Board's actions here violate due process by reducing their attorney's fees without either  


providing adequate notice about the information they needed to present to preserve their  


claims or allowing them to present evidence to address the reasons for lowering their  




                              Turning to the use of the Board's database, the Board consulted ICERS to  


gather evidence related to Graham's experience - evidently after the hearing because  


the Board chair said the information was "not available right now" when Graham asked  


at the hearing to see the evidence so that he could argue about it.  The Board chair told  


him  he  could  ask  for  reconsideration  of  its  decision  if  he  thought  something  was  


incorrect in or improperly excluded from its decision.   When discussing the related  


question of abuse of discretion in not allowing the attorney testimony, the Commission  


thought theBoard had "within itsdatabasesufficientinformation"to establishreasonable  


attorney's fees without hearing from the attorney witnesses, including Graham.  


               65              8 AAC 45.180(d)(1).     

               66             It does not, for example, require the use of a specific time increment in                                                                                          

billing, nor does it forbid block billing.                                                 8 AAC 45.180.                         As an example of the level of                                  

detail the Board demanded, it reduced Graham's hours because he did not "state which                                                                                                   

issue   the   medical   records   and   research   addressed"   when   he   claimed   hours   spent  

reviewing medical records and researching them. It     also faulted himfor                                                                                      not "provid[ing]  

the issue or benefit addressed" in phone calls to his clients.                                                        

                                                                                              -32-                                                                                       7422

----------------------- Page 33-----------------------


                    We conclude that the Board's use of the extra-record information without  


providing the claimants an opportunity to see and respond to it before the Board made  


its decision violated due process.  The Board's past decisions may have information  


about the hourly fees awarded to attorneys, but the Board has no regulation tying a  


certain number of clients or years of practice to a specific hourly fee - in short, it has  


no regulation explaining howexperience in workers' compensation is measured and how  


that experience is used to arrive at a reasonable hourly fee.  


                    Graham submitted a declaration, which the Board admitted as evidence,  


estimating that he had "reviewed the status and the legal and factual issues of more than  


500 Alaska workers' compensation claimants over thelast 20 years"; the declaration also  


provided  an  estimate  of  the  number  of  cases  in  which  he  had  either  entered  an  


appearance  or  participated  in  a  hearing.                        The  Board  did  not  allow  Graham  the  


opportunity to argue how his experience was similar to or different fromthat of attorneys  


listed in the Board's table, which showed rates it had approved for certain attorneys in  


the past, because the Board created the table after the hearing.  The Board used extra- 


record judicial facts to make an individualized decision without providing the claimants  


an opportunity to confront the evidence, dispute its accuracy, or argue about it.  This  


violated their rights to due process.  


                    The Board and the Commission justified the use of ICERS and the lack of  


notice to the claimants by citing our decision in Fairbanks North Star Borough v. Rogers  


& Babler, where, in summarizing how we review questions of fact on appeal, we stated,  


"The Board may base its decision not only on direct testimony, medical findings, and  


other tangible evidence, but also on the Board's experience, judgment, observations,  

                                                              -33-                                                         7422

----------------------- Page 34-----------------------


unique or peculiar facts of the case, and inferences drawn from all of the above."                                                                                                       


Rogers & Babler cannot be read as broadly as the agencies did here, and it does not, as  


 SEARHC contends, allow the Board to use "institutional experience" derived from its  


database as evidence to decide disputed facts without giving parties an opportunity to  


rebut that evidence.  The point of our statement, derived from Beauchamp v. Employers  


Liability Assurance Corp., was that administrative adjudicators' expertise gained from  

repeated exposure to information in adjudications can support conclusions made from  



the evidence presented in a specific case. 

                            In sum,  the Board violated the claimants' due process rights by using  


information fromits database without providing an opportunity to rebut that information  


and by reducing hours without adequate prior notice that the affidavits did not meet an  


unwritten standard.  It also violated due process by failing to provide adequate notice  


about what information the Board would use to evaluate their fee requests and by not  


providing them an opportunity to present evidence to support the reasonableness of the  


requested fees.  


              E.	 	         The Board Abused Its Discretion By Not Allowing Testimony From  


                            The Other Witnesses.  


