Amicus Briefs Filed
Amicus curiae is a legal Latin phrase, literally translated as “friend of the court.” It is the name for a brief filed with the court by someone who is not a party to the case.
With Fred Hiestand at the helm of CJAC’s Appellate Program, CJAC regularly files such “friend of the court” briefs on issues of concern to its broad membership of businesses, professional associations, and local governments, in an effort to offer information and assist the court in deciding particular cases.
Recently Filed Amicus Briefs
Richey v. AutoNation, Inc. - California Supreme Court - 8/8/13: The issue: where parties to an employment contract agree to submit all future disputes between them to binding arbitration and specify that the arbitrator shall decide those disputes based solely upon “controlling law,” but say nothing in that contract about judicially appealing the arbitrator’s decision or the standard of review applicable to any such appeal, may an arbitral decision pursuant to that agreement be judicially vacated on the ground that its exoneration of the employer from liability under the California Family Rights Act due to the “honest belief” defense is “clearly erroneous” as a matter of law?
CJAC contends that the "honest belief" defense to CFRA liability is NOT clearly erroneous as a matter of law because numerous federal opinions are in conflict as to its viability under the Federal Medical Leave Act and no California case (save this one) has ruled on its applicability to the CFRA. Moreover, sound law and public policy favor the finality of private, contractual arbitration and countenance against judicial set asides of arbitration awards unless the parties thereto specifically and clearly consent to that authority. (Richey v. AutoNation, Inc., S207536, brief filed on 8/8/13)
Richey v. AutoNation Decision Rendered – 1/29/15: The California Supreme Court released an opinion January 29, 2015 in Richey v. AutoNation, Inc. (S207536). CJAC filed an amicus brief in this arbitration case in August 2013.
As expected (based on questions posed by the Justices at oral argument in November), the Court sided with CJAC's arguments and upheld the arbitrator's decision and reversed the appellate opinion.
The issue: where parties to an employment contract agree to submit all future disputes between them to binding arbitration and specify that the arbitrator shall decide those disputes based solely upon “controlling law,” but say nothing in that contract about judicially appealing the arbitrator’s decision or the standard of review applicable to any such appeal, may an arbitral decision pursuant to that agreement be judicially vacated on the ground that its exoneration of the employer from liability under the California Family Rights Act due to the “honest belief” defense is “clearly erroneous” as a matter of law?
CJAC contended the "honest belief" defense to CFRA liability is NOT clearly erroneous as a matter of law because numerous federal opinions are in conflict as to its viability under the Federal Medical Leave Act and no California case (save this one) has ruled on its applicability to the CFRA. Moreover, sound law and public policy favor the finality of private, contractual arbitration and countenance against judicial set asides of arbitration awards unless the parties thereto specifically and clearly consent to that authority.
In the 14-page, unanimous opinion authored by J. Chin, the Court concluded that whether the honest belief defense applies when an employer terminates an employee based on a reasonable belief that the employee is violating company policy while on CFRA or FMLA leave is an unsettled question of law. We need not resolve that question in finding that the arbitrator here made no legal error that deprived the plaintiff of an unwaivable statutory right when it relied upon the substantial evidence that plaintiff violated company policy.
Click here to read the opinion.
CLS Transportation Los Angeles v. Iskanian – U.S. Supreme Court - 10/24/14 – The issue before the U.S. Supreme Court on a Petition for Writ of Certiorari is whether California’s Private Attorney General Act (PAGA) – consistent with the Federal Arbitration Act and the Supremacy Clause – can authorize any employee to sue (in a “representative” capacity) his or her employer for an array of state Labor Code violations with “fines” to be shared between prevailing plaintiffs and the state, but preclude parties to such actions from resolving their employment disagreements by private arbitration despite a pre-dispute agreement between them to do just that.
CJAC, joined by the California Chamber of Commerce, argue the California Supreme Court’s opinion below wrongly extends the reach of PAGA beyond the preemptive sweep of the Federal Arbitration Act (FAA), creating a barrier to the use of arbitration that, unless razed, effectively kills it as a means for deciding many, if not most, employment disputes in this state. This conflicts with the purpose and language of the FAA and the U.S. Supreme Court’s numerous opinions explaining the FAA's scope and application. Left undisturbed, the California Supreme Court opinion will up-end pre-dispute arbitration agreements between employees and employers, forcing them into clogged, overburdened courtrooms for the determination of their differences by more costly and time-consuming litigation.
The Petition for Cert was filed after the California Supreme Court’s decision in June 2014 when the Court ruled that arbitration cannot substitute for an action brought under the state’s PAGA, a broad ranging qui tam-type statute that permits an employee as a “bounty hunter” to prosecute a representative claim on behalf of employees against an employer for violating a panoply of (wage/hour and public health and safety) laws. PAGA lawsuits cannot, despite the FAA, be waived by arbitration.
CJAC’s brief supporting “cert” can be found here.
The California Supreme Court’s opinion can be found here.
CJAC’s amicus brief before the California Supreme Court can be found here
Sanchez v. Valencia Holding Company, LLC - California Supreme Court - 10/1/12: This issue in this case is whether the Federal Arbitration Act, as outlined by AT&T v. Concepcion, bars use of state unconscionability law to invalidate an arbitration agreement in a retail automobile sales contract because it (1) permits an internal arbitral appeal process to a three-person panel for extreme outlier results, (2) requires the losing party to advance costs for an internal arbitral appeal, and (3) excludes from arbitration self-help relief.
