- Owners of SoCal Towing Companies Arrested for $6M Comp Fraudon March 12, 2026 at 11:25 AM
Brothers and tow company owners, Mark Hassan, 46, of Corona Del Mar, and Ahmed Hassan, 35 of Walnut, were arrested on multiple counts of felony insurance fraud after allegedly underreporting employee payroll and paying portions of employees’ wages in cash to defraud workers’ compensation insurance companies out of nearly 6 million dollars of insurance premiums.
The California Department of Insurance launched an investigation after receiving two fraud referrals from an insurance company alleging that Mark Hassan, owner of Hadley Tow, underreported his company’s payroll. The Department’s investigation expanded when it received a third fraud referral alleging his brother Ahmed Hassan, owner of California Heights Tow, filed a fraudulent employee injury claim against his insurance policy for a Hadley Tow employee.
Mark Hassen, also the owner of FMG Inc., was doing business as Hadley Tow based in Whittier, Courtesy Tow based in Sylmar, Crescenta Valley Tow based in La Crescenta, California Coach Towing based in Walnut, and several other tow companies across the greater Los Angeles area. He also held towing contracts with multiple law enforcement agencies throughout Southern California.
During the investigation, detectives learned Mark Hassan used his uninsured tow company, Courtesy Tow, as a “shell company” to conceal portions of Hadley Tow employee payroll to allegedly defraud workers’ compensation carriers of premiums they were owed. Ahmed Hassan, in an attempt to lower his company’s workers’ compensation insurance premiums also underreported employee wages.
In addition to hiding and misrepresenting employee wages to their workers’ compensation insurance providers, the Hassan brothers paid portions or all of employee wages without withholding standard deductions, which led to Employment Development Department opening a payroll tax evasion investigation.
For both Hadley Tow and California Heights Tow the brothers reported a combined payroll of $3,038,164 to their insurance carriers, but a forensic audit revealed the actual combined payroll for the two companies was $16,716,657. The illegal actions resulted in an estimated premium loss of $5,897,487.
Underreporting of workers' compensation insurance in California is illegal and undermines the financial stability of the insurance system, which shifts costs onto other policyholders. It also jeopardizes the availability of benefits for injured workers, hindering their access to necessary support. Unfair competition also arises as fraudulent businesses gain an advantage over ethical ones. Experts at the Department of Insurance are dedicated to protecting consumers by rigorously investigating cases of alleged illegal acts by insurance companies and individuals.
Mark Hassan was booked at the Los Angeles County Sheriff - Inmate Reception Center, and Ahmed Hassan was booked at the West Valley Detention Center in Rancho Cucamonga. This case is being prosecuted by the Los Angeles District Attorney’s Office.
- The Quiet Knee Protocol - Less Is More After Surgeryon March 12, 2026 at 11:25 AM
Knee replacement surgery is one of the most common procedures that the workers' compensation industry encounter in serious injury claims. When a warehouse worker blows out a knee, or a construction laborer's joint finally gives way after years of wear, total knee arthroplasty (TKA) often becomes the endgame of treatment. What happens after that surgery - the recovery timeline, the pain management, the return-to-work prognosis — matters enormously in evaluating and resolving these claims.
A recent development out of the nation's top-ranked orthopedic hospital may change the way clinicians approach post-surgical knee replacement recovery, with direct implications for workers' compensation practice.
In October 2025, researchers at Hospital for Special Surgery (HSS) in New York — ranked number one in orthopedics by U.S. News & World Report for sixteen consecutive years - presented results of a retrospective study on a recovery approach they call the "Quiet Knee" protocol". The findings were shared at the annual meeting of the American Association of Hip and Knee Surgeons (AAHKS).
The traditional approach to knee replacement recovery has long emphasized early, aggressive physical therapy - bending, walking, and pushing through pain as quickly as possible. The "no pain, no gain" mentality has been standard guidance for decades. The Quiet Knee protocol challenges that orthodoxy. Instead of aggressive early mobilization, the protocol focuses on controlling inflammation and swelling during the first ten days after surgery through restricted mobility, gentle passive range of motion, and intensive icing (cryotherapy). Structured telerehabilitation replaces the usual push toward immediate in-person physical therapy.
The rationale is physiological. According to the HSS researchers, overly aggressive early therapy can trigger a counterproductive cycle: the more a patient bends and walks in the first days after surgery, the more the knee swells, which increases pain, which limits the range of motion the therapy was supposed to restore. The Quiet Knee approach respects the body's inflammatory response and gives the surgical tissue time to begin healing before progressive rehabilitation starts.
The HSS study reviewed all of their total knee replacement patients from 2020 through 2024, comparing a cohort of 271 patients who followed the structured Quiet Knee protocol against groups that received either verbal guidance alone or traditional early-motion therapy. Early results suggest that patients following the protocol experienced a smoother recovery trajectory. Notably, the protocol was associated with a reduction in 90-day opioid exposure of more than 25 percent.
Why this matters: This protocol is likely to appear with increasing frequency in treatment plans and IME reports involving post-TKA recovery. The study gives institutional support to a conservative, rest-first rehabilitation approach - and the opioid reduction finding adds a significant data point to disputes involving post-operative pain management. Practitioners handling knee injury claims on either side should be aware of it.
- Court Strikes $1M Worker's Punitive Damages for Lack of Evidenceon March 11, 2026 at 2:19 PM
Hector Carreon worked as an order selector at U.S. Foodservice's La Mirada distribution facility. He alleged a pattern of sexual harassment at the warehouse, including a 2018 incident where a coworker tried to grab his genitals and made threatening remarks, and repeated threats from coworker Jesus Torres to sexually assault him in the freezer. Carreon claimed he reported these incidents to managers and his union representative, but was met with indifference or dismissive comments.
In July 2019, after being reinstated from an earlier termination through a union grievance, Carreon signed a "last chance agreement" that released US Foods from liability for all prior employment claims. About a month later, on August 29, 2019, Torres physically confronted Carreon in the frozen foods warehouse — pulling him off his pallet jack, throwing him onto shelves, and repeatedly thrusting his groin toward Carreon's face while coworkers watched and filmed. Afterward, Carreon followed Torres around the aisle for several minutes, unplugged his pallet jack, and demanded he delete video that had been posted to Snapchat. US Foods reviewed surveillance footage the next morning, characterized the entire episode as workplace violence, and terminated both Carreon and Torres.
Carreon filed a ten-count complaint including sexual harassment, discrimination, retaliation, wrongful termination, and several intentional tort claims. US Foods moved for summary adjudication, and the trial court granted the motion on all claims except sexual harassment and failure to prevent sexual harassment. Those two claims went to a jury trial in September 2022. The jury found for Carreon, awarding $200,000 in emotional distress damages and $1 million in punitive damages. US Foods then moved for judgment notwithstanding the verdict on punitive damages and for a new trial based on alleged instructional error regarding the last chance agreement's release. The court denied the new trial motion but granted JNOV on punitive damages, striking the $1 million award. Carreon sought roughly $1.3 million in attorney fees; the court awarded approximately $350,000.
The Court of Appeal affirmed in full in the unpublished case of Carreon v. U.S. Foodservice - B326837 consolidated with B327540, B330590 (March 2026) -upholding the summary adjudication, the jury instructions, the striking of punitive damages, and the attorney fee award.
The court held that US Foods carried its burden of showing a legitimate, nondiscriminatory reason for terminating Carreon: violation of its zero-tolerance workplace violence policy. The burden then shifted to Carreon to show pretext, but the court found he offered only his subjective belief that he was not violent, without evidence tying the termination decision to discriminatory or retaliatory motive. The court distinguished cases like *Sandell v. Taylor-Listug, Inc.* (2010) 188 Cal.App.4th 297 and *Kelly v. Stamps.com Inc.* (2005) 135 Cal.App.4th 1088, where plaintiffs presented substantial evidence undermining their employers' stated reasons. On the whistleblower retaliation claim, the court applied the framework from *Lawson v. PPG Architectural Finishes, Inc.* (2022) 12 Cal.5th 703 and found Carreon failed to show his complaints were a contributing factor in his termination. The tort claims were barred by workers' compensation exclusivity because US Foods promptly suspended and fired Torres, negating any ratification theory.
The court found no reversible error in instructing the jury that it could consider pre-release conduct when evaluating whether a reasonable person would find the work environment hostile. Citing *Lyle v. Warner Brothers Television Productions* (2006) 38 Cal.4th 264, the court reasoned that prior events provided relevant context for the post-release harassment, and the jury had already found that harassing conduct occurred after the release date before reaching the disputed question.
