- Court Must Decide if Federal or State Arbitration Law Applieson June 11, 2026 at 4:42 PM
Rebecca Orr worked briefly for United Parcel Service, Inc. ("UPS") as a Seasonal Support Driver in late 2023, picking up packages from other UPS drivers and delivering them to their final destinations during the holiday rush. When she applied, she signed an "Arbitration Agreement/Seasonal Hiring Agreement" through an online portal. The agreement was drafted to be "as broad as legally permissible" and contained four provisions that mattered to her case: a Delegation Clause giving the arbitrator exclusive authority over disputes about the agreement's validity and enforceability; a Class Action Waiver; a PAGA Individual Action Requirement Clause; and a "How This Agreement Applies" section declaring the contract governed by the Federal Arbitration Act ("FAA") — unless the FAA "does not apply to a particular dispute or to one or both parties."
Orr's experience on the job was rocky. Although UPS told her she would work eight-hour days, six days a week, her routes were shortened or canceled the morning of a scheduled shift on at least seven occasions. After a December route cancellation, she contacted HR and was told there were not enough packages to deliver. She received no further assignments despite repeated requests for work.
Orr sued UPS in the Superior Court of California for the County of Riverside, raising five state-law claims (including a claim that UPS failed to pay drivers their required "reporting time pay") on behalf of three putative classes, later adding a sixth claim under California's Private Attorneys General Act ("PAGA"). UPS removed the case to federal court and moved to compel arbitration and stay proceedings.
A central dispute emerged: Orr and UPS disagreed over whether the FAA or the California Arbitration Act ("CAA") governed the agreement. The distinction was not merely academic — the two statutes differ in ways that could change which of Orr's claims could be heard in court versus arbitration.
The district court granted UPS's motion. It ordered Orr to arbitrate her individual claims "consistent with the terms of the binding arbitration agreement," while staying litigation of the class claims pending arbitration. Critically, the court declined to decide whether the FAA or CAA applied, reasoning that the "result is the same" under either statute, so the question need not be resolved. It also concluded that Orr had forfeited any challenge to the Delegation Clause.
Orr moved for clarification under Federal Rule of Civil Procedure 60(a) and (b), arguing the court itself had to decide whether her contract fell within the FAA's exemption for certain employment contracts (9 U.S.C. § 1). The district court denied the motion, holding it had "properly refrained" from determining whether a Section 1 exemption applied because, in its view, the CAA does not require that analysis before compelling arbitration.
Because neither the FAA nor California law allows an ordinary appeal from an order granting arbitration, Orr sought a writ of mandamus from the Ninth Circuit.
This was a mandamus proceeding, not a conventional appeal, so the Ninth Circuit did not "affirm" or "reverse." Instead, the panel granted Orr's petition for a writ of mandamus and directed the district court to determine the appropriate statutory basis for its authority to compel arbitration in the published case of In re Rebecca Orr, No. 25-2330 (9th Cir. June 9, 2026). The court made clear it was not ordering that arbitration is improper — only that the legal basis for it must be decided first, with the remaining arbitrability issues left to the district court to address afterward.
The panel evaluated the five factors governing mandamus relief from Bauman v. U.S. District Court, 557 F.2d 650, 654–55 (9th Cir. 1977): (1) the absence of another adequate remedy such as direct appeal; (2) prejudice not correctable on appeal; (3) clear legal error by the district court; (4) an oft-repeated error or persistent disregard of the rules; and (5) a new and important problem or issue of first impression. The third factor — clear error — is a necessary condition, so the court began there.
Clear legal error (Factor 3). The court held the district court clearly erred by compelling arbitration without identifying the source of its authority, thereby improperly handing the FAA § 1 exemption question to the arbitrator. Under New Prime Inc. v. Oliveira, 586 U.S. 105, 111 (2019), a court — not an arbitrator — must decide whether the § 1 "contracts of employment" exclusion applies before ordering arbitration under the FAA, because a court's power to compel arbitration is bounded, not "unconditional."
Two features made the error especially clear here. First, the agreement's own choice-of-law clause assumed the FAA would control unless found inapplicable, making the FAA question a contractual prerequisite. Second, the choice of governing law was not a mere technicality: under Perry v. Thomas, 482 U.S. 483, 490–91 (1987), the FAA preempts California Labor Code § 229 (which lets employees pursue unpaid-wage claims in court despite an arbitration agreement), but California courts allow such suits when only the CAA applies, Garrido v. Air Liquide Industries U.S. LP, 241 Cal. App. 4th 833, 845 (2015).
The panel rejected UPS's argument that New Prime does not apply where state law offers an alternative basis for arbitration, noting that no federal court of appeals has allowed a district court to skip the § 1 question simply because a state statute might also compel arbitration. It pointed to its own precedents Romero v. Watkins & Shepard Trucking, Inc., 9 F.4th 1097, 1100 (9th Cir. 2021), and In re Van Dusen, 654 F.3d 838, 846 (9th Cir. 2011), as well as decisions from sister circuits, including Harper v. Amazon.com Services, Inc., 12 F.4th 287, 296 (3d Cir. 2021), and Cunningham v. Lyft, Inc., 17 F.4th 244, 253 (1st Cir. 2021).
With the first three factors — including the critical clear-error factor — strongly favoring relief, the panel granted the writ.
- CVS Resolves Insulin Pen Overbilling Medi-Cal Case for $36.5Mon June 11, 2026 at 4:42 PM
The California Attorney General in collaboration with the United States Department of Justice, announced a settlement with national pharmacy chain CVS Pharmacy, Inc. (CVS) over its submissions of false claims to the Medi-Cal program for excessive dispensing of insulin pens.
The settlement resolves allegations that between January 2010 and December 2020, CVS broke the law by submitting fraudulent claims to Medi-Cal, intentionally giving patients more insulin than prescribed and lying about refill timelines to get paid for unauthorized, unnecessary medication.
The settlement agreement requires CVS to pay $36.5 million total with California’s share being over $2.7 million.
Insulin pens (hard plastic, pen-shaped cases containing syringes filled with insulin solution) are a common way for diabetic patients to self-administer insulin. During the relevant period, manufacturers frequently distributed insulin pens in five-pen cartons with each pen containing 300 units (3 mL) of insulin solution. Insulin prescriptions must set forth the “directions for use,” which typically designate both how much insulin to administer and the frequency and/or timing of when to administer it.
When pharmacies seek reimbursement from Group Health Plans (GHPs) for insulin pens, they are required to report, among other data, the “quantity dispensed” and the “days-of-supply.” The “quantity dispensed” means the total amount of medication dispensed to a patient when the pharmacy fills the prescription, and the “days-of-supply” refers to the number of days that the quantity dispensed is expected to last if taken as directed by the prescriber. Typically, pharmacists calculate days-of-supply by dividing the total quantity of medication dispensed by the patient’s “daily dose,” i.e., the amount of medication that the prescriber directs the patient to use each day.
GHP plans, and pharmacy benefit managers (“PBMs”) working on their behalf, typically set limits on the days-of-supply that a pharmacy may dispense when filling prescriptions (such as a 30-day supply), and reject reimbursement claims for fills that exceed those limits. GHPs and PBMs also deny reimbursement for prematurely refilled prescriptions—refills dispensed before the beneficiary would have consumed a substantial portion of the previously-dispensed quantity of medication if taken as prescribed. PBMs use automated processes to review claims for reimbursement submitted by pharmacies and deny claims that are submitted too far in advance of the expected refill date. The ability of PBMs to detect and reject reimbursement claims for premature refills depends on pharmacies complying with their obligations to accurately report days-of-supply data.
Dispensing insulin in full cartons containing five pens can exceed applicable days-of-supply limits, resulting in claim rejections. PBMs developed rules to address reimbursement when dispensing medications like insulin in the smallest commercially-available container would exceed the days-of-supply limit. Some PBMs required pharmacies to seek an override of the limit and then to resubmit the claim reporting the accurate days-of-supply actually dispensed so the PBM could verify when the next refill would be needed. Other PBMs permitted pharmacies to submit claims reporting the maximum days-of-supply allowed, even if that number was lower than the actual supply dispensed. Importantly, however, those PBMs still required pharmacies to track and use the actual days-of-supply dispensed to determine when patients would actually need a refill. All PBMs prohibited pharmacies from seeking reimbursement for premature refills, regardless of container size.
