ADJ19773230 · July 28, 2026

From the decision · page 5We agree with the WCJ that the rejection of liability was unreasonable, and that the penalty was warranted. Defendant makes much of when a defendant’s duty to investigate a claim first arises. Regardless of when such a duty arises generally, in this case applicant testified that his employer told him that the paperwork for his workers’ compensation case had been initiated soon after the injury, and the WCJ found this testimony credible. In fact, this testimony was completely corroborated by the fact that applicant received a denial on July 23, 2004, a little more than two months after his injury. The denial expressly refers to “your workers’ compensation claim” and “your cardiac claim.” The denial states that it was made “after careful review and consideration” and acknowledges applicant’s upcoming cardiac appointment at Stanford. Although the grounds for the denial were that there was no “substantial medical, legal or factual evidence to support a confirmed diagnosis for a heart condition,” applicant’s co-worker’s and supervisor had witnessed applicant’s injury or its immediate after-effects, saw him transported to the emergency room, where he was admitted to the hospital.

Applicant was diagnosed with atrial fibrillation and other heart conditions on the date of injury and shortly thereafter by multiple medical professionals.

Favours Applicant prevailed

This established the compensability of the heart injury and undermined defendant's basis for denial.

From the decision · page 5Although defendant did not offer evidence regarding the information that was given “careful review and consideration,” by the time of the rejection of liability, applicant had been diagnosed with atrial fibrillation by the emergency room physician, the admitting hospitalist, and the cardiologist on duty at the hospital, and the treating cardiologist had already recommended an ablation. Applicant clearly already had a diagnosed heart condition. Defendant’s Petition ignores this history prior to the resubmission of the claim in September of 2004. Defendant’s Petition also ignores the rationale given in the first rejection of liability and gives a completely different rationale for its delay in its Petition, stating that it was reasonable to give it an opportunity to rebut the heart trouble presumption. Defendant states that it

Defendant denied the claim after 'careful review and consideration' despite medical evidence and delayed payment of benefits for months.

Favours Applicant prevailed

This demonstrated unreasonable rejection of liability and justified the penalty under Labor Code section 5814.3.

From the decision · page 5We agree with the WCJ that the rejection of liability was unreasonable, and that the penalty was warranted. Defendant makes much of when a defendant’s duty to investigate a claim first arises. Regardless of when such a duty arises generally, in this case applicant testified that his employer told him that the paperwork for his workers’ compensation case had been initiated soon after the injury, and the WCJ found this testimony credible. In fact, this testimony was completely corroborated by the fact that applicant received a denial on July 23, 2004, a little more than two months after his injury. The denial expressly refers to “your workers’ compensation claim” and “your cardiac claim.” The denial states that it was made “after careful review and consideration” and acknowledges applicant’s upcoming cardiac appointment at Stanford. Although the grounds for the denial were that there was no “substantial medical, legal or factual evidence to support a confirmed diagnosis for a heart condition,” applicant’s co-worker’s and supervisor had witnessed applicant’s injury or its immediate after-effects, saw him transported to the emergency room, where he was admitted to the hospital.

Applicant's indemnity payments were converted to non-industrial time off without consent, effectively depriving him of benefits.

Favours Applicant prevailed

This conduct supported the imposition of the maximum penalty for unreasonable delay and denial of benefits.

From the decision · page 7Portesi is distinguishable because it addressed a penalty for defendant’s failure to timely convert vacation and sick time to Labor Code § 4850 benefits pursuant to stipulated award. In that case, the issue was conversion of lost PTO time to 4850 time. Here, the opposite was done, where Defendant paid 4850 time but later converted it to PTO time, without applicant’s knowledge or consent. In doing so, they stripped applicant of a benefit that was previously paid to him. They only did this after the denial of his claim in July of 2024. They did so with the intent to deprive him of that benefit, and this was therefore not a mere payroll coding or reclassification issue as they are suggesting. This is not a bookkeeping issue but instead Defendant’s attempt to credit themselves back for benefits that were not due, in contradiction to Labor Code Section 4909.

Found applicant sustained compensable atrial fibrillation, mitral valve regurgitation, and left ventricular hypertrophy.