The court affirmed the JNOV, concluding there was no substantial evidence that any US Foods employee involved in the termination decision qualified as a "managing agent" under *White v. Ultramar, Inc.* (1999) 21 Cal.4th 563 and *Roby v. McKesson Corp.* (2009) 47 Cal.4th 686. Even as to those who might qualify, there was no clear and convincing evidence of malice, oppression, or fraud — only, at most, poor judgment.
The court found no abuse of discretion. The trial court properly set lead counsel's rate at $750 per hour based on recent comparable awards, then applied a 40% reduction supported by detailed findings about limited success, block billing, duplicative work, and improper billing for clerical tasks. The denial of a fee multiplier was within the court's discretion under *Ketchum v. Moses* (2001) 24 Cal.4th 1122, which does not mandate enhancement even in contingency-fee FEHA cases.
- Medicare Advantage Overpayments Inflate Premiums for Allon March 11, 2026 at 2:19 PM
Medicare Advantage (MA) overpayments are driving up Part B premiums for *all Medicare beneficiaries — including those who remain in Traditional Medicare (TM) and receive none of MA's supplemental benefits. The Joint Economic Committee estimates this cost enrollees an extra $13.4 billion in 2025, with cumulative excess premiums of **$82 billion since 2016**.
How the Mechanism Works
By law, the standard Part B premium covers roughly 25% of expected Part B spending per aged enrollee. Because MA plans are paid an estimated 120% of what it would cost to cover the same beneficiaries under TM (per the Medicare Payment Advisory Commission), MA overpayments flow directly into higher Part B expenditures — and therefore higher premiums for everyone. The premium does not distinguish between MA and TM enrollees, so TM beneficiaries subsidize the higher MA spending without receiving MA benefits.
The math is straightforward: $84 billion in MA overpayments × 60.6% attributable to Part B × 26.4% financed by premiums = **$13.4 billion** in excess premiums, or roughly **$212 per enrollee** in 2025.
Who Bears the Burden
Approximately 84.9% of the excess premium burden falls on individuals — most commonly as a direct reduction in take-home Social Security benefits, since about 70% of Part B enrollees have premiums withheld from their Social Security checks. Federal taxpayers absorb 9.1% and state taxpayers 6.0%, primarily through Medicaid premium subsidies for low-income enrollees.
TM beneficiaries bore roughly $6 billion of the $13.4 billion total in 2025. The geographic impact is uneven: states with low MA enrollment (e.g., Wyoming at 21% MA penetration) see TM beneficiaries paying as much as $770 in excess premiums per MA enrollee in the state, while high-MA states like Minnesota (65% MA penetration) see only $114 — a nearly 7:1 disparity.
The Outlook and Policy Implications
Per-person Part B expenditures are projected to nearly double by 2035, from approximately $9,100 to over $18,000. All contributing factors — Part B's share of total Medicare spending, the premium financing rate, and MA enrollment — are trending upward. If MA continues to be paid at 120% of TM, the per-beneficiary excess premium burden is projected to grow to roughly $450 per year by 2035.
The JEC brief concludes that aligning MA payment levels with TM would directly curb this avoidable premium growth. Gradual reform achieving payment parity could save each senior an estimated $2,600 over the next decade, while protecting net Social Security benefits for 50 million Part B beneficiaries.
- DWC Posts Proposal to Update ADA Accommodation Regulationson March 10, 2026 at 1:29 PM
The Division of Workers’ Compensation (DWC) has posted draft regulations regarding Americans with Disabilities Act (ADA) Accommodation to the online forum where members of the public may review and comment on the proposals. The draft regulations include renumbering of prior regulations along with additions and deletions of some language in those sections, and new sections 9004, 9008 and 9009 as follows:
A process for requests of blanket offers of accommodation for multiple remote appearances at the Workers’ Compensation Appeals Board (WCAB). New Rule: 9004 Blanket Offers of Accommodation for Remote Appearances in Division of Workers’ Compensation Hearings
(a) The Statewide Disability Coordinator can review requests for multiple remote appearances from parties of adjudication cases in division hearings. Disability accommodation requests for remote appearances in DWC hearings should only be made to accommodate disability. There is a separate process under Subchapter 2 of the Workers’ Compensation Appeals Board Rules of Practice and Procedure to request remote appearances for non-disability related reasons like being out of the geographical area.
(b) Requests for remote trial appearances should be made with at least 14 days advance notice to the local disability coordinator so that remote appearance(s) can be coordinated.
(c) For multiple remote appearance requests on the same day, requests submitted under adjudication pursuant to Rule 10816 as administrative accommodations should not provide an unfair advantage in adjudication.
(d) Remote appearances must be effective for all interested parties. Requestors must obtain written approval and provide notice to all interested parties for the remote appearance, including the adjudication officer or workers’ compensation administrative law judge at least 10 days before the appearance.
(e) In general, requests for specific remote appearances on blanket offers should be made with as much notice as possible. If the request is made less than five days before the date it is needed for a remote trial appearance, the requestor should be prepared to send another representative to attend the trial in-person. (f) Blanket offers can be revoked by the statewide disability coordinator
A new form to file a complaint of disability discrimination. DWC Form 9008 can be used to file a grievance of discrimination on the basis of disability by the division. The Administrative Director will respond in writing to the grievance within 35 days. New Rule 9008: Grievance Procedure
DIR DWC Form 9008. This grievance procedure may be used to file a complaint alleging discrimination on the basis of disability in the provision of services, activities, programs, or benefits by the Division of Workers’ Compensation.
The complaint should be in writing and contain information about the alleged discrimination such as name, mailing address, phone number, email address of complainant and location, date, and description of the problem. Alternative means of filing complaints, such as personal interviews or a tape recording of the complaint will be made available for a person with disabilities upon request. The complaint should be submitted as soon as possible, preferably within 60 calendar days of the alleged violation to the Statewide Disability Coordinator.
The Administrative Director will respond in writing to the grievance within 35 business days of receipt of the grievance. The response will explain the division’s position and offer options for resolution of the complaint. If the response does not resolve the issue, the complainant may appeal the decision within 15 calendar days after receipt of the response to the Administrative Director (AD) or designee. The AD or designee will respond in writing, and, where appropriate, in a format that is accessible to the complainant, with a final resolution of the complaint.
Investigations of ineffective accommodations. Litigants that have been affected by courtroom accommodations such as multiple continuances or remote appearances can use the grievance procedure to request an investigation into whether granted accommodations were ineffective. New Rule 9009: Ineffective Accommodations
(a) Complaints that granted accommodations were ineffective can be made to the Statewide Disability Coordinator by anyone involved in the accommodation process or affected by requests for accommodation.
(b) The Statewide Disability Coordintor will investigate all complaints of ineffective accommodations. The Statewide Disability Coordinator will discuss possible resolutions of the complaint and will determine a final resolution of the complaint.
The forum can be found online on the DWC forums web page under “current forums.” Comments will be accepted on the forum until 5 p.m. March 20.
- DOI, Consumer Watchdog and State Farm Reach Settlementon March 10, 2026 at 1:29 PM
The California Department of Insurance, Consumer Watchdog, and State Farm General Insurance Company reached a three-party settlement agreement in the full rate hearing proceeding that is underway to review State Farm’s emergency rate request. The agreement will provide financial relief to many policyholders while ensuring continued coverage for State Farm policyholders while California’s insurance market stabilizes.
This settlement agreement, now set to be reviewed by an impartial Administrative Law Judge, follows months of public review and negotiation called for by the Insurance Commissioner under California’s voter-approved Proposition 103 rate hearing process. The settlement reflects the Department’s responsibility to carefully review insurance rates and ensure they are justified, transparent, and fair for California consumers.
When he called for the hearing on March 14, 2025, Insurance Commissioner Ricardo Lara stated: “To resolve this matter, I am ordering State Farm to respond to questions in an official hearing, promoting transparency and a path forward.” This proceeding called for by Commissioner Lara required State Farm to provide detailed financial information and testimony regarding its rate request and financial condition, after the Eaton and Palisades fires in Los Angeles, as part of the public review process prescribed under Prop 103.
Under California’s rate hearing regulations, the Insurance Commissioner is separated from the negotiation and any details of the evidentiary proceeding while it is underway in order to preserve an impartial and fact-based process.