As alleged in the Government’s Complaint: From January 1, 2010, through December 31, 2020 (the “Covered Period”), CVS violated the FCA by knowingly submitting, or causing to be submitted, false claims to GHPs for reimbursement for insulin pens where CVS: dispensed more insulin to GHP beneficiaries than was specified by their prescriptions and refilled GHP beneficiary prescriptions substantially before GHP beneficiaries needed the refills; falsely under-reported the days-of-supply for the insulin refills, which often prevented PBMs from detecting that the refills were premature; and failed to comply with applicable rules when refilling insulin prescriptions requiring pharmacies to calculate refill dates using the actual days-of-supply dispensed.
To fill insulin prescriptions as quickly as possible and to ensure that reimbursement claims for insulin pens were not rejected, CVS instructed its pharmacy staff simply to report the maximum days-of-supply allowed under the beneficiary’s plan when dispensing full insulin pen cartons, which was often lower than the actual days-of-supply dispensed. Many CVS pharmacies did not internally document and use the actual days-of-supply dispensed to determine when patients could next refill their prescription. To the contrary, CVS’ dispensing software calculated refill dates automatically based on inaccurate days-of-supply data reported to the PBM. As a result, CVS pharmacy staff repeatedly refilled prescriptions prematurely, dispensing substantially more insulin to GHP beneficiaries than they actually needed and substantially sooner than they needed it according to their prescriptions. As a result, some GHP beneficiaries accumulated large quantities of unused insulin, which was both wasteful and potentially dangerous as insulin can expire.
CVS management was well aware that it was over-dispensing insulin. PBMs conducted periodic audits of CVS pharmacies and repeatedly found violations of the dispensing rules, including reporting invalid days-of-supply data, refilling insulin pen prescriptions too soon, and dispensing insulin pens in excess of the quantities authorized by the prescription. PBMs issued chargebacks to CVS based on these violations. For several years, CVS management knew that insulin pens were among the drug products most frequently subject to chargebacks for premature refills. Yet, despite these audit findings, CVS failed to take necessary steps to address this long-standing problem during the Covered Period.
Under the settlement, CVS admitted, among other things, that:
- - During much of the covered period, many CVS pharmacies did not break open insulin pen cartons when dispensing insulin pens. As a result, at times, CVS pharmacies dispensed amounts of insulin that exceeded applicable days-of-supply limits. When a claim for reimbursement was rejected for exceeding the limit, some CVS pharmacies did not obtain overrides and re-submit the claim listing the actual days-of-supply dispensed as required by some PBMs. Instead, CVS pharmacies often reported the maximum days-of-supply allowed under the beneficiary’s insurance plan for insulin pens when resubmitting the claim, which was lower than the actual days-of-supply dispensed. While certain PBMs allowed this practice because the carton was the smallest commercially-available container for the medication, CVS pharmacies at times did not adhere to the appropriate refill intervals for patients that were to be based on the actual days-of-supply dispensed.
- - During much of the covered period, CVS customers with insulin-pen prescriptions who enrolled in CVS’ optional auto-refill program received automatic prompts notifying them that their refilled prescriptions were available to be picked up. CVS’ auto-refill logic calculated prescription refill dates based on the days-of-supply data recorded by pharmacy staff and sent customers refill notifications based on those dates. When pharmacy staff recorded days-of-supply numbers that were lower than the actual days-of-supply dispensed, the system would at times calculate refill dates for patients that were premature. As a result, some CVS pharmacies dispensed insulin pen refills to GHP beneficiaries before the beneficiaries needed more insulin and before the GHP plan or PBM would have approved such refills for reimbursement.
- - At times during the covered period, GHPs and the payors working on their behalf paid CVS substantial amounts for insulin pen refills that were ineligible for reimbursement, and CVS pharmacies dispensed more insulin to GHP beneficiaries than they needed.
In connection with the filing of the lawsuit and settlement, the Government joined five private whistleblower lawsuits that had previously been filed under seal pursuant to the False Claims Act.
- DOJ Declares EEOC's Disparate-Impact Guidelines Unconstitutionalon June 10, 2026 at 1:56 PM
The Justice Department's Office of Legal Counsel (OLC) issued an opinion on June 9 concluding that the Equal Employment Opportunity Commission's longstanding guidelines on disparate-impact liability under Title VII are unconstitutional. The opinion, signed by Assistant Attorney General T. Elliot Gaiser and Deputy Assistant Attorney General Joshua Craddock, asserts that the EEOC's approach pressures employers into race-based decision-making to avoid liability—and that, properly read, Title VII reaches only practices reflecting "a significant likelihood of intentional discrimination."
In an unusual move, DOJ announced the opinion jointly with the EEOC. OLC opinions are not court rulings, but they are treated as binding within the executive branch - meaning the EEOC and other agencies are now expected to enforce Title VII consistent with this reading.
Disparate-impact liability holds employers responsible for facially neutral practices that disproportionately burden a protected group, even absent discriminatory intent. Its origin is the Supreme Court's 1971 decision in Griggs v. Duke Power Co., which held that Title VII bars practices "fair in form, but discriminatory in operation" - in that case, a high-school-diploma requirement and an aptitude test that screened out Black applicants without being shown to predict job performance.
In 1978, the EEOC, DOL, DOJ, and the Civil Service Commission jointly adopted the Uniform Guidelines on Employee Selection Procedures (29 C.F.R. part 1607), which remain in force and require employers to "validate" any selection procedure producing an adverse impact. The Court refined the framework in Wards Cove Packing Co. v. Atonio (1989), tightening the plaintiff's burden to identify the specific practice causing a disparity. Congress responded in the Civil Rights Act of 1991, codifying the three-step burden-shifting test at 42 U.S.C. § 2000e-2(k): the plaintiff identifies a specific practice causing a disparity; the employer shows the practice is "job related" and "consistent with business necessity"; and the plaintiff may still prevail by identifying an equally effective, less-discriminatory alternative the employer refused to adopt.
Two later decisions - Ricci v. DeStefano (2009) and Texas Department of Housing v. Inclusive Communities (2015) - flagged the "serious constitutional questions" that arise if liability turns on statistical disparity alone, and emphasized that the doctrine needs limiting safeguards to avoid pushing employers toward quotas. Justice Scalia's Ricci concurrence, that the "war between disparate impact and equal protection" would eventually be waged, is quoted prominently in the new opinion.
Rather than declaring the 1991 statute itself void, OLC deploys constitutional avoidance to reinterpret Title VII narrowly and then finds specific EEOC regulations unlawful. It lays out three limiting principles:
- - 1) A low business-necessity bar. Employers need only show a challenged practice is "rational, convenient, or helpful" to a valid business purpose. Background checks, aptitude and knowledge tests, SAT scores, high-school-graduation requirements, and blind auditions are deemed presumptively job-related. Only "irrational or arbitrary" practices with no plausible job-relatedness can create liability.
- - 2) A robust causation requirement. Plaintiffs must show - at the pleading stage and beyond - that the specific challenged practice itself, not external factors, caused the disparity.
- - 3) A demanding alternative-practice requirement. Plaintiffs must identify a concrete alternative that is both less discriminatory and equally effective, including as to cost and other burdens.
Applying these principles, the opinion concludes that two parts of the EEOC's framework are independently unlawful: the validation-study requirements in the Uniform Guidelines (which it calls atextual, "labyrinthine," and improperly burden-shifting), and the Affirmative Action Guidelines (29 C.F.R. part 1608), which it says unconstitutionally encourage racial preferences without an established Title VII violation.
