Smith v. American Economy Insurance Co.
The Smiths appealed a summary judgment in a workers' compensation case. Beverly Smith suffered a back injury at work and settled her claim based on medical reports from doctors recommended by the appellees, American Economy Insurance Company and Lindsey & Newsom Insurance Adjusters, Inc. Subsequent diagnoses revealed a herniated disk requiring surgery and leading to permanent disability. The Smiths sued for misrepresentation and bad faith. The trial court granted summary judgment, citing ERISA preemption and judicial estoppel. The appellate court reversed, ruling that workers' compensation claims are exempt from ERISA preemption and judicial estoppel does not bar challenging a compromise settlement agreement based on alleged misrepresentations, remanding the case for trial.