                            The claimants contend that they had a statutory right to call witnesses at the  


hearing and that the Board abused its discretion when it excluded all of the attorney  


              67             747 P.2d 528, 533-34 (Alaska 1987) (citing                                                    Wilson v. Erickson                     , 477 P.2d     

998, 1001 (Alaska 1970);                               Beauchamp v. Emp'rs Liab. Assurance Corp.                                                       , 477 P.2d 993,        

996 (Alaska 1970)).         

              68            See Beauchamp, 477 P.2d at 996 & n.8 (quoting 2A ARTHUR   LARSON,  



WORKMEN'S COMPENSATION LAW   79.50, at 299 (1970)) (discussing extent to which                                                                                           

                                                                                                                                                                   RISTIN   E.  

expert medical testimony is necessary in compensation cases);                                                                           see also           2 K 

    ICKMAN & RICHARD J. PIERCE, JR., ADMINISTRATIVE LAW TREATISE   9.6, at 1052-53                                                                                   


(6th ed. 2019) (discussing adjudicators' use of their own knowledge to assess evidence).                                                                          

                                                                                       -34-	                                                                                 7422

----------------------- Page 35-----------------------

witnesses. SEARHCresponds                                              that the Board properly evaluated the proposed testimony  

and correctly decided it was not relevant.                                  

                               Theclaimants                     sought to call Grahamand three                                          other attorneys as witnesses.                                      

One Juneau attorney would have testified about                                                              thereasons"he declines to accept Alaska                                      

compensation cases" and Graham's "legal abilities and experience."                                                                                              Another attorney   

would also                   have testified about "Graham's experience and abilities" as well as his                                                                                             

"ability to earn                       large   fees handling personal injury cases."                                                              Finally,   an   Anchorage  

attorney would have testified about the "hourly rates received by experienced Alaska                                                                                                     

compensationattorneys,"among                                               other things. Grahamevidently                                            intended tosupplement   

                                                                                                                                                      69    The Board decided  

his fee affidavit through testimony, as a Board regulation allows.                                                                                                                     

that the proposed testimony was either irrelevant, repetitious, or both. The Commission  



decided that the Board had not abused its discretion.                                                                          


                               The Board's failure to allow Graham to testify is troubling in light of the  


express  regulatory  provision  that  authorizes  attorney  testimony  at  a  hearing  to  


supplementfeeaffidavits. SEARHC's assertionthat "undertherules"theclaimants were  


required to file "updated fee affidavits" at the hearing is perplexing given the regulatory  


                69             8 AAC 45.180(b).     



                               The Commission erroneously evaluated this issue as the application of a  


Board regulation and incorrectly stated that AS 44.62.460 does not apply to Board  


hearings because of a Board regulation.   The Alaska Administrative Procedure Act  


applies to Board proceedings "where procedures are not otherwise expressly provided  


by the Alaska Workers' Compensation Act." AS 44.62.330(a)(12). While the Board has  


the power to promulgate regulations interpreting the Act, AS 23.30.005, a regulation is  


not a statute and cannot overrule one.   We have applied AS 44.62.460 to workers'  


compensation proceedings in the past.  See, e.g., DeNuptiis v. Unocal Corp., 63 P.3d  


272, 277-78 (Alaska 2003) (applying AS 44.62.460(e) and concluding that the standard  


of proof was preponderance of the evidence); Emp'rs Commercial Union Ins. Grp. v.  


Schoen, 519 P.2d 819, 823-24 (Alaska 1974) (applying AS 44.62.460(b)).  

                                                                                                -35-                                                                                         7422

----------------------- Page 36-----------------------


language.  Moreover, SEARHC said it could not object to Graham "testifying about his  


fee affidavit." The Board's exclusion of Graham's testimony was an abuse of discretion.  


                    Although wehaveexplainedthattheBoardandCommissionmisunderstood  


our  precedent  and  improperly  narrowed  the  inquiry  related  to  reasonable  fees,  the  


Board's blanket exclusion of all testimony from the attorney witnesses was improper  


even if the Board had been right about the relevant factors.  Two of the attorneys would  


have provided testimony about Graham's experience; while the Board was interested  


only in workers' compensation experience, the record does not show that the witnesses  


had no knowledge of this issue.  Likewise, the Anchorage attorney would have testified  


about the very information the Board derived from its database - the hourly rates  


received by workers' compensation attorneys.   The Board also said some testimony  


would be unduly repetitious, but testimony is not repetitious if no testimony has been  




