United States Court of
Claims
Bedell v. Secretary of the Department of Heath and Human Services, 1992 U.S. Ct. Cl. Ct. Lexis 458 (U.S. Court of Claims 1992). This is a Vaccine Act Case in which Judge George Hastings, Jr., provides his assessment of life care plans produced by the petitioner (the plaintiff in Vaccine Act Cases) by Drs. Robert Voogt and for the respondent (the defendant United States in Vaccine Act cases) by Jacqueline Peterson. Judge Hastings said of the petitioner’s experts: “I note that after listening to their testimony, I cannot conclude the Dr. Voogt and Dr. Walicke were particularly candid witnesses. To the contrary, while both are highly qualified in their professional fields, I conclude that they are also likely inclined to slant their testimony in a fashion designed to maximize the potential award to their clients.” Judge Hastings found the opinions of Ms. Peterson more “persuasive.”
Brown v. Secretary of the Department of Health and Human Services, 2005 U.S. Claims LEXIS 291. This is a decision under the Vaccine Act. Both sides presented economic experts, Dr. Richard J. Lurito for the petitioner and Dr. Patrick F. Kennedy for Respondent. The decision reviews net discount rates that have been adopted by the Office of Special Masters in past cases and in the Pfeifer decision (1983). Special Master Richard Abel preferred Dr. Kennedy’s net discount rate, saying: “In the end, Dr. Lurito’s reliance on present day interest rates of various instruments does not seem like a reasonable formula for making future projections. In fact, on several occasions, Dr. Lurito altered his calculations to account for fluctuations in his proposed portfolio. . .That is not to say that Dr. Lurito’s approach is entirely without merit. Were this case dealing with a shorter time period, Dr. Lurito’s methodology might be acceptable. As it stands, however, the Court is attempting to discern a net discount rate that will accommodate roughly the next 25 years. While Dr. Lurito’s calculations present one picture of what a safe return might look like today, they are too mercurial to be relied upon in making a future projection.”
Euken v. Secretary of Health and Human Services, 34 F.3d 1045 (Fed. Cir. 1994). This decision of the Federal Circuit Court of Appeals held that FICA taxes are “appropriate taxes” to deduct under the Vaccine Act. The petitioner claimed that since the vaccine injured child would never collect Social Security retirement benefits, FICA taxes should not be deducted from the child’s lost earnings. The Court said: “[T]he argument that Cory would not receive any Social Security benefits is simply not pertinent to the question of whether FICA taxes are appropriate taxes to deduct from the average gross weekly earnings of a private sector worker. . . Accordingly, we conclude that FICA tax, like federal and state income taxes, is an appropriate tax to deduct in determining a lost earnings award under the Vaccine Act. It should be noted that this decision applies only to Vaccine Act cases, but other federal courts in other types of cases have ruled in a similar fashion with respect to including FICA taxes as a type of income tax that needs to be deducted when deducting income taxes.
Paul v. Department of Health and Human Services, 2007 U.S. Claims LEXIS 408 (U.S. Ct. Claims 2007). This was a Vaccine Act decision in which payment of experts, annuity contracts and attorney contingency fees in Vaccine Act cases was discussed at length.
Watkins v. Secretary of Health and Human Services, 1999 U.S. Claims 62 (Ct. Claims 1999). The is a decision of Gary J. Golkiewicz, Chief Special Master, in an Vaccine Act Case. This decision goes into considerable detail about how a child’s lifetime loss of earning capacity should be calculated if being compensated under the Vaccine Act. TheVaccine Act, 42 U.S.C. § 300aa-10 et seq. (Supp. V 1987). The Act states as a formula: “compensation after attaining the age of 18 for loss of earnings determined on the basis of the average gross weekly earnings in the private, non-farm sector, less appropriate taxes and the average cost of a health insurance policy. . .” Both the plaintiff and the respondent had obtained economic experts, who were generally in agreement regarding average weekly earnings of $28,392 as of 1997 with subtraction of 11.40% for federal income taxes, 6.04% for Utah income taxes, 7.65% for FICA taxes and $248.93 per month for health insurance. The Special Master addressed the following measurement questions: “Should self-employed workers be considered in the base wages portion of the forumula? . .; Is “non-farm sector” equivalent to the government’s exclusion of ‘all workers in agricultural production (crops and livestock)? . . .; Should 15-17 year olds be excluded from the data since the Act awards lost earnings post-18 years of age? . . ; Should the tax offset include personal exemptions for dependents and thus reduce the applicable marginal rate? . . ; Should social security payments upon retirement be considered as part of compensation since FICA is being deducted? After addressing those questions, the Special Master considered how the discount rate should be determined. The plaintiff expert, Dr. James Everson, argued for a net discount rate of 0.2% based on an historical comparison of figures from 1950-57. The defense expert, Dr. Patrick Kennedy, for a net discount rate of 2.0% based on an extended discussion of economic history that involved special weighting for “historic events.” The Special Master found Dr. Kennedy’s approach much more persuasive and pointed out a number of prior decisions using a 2.0% net discount rate. The Special Master also quoted “delusive exactness” language from the decision in Jones & Laughlin Steel Corp. v. Pfeifer, 103 S.Ct. 2541 (1983).