CJAC and Cal Chamber argue that the appellate court's decision here should be reversed because the FAA preempts use of state law on unconscionable contracts to stand as an obstacle to the execution of private, binding arbitration agreements. Merely requiring "procedures incompatible with arbitration" violates the FAA; and any procedure that interferes with a "streamlined" arbitration proceeding is prohibited. The arbitration agreement at issue clearly comports with federal law; and, to the extent its provisions conflict with state law defining unconscionable contracts, state law must yield to the broad preemptive sweep of the FAA. However, the specific provisions of this arbitration agreement are neither procedurally nor substantively unconscionable. They meet the Concepcion standard for providing a "streamlined procedure tailored to the type of dispute." (Sanchez v. Valencia Holding Company, LLC, S199119, Brief filed on 10/1/12)
Haver v. BNSF Railway Company – California Supreme Court – 3/20/15 – CJAC submitted an amicus brief to the California Supreme Court on March 20, 2015 in Haver v. BNSF Railway Company, S219919. This is a "take home" asbestos case related to Kesner v. Superior Court, which is also pending before the Supreme Court (and a case in which we filed in amicus brief earlier this month). This time around, CJAC is joined by the California Chamber of Commerce.
The issues here is: Does an employer whose business involves the use or manufacture of asbestos-containing products owe a duty of care to members of an employee's household who could be affected by asbestos dust brought home on the employee's clothing?
In this case, the trial court sustained defendant's demurrer to the complaint and a majority appellate court opinion affirmed that judgment. CJAC and the Cal Chamber agree with both courts' decisions and, in our brief, share two concerns about what an opinion reversing them threatens: imposition of an additional deleterious impact on a segment of the business community already hard-hit by an "elephantine mass" of lawsuits; and second, a rule of law that essentially imposes "absolute" and "limitless" liability on defendants.
To read the brief, click here.
Kesner v. Superior Court (Pneumo Abex, LLC) - California Supreme Court – 3/12/15 - On March 12, 2015, CJAC submitted an amicus brief in this "take home" asbestos case before the California Supreme Court, Kesner v. Superior Court (Pneumo Abex, LLC), S219534.
The principal issue is whether an employer owes a duty under negligence law to warn those who do not live with but visit the homes of family member workers about dangers from – or take precautions to prevent their exposure to – asbestos dust carried home by their employees on their work clothes.
According to the trial court, the defendant owes "no duty" to plaintiff, who never visited or came near the defendant employer's plant, for his exposure through contact with take-home asbestos dust on his uncle's (an employee of defendant) work clothes when plaintiff visited him at his home. The appellate opinion reversed this "no duty" ruling, holding instead that "the likelihood of causing harm to a person [who has secondary] contact with the [defendant's] employee, in this case [the home of plaintiff's] uncle, is sufficient to bring [plaintiff] within the scope of those to whom the [defendant] . . . owes the duty to take reasonable measures to avoid causing harm."
CJAC believes the trial court decided correctly; and that a contrary holding of "duty" under the circumstances of this case extends liability beyond reason and fairness. Indeed, if duty is affirmed here, it will cinch defendant's liability to third party bystanders as well as the future liability of others by effectively converting negligence law into absolute liability for manufacturers of asbestos and other toxic containing products, employers whose employees work with those products, and owners who lease buildings to those manufacturers and employers.
Click here to read the brief.
Griggs v. Owens Illinois – First Appellate District (Div. 3) – 8/28/14: CJAC submitted an amicus brief August 28, 2014, in the First Appellate District (Div. 3) in the asbestos case of Grigg v. Owens-Illinois, Inc., A139597.
CJAC focused on two issues in its brief:
(1) Should the manufacturer of an asbestos containing insulation product (“Kaylo”) be held liable to the spouse of an employee for various independent contractors who, after cutting and shaping Kaylo in the 1950s to insulate pipes and boilers in commercial buildings, took home residual asbestos dust on his clothes and exposed his spouse to it?; and, if so,
(2) Is the relaxed Rutherford cause-in-fact standard for asbestos cases, which does not require any showing that the defendant’s product actually caused the plaintiff’s injury, a constitutionally sufficient ground to assess punitive damages, and was the punitive damage award, made under that standard, excessive?
The trial court answered “yes” to those questions, approving a stipulated amount of $42,500 for plaintiff’s economic loss and the jury’s award of $27 million ($12 million for her pain and suffering, $4 million for her second husband’s loss of consortium, and $11 million in punitive damages). CJAC argues the jury’s determination of liability for compensatory and punitive damage awards, however, was the result of erroneous court rulings and instructions on substantive and procedural law, rulings that essentially made the defendant manufacturer absolutely liable for the plaintiff’s mesothelioma.
To read the brief, click here.
Paulus v. Crane. Co. – CJAC Letter Brief – 06/11/2014: CJAC letter brief submitted to the California Supreme Court June 11, 2014 urging review of Paulus v. Crane Co., S218222. The issue is whether courts approving damage awards have authority to enter accompanying remedial orders to prevent (or at least deter) plaintiffs from “double dipping,” that is, getting or trying to get paid again by someone else for the same injuries underlying the judgments.
To read the letter brief, click here.
Woodard v. Crane Co. - Second Appellate District - 6/21/11: This is an asbestos case concerning the scope and application of the “component parts” defense in product liability law. Specifically, should component parts manufacturers be liable for failure to warn when the component is not inherently dangerous and the manufacturer had no role in its end design, even if it was foreseeable the component could, once outside the manufacturer’s control, be combined with other products that are defective and cause consumer injury?