OLC frames the opinion as a response to the Supreme Court's June 2 per curiam decision in Allen v. Milligan and its companion Louisiana v. Callais, which reread Section 2 of the Voting Rights Act to impose liability "only when the circumstances give rise to a strong inference that intentional discrimination occurred." OLC imports that logic into Title VII.
The opinion is also the latest step in a sequence that began with President Trump's April 2025 Executive Order 14281, Restoring Equality of Opportunity and Meritocracy, directing agencies to eliminate disparate-impact enforcement. That was followed by the EEOC pausing disparate-impact investigations in 2025 and DOJ's December 2025 rule rescinding Title VI disparate-impact regulations. EEOC Chair Andrea Lucas, who formally requested the opinion in February, welcomed it as providing "clarity" on the constitutional limits of the doctrine; Acting Attorney General Todd Blanche said it would let businesses "hire based on performance."
Theoretical practical takeaways for employers and their counsel to consider at this early stage.
- - Enforcement posture has shifted, but the statute has not. The 1991 codification of disparate impact remains on the books, and courts - not OLC - decide what Title VII requires. Plaintiffs can still sue in federal court, and the private bar has signaled it will continue bringing disparate-impact claims regardless of EEOC inaction.
- - Expect agency charges to get harder to win. The EEOC is unlikely to pursue impact-only theories, and the validation and affirmative-action regulations are now treated as unenforceable within the agency.
- - Selection tools are on firmer footing - at the federal level. Tests, background checks, and similar screens face a lighter justification standard under this reading. But state and local fair-employment laws (and their own disparate-impact provisions) are unaffected and remain a live source of exposure.
- - DEI-style "voluntary affirmative action" carries fresh risk. The opinion's hostility to race-conscious "goals and timetables" reinforces the post-SFFA, post-Ames trend against preference programs.
Critics, including former Civil Rights Division attorneys, argue the opinion contradicts Supreme Court precedent and will lead to "a sharp increase in unchecked discrimination." Because an OLC opinion binds the executive branch but not the judiciary, the doctrine's ultimate fate will turn on litigation now likely to accelerate - and, eventually, on whether the Supreme Court takes up the question Justice Scalia flagged sixteen years ago.
NOTE: This summary is for informational purposes and is not legal advice. Employers should consult counsel about how these developments interact with applicable federal, state, and local law.
- S.F. Telehealth Company Resolves False Claims Case for $3.325Mon June 10, 2026 at 1:56 PM
San Francisco-based Circle Medical Care of California, Circle Medical Technologies, Inc., and their Chief Medical Officer and medical director Dr. Nicole Tsang, D.O., have agreed to pay a total of $3,325,000 to the United States and the State of California to settle allegations that they knowingly submitted claims for payments to federal healthcare programs and California commercial insurers for services by providers who did not actually provide or supervise those services, in violation of the federal False Claims Act and corresponding state statute.
Circle operates an online telehealth platform through which it offers mental health treatment and primary care medical services through contract providers, including nurse practitioners and physician assistants located throughout the country. Circle submits claims for payment to federally funded health programs, including Medicare, Medicaid, and TRICARE, and to California commercial insurers.
The United States and California allege that Circle submitted claims for payment to these programs and insurers for services, and received reimbursement, between January 1, 2018, and May 31, 2025, despite knowingly identifying the name and NPI (National Provider Identifier) number of rendering providers who did not actually provide or supervise the services rendered, and failed properly to supervise the nurse practitioners and physician assistants who rendered medical services to its patients during this period.
Under the settlement agreement, Circle will pay $475,000 to the United States and $2,850,000 to California.
United States Attorney Craig H. Missakian, Special Agent in Charge Robb R. Breeden of the U.S. Department of Health and Human Services Office of Inspector General (HHS OIG), and Assistant Inspector General and Health Care Fraud Division Director Jennifer K. Dietz of the Defense Health Agency Office of Inspector General (DHA-OIG) made the announcement.
The settlement resolves claims brought under the qui tam or whistleblower provisions of the False Claims Act by Jason Vellen. Under those provisions, a private party can file an action on behalf of the United States and receive a portion of any recovery. The qui tam case is captioned United States and State of California ex rel. Jason Vellen v. Circle Medical Care of California, Circle Medical Technologies, Inc., Dr. Nicole Tsang, D.O, and George Favvas, No. 3:24-cv-02024-TSH (N.D. Cal.). In connection with the settlement, Mr. Vellen will receive $80,750 from the United States and $997,500 from California.
Assistant U.S. Attorney Savith Iyengar handled this matter. The resolution resulted from a coordinated effort among the U.S. Attorney’s Office for the Northern District of California, the California Department of Insurance, and the San Francisco District Attorney’s Office.
The claims resolved by the settlement are allegations only, and there has been no determination of liability.
- CWCI Reports Private Self-Insured Claims Fall But Losses Riseon June 9, 2026 at 3:43 PM
Private self insurers are required to file Self Insurer's Annual Reports by March 1 each year. Each private Self Insurer's report is required to include paid, estimated future, and total incurred claims costs for each of the past five calendar years (claims reported from January 1 through December 31 for each year), as well as paid, estimated future, and total incurred claims costs for any claims still open from earlier reported years.
California private self-insured employers reported fewer workers’ compensation claims in 2025, driving private, self-insured claim frequency to a 5-year low, but initial data show signs of rising claim costs according to a new California Workers’ Compensation Institute (CWCI) analysis of first-report data from the state Office of Self-Insurance Plans (OSIP).
The latest data show private self-insured employers in California covered nearly 2.22 million employees in 2025, down 1.5% from the prior year. Despite the slight reduction in the covered workforce, private self-insured wages and salaries totaled nearly $152.5 billion, up 1.1% from the prior year. At the same time, the number of reported claims in the private self-insured sector fell for the third year in a row, declining 2.7% to 84,996 claims. That total is 18.5% below the 2022 peak, when thousands of COVID-19 cases pushed the private self-insured claim count up to 104,278.
Overall, private self-insured claim frequency edged down from 3.88 claims per 100 employees in 2024 to 3.83 claims per 100 employees last year, the lowest level since 2020. The Institute notes that both indemnity and medical-only claim frequency have fallen since the pandemic-era spike in COVID-related claims, with the decline in indemnity frequency contributing just slightly more to the overall reduction in private self-insured claim frequency.
Despite the declines in private self-insured claim volume and frequency, comparing the initial loss data from all 2024 and 2025 claims (medical-only and indemnity) show total paid losses remained essentially unchanged at $352.4 million. At the same time, total incurred losses (paid benefits plus reserves for future payments) rose 4.8% to $979.2 million, reflecting increases in expected claim costs, as the average incurred loss per claim increased 7.7% last year, driven largely by growth in medical reserves.
The Institute also found that both average paid and average incurred losses on private self-insured claims have been trending up for several years. Comparing first-report loss payments on all private self-insured claims from recent years, the Institute found that the average paid loss rose 2.5% to $4,147 in 2025, marking the third consecutive annual increase. Since bottoming out at $2,983 in 2022, the average paid loss has increased 39.0%. Meanwhile, the average incurred loss climbed to $11,520 last year, up 48.1% since 2022. Higher indemnity and medical losses both contributed to these increases, but rising medical losses have been the key cost driver, as the first report data from 2022 and 2025 show the average paid medical loss per claim increased 48.4% and the average incurred medical loss per claim increased 55.2%; so even with the 18.5% reduction in claim volume, total paid medical losses increased 20.9%; and total incurred medical losses increased 26.5%.
OSIP’s newly released data summary provides the first look at California private self-insured workers’ compensation experience for calendar year 2025 and includes updated experience for claims reported from 2021 through 2024. OSIP has posted its latest summary, along with those from the previous 24 years.
- Study Shows High Attrition Rate for Surgeons Nationwideon June 9, 2026 at 3:43 PM
Every workers' compensation claim involving a serious injury eventually runs into a question of access: Is there a surgeon available to operate, and how soon? Surgeon supply drives surgical wait times, which drive temporary disability duration, return-to-work timelines, and ultimately claim cost.
