- Admitting Evidence Not Listed at MSC Is Not "Harmless Error"on May 20, 2025 at 4:11 PM
Alonzo McClanahan claimed workers’ compensation benefits for an alleged industrial injury to his right shoulder that occurred on July 25, 2017, while working at Employer DPR Construction (DPR). At the time its workers’ compensation carrier was National Union Fire Insurance Company. DPR's claims administrator denied the claim a few months later.
The following year, McClanahan sought board adjudication of his claim. (§ 5500; Cal. Code Regs., tit. 8, § 10455.) Dr. Hanley was originally designated as the qualified medical evaluator and prepared two reports in that capacity in 2018 (the Hanley reports). He was later replaced as the qualified medical evaluator by Dr. Foglar and then by Dr. McGahan.
After engaging in discovery, the parties participated in a mandatory settlement conference (§ 5502, subd. (d)), which was unsuccessful, so the matter was set for trial. The pretrial conference statement stipulated to Dr. McGahan as the qualified medical evaluator (§ 4062.2) and provided a list of exhibits, including reports by Dr. McGahan, but the Hanley reports were not included.
At trial, McClanahan testified that his right shoulder was injured on the morning of July 25, 2017, while working for DPR (the 2017 injury). Specifically, he was “moving like 200 2-by-4s, 20-foot long, from one place to another” for four or five hours when the area between his shoulder and neck started to get stiff. He told his foreman that he couldn’t lift anymore with his shoulder hurting, and when he got off a few hours later, he told his superintendent that his “shoulder up in [his] neck” was sore. The superintendent asked him if he wanted to make a report, but McClanahan declined because he didn’t think it was that bad.
But when McClanahan woke up the next day, his arm and shoulder were stiff. He went to a doctor that night who advised taking a few days off work because his shoulder may be overworked. McClanahan reported this to DPR, but he did not see a workers’ compensation doctor until August 10, 2017. In his view, DPR caused the delay.
Three DPR employees disagreed with McClanahan’s account. Both the foreman and the superintendent stated that McClanahan did not report an injury to them on July 25, 2017. And the DPR safety manager who prepared the incident report testified that to his knowledge, McClanahan did not report an injury to anyone on July 25, 2017. DPR’s evidence included the employee sign out sheet for July 25, 2017, that indicated McClanahan signed out at 3:00 p.m. and checked the box indicating he was not injured.1 The safety manager also testified he made several attempts to take McClanahan to the workers’ compensation clinic between July 27, 2017, and August 7, 2017, in accordance with DPR policy, but McClanahan never showed up.
In a deposition, McClanahan testified DPR was the first place he ever had right shoulder pain, but at trial he admitted he suffered an industrial injury below his right elbow in 2013, a few years before working for DPR (the 2013 injury), and felt pain in his right shoulder as a result. He also testified he never went to a doctor for right shoulder pain before July 2017, but medical records showed that he sought or obtained care for shoulder pain or strain several times between 2013 and 2015, had an MRI of his right shoulder in 2014, and was diagnosed with a right shoulder condition in 2015. The records also indicated that he sought treatment for impingement in the right shoulder after a tree branch fell on it in 2015, but McClanahan could not remember a tree ever falling on his shoulder.
According to Dr. McGahan’s evaluation, McClanahan sustained “an industrial injury to his right shoulder arising out of and caused by the industrial exposure of July 25, 2017.” Dr. McGahan found it clear that McClanahan had preexisting right shoulder pathology but concluded it was “medically probable that [McClanahan’s] work duties on July 25, 2017, contributed to a worsening of his right shoulder pain.” In a supplemental report, Dr. McGahan stated that if “McClanahan is not a credible witness, then this certainly would call into question the credibility of his claim. Under this circumstance, the incident of July 25, 2017, may simply represent an exacerbation of his prior industrial injury rather than aggravation.
Over DPR’s objection, the workers’ compensation judge (WCJ) admitted the Hanley reports because DPR had received them before the mandatory settlement conference. In the first report, Dr. Hanley noted that some of McClanahan’s providers were suspicious about the validity of his complaints. In a supplemental report, Dr. Hanley concluded the “red flags” in McClanahan’s history were no longer of concern.
Based on McClanahan’s “credible testimony, the treatment records, and the findings by QME Dr. McGahan,” the WCJ concluded that McClanahan sustained an injury to his right shoulder arising out of and in the course of employment on July 25, 2017.
After reconsideration, the WCAB affirmed the WCJ’s determination on August 22, 2024 in a two-to-one decision. The affirming board members found that McClanahan erred by omitting the Hanley reports from the pretrial conference statement but concluded the error was harmless for two reasons: (1) the WCJ did not rely on the Hanley reports to find the industrial injury; and (2) the WCJ retains the discretion to determine if evidence should be admitted into the record as a matter of due process.
The Court of Appeal agreed to hear the case, and after it's review annulled the board’s decision and remanded for further proceedings in the unpublished case of DPR Construction v. Workers' Compensation Appeals Board CA3 - C100254- (May 2025).
On appeal, Petitioners contend the board exceeded its powers in two ways: (1) by failing to state the reasons for finding McClanahan credible and (2) by admitting two medical reports that were not listed in the pretrial conference statement. The Court of Appeal disagreed with petitioners as to the first contention but agreed as to the second.
In workers’ compensation proceedings, discovery closes on the date of the mandatory settlement conference. ( at p. 1164; § 5502, subd. (d)(3).) If the claim is not resolved at the conference, the parties must file a pretrial conference statement noting the specific issues in dispute, listing the exhibits, and disclosing witnesses. (§ 5502, subd. (d)(3); Cal. Code Regs., tit. 8, § 10759, subd. (b).) Evidence not disclosed or obtained thereafter is not admissible unless the proponent can demonstrate it was not available or could not have been discovered by the exercise of due diligence before the settlement conference. (§ 5502, subd. (d)(3).)
The purpose of this requirement is two-fold: (1) to “eliminate the element of surprise in workers’ compensation proceedings” and (2) “ ‘ “ ‘to guarantee a productive dialogue leading, if not to expeditious resolution of the whole dispute, to thorough and accurate framing of the stipulations and issues for hearing.’ ” ’ ” (Telles Transport, Inc. v. Workers’ Comp. Appeals Bd. (2001) 92 Cal.App.4th 1159, at pp. 1164, 1167.) The board abuses its discretion when it relieves a party from the sanctions of section 5502 without that party showing good cause. (San Bernardino Community Hospital v. Workers’ Comp. Appeals Bd. (1999) 74 Cal.App.4th 928, 938.
Section 5502 establishes the “bounds of discretion in the [WCJ] for keeping discovery open after the mandatory settlement conference.” (County of Sacramento v. Workers’ Comp. Appeals Bd. (1999) 68 Cal.App.4th 1429, 1433.) “[D]isregard for the statutory procedural mechanisms for resolving workers’ compensation cases is inappropriate.” (Ibid.) Such disregard is not subject to harmless error analysis. (San Bernardino, supra, 74 Cal.App.4th at p. 938.)
- Tulare Doctor Pleads Guilty to Distributing Misbranded COVID Drugson May 20, 2025 at 4:11 PM
Stephen D. Meis, M.D., 73, formerly of Visalia, pleaded guilty to one count of introduction of misbranded drugs into interstate commerce.
According to court documents, Meis was the Medical Director of Golden Sunrise Pharmaceutical Inc. and Golden Sunrise Nutraceutical Inc. that manufactured, marketed, and sold products claiming to effectively treat a variety of medical conditions.
Beginning on March 30, 2020, Meis and Golden Sunrise’s Chief Executive Officer Huu Tieu, 62, of Porterville, began selling a set of herbal mixtures they called the “Emergency D-Virus Plan of Care” as a COVID-19 treatment. The treatment consisted of a box containing various vials of Golden Sunrise drug products, including one called “Imunstem,” together with an “Emergency D-Virus Plan of Care” information sheet. Meis and Tieu mailed the products to various practitioners, public officials, and other individuals both inside and outside of California.
The labeling for the drugs, including the information sheet that accompanied the drugs, was false and misleading and stated that ImunStem and other Golden Sunrise products were “uniquely qualified to treat and modify the course of the virus epidemic in China and other countries.”
Golden Sunrise falsely claimed the products had been the first dietary supplement in the United States to be approved as a prescription medicine by the U.S. Food and Drug Administration (FDA) to treat the COVID-19 virus. In fact, the drugs were not FDA approved, and no Golden Sunrise product had ever been approved by the FDA for any purpose.
On June 12, 2024, Tieu was sentenced to 18 months in prison for introduction of misbranded drugs into interstate commerce.
Meis is scheduled to be sentenced by U.S. District Judge Jennifer L. Thurston on July 14, 2025. Meis faces a maximum statutory penalty of 12 months in prison and a $100,000 fine. The actual sentence, however, will be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables.
This case is the product of an investigation by the FDA Office of Criminal Investigations, the U.S. Department of Health and Human Services Office of Inspector General, and the Federal Bureau of Investigation with assistance from the Tulare County District Attorney’s Office. Assistant U.S. Attorneys Jeffrey A. Spivak and Emilia P.E. Morris are prosecuting the case.
- PAGA Action Prevailing Employer May Not Recover Costs From LWDAon May 19, 2025 at 11:32 AM
In March 2017, Kelly Rose, a former employee of Hobby Lobby Stores, Inc., notified the California Labor and Workforce Development Agency (LWDA) and Hobby Lobby that she intended to seek civil penalties under PAGA on behalf of herself, the State of California, and other hourly-paid individuals who were employed by Hobby Lobby in California as cashiers or who were assigned cashier duties. Rose’s claims were based on allegations that Hobby Lobby violated the so-called “suitable seating” provisions of Industrial Welfare Commission Wage Order No. 7-2001 by not providing seats for cashiers. (Cal. Code Regs., tit. 8, § 11070, subds. 1, 14.)
After the statutory deadline for the LWDA to respond to the notice had passed, Rose filed a civil action against Hobby Lobby alleging two causes of action based on the facts and theories alleged in her PAGA notice. The litigation proceeded for several years, and eventually a bench trial was held that resulted in a judgment for Hobby Lobby on both causes of action.