The fact pattern in these types of case is becoming all too familiar: a plaintiff contracts mesothelioma from working many years ago in the Navy on ships whose boiler systems contained valves or pumps (i.e., “component parts”) manufactured by private companies pursuant to the Navy’s specifications. These valves and pumps required periodic packing and replacement of gaskets supplied by others that could conceivably, but not necessarily, contain asbestos. The people who contract mesothelioma from exposure to asbestos when repairing or replacing packing or gaskets connected to the valves can’t sue the Navy because of sovereign immunity, so they turn their sights to component parts manufacturers.
CJAC argues it is unfair and ineffecient to impose liability upon a component part maker for defects in the final product over which it has no control. (Woodard v. Crane Co., B219366, CJAC amicus brief filed on 6/21/11)
Woodard Decision Rendered - 8/25/11: The Second Appellate District, in a unanimous opinion, came to the same conclusion as CJAC in our amicus brief, ruling that Crane Co. owes no duty to the plaintiff because Crane is a component parts manufacturer and did not contribute to the overall design of the product that allegedly caused the plaintiff’s mesothelioma.
Nickerson v. Stonebridge – California Supreme Court – 7/8/14: CJAC submitted on July 7, 2014, an amicus brief to the California Supreme Court in Nickerson v. Stonebridge LIfe Insurance Co., S213873. The issue presented: Is an award of attorney fees under Brandt v. Superior Court properly included [in a court’s due-process review of a punitive damage award] as compensatory damages where the fees are awarded by the jury, but excluded from compensatory damages when they are awarded by the trial court after the jury has rendered its verdict?
The appellate opinion answered “Yes” to this question, stating “Brandt fees are not properly included in determining the compensatory damage award when they are awarded by the trial court after the jury awards punitive damages.”
CJAC is urging the Court to affirm the court of appeal's decision, arguing that due process requires that damage awards be based on evidence presented to the jury; and that a defendant be allowed to present to the jury all available defenses on liability and damages. Thus, evidence the jury hears to determine attorney fees in insurance bad faith claims (Brandt fees) may be added to the compensatory damage category and considered in determining whether the size of the punitive damage award in relation to it comports with due process proportionality. Attorney fees determined by the court post-verdict, however, should not be factored into any compensatory/punitive damage ratio as they were not evidence of damages as determined by the trier of fact.
Should the jury determine Brandt fees, that amount would properly be considered as “recoverable . . . damages resulting from a tort in the same way that medical fees would be part of the damages in a personal injury action.” But when, as here, the jury never hears of these fees because they are determined by the court post-verdict, it would be improper for the court to add them into either the verdict for compensatory or punitive damages in its calculation of a ratio based on evidence never heard or considered by the jury.
To read the brief, click here.
Design Defect/Third Party Liability
Beacon Residential Community Association v. Skidmore, Owings & Merrill – CJAC Amicus Brief – 09/26/2013: CJAC submitted an amicus brief September 26, 2013 in Beacon Residential Community Association v. Skidmore, Owings & Merrill, S208173. This case before the California Supreme Court involves two architectural firms who contracted to design a mixed commercial/residential complex in San Francisco called The Beacon. After the complex was completed and purchased by another developer, who sold many of the condo units, the homeowners association brought suit against more than 40 defendants, including the design professionals, claiming defects caused by negligent design.
There are two related issues this case presents -- Does the Right to Repair Act abrogate the common law "duty" defense applicable to the liability of "design professionals" toward future third-party owners of a building for whom the designers have no express contractual obligation; and, if not, do those who design a building for developers pursuant to a written contract between them, but have no direct involvement in its construction, owe a duty of care to its ultimate owners under the negligent design tort?
The appellate court answered "yes" to both questions, reversing the trial court and creating a new liability rule in conflict with long-standing precedent, common sense, and sound public policy. CJAC argues that, unless reversed, this opinion will impose untoward costs on design professionals, increasing the price of housing and commercial buildings to the detriment of the public and the economy.
To read the brief, click here.
Beacon Decision Rendered - 07/03/2014: The California Supreme Court on July 3, 2014, held that the principal architect who is not subordinate to other design professionals owes a duty of care to future homeowners for design defects in the building that manifest after its resale. Beacon Residential Community Association v. Skidmore, Owings & Merrill LLP, S208173.
CJAC filed a "friend of the court" brief last year arguing that common law and contractual defenses preclude an extension of liability for architects beyond those for whom they were hired to design the building – e.g., the original owners and builders, and not future third parties who later buy the building and discover its latent defects. Defendants and CJAC argued that a line of cases from the Court refusing to extend liability of accountants and other professionals to third-parties were applicable here for the same reasons given there. The Court, in a unanimous opinion by Justice Goodwin Liu, disagreed, stating that while “a common law duty of care may be required to maintain a negligence action . . . such a duty exists under the facts alleged here.”
The case arose on a demurrer to the complaint, a procedural device which admits the truth of the facts asserted but argues the law affords plaintiffs no relief. The Court’s opinion emphasizes those facts in extending architectural liability to third-party future homeowners: “Defendant [architects] applied their specialized skill and professional judgment throughout the construction process to ensure that it would proceed according to approved designs. . . [and] played a lead role not only in designing the Project but also in implementing the Project design.”