A new study "National Analysis of Trends and Factors Associated with Surgeon Attrition in the US" published in the Journal of the American College of Surgeons (2026, published ahead of print) is the largest national look to date at how surgeons are leaving active practice — and it gives a data-backed sense of where the supply pressure is, and is not, building.
The team of researchers tracked 224,629 surgeons across 19 surgical specialties using Medicare billing data from 2013 through 2023, following them for a median of 8 years. They defined "attrition" as a surgeon who stopped showing meaningful clinical activity (fewer than 50 evaluation-and-management services per year) for three straight years. They then used statistical modeling to identify which factors predicted leaving practice.
Nearly one in ten U.S. surgeons left active practice over eight years, but the loss is concentrated — heaviest among mid-career surgeons and a handful of specialties, lightest in the orthopedic and podiatric fields that drive most workers' comp surgical care. The supply picture is best understood specialty by specialty, not as a single national number.
- - Roughly 1 in 10 surgeons (9.7%) left active clinical practice over the 8-year window. That works out to about 15,753 surgeons.
- - Annual attrition held steady at 1.5–1.7% per year from 2013 to 2018, then spiked to 2.5% in 2019 before dropping to 1.3% in 2020. The authors attribute the spike largely to the early COVID-19 period.
- - If that rate holds, the authors project a loss of roughly 2,000 surgeons per year — about 25,000 to 30,000 over the next decade.
- - The workforce is aging: median years in practice nearly doubled from 7 (2013) to 16 (2023).
- - The share of women surgeons rose from 21% to 29%.
- - Rural surgical presence shrank — from about 10.5% of surgeons in rural/non-metro areas in 2013 to 8.5% in 2023.
The detail that matters most: it varies enormously by specialty. Attrition is not uniform — and for workers' compensation purposes, the differences cut in a reassuring direction for the specialties that are critical..
High-attrition specialties 5-Year Cumulative Attrition
- - Oral & Maxillofacial Surgery - 25.1%
- - Obstetrics & Gynecology - 23.2%
- - Plastic & Reconstructive Surgery - 19.3%
Low-attrition specialties 5-Year Cumulative Attrition
- - Otolaryngology (ENT) - 1.8%
- - Podiatry / Foot & Ankle - 1.8%
- - Orthopedic Surgery - 2.4%
- - Vascular Surgery - 3.1%
The specialties that handle the bulk of occupational injuries — orthopedic surgery, podiatry/foot-and-ankle, and to a lesser extent vascular and neurosurgery — show among the lowest attrition rates and the shallowest decline curves. Orthopedics in particular, the workhorse of musculoskeletal injury care, is a relatively stable specialty in this data. That's encouraging for surgical access on most lost-time claims.
The authors suggest the high-attrition specialties are pressured by heavy call burdens, malpractice exposure, market competition, and the availability of non-clinical career exits — while the more stable specialties tend to offer more predictable schedules and clearer paths to dialing back late-career rather than leaving outright.
One of the more surprising results: attrition does not rise steadily with age. Instead, surgeons 10–14 years into practice were more than twice as likely to leave as those 5–9 years in (hazard ratio 2.58). Both newer surgeons (under 5 years) and those 15–19 years in were less likely to leave. The authors link this "mid-career spike" to peak burnout, administrative burden, and competing leadership and family demands.
Other notable findings
- - Sex made no difference. Female and male surgeons left at essentially identical rates (HR 0.99) — contrary to some prior studies in academic medicine.
- - Geography mattered modestly. Compared to the Northeast, surgeons in the South had somewhat lower attrition; the West was slightly higher. Rural versus urban differences were small in the adjusted model.
- - Surgical access for orthopedic and podiatric claims looks comparatively secure based on this data — useful context when evaluating treatment-delay arguments or utilization-review timelines.
- - Rural claims face a compounding squeeze. Fewer surgeons in non-metro areas means longer travel and potential delay for injured rural workers — a recurring access issue worth flagging in case management.
- - Provider relationships are fragile mid-career. Networks and treating-physician arrangements built around a single surgeon carry succession risk.
A key caveat the authors flag: because the data is administrative billing data, they cannot always tell the difference between a true retirement, a move to a non-clinical or part-time role, or a shift in how someone bills. So "attrition" here means departure from active clinical surgical practice as Medicare sees it — not necessarily retirement.
- Exclusive Remedy Applies During Unpaid Lunch Breakon June 8, 2026 at 1:26 PM
In 2022, Kevin Wrenne was a crew member at a Taco Bell at 1220 Market Street in Redding, operated by J.A. Sutherland, Inc. and Andrew Hennan, Sr. Nielsen Motor Co. owned the property and leased it to the franchisee. On the evening of March 28, 2022, Wrenne clocked out for a 30-minute unpaid meal break, walked to the restaurant's parking lot, and sat down on the curb. A transient named Brent Close approached and stabbed him five times in the neck and chest. Wrenne died; Close was arrested and convicted of murder.
In March 2024, Wrenne's parents and his estate sued J.A. Sutherland, Nielsen Motor Co., Taco Bell Corp., and Hennan, pleading two causes of action, premises liability (dangerous and defective condition of property) and negligence. The theory was that the attack was foreseeable and preventable: the restaurant sat in a high-crime area, and defendants allegedly failed to provide adequate lighting, security guards, surveillance cameras, and safe resting areas for staff. The complaint alleged more than 1,000 calls for service to the Redding Police Department over the prior decade, including 282 in the preceding three years, 99 of them placed by Taco Bell employees.
The defendants demurred. J.A. Sutherland and Hennan argued the claims fell within the exclusive jurisdiction of the workers' compensation system because Wrenne was killed on his employer's premises during the course and scope of his employment; Taco Bell Corp. and Taco Bell Franchisor, LLC filed a parallel demurrer on the same ground. Both leaned on the "premises line rule." After the court struck the punitive damages allegations against Nielsen Motor and plaintiffs declined to amend, the demurrers were refiled and opposed.
In October 2024, the trial court sustained the demurrers without leave to amend. It found the case factually analogous to Jones v. Regents of University of California (2023) 97 Cal.App.5th 502, where a university employee's tort claims were barred after she was injured on campus shortly after leaving her workstation. Like the plaintiff in Jones, the court reasoned, Wrenne had begun his workday, remained on his employer's premises without leaving, and was uncompensated when the incident occurred. The exclusivity rule therefore barred the tort claims, and judgment was entered for defendants.
The Court of Appeal Affirmed in the unpublished case of Wrenne v. JA Sutherland, Inc. -C102531 (June 2026) Reviewing the demurrer ruling de novo, the Court of Appeal "saw no error" and upheld dismissal of the entire complaint. It also affirmed the denial of leave to amend, and awarded respondents their costs on appeal.
The injury was work-related. Under the Workers' Compensation Act (Lab. Code, § 3200 et seq.), workers' compensation is the sole remedy for injuries - including death - "arising out of and in the course of" employment. The court emphasized the Act's unusually forgiving causation standard: employment need only be a contributing cause, not the sole one. Because Wrenne would not have been in the parking lot but for his shift at Taco Bell, his death was causally linked to the employment.
The claims were derivative. Drawing on Kuciemba v. Victory Woodworks, Inc. (2023) 14 Cal.5th 993, the court explained that a third party's claim - such as an heir's wrongful death action - is barred when it is "collateral to or derivative of" the employee's workplace injury. The family's claims derived directly from Wrenne's compensable injury and thus fell inside the compensation bargain.
The premises line rule applied. This rule draws a "sharp, objective" line: employment begins when the employee enters the employer's premises and continues until departure, and the premises include the parking lot (General Ins. Co. v. Workers' Comp. Appeals Bd. (1976) 16 Cal.3d 595; Schultz v. Workers' Comp. Appeals Bd. (2015) 232 Cal.App.4th 1126). Wrenne was indisputably on those premises when he was killed.
The unpaid break did not change the result. Relying on Gutierrez v. Petoseed Co. (1980) 103 Cal.App.3d 766, the court reaffirmed that injuries on the employer's premises during a regular lunch break arise in the course of employment as incidental to it - even when the break is unpaid and the employee is not under the employer's control. That the WCA must be liberally construed in favor of awarding compensation (not permitting civil litigation) reinforced the outcome.