In a separate appeal, the Court of Appeal affirmed the judgment. (Rose v. Hobby Lobby Stores, Inc. (March 25, 2025, A168301) [nonpub. opn.].) After judgment was entered, Hobby Lobby filed a memorandum of costs totaling $474,707.80.
The trial court issued an order inviting the LWDA, which had not participated in the litigation, to file an amicus brief addressing its liability for an award of costs to a prevailing defendant in a PAGA action. At the trial court’s direction, Hobby Lobby served the order on the LWDA, at which point the LWDA first learned of Hobby Lobby’s attempt to recover its costs. The LWDA then filed a motion to intervene, which the trial court granted.
The trial court concluded that the LWDA is responsible for costs incurred by defendants who prevail on PAGA claims, but struck certain cost items that Rose had challenged, resulting in an award of costs against the LWDA in the amount of $124,585.24. The LWDA timely appealed from the costs order. The trial court did not award Hobby Lobby any costs against Rose, and Rose is not a party to this appeal.
The LWDA appealed, raising an issue of first impression: Is the LWDA liable for the litigation costs incurred by a prevailing defendant in an action filed under PAGA?
The Court of Appeal concluded that costs are not recoverable against the LWDA where it did not participate in the litigation. Accordingly, it reversed the trial court costs order in the published case of Rose v. Hobby Lobby Stores CA1/2 - A169640 (May 2025).
In seeking costs from the LWDA, Hobby Lobby relied on Code of Civil Procedure §1032(b), the general cost-recovery statute, which provides that a prevailing party is entitled to recover its costs “[e]xcept as otherwise expressly provided by statute,” and Code of Civil Procedure section 1028, which provides that when the State is a party to an action costs are “awarded against it on the same basis as against any other party.”
PAGA provides that “[a]ny employee who prevails in any action shall be entitled to an award of reasonable attorney’s fees and costs” (Lab. Code, § 2699, subd. (k)(1)), but says nothing about prevailing employers. Hobby Lobby argues that in view of the guidance provided by our Supreme Court in Murillo v. Fleetwood Enterprises, Inc. (1998) 17 Cal.4th 985, 989 for interpreting so-called “one-way” fee and cost shifting statutes like the one in PAGA, the Court of Appeal should conclude that PAGA does not contain an express exception to section 1032(b) and therefore as a prevailing defendant Hobby Lobby is entitled to recover its costs.
In Murillo, the Supreme Court construed a fee and cost shifting provision in the Song-Beverly Act (Civ. Code, § 1790 et seq), California’s automobile “lemon law,” which expressly permits a prevailing plaintiff-buyer to recover costs and attorney fees but is silent with respect to a prevailing defendant-seller. Murillo held that silence does not create an express exception to section 1032(b); therefore, a prevailing defendant-seller in a case brought under the Song-Beverly Act is entitled to recover its costs under section 1032(b). (Id. at p. 991.)
The LWDA argues that legislative history shows that Labor Code section 2699, subdivision (k)(1) was intended to displace the general cost recovery rule of section 1032(b), and that Murillo, which concerns a consumer protection statute rather than a provision of the Labor Code, is inapposite.
Hobby Lobby argued unpersuasively that the LWDA was nevertheless a party to Rose’s action from its commencement because Rose filed her PAGA suit as the LWDA’s agent, and that under Civil Code section 2330 the LWDA, as principal, is responsible for the acts and liabilities of its agent.
"The LWDA did not sue Hobby Lobby. The LWDA was not a party to Rose’s lawsuit, nor did it take any action in the lawsuit until it moved to intervene, which it did only after it got word that Hobby Lobby sought to impose its costs on the LWDA. Accordingly, Hobby Lobby cannot recover its costs from the LWDA."
"Because we conclude that the LWDA was not a party to Rose’s PAGA action, Code of Civil Procedure section 1028, which provides that when the State is a party costs are to be awarded against it on the same basis as against any other party, has no application here."
"Hobby Lobby also argues that even if the LWDA was not a party to Rose’s PAGA action, it is liable for costs as the real party in interest. This argument is unpersuasive because Hobby Lobby cites no case in which litigation costs were imposed against a real party in interest that did not participate in the litigation."
- Ninth Circuit Upholds AB 5 Against Independent Truckers' Challengeon May 19, 2025 at 11:32 AM
The California Trucking Association (CTA) filed a lawsuit in November 2019 in the U.S. District Court for the Southern District of California challenged the application of California’s Assembly Bill 5 (AB 5) to the trucking industry, specifically arguing that it violates the Dormant Commerce Clause of the U.S. Constitution, among other claims.
AB 5, enacted in 2019 and effective January 1, 2020, codified the "ABC test" to determine whether workers are classified as employees or independent contractors. The "B" prong of the test, which requires that a worker perform work outside the usual course of the hiring entity’s business to be considered an independent contractor, effectively prohibits the traditional leased owner-operator model in trucking, as owner-operators’ work (hauling freight) is central to a motor carrier’s business.
Plaintiffs argued that AB 5 was preempted by the Federal Aviation Administration Authorization Act of 1994 (FAAAA), which prohibits states from enacting laws affecting a motor carrier’s prices, routes, or services. The Dormant Commerce Clause and Equal Protection Clause were also cited as grounds for challenge.
On December 31, 2019, District Judge Roger Benitez granted a preliminary injunction, halting AB 5’s enforcement against the trucking industry, finding that the law likely violated FAAAA preemption by restricting motor carriers’ ability to use independent contractors, a core component of interstate trucking. The Ninth Circuit Court of Appeals reversed this injunction in its April 2021 published opinion, ruling that AB 5 was a generally applicable labor law that did not sufficiently impact prices, routes, or services to be preempted by the FAAAA. The injunction remained in place pending further appeals. The U.S. Supreme Court declined to review the case in June 2022, returning it to the Southern District of California and dissolving the injunction.
The Owner-Operator Independent Drivers Association (“OOIDA”) is the international trade association representing the interests of independent owner-operators and professional drivers on all issues that affect truckers. More than 150,000 members of OOIDA are men and women in all 50 states and Canada who collectively own and/or operate more than 240,000 individual heavy-duty trucks and small truck fleets. Its national headquarters is located on the outskirts of Kansas City, in Grain Valley, MO.
OOIDA joined the litigation in 2022 as an intervenor, focusing on the interests of small-business truckers, particularly those operating interstate. After the Supreme Court’s denial, CTA and OOIDA filed renewed motions for a preliminary injunction, combining arguments on FAAAA preemption, the Dormant Commerce Clause, and Equal Protection. They contended that AB 5’s ABC test, by effectively banning leased owner-operators, imposed an undue burden on interstate commerce, violating the Dormant Commerce Clause. This clause, inferred from Article I, Section 8 of the U.S. Constitution, prohibits states from enacting laws that discriminate against or excessively burden interstate commerce.
On March 15, 2024, Judge Benitez rejected the renewed motions for a preliminary injunction, ruling against CTA and OOIDA on all claims. He concluded that AB 5 did not violate the Dormant Commerce Clause, as it lacked discriminatory intent or effect favoring California truckers over out-of-state truckers. Without such discrimination, the court declined to engage in Pike balancing, noting that only a “small number of cases” have found nondiscriminatory burdens substantial enough to violate the clause.
In August 2024, the CTA announced it would not pursue further appeals, ending its four-and-a-half-year legal battle. OOIDA continued the fight, filing an appeal with the Ninth Circuit in August 2024. Their brief focused on the Dormant Commerce Clause, arguing that AB 5’s ABC test “effectively prohibits an entire sector of small business truckers” from operating as independent contractors in California, creating a significant burden on interstate commerce. They also reiterated the Equal Protection claim, citing the B2B exemption’s incompatibility with federal regulations.
California’s Attorney General responded in November 2024, asserting that AB 5 does not prohibit owner-operators outright and that its regulatory costs do not trigger Pike balancing. The state argued that the law’s intent was to protect workers, not to discriminate against interstate commerce.
On May 16, 2025 the Court of Appeals for the 9th Circuit issued an unpublished Memorandum Opinion in the case of Owner-Operator Independent Drivers Association, Inc. v. Bonta - Case # 3:18-cv-02458-BEN-DEB. It concluded - among other findings - that "AB 5 does not violate the dormant Commerce Clause. “The dormant Commerce Clause is not a roving license for federal courts to decide what activities are appropriate for state and local government to undertake, and what activities must be the province of private market competition.” United Haulers Ass’n, Inc. v. Oneida-Herkimer Solid Waste Mgmt. Auth., 550 U.S. 330, 343 (2007). "
- Fresno Health System to Pay $31.5 M to Resolve Kickback Caseon May 15, 2025 at 10:26 AM
Community Health System and its affiliate Physician Network Advantage Inc. have agreed to pay $31.5 million to the United States to resolve allegations that they violated the False Claims Act based on financial benefits provided to referring physicians. Community Health System operates in Fresno County and includes hospitals Community Regional Medical Center and Clovis Community Medical Center.
The civil settlement resolves allegations that Community Health System and Physician Network Advantage Inc. (PNA) provided several types of extravagant benefits to induce physicians in the Fresno area to refer their patients to Community facilities for medical services, in violation of the False Claims Act. PNA is a health care technology business formed and funded by Community to support Fresno-area physicians’ adoption of the electronic health records platform used by Community. The United States contends that PNA also played a key role in securing business for Community by unlawful means. In a custom-built lounge located on premises at PNA’s offices, known as HQ2, PNA provided expensive wine, liquor, cigars, and meals to referring physicians, with the knowledge and funding of Community.
The settlement also resolves allegations that Community and PNA provided financial subsidies for electronic health records technology and equipment used by certain physicians in their private offices in return for the referral of governmental health care program patients to Community. Further, the settlement resolves allegations that Community paid bonuses to certain physicians ostensibly for participation in clinical integration activities, when the real purpose of the bonuses was to reward referrals.