The opinion concluded that “the chief interest of prospective homeowners is to avoid purchasing a defective home, not only to have adequate redress after the fact. . . . [H]olding architects as independent professionals directly accountable to third party homeowners is most likely to vindicate that interest.”
To read the opinion, click here.
Duran v. U.S. Bank – California Supreme Court – Oral Argument – 03/04/2014: The California Supreme Court heard oral argument in Duran v. U.S. Bank (S200923) on March 4 in San Francisco. CJAC (joined by the California Business Roundtable and California Bankers Association) filed an amici brief in this case in 2013.
The answers to the two principal issues on this appeal — (1) whether class action defendants have a due process right to defend themselves against the claims of individual class members and, if so, (2) whether that right can be abridged by allowing plaintiffs to rely on representative testi¬mony and statistical evidence as a substitute for common proof of class¬wide liability — will determine whether procedural efficiency trumps the substantive rights of California’s class action defendants.
In this wage and hour class action employment case that resulted in a $15 million judgment, the Court of Appeal held that one-third of the absent class members were properly classified by U.S. Bank as exempt from eligibility for overtime and, hence, have no claim. For that reason, the Court of Appeal reversed the trial court’s order, recognizing that the class action device cannot best substantive law or confer on uninjured persons a right to recover where none otherwise exits.
The vice of the trial court’s “plan” is that it prevented U.S. Bank from litigating its individual defenses as to each class member, and relied on sampling and extrapolations to the stars to determine classwide liability. In our amici brief, we explained why the trial court was wrong and Court of Appeal’s judgment of reversal should be affirmed.
To read the brief, click here.
Duran Opinion Rendered – 05/29/2014: The California Supreme Court released its unanimous opinion in the Duran case, holding that in a wage and hour class action based on statistical sampling to determine the scope of liability and extent of damages, "a trial management plan must permit the litigation of relevant affirmative defenses, even when these defenses turn on individual questions." Failure to allow the litigation of pertinent affirmative defenses that turn on individual defenses violates, the Court stated, the defendants' due process rights.
The opinion states:
The appellate court's reversal of the judgment for plaintiffs must be affirmed because "flawed implementation of sampling prevented [the defendant bank] from showing that some class members were exempt and entitled to no recovery. A trial plan that relies on statistical sampling must be developed with expert input and must afford the defendant an opportunity to impeach the model or otherwise show its liability is reduced. [While] statistical sampling may provide an appropriate means of proving liability and damages in some wage and hour class actions [, in this case] . . . the trial court‘s particular approach to sampling . . . was profoundly flawed."
To read the opinion, click here.
Verdugo v. Target - California Supreme Court - 11/4/2013: The issue (certified by the Ninth Circuit for decision by this court) is: under what circumstances, if ever, does the common law duty of a retail store owner to provide emergency first aid to invitees require the owner to have an Automatic External Defibrillator (AED) on the premises for cases of sudden cardiac arrest?
Plaintiffs assert a common law duty in tort for defendant to have an AED on its premises. We argue to the contrary, that the Legislature has determined that retail stores owe “no duty” to their guests to keep and maintain a defibrillator on their premises for the rescue of guests who may suffer cardiac arrest. The Legislature has enacted numerous statutes governing the placement and attendant responsibilities of certain types of facilities for maintenance, testing, and training of employees respecting the use of defibrillators – and, most importantly, exempted retail stores such as defendant from any duty to have AEDs on their premises.
Even assuming arguendo the absence of specific legislative language dictating this result, the common law duties of landowners, who have a “special relationship” with their invitees, does not extend so far as to require them to provide AEDs on their premises. The extent of a property owner’s common law duty to come to the aid of a sick or injured invitee, is limited to promptly summoning emergency services, not providing them directly.
Verdugo Decision Rendered – 06/23/2014: The California Supreme Court released an opinion on June 23, 2014, in Verdugo v. Target Stores, S207313. CJAC, joined by the California Chamber of Commerce, filed an amici "friend of the court" brief in this case in November 2013.
The issue (certified by the Ninth Circuit for decision by this court) is: under what circumstances, if ever, does the common law duty of a retail store owner to provide emergency first aid to invitees require the owner to have an Automatic External Defibrillator (AED) on the premises for cases of sudden cardiac arrest?
Plaintiffs asserted a common law duty in tort for defendant to have an AED on its premises. However, the Court sided with CJAC's arguments and concluded that Target's common law duty of care to its customers does not include a duty to acquire and make available an AED for use in a medical emergency.
To read the opinion, click here.
Cortez v. Abich - California Supreme Court - 6/24/10: The issue in this case is whether homeowners who hire unlicensed contractors to undertake extensive remodeling of their personal residences are liable in tort under Cal-OSHA and Labor Code section 2750.5 to workers hired by the contractors for injuries they sustain while working on the remodel.
CJAC argued in its amicus brief that imposition of Cal-OSHA requirements upon homeowners to injured third-party workers hired by unlicensed contractors for remodeling the homeowners’ personal residence is contrary to legislative intent, the purpose of Cal-OSHA and applicable contract licensing laws. It also runs afoul of the “unclean hands” doctrine. CJAC urged the Court to overturn the appellate court decision and affirm the trial court’s ruling.
Cortez Decision Rendered - 1/24/11:The Supreme Court agreed with CJAC’s amicus brief and unanimously ruled that extensive home remodeling is not within the statutory exception of “household domestic service”, which would allow defendants to escape liability for an “employee’s” injury.
