Court of Appeals Rejects Claimant's Attempt to Levy Property of Employer for Workers' Compensation Payments

In Ha v. CMP Tactical Lazer Tag, No. 17-0687 (Iowa App. July 18, 2018), the Court of Appeals was asked to rule on a claimant's attempt to levy on the property of the employer.  The business was known by different names (AKA, Escape Chambers, CMP) and claimant alleged this was the same property where claimant worked when she suffered her work injury.  

Claimant was hired by AKA and continued to work for the facility after her injury in April of 2014.  In early 2014, the facility rebranded itself as CMP.  AKA later indicated that Ha was not an employee.  The agency case caption showed CMP as the employer, but had the same number as the claim against AKA.  CMP did not participate in the workers' compensation hearing and default was entered against CMP. 

Claimant filed for a motion for entry of judgment against CMP in district court.  The district court entered judgment against CMP and claimant attempted to garnish CMP's bank accounts.  Claimant attempted to levy against the property, but the property owner claimant that the building was leased by AKA and Escape Chambers and the levy was against CMP.  Ha sought to clarify the order and argued successor liability. AKA and Escape Chambers indicated they were distinct entities.  Claimant submitted paychecks made out to her by AKA, but the court accepted the claim these were not payroll checks because they did not reveal withholding information.  The district court found Ha had not demonstrated a connection between CMP, AKA and Escape Chambers at the time of the injury.

The Court of Appeals finds that the district court's ruling that AKA, CMP and Escape Chambers were not all the same entity was supported by substantial evidence.  The court rejected the claim that CMP and Escape Chambers were mere continuations of AKA.  Claimant had noted that all three entities had the same facility, same phone number, same business model and same owners and managers.  The court finds that claimant had the burden of showing that a transaction took place between
AKA, CMP and Escape Chambers and because she had not done so, could not prove that the transaction was fraudulent.  The court also held that Ha had not submitted any evidence to indicate that CMP had common owners or interests with AKA or Escape Chambers.  Because Ha had not shown successor liability, her claim was dismissed.

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