The United States contends that these financial benefits violated the federal Anti-Kickback Statute, resulting in false claims for the medical services referred by physicians receiving the benefits, that were submitted to governmental health care programs. The United States also contends that the conduct described above created financial relationships with referring physicians under the Physician Self-Referral Law (known as the “Stark Law”). The Stark Law seeks to safeguard the integrity of the Medicare program by prohibiting a hospital from billing for certain services referred by physicians with whom the hospital has a financial relationship, unless that relationship satisfies one of the law’s statutory or regulatory exceptions, which the United States contends were not met.
In connection with the settlement, Community entered into a five-year Corporate Integrity Agreement with HHS-OIG that requires, among other conditions, the implementation of a risk assessment and internal review process designed to identify and address evolving compliance risks. The Corporate Integrity Agreement also requires an independent review organization to annually assess the policies and systems to track arrangements with some referral sources.
The settlement includes the resolution of claims brought under the qui tam or whistleblower provisions of the False Claims Act by relator Michael Terpening. Under those provisions, a private party can file an action on behalf of the United States and receive a portion of any recovery from that action. The qui tam case is captioned United States ex rel. Terpening v. Fresno Community Hospital and Medical Center, et al., 1:19-CV-01699 (E.D. Cal.). As part of the settlement announced today, Mr. Terpening will receive approximately $5 million.
The resolution obtained in this matter was the result of a coordinated effort between the U.S. Attorney’s Office for the Eastern District of California and HHS-OIG with assistance from the Federal Bureau of Investigation and the U.S. Postal Service Office of Inspector General. Assistant U.S. Attorney David Thiess handled the case for the U.S. Attorney’s Office.
The claims resolved by this settlement are allegations only, and there has been no determination of liability.
- Ventura County Unlicensed Physician Re-Arrested for Practicingon May 15, 2025 at 10:26 AM
The Ventura County District Attorney Erik Nasarenko announced that Nitun “Nate” Dayalghai Ahir (DOB 06/17/81), of Thousand Oaks, was arraigned for practicing medicine without a license, in violation of Business and Professions Code section 2052.
Ahir was out on bail in case number 2024030574, in which he is alleged to have practiced medicine without a license and represented himself as a doctor at Regen Spine & Nerve, in Ventura, when the District Attorney’s Office received complaints that Ahir was continuing to practice medicine without a license.
In his new case, Ahir is alleged to have unlawfully provided medical services to victims only days after being arraigned in case 2024030574. He is further charged with using the term “Doctor” and the prefix “Dr.” to imply he is a licensed medical professional when he is not. Judge David Hirsch explicitly made a condition of Ahir’s bail that he may not practice medicine, solicit medical business, attempt to treat patients, or receive compensation for any form of medical work, or he faces remand into custody.
According to the California Department of Consumer Affairs, Ahir is not licensed in any capacity – as a doctor, surgeon, nurse, nurse practitioner, chiropractor, or otherwise – in the State of California, nor is he a licensed physician in any other state.
The District Attorney requests that any member of the public who Ahir has attempted to treat contact Investigator Eric Jensen at Eric.Jensen@ventura.org or by calling 805-662-1739. The public is urged to review the licensure status of any medical professionals they are considering seeing by visiting the Department of Consumer Affairs' professional
This case was investigated by the Department of Consumer Affairs, Health Quality Investigations Unit. Both of Ahir’s cases are set for early disposition conference on June 25, 2025, at 1:30 p.m. in Courtroom 12 of the Ventura County Superior Court. He remains out of custody on $50,000 bail.
- Jury Trial Rights Attach to Claim for Unruh Civil Rights Act Damageson May 14, 2025 at 1:43 PM
Plaintiff Theresa Brooke is a woman with disabilities who uses a wheelchair. Along with her husband, she frequents California hotels to test their compliance with disability access laws. On one such testing trip in August 2023, Brooke and her husband visited the Ramada by Wyndham Burbank Airport, a hotel in Burbank, California. When they arrived, however, architectural barriers allegedly deterred Brooke from entering.
Brooke sued the hotel’s owner, Defendant Tsay JBR, LLC, asserting violations of Title III of the Americans with Disabilities Act (ADA), 42 U.S.C. § 12181 et seq., and California’s Unruh Civil Rights Act, Cal. Civ. Code § 51 et seq. (West 2025).
The California The Unruh Act similarly creates a private right of action for people with disabilities, along with other enumerated groups, who are denied “full and equal” access to California businesses. See Cal. Civ. Code § 51(b). As part of those protections, the Unruh Act provides that any violation of the ADA is also a violation of its provisions. See id. § 51(f).
Although private parties can obtain only injunctive relief under the ADA, they can recover actual and statutory damages under the Unruh Act. Id. § 52(a); see Arroyo v. Rosas, 19 F.4th 1202, 1206 (9th Cir. 2021) (explaining that the Unruh Act effectively creates a state-law “damages remedy that is not available under the ADA”).
Accordingly, Brooke sought injunctive relief under the ADA, statutory damages under the Unruh Act, and declaratory relief and attorney’s fees under both.
The district court granted in part and denied in part a motion for summary judgment brought by Brooke. The court concluded that Tsay JBR had violated the ADA because the hotel’s passenger loading zone - an area for vehicle pickup and drop-off - lacked an access aisle for disabled guests. As a remedy, the court ordered Tsay JBR to paint a blue access aisle in front of the loading zone.
Because Brooke established an ADA violation, she also necessarily established an Unruh Act violation. But not all Unruh Act violations automatically entitle a plaintiff to statutory damages. When a violation is construction-related, the Unruh Act only permits statutory damages if the plaintiff personally encountered the violation or was deterred by it. Id. § 55.56(a)–(b). The district court determined that Brooke had not established that fact on summary judgment.
With only that factual issue left, the court converted the scheduled jury trial to a bench trial, concluding that the jury- trial right did not attach to claims for statutory damages under section 52(a) of the Unruh Act.
Tsay JBR petitioned the Court of Appeals for the 9th Circuit for a writ of mandamus, asking it to direct the district court to conduct a jury trial on the issue of Brooke’s entitlement to statutory damages. The panel held that the Seventh Amendment entitles parties in federal court to a jury trial on a claim for statutory damages under § 52(a) of the Unruh Act in the published case of Tsay JBR LLC v United States District Court for the Central District of California - 24-5234 (May 2025).
The Seventh Amendment to the United States Constitution provides that in “[s]uits at common law, where the value in controversy shall exceed twenty dollars, the right of trial by jury shall be preserved.” In this case the Court of Appeals considered whether a defendant in an action for statutory damages under section 52(a) of California’s Unruh Civil Rights Act is entitled to a jury trial.
"So long as a case involves a legal claim, the right to a jury trial attaches, even if the case also seeks equitable relief. See Curtis v. Loether, 415 U.S. 189, 196 n.11 (1974) (“The [jury-trial] right cannot be abridged by characterizing the legal claim as ‘incidental’ to the equitable relief sought.”); Dairy Queen, Inc. v. Wood, 369 U.S. 469, 473 n.8 (1962)."
"The statutory damages in section 52(a) of the Unruh Act are thus a legal remedy. Because both the historical analog and the nature of the remedy reveal that Brooke’s claim is legal, the Court of Appeals held that the Seventh Amendment entitles parties in federal court to a jury trial on a claim for statutory damages under section 52(a) of the Unruh Act."
- NCCI Report: Workers’ Comp System Remains Strongon May 14, 2025 at 1:43 PM
The performance of the workers compensation system remains strong according to the 2024 metrics that the National Council on Compensation Insurance (NCCI) just released.
Workers compensation premium decreased 3% in 2024. Private carriers produced their 11th consecutive year of underwriting profitability with a Calendar Year 2024 combined ratio of 86. It is the 8th consecutive year with a combined ratio below 90 for the workers compensation insurance market.
"Workers compensation is a product where compassion and analytics work hand-in- hand - protecting and caring for employees while also leveraging data to make the entire system more effective and sustainable," said NCCI President and CEO Tracy Ryan.
NCCI’s State of the Line Report and the State of the Line Guide include key insights:
- - Workers compensation net written premium decreased 3% in 2024. There are two contributing factors: payroll and rate on payroll, mostly represented by the loss cost. Payroll growth is slowing, reverting back to the long-term average. Loss costs continue to decline, but more moderately.
- - The Calendar Year 2024 combined ratio for workers compensation is 86%, a sign of underwriting strength for the system. Workers compensation (WC) has one of the lowest combined ratios among property/casualty. In fact, 2024 was the 8th consecutive year with a combined ratio under 90% and the 11th consecutive year of underwriting gains.
- - Workers compensation’s Accident Year 2024 combined ratio is 99% with prior years continuing to experience downward reserve development.
- - NCCI estimates a redundant industry reserve position of $16 billion. That’s a decrease from the $18B estimated redundancy in 2023. While still a strong financial position, this is the first year with a slight reduction in the estimated redundancy.
- - Lost-time claim frequency declined by 5% in 2024. The latest year’s frequency decline outpaces the long-term average, although not to the extent of the prior year. More than half of this decrease is due to the reduction in number of claims.
- - Severity grew in 2024 with increases of 6% for medical claim severity and 6% for indemnity claim severity. Indemnity severity grew faster than wages, and medical severity grew faster than the Workers Compensation Weighted Medical Price Index (WCWMI). For medical, price is only one part of the story. The other part is utilization, and this year utilization contributes to a majority of the increase.
"The workers compensation system continues an era of exceptional performance with strong results and a financially healthy line," said Donna Glenn, FCAS, MAAA, Chief Actuary, NCCI. "And while there are early indications of potential headwinds on the horizon, the industry is positioned well to navigate these challenges."
- Six Month Delay in Requesting Arbitration Constitutes "Waiver"on May 13, 2025 at 4:10 PM
Stephen Hofer is a licensed attorney who founded Aerlex Law Group (the Group), which specializes in aviation law. In 2008, Hofer was the sole partner of the Group and hired Vicky Boladian as a part-time contract attorney. Hofer and Boladian dispute whether their professional relationship became a romantic relationship between 2011 and 2017.