                    We  do  not  mean  to  imply  that  administrative  adjudicators  have  no  


discretion to control hearings and limit witnessesto relevanttestimony: AS44.62.460(d)  


expressly permits exclusion of "[i]rrelevant and unduly repetitious evidence."  But the  


Board prevented the witnesses from testifying at all - it did not sustain objections to  


specific questions eliciting irrelevantinformation -eventhough theproposed testimony  


was relevant. TheCommission's comment that "the testimony of the proposed witnesses  


would  not  have  provided  the  Board  with  any  information  not  already  within  its  


knowledge"  is  simply  not  accurate.                      At  the  time  the  claimants  sought  to  call  the  


witnesses,  the  Board  panel  did  not  have  the  information  the  witnesses  might  have  


supplied - the Board presumably had to look up the information after the hearing since  


it was unable to provide the claimants with it when they asked at the hearing.   The  


Commission's conclusion that the Board did not abuse its discretion in excluding the  


attorney witnesses' testimony was incorrect, and we reverse that decision.  

                                                              -36-                                                         7422

----------------------- Page 37-----------------------

                 F.	 	           The   Commission   Correctly   Concluded   That   The   Presumption   Of  

                                 Compensability Does Not Apply To The Amount Of Fees.                                                                                       

                                 The claimants argue that the presumption of compensability should apply                                                                                                

to attorney's fees because we have held that a claimant is entitled to the presumption of                                                                                                                        


compensability on evidentiary issues involved in the determination of compensability.                                                                                                                                   


In response SEARHC relies on an unpublished decision in which we decided that the  



presumption of compensability did not apply to a request for attorney's fees.                                                                                                                    We said  


there that the Board was "to determine the reasonableness of each request for fees" and  


concluded that attorney's fees "are subject to the broad discretion of the Board and will  



be  upheld  unless  manifestly  unreasonable."                                                                              SEARHC  also  points  out  that  the  


reasonableness of fees involves discretion.  


                                 We agree with the Commission that the presumption of compensability  


does not apply to the amount of fees and their reasonableness, but our reasoning differs  


from the Commission's.   We have held that the presumption does not apply to all  


contested  issues in  a workers'  compensation claim,  with our  decisions considering  

                                                                                                                                                                         74       In  Rockney  v.  


whether  application  of  the  presumption  furthered  statutory  goals. 

Boslough Construction Co. we held that the presumption did not apply to evaluating  


whether a specific reemployment plan met the relevant statutory requirements because  


                 71              See Sokolowski v. Best W. Golden Lion Hotel                                                                     , 813 P.2d 286, 292 (Alaska                       

 1991) (setting out that claimant "is entitled to presumption of compensability as to each                                                                                                                 

of those questions" involved in determining whether a judicially recognized exception                                                                                                         


                 72              Soule v. Mid-Town Car Wash, No. S-5634, 1994 WL 16459431 (Alaska  


Aug. 3, 1994).  


                 73 	            Id. at *1.  


                 74 	            Burkev.HoustonNANA, L.L.C., 222P.3d851,861(Alaska2010); Rockney  


v. Boslough Constr. Co., 115 P.3d 1240, 1243-44 (Alaska 2005).  


                                                                                                      -37-	                                                                                              7422

----------------------- Page 38-----------------------

the insurer and employer did not dispute the claimant's "entitlement to reemployment                                               


benefits or their liability for those benefits."                                                                                                       

                                                                                     We observed that the claimant was not  


seeking   coverage   and   reasoned   that   "applying   the   presumption   to   evaluating  


reemployment plans does not promote the goals of encouraging coverage and prompt  



benefit payments." 

                        A similar rationale applies here. The parties did not dispute the claimants'  


entitlement to attorney's fees; they disputed the fees' reasonableness.  A determination  


of reasonableness requires consideration and application of various factors that may  


involve factual determinations,77 but the reasonableness of the final award is not in itself  


a factual finding.  The difference is illustrated by what we consider in reviewing these  


questions.  We use the substantial evidence test for review of factual determinations,  



considering whether the record has adequate evidence to support the factual finding.                                                                           


In contrast when we review the Board's exercise of discretion in an award of attorney's  



fees, we consider whether the award is manifestly unreasonable.                                                          


            75           115  P.3d  at   1244.  