Employee Meal and Rest Breaks
Hohnbaum et al. v. Brinker Restaurant Corporation - California Supreme Court - 8/18/09: This case addresses the issue of whether employers are required to ensure that their employees take meal and rest period breaks or that they are only required to make these breaks available to employees and not force them to work through the break periods. Also at issue is whether a case brought by employees alleging meal and rest break violations by their employers should be certified as a class action.
CJAC argues in our amicus brief that employees are free to choose whether to take a meal or rest breaks “provided” them by their employer and to waive their rights to these breaks for their own reasons. If an employee decides to not take a break it does not mean their employer is in violation of Labor Code provisions requiring it make the breaks available.
Also, employer liability for off-the-clock work requires proof that the employer knew or should have known employees were doing this contrary to express company policy, so class certification is not appropriate in this case.
Hohnbaum Decision Rendered - 4/12/12: The Supreme Court unanimously agreed with CJAC's argument that while employers are required to make breaks available, employees are at liberty to use the periods as they wish and the employer need not ensure that no work is done.
The Court found that the view that an employer must ensure no work is done -- i.e., prohibit work -- lacks any textual basis in the wage order or statute at issue. "Indeed, the obligation to ensure employees do no work may in some instances be inconsistent with the fundamental employer obligations associated with a meal break: to relieve the employee of all duty and relinquish any employer control over the employee and how he or she spends the time."
Elder Abuse Act
Winn v. Pioneer Medical Group, Inc.- CJAC Amicus Brief – 04/03/2014: CJAC submitted an amicus brief April 3, 2014, to the California Supreme Court in Winn v. Pioneer Medical Group, Inc. (S211793). The issue in this case is whether "neglect" within the meaning of the Elder Abuse Act includes a physician's failure to refer an elder patient to a medical specialist if the care provided that patient by the physician is on an "outpatient" basis and the physician has no custodial relationship with the patient.
Plaintiffs are the heirs of the decedent, who was a competent and independent elderly adult. Plaintiffs allege that, in the course of treating decedent at their private offices, defendants failed to recognize the need for a vascular specialist to evaluate decedent's foot, which led to the amputation of her leg and, ultimately, her death. Plaintiffs filed two separate lawsuits -- one for professional negligence (governed by MICRA) and one for Elder Abuse neglect, which gives rise to "enhanced remedies" and which is not subject to MICRA.
CJAC argues that claims for professional negligence against physicians and claims against them for "neglect" under the Elder Abuse Act are "mutually exclusive." A claim against a doctor for refusing to refer a patient to a medical specialist is classic "professional negligence." It does not rise to the level of a claim for "neglect" under the Act unless the conduct that is the gravamen of the complaint is the refusal to provide medical services (instead of providing them carelessly), is egregious beyond negligence or even gross negligence, and is accompanied by some custodial relationship or function the physician has with the elderly patient who is aggrieved by his or her treatment.
When, as here, a doctor treats a patient solely on an outpatient basis and that patient is not in a custodial setting, there can be no "neglect" under the Act for failing to refer the patient to a medical specialist. A common sense reading of the Act and the California Supreme Court’s previous gloss on it underscores the correctness of this conclusion.
The professional negligence action is still pending in the superior court. The Elder Abuse action (at issue here) ended with dismissal by the trial court, which was reversed by the Second Appellate District (Div. 8) in a published 2-1 opinion.
To read the brief, click here.
Chan v. Curran, MD -- CJAC Amicus Brief - First Appellate District - 6/4/2014 - CJAC submitted an amicus brief on June 4, 2014 in the First Appellate District in Chan v. Peter Curran, MD, et al., A138234. This case represents another attack on the constitutionality of MICRA.
Here, plaintiff’s mother died from hemorrhagic bleeding as a result of the defendant doctor failing to carefully monitor the mother’s Coumadin level. After a jury awarded damages, defendant successfully had the $1 million non-economic portion reduced to $250K pursuant to MICRA.
CJAC’s amicus brief counters the arguments that MICRA’s cap denies due process because, in light of increases in the cost of court fees, depositions and experts, contingent fee attorneys no longer represent medical malpractice clients with modest (or no) economic damages, regardless of the extent of their non-economic damages.
We argue MICRA fully complies with the federal and state constitutions and does not violate the guarantee to due process or equal protection of the laws, nor the right to jury trial. To hold otherwise and strike down the damage limitation would conflict with well-reasoned and settled opinions for our state Supreme Court and intermediate appellate courts that have consistently upheld it in the face of constitutional challenge.
Chan v. Curran, M.D. Decision Rendered – 6/9/2015: The First District Court of Appeal released the MICRA opinion by in Chan v. Curran, M.D., A138234, a case on which CJAC submitted an amicus brief in 2014, and also participated in at oral argument in March of 2015.
In its 34-page unanimous, published decision authored by Justice Banke, the court thoroughly dissects and dismisses plaintiff's challenges to the constitutionality of MICRA. In fact, this opinion provides the best and most comprehensive reasons to date as to why those arguments do not wash.
To read the opinion, click here.
Rashidi v. Moser, MD - Second Appellate District - 6/6/13: This case is yet another skirmish in the trial attorneys' judicial assault on MICRA, as they search for an appellate court that will sympathize with their arguments that MICRA's $250,000 noneconomic damage ceiling violates guarantees to equal protection and the right to jury trial.