In 2013, Hofer and Boladian formed Aerlex Tax Services, LLC (the tax LLC), which would provide “tax-related services” to the Group’s clients and “others within the aviation industry.” Hofer had a 55 percent equity interest in the tax LLC; Boladian, a 45 percent interest. In 2017 and 2018, Hofer and Boladian had a falling out, which resulted in litigation. In September 2020, they agreed to settle the pending litigation by executing three agreements: 1) Settlement Agreement, 2) Amended and Restated Operating Agreement for the tax LLC and 3) Amended and Restated Buy-Sell Agreement of the tax LLC. These agreements contained provisions to arbitrate disputes.
In March 2023, Boladian asked Hofer to change the business form of the tax LLC to an LLP to avoid the potential of having a limited liability company engaged in the unauthorized practice of law. In August 2023, Hofer and Boladian dissolved the tax LLC and shifted its assets to Aerlex Tax Services, LLP (the tax LLP)—with the same 55/45 percent split of ownership. Two weeks later, Boladian formed the Boladian Aviation Law Group, APC (BALG). She then withdrew from the tax LLP, removing what she represented to be 45 percent of the physical office furniture and nearly all of the tax LLP’s clients.
On September 19, 2023, Hofer sent Boladian a letter exploring a possible settlement before “commencing formal litigation” and asserting his “free[dom] to seek a judicial resolution” of their disputes. The parties discussed mediation, but could not agree on a mediator.
On October 16, 2023, Hofer, the Group, the tax LLC and the tax LLP (collectively, the Hofer plaintiffs) filed a lawsuit against Boladian and BALG. The Hofer plaintiffs alleged 13 causes of action and sought compensatory damages, injunctive and equitable relief, treble damages, punitive damages, and attorney fees. Although Hofer had, prior to filing the complaint, “agree[d] to file in arbitration” if Boladian consented to BALG participating in arbitration, the Hofer plaintiffs in the complaint nowhere mentioned arbitration under any of the three agreements and did not pray for an order compelling arbitration.
On October 31, 2023, the Hofer plaintiffs applied ex parte for a temporary restraining order (TRO) seeking to prevent Boladian and BALG from performing any work for the clients of the tax LLP or the Group, from using any of the tax LLP’s employees, and from removing or using any tangible property or data taken from the tax LLP. Nowhere in the application did they mention arbitration under any of the agreements. The trial court denied the application
On November 16, 2023, the Hofer plaintiffs moved for a preliminary injunction, trying to remedy the defects with their earlier TRO application. Once again, the Hofer plaintiffs argued their lawsuit had merit and nowhere mentioned arbitration.
In the midst of these motions, the Hofer plaintiffs inquired whether Boladian and BALG would “be seeking to move this case into arbitration”; counsel responded that they had “no plans” to do so and this communication shed no light on the Hofer plaintiffs’ intent to do so.
On December 8, 2024 (while the Hofer plaintiffs’ motion for a preliminary injunction was still pending), Boladian and BALG demurred to nine of the 13 causes of action. On January 29, 2024, the Hofer plaintiffs propounded a total of 734 discovery requests to Boladian and BALG. The Hofer plaintiffs also subpoenaed a number of third- party witnesses for depositions in February 2024. They also noticed the deposition of Boladian for March 2024.
In anticipation of the case management conference, the Hofer plaintiffs on March 14, 2024, filed a case management statement. In some respects, the Hofer plaintiffs’ case management statement acknowledged the possibility arbitrating the dispute. The Hofer plaintiffs also posted their jury fees.
On April 23, 2024, Boladian filed a cross-complaint against Hofer and the Group, alleging five causes of action. On April 26, 2024—more than six months after filing their complaint and more than four months after the denial of the preliminary injunction, but just three days after the filing of the cross-complaint - the Hofer plaintiffs filed a motion to compel arbitration, invoking the arbitration clauses in the settlement agreement, amended operating agreement, and amended buy-sell agreement.
The trial court denied the motion to arbitrate ruling that the Hofer plaintiffs had waived their right to compel arbitration. Applying the waiver standard articulated in St. Agnes Medical Center v. PacifiCare of California (2003) 31 Cal.4th 1187, the court found “that [the Hofer plaintiffs] waived the right to arbitrate by filing suit in this court and substantially and vigorously litigating it for over seven months,” concluding that this conduct was “fundamentally incompatible with the expediency, efficiency, and cost- effectiveness associated with utilizing arbitration” and that this conduct “prejudiced” Boladian and BALG.
The Court of Appeal affirmed the trial court's order in the published case of Hofer v. Boladian CA2/5 - B339542 (May 2025).
Under the California Arbitration Act (Code Civ. Proc., § 1280 et seq.) (the Act), a party with a contractual “right to compel arbitration” of a dispute may “waive[]” that right. (§ 1281.2, subd. (a).) In Quach v. California Commerce Club, Inc. (2024) 16 Cal.5th 562 (Quach), - decided a month after the trial court’s ruling - the Supreme Court overruled the arbitration-specific definition of waiver embraced in St. Agnes Medical Center v. PacifiCare of California (2003) 31 Cal.4th 1187 (St. Agnes) in favor of the “generally applicable” definition of waiver. (Quach, at p. 578.)
St. Agnes’s arbitration-specific definition of waiver called upon trial courts to evaluate six different factors - namely, “‘“(1) whether the party’s actions are inconsistent with the right to arbitrate; (2) whether ‘the litigation machinery has been substantially invoked’ and the parties ‘were well into preparation of a lawsuit’ before the party notified the opposing party of an intent to arbitrate; (3) whether a party either requested arbitration enforcement close to the trial date or delayed for a long period before seeking a stay; (4) whether a defendant seeking arbitration filed a counterclaim without asking for a stay of the proceedings; (5) ‘whether important intervening steps [e.g., taking advantage of judicial discovery procedures not available in arbitration] had taken place’; and (6) whether the delay ‘affected, misled or prejudiced’ the opposing party.”’” (Id. at p. 1196.)
"Quach applies retroactively to this direct appeal." Quach held that a waiver occurs under the Act if, by clear and convincing evidence, it is shown that a party has “intentionally relinquished or abandoned” its known right to compel arbitration. (Id. at pp. 569, 584.)
"In this case, the litigants seeking to compel arbitration initiated this lawsuit by filing a complaint in court and, while in the judicial forum, sought two forms of preliminary injunctive relief, opposed a demurrer, propounded more than 700 discovery requests, demanded a jury trial in their case management conference statement and represented they would be litigating substantive motions, and posted jury fees. It was not until the opposing party filed a cross-complaint that the litigants filed the motion to compel arbitration - more than six months into the litigation in court."
The litigants’ conduct in this case constitute a waiver under Quach.
- AI Outperforms Radiologists' Detection of Breast Cancerson May 13, 2025 at 4:10 PM
A new study - "Mammographic Classification of Interval Breast Cancers and Artificial Intelligence Performance" - conducted at the University of California, Los Angeles (UCLA) and published in in the Journal of the National Cancer Institute, investigates interval breast cancers (IBCs) - cancers diagnosed within 12 months after a negative screening mammogram - in a U.S.-based annual screening program.
The research aimed to classify IBCs based on their mammographic visibility and evaluate the performance of an artificial intelligence (AI) tool in detecting these cancers, particularly in a setting that uses both digital mammography (DM) and digital breast tomosynthesis (DBT).
The study analyzed 184,935 screening mammograms (65% DM, 35% DBT) from 49,244 women screened between 2010 and 2019 at a U.S. tertiary care academic center participating in the Athena Breast Health Network. From this cohort, 148 IBCs were identified in 148 women (mean age 61 ± 12 years), defined as ductal carcinoma in situ (DCIS) or invasive carcinomas diagnosed within 12 months of a negative mammogram (BI-RADS 1 or 2).
Eight fellowship-trained breast radiologists, with 3–24 years of experience, retrospectively classified these IBCs into six categories adapted from European guidelines: missed-reading error (visible but missed), minimal signs-actionable (subtle signs potentially detectable), minimal signs-non-actionable (subtle signs not reasonably detectable), true interval (not present at screening), occult (not visible on mammography but detectable by other modalities), and missed-technical error (missed due to technical issues like positioning).
A deep-learning AI tool (Transpara v1.7.1, ScreenPoint Medical) assigned risk scores (1–10) to 131 of the 148 negative index mammograms (17 were excluded due to breast implants or file conversion issues). Exams scoring ≥8 were considered "flagged" for elevated risk. Radiologists assessed whether AI markings accurately localized the IBC site, comparing performance across IBC types and correlating with patient and tumor characteristics.
The AI tool flagged 76% of the 131 scored mammograms, with the highest flagging rates for missed-reading errors (90%), minimal signs-actionable (89%), and minimal signs-non-actionable (72%). These mammographically visible types also received higher mean AI scores (9.5, 8.9, and 8.3, respectively) compared to non-visible types like true interval (7.3) and occult (7.9). AI accurately localized the cancer site in 47% of flagged exams, with the highest accuracy for missed-reading errors (68%) and minimal signs-actionable (62%), but lower for occult (22%) and missed-technical errors (0%). Overall, AI flagged 56% of mammographically visible IBCs versus 20% of non-visible ones, suggesting a potential 30% reduction in IBCs if AI-supported detection were implemented.
The study highlights the potential of AI to enhance the detection of mammographically visible IBCs, particularly those missed or with subtle signs, in a U.S. annual screening program using both DM and DBT. Unlike European studies, the lower rate of true interval cancers (6%) underscores the benefit of annual screening in reducing IBCs. However, AI’s ability to flag occult and true interval cancers, despite lower localization accuracy, raises questions about its predictive value and clinical utility, as radiologists may struggle to act on flagged exams without visible abnormalities.
Limitations include the retrospective design, small sample sizes for some IBC subtypes, and the use of a single AI vendor, which may limit generalizability. The mix of DM and DBT reflects real-world practice but complicates comparisons. Selection bias from the Athena study cohort and technical issues with unscored exams are additional constraints. Importantly, the study does not confirm whether AI-flagged exams would lead to earlier detection in practice, as radiologist recall decisions remain uncertain.
The study was supported by the National Institutes of Health, the Agency for Healthcare Research and Quality, and Early Diagnostics Inc., with no reported conflicts of interest. The data are available upon request from the corresponding author, Tiffany T. Yu, MD.