Plaintiffs' authorities were distinguished. The court rejected the argument that Wrenne was merely an "off duty" employee "loitering" for personal reasons - noting that word never appeared in the complaint. Makins v. Industrial Accident Com. (1926) 198 Cal. 698 and McIvor v. Savage (1963) 220 Cal.App.2d 128 were inapposite because they concern employees commuting to or from work who unreasonably delay or loiter; Wrenne was neither arriving nor leaving. The court likewise found plaintiffs' remaining cases materially distinguishable, as each involved off-premises injuries or off-duty conduct (such as voluntary recreation) not present here.
No abuse of discretion in denying amendment. Because plaintiffs never sought leave to amend below and offered no showing on appeal of facts that could cure the defect, the court found no abuse of discretion in dismissing without leave to amend (Blank v. Kirwan (1985) 39 Cal.3d 311; Schifando v. City of Los Angeles (2003) 31 Cal.4th 1074).
- 1st & 5th DCA Disagree on FCRA Class Action Standing Requirementon June 8, 2026 at 1:26 PM
In a published decision that openly splits with another district, the First District held that a plaintiff suing under the federal Fair Credit Reporting Act (15 U.S.C. § 1681 et seq.) in California state court need not prove a concrete injury to have standing. The violation of a statutory right is itself enough. The ruling reverses an order decertifying a class and expressly declines to follow the Fifth District's contrary holding in Limon v. Circle K Stores Inc. (2022) 84 Cal.App.5th 671.
Terry Askins applied online for a job with CRST Expedited, Inc., a trucking company. During the application process, CRST gave him a document disclosing that it would run a background check, and during his employment it provided additional forms relating in part to background checks. CRST conducted background checks on Askins both before and during his employment.
Askins filed a class action on behalf of CRST's current, former, and prospective job applicants nationwide for whom background checks were performed during a defined period. The complaint alleged that CRST procured consumer reports without using legally compliant disclosure and authorization forms, in violation of the FCRA (plus other claims not at issue on appeal). He sought to certify a "consumer report class" and a "driver class," along with two subclasses tied to missing authorizations and missing "Summary of Rights" notices.
The trial court granted class certification. CRST then moved to decertify, relying on the newly decided Limon, in which the Fifth District held that an FCRA plaintiff must demonstrate a cognizable injury from the noncompliant disclosure to have standing. After a hearing, the trial court agreed: it treated Limon as binding authority and found that Askins's confusion about the forms and his lack of awareness that CRST would obtain consumer reports were merely "informational" and therefore insufficient to confer standing. Because both certified classes rested on the FCRA causes of action, the court decertified the entire class.
The First Appellate District, Division Three of the Court of Appeal reversed in the published case Askins v. CRST Expedited, Inc., -No. A172921 (June 2026) and held that the FCRA does not require a concrete injury for standing in California and reversed the decertification order. It pointedly declined to follow Limon. The court did not decide whether Askins is an appropriate class representative or whether the class might be decertified on other grounds, leaving those questions for the trial court on remand. Askins recovers his costs on appeal.
Federal courts require actual, redressable harm (TransUnion LLC v. Ramirez (2021) 594 U.S. 413), but Article III's case-or-controversy limits do not bind state courts—even when they interpret federal statutes (ASARCO Inc. v. Kadish (1989) 490 U.S. 605). For statutory claims, California standing turns on statutory interpretation (Adolph v. Uber Technologies, Inc. (2023) 14 Cal.5th 1104), and a legislature may authorize statutory damages without concrete harm (Kim v. Reins International California, Inc. (2020) 9 Cal.5th 73). Whether a party may bring a federal claim in state court is itself a question of state law.
The plain text of the FCRA. Section 1681n(a)(1)(A) lets a consumer recover either "actual damages sustained … as a result of the failure" or statutory damages of $100 to $1,000. The second clause deliberately omits the limiting words "actual," "sustained by the consumer," and "as a result of the failure." Reading "damages" by its ordinary 1996 meaning—Black's Law Dictionary (6th ed. 1990) included nominal damages for vindicating a right with no provable loss—the court concluded the statutory-damages remedy reaches technical violations. The disjunctive "or" gives the two clauses separate meanings (United States v. Woods (2013) 571 U.S. 31), and construing them identically would erase the distinction Congress drew.
A statutory violation alone confers standing. The court aligned the FCRA with a line of recent California decisions holding that a bare statutory violation supplies standing under analogous consumer-protection statutes: Kashanian (Rosenthal Fair Debt Collection Practices Act); Chai v. Velocity Investments, LLC (2025) 108 Cal.App.5th 1030 (Fair Debt Buying Practices Act); Parsonage v. Wal-Mart Associates, Inc. (2026) 118 Cal.App.5th 399 and Yeh v. Barrington Pacific, LLC (2026) 117 Cal.App.5th 1303 (both under ICRAA). A plaintiff need only show "a sufficient interest in the subject matter of the dispute" (Kim, supra).
The court rejected Limon's reasoning on three points: (1) Limon contrasted "damages" with the "civil penalty" available to the FTC under § 1681s, but ignored that an FTC enforcement action involves no personal loss to the agency; (2) Limon relied on a 2019 dictionary definition of "damages" that was narrower than the 1990 definition in effect when Congress amended the FCRA in 1996; and (3) the authorities Limon cited—Raines v. Coastal Pacific Food Distributors, Inc. (2018) 23 Cal.App.5th 667 and Thomas v. FTS USA, LLC (E.D. Va. 2016) 193 F.Supp.3d 623—did not support its conclusion (Raines was not an FCRA case, and Thomas turned on Article III injury-in-fact). The court also declined to follow Muha v. Experian Information Solutions, Inc. (2024) 106 Cal.App.5th 199, which had adopted Limon.
Askins's interest was sufficient. The FCRA's disclosure provisions protect accurate reporting and consumer privacy. The parties did not dispute (for this appeal) that CRST's disclosure was noncompliant; Askins's forms were lengthy, confusing, and laden with extraneous content, leaving him unaware that a background check would occur and unable to object, decline, or verify the results. Even assuming the resulting report was accurate, that deprivation of FCRA-mandated procedural protections was a concrete interference with his statutory privacy rights—an interest "over and above" that of the public at large (Department of Fair Employment & Housing v. M&N Financing Corp. (2021) 69 Cal.App.5th 434)—and sufficed to confer standing.
- 9th Circuit Sanctioned Orange County Attorneys After AI Useon June 4, 2026 at 2:10 PM
This is a published attorney-discipline order arising out of an immigration appeal. The underlying petitioners (identified as Malkeet Lnu, Sunita Rani Lnu, and Jaivin Lohan) sought review of a Board of Immigration Appeals decision dismissing their appeal from an immigration judge's denial of asylum, withholding of removal, and protection under the Convention Against Torture. The merits are not the focus of the order; the discipline concerns the conduct of their two attorneys, Mike Singh Sethi and William Rounds of the Sethi Law Group in Orange County, California.
Sethi filed an opening brief containing two cases that do not exist — "Eduardo v. Garland" and "Lay v. Holder" — and twice attributed quotations to real opinions (Kamalthas v. INS (9th Cir. 2001) 251 F.3d 1279 and Avendano-Hernandez v. Lynch (9th Cir. 2015) 800 F.3d 1072) in which the quoted language never appeared. The reply brief and the attorneys' briefs in other pending cases contained additional fabricated citations and gross misrepresentations of real authority. The court later learned that the firm used unlicensed law-school graduates ("Brief Writers") to draft legal arguments and identify authority, that no licensed attorney read the cited cases, and that the errors were almost certainly the product of unauthorized generative-AI use, despite a purported firm policy against it.
