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Authorization to settle the matter of Anthony Panozzo (“Plaintiff”) v Chicago Housing Authority, Apex Construction Group and Anderson Elevator - Case No. 2023 L 6740.
presenter
Presenter: Elizabeth Silas, Deputy General Counsel
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Recommendation
The Chief Executive Officer (“CEO”) of the Chicago Housing Authority (“CHA”) recommends that the CHA Board of Commissioners (“Board”) approve a settlement agreement to compensate Plaintiff for personal injuries he suffered at a CHA property - Judge Fisher Apartments (“Fisher”) while working as a subcontractor at the site on October 8, 2020.
The CHA retained Apex Construction (“Apex”) in July of 2019 to perform general construction services. Apex hired Anderson Elevator (“Anderson”) as its subcontractor. Plaintiff, who was 31 years old at the time of the incident, was employed by Anderson’s subcontractor Motion Solutions and was on-site at Fisher that day to perform elevator maintenance. Habitat is CHA’s property management firm for Fisher and was added as a third-party defendant after substantial completion of discovery in this litigation. Pursuant to CHA’s management contract and insurance coverage afforded to our management firms through CHA’s Property Managers Insurance Program, we are also defending Habitat in this litigation.
On October 8, 2020, while Plaintiff was descending the metal stairs/ladder from the elevator mechanical room to the main floor of the access room, the bottom rung shifted, which caused him to lose his balance. To avoid falling, plaintiff reached for the side rung, which forced his shoulder into hyperflexion and abduction, causing a labral tear (i.e., cartilage surrounding ball and socket portion of shoulder joint) and requiring surgery, including a bony Bankart procedure (i.e., repair of broken socket rim with screws or anchors). The injury required him to have multiple surgeries and significant physical therapy. He incurred medical bills of $275,000 and one of his treating physicians testified that he will likely need an additional surgery in the future because of shoulder instability. This would likely add an additional $100,000 of medical expense. The injury also caused him to remain off work since the date of the fall. His lost wage claim is approximately $200,000 and his employer’s insurer has a statutory workers compensation lien on any recovery Plaintiff may make through this litigation.
Plaintiff made a settlement demand of $3,250,000. On February 15, 2024 a mediation was held through ADR Systems. Retired Circuit Court of Cook County Judge Axelrood presided over the parties’ discussions. In addition to counsel for CHA and Habitat, representatives of the insurance carriers for Apex, Anderson and the worker’s compensation company also made themselves available for the mediation. After approximately six hours of negotiations, the parties reached an overall settlement of $ 1,250,000, subject to approval by the CHA’s Board of Commissioners.
Of this amount, Apex will pay $50,000, Anderson will pay $50,000, and CHA will pay $1,150,000. Settling this matter as set forth above is in the CHA’s best interest because the severity of the injury and the likelihood of future surgeries and medical care, resulting in additional lost time from work could easily result in a jury verdict in excess of the initial demand of $3,250,000.
The requested action complies in all material respects with all applicable federal, state and local laws, and CHA policies. Staff has completed all necessary due diligence to support the submission of this initiative.
Respectfully Submitted:
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Tracey Scott
Chief Executive Officer