Since that time, the rate hearing proceeding — including at least nine public appearances and advocacy before the Administrative Law Judge regarding multiple discovery motions and disputed evidentiary issues between the parties, as well as status and scheduling conferences, and also including three formal and multiple informal settlement conferences between the parties — has been conducted with participation from experts from the California Department of Insurance and representatives from Consumer Watchdog and State Farm.
Under the settlement agreement reached between the California Department of Insurance, State Farm, and Consumer Watchdog, the Commissioner’s prior order granting State Farm’s request for an emergency interim rate increase has been confirmed with the following modifications:
- - Homeowners (non-tenant) policies: The interim rate of +17.0% will remain in place, meaning there will be no additional impact to policyholders beyond the currently approved interim rate.
- - Rental dwelling policies: The previously approved interim rate of +38% will be reduced to +32.8%, resulting in a rate refund for affected policyholders with 10% interested back to June 1, 2025 .
- - Condominium policies: Rates will be reduced from 15.0% to approximately +5.8%, which means policyholders will receive refunds and 10% interest back to June 1, 2025.
- - Renters insurance policies: The renters subline will see a slight increase to approximately +15.65% from a currently approved interim rate of 15.0%.
- - Refunds with interest: Consumers whose rates were reduced will also receive refunds with 10% interest retroactive to June 1, 2025.
In addition, the agreement includes an extension of the current moratorium on homeowners, rental dwelling, condominium, and renters non-renewals and cancellations for at least one additional year, providing continued stability for affected policyholders while the Department continues its broader efforts to stabilize California’s insurance market under its Sustainable Insurance Strategy.
Under California’s administrative rate hearing procedures, the parties have now submitted the three-party settlement agreement and supporting documentation to the Administrative Law Judge for review.
Settlement Process Timeline
- - March 6, 2026: Parties file the settlement agreement with the Administrative Law Judge.
- - March 20, 2026: Supporting declarations to be filed with the Administrative Law Judge.
- - April 7, 2026 (estimated): Proposed independent decision issued by the Administrative Law Judge if no additional evidence is requested.
- - Following the proposed decision, Insurance Commissioner Ricardo Lara will review the proposed decision and make a final decision.
- - At a later date, Consumer Watchdog may submit a request for intervenor compensation for its participation in the rate review and settlement process, as authorized under Prop. 103. If approved, the compensation amount – to be paid by State Farm policyholders – will be determined through a separate review process. Learn more about the intervenor compensation process at the Department’s website.
Separately, the California Department of Insurance continues its market conduct examination of State Farm General, which is reviewing the company’s claims handling practices and compliance with California law. Results from that examination are expected later this spring.
- Man To Serve 7 Years for Threatening to Kill Orange County Judgeon March 9, 2026 at 11:04 AM
A former Orange County resident was sentenced to 84 months in federal prison for threatening to kill a superior court judge who had presided over his family law case.
Byrom Zuniga Sanchez, 34, formerly of Laguna Niguel, but whose most recent residence was in Mexico, was sentenced by United States District Judge Fred W. Slaughter to seven years (87 months) in federal prison, exceeding the prosecution's request of six years, citing the grim nature of the threats, Sanchez's lack of contrition, and concerns the threats would continue. He was also ordered to pay approximately $22,798 in restitution.
Sanchez was arrested in San Diego in February 2024 after attempting to cross the border into the United States. He represented himself at the three-day trial in December 2025. The jury deliberated for about an hour before convicting him on two counts of threats by interstate and foreign communication. Sanchez has been in federal custody since February 2024.
Orange County Superior Court Judge Sandy Leal presided over Sanchez's custody case in 2021. After losing that case, Sanchez moved to Mexico and began targeting the judge.From May 2023 to July 2023, Sanchez sent multiple death threats via email to the victim Judge. Sanchez also threatened to kill or harm others, including other court employees, lawyers, and law enforcement officials.
For example, in July 2023, Sanchez emailed the victim Judge’s former courtroom, “I am more committed to murdering you than I am to being present as a father.” In the same email, Sanchez also wrote, “You’re already dead. The remainder of my life will be dedicated to assassinating judges, attorneys, and a police station’s entire shift staff.”
Sanchez also sent the judge a music video by rapper Ashnikko, and he posted a threatening video on October 5, 2023. His threats had real consequences: Orange County sheriff's deputies had to set up a command center and increase patrols at the Lamoreaux Justice Center on October 13, 2023, and some court employees stayed home out of fear. Judge Leal, however, testified that she didn't want one person to derail the administration of justice and came to work that day.
“[Sanchez’s] terrifying embrace of his offenses – his delight at the pain of others – and his total lack of remorse increases the already substantial need for specific deterrence,” prosecutors argued in a sentencing memorandum.
The FBI investigated this matter. Assistant United States Attorneys Alexandra Sloan Kelly of the Transnational Organized Crime Section and Diane B. Roldán of the Major Crimes Section prosecuted this case.
- Insurance Carriers May Face Private Credit Meltdown Riskon March 9, 2026 at 11:04 AM
The term "private credit meltdown" refers to escalating fears of a potential crisis in the private credit market - a sector where non-bank lenders (like investment funds, asset managers, and private equity firms) provide loans directly to companies. This market has ballooned in size and popularity since the 2008 financial crisis, but recent high-profile collapses, rising defaults, and economic pressures have sparked warnings of a broader unwind that could echo the subprime mortgage meltdown. While some experts view it as an imminent threat, others argue the risks are contained and not systemic.
The private credit market has grown dramatically: From about $400 billion in 2008 to roughly $2 trillion globally by early 2026. It's projected to reach $4.9 trillion by 2029. A significant portion (around 40%) is concentrated in software and tech firms, which are seen as innovative but volatile.
Insurance companies face notable risks from the ongoing turmoil in the private credit market, though the level of jeopardy varies by region, firm, and exposure. Insurers have become major players in private credit, allocating billions to these higher-yield assets to boost returns on policyholder premiums. However, with rising defaults, valuation drops, and AI-driven disruptions in key sectors like software (where ~40% of private credit loans are concentrated), this exposure could lead to significant losses, liquidity strains, or even solvency issues in a worst-case scenario. Critics warn it might spark a broader crisis, echoing 2008's shadow banking woes, but many executives and regulators argue the risks are contained.
Post-2008 regulations pushed banks away from risky lending, creating opportunities for non-banks like insurers. North American life insurers now hold about 35% of their portfolios in private credit, up sharply from pre-crisis levels. Globally, insurers manage trillions in these assets, often through partnerships with private equity firms that own or manage insurance arms. For example, firms like Apollo and Blue Owl (which froze redemptions recently) have deep ties to insurance, with policyholder funds funneled into private loans.
Based on recent analyses and reports from early 2026, several U.S. life insurance companies, particularly those acquired or heavily influenced by private equity (PE) firms, are flagged as being in potential jeopardy. This stems from their significant allocations to private credit - often through related-party investments - which expose them to risks like credit losses, liquidity strains, interest rate shifts, regulatory tightening, and opacity in asset valuations. These firms represent a subset of the broader industry, where PE ownership has led to higher-risk portfolios to chase yields. Not all insurers are equally affected; traditional players like AXA or Allianz have lower exposures and have publicly downplayed risks. The following list focuses on those specifically highlighted in market discussions and research.
- - Athene (owned by Apollo Global Management): Holds 12-18% of assets in related-party investments tied to private credit. Vulnerable to worsening credit cycles, potential spikes in defaults (especially in AI-disrupted sectors like software), and increased capital charges from regulators like the NAIC. Despite strong capital ($34 billion), a downturn could erode buffers and trigger liquidity issues.
- - Global Atlantic (owned by KKR): Approximately 22% of assets in related-party private credit investments. At risk of capital shortfalls if private credit assets face stress, such as rising defaults or reduced liquidity amid economic turbulence. The firm's reinsurance strategies and PE ties amplify concerns over transparency and contagion.
- - Everlake (formerly Allstate Life Insurance, owned by Blackstone): High exposure with 35% of assets in related-party investments. Jeopardy arises from potential credit losses, interest rate volatility, and stricter regulations, which could force asset sales or capital raises in a stressed market.
- - American National Insurance (owned by Brookfield): Around 30% of assets linked to related-party private credit. Risks include opacity in holdings, illiquidity during downturns, and broader market contagion, potentially leading to solvency pressures if defaults rise.
These companies are often cited in warnings from investors like Steve Eisman and analysts at firms like Fitch and Moody's, who point to a "slow-brewing scandal" in the life insurance sector due to offshore reinsurance and imbalanced asset-liability structures.