- Admitting Evidence Not Listed at MSC Is Not "Harmless Error"on May 20, 2025 at 4:11 PM
Alonzo McClanahan claimed workers’ compensation benefits for an alleged industrial injury to his right shoulder that occurred on July 25, 2017, while working at Employer DPR Construction (DPR). At the time its workers’ compensation carrier was National Union Fire Insurance Company. DPR's claims administrator denied the claim a few months later.
The following year, McClanahan sought board adjudication of his claim. (§ 5500; Cal. Code Regs., tit. 8, § 10455.) Dr. Hanley was originally designated as the qualified medical evaluator and prepared two reports in that capacity in 2018 (the Hanley reports). He was later replaced as the qualified medical evaluator by Dr. Foglar and then by Dr. McGahan.
After engaging in discovery, the parties participated in a mandatory settlement conference (§ 5502, subd. (d)), which was unsuccessful, so the matter was set for trial. The pretrial conference statement stipulated to Dr. McGahan as the qualified medical evaluator (§ 4062.2) and provided a list of exhibits, including reports by Dr. McGahan, but the Hanley reports were not included.
At trial, McClanahan testified that his right shoulder was injured on the morning of July 25, 2017, while working for DPR (the 2017 injury). Specifically, he was “moving like 200 2-by-4s, 20-foot long, from one place to another” for four or five hours when the area between his shoulder and neck started to get stiff. He told his foreman that he couldn’t lift anymore with his shoulder hurting, and when he got off a few hours later, he told his superintendent that his “shoulder up in [his] neck” was sore. The superintendent asked him if he wanted to make a report, but McClanahan declined because he didn’t think it was that bad.
But when McClanahan woke up the next day, his arm and shoulder were stiff. He went to a doctor that night who advised taking a few days off work because his shoulder may be overworked. McClanahan reported this to DPR, but he did not see a workers’ compensation doctor until August 10, 2017. In his view, DPR caused the delay.
Three DPR employees disagreed with McClanahan’s account. Both the foreman and the superintendent stated that McClanahan did not report an injury to them on July 25, 2017. And the DPR safety manager who prepared the incident report testified that to his knowledge, McClanahan did not report an injury to anyone on July 25, 2017. DPR’s evidence included the employee sign out sheet for July 25, 2017, that indicated McClanahan signed out at 3:00 p.m. and checked the box indicating he was not injured.1 The safety manager also testified he made several attempts to take McClanahan to the workers’ compensation clinic between July 27, 2017, and August 7, 2017, in accordance with DPR policy, but McClanahan never showed up.
In a deposition, McClanahan testified DPR was the first place he ever had right shoulder pain, but at trial he admitted he suffered an industrial injury below his right elbow in 2013, a few years before working for DPR (the 2013 injury), and felt pain in his right shoulder as a result. He also testified he never went to a doctor for right shoulder pain before July 2017, but medical records showed that he sought or obtained care for shoulder pain or strain several times between 2013 and 2015, had an MRI of his right shoulder in 2014, and was diagnosed with a right shoulder condition in 2015. The records also indicated that he sought treatment for impingement in the right shoulder after a tree branch fell on it in 2015, but McClanahan could not remember a tree ever falling on his shoulder.
According to Dr. McGahan’s evaluation, McClanahan sustained “an industrial injury to his right shoulder arising out of and caused by the industrial exposure of July 25, 2017.” Dr. McGahan found it clear that McClanahan had preexisting right shoulder pathology but concluded it was “medically probable that [McClanahan’s] work duties on July 25, 2017, contributed to a worsening of his right shoulder pain.” In a supplemental report, Dr. McGahan stated that if “McClanahan is not a credible witness, then this certainly would call into question the credibility of his claim. Under this circumstance, the incident of July 25, 2017, may simply represent an exacerbation of his prior industrial injury rather than aggravation.
Over DPR’s objection, the workers’ compensation judge (WCJ) admitted the Hanley reports because DPR had received them before the mandatory settlement conference. In the first report, Dr. Hanley noted that some of McClanahan’s providers were suspicious about the validity of his complaints. In a supplemental report, Dr. Hanley concluded the “red flags” in McClanahan’s history were no longer of concern.
Based on McClanahan’s “credible testimony, the treatment records, and the findings by QME Dr. McGahan,” the WCJ concluded that McClanahan sustained an injury to his right shoulder arising out of and in the course of employment on July 25, 2017.
After reconsideration, the WCAB affirmed the WCJ’s determination on August 22, 2024 in a two-to-one decision. The affirming board members found that McClanahan erred by omitting the Hanley reports from the pretrial conference statement but concluded the error was harmless for two reasons: (1) the WCJ did not rely on the Hanley reports to find the industrial injury; and (2) the WCJ retains the discretion to determine if evidence should be admitted into the record as a matter of due process.
The Court of Appeal agreed to hear the case, and after it's review annulled the board’s decision and remanded for further proceedings in the unpublished case of DPR Construction v. Workers' Compensation Appeals Board CA3 - C100254- (May 2025).
On appeal, Petitioners contend the board exceeded its powers in two ways: (1) by failing to state the reasons for finding McClanahan credible and (2) by admitting two medical reports that were not listed in the pretrial conference statement. The Court of Appeal disagreed with petitioners as to the first contention but agreed as to the second.
In workers’ compensation proceedings, discovery closes on the date of the mandatory settlement conference. ( at p. 1164; § 5502, subd. (d)(3).) If the claim is not resolved at the conference, the parties must file a pretrial conference statement noting the specific issues in dispute, listing the exhibits, and disclosing witnesses. (§ 5502, subd. (d)(3); Cal. Code Regs., tit. 8, § 10759, subd. (b).) Evidence not disclosed or obtained thereafter is not admissible unless the proponent can demonstrate it was not available or could not have been discovered by the exercise of due diligence before the settlement conference. (§ 5502, subd. (d)(3).)
The purpose of this requirement is two-fold: (1) to “eliminate the element of surprise in workers’ compensation proceedings” and (2) “ ‘ “ ‘to guarantee a productive dialogue leading, if not to expeditious resolution of the whole dispute, to thorough and accurate framing of the stipulations and issues for hearing.’ ” ’ ” (Telles Transport, Inc. v. Workers’ Comp. Appeals Bd. (2001) 92 Cal.App.4th 1159, at pp. 1164, 1167.) The board abuses its discretion when it relieves a party from the sanctions of section 5502 without that party showing good cause. (San Bernardino Community Hospital v. Workers’ Comp. Appeals Bd. (1999) 74 Cal.App.4th 928, 938.
Section 5502 establishes the “bounds of discretion in the [WCJ] for keeping discovery open after the mandatory settlement conference.” (County of Sacramento v. Workers’ Comp. Appeals Bd. (1999) 68 Cal.App.4th 1429, 1433.) “[D]isregard for the statutory procedural mechanisms for resolving workers’ compensation cases is inappropriate.” (Ibid.) Such disregard is not subject to harmless error analysis. (San Bernardino, supra, 74 Cal.App.4th at p. 938.) - Tulare Doctor Pleads Guilty to Distributing Misbranded COVID Drugson May 20, 2025 at 4:11 PM
Stephen D. Meis, M.D., 73, formerly of Visalia, pleaded guilty to one count of introduction of misbranded drugs into interstate commerce.
According to court documents, Meis was the Medical Director of Golden Sunrise Pharmaceutical Inc. and Golden Sunrise Nutraceutical Inc. that manufactured, marketed, and sold products claiming to effectively treat a variety of medical conditions.
Beginning on March 30, 2020, Meis and Golden Sunrise’s Chief Executive Officer Huu Tieu, 62, of Porterville, began selling a set of herbal mixtures they called the “Emergency D-Virus Plan of Care” as a COVID-19 treatment. The treatment consisted of a box containing various vials of Golden Sunrise drug products, including one called “Imunstem,” together with an “Emergency D-Virus Plan of Care” information sheet. Meis and Tieu mailed the products to various practitioners, public officials, and other individuals both inside and outside of California.
The labeling for the drugs, including the information sheet that accompanied the drugs, was false and misleading and stated that ImunStem and other Golden Sunrise products were “uniquely qualified to treat and modify the course of the virus epidemic in China and other countries.”
Golden Sunrise falsely claimed the products had been the first dietary supplement in the United States to be approved as a prescription medicine by the U.S. Food and Drug Administration (FDA) to treat the COVID-19 virus. In fact, the drugs were not FDA approved, and no Golden Sunrise product had ever been approved by the FDA for any purpose.
On June 12, 2024, Tieu was sentenced to 18 months in prison for introduction of misbranded drugs into interstate commerce.
Meis is scheduled to be sentenced by U.S. District Judge Jennifer L. Thurston on July 14, 2025. Meis faces a maximum statutory penalty of 12 months in prison and a $100,000 fine. The actual sentence, however, will be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables.
This case is the product of an investigation by the FDA Office of Criminal Investigations, the U.S. Department of Health and Human Services Office of Inspector General, and the Federal Bureau of Investigation with assistance from the Tulare County District Attorney’s Office. Assistant U.S. Attorneys Jeffrey A. Spivak and Emilia P.E. Morris are prosecuting the case. - PAGA Action Prevailing Employer May Not Recover Costs From LWDAon May 19, 2025 at 11:32 AM
In March 2017, Kelly Rose, a former employee of Hobby Lobby Stores, Inc., notified the California Labor and Workforce Development Agency (LWDA) and Hobby Lobby that she intended to seek civil penalties under PAGA on behalf of herself, the State of California, and other hourly-paid individuals who were employed by Hobby Lobby in California as cashiers or who were assigned cashier duties. Rose’s claims were based on allegations that Hobby Lobby violated the so-called “suitable seating” provisions of Industrial Welfare Commission Wage Order No. 7-2001 by not providing seats for cashiers. (Cal. Code Regs., tit. 8, § 11070, subds. 1, 14.)
After the statutory deadline for the LWDA to respond to the notice had passed, Rose filed a civil action against Hobby Lobby alleging two causes of action based on the facts and theories alleged in her PAGA notice. The litigation proceeded for several years, and eventually a bench trial was held that resulted in a judgment for Hobby Lobby on both causes of action.