This was an original disciplinary proceeding by the Ninth Circuit itself rather than an appeal from a lower court. After the court denied a joint motion to submit the case on the briefs, Sethi filed a "Motion to Correct," recharacterizing the two nonexistent cases as "typographical errors" and substituting two real but unrelated cases (Udo v. Garland (9th Cir. 2022) 32 F.4th 1198 and Lai v. Holder (9th Cir. 2014) 764 F.3d 1098) that did not support the propositions asserted. At oral argument, Rounds (appearing in Sethi's place) attributed the errors to "copy and paste" mistakes and three times categorically denied that generative AI was used — only later conceding under questioning that AI use was "possible." The court then issued an Order to Show Cause why the attorneys should not be sanctioned, suspended, or disbarred. The attorneys' Response ultimately conceded it was "more likely than not" that the errors resulted from unauthorized AI use by their Brief Writers.
The panel imposed discipline. It sanctioned Sethi and Rounds $2,500 each, suspended both from practice before the Ninth Circuit for six months, ordered them to notify clients, opposing counsel, presiding judges, and every attorney in their firm, required a perjury-backed AI-disclosure-and-verification statement in all future filings for two years, and directed the Clerk to forward the order to the State Bar of California.
In the published case of Lnu, et al. v. Blanche, Acting Attorney General, (U.S. Court of Appeals, Ninth Circuit, June 3, 2026) No. 24-4790, the 9th Circuit did not sanction the attorneys merely for using generative AI, which is not inherently unethical. (See Noland v. Land of the Free, L.P. (2025) 114 Cal.App.5th 426.) The rules, the court explained, are violated not at the point of research and drafting but at the point of signing and filing. Whether a fabricated citation comes from an AI tool or "his own natural intelligence," the procedural and ethical rules apply with equal force.
Sethi's signing and filing of briefs with nonexistent cases, misattributed quotations, and gross misrepresentations violated the requirement that contentions be supported by citations to authority (Fed. R. App. P. 28(a)(8)(A)), his duties of competence and diligence (Cal. R. Prof. Conduct 1.1, 1.3), and his duty to present only meritorious claims (Cal. R. Prof. Conduct 3.1(a)(2)). The court emphasized that a signature is an attestation that the signer has personally reviewed and is responsible for the filing's accuracy, an obligation that cannot be delegated to subordinates or AI. It relied heavily on Noland, which held that attorneys must personally read and verify every citation, and noted that a fabricated opinion is not "existing law." (Citing Mata v. Avianca, Inc. (S.D.N.Y. 2023) 678 F. Supp. 3d 443.) It rejected the excuses that other real cases might support the same propositions and that the citations went to minor points, observing that it is counsel's job — not the court's — to find supporting authority.
The more serious failing, and the reason for the suspension, was the repeated lack of candor (Cal. R. Prof. Conduct 3.3(a)(1)). The court found that no plausible typographical or copy-paste error could transform the real cases into the hallucinated citations, and inferred that the attorneys knew the "typographical error" explanation was false as early as the Motion to Correct. Rounds's flat denials of AI use at oral argument, followed by his concession that AI use was "possible," supported an inference of actual knowledge of falsity; the court stressed that candor requires admitting uncertainty, not just disclosing known facts. The court also faulted Sethi for a later "Notice of Errata" in another case that swapped out fabricated citations without disclosing that the originals were hallucinations. The duty of candor, the court held, requires an attorney who discovers a hallucination to promptly alert the court and opposing counsel, describe the nature of the error, and disclose its source. Had the attorneys done so candidly at the outset, lesser sanctions might have sufficed; the gravity of the discipline was owed to their repeated failure of candor.
In explaining the risks, the court drew on empirical research showing that even legal-specific AI tools from Westlaw and Lexis produced hallucinations — including subtle "inaccuracies" that misstate holdings rather than outright fabrications — in a significant share of queries, warning that inaccuracies may prove more dangerous because they are harder to detect. (Citing Magesh et al., Hallucination-Free? Assessing the Reliability of Leading AI Legal Research Tools (2025) 22 J. Empirical Legal Stud. 216.)
- IAIABC NextGen Awards Recognize 7 WorkComp Leaderson June 4, 2026 at 2:10 PM
The International Association of Industrial Accident Boards and Commissions is a not-for-profit association representing government agencies charged with the administration of workers’ compensation systems as well as other workers’ compensation professionals in the private sector. Its mission is to find solutions to reduce harm and aid recovery from occupational injuries and illnesses.
The IAIABC NextGen Awards recognize talented and transformative young professionals under the age of 40 who are having a positive impact in their organizations and the workers’ compensation industry. For the 2026 IAIABC NextGen Awards, seven recipients were selected from a pool of outstanding nominees.
"It was such a pleasure to learn all about the class of 2026 IAIABC NextGen Award recipients. These young leaders, the tenth class of NextGen winners since we started the program, are transforming the workers’ compensation space every day. The future of workers’ compensation is bright, and we look forward to sharing these rising star’s stories over the next year,” says Heather Lore, IAIABC Executive Director.
The IAIABC congratulates the recipients of the 2026 IAIABC NextGen Awards:
- - Caitlin Breitbach: Small Business Ombudsman for Workers' Compensation, Oregon Department of Consumer and Business Services
- - Ashley Butcher: Team Business Leader, SFM Mutual Insurance Company
- - Cole Garrett: Deputy General Counsel, Illinois Workers' Compensation Commission
- - Aubree Herrin: Training Development Analyst, Ohio Bureau of Workers' Compensation
- - Blair Ilsley: Supervisor of Provider Education, Colorado Division of Workers' Compensation
- - Harsh Patel: Data Architect, Business Intelligence, Saskatchewan Workers' Compensation Board
- - Brock Perkes: Senior Director, Client Success, Enlyte
In addition to the NextGen winners, the IAIABC is also proud to recognize 2 finalists and 9 honorable mentions whose work is helping to progress and elevate the workers’ compensation industry.
2026 Finalist Nominees
- - Thomas Travaglia, Verisk
- - Jaycee Verbeem, Saskatchewan Workers' Compensation Board
2026 Honorable Mention Nominees
- - Nicole Davidson, The Black Car Fund
- - Josie Flores, NCCI
- - Maison Horton, Enlyte
- - Derek Jackson, Workplace Safety and Insurance Board of Ontario
- - Caitlyn Jekel, Washington State Department of Labor and Industry
- - Claire Korte, Kansas Department of Labor, Workers' Compensation Division
- - Alex Reynolds, Colorado Division of Workers' Compensation
- - Justin Schwark, Saskatchewan Workers' Compensation Board
- - Michael Solheid, Minnesota Department of Labor and Industries
The IAIABC will share the NextGen Award recipients’ stories throughout the year, including as part of the IAIABC 112th Convention September 28-30, 2026, in Spokane, Washington. NextGen Award recipients will also be profiled in a special edition issue of Perspectives, the IAIABC’s digital publication.
Over the ten years of the IAIABC NextGen Awards, 75 individuals have been recognized with a NextGen Award. Visit www.iaiabc.org/nextgen-awards for more information about this year’s and past NextGen recipients.
- Court Must Decide if Federal or State Arbitration Law Applieson June 11, 2026 at 4:42 PM
Rebecca Orr worked briefly for United Parcel Service, Inc. ("UPS") as a Seasonal Support Driver in late 2023, picking up packages from other UPS drivers and delivering them to their final destinations during the holiday rush. When she applied, she signed an "Arbitration Agreement/Seasonal Hiring Agreement" through an online portal. The agreement was drafted to be "as broad as legally permissible" and contained four provisions that mattered to her case: a Delegation Clause giving the arbitrator exclusive authority over disputes about the agreement's validity and enforceability; a Class Action Waiver; a PAGA Individual Action Requirement Clause; and a "How This Agreement Applies" section declaring the contract governed by the Federal Arbitration Act ("FAA") — unless the FAA "does not apply to a particular dispute or to one or both parties."
Orr's experience on the job was rocky. Although UPS told her she would work eight-hour days, six days a week, her routes were shortened or canceled the morning of a scheduled shift on at least seven occasions. After a December route cancellation, she contacted HR and was told there were not enough packages to deliver. She received no further assignments despite repeated requests for work.
