Carroll v. Lanza

Carroll (plaintiff) worked for Hogan. Both Carroll and Hogan were Missouri residents, and that is where the employment contract was made. Hogan was a subcontractor for Lanza (defendant). Carroll was injured when she was working for Hogan on a job in Arkansas. Carroll received weekly benefits under Missouri’s workers’-compensations laws—unaware that he had remedies under Arkansas law. Because Carroll’s employment contract with Hogan was made in Missouri, Carroll qualified for Missouri benefits. Both the Missouri and Arkansas workers’-compensation laws purported to provide exclusive remedies—but the exclusivity of the Arkansas remedy did not apply to a third party like Lanza. Thus, Carroll sued Lanza in a state court in Arkansas for common-law damages. Carroll’s state-court case was removed to federal court in Arkansas, and both the district court and circuit court of appeals agreed that Arkansas law permitted a judgment against Lanza, but the court of appeals reversed the district court’s judgment for Carroll on grounds that full faith and credit barred Carroll’s recovery from Lanza. Carroll appealed, and the United States Supreme Court granted certiorari because of its previous decision in Pacific Employers Insurance Co. v. Industrial Accident Commission, 306 U.S. 493 (1939), which held that full faith and credit did not prevent a California court from applying California’s workers’-compensation law in a suit by a Massachusetts worker against its Massachusetts employer for injuries the worker suffered in California.