CJAC argues that MICRA is an exemplary law that did what it intended to do: rein in medical malpractice litigation costs and reduce premiums for med mal insurance by placing limits on the availability and extent of recovery, and making that recovery more predictable and certain. All of MICRA's sections have withstood repeated constitutional challenges in our state supreme court, intermediate appellate courts and federal courts. The state interests underlying MICRA have consistently been found to be legitimate and all its provisions, separately and in conjunction, have been declared reasonably related to the law's objectives. (Rashidi v. Moser, B237476, brief filed on 6/6/13)
Kristina Gavello, et al. v. Bernard Millman, MD - First Appellate District - 3/7/13: This case represents one round in a series of coordinated attacks in the appellate courts on the constitutionality of MICRA. CJAC's brief argues that controlling precedent, sound public policy, and well-settled and reasoned constitutional doctrine make clear -- the $250,000 ceiling on recoverable noneconomic damages in medical malpractice cases comports completely with federal and state constitutional safeguards. Plaintiffs' counsel know this, but continue to assert the opposite, a tactic apparently based on the notion that if one says something often enough, the courts may eventually come to believe it, despite all law and reason to the contrary. However, calling a law unconstitutional does not make it so, no matter how devoutly the caller wishes and repeats it. (Gavello, et al. v. Millman, A132291, brief filed on 3/7/13)
Gavello Decision Rendered - 7/9/13: Once again, a constitutional challenge to MICRA was rebuffed. In its unanimous, unpublished decision, the First Appellate District effectively picks apart the trial attorneys' arguments regarding equal protection and the right to jury trial. In addition, the court spends a lengthy amount of time on the Prop 103 argument and the fact that the trial court record contains no evidence regarding the impact of Pop 103, or any other allegedly relevant change of circumstance that would necessitate relitigating the constitutionality of MICRA. The court addresses the MICRA challenge on pages 19-27 of the opinion.
Hughes v. Pham - Fourth Appellate District - 9/18/2012: This case is the "next chapter" in the plaintiffs bar's attack on MICRA. They argue MICRA's cap on noneconomic damages has become more arbitrary and irrational over time, and that the "purported basis for its enactment has been eviscerated." They point to "changed conditions" since MICRA's enactment that render it in violation of the right to jury trial, separation of powers, due process and equal protection, and that MICRA fails strict scrutiny analysis and even rational basis review.
CJAC argues MICRA is a rational response to the 1975 medical malpractice insurance crisis, and is a model law that reined in med mal litigation costs and reduced premiums for med mal insurance. All of MICRA's sections intended to reduce med mal litigation costs have withstood repeated constitutional challenges. Arguments that the $250,000 cap is no longer viable because it did not achieve its purpose of dampening litigation costs (because Prop 103 did instead) and that the conditions prompting its enactment no longer exist are nothing new and have been repelled by every court to consider them. (Hughes v. Pham, E052469, Amicus Brief filed on 9/18/2012)
Personal Injury Damages
Dameron Hospital Association v. California State Automobile Association Inter-Insurance Bureau, et al.
The central issue this case presents is whether a hospital can prosecute a Hospital Lien Act claim against an auto insurer for the difference between what the hospital was paid to provide emergency treatment to a patient under a contracted medical plan and the amount the hospital considers the "fair market value" of the services it provided.
CJAC weighs-in here with the same concerns that prompted its participation in two analogous cases, Howell v. Hamilton Meats and Corenbaum v. Lampkin -- preventing satellite litigation to resolve economic value issues that, as a matter of practice and law, are readily and reasonably determined by market forces, i.e., by what hospitals are actually paid and accept from prepaid health plans for the medical care they render.
Dameron Decision Rendered – 7/30/14: Third Appellate District handed down its opinion July 30, 2014, in Dameron Hospital Association v. CSAA Inter-Insurance Bureau, C070475. In the unanimous, published opinion authored by Justice Hoch, the court affirmed the trial court's judgment for defendants, which is the result CJAC advocated for in its amicus brief filed last October.
As framed by the court in its opinion, the central question presented is: Does a health care service plan’s payment of a previously negotiated rate for emergency room services insulate the tortfeasor’s automobile liability insurer from having to pay the customary rate for medical care rendered? AAA and Allstate contend they are not responsible for any amount after Kaiser paid in full the bill for the emergency room services provided by Dameron. Dameron responds that it contracted with Kaiser to preserve its rights to recover the customary billing rates from tortfeasors and their automobile liability insurers. Dameron asserts the tortfeasors and their liability insurers are responsible for the entire bill for medical services at the customary rate –- not just the difference between the reimbursement received from Kaiser and the customary billing rate.
The court relied heavily on Parnell v. Adventist Health System/West (2005) 35 Cal.4th 595 in concluding "the Dameron/Kaiser contract does not contain the term described by the Parnell court as sufficient to preserve the right to recover the customary billing rate for emergency room services from third party tortfeasors. To paraphrase Parnell, if Dameron wishes to preserve its right to recover its customary billing rates through an Hospital Lien Act (HLA) lien, it is free to contract for this right. But Dameron must actually contract for this right. A history of voluntary cooperation with Kaiser does not suffice to avail Dameron of the Parnell court’s guidance on reservation of contractual rights under the HLA. Consequently, the trial court properly granted summary judgment in favor of AAA and Allstate."
To read the opinion, click here.
