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COLUMBUS, Ohio--The use of nonlawyer representatives by employers in workers compensation cases does not constitute an unauthorized practice of law, the Ohio Supreme Court has ruled.
In a 6-1 decision, the state's high court held in Cleveland Bar Assn. vs. CompManagement Inc. that work performed by a third-party administrator's nonattorney staff falls within limitations for nonattorney practice established by the Ohio Industrial Commission.
The Cleveland Bar Assn. filed a complaint with the Supreme Court's Board on the Unauthorized Practice of Law in 2004 alleging that Dublin, Ohio-based TPA CompManagement and its nonlawyer employees were engaging in the unauthorized practice of law in the course of representing employers in state workers comp claim proceedings before the Ohio Industrial Commission and Bureau of Workers Compensation.
The board agreed with the bar association in 2004, and again in December 2005, after the state Supreme Court remanded the case to re-examine CMI's activities in light of new Industrial Commission guidelines.
Specifically, the board found that based on the new guidelines, CMI's nonattorney employees were performing work functions in four areas that were restricted to attorneys: settlement, examination of witnesses, hearing-room advocacy and recommendations to appeal or take other legal action.
The Supreme Court disagreed with the board's conclusions, holding that neither CMI nor its nonattorney staff committed any specific act constituting the unauthorized practice of law.
"A third-party administrator may make actuarial determinations regarding (a) settlement, act as a messenger for the employer in regard to (a) settlement, and file settlement applications without conducting the unauthorized practice of law, as these activities do not require the specialized training and skill of an attorney," the court said in its decision.
Jonathan R. Wagner, a former president of CompManagement who now is executive vp of Sedgwick Claims Management Services Inc., which acquired CompManagement earlier this year, said the company is "pleased that the Ohio Supreme Court considered the tremendous value that third-party administrators provide to American businesses."
He noted that the company was supported by more than 80 business trade associations representing thousands of employers in the case.
"The importance of bringing these...actions is to make sure we're vigilant in protecting the public and make sure that people who are practicing law are actually lawyers," said Hugh McKay, president of the Cleveland Bar Assn. "The Supreme Court is ultimately the arbiter of what is and what is not practicing law and obviously we defer to their rulings, but it is important that we remain vigilant that law is not being practiced by nonlawyers," he said.