Oregon Revised Statutes Chapter 656 § 656.593 — Procedure when worker or beneficiary elects to bring action; release of

Procedure when worker or beneficiary elects to bring action; release of liability and lien of paying agency in certain cases. (1) If a worker or the beneficiaries of the worker elect to recover damages from an employer or third person, the worker or beneficiaries shall give notice of the election to the paying agency by personal service or by registered or certified mail. The paying agency likewise must be given notice of the name of the court in which the action is brought, and a return showing service of the notice on the paying agency must be filed with the clerk of the court but is not a part of the record except to give notice to the defendant of the lien of the paying agency, as provided in this section. The proceeds of any damages the worker or beneficiaries recover from an employer or third person are subject to a lien of the paying agency for the paying agency’s share of the proceeds as set forth in this section. If the proceeds are paid in a series of payments, each payment must be distributed proportionately to each recipient according to the formula provided in this section, unless the parties otherwise agree. The total proceeds must be distributed as follows: (a) Costs and attorney fees incurred must be paid, and the attorney fees may not exceed the advisory schedule of fees established by the Workers’ Compensation Board for such actions. (b) The worker or the beneficiaries of the worker must receive at least 33-1/3 percent of the balance of the recovery. (c) The paying agency must be paid and retain the balance of the recovery, but only to the extent that the paying agency is compensated for the paying agency’s expenditures for compensation, first aid or other medical, surgical or hospital service, and for the present value of reasonably expected future expenditures the paying agency makes for compensation and other costs of the worker’s claim under this chapter. Other costs include expenditures that the Department of Consumer and Business Services makes from the Consumer and Business Services Fund, the Self-Insured Employer Adjustment Reserve, the Self-Insured Employer Group Adjustment Reserve and the Workers’ Benefit Fund to reimburse the costs of the paying agency. Other costs also include assessments for the Workers’ Benefit Fund and any compensation that may become payable under ORS 656.273 or 656.278. (d) The balance of the recovery must be paid to the worker or the beneficiaries of the worker forthwith. The board shall resolve any conflict as to the amount of the balance that the paying agency may retain. (2) The amount the worker or the beneficiaries of the worker retain must be in addition to the compensation or other benefits to which the worker or beneficiaries are entitled under this chapter. (3) A claimant may settle any third party case with the approval of the paying agency, in which event the paying agency may accept a share of the proceeds that is just and proper and the worker or the beneficiaries of the worker must receive the amount to which the worker would be entitled for a recovery under subsections (1) and (2) of this section. The board shall resolve any conflict as to what may be a just and proper distribution. (4) As used in this section, “paying agency” includes the Department of Consumer and Business Services with respect to expenditures from the Consumer and Business Services Fund, the Self-Insured Employer Adjustment Reserve, the Self-Insured Employer Group Adjustment Reserve and the Workers’ Benefit Fund the department makes, together with the present value of any reasonably expected future expenditures from the funds or reserves that the department may make, to reimburse the costs of another paying agency and to compensate or pay other costs of a worker’s claim because of a self-insured employer’s or self-insured employer group’s insolvency, default or decertification. (5) The department must be repaid for the department’s expenditures from the proceeds the paying agency recovered in an amount proportional to the amount of the department’s reimbursement of the paying agency’s costs. The department shall deposit all moneys the department receives under this section in the same fund from which the department’s expenditures originated. (6) Before, and instead of, the distribution of proceeds described in subsection (1) of this section, if a worker or the beneficiaries of a worker are entitled to receive payment pursuant to a judgment or a settlement in a third party action in the amount of $1 million or more, the worker or the beneficiaries of the worker may elect to release the paying agency from all further liability on the workers’ compensation claim, thereby canceling the lien of the paying agency as to the present value of the paying agency’s reasonably expected future expenditures for workers’ compensation and other costs of the worker’s claim, if all of the following conditions are met as par