In a separate appeal, the Court of Appeal affirmed the judgment. (Rose v. Hobby Lobby Stores, Inc. (March 25, 2025, A168301) [nonpub. opn.].) After judgment was entered, Hobby Lobby filed a memorandum of costs totaling $474,707.80.
The trial court issued an order inviting the LWDA, which had not participated in the litigation, to file an amicus brief addressing its liability for an award of costs to a prevailing defendant in a PAGA action. At the trial court’s direction, Hobby Lobby served the order on the LWDA, at which point the LWDA first learned of Hobby Lobby’s attempt to recover its costs. The LWDA then filed a motion to intervene, which the trial court granted.
The trial court concluded that the LWDA is responsible for costs incurred by defendants who prevail on PAGA claims, but struck certain cost items that Rose had challenged, resulting in an award of costs against the LWDA in the amount of $124,585.24. The LWDA timely appealed from the costs order. The trial court did not award Hobby Lobby any costs against Rose, and Rose is not a party to this appeal.
The LWDA appealed, raising an issue of first impression: Is the LWDA liable for the litigation costs incurred by a prevailing defendant in an action filed under PAGA?
The Court of Appeal concluded that costs are not recoverable against the LWDA where it did not participate in the litigation. Accordingly, it reversed the trial court costs order in the published case of Rose v. Hobby Lobby Stores CA1/2 - A169640 (May 2025).
In seeking costs from the LWDA, Hobby Lobby relied on Code of Civil Procedure §1032(b), the general cost-recovery statute, which provides that a prevailing party is entitled to recover its costs “[e]xcept as otherwise expressly provided by statute,” and Code of Civil Procedure section 1028, which provides that when the State is a party to an action costs are “awarded against it on the same basis as against any other party.”
PAGA provides that “[a]ny employee who prevails in any action shall be entitled to an award of reasonable attorney’s fees and costs” (Lab. Code, § 2699, subd. (k)(1)), but says nothing about prevailing employers. Hobby Lobby argues that in view of the guidance provided by our Supreme Court in Murillo v. Fleetwood Enterprises, Inc. (1998) 17 Cal.4th 985, 989 for interpreting so-called “one-way” fee and cost shifting statutes like the one in PAGA, the Court of Appeal should conclude that PAGA does not contain an express exception to section 1032(b) and therefore as a prevailing defendant Hobby Lobby is entitled to recover its costs.
In Murillo, the Supreme Court construed a fee and cost shifting provision in the Song-Beverly Act (Civ. Code, § 1790 et seq), California’s automobile “lemon law,” which expressly permits a prevailing plaintiff-buyer to recover costs and attorney fees but is silent with respect to a prevailing defendant-seller. Murillo held that silence does not create an express exception to section 1032(b); therefore, a prevailing defendant-seller in a case brought under the Song-Beverly Act is entitled to recover its costs under section 1032(b). (Id. at p. 991.)
The LWDA argues that legislative history shows that Labor Code section 2699, subdivision (k)(1) was intended to displace the general cost recovery rule of section 1032(b), and that Murillo, which concerns a consumer protection statute rather than a provision of the Labor Code, is inapposite.
Hobby Lobby argued unpersuasively that the LWDA was nevertheless a party to Rose’s action from its commencement because Rose filed her PAGA suit as the LWDA’s agent, and that under Civil Code section 2330 the LWDA, as principal, is responsible for the acts and liabilities of its agent.
"The LWDA did not sue Hobby Lobby. The LWDA was not a party to Rose’s lawsuit, nor did it take any action in the lawsuit until it moved to intervene, which it did only after it got word that Hobby Lobby sought to impose its costs on the LWDA. Accordingly, Hobby Lobby cannot recover its costs from the LWDA."
"Because we conclude that the LWDA was not a party to Rose’s PAGA action, Code of Civil Procedure section 1028, which provides that when the State is a party costs are to be awarded against it on the same basis as against any other party, has no application here."
"Hobby Lobby also argues that even if the LWDA was not a party to Rose’s PAGA action, it is liable for costs as the real party in interest. This argument is unpersuasive because Hobby Lobby cites no case in which litigation costs were imposed against a real party in interest that did not participate in the litigation." - Ninth Circuit Upholds AB 5 Against Independent Truckers' Challengeon May 19, 2025 at 11:32 AM
The California Trucking Association (CTA) filed a lawsuit in November 2019 in the U.S. District Court for the Southern District of California challenged the application of California’s Assembly Bill 5 (AB 5) to the trucking industry, specifically arguing that it violates the Dormant Commerce Clause of the U.S. Constitution, among other claims.
AB 5, enacted in 2019 and effective January 1, 2020, codified the "ABC test" to determine whether workers are classified as employees or independent contractors. The "B" prong of the test, which requires that a worker perform work outside the usual course of the hiring entity’s business to be considered an independent contractor, effectively prohibits the traditional leased owner-operator model in trucking, as owner-operators’ work (hauling freight) is central to a motor carrier’s business.
Plaintiffs argued that AB 5 was preempted by the Federal Aviation Administration Authorization Act of 1994 (FAAAA), which prohibits states from enacting laws affecting a motor carrier’s prices, routes, or services. The Dormant Commerce Clause and Equal Protection Clause were also cited as grounds for challenge.
On December 31, 2019, District Judge Roger Benitez granted a preliminary injunction, halting AB 5’s enforcement against the trucking industry, finding that the law likely violated FAAAA preemption by restricting motor carriers’ ability to use independent contractors, a core component of interstate trucking. The Ninth Circuit Court of Appeals reversed this injunction in its April 2021 published opinion, ruling that AB 5 was a generally applicable labor law that did not sufficiently impact prices, routes, or services to be preempted by the FAAAA. The injunction remained in place pending further appeals. The U.S. Supreme Court declined to review the case in June 2022, returning it to the Southern District of California and dissolving the injunction.
The Owner-Operator Independent Drivers Association (“OOIDA”) is the international trade association representing the interests of independent owner-operators and professional drivers on all issues that affect truckers. More than 150,000 members of OOIDA are men and women in all 50 states and Canada who collectively own and/or operate more than 240,000 individual heavy-duty trucks and small truck fleets. Its national headquarters is located on the outskirts of Kansas City, in Grain Valley, MO.
OOIDA joined the litigation in 2022 as an intervenor, focusing on the interests of small-business truckers, particularly those operating interstate. After the Supreme Court’s denial, CTA and OOIDA filed renewed motions for a preliminary injunction, combining arguments on FAAAA preemption, the Dormant Commerce Clause, and Equal Protection. They contended that AB 5’s ABC test, by effectively banning leased owner-operators, imposed an undue burden on interstate commerce, violating the Dormant Commerce Clause. This clause, inferred from Article I, Section 8 of the U.S. Constitution, prohibits states from enacting laws that discriminate against or excessively burden interstate commerce.
On March 15, 2024, Judge Benitez rejected the renewed motions for a preliminary injunction, ruling against CTA and OOIDA on all claims. He concluded that AB 5 did not violate the Dormant Commerce Clause, as it lacked discriminatory intent or effect favoring California truckers over out-of-state truckers. Without such discrimination, the court declined to engage in Pike balancing, noting that only a “small number of cases” have found nondiscriminatory burdens substantial enough to violate the clause.
In August 2024, the CTA announced it would not pursue further appeals, ending its four-and-a-half-year legal battle. OOIDA continued the fight, filing an appeal with the Ninth Circuit in August 2024. Their brief focused on the Dormant Commerce Clause, arguing that AB 5’s ABC test “effectively prohibits an entire sector of small business truckers” from operating as independent contractors in California, creating a significant burden on interstate commerce. They also reiterated the Equal Protection claim, citing the B2B exemption’s incompatibility with federal regulations.
California’s Attorney General responded in November 2024, asserting that AB 5 does not prohibit owner-operators outright and that its regulatory costs do not trigger Pike balancing. The state argued that the law’s intent was to protect workers, not to discriminate against interstate commerce.
On May 16, 2025 the Court of Appeals for the 9th Circuit issued an unpublished Memorandum Opinion in the case of Owner-Operator Independent Drivers Association, Inc. v. Bonta - Case # 3:18-cv-02458-BEN-DEB. It concluded - among other findings - that "AB 5 does not violate the dormant Commerce Clause. “The dormant Commerce Clause is not a roving license for federal courts to decide what activities are appropriate for state and local government to undertake, and what activities must be the province of private market competition.” United Haulers Ass’n, Inc. v. Oneida-Herkimer Solid Waste Mgmt. Auth., 550 U.S. 330, 343 (2007). " - Fresno Health System to Pay $31.5 M to Resolve Kickback Caseon May 15, 2025 at 10:26 AM
Community Health System and its affiliate Physician Network Advantage Inc. have agreed to pay $31.5 million to the United States to resolve allegations that they violated the False Claims Act based on financial benefits provided to referring physicians. Community Health System operates in Fresno County and includes hospitals Community Regional Medical Center and Clovis Community Medical Center.
The civil settlement resolves allegations that Community Health System and Physician Network Advantage Inc. (PNA) provided several types of extravagant benefits to induce physicians in the Fresno area to refer their patients to Community facilities for medical services, in violation of the False Claims Act. PNA is a health care technology business formed and funded by Community to support Fresno-area physicians’ adoption of the electronic health records platform used by Community. The United States contends that PNA also played a key role in securing business for Community by unlawful means. In a custom-built lounge located on premises at PNA’s offices, known as HQ2, PNA provided expensive wine, liquor, cigars, and meals to referring physicians, with the knowledge and funding of Community.
The settlement also resolves allegations that Community and PNA provided financial subsidies for electronic health records technology and equipment used by certain physicians in their private offices in return for the referral of governmental health care program patients to Community. Further, the settlement resolves allegations that Community paid bonuses to certain physicians ostensibly for participation in clinical integration activities, when the real purpose of the bonuses was to reward referrals.
