Kalama Services, Inc Cigna Property and Casualty Insurance Company v. Director, Office of Workers Compensation Programs

We hold today that the Benefits Review Board did not err in ruling that injuries suffered by an off-duty employee during foreseeable horseplay in a bar on Johnston Atoll arose out of a “zone of special danger” created by the isolation of the island and the limited recreational opportunities available there.

Facts and Procedural History

Johnston Atoll is a United States possession, located about 700 miles west-southwest of Hawaii in the Pacific Ocean. It is only two miles long and one-half mile wide. The United States military uses the atoll to store and dispose of chemical, nuclear, and other toxic weapons. Certain standards govern the conduct of inhabitants at all times during their stay on the atoll. For example, gambling and fighting are prohibited.

The United States government contracted with Kalama to provide operational and maintenance services on the atoll. In August 1996, Kalama hired Michael Ilaszczat to manage the Self Help Store on the atoll. The Self-Help Store serves local residents with materials and tools for projects. In December 1996, Ilaszczat injured his left leg in a work-related accident. As a result of this injury, Ilaszczat had a total left knee…