Varela v. Birdi - Fourth Appellate District, Div. 1. – 12/15/14: CJAC submitted December 15, 2014 an amicus brief in Varela v. Birdi (D064315) in the Fourth Appellate District, Div. 1. This case is a variation on the Howell/Corenbaum line of cases. The issue here is whether it is reversible error for a trial court to (1) bar defendant from presenting any evidence or asking any questions of witnesses about the amount of money reasonably likely to be paid for the plaintiff’s future medical expenses; and (2) instead permit, over defendant’s objections, plaintiff’s experts to testify about the amounts to be billed for those expenses when laying the foundation for the jury’s calculation of future special and general damages.
CJAC contends, inter alia, that the trial court’s rulings on the evidence relevant to prove future medical damages and noneconomic damages requires reversal because they conflict with recent on-point opinions by the Supreme Court and intermediate appellate courts, defies common sense, and if left undisturbed will have an escalating and deleterious effect on the cost of litigation and health care. We argue it is wrong as a matter of law for a trial court to allow, as happened here, expert testimony on a plaintiff’s future medical expenses to be based on amounts to be billed, and not actually paid, for that care. Recent well-settled and reasoned case authority holds that a plaintiff may recover no more than the amounts paid by the plaintiff or his or her insurer for the medical services received. To be recoverable, a medical expense must be actually incurred, not simply billed. If, as here, the plaintiff negotiates a discount and thereby receives services for less than might reasonably be charged, the plaintiff has not suffered a pecuniary loss or other detriment in the greater, billed amount and therefore should not and cannot recover damages for that amount.
Click here to read the brief.
Corenbaum v. Lampkin - Second Appellate District - 12/31/12: In this case, plaintiffs were seriously injured while riding in a taxi. The defendant, intoxicated and driving at excessive speeds, ran a red light and collided with the taxicab. At trial, the court did not permit the admission of any evidence relating to the collateral source payment of plaintiffs' medical bills. The California Supreme Court's ruling in Howell v. Hamilton Meats & Provisions, for the first time, permits the introduction of the amount accepted by a medical provider as payment in full, but generally precludes evidence of any collateral source of such payment. The court is now seeking assistance on the following two issues left open by the Howell decision:
1. Although evidence of the amount billed for medical expense is irrelevant, and thus inadmissible under Howell on the issue of past medical damages, to what extent, if at all, is such evidence relevant and admissible on (a) medical expenses and/or (b) noneconomic damages?
2. To the extent that evidence of medical billings is admissible on either of the two issues identified above, and such evidence is in fact presented to the jury, what specific limiting instruction, if any, should be given?
CJAC's answer to the above questions is that evidence of the amount billed for medical expenses may be relevant to assist the trier of fact in determining future medical expenses in certain situations, provided an appropriate limiting instruction is given that they are not in themselves sufficient to establish the “reasonable value” of future expenses but must be considered with and in the context of expert testimony on the issue. Evidence of amounts “billed” for medical expenses is, however, never relevant nor admissible for ascertaining noneconomic damages. (Corenbaum v. Lampkin, B236227, brief filed on 12/31/12)
Corenbaum Decision Rendered - 4/30/13: The court unanimously agreed with CJAC's arguments that evidence of the full amount billed for a plaintiff's medical care is not relevant to the determination of a plaintiff's damages for medical expenses, past or future, and therefore is inadmissible for that purpose if the plaintiff's medical providers, by prior agreement, had contracted to accept a lesser amount as full payment for the services provided.
Howell v. Hamilton Meats & Provisions, Inc. - California Supreme Court - 9/2/10: At issue is whether plaintiffs in personal injury actions are entitled to recover an amount for medical expenses greater than what their private health insurance paid on their behalf and what their healthcare providers who treated them for injuries accepted as full payment for services. The appellate opinion here concluded the amounts billed for plaintiff’s medical care, and not the amount actually paid by plaintiff’s medical insurance to fully satisfy all her financial obligations for that care, was the correct measure of medical damage because to hold otherwise violates the collateral source rule.
Should this opinion remain law, it not only will cause confusion (it conflicts with other appellate decisions), but will result in substantially greater sums being paid by health insurers to plaintiffs, which translates into an increase in the size of settlements, verdicts, the number of lawsuits, and the cost of health care and insurance. (Howell v. Hamilton Meats & Provisions, Inc., S179115, CJAC amicus brief filed on 9/2/2010)
Howell Decision Rendered - 8/18/11: The California Supreme Court agreed with CJAC and held that an injured plaintiff whose medical expenses are paid through private insurance may recover as economic damages no more than the amounts paid by the plaintiff or his or her insurer for the medical services received or still owing at the time of trial.
The 6-1 decision, authored by Justice Werdegar with pro tem Justice Klein dissenting, overturned the appellate court, which had previously ruled that plaintiff was entitled to the full “sticker price” amount billed by her medical care providers.
People v. Atlantic Richfield Co. – Sixth Appellate District – 2/23/15: CJAC submitted February 23, 2015 an amicus brief in the Sixth Appellate District in People v. Atlantic Richfield Co., et al., H040880.
CJAC addresses two of several issues this case presents: (1) Is "public nuisance" an apt legal theory for holding three manufacturers of lead paint, who stopped making and selling it long before it was outlawed in 1978, responsible for paying $1.15 billion into a state fund to cover the costs of having that paint removed from the interiors of houses where it was applied decades ago; and (2) Can these defendants be found, in logic or law, to have "caused" the "public nuisance" about which prosecutors (acting through privately retained contingency fee counsel) complain?