However, executives at these firms emphasize managed risks through diversification and stress testing. Broader industry outlooks remain neutral, but a recession or AI-driven disruptions could exacerbate issues. This is not yet a systemic crisis. Default rates remain contained, and the largest private credit platforms emphasize that their portfolios are performing. But the opacity that once shielded private credit from market volatility is now working against it, delaying the recognition of problems and compressing the time available to respond.
- New CMS TEAM Model May Enhance Workers' Comp Treatmenton March 5, 2026 at 9:03 AM
On January 1, 2026, the Centers for Medicare & Medicaid Services launched the Transforming Episode Accountability Model (TEAM) - a mandatory, five-year program that requires approximately 740 acute care hospitals to take financial responsibility for the entire episode of a patient's surgical care, from the operating room through 30 days post-discharge. While this is a Medicare regulation, its effects are already influencing how orthopedic injuries are treated across all payer types, including workers' compensation.
Three of the five surgical categories covered by TEAM are directly relevant to workplace injuries: lower extremity joint replacement (hip, knee, and ankle), surgical hip and femur fracture treatment, and spinal fusion. For each episode, CMS sets a risk-adjusted target price. Hospitals that come in under budget while meeting quality benchmarks earn bonuses; those that exceed the target owe money back. Unlike earlier voluntary bundled-payment experiments, there is no opt-out.
Outpatient joint replacement is becoming the norm. Same-day discharge for total hip and knee replacement is now routine for appropriately selected patients. Outpatient orthopedic volume was already 33 times higher than inpatient volume by late 2023, and TEAM's episode-based pricing further incentivizes hospitals to move procedures to ambulatory surgery centers and send patients home the same day. Advances in regional anesthesia, minimally invasive techniques, and "prehabilitation" protocols have made this clinically safe for many patients.
Post-surgical rehabilitation is being compressed. Hospitals are now accountable for all costs in the 30-day post-discharge window - physical therapy, home health, imaging, and ER visits. Physical therapy often begins within hours of surgery, and remote monitoring and telehealth follow-ups are replacing some in-person visits.
Patient-reported outcomes now affect reimbursement. TEAM ties hospital payment to a Composite Quality Score that includes readmission rates, complications, and - notably - patient-reported outcome measures (PROMs). The patient's own assessment of pain, function, and satisfaction directly affects the hospital's bottom line.
Faster timelines will become the expectation. As same-day joint replacement becomes standard of care, carriers and utilization reviewers will increasingly expect injured workers to follow accelerated protocols. Defense counsel should recognize that same-day discharge now reflects mainstream practice - not corner-cutting. Claimant's counsel should watch for cases where comorbidities or job demands make an accelerated timeline inappropriate.
Financial incentives may influence treatment decisions. TEAM creates pressure to reduce episode costs. While this often aligns with good care, attorneys should be alert to situations where cost-reduction incentives conflict with a worker's needs - premature discharge, inadequate post-op rehab, or limited follow-up visits within the 30-day window.
Patient-reported outcome data may become discoverable. Hospitals are now collecting standardized, quantitative data on how patients perceive their own recovery before and after surgery. This data could become relevant in disputes over disability extent, surgical success, or maximum medical improvement.
Reimbursement pressures may affect provider availability. CMS simultaneously applied a −2.5% efficiency adjustment to orthopedic surgical work RVUs in 2026, on top of roughly 20% cumulative RVU reductions for hip and knee arthroplasty over the past decade. As Medicare margins tighten, some surgeons may become more selective about which payers they accept — potentially affecting the availability of specialists willing to treat comp patients.
CMS has stated its goal of placing 100% of Medicare recipients under alternative payment models by 2030. The trends TEAM is accelerating - outpatient surgery, compressed rehabilitation, data-driven outcome tracking, and cost-conscious episode management - will increasingly define how workplace musculoskeletal injuries are treated regardless of the payer. Practitioners should understand these dynamics now, because they will soon shape the medical evidence, treatment timelines, and expert opinions in your cases.
Keep in mind that the TEAM model applies to Medicare; workers' compensation systems are governed by state law and may differ in their treatment and reimbursement frameworks.
- Good Forensic Mesothelioma Evidence Leads to $50 M Verdicton March 5, 2026 at 9:03 AM
Rita-Ann Chapman began using Avon talcum powder products in 1954 at the age of eight, continuing multiple times per week until 1978, and then again from 1995 to 2010. She was eventually diagnosed with mesothelioma, a disease caused by asbestos exposure. The Chapmans sued dozens of defendants; by the time of trial, only Avon and Hyster-Yale Group, Inc. remained in the case. Mrs. Chapman died on March 16, 2025, and Gary Chapman continued the case as her successor-in-interest.
At trial, the Chapmans presented extensive evidence that Avon's talc products contained asbestos. Internal Avon memos from the early 1970s acknowledged asbestos contamination - some showing tremolite asbestos levels as high as 20–25 percent in certain talc sources. The Chapmans' expert, Dr. William Longo, tested vintage Avon products and found chrysotile asbestos using a refined sample preparation method originally developed at the Colorado School of Mines in 1973. Their medical expert, Dr. Steven Haber, opined to a reasonable degree of medical certainty that Mrs. Chapman's decades of Avon talc use was a substantial factor in causing her mesothelioma. A biostatistics expert, Dr. David Madigan, testified that Mrs. Chapman's odds of avoiding asbestos exposure across all the Italian-sourced talc products she used were astronomically low.
Avon countered with its own testing showing no asbestos and with expert testimony suggesting that many mesotheliomas are spontaneous or genetic, and that women's mesothelioma rates had remained relatively flat regardless of asbestos usage trends.
The jury found Avon strictly liable for selling products with inadequate warnings and with manufacturing and design defects. It also found Avon liable for negligence, fraudulent misrepresentation, and fraudulent concealment, and determined that Avon acted with malice, oppression, or fraud. The jury awarded $40,831,453 in compensatory damages and $10.3 million in punitive damages, apportioning 90 percent fault to Avon.
The Court of Appeal, Second District, Division Eight, affirmed the judgment in full in the published case of Chapman v. Avon Products, Inc.- Case Nos. B327749 & B330345 (March 2026)
Avon raised four claims of error on appeal: that the trial court improperly admitted Dr. Longo's chrysotile testing testimony, improperly excluded corporate witness Lisa Gallo, improperly allowed Dr. Haber to testify on asbestos testing methods and Avon's internal documents, and that insufficient evidence supported the verdict.
On Dr. Longo's testimony, the court found that Avon had expressly conceded at trial that its challenge was based on reliability under the Sargon standard rather than novelty under Kelly, thereby waiving any Kelly challenge. See Sargon Enterprises, Inc. v. University of Southern California (2012) 55 Cal.4th 747 and People v. Kelly (1976) 17 Cal.3d 24. The trial court properly exercised its gatekeeping role and reasonably concluded that Dr. Longo's methods - which combined an established 1973 sample preparation technique with longstanding PLM analysis - were not clearly invalid or unreliable.
On Lisa Gallo's exclusion, the court found no abuse of discretion. Avon listed Gallo only as a corporate representative and never disclosed her as a witness with personal knowledge of relevant facts, as required by Code of Civil Procedure section 2016.090, subdivision (a)(1)(A). Gallo herself had denied in deposition testimony that she worked with Avon's talc products, and most of the testimony Avon proposed she give concerned events predating her 1994 employment. The court also rejected Avon's misconduct argument regarding plaintiffs' "corporate silence" closing argument, finding it was fair comment on the evidence. See LAOSD Asbestos Cases (2023) 87 Cal.App.5th 939.
On Dr. Haber's testimony, the court held that his extensive qualifications in occupational and environmental medicine - including decades of assessing environmental causes of pulmonary disease - provided a sufficient foundation for interpreting asbestos testing methods and Avon's internal documents. Avon had failed to object to his qualification as an expert and forfeited several specific challenges by not raising them under proper headings or with timely objections. See United Grand Corp. v. Malibu Hillbillies, LLC (2019) 36 Cal.App.5th 142.
On sufficiency of the evidence, the court found Avon waived this claim entirely by failing to set forth all material evidence - both favorable and unfavorable - as required under established appellate standards. Avon's brief cherry-picked testimony favorable to its position while largely ignoring its own damaging 1970s memos and the Chapmans' extensive expert testimony. See Foreman & Clark Corp. v. Fallon (1971) 3 Cal.3d 875; Huong Que, Inc. v. Luu (2007) 150 Cal.App.4th 400.
