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OFF BEAT: Osage Nation, not insurer, has sovereign immunity in workers comp case


Oklahoma’s high court has rejected a workers compensation insurer’s argument that it should enjoy the same sovereign immunity as its policyholder, a casino owned by the Osage Nation.

The Osage Nation is a federally recognized American Indian tribe, so it is not subject to the Oklahoma Workers' Compensation Court’s jurisdiction, the Oklahoma Supreme Court ruled Tuesday in John A. Waltrip vs. Osage Million Dollar Elm Casino.

However, Hudson Insurance Co. is subject to the court’s jurisdiction, the state Supreme Court said.

The case began when Mr. Waltrip fell on a patch of ice while working as a casino surveillance supervisor. He injured his right shoulder and filed a workers comp claim in 2009, seeking medical care and temporary total disability benefits.

His employer and Hudson argued that the workers comp court lacked jurisdiction based on the tribe’s sovereign immunity.

The workers compensation court agreed, holding that the tribe enjoys sovereign immunity and that its insurance policy provisions did not subject Hudson to liability for claims filed in state court.

But the Oklahoma Supreme Court disagreed. It noted that the tribe does not have a workers comp ordinance or process for resolving injured worker disputes.

“Under such circumstances, insurer’s promise to provide benefits would become illusory and a sham,” the state high court said. “Insurer’s third-party administrator would by default become the final arbiter of the workers compensation claims of employees of the tribal enterprise.”

On remand, that court was instructed to reinstate the claim against Insurer only.