We argue the rational and fair answer to both questions is "No." That the trial court held otherwise is deeply troubling, not just to defendants but to the public interest and for the administration of justice. Unless reversed, defendants will be saddled with a huge financial burden for having done no more than made, advertised and sold paint containing lead pigment that was entirely legal for them to do at the time (and which they voluntarily discontinued making and distributing long before its sale was prohibited by federal law in 1978).
This case began in 2000 when the County of Santa Clara filed a class action complaint against a number of companies, or their successors-in-interest, that long ago manufactured, marketed, distributed, and/or sold paint containing lead pigment. The complaint alleged that this lead pigment contributed to health hazards when the paint deteriorated and peeled and people breathed in its dust or, in the case of children, ate paint chips. Other cities and counties soon joined the suit.
Eventually, the case went to trial and the court issued a 111-page "statement of decision." This decision ordered three of five paint manufacturers (defendants) to jointly and severally pay $1.15 billion into a new fund to be administered by, if it accepts, an existing state agency established by the Legislature years ago as part of a comprehensive regulatory scheme for dealing with the health hazards posed by lead in the environment. These monies were to be paid as "grants" to the plaintiff governments for "abating" the "public nuisance" of lead paint in the interior of residences constructed before 1980 within the combined jurisdictions represented by plaintiffs.
Click here to read the brief.
Soto v. A Best Products Co. - Second Appellate District Court of Appeal - 1/26/15: CJAC submitted an amicus brief January 26, 2015, to the Second Appellate District Court of Appeal in Soto v. A Best Products Co., B252995. This asbestos exposure case resulted in a judgment against defendant (found to be 35% at fault for plaintiffs’ injuries) for $60,000 in compensatory damages and $32.5 million in punitive damages to the estate, on top of $391,367 in economic damages and $6 million in noneconomic damages to decedent’s three daughters.
CJAC addresses two issues: 1. Does evidence about a parent company’s “financial condition” and extrapolations as to defendant subsidiary’s current revenue and earnings based on information more than a decade old suffice to show the present wealth of the defendant, a non-alter ego subsidiary, when determining the amount of punitive damages to impose; and 2. Does it violate due process to subject defendant to a large punitive damage award for making a product (vehicle clutches) 40 years ago that contained asbestos it did not know would harm plaintiff, an employee of automobile assembly plant where the product was used, from his exposure to it?
We contend the answer to the question about the adequacy of evidence required to show the wealth of the defendant is “No,” and the answer to whether due process is violated in these circumstances is “Yes,” thus warranting reversal of the punitive damage award.
Click here to read the brief.
Horiike v. Coldwell Banker Residential Brokerage Co – California Supreme Court – 3/25/15 - CJAC filed an amicus brief March 25, 2015 with the California Supreme Court in Horiike v. Coldwell Banker Residential Brokerage Co., S218734. The issue is: When the buyer and seller in a residential real estate transaction are each independently represented by a different salesperson from the same brokerage firm, does Civil Code section 2079.13, subdivision (b), make each salesperson the fiduciary to both the buyer and the seller with the duty to provide undivided loyalty, confidentiality and counseling to both?
The trial court said no, but the appellate court reversed, holding each sales agent was, besides their broker, a "dual agent" with fiduciary duties owed to both buyer and seller regardless of the parties' intentions and despite long-standing industry custom and practice to the contrary.
CJAC argues that accepting the appellate court's conclusion, and the reasoning underlying it, will substantially increase liability for real estate agents and significantly increase litigation and the price of real estate.
Click here to read the brief.
Unfair Competition Law
Wells Fargo Bank v. Gutierrez – US Supreme Court – 5/11/2015 - CJAC submitted an amici brief the week of May 11, 2015 to the US Supreme Court urging "cert" of Wells Fargo Bank v. Gutierrez, Case No. 14-1230. CJAC joined with several organizations, including the US Chamber, California Chamber and the Bankers Association, asking the Court to review this Ninth Circuit case that raises important and recurring issues about limitations on federal class actions asserting claims under California's Unfair Competition Law (UCL).
The brief argues the Court should grant certiorari because the sharp differences between the standing requirements of Article III and the UCL exacerbate the conflict over whether Article III precludes class certification if absent class members lack standing.
To read the brief, click here.
People ex rel. Kamala Harris v. Pac Anchor Transportation - California Supreme Court - 4/25/12: The issue in this case is whether an action under the UCL against a trucking company for treating individuals who drive trucks for them as "individual contractors" instead of "employees" is preempted by the Federal Aviation Administration Authorization Act (FAAAA). CJAC contends that a trilogy of US Supreme Court cases provide ample authority and reason for concluding that this UCL action is preempted by the FAAAA. (People ex rel. Kamala Harris v. Pac Anchor Transportation, S194388, brief filed on 4/25/12)
People v. Pac Anchor Transportation Decision Rendered – 07/28/14: The California Supreme Court on July 28, 2014, released its opinion in People ex rel. Kamala Harris v. Pac Anchor Transportation, S194388.
The issue is whether an action under the UCL against a trucking company for treating individuals who drive trucks for them as "individual contractors" instead of "employees" is preempted by the Federal Aviation Administration Authorization Act (FAAAA).
CJAC contended that a trilogy of US Supreme Court cases provide ample authority and reason for concluding that this UCL action is preempted by the FAAAA.
However, in today's unanimous opinion authored by Justice Chin, the Court concluded that the FAAAA does not preempt the People’s UCL action against defendants and affirmed the Court of Appeal’s judgment.
The omnivorous reach of the UCL continues. . .
To read the opinion, click here.