            76          Id.   

            77          See   AS   23.30.145(a)   (requiring   consideration   of   "nature,   length,   and  

complexity   of  the   services"   as  well   as  benefits  resulting   from   attorney's   services);   8  

AAC  45.180(b),  (d).  

            78          Rockney, 115 P.3d at 1242.  


            79           Williams v. Abood ,  53  P.3d  134,  139 (Alaska  2002);  see  also Reid  v.  


 Williams, 964 P.2d 453, 460 n.17 (Alaska 1998) ("An award of attorney's fees will only  


be reversed for an abuse of discretion, which exists if the award is arbitrary, capricious,  


manifestly unreasonable, or the result of an improper motive." (quoting Hughes v. Foster  


 Wheeler Co., 932 P.2d 784, 793 (Alaska 1997))).  


                                                                           -38-                                                                    7422

----------------------- Page 39-----------------------

               G.             The Commission Erred In Affirming Use Of A Paralegal Rate.                                                                                

                              TheCommissionaffirmedtheBoard's                                                      decisionthatsomeofGraham'stime                                         

should   only   be   paid   at   a   paralegal   rate.     Neither   the   Board   nor   the   Commission  

articulated a standard to distinguish attorney tasks from paralegal tasks. The Board cited                                                                                               

only   one prior                    Board   decision   about paralegal work,                                                  which   involved an                           attorney's  

voluntary reduction in her hourly rate for tasks she considered paralegal tasks.                                                                                                 80  


                              We agree with the claimants that it was improper to award a paralegal's  


hourly rate for legal tasks performed by an attorney.  The Board's regulations allow  



awards of attorney's fees only to licensed attorneys                                                                      and permit paralegal work to be  


billed as a cost only when the paralegal "is employed by an attorney licensed in this state  

                                      82  In other words, the training of the person doing the work, not the task  



or another state." 

performed, determines whether the award is for attorney's fees or costs. As the claimants  


argue, many tasks in a workers' compensation case can be performed by paralegal staff  


because the Board permits nonattorney representatives at all stages of its proceedings.83  


                              Reducing an attorney's hourly fee to a paralegal rate for work the attorney  


performed discourages rather than encourages representation of injured workers.  The  


Board and Commission should not penalize an attorney who does not employ a paralegal  


and performs legal tasks that either an attorney or a paralegal can perform.  Even when  


attorneysemployparalegals,attorneys musthave discretion to managetheir lawpractices  


               80             Baker v. Pro West Contractors L.L.C.                                                   , AWCB Dec. No. 15-0069 at 11,                                         

(June 16, 2015),                                                                                                                

               81             8 AAC 45.180(b), (d); cf. AS 23.30.260(b) (permitting attorney licensed  


in this state to charge a one-time fee of $300 for services when attorney does not enter  


an appearance).  


               82             8 AAC 45.180(f)(14).  


               83             8 AAC 45.178 (2011).  


                                                                                             -39-                                                                                       7422

----------------------- Page 40-----------------------

and select which tasks to delegate to paralegals.                                                             An attorney's voluntary decision to                                          

charge only a paralegal rate in one claim does not create a legal rule that permits the                                                                                                 

Board to reduce arbitrarily the fees awarded when an attorney performs tasks that are                                                                                                   

necessary to the claim but might be within a paralegal's duties in a larger firm.                                                                                  

                              The Act is to be construed and applied in a manner that encourages, not                                                                                   

                                                                                                                          84   We agree with the claimants'  

discourages, attorney representation of injured workers.                                                                                                                 

argument before the Board that awarding only a paralegal rate for work done by an  


attorney will result in fewer attorneys who will represent claimants.  The Commission's  


decision that paralegal tasks were properly "reduced in value" is contrary to the goal of  


ensuring that competent counsel are available to represent injured workers and must be  



               H.	 	          The  Commission  Erred  In  Concluding  That  Substantial  Evidence  


                              Supported The Board's Findings.  