From the decision · page 3Turning to the merits, the parties stipulated that applicant was injured while working as a fire engineer for the City of Modesto. Applicant testified that while at work on May 10, 2024 he began to work out but then began sweating profusely, had spotty vision, and a sporadic heart rate. He hooked himself up to a heart monitor and saw his heart rate go up very high and then go low. An ambulance was called. He testified that a monitor in the ambulance confirmed atrial fibrillation. (Minutes of Hearing and Summary of Evidence of March 30, 2026 trial at p. 4.) He was then taken to the emergency room. According to the records summarized later by qualified medical evaluator internist Andrew McClintock Greenberg, M.D., in the emergency room applicant was given an EKG which showed atrial fibrillation with rapid ventricular response. He was diagnosed in the emergency room with “new onset [atrial fibrillation].” He was admitted into the hospital on the date of injury. (November 20, 2024 report at p.

Labor Code section 5814.3

Labor Code section 5814.3 penalty for unreasonable rejection of claims

The Appeals Board applied this statute to find the defendant's rejection of liability unreasonable and imposed the maximum penalty.

Labor Code section 3212

Presumption under Labor Code section 3212 for heart trouble injuries

The Appeals Board applied the presumption that heart trouble injuries are compensable unless rebutted by a contemporaneous non-work-related event, which defendant failed to prove.

From the decision · page 5(3) The … heart trouble … so developing or manifesting itself in those cases shall in no case be attributed to any disease existing prior to that development or manifestation.

Applicant's credible testimony and corroborating denial letter showing claim was initiated and denied after review, despite medical diagnoses of heart condition.

From the decision · page 5We agree with the WCJ that the rejection of liability was unreasonable, and that the penalty was warranted. Defendant makes much of when a defendant’s duty to investigate a claim first arises. Regardless of when such a duty arises generally, in this case applicant testified that his employer told him that the paperwork for his workers’ compensation case had been initiated soon after the injury, and the WCJ found this testimony credible. In fact, this testimony was completely corroborated by the fact that applicant received a denial on July 23, 2004, a little more than two months after his injury. The denial expressly refers to “your workers’ compensation claim” and “your cardiac claim.” The denial states that it was made “after careful review and consideration” and acknowledges applicant’s upcoming cardiac appointment at Stanford. Although the grounds for the denial were that there was no “substantial medical, legal or factual evidence to support a confirmed diagnosis for a heart condition,” applicant’s co-worker’s and supervisor had witnessed applicant’s injury or its immediate after-effects, saw him transported to the emergency room, where he was admitted to the hospital.

Medical records showing diagnosis of atrial fibrillation by emergency room physician, hospitalist, and cardiologist, and recommendation for ablation treatment.

From the decision · page 5Although defendant did not offer evidence regarding the information that was given “careful review and consideration,” by the time of the rejection of liability, applicant had been diagnosed with atrial fibrillation by the emergency room physician, the admitting hospitalist, and the cardiologist on duty at the hospital, and the treating cardiologist had already recommended an ablation. Applicant clearly already had a diagnosed heart condition. Defendant’s Petition ignores this history prior to the resubmission of the claim in September of 2004. Defendant’s Petition also ignores the rationale given in the first rejection of liability and gives a completely different rationale for its delay in its Petition, stating that it was reasonable to give it an opportunity to rebut the heart trouble presumption. Defendant states that it

Defendant's denial of claim and delay in payment of benefits, including conversion of indemnity payments to non-industrial time off without consent.

From the decision · page 7Portesi is distinguishable because it addressed a penalty for defendant’s failure to timely convert vacation and sick time to Labor Code § 4850 benefits pursuant to stipulated award. In that case, the issue was conversion of lost PTO time to 4850 time. Here, the opposite was done, where Defendant paid 4850 time but later converted it to PTO time, without applicant’s knowledge or consent. In doing so, they stripped applicant of a benefit that was previously paid to him. They only did this after the denial of his claim in July of 2024. They did so with the intent to deprive him of that benefit, and this was therefore not a mere payroll coding or reclassification issue as they are suggesting. This is not a bookkeeping issue but instead Defendant’s attempt to credit themselves back for benefits that were not due, in contradiction to Labor Code Section 4909.