Orr sued UPS in the Superior Court of California for the County of Riverside, raising five state-law claims (including a claim that UPS failed to pay drivers their required "reporting time pay") on behalf of three putative classes, later adding a sixth claim under California's Private Attorneys General Act ("PAGA"). UPS removed the case to federal court and moved to compel arbitration and stay proceedings.
A central dispute emerged: Orr and UPS disagreed over whether the FAA or the California Arbitration Act ("CAA") governed the agreement. The distinction was not merely academic — the two statutes differ in ways that could change which of Orr's claims could be heard in court versus arbitration.
The district court granted UPS's motion. It ordered Orr to arbitrate her individual claims "consistent with the terms of the binding arbitration agreement," while staying litigation of the class claims pending arbitration. Critically, the court declined to decide whether the FAA or CAA applied, reasoning that the "result is the same" under either statute, so the question need not be resolved. It also concluded that Orr had forfeited any challenge to the Delegation Clause.
Orr moved for clarification under Federal Rule of Civil Procedure 60(a) and (b), arguing the court itself had to decide whether her contract fell within the FAA's exemption for certain employment contracts (9 U.S.C. § 1). The district court denied the motion, holding it had "properly refrained" from determining whether a Section 1 exemption applied because, in its view, the CAA does not require that analysis before compelling arbitration.
Because neither the FAA nor California law allows an ordinary appeal from an order granting arbitration, Orr sought a writ of mandamus from the Ninth Circuit.
This was a mandamus proceeding, not a conventional appeal, so the Ninth Circuit did not "affirm" or "reverse." Instead, the panel granted Orr's petition for a writ of mandamus and directed the district court to determine the appropriate statutory basis for its authority to compel arbitration in the published case of In re Rebecca Orr, No. 25-2330 (9th Cir. June 9, 2026). The court made clear it was not ordering that arbitration is improper — only that the legal basis for it must be decided first, with the remaining arbitrability issues left to the district court to address afterward.
The panel evaluated the five factors governing mandamus relief from Bauman v. U.S. District Court, 557 F.2d 650, 654–55 (9th Cir. 1977): (1) the absence of another adequate remedy such as direct appeal; (2) prejudice not correctable on appeal; (3) clear legal error by the district court; (4) an oft-repeated error or persistent disregard of the rules; and (5) a new and important problem or issue of first impression. The third factor — clear error — is a necessary condition, so the court began there.
Clear legal error (Factor 3). The court held the district court clearly erred by compelling arbitration without identifying the source of its authority, thereby improperly handing the FAA § 1 exemption question to the arbitrator. Under New Prime Inc. v. Oliveira, 586 U.S. 105, 111 (2019), a court — not an arbitrator — must decide whether the § 1 "contracts of employment" exclusion applies before ordering arbitration under the FAA, because a court's power to compel arbitration is bounded, not "unconditional."
Two features made the error especially clear here. First, the agreement's own choice-of-law clause assumed the FAA would control unless found inapplicable, making the FAA question a contractual prerequisite. Second, the choice of governing law was not a mere technicality: under Perry v. Thomas, 482 U.S. 483, 490–91 (1987), the FAA preempts California Labor Code § 229 (which lets employees pursue unpaid-wage claims in court despite an arbitration agreement), but California courts allow such suits when only the CAA applies, Garrido v. Air Liquide Industries U.S. LP, 241 Cal. App. 4th 833, 845 (2015).
The panel rejected UPS's argument that New Prime does not apply where state law offers an alternative basis for arbitration, noting that no federal court of appeals has allowed a district court to skip the § 1 question simply because a state statute might also compel arbitration. It pointed to its own precedents Romero v. Watkins & Shepard Trucking, Inc., 9 F.4th 1097, 1100 (9th Cir. 2021), and In re Van Dusen, 654 F.3d 838, 846 (9th Cir. 2011), as well as decisions from sister circuits, including Harper v. Amazon.com Services, Inc., 12 F.4th 287, 296 (3d Cir. 2021), and Cunningham v. Lyft, Inc., 17 F.4th 244, 253 (1st Cir. 2021).
With the first three factors — including the critical clear-error factor — strongly favoring relief, the panel granted the writ. - CVS Resolves Insulin Pen Overbilling Medi-Cal Case for $36.5Mon June 11, 2026 at 4:42 PM
The California Attorney General in collaboration with the United States Department of Justice, announced a settlement with national pharmacy chain CVS Pharmacy, Inc. (CVS) over its submissions of false claims to the Medi-Cal program for excessive dispensing of insulin pens.
The settlement resolves allegations that between January 2010 and December 2020, CVS broke the law by submitting fraudulent claims to Medi-Cal, intentionally giving patients more insulin than prescribed and lying about refill timelines to get paid for unauthorized, unnecessary medication.
The settlement agreement requires CVS to pay $36.5 million total with California’s share being over $2.7 million.
Insulin pens (hard plastic, pen-shaped cases containing syringes filled with insulin solution) are a common way for diabetic patients to self-administer insulin. During the relevant period, manufacturers frequently distributed insulin pens in five-pen cartons with each pen containing 300 units (3 mL) of insulin solution. Insulin prescriptions must set forth the “directions for use,” which typically designate both how much insulin to administer and the frequency and/or timing of when to administer it.
When pharmacies seek reimbursement from Group Health Plans (GHPs) for insulin pens, they are required to report, among other data, the “quantity dispensed” and the “days-of-supply.” The “quantity dispensed” means the total amount of medication dispensed to a patient when the pharmacy fills the prescription, and the “days-of-supply” refers to the number of days that the quantity dispensed is expected to last if taken as directed by the prescriber. Typically, pharmacists calculate days-of-supply by dividing the total quantity of medication dispensed by the patient’s “daily dose,” i.e., the amount of medication that the prescriber directs the patient to use each day.
GHP plans, and pharmacy benefit managers (“PBMs”) working on their behalf, typically set limits on the days-of-supply that a pharmacy may dispense when filling prescriptions (such as a 30-day supply), and reject reimbursement claims for fills that exceed those limits. GHPs and PBMs also deny reimbursement for prematurely refilled prescriptions—refills dispensed before the beneficiary would have consumed a substantial portion of the previously-dispensed quantity of medication if taken as prescribed. PBMs use automated processes to review claims for reimbursement submitted by pharmacies and deny claims that are submitted too far in advance of the expected refill date. The ability of PBMs to detect and reject reimbursement claims for premature refills depends on pharmacies complying with their obligations to accurately report days-of-supply data.
Dispensing insulin in full cartons containing five pens can exceed applicable days-of-supply limits, resulting in claim rejections. PBMs developed rules to address reimbursement when dispensing medications like insulin in the smallest commercially-available container would exceed the days-of-supply limit. Some PBMs required pharmacies to seek an override of the limit and then to resubmit the claim reporting the accurate days-of-supply actually dispensed so the PBM could verify when the next refill would be needed. Other PBMs permitted pharmacies to submit claims reporting the maximum days-of-supply allowed, even if that number was lower than the actual supply dispensed. Importantly, however, those PBMs still required pharmacies to track and use the actual days-of-supply dispensed to determine when patients would actually need a refill. All PBMs prohibited pharmacies from seeking reimbursement for premature refills, regardless of container size.
As alleged in the Government’s Complaint: From January 1, 2010, through December 31, 2020 (the “Covered Period”), CVS violated the FCA by knowingly submitting, or causing to be submitted, false claims to GHPs for reimbursement for insulin pens where CVS: dispensed more insulin to GHP beneficiaries than was specified by their prescriptions and refilled GHP beneficiary prescriptions substantially before GHP beneficiaries needed the refills; falsely under-reported the days-of-supply for the insulin refills, which often prevented PBMs from detecting that the refills were premature; and failed to comply with applicable rules when refilling insulin prescriptions requiring pharmacies to calculate refill dates using the actual days-of-supply dispensed.