                              The parties dispute the Commission's conclusion that substantial evidence  


in the record supports the Board's findings.  These were highly contentious cases, and  


many of SEARHC's objections to fees were based on assertions of fact, leaving the  


adjudicators with the difficult task of combing through the records to resolve multiple  


picayune disputes.   Not all of the disputes centered on facts; instead, they involved  


questions of the reasonableness of the time spent.  For example, SEARHC asserted that  


Graham spent an unreasonable amount of time reviewing discovery even though it  


acknowledged that it had provided him with discovery at those times.  The Commission  


decided in conclusory fashion that substantial evidence supported the Board's decisions  


               84            See, e.g., Cortay v. Silver Bay Logging, 787 P.2d 103, 109 (Alaska 1990)  


("Awarding  fees  at  half  a  lawyer's  actual  rate  is  inconsistent  with  the  purpose  of  


awarding full attorney's fees in the worker's compensation scheme.").  


                                                                                           -40-	                                                                                    7422

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but only provided analysis on a few issues.                                                                                                                                                         Even though we are remanding this case                                                                                                                         

for further proceedings, we address a few factual findings that do not appear to be                                                                                                                                                                                                                                                                                       

 supported by the record to assist the Board on remand.                                                                                                                                                                                        

                                                          In   Dockter's   case   the   Commission   affirmed   the   Board's   decision   that  

Dockter   had   not   prevailed   on   the   compensation   rate   adjustment,   writing   that   the  

 settlement   "did   not   provide   money   for   resolving   this   issue."     Yet  the   settlement  

agreement describes a dispute over the weekly compensation rate and says that the                                                                                                                                                                                                                                                                                      

parties' settlement of TTD "reflects a compromised rate," suggesting that SEARHC did                                                                                                                                                                                                                                                                                    

in fact provide some money for the compensation rate adjustment. If that is the case, the                                                                                                                                                                                                                                                                                

Board's decision was not supported by the evidence.                                                                                                                                        

                                                          We also question the Commission's conclusion that the Board justifiably                                                                                                                                                                                                         

eliminated all of Graham's time for work on what he called a mediation brief in the                                                                                                                                                                                                                                                                                     

attorney's fees dispute. TheCommission                                                                                                                                          thought thedocument                                                                           was "unnecessary." The    

Board said that the brief was prepared "after mediation ended," but it did not account for                                                                                                                                                                                                                                                                               

evidence from both parties suggesting that the parties anticipated working further with                                                                                                                                                                                                                                                                           

the   mediator   to   resolve   the   attorney's  fees   dispute.     It   is   unclear   why   a   document  

prepared to assist a mediator would have been unnecessary, particularly when it appears                                                                                                                                                                                                                                                         

the mediator shared the document's contents with SEARHC's attorney. After the Board                                                                                                                                                                                                                                                                         

reassesses the claimants' success, it will also need to reassess the hours permitted as                                                                                                                                                                                                                                                                                     

reasonable attorney's fees.                                                                    

                             85                           As we pointed out above, we found nothing to support the Commission's  


conclusion that the Board reduced Graham's hours for researching wrongful termination  


in Rusch's case.  The Commission made a similar determination in Dockter's case.  We  


are unaware of any dispute about the termination of Dockter's work with SEARHC.  


                                                                                                                                                                                   -41-                                                                                                                                                                          7422

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            I.	 	       The   Commission   Erred   In   Concluding   That   The   Board   Properly  

                        Exercised Its Discretion In Awarding Fees.                                

                        In both decisions, theBoardmadeatableshowingreductionsintheclaimed                                                     


attorney time based on Graham's "billing methods," i.e. his use of block billing                                                                     and  


quarter-hour  time  increments.                            The  Board  constructed  a  second  table  in  each  case  


showing reductions for what it considered "unreasonable time spent on relatively simple  



tasks."           The total reduction was not trivial:  in Dockter's case the reductions totaled  


more than 25 hours, and in Rusch's case they exceeded 50 hours.  


                        The Board apparently considered the complexity and novelty of the issues  


in the cases, but it is not clear how it used these factors in its analysis; it seems to have  


used these factors to decide that the total number of hours billed was unreasonable, but  



it did not explicitly cite the factors in reducing any time entry.                                                 The Board decided that  


Rusch's "medical and legal issues were not complex or novel" because "[b]ack injuries  


are the most common injuries claimed by injured workers."  It considered Dockter's  


legal issues to be "of average complexity."  