The United States contends that these financial benefits violated the federal Anti-Kickback Statute, resulting in false claims for the medical services referred by physicians receiving the benefits, that were submitted to governmental health care programs. The United States also contends that the conduct described above created financial relationships with referring physicians under the Physician Self-Referral Law (known as the “Stark Law”). The Stark Law seeks to safeguard the integrity of the Medicare program by prohibiting a hospital from billing for certain services referred by physicians with whom the hospital has a financial relationship, unless that relationship satisfies one of the law’s statutory or regulatory exceptions, which the United States contends were not met.
In connection with the settlement, Community entered into a five-year Corporate Integrity Agreement with HHS-OIG that requires, among other conditions, the implementation of a risk assessment and internal review process designed to identify and address evolving compliance risks. The Corporate Integrity Agreement also requires an independent review organization to annually assess the policies and systems to track arrangements with some referral sources.
The settlement includes the resolution of claims brought under the qui tam or whistleblower provisions of the False Claims Act by relator Michael Terpening. Under those provisions, a private party can file an action on behalf of the United States and receive a portion of any recovery from that action. The qui tam case is captioned United States ex rel. Terpening v. Fresno Community Hospital and Medical Center, et al., 1:19-CV-01699 (E.D. Cal.). As part of the settlement announced today, Mr. Terpening will receive approximately $5 million.
The resolution obtained in this matter was the result of a coordinated effort between the U.S. Attorney’s Office for the Eastern District of California and HHS-OIG with assistance from the Federal Bureau of Investigation and the U.S. Postal Service Office of Inspector General. Assistant U.S. Attorney David Thiess handled the case for the U.S. Attorney’s Office.
The claims resolved by this settlement are allegations only, and there has been no determination of liability. - Ventura County Unlicensed Physician Re-Arrested for Practicingon May 15, 2025 at 10:26 AM
The Ventura County District Attorney Erik Nasarenko announced that Nitun “Nate” Dayalghai Ahir (DOB 06/17/81), of Thousand Oaks, was arraigned for practicing medicine without a license, in violation of Business and Professions Code section 2052.
Ahir was out on bail in case number 2024030574, in which he is alleged to have practiced medicine without a license and represented himself as a doctor at Regen Spine & Nerve, in Ventura, when the District Attorney’s Office received complaints that Ahir was continuing to practice medicine without a license.
In his new case, Ahir is alleged to have unlawfully provided medical services to victims only days after being arraigned in case 2024030574. He is further charged with using the term “Doctor” and the prefix “Dr.” to imply he is a licensed medical professional when he is not. Judge David Hirsch explicitly made a condition of Ahir’s bail that he may not practice medicine, solicit medical business, attempt to treat patients, or receive compensation for any form of medical work, or he faces remand into custody.
According to the California Department of Consumer Affairs, Ahir is not licensed in any capacity – as a doctor, surgeon, nurse, nurse practitioner, chiropractor, or otherwise – in the State of California, nor is he a licensed physician in any other state.
The District Attorney requests that any member of the public who Ahir has attempted to treat contact Investigator Eric Jensen at Eric.Jensen@ventura.org or by calling 805-662-1739. The public is urged to review the licensure status of any medical professionals they are considering seeing by visiting the Department of Consumer Affairs' professional
This case was investigated by the Department of Consumer Affairs, Health Quality Investigations Unit. Both of Ahir’s cases are set for early disposition conference on June 25, 2025, at 1:30 p.m. in Courtroom 12 of the Ventura County Superior Court. He remains out of custody on $50,000 bail. - Jury Trial Rights Attach to Claim for Unruh Civil Rights Act Damageson May 14, 2025 at 1:43 PM
Plaintiff Theresa Brooke is a woman with disabilities who uses a wheelchair. Along with her husband, she frequents California hotels to test their compliance with disability access laws. On one such testing trip in August 2023, Brooke and her husband visited the Ramada by Wyndham Burbank Airport, a hotel in Burbank, California. When they arrived, however, architectural barriers allegedly deterred Brooke from entering.
Brooke sued the hotel’s owner, Defendant Tsay JBR, LLC, asserting violations of Title III of the Americans with Disabilities Act (ADA), 42 U.S.C. § 12181 et seq., and California’s Unruh Civil Rights Act, Cal. Civ. Code § 51 et seq. (West 2025).
The California The Unruh Act similarly creates a private right of action for people with disabilities, along with other enumerated groups, who are denied “full and equal” access to California businesses. See Cal. Civ. Code § 51(b). As part of those protections, the Unruh Act provides that any violation of the ADA is also a violation of its provisions. See id. § 51(f).
Although private parties can obtain only injunctive relief under the ADA, they can recover actual and statutory damages under the Unruh Act. Id. § 52(a); see Arroyo v. Rosas, 19 F.4th 1202, 1206 (9th Cir. 2021) (explaining that the Unruh Act effectively creates a state-law “damages remedy that is not available under the ADA”).
Accordingly, Brooke sought injunctive relief under the ADA, statutory damages under the Unruh Act, and declaratory relief and attorney’s fees under both.
The district court granted in part and denied in part a motion for summary judgment brought by Brooke. The court concluded that Tsay JBR had violated the ADA because the hotel’s passenger loading zone - an area for vehicle pickup and drop-off - lacked an access aisle for disabled guests. As a remedy, the court ordered Tsay JBR to paint a blue access aisle in front of the loading zone.
Because Brooke established an ADA violation, she also necessarily established an Unruh Act violation. But not all Unruh Act violations automatically entitle a plaintiff to statutory damages. When a violation is construction-related, the Unruh Act only permits statutory damages if the plaintiff personally encountered the violation or was deterred by it. Id. § 55.56(a)–(b). The district court determined that Brooke had not established that fact on summary judgment.
With only that factual issue left, the court converted the scheduled jury trial to a bench trial, concluding that the jury- trial right did not attach to claims for statutory damages under section 52(a) of the Unruh Act.
Tsay JBR petitioned the Court of Appeals for the 9th Circuit for a writ of mandamus, asking it to direct the district court to conduct a jury trial on the issue of Brooke’s entitlement to statutory damages. The panel held that the Seventh Amendment entitles parties in federal court to a jury trial on a claim for statutory damages under § 52(a) of the Unruh Act in the published case of Tsay JBR LLC v United States District Court for the Central District of California - 24-5234 (May 2025).
The Seventh Amendment to the United States Constitution provides that in “[s]uits at common law, where the value in controversy shall exceed twenty dollars, the right of trial by jury shall be preserved.” In this case the Court of Appeals considered whether a defendant in an action for statutory damages under section 52(a) of California’s Unruh Civil Rights Act is entitled to a jury trial.
"So long as a case involves a legal claim, the right to a jury trial attaches, even if the case also seeks equitable relief. See Curtis v. Loether, 415 U.S. 189, 196 n.11 (1974) (“The [jury-trial] right cannot be abridged by characterizing the legal claim as ‘incidental’ to the equitable relief sought.”); Dairy Queen, Inc. v. Wood, 369 U.S. 469, 473 n.8 (1962)."
"The statutory damages in section 52(a) of the Unruh Act are thus a legal remedy. Because both the historical analog and the nature of the remedy reveal that Brooke’s claim is legal, the Court of Appeals held that the Seventh Amendment entitles parties in federal court to a jury trial on a claim for statutory damages under section 52(a) of the Unruh Act."
- NCCI Report: Workers’ Comp System Remains Strongon May 14, 2025 at 1:43 PM
The performance of the workers compensation system remains strong according to the 2024 metrics that the National Council on Compensation Insurance (NCCI) just released.
Workers compensation premium decreased 3% in 2024. Private carriers produced their 11th consecutive year of underwriting profitability with a Calendar Year 2024 combined ratio of 86. It is the 8th consecutive year with a combined ratio below 90 for the workers compensation insurance market.
"Workers compensation is a product where compassion and analytics work hand-in- hand - protecting and caring for employees while also leveraging data to make the entire system more effective and sustainable," said NCCI President and CEO Tracy Ryan.
NCCI’s State of the Line Report and the State of the Line Guide include key insights:
- - Workers compensation net written premium decreased 3% in 2024. There are two contributing factors: payroll and rate on payroll, mostly represented by the loss cost. Payroll growth is slowing, reverting back to the long-term average. Loss costs continue to decline, but more moderately.
- - The Calendar Year 2024 combined ratio for workers compensation is 86%, a sign of underwriting strength for the system. Workers compensation (WC) has one of the lowest combined ratios among property/casualty. In fact, 2024 was the 8th consecutive year with a combined ratio under 90% and the 11th consecutive year of underwriting gains.
- - Workers compensation’s Accident Year 2024 combined ratio is 99% with prior years continuing to experience downward reserve development.
- - NCCI estimates a redundant industry reserve position of $16 billion. That’s a decrease from the $18B estimated redundancy in 2023. While still a strong financial position, this is the first year with a slight reduction in the estimated redundancy.
- - Lost-time claim frequency declined by 5% in 2024. The latest year’s frequency decline outpaces the long-term average, although not to the extent of the prior year. More than half of this decrease is due to the reduction in number of claims.
- - Severity grew in 2024 with increases of 6% for medical claim severity and 6% for indemnity claim severity. Indemnity severity grew faster than wages, and medical severity grew faster than the Workers Compensation Weighted Medical Price Index (WCWMI). For medical, price is only one part of the story. The other part is utilization, and this year utilization contributes to a majority of the increase.
"The workers compensation system continues an era of exceptional performance with strong results and a financially healthy line," said Donna Glenn, FCAS, MAAA, Chief Actuary, NCCI. "And while there are early indications of potential headwinds on the horizon, the industry is positioned well to navigate these challenges." - Six Month Delay in Requesting Arbitration Constitutes "Waiver"on May 13, 2025 at 4:10 PM
Stephen Hofer is a licensed attorney who founded Aerlex Law Group (the Group), which specializes in aviation law. In 2008, Hofer was the sole partner of the Group and hired Vicky Boladian as a part-time contract attorney. Hofer and Boladian dispute whether their professional relationship became a romantic relationship between 2011 and 2017.