To fill insulin prescriptions as quickly as possible and to ensure that reimbursement claims for insulin pens were not rejected, CVS instructed its pharmacy staff simply to report the maximum days-of-supply allowed under the beneficiary’s plan when dispensing full insulin pen cartons, which was often lower than the actual days-of-supply dispensed. Many CVS pharmacies did not internally document and use the actual days-of-supply dispensed to determine when patients could next refill their prescription. To the contrary, CVS’ dispensing software calculated refill dates automatically based on inaccurate days-of-supply data reported to the PBM. As a result, CVS pharmacy staff repeatedly refilled prescriptions prematurely, dispensing substantially more insulin to GHP beneficiaries than they actually needed and substantially sooner than they needed it according to their prescriptions. As a result, some GHP beneficiaries accumulated large quantities of unused insulin, which was both wasteful and potentially dangerous as insulin can expire.
CVS management was well aware that it was over-dispensing insulin. PBMs conducted periodic audits of CVS pharmacies and repeatedly found violations of the dispensing rules, including reporting invalid days-of-supply data, refilling insulin pen prescriptions too soon, and dispensing insulin pens in excess of the quantities authorized by the prescription. PBMs issued chargebacks to CVS based on these violations. For several years, CVS management knew that insulin pens were among the drug products most frequently subject to chargebacks for premature refills. Yet, despite these audit findings, CVS failed to take necessary steps to address this long-standing problem during the Covered Period.
Under the settlement, CVS admitted, among other things, that:
- - During much of the covered period, many CVS pharmacies did not break open insulin pen cartons when dispensing insulin pens. As a result, at times, CVS pharmacies dispensed amounts of insulin that exceeded applicable days-of-supply limits. When a claim for reimbursement was rejected for exceeding the limit, some CVS pharmacies did not obtain overrides and re-submit the claim listing the actual days-of-supply dispensed as required by some PBMs. Instead, CVS pharmacies often reported the maximum days-of-supply allowed under the beneficiary’s insurance plan for insulin pens when resubmitting the claim, which was lower than the actual days-of-supply dispensed. While certain PBMs allowed this practice because the carton was the smallest commercially-available container for the medication, CVS pharmacies at times did not adhere to the appropriate refill intervals for patients that were to be based on the actual days-of-supply dispensed.
- - During much of the covered period, CVS customers with insulin-pen prescriptions who enrolled in CVS’ optional auto-refill program received automatic prompts notifying them that their refilled prescriptions were available to be picked up. CVS’ auto-refill logic calculated prescription refill dates based on the days-of-supply data recorded by pharmacy staff and sent customers refill notifications based on those dates. When pharmacy staff recorded days-of-supply numbers that were lower than the actual days-of-supply dispensed, the system would at times calculate refill dates for patients that were premature. As a result, some CVS pharmacies dispensed insulin pen refills to GHP beneficiaries before the beneficiaries needed more insulin and before the GHP plan or PBM would have approved such refills for reimbursement.
- - At times during the covered period, GHPs and the payors working on their behalf paid CVS substantial amounts for insulin pen refills that were ineligible for reimbursement, and CVS pharmacies dispensed more insulin to GHP beneficiaries than they needed.
In connection with the filing of the lawsuit and settlement, the Government joined five private whistleblower lawsuits that had previously been filed under seal pursuant to the False Claims Act. - DOJ Declares EEOC's Disparate-Impact Guidelines Unconstitutionalon June 10, 2026 at 1:56 PM
The Justice Department's Office of Legal Counsel (OLC) issued an opinion on June 9 concluding that the Equal Employment Opportunity Commission's longstanding guidelines on disparate-impact liability under Title VII are unconstitutional. The opinion, signed by Assistant Attorney General T. Elliot Gaiser and Deputy Assistant Attorney General Joshua Craddock, asserts that the EEOC's approach pressures employers into race-based decision-making to avoid liability—and that, properly read, Title VII reaches only practices reflecting "a significant likelihood of intentional discrimination."
In an unusual move, DOJ announced the opinion jointly with the EEOC. OLC opinions are not court rulings, but they are treated as binding within the executive branch - meaning the EEOC and other agencies are now expected to enforce Title VII consistent with this reading.
Disparate-impact liability holds employers responsible for facially neutral practices that disproportionately burden a protected group, even absent discriminatory intent. Its origin is the Supreme Court's 1971 decision in Griggs v. Duke Power Co., which held that Title VII bars practices "fair in form, but discriminatory in operation" - in that case, a high-school-diploma requirement and an aptitude test that screened out Black applicants without being shown to predict job performance.
In 1978, the EEOC, DOL, DOJ, and the Civil Service Commission jointly adopted the Uniform Guidelines on Employee Selection Procedures (29 C.F.R. part 1607), which remain in force and require employers to "validate" any selection procedure producing an adverse impact. The Court refined the framework in Wards Cove Packing Co. v. Atonio (1989), tightening the plaintiff's burden to identify the specific practice causing a disparity. Congress responded in the Civil Rights Act of 1991, codifying the three-step burden-shifting test at 42 U.S.C. § 2000e-2(k): the plaintiff identifies a specific practice causing a disparity; the employer shows the practice is "job related" and "consistent with business necessity"; and the plaintiff may still prevail by identifying an equally effective, less-discriminatory alternative the employer refused to adopt.
Two later decisions - Ricci v. DeStefano (2009) and Texas Department of Housing v. Inclusive Communities (2015) - flagged the "serious constitutional questions" that arise if liability turns on statistical disparity alone, and emphasized that the doctrine needs limiting safeguards to avoid pushing employers toward quotas. Justice Scalia's Ricci concurrence, that the "war between disparate impact and equal protection" would eventually be waged, is quoted prominently in the new opinion.
Rather than declaring the 1991 statute itself void, OLC deploys constitutional avoidance to reinterpret Title VII narrowly and then finds specific EEOC regulations unlawful. It lays out three limiting principles:
- - 1) A low business-necessity bar. Employers need only show a challenged practice is "rational, convenient, or helpful" to a valid business purpose. Background checks, aptitude and knowledge tests, SAT scores, high-school-graduation requirements, and blind auditions are deemed presumptively job-related. Only "irrational or arbitrary" practices with no plausible job-relatedness can create liability.
- - 2) A robust causation requirement. Plaintiffs must show - at the pleading stage and beyond - that the specific challenged practice itself, not external factors, caused the disparity.
- - 3) A demanding alternative-practice requirement. Plaintiffs must identify a concrete alternative that is both less discriminatory and equally effective, including as to cost and other burdens.
Applying these principles, the opinion concludes that two parts of the EEOC's framework are independently unlawful: the validation-study requirements in the Uniform Guidelines (which it calls atextual, "labyrinthine," and improperly burden-shifting), and the Affirmative Action Guidelines (29 C.F.R. part 1608), which it says unconstitutionally encourage racial preferences without an established Title VII violation.
OLC frames the opinion as a response to the Supreme Court's June 2 per curiam decision in Allen v. Milligan and its companion Louisiana v. Callais, which reread Section 2 of the Voting Rights Act to impose liability "only when the circumstances give rise to a strong inference that intentional discrimination occurred." OLC imports that logic into Title VII.
The opinion is also the latest step in a sequence that began with President Trump's April 2025 Executive Order 14281, Restoring Equality of Opportunity and Meritocracy, directing agencies to eliminate disparate-impact enforcement. That was followed by the EEOC pausing disparate-impact investigations in 2025 and DOJ's December 2025 rule rescinding Title VI disparate-impact regulations. EEOC Chair Andrea Lucas, who formally requested the opinion in February, welcomed it as providing "clarity" on the constitutional limits of the doctrine; Acting Attorney General Todd Blanche said it would let businesses "hire based on performance."
Theoretical practical takeaways for employers and their counsel to consider at this early stage.
- - Enforcement posture has shifted, but the statute has not. The 1991 codification of disparate impact remains on the books, and courts - not OLC - decide what Title VII requires. Plaintiffs can still sue in federal court, and the private bar has signaled it will continue bringing disparate-impact claims regardless of EEOC inaction.
- - Expect agency charