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Monthly Archives: April 2008

Wal-Mart drops subrogation lawsuit

Wal-Mart Stores Inc. is dropping a controversial effort to collect over $400,000 in health-care reimbursement from a former employee who is confined to a southeast Missouri nursing home since she suffered brain damage in a traffic accident.

The world’s largest retailer said Tuesday in a letter to the family of Deborah Shank it will not seek to collect money the Shanks won in an injury lawsuit against a trucking company for the accident. For a complete report on Wal-Mart’s change of heart decision, click here.

We originally blogged about this story in November 2007 (click here to see that piece) after a federal appeals court in Missouri gave the green light to Wal-Mart’s egregious collection practices through subrogation. The efforts by Wal-Mart were condemned on many fronts. The LA Times called the move legal, but wrong (click here to read that opinion piece). The folks at Wal-Mart Watch called it moral bankruptcy (click here to read that opinion piece). The American Bar Association warned that some people who are injured and receive a settlement or verdict are getting a big surprise: more litigation from the health plan that paid their benefits and now wants the money back.

It’s good to see that the pressure paid off and that the family can move on with their lives.