Court: Court of Appeals of Kansas

In this action, it was alleged that Plaintiff-Decedent David Kemper had occupational exposure to asbestos due to his employment as a technician with BNSF Railway Company for nearly three decades.  Mr. Kemper specifically claimed occupational exposure because of his work around insulation, steam lines, traction motors, brake shoes and gaskets, while employed as a technician with BNSF.

In November 2020, Mr. Kemper was diagnosed with mesothelioma — a form of lung cancer caused by exposure to asbestos. The following month, Mr. Kemper sued BNSF under the Federal Employers’ Liability Act (FELA), a federal statute allowing railroad employees to pursue negligence claims against their employers.

Mr. Kemper alleged that his mesothelioma was caused “in whole or in part” by BNSF’s failure to provide a reasonably safe working environment. BNSF countered, claiming among other things, that even if it were ultimately liable for Mr. Kemper’s injuries, it was entitled to “offset or deduct” any other compensation that Mr. Kemper had received relating to his mesothelioma.

On January 30, 2022, Mr. Kemper passed away. His spouse, Carolyn Kemper, was substituted as the plaintiff. Near the close of discovery, BNSF requested the court to enter an order declaring that BNSF was entitled to a setoff for any settlements that Mr. Kemper had received from asbestos bankruptcy trusts. BNSF specifically alleged that Mr. Kemper had already received over $580,000 from dozens of asbestos trusts and would likely receive more. The district court held a hearing on BNSF’s motion for setoff, but it ultimately reserved judgment until a time closer to trial. The case ultimately proceeded towards trial and was presented to a jury in May 2023.

Based upon all evidence presented at trial, the jury ultimately found that BNSF’s negligence was a contributing cause of Mr. Kemper’s mesothelioma and eventual passing. The jury awarded $1 million to the estate for Mr. Kemper’s conscious pain and suffering and $500,000 in pecuniary damages to Mrs. Kemper individually.

Following the jury verdict, Mrs. Kemper moved for an entry of final judgment notwithstanding BNSF’s intent to seek a setoff. With this motion, Mrs. Kemper included an updated spreadsheet detailing the payments of nearly $610,000 that Mr. and Mrs. Kemper had received from asbestos trusts and confirmed that Mr. Kemper received over $40,000 in disability benefits from the VA. Despite acknowledging that other courts had allowed setoffs in similar situations based upon the notion that there should be no “double recovery”, Mrs. Kemper maintained that FELA prohibited this setoff — whether expressly or implicitly — that BNSF sought. The district court agreed with Mrs. Kemper by finding setoffs were “expressly prohibited by FELA.” The district court therefore entered a final judgment against BNSF for the full $1.5 million award.

The next day, BNSF filed a renewed motion for setoff, arguing that FELA did not preclude a set off for payments that Mr. and Mrs. Kemper had received from third parties as compensation for the same injuries and damages for which Mr. and Mrs. Kemper had sued BNSF. The district court, again, denied BNSF’s request for a set off.  BNSF subsequently appealed the district court’s ruling. On appeal, BNSF argued the district court erred since it should have reduced the damages awarded by the amount that the Kempers received from settlements with the asbestos bankruptcy trusts and the disability benefits that Mr. Kemper received from the VA.

In the case at bar, the Court of Appeals of Kansas initially recognized that compensatory damages are awarded to make a person whole, and thus a plaintiff may not recover compensation multiple times for the same injury. As such, the Court of Appeals of Kansas found the district court erred when it found that FELA did not permit a setoff.

In light of Federal Case precedent, the Court of Appeals of Kansas held BNSF was entitled to a dollar-for-dollar setoff for any payments that Mr. and Mrs. Kemper received from non-FELA sources as compensation for the same harm underlying the Kempers’ claims against BNSF. As such, BNSF was entitled to offset the damages owed by $649,489.73 — the total payments made from the asbestos trusts and the VA to Mr. Kemper, as listed in Mrs. Kemper’s posttrial Motion for Entry of Final Judgment.

The Court of Appeals of Kansas therefore reversed the district court’s judgment in this regard and remanded with directions to enter a judgment reflecting this setoff amount.

Read the full decision here.