Wal-Mart ends effort to seize trust fund

A severely injured Jackson woman whose family fought Wal-Mart for more than two years to keep the giant retailer from seizing a trust fund set up for her care lost every court battle but ended up winning the public relations war.

A little more than a week after the U.S. Supreme Court refused to hear an appeal from attorneys for Debbie and Jim Shank, the Bentonville, Ark., company -- the world's largest retailer -- wrote the Shanks what amounted to a letter of surrender.

"I'm grateful Wal-Mart has seen their error and decided to rectify it," Jim Shank said in a statement issued Tuesday. "I just wish it hadn't taken so long. This never should have happened. I sincerely hope no other family has to go through this. My thanks go first and foremost to my lord and savior Jesus Christ for the strength to bear under all this. Thanks also to the citizens of the United States -- it wasn't me who made this happen, it was the outcry of the people, and if there is a lesson in this story, it's that 'we the people' still means something."

Debbie Shank's story, in addition to gaining publicity in Southeast Missouri, was featured on several national news shows broadcast by NBC, CNN, Fox News and others, with national magazine and newspaper articles also bringing the case to public attention.

Wal-Mart used a practice called subrogation to assert its claim that it was owed compensation for its expenses when Debbie Shank was injured in a vehicle accident in 2000. Shank suffered brain damage and other injuries when a tractor-trailer slammed into her minivan.

Shank won a $1 million settlement from the trucking company, GEM Transportation Inc. Of that amount, $200,000 was set aside for Jim Shank, and he received $119,000 after legal expenses. Debbie Shank's settlement amount was $700,000, which after legal expenses were deducted amounted to $417,477. The money was put in a trust fund for her care.

Jim Shank recently estimated that between $270,000 and $300,000 remains in the fund, which has been frozen since the court case opened. Wal-Mart claimed it was owed more than $469,000 for Shank's medical expenses.

Debbie Shank worked as a stock clerk at night at the Jackson Wal-Mart.

In a statement issued late Tuesday, Wal-Mart said that while it had done the legally correct thing in protecting the medical plan's assets, public opinion had shown that the action was wrong.

"Occasionally others help us step back and look at a situation in a different way," the company's statement said. "This is one of those times. We have all been moved by Ms. Shank's extraordinary situation."

'We are sorry'

The plan's rules aren't flexible enough to account for individual situations, the company said, and it intends to review the rules to allow more "discretion" in individual cases while protecting the plan.

"Wal-Mart will not seek any reimbursement for the money already spent on Ms. Shank's care, and we will work with the family to ensure the remaining amounts in the trust can be used for her ongoing care," the company said. "We are sorry for any additional stress this has put on the Shank family."

Jim Shank could not be reached for comment, but Nathan Shank, Jim and Debbie's 17-year-old son, said the Wal-Mart decision means his mother's life will be better. She lives at Monticello House, a Jackson nursing center, and can now be moved back to a private room. Prior to the lawsuit, Debbie Shank also had a paid caregiver.

"It will be a lot easier on us," Nathan Shank said.

The stress of her mother's condition and the court loss with Wal-Mart made Nathan Shank almost give up on going to college, he said. Even while the Supreme Court was considering whether to take the case, he was making plans for after high school. "Quickly, after we lost, I was changing my plans because I was not even sure I would be able to afford college," he said.

Nathan Shank said public opinion changed the outcome. "I am pretty sure they had seen all the bad publicity they were getting and couldn't handle it."

During the case, the Shanks also lost one of their three sons when Jeremy, 18, was killed in Iraq while serving in the Army.

Debbie Shank's condition will not improve with time. Jim Shank said recently. "She is just aware enough of what is going on to be miserable," he said. "She is 52 years old and knows she lives in a nursing home and that is as good as it is going to get."

'This is the final straw'

The Southeast Missourian has received numerous requests for information about donating to the Shank family after the Supreme Court decision. One person who called, Ben Jeffries of Louisville, Ky., said stories about the case had prompted his wife and him to vow never to spend money again at a Wal-Mart store. He admitted he is not a fan of Wal-Mart.

"We read this the other day and said this is the final straw," Jeffries said. "I will drive 40 miles out of my way. If I had a bullhorn, I would say take the next $5 you would spend at Wal-Mart and give it to the Shanks. I understand they have a legal right, but there is also a moral issue here."

A fund set up at Bank of America accepts donations for Debbie Shank through any branch office. Wal-Mart Watch, the union-funded organization critical of Wal-Mart's employment and business practices, helped lead the publicity campaign and matched donations to Debbie Shank. The case put a spotlight on the growing use of reimbursement claims by health plans, experts say.

Roger Baron, professor of law at the University of South Dakota and a specialist in health-plan law, said health plans have become "very aggressive" about subrogation since a 2006 Supreme Court decision that enhanced companies' ability to seek the reimbursements.

"It's free money. They want the free money," Baron said.

Lynn Dudley, vice president for policy at the American Benefits Council in Washington, D.C., said the negative publicity around the case was beginning to draw the attention of lawmakers who might want legislation to stop or limit subrogation.

"Capitol Hill is paying attention," Dudley said.

The Associated Press contributed to this report.

rkeller@semissourian.com

335-6611, extension 126

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