- Owners of SoCal Towing Companies Arrested for $6M Comp Fraudon March 12, 2026 at 11:25 AM
Brothers and tow company owners, Mark Hassan, 46, of Corona Del Mar, and Ahmed Hassan, 35 of Walnut, were arrested on multiple counts of felony insurance fraud after allegedly underreporting employee payroll and paying portions of employees’ wages in cash to defraud workers’ compensation insurance companies out of nearly 6 million dollars of insurance premiums.
The California Department of Insurance launched an investigation after receiving two fraud referrals from an insurance company alleging that Mark Hassan, owner of Hadley Tow, underreported his company’s payroll. The Department’s investigation expanded when it received a third fraud referral alleging his brother Ahmed Hassan, owner of California Heights Tow, filed a fraudulent employee injury claim against his insurance policy for a Hadley Tow employee.
Mark Hassen, also the owner of FMG Inc., was doing business as Hadley Tow based in Whittier, Courtesy Tow based in Sylmar, Crescenta Valley Tow based in La Crescenta, California Coach Towing based in Walnut, and several other tow companies across the greater Los Angeles area. He also held towing contracts with multiple law enforcement agencies throughout Southern California.
During the investigation, detectives learned Mark Hassan used his uninsured tow company, Courtesy Tow, as a “shell company” to conceal portions of Hadley Tow employee payroll to allegedly defraud workers’ compensation carriers of premiums they were owed. Ahmed Hassan, in an attempt to lower his company’s workers’ compensation insurance premiums also underreported employee wages.
In addition to hiding and misrepresenting employee wages to their workers’ compensation insurance providers, the Hassan brothers paid portions or all of employee wages without withholding standard deductions, which led to Employment Development Department opening a payroll tax evasion investigation.
For both Hadley Tow and California Heights Tow the brothers reported a combined payroll of $3,038,164 to their insurance carriers, but a forensic audit revealed the actual combined payroll for the two companies was $16,716,657. The illegal actions resulted in an estimated premium loss of $5,897,487.
Underreporting of workers' compensation insurance in California is illegal and undermines the financial stability of the insurance system, which shifts costs onto other policyholders. It also jeopardizes the availability of benefits for injured workers, hindering their access to necessary support. Unfair competition also arises as fraudulent businesses gain an advantage over ethical ones. Experts at the Department of Insurance are dedicated to protecting consumers by rigorously investigating cases of alleged illegal acts by insurance companies and individuals.
Mark Hassan was booked at the Los Angeles County Sheriff - Inmate Reception Center, and Ahmed Hassan was booked at the West Valley Detention Center in Rancho Cucamonga. This case is being prosecuted by the Los Angeles District Attorney’s Office. - The Quiet Knee Protocol - Less Is More After Surgeryon March 12, 2026 at 11:25 AM
Knee replacement surgery is one of the most common procedures that the workers' compensation industry encounter in serious injury claims. When a warehouse worker blows out a knee, or a construction laborer's joint finally gives way after years of wear, total knee arthroplasty (TKA) often becomes the endgame of treatment. What happens after that surgery - the recovery timeline, the pain management, the return-to-work prognosis — matters enormously in evaluating and resolving these claims.
A recent development out of the nation's top-ranked orthopedic hospital may change the way clinicians approach post-surgical knee replacement recovery, with direct implications for workers' compensation practice.
In October 2025, researchers at Hospital for Special Surgery (HSS) in New York — ranked number one in orthopedics by U.S. News & World Report for sixteen consecutive years - presented results of a retrospective study on a recovery approach they call the "Quiet Knee" protocol". The findings were shared at the annual meeting of the American Association of Hip and Knee Surgeons (AAHKS).
The traditional approach to knee replacement recovery has long emphasized early, aggressive physical therapy - bending, walking, and pushing through pain as quickly as possible. The "no pain, no gain" mentality has been standard guidance for decades. The Quiet Knee protocol challenges that orthodoxy. Instead of aggressive early mobilization, the protocol focuses on controlling inflammation and swelling during the first ten days after surgery through restricted mobility, gentle passive range of motion, and intensive icing (cryotherapy). Structured telerehabilitation replaces the usual push toward immediate in-person physical therapy.
The rationale is physiological. According to the HSS researchers, overly aggressive early therapy can trigger a counterproductive cycle: the more a patient bends and walks in the first days after surgery, the more the knee swells, which increases pain, which limits the range of motion the therapy was supposed to restore. The Quiet Knee approach respects the body's inflammatory response and gives the surgical tissue time to begin healing before progressive rehabilitation starts.
The HSS study reviewed all of their total knee replacement patients from 2020 through 2024, comparing a cohort of 271 patients who followed the structured Quiet Knee protocol against groups that received either verbal guidance alone or traditional early-motion therapy. Early results suggest that patients following the protocol experienced a smoother recovery trajectory. Notably, the protocol was associated with a reduction in 90-day opioid exposure of more than 25 percent.
Why this matters: This protocol is likely to appear with increasing frequency in treatment plans and IME reports involving post-TKA recovery. The study gives institutional support to a conservative, rest-first rehabilitation approach - and the opioid reduction finding adds a significant data point to disputes involving post-operative pain management. Practitioners handling knee injury claims on either side should be aware of it. - Court Strikes $1M Worker's Punitive Damages for Lack of Evidenceon March 11, 2026 at 2:19 PM
Hector Carreon worked as an order selector at U.S. Foodservice's La Mirada distribution facility. He alleged a pattern of sexual harassment at the warehouse, including a 2018 incident where a coworker tried to grab his genitals and made threatening remarks, and repeated threats from coworker Jesus Torres to sexually assault him in the freezer. Carreon claimed he reported these incidents to managers and his union representative, but was met with indifference or dismissive comments.
In July 2019, after being reinstated from an earlier termination through a union grievance, Carreon signed a "last chance agreement" that released US Foods from liability for all prior employment claims. About a month later, on August 29, 2019, Torres physically confronted Carreon in the frozen foods warehouse — pulling him off his pallet jack, throwing him onto shelves, and repeatedly thrusting his groin toward Carreon's face while coworkers watched and filmed. Afterward, Carreon followed Torres around the aisle for several minutes, unplugged his pallet jack, and demanded he delete video that had been posted to Snapchat. US Foods reviewed surveillance footage the next morning, characterized the entire episode as workplace violence, and terminated both Carreon and Torres.
Carreon filed a ten-count complaint including sexual harassment, discrimination, retaliation, wrongful termination, and several intentional tort claims. US Foods moved for summary adjudication, and the trial court granted the motion on all claims except sexual harassment and failure to prevent sexual harassment. Those two claims went to a jury trial in September 2022. The jury found for Carreon, awarding $200,000 in emotional distress damages and $1 million in punitive damages. US Foods then moved for judgment notwithstanding the verdict on punitive damages and for a new trial based on alleged instructional error regarding the last chance agreement's release. The court denied the new trial motion but granted JNOV on punitive damages, striking the $1 million award. Carreon sought roughly $1.3 million in attorney fees; the court awarded approximately $350,000.
The Court of Appeal affirmed in full in the unpublished case of Carreon v. U.S. Foodservice - B326837 consolidated with B327540, B330590 (March 2026) -upholding the summary adjudication, the jury instructions, the striking of punitive damages, and the attorney fee award.
The court held that US Foods carried its burden of showing a legitimate, nondiscriminatory reason for terminating Carreon: violation of its zero-tolerance workplace violence policy. The burden then shifted to Carreon to show pretext, but the court found he offered only his subjective belief that he was not violent, without evidence tying the termination decision to discriminatory or retaliatory motive. The court distinguished cases like *Sandell v. Taylor-Listug, Inc.* (2010) 188 Cal.App.4th 297 and *Kelly v. Stamps.com Inc.* (2005) 135 Cal.App.4th 1088, where plaintiffs presented substantial evidence undermining their employers' stated reasons. On the whistleblower retaliation claim, the court applied the framework from *Lawson v. PPG Architectural Finishes, Inc.* (2022) 12 Cal.5th 703 and found Carreon failed to show his complaints were a contributing factor in his termination. The tort claims were barred by workers' compensation exclusivity because US Foods promptly suspended and fired Torres, negating any ratification theory.
The court found no reversible error in instructing the jury that it could consider pre-release conduct when evaluating whether a reasonable person would find the work environment hostile. Citing *Lyle v. Warner Brothers Television Productions* (2006) 38 Cal.4th 264, the court reasoned that prior events provided relevant context for the post-release harassment, and the jury had already found that harassing conduct occurred after the release date before reaching the disputed question.