                        The Commission affirmed the Board's decisions because in its view the  


Board acted within its discretion in making these reductions.  The Commission agreed  


that the medical issues were neither complex nor novel, it thought the cases were not  

            86          We find it significant that                     both  attorneys' billing records here used block  


            87          Because the Board identified time entries in these tables by date and hours  


claimed, it is not always evident which time entries were reduced or eliminated.  The  


Board reduced to zero some time entries in Rusch's case; it did not explain why those  


tasks were unnecessary.  


            88          As we mentioned above, neither party raised an issue about the method of  


calculating fees here; the awarded fees were the product of the hours the Board allowed  


and the hourly rate the Board awarded.  


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----------------------- Page 43-----------------------

lengthy,   and it concluded                                      that the amount of fees awarded                                                   in   both   claims was not                       

manifestly   unreasonable.    In  Rusch's   case   the   Commission   amplified   the   Board's  

findings about the lack of complexity, explaining that the lack of a second independent                                                                                         

medical evaluation (SIME) or doctors' depositions was "evidence that this was not a                                                                                                             

complex case." Neither agency mentioned issues of redacted documents or SEARHC's                                                                                                 

failure to file at least one medical report in Rusch's case, nor did they explore the                                                                                                                

relationship between reemployment benefits, TTD, and Rusch's layoff.                                                                                      

                                The claimants argue that the Board abused its discretion when it reduced   

their attorney's hours because of block billing and his use of quarter-hour increments for                                                                                                            

                               89     SEARHC responds that substantial evidence in the record supports the  

time records.                                                                                                                                                                                         

Board's reductions in hours.  It contends that disallowing time for block billing "was  


perfectly logical and rational" and an appropriate "observation" based on the Board's  


experience "as an administrative tribunal."  It maintains that reducing hours because of  


Graham's use of quarter-hour time increments was supported by substantial evidence  


because  the  Board  found  "that  billing  in  increments  of  one-tenth  of  an  hour  was  



                                Turning first to the use of a specific time increment, the fact that workers'  


compensation attorneys generally bill in increments of one-tenth of an hour does not  


make that custom a rule of law.  The Board's regulations do not require use of a specific  


time increment, and the Board did not tell Graham at the hearing that he needed to use  


tenths of an hour so that he could modify his affidavit.  The reduction in hours solely  


based on the use of quarter-hour increments was an abuse of discretion.  




                                The claimants ask us, without explanation, to increase the fees awarded  


under AS 23.30.145(c).  We have never construed this statutory subsection as allowing  


us to increase Board-awarded fees; because the claimants provided no argument to  


support their request, we consider this issue waived.  

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                                   The   reductions   solely   based   on   block   billing   were   also  an  abuse   of  

discretion.    The Board's regulation does not prohibit block billing, and prior Board                                                                                                           

                                                                                                                                                                                              90   The Board  

decisions do not have a clear rule about reductions solely for block billing.                                                                                                                                    

here said that block billing made it difficult to determine whether the specific tasks were  


related to issues on which the claimants succeeded, but in some instances the Board  


reduced the attorney's time when all of the tasks appear to be related to issues on which  


the claimants prevailed. And in evaluating entries with block billing, the Board at times  


awarded less time than SEARHC agreed was reasonable without explaining why.  


                                   The fact that back injuries are common does not support a finding that a  


particular case is not complex,91  nor is the fact that certain benefits are "common" or  


"routinely addressed" evidence that the legal issues related to those benefits are not  


complex. And the lack of an SIME or multiple medical depositions is as much evidence  


that the cases settled early in the litigation process as it is that they were not complex.  


                                   By any measure the fees awarded in these cases were unreasonably low.  


Rusch received in her final settlement far more than SEARHC ever offered  before  


Graham entered an appearance.  According to Hennemann's billing records, her firm  


                  90               See Lavallee v. Bucher Glass Inc.                                                    , AWCB Dec. No. 16-0055 at 32-33 (July                                                      

 8,          2016),          

("encourag[ing]" employee's attorney to avoid block billing in future but listing multiple                                                                                                                 

factors in adjusting fees);                                         Mullen v. Municipality of Anchorage                                                               , AWCB Dec. No. 10-                              

0172 at 11 (Oct. 14, 2010) (reducing by three hours attorney time for duplicate billing                                                                                                                         

for conferences after observing that block billing made using estimate necessary).                                                                                                                                   The  

Board has also approved block billing, writing that a hearing officer can evaluate the                                                                                                                                  

reasonableness and necessity of the tasks listed for a day.                                                                                             McKenna v. ARCO Alaska,  

Inc., AWCB Dec. No. 12-0070 at 60 (Apr. 9, 2012).                                                                       

                  91               See,  e.g.,  Smith  v.  Univ.  of  Alaska,  Fairbanks,  172  P.3d  782,  789-90  


(Alaska 2007) (reversing Board's decision not to consider lay testimony in medically  


complex back-injury case).  