In 2013, Hofer and Boladian formed Aerlex Tax Services, LLC (the tax LLC), which would provide “tax-related services” to the Group’s clients and “others within the aviation industry.” Hofer had a 55 percent equity interest in the tax LLC; Boladian, a 45 percent interest. In 2017 and 2018, Hofer and Boladian had a falling out, which resulted in litigation. In September 2020, they agreed to settle the pending litigation by executing three agreements: 1) Settlement Agreement, 2) Amended and Restated Operating Agreement for the tax LLC and 3) Amended and Restated Buy-Sell Agreement of the tax LLC. These agreements contained provisions to arbitrate disputes.
In March 2023, Boladian asked Hofer to change the business form of the tax LLC to an LLP to avoid the potential of having a limited liability company engaged in the unauthorized practice of law. In August 2023, Hofer and Boladian dissolved the tax LLC and shifted its assets to Aerlex Tax Services, LLP (the tax LLP)—with the same 55/45 percent split of ownership. Two weeks later, Boladian formed the Boladian Aviation Law Group, APC (BALG). She then withdrew from the tax LLP, removing what she represented to be 45 percent of the physical office furniture and nearly all of the tax LLP’s clients.
On September 19, 2023, Hofer sent Boladian a letter exploring a possible settlement before “commencing formal litigation” and asserting his “free[dom] to seek a judicial resolution” of their disputes. The parties discussed mediation, but could not agree on a mediator.
On October 16, 2023, Hofer, the Group, the tax LLC and the tax LLP (collectively, the Hofer plaintiffs) filed a lawsuit against Boladian and BALG. The Hofer plaintiffs alleged 13 causes of action and sought compensatory damages, injunctive and equitable relief, treble damages, punitive damages, and attorney fees. Although Hofer had, prior to filing the complaint, “agree[d] to file in arbitration” if Boladian consented to BALG participating in arbitration, the Hofer plaintiffs in the complaint nowhere mentioned arbitration under any of the three agreements and did not pray for an order compelling arbitration.
On October 31, 2023, the Hofer plaintiffs applied ex parte for a temporary restraining order (TRO) seeking to prevent Boladian and BALG from performing any work for the clients of the tax LLP or the Group, from using any of the tax LLP’s employees, and from removing or using any tangible property or data taken from the tax LLP. Nowhere in the application did they mention arbitration under any of the agreements. The trial court denied the application
On November 16, 2023, the Hofer plaintiffs moved for a preliminary injunction, trying to remedy the defects with their earlier TRO application. Once again, the Hofer plaintiffs argued their lawsuit had merit and nowhere mentioned arbitration.
In the midst of these motions, the Hofer plaintiffs inquired whether Boladian and BALG would “be seeking to move this case into arbitration”; counsel responded that they had “no plans” to do so and this communication shed no light on the Hofer plaintiffs’ intent to do so.
On December 8, 2024 (while the Hofer plaintiffs’ motion for a preliminary injunction was still pending), Boladian and BALG demurred to nine of the 13 causes of action. On January 29, 2024, the Hofer plaintiffs propounded a total of 734 discovery requests to Boladian and BALG. The Hofer plaintiffs also subpoenaed a number of third- party witnesses for depositions in February 2024. They also noticed the deposition of Boladian for March 2024.
In anticipation of the case management conference, the Hofer plaintiffs on March 14, 2024, filed a case management statement. In some respects, the Hofer plaintiffs’ case management statement acknowledged the possibility arbitrating the dispute. The Hofer plaintiffs also posted their jury fees.
On April 23, 2024, Boladian filed a cross-complaint against Hofer and the Group, alleging five causes of action. On April 26, 2024—more than six months after filing their complaint and more than four months after the denial of the preliminary injunction, but just three days after the filing of the cross-complaint - the Hofer plaintiffs filed a motion to compel arbitration, invoking the arbitration clauses in the settlement agreement, amended operating agreement, and amended buy-sell agreement.
The trial court denied the motion to arbitrate ruling that the Hofer plaintiffs had waived their right to compel arbitration. Applying the waiver standard articulated in St. Agnes Medical Center v. PacifiCare of California (2003) 31 Cal.4th 1187, the court found “that [the Hofer plaintiffs] waived the right to arbitrate by filing suit in this court and substantially and vigorously litigating it for over seven months,” concluding that this conduct was “fundamentally incompatible with the expediency, efficiency, and cost- effectiveness associated with utilizing arbitration” and that this conduct “prejudiced” Boladian and BALG.
The Court of Appeal affirmed the trial court's order in the published case of Hofer v. Boladian CA2/5 - B339542 (May 2025).
Under the California Arbitration Act (Code Civ. Proc., § 1280 et seq.) (the Act), a party with a contractual “right to compel arbitration” of a dispute may “waive[]” that right. (§ 1281.2, subd. (a).) In Quach v. California Commerce Club, Inc. (2024) 16 Cal.5th 562 (Quach), - decided a month after the trial court’s ruling - the Supreme Court overruled the arbitration-specific definition of waiver embraced in St. Agnes Medical Center v. PacifiCare of California (2003) 31 Cal.4th 1187 (St. Agnes) in favor of the “generally applicable” definition of waiver. (Quach, at p. 578.)
St. Agnes’s arbitration-specific definition of waiver called upon trial courts to evaluate six different factors - namely, “‘“(1) whether the party’s actions are inconsistent with the right to arbitrate; (2) whether ‘the litigation machinery has been substantially invoked’ and the parties ‘were well into preparation of a lawsuit’ before the party notified the opposing party of an intent to arbitrate; (3) whether a party either requested arbitration enforcement close to the trial date or delayed for a long period before seeking a stay; (4) whether a defendant seeking arbitration filed a counterclaim without asking for a stay of the proceedings; (5) ‘whether important intervening steps [e.g., taking advantage of judicial discovery procedures not available in arbitration] had taken place’; and (6) whether the delay ‘affected, misled or prejudiced’ the opposing party.”’” (Id. at p. 1196.)
"Quach applies retroactively to this direct appeal." Quach held that a waiver occurs under the Act if, by clear and convincing evidence, it is shown that a party has “intentionally relinquished or abandoned” its known right to compel arbitration. (Id. at pp. 569, 584.)
"In this case, the litigants seeking to compel arbitration initiated this lawsuit by filing a complaint in court and, while in the judicial forum, sought two forms of preliminary injunctive relief, opposed a demurrer, propounded more than 700 discovery requests, demanded a jury trial in their case management conference statement and represented they would be litigating substantive motions, and posted jury fees. It was not until the opposing party filed a cross-complaint that the litigants filed the motion to compel arbitration - more than six months into the litigation in court."
The litigants’ conduct in this case constitute a waiver under Quach. - AI Outperforms Radiologists' Detection of Breast Cancerson May 13, 2025 at 4:10 PM
A new study - "Mammographic Classification of Interval Breast Cancers and Artificial Intelligence Performance" - conducted at the University of California, Los Angeles (UCLA) and published in in the Journal of the National Cancer Institute, investigates interval breast cancers (IBCs) - cancers diagnosed within 12 months after a negative screening mammogram - in a U.S.-based annual screening program.
The research aimed to classify IBCs based on their mammographic visibility and evaluate the performance of an artificial intelligence (AI) tool in detecting these cancers, particularly in a setting that uses both digital mammography (DM) and digital breast tomosynthesis (DBT).
The study analyzed 184,935 screening mammograms (65% DM, 35% DBT) from 49,244 women screened between 2010 and 2019 at a U.S. tertiary care academic center participating in the Athena Breast Health Network. From this cohort, 148 IBCs were identified in 148 women (mean age 61 ± 12 years), defined as ductal carcinoma in situ (DCIS) or invasive carcinomas diagnosed within 12 months of a negative mammogram (BI-RADS 1 or 2).
Eight fellowship-trained breast radiologists, with 3–24 years of experience, retrospectively classified these IBCs into six categories adapted from European guidelines: missed-reading error (visible but missed), minimal signs-actionable (subtle signs potentially detectable), minimal signs-non-actionable (subtle signs not reasonably detectable), true interval (not present at screening), occult (not visible on mammography but detectable by other modalities), and missed-technical error (missed due to technical issues like positioning).
A deep-learning AI tool (Transpara v1.7.1, ScreenPoint Medical) assigned risk scores (1–10) to 131 of the 148 negative index mammograms (17 were excluded due to breast implants or file conversion issues). Exams scoring ≥8 were considered "flagged" for elevated risk. Radiologists assessed whether AI markings accurately localized the IBC site, comparing performance across IBC types and correlating with patient and tumor characteristics.
The AI tool flagged 76% of the 131 scored mammograms, with the highest flagging rates for missed-reading errors (90%), minimal signs-actionable (89%), and minimal signs-non-actionable (72%). These mammographically visible types also received higher mean AI scores (9.5, 8.9, and 8.3, respectively) compared to non-visible types like true interval (7.3) and occult (7.9). AI accurately localized the cancer site in 47% of flagged exams, with the highest accuracy for missed-reading errors (68%) and minimal signs-actionable (62%), but lower for occult (22%) and missed-technical errors (0%). Overall, AI flagged 56% of mammographically visible IBCs versus 20% of non-visible ones, suggesting a potential 30% reduction in IBCs if AI-supported detection were implemented.
The study highlights the potential of AI to enhance the detection of mammographically visible IBCs, particularly those missed or with subtle signs, in a U.S. annual screening program using both DM and DBT. Unlike European studies, the lower rate of true interval cancers (6%) underscores the benefit of annual screening in reducing IBCs. However, AI’s ability to flag occult and true interval cancers, despite lower localization accuracy, raises questions about its predictive value and clinical utility, as radiologists may struggle to act on flagged exams without visible abnormalities.
Limitations include the retrospective design, small sample sizes for some IBC subtypes, and the use of a single AI vendor, which may limit generalizability. The mix of DM and DBT reflects real-world practice but complicates comparisons. Selection bias from the Athena study cohort and technical issues with unscored exams are additional constraints. Importantly, the study does not confirm whether AI-flagged exams would lead to earlier detection in practice, as radiologist recall decisions remain uncertain.
The study was supported by the National Institutes of Health, the Agency for Healthcare Research and Quality, and Early Diagnostics Inc., with no reported conflicts of interest. The data are available upon request from the corresponding author, Tiffany T. Yu, MD.