The court affirmed the JNOV, concluding there was no substantial evidence that any US Foods employee involved in the termination decision qualified as a "managing agent" under *White v. Ultramar, Inc.* (1999) 21 Cal.4th 563 and *Roby v. McKesson Corp.* (2009) 47 Cal.4th 686. Even as to those who might qualify, there was no clear and convincing evidence of malice, oppression, or fraud — only, at most, poor judgment.
The court found no abuse of discretion. The trial court properly set lead counsel's rate at $750 per hour based on recent comparable awards, then applied a 40% reduction supported by detailed findings about limited success, block billing, duplicative work, and improper billing for clerical tasks. The denial of a fee multiplier was within the court's discretion under *Ketchum v. Moses* (2001) 24 Cal.4th 1122, which does not mandate enhancement even in contingency-fee FEHA cases. - Medicare Advantage Overpayments Inflate Premiums for Allon March 11, 2026 at 2:19 PM
Medicare Advantage (MA) overpayments are driving up Part B premiums for *all Medicare beneficiaries — including those who remain in Traditional Medicare (TM) and receive none of MA's supplemental benefits. The Joint Economic Committee estimates this cost enrollees an extra $13.4 billion in 2025, with cumulative excess premiums of **$82 billion since 2016**.
How the Mechanism Works
By law, the standard Part B premium covers roughly 25% of expected Part B spending per aged enrollee. Because MA plans are paid an estimated 120% of what it would cost to cover the same beneficiaries under TM (per the Medicare Payment Advisory Commission), MA overpayments flow directly into higher Part B expenditures — and therefore higher premiums for everyone. The premium does not distinguish between MA and TM enrollees, so TM beneficiaries subsidize the higher MA spending without receiving MA benefits.
The math is straightforward: $84 billion in MA overpayments × 60.6% attributable to Part B × 26.4% financed by premiums = **$13.4 billion** in excess premiums, or roughly **$212 per enrollee** in 2025.
Who Bears the Burden
Approximately 84.9% of the excess premium burden falls on individuals — most commonly as a direct reduction in take-home Social Security benefits, since about 70% of Part B enrollees have premiums withheld from their Social Security checks. Federal taxpayers absorb 9.1% and state taxpayers 6.0%, primarily through Medicaid premium subsidies for low-income enrollees.
TM beneficiaries bore roughly $6 billion of the $13.4 billion total in 2025. The geographic impact is uneven: states with low MA enrollment (e.g., Wyoming at 21% MA penetration) see TM beneficiaries paying as much as $770 in excess premiums per MA enrollee in the state, while high-MA states like Minnesota (65% MA penetration) see only $114 — a nearly 7:1 disparity.
The Outlook and Policy Implications
Per-person Part B expenditures are projected to nearly double by 2035, from approximately $9,100 to over $18,000. All contributing factors — Part B's share of total Medicare spending, the premium financing rate, and MA enrollment — are trending upward. If MA continues to be paid at 120% of TM, the per-beneficiary excess premium burden is projected to grow to roughly $450 per year by 2035.
The JEC brief concludes that aligning MA payment levels with TM would directly curb this avoidable premium growth. Gradual reform achieving payment parity could save each senior an estimated $2,600 over the next decade, while protecting net Social Security benefits for 50 million Part B beneficiaries. - DWC Posts Proposal to Update ADA Accommodation Regulationson March 10, 2026 at 1:29 PM
The Division of Workers’ Compensation (DWC) has posted draft regulations regarding Americans with Disabilities Act (ADA) Accommodation to the online forum where members of the public may review and comment on the proposals. The draft regulations include renumbering of prior regulations along with additions and deletions of some language in those sections, and new sections 9004, 9008 and 9009 as follows:
A process for requests of blanket offers of accommodation for multiple remote appearances at the Workers’ Compensation Appeals Board (WCAB). New Rule: 9004 Blanket Offers of Accommodation for Remote Appearances in Division of Workers’ Compensation Hearings
(a) The Statewide Disability Coordinator can review requests for multiple remote appearances from parties of adjudication cases in division hearings. Disability accommodation requests for remote appearances in DWC hearings should only be made to accommodate disability. There is a separate process under Subchapter 2 of the Workers’ Compensation Appeals Board Rules of Practice and Procedure to request remote appearances for non-disability related reasons like being out of the geographical area.
(b) Requests for remote trial appearances should be made with at least 14 days advance notice to the local disability coordinator so that remote appearance(s) can be coordinated.
(c) For multiple remote appearance requests on the same day, requests submitted under adjudication pursuant to Rule 10816 as administrative accommodations should not provide an unfair advantage in adjudication.
(d) Remote appearances must be effective for all interested parties. Requestors must obtain written approval and provide notice to all interested parties for the remote appearance, including the adjudication officer or workers’ compensation administrative law judge at least 10 days before the appearance.
(e) In general, requests for specific remote appearances on blanket offers should be made with as much notice as possible. If the request is made less than five days before the date it is needed for a remote trial appearance, the requestor should be prepared to send another representative to attend the trial in-person. (f) Blanket offers can be revoked by the statewide disability coordinator
A new form to file a complaint of disability discrimination. DWC Form 9008 can be used to file a grievance of discrimination on the basis of disability by the division. The Administrative Director will respond in writing to the grievance within 35 days. New Rule 9008: Grievance Procedure
DIR DWC Form 9008. This grievance procedure may be used to file a complaint alleging discrimination on the basis of disability in the provision of services, activities, programs, or benefits by the Division of Workers’ Compensation.
The complaint should be in writing and contain information about the alleged discrimination such as name, mailing address, phone number, email address of complainant and location, date, and description of the problem. Alternative means of filing complaints, such as personal interviews or a tape recording of the complaint will be made available for a person with disabilities upon request. The complaint should be submitted as soon as possible, preferably within 60 calendar days of the alleged violation to the Statewide Disability Coordinator.
The Administrative Director will respond in writing to the grievance within 35 business days of receipt of the grievance. The response will explain the division’s position and offer options for resolution of the complaint. If the response does not resolve the issue, the complainant may appeal the decision within 15 calendar days after receipt of the response to the Administrative Director (AD) or designee. The AD or designee will respond in writing, and, where appropriate, in a format that is accessible to the complainant, with a final resolution of the complaint.
Investigations of ineffective accommodations. Litigants that have been affected by courtroom accommodations such as multiple continuances or remote appearances can use the grievance procedure to request an investigation into whether granted accommodations were ineffective. New Rule 9009: Ineffective Accommodations
(a) Complaints that granted accommodations were ineffective can be made to the Statewide Disability Coordinator by anyone involved in the accommodation process or affected by requests for accommodation.
(b) The Statewide Disability Coordintor will investigate all complaints of ineffective accommodations. The Statewide Disability Coordinator will discuss possible resolutions of the complaint and will determine a final resolution of the complaint.
The forum can be found online on the DWC forums web page under “current forums.” Comments will be accepted on the forum until 5 p.m. March 20. - DOI, Consumer Watchdog and State Farm Reach Settlementon March 10, 2026 at 1:29 PM
The California Department of Insurance, Consumer Watchdog, and State Farm General Insurance Company reached a three-party settlement agreement in the full rate hearing proceeding that is underway to review State Farm’s emergency rate request. The agreement will provide financial relief to many policyholders while ensuring continued coverage for State Farm policyholders while California’s insurance market stabilizes.
This settlement agreement, now set to be reviewed by an impartial Administrative Law Judge, follows months of public review and negotiation called for by the Insurance Commissioner under California’s voter-approved Proposition 103 rate hearing process. The settlement reflects the Department’s responsibility to carefully review insurance rates and ensure they are justified, transparent, and fair for California consumers.
When he called for the hearing on March 14, 2025, Insurance Commissioner Ricardo Lara stated: “To resolve this matter, I am ordering State Farm to respond to questions in an official hearing, promoting transparency and a path forward.” This proceeding called for by Commissioner Lara required State Farm to provide detailed financial information and testimony regarding its rate request and financial condition, after the Eaton and Palisades fires in Los Angeles, as part of the public review process prescribed under Prop 103.
Under California’s rate hearing regulations, the Insurance Commissioner is separated from the negotiation and any details of the evidentiary proceeding while it is underway in order to preserve an impartial and fact-based process.