                                                                                                           -44-                                                                                                    7422

----------------------- Page 45-----------------------

billed the employer over $44,500 in legal fees through the end of July for representing                                                                                                                                                                                                                   

it in Rusch's case; the records do not include the hearing or time related to SEARHC's                                                                                                                                                                                                                       

objections to Graham's fee affidavit.                                                                                                                The amount of fees the Board awarded Rusch for                                                                                                                                              

work through the time Graham filed his supplemental fee affidavit in October, after the                                                                                                                                                                                                                                                         

hours-long hearing, was $39,513.50.                                                                                                                  In Dockter's case the difference was not as great:                                                                                                                                                          

Hennemann's firm billed its clients just over $33,700 in legal fees through the end of                                                                                                                                                                                                                                                              

July, and the Board awarded Dockter $34,773.50 for Graham's work through the filing                                                                                                                                                                                                                                                    

of his supplemental fee affidavit in October.  But, as with Rusch, Dockter received far                                                                                                                                                                                                                                                          

more in settlement than SEARHC had previously offered, and she additionally obtained                                                                                                                                                                                                                                      

the partial knee replacement surgery she sought.                                                                                                                                                            And because of the procedure the                                                                                                   

Board used here, the claimants were not able to document and get payment for their                                                                                                                                                                                                                                                       

attorney's time spent responding to SEARHC's extensive objections to the fee affidavits                                                                                                                                                                                                                                

or its objection to the timeliness of their responses.                                                                                                             

                                                      Wehave"noted                                                    that employees'attorneys need                                                                                              to earn                     morethan                                 a'normal   


hourly fee' on successful cases because they receive nothing on unsuccessful cases."                                                                                                                                                                                                                                                                             

We have consistently instructed that the Act is to be construed and applied to ensure that  


competent counsel are available to represent claimants.93                                                                                                                                                                              The fees awarded here do not  


meet  this  standard  and  are  manifestly  unreasonable.                                                                                                                                                                             Neither  the  Board's  nor  the  


Commission's decisions can fairly be characterized as consistent with the goals we have  


identified, even though the Board cited our precedent and acknowledged the policies  


underlying them.  Using a legal standard like an incantation, in the hope that the mere  


recitation of the standard will transform a decision contrary to the standard into one  


                           92                         State, Dep't of                                                Revenue v. Cowgill                                                                  , 115 P.3d 522, 526 (Alaska 2005)                                                                                         

(quoting   Wise Mech. Contractors v. Bignell                                                                                                                                     , 718 P.2d 971, 975 (Alaska 1986)).                                                                                

                           93                         E.g., id. at 524; Cortay v. Silver Bay Logging, 787 P.2d 103, 108 (Alaska  


 1990); Bignell, 718 P.2d at 973.  


                                                                                                                                                                       -45-                                                                                                                                                              7422

----------------------- Page 46-----------------------

conforming to it, is not the point of the law.  For the law to have meaning, application                                                                                                                                                                                                                   

of standards must be more than an empty exercise.                                                                                                                                                                                                                          The Commission's decisions here,                                                                                                                               

while reciting the law about the importance of representation, work to discourage rather                                                                                                                                                                                                                                                                                                                                             

than encourage representation of claimants and must be reversed.                                                                                                                                                                                                                                     

V.                                 CONCLUSION  

                                                                      We    AFFIRM    the    Commission's    decision    that    the    presumption    of  

compensability does not apply to the reasonableness of an attorney's requested fees.                                                                                                                                                                                                                                                                                                                                                                  In  

all other respects, we REVERSE the Commission's decisions and REMAND the cases                                                                                                                                                                                                                                                                                                                                                          

to the Commission with instructions to remand to the Board for further proceedings                                                                                                                                                                                                                                                                                                                


consistent with this opinion.  

                                                                                                                                                                                                                        -46-                                                                                                                                                                                                               7422

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