Since that time, the rate hearing proceeding — including at least nine public appearances and advocacy before the Administrative Law Judge regarding multiple discovery motions and disputed evidentiary issues between the parties, as well as status and scheduling conferences, and also including three formal and multiple informal settlement conferences between the parties — has been conducted with participation from experts from the California Department of Insurance and representatives from Consumer Watchdog and State Farm.
Under the settlement agreement reached between the California Department of Insurance, State Farm, and Consumer Watchdog, the Commissioner’s prior order granting State Farm’s request for an emergency interim rate increase has been confirmed with the following modifications:
- - Homeowners (non-tenant) policies: The interim rate of +17.0% will remain in place, meaning there will be no additional impact to policyholders beyond the currently approved interim rate.
- - Rental dwelling policies: The previously approved interim rate of +38% will be reduced to +32.8%, resulting in a rate refund for affected policyholders with 10% interested back to June 1, 2025 .
- - Condominium policies: Rates will be reduced from 15.0% to approximately +5.8%, which means policyholders will receive refunds and 10% interest back to June 1, 2025.
- - Renters insurance policies: The renters subline will see a slight increase to approximately +15.65% from a currently approved interim rate of 15.0%.
- - Refunds with interest: Consumers whose rates were reduced will also receive refunds with 10% interest retroactive to June 1, 2025.
In addition, the agreement includes an extension of the current moratorium on homeowners, rental dwelling, condominium, and renters non-renewals and cancellations for at least one additional year, providing continued stability for affected policyholders while the Department continues its broader efforts to stabilize California’s insurance market under its Sustainable Insurance Strategy.
Under California’s administrative rate hearing procedures, the parties have now submitted the three-party settlement agreement and supporting documentation to the Administrative Law Judge for review.
Settlement Process Timeline
- - March 6, 2026: Parties file the settlement agreement with the Administrative Law Judge.
- - March 20, 2026: Supporting declarations to be filed with the Administrative Law Judge.
- - April 7, 2026 (estimated): Proposed independent decision issued by the Administrative Law Judge if no additional evidence is requested.
- - Following the proposed decision, Insurance Commissioner Ricardo Lara will review the proposed decision and make a final decision.
- - At a later date, Consumer Watchdog may submit a request for intervenor compensation for its participation in the rate review and settlement process, as authorized under Prop. 103. If approved, the compensation amount – to be paid by State Farm policyholders – will be determined through a separate review process. Learn more about the intervenor compensation process at the Department’s website.
Separately, the California Department of Insurance continues its market conduct examination of State Farm General, which is reviewing the company’s claims handling practices and compliance with California law. Results from that examination are expected later this spring. - Man To Serve 7 Years for Threatening to Kill Orange County Judgeon March 9, 2026 at 11:04 AM
A former Orange County resident was sentenced to 84 months in federal prison for threatening to kill a superior court judge who had presided over his family law case.
Byrom Zuniga Sanchez, 34, formerly of Laguna Niguel, but whose most recent residence was in Mexico, was sentenced by United States District Judge Fred W. Slaughter to seven years (87 months) in federal prison, exceeding the prosecution's request of six years, citing the grim nature of the threats, Sanchez's lack of contrition, and concerns the threats would continue. He was also ordered to pay approximately $22,798 in restitution.
Sanchez was arrested in San Diego in February 2024 after attempting to cross the border into the United States. He represented himself at the three-day trial in December 2025. The jury deliberated for about an hour before convicting him on two counts of threats by interstate and foreign communication. Sanchez has been in federal custody since February 2024.
Orange County Superior Court Judge Sandy Leal presided over Sanchez's custody case in 2021. After losing that case, Sanchez moved to Mexico and began targeting the judge.From May 2023 to July 2023, Sanchez sent multiple death threats via email to the victim Judge. Sanchez also threatened to kill or harm others, including other court employees, lawyers, and law enforcement officials.
For example, in July 2023, Sanchez emailed the victim Judge’s former courtroom, “I am more committed to murdering you than I am to being present as a father.” In the same email, Sanchez also wrote, “You’re already dead. The remainder of my life will be dedicated to assassinating judges, attorneys, and a police station’s entire shift staff.”
Sanchez also sent the judge a music video by rapper Ashnikko, and he posted a threatening video on October 5, 2023. His threats had real consequences: Orange County sheriff's deputies had to set up a command center and increase patrols at the Lamoreaux Justice Center on October 13, 2023, and some court employees stayed home out of fear. Judge Leal, however, testified that she didn't want one person to derail the administration of justice and came to work that day.
“[Sanchez’s] terrifying embrace of his offenses – his delight at the pain of others – and his total lack of remorse increases the already substantial need for specific deterrence,” prosecutors argued in a sentencing memorandum.
The FBI investigated this matter. Assistant United States Attorneys Alexandra Sloan Kelly of the Transnational Organized Crime Section and Diane B. Roldán of the Major Crimes Section prosecuted this case. - Insurance Carriers May Face Private Credit Meltdown Riskon March 9, 2026 at 11:04 AM
The term "private credit meltdown" refers to escalating fears of a potential crisis in the private credit market - a sector where non-bank lenders (like investment funds, asset managers, and private equity firms) provide loans directly to companies. This market has ballooned in size and popularity since the 2008 financial crisis, but recent high-profile collapses, rising defaults, and economic pressures have sparked warnings of a broader unwind that could echo the subprime mortgage meltdown. While some experts view it as an imminent threat, others argue the risks are contained and not systemic.
The private credit market has grown dramatically: From about $400 billion in 2008 to roughly $2 trillion globally by early 2026. It's projected to reach $4.9 trillion by 2029. A significant portion (around 40%) is concentrated in software and tech firms, which are seen as innovative but volatile.
Insurance companies face notable risks from the ongoing turmoil in the private credit market, though the level of jeopardy varies by region, firm, and exposure. Insurers have become major players in private credit, allocating billions to these higher-yield assets to boost returns on policyholder premiums. However, with rising defaults, valuation drops, and AI-driven disruptions in key sectors like software (where ~40% of private credit loans are concentrated), this exposure could lead to significant losses, liquidity strains, or even solvency issues in a worst-case scenario. Critics warn it might spark a broader crisis, echoing 2008's shadow banking woes, but many executives and regulators argue the risks are contained.
Post-2008 regulations pushed banks away from risky lending, creating opportunities for non-banks like insurers. North American life insurers now hold about 35% of their portfolios in private credit, up sharply from pre-crisis levels. Globally, insurers manage trillions in these assets, often through partnerships with private equity firms that own or manage insurance arms. For example, firms like Apollo and Blue Owl (which froze redemptions recently) have deep ties to insurance, with policyholder funds funneled into private loans.
Based on recent analyses and reports from early 2026, several U.S. life insurance companies, particularly those acquired or heavily influenced by private equity (PE) firms, are flagged as being in potential jeopardy. This stems from their significant allocations to private credit - often through related-party investments - which expose them to risks like credit losses, liquidity strains, interest rate shifts, regulatory tightening, and opacity in asset valuations. These firms represent a subset of the broader industry, where PE ownership has led to higher-risk portfolios to chase yields. Not all insurers are equally affected; traditional players like AXA or Allianz have lower exposures and have publicly downplayed risks. The following list focuses on those specifically highlighted in market discussions and research.
- - Athene (owned by Apollo Global Management): Holds 12-18% of assets in related-party investments tied to private credit. Vulnerable to worsening credit cycles, potential spikes in defaults (especially in AI-disrupted sectors like software), and increased capital charges from regulators like the NAIC. Despite strong capital ($34 billion), a downturn could erode buffers and trigger liquidity issues.
- - Global Atlantic (owned by KKR): Approximately 22% of assets in related-party private credit investments. At risk of capital shortfalls if private credit assets face stress, such as rising defaults or reduced liquidity amid economic turbulence. The firm's reinsurance strategies and PE ties amplify concerns over transparency and contagion.
- - Everlake (formerly Allstate Life Insurance, owned by Blackstone): High exposure with 35% of assets in related-party investments. Jeopardy arises from potential credit losses, interest rate volatility, and stricter regulations, which could force asset sales or capital raises in a stressed market.
- - American National Insurance (owned by Brookfield): Around 30% of assets linked to related-party private credit. Risks include opacity in holdings, illiquidity during downturns, and broader market contagion, potentially leading to solvency pressures if defaults rise.
These companies are often cited in warnings from investors like Steve Eisman and analysts at firms like Fitch and Moody's, who point to a "slow-brewing scandal" in the life insurance sector due to offshore reinsurance and imbalanced asset-liability structures.
However, executives at these firms emphasize managed risks through diversification and stress testing. Broader industry outlooks remain neutral, but a recession or AI-driven disruptions could exacerbate issues. This is not yet a systemic crisis. Default rates remain contained, and the largest private credit platforms emphasize that their portfolios are performing. But the opacity that once shielded private credit from market volatility is now working against it, delaying the recognition of problems and compressing the time available to respond. - New CMS TEAM Model May Enhance Workers' Comp Treatmenton March 5, 2026 at 9:03 AM
On January 1, 2026, the Centers for Medicare & Medicaid Services launched the Transforming Episode Accountability Model (TEAM) - a mandatory, five-year program that requires approximately 740 acute care hospitals to take financial responsibility for the entire episode of a patient's surgical care, from the operating room through 30 days post-discharge. While this is a Medicare regulation, its effects are already influencing how orthopedic injuries are treated across all payer types, including workers' compensation.
Three of the five surgical categories covered by TEAM are directly relevant to workplace injuries: lower extremity joint replacement (hip, knee, and ankle), surgical hip and femur fracture treatment, and spinal fusion. For each episode, CMS sets a risk-adjusted target price. Hospitals that come in under budget while meeting quality benchmarks earn bonuses; those that exceed the target owe money back. Unlike earlier voluntary bundled-payment experiments, there is no opt-out.
Outpatient joint replacement is becoming the norm. Same-day discharge for total hip and knee replacement is now routine for appropriately selected patients. Outpatient orthopedic volume was already 33 times higher than inpatient volume by late 2023, and TEAM's episode-based pricing further incentivizes hospitals to move procedures to ambulatory surgery centers and send patients home the same day. Advances in regional anesthesia, minimally invasive techniques, and "prehabilitation" protocols have made this clinically safe for many patients.
Post-surgical rehabilitation is being compressed. Hospitals are now accountable for all costs in the 30-day post-discharge window - physical therapy, home health, imaging, and ER visits. Physical therapy often begins within hours of surgery, and remote monitoring and telehealth follow-ups are replacing some in-person visits.
Patient-reported outcomes now affect reimbursement. TEAM ties hospital payment to a Composite Quality Score that includes readmission rates, complications, and - notably - patient-reported outcome measures (PROMs). The patient's own assessment of pain, function, and satisfaction directly affects the hospital's bottom line.
Faster timelines will become the expectation. As same-day joint replacement becomes standard of care, carriers and utilization reviewers will increasingly expect injured workers to follow accelerated protocols. Defense counsel should recognize that same-day discharge now reflects mainstream practice - not corner-cutting. Claimant's counsel should watch for cases where comorbidities or job demands make an accelerated timeline inappropriate.
Financial incentives may influence treatment decisions. TEAM creates pressure to reduce episode costs. While this often aligns with good care, attorneys should be alert to situations where cost-reduction incentives conflict with a worker's needs - premature discharge, inadequate post-op rehab, or limited follow-up visits within the 30-day window.
Patient-reported outcome data may become discoverable. Hospitals are now collecting standardized, quantitative data on how patients perceive their own recovery before and after surgery. This data could become relevant in disputes over disability extent, surgical success, or maximum medical improvement.
Reimbursement pressures may affect provider availability. CMS simultaneously applied a −2.5% efficiency adjustment to orthopedic surgical work RVUs in 2026, on top of roughly 20% cumulative RVU reductions for hip and knee arthroplasty over the past decade. As Medicare margins tighten, some surgeons may become more selective about which payers they accept — potentially affecting the availability of specialists willing to treat comp patients.
CMS has stated its goal of placing 100% of Medicare recipients under alternative payment models by 2030. The trends TEAM is accelerating - outpatient surgery, compressed rehabilitation, data-driven outcome tracking, and cost-conscious episode management - will increasingly define how workplace musculoskeletal injuries are treated regardless of the payer. Practitioners should understand these dynamics now, because they will soon shape the medical evidence, treatment timelines, and expert opinions in your cases.
Keep in mind that the TEAM model applies to Medicare; workers' compensation systems are governed by state law and may differ in their treatment and reimbursement frameworks. - Good Forensic Mesothelioma Evidence Leads to $50 M Verdicton March 5, 2026 at 9:03 AM
Rita-Ann Chapman began using Avon talcum powder products in 1954 at the age of eight, continuing multiple times per week until 1978, and then again from 1995 to 2010. She was eventually diagnosed with mesothelioma, a disease caused by asbestos exposure. The Chapmans sued dozens of defendants; by the time of trial, only Avon and Hyster-Yale Group, Inc. remained in the case. Mrs. Chapman died on March 16, 2025, and Gary Chapman continued the case as her successor-in-interest.
At trial, the Chapmans presented extensive evidence that Avon's talc products contained asbestos. Internal Avon memos from the early 1970s acknowledged asbestos contamination - some showing tremolite asbestos levels as high as 20–25 percent in certain talc sources. The Chapmans' expert, Dr. William Longo, tested vintage Avon products and found chrysotile asbestos using a refined sample preparation method originally developed at the Colorado School of Mines in 1973. Their medical expert, Dr. Steven Haber, opined to a reasonable degree of medical certainty that Mrs. Chapman's decades of Avon talc use was a substantial factor in causing her mesothelioma. A biostatistics expert, Dr. David Madigan, testified that Mrs. Chapman's odds of avoiding asbestos exposure across all the Italian-sourced talc products she used were astronomically low.
Avon countered with its own testing showing no asbestos and with expert testimony suggesting that many mesotheliomas are spontaneous or genetic, and that women's mesothelioma rates had remained relatively flat regardless of asbestos usage trends.
The jury found Avon strictly liable for selling products with inadequate warnings and with manufacturing and design defects. It also found Avon liable for negligence, fraudulent misrepresentation, and fraudulent concealment, and determined that Avon acted with malice, oppression, or fraud. The jury awarded $40,831,453 in compensatory damages and $10.3 million in punitive damages, apportioning 90 percent fault to Avon.
The Court of Appeal, Second District, Division Eight, affirmed the judgment in full in the published case of Chapman v. Avon Products, Inc.- Case Nos. B327749 & B330345 (March 2026)
Avon raised four claims of error on appeal: that the trial court improperly admitted Dr. Longo's chrysotile testing testimony, improperly excluded corporate witness Lisa Gallo, improperly allowed Dr. Haber to testify on asbestos testing methods and Avon's internal documents, and that insufficient evidence supported the verdict.
On Dr. Longo's testimony, the court found that Avon had expressly conceded at trial that its challenge was based on reliability under the Sargon standard rather than novelty under Kelly, thereby waiving any Kelly challenge. See Sargon Enterprises, Inc. v. University of Southern California (2012) 55 Cal.4th 747 and People v. Kelly (1976) 17 Cal.3d 24. The trial court properly exercised its gatekeeping role and reasonably concluded that Dr. Longo's methods - which combined an established 1973 sample preparation technique with longstanding PLM analysis - were not clearly invalid or unreliable.
On Lisa Gallo's exclusion, the court found no abuse of discretion. Avon listed Gallo only as a corporate representative and never disclosed her as a witness with personal knowledge of relevant facts, as required by Code of Civil Procedure section 2016.090, subdivision (a)(1)(A). Gallo herself had denied in deposition testimony that she worked with Avon's talc products, and most of the testimony Avon proposed she give concerned events predating her 1994 employment. The court also rejected Avon's misconduct argument regarding plaintiffs' "corporate silence" closing argument, finding it was fair comment on the evidence. See LAOSD Asbestos Cases (2023) 87 Cal.App.5th 939.
On Dr. Haber's testimony, the court held that his extensive qualifications in occupational and environmental medicine - including decades of assessing environmental causes of pulmonary disease - provided a sufficient foundation for interpreting asbestos testing methods and Avon's internal documents. Avon had failed to object to his qualification as an expert and forfeited several specific challenges by not raising them under proper headings or with timely objections. See United Grand Corp. v. Malibu Hillbillies, LLC (2019) 36 Cal.App.5th 142.
On sufficiency of the evidence, the court found Avon waived this claim entirely by failing to set forth all material evidence - both favorable and unfavorable - as required under established appellate standards. Avon's brief cherry-picked testimony favorable to its position while largely ignoring its own damaging 1970s memos and the Chapmans' extensive expert testimony. See Foreman & Clark Corp. v. Fallon (1971) 3 Cal.3d 875; Huong Que, Inc. v. Luu (2007) 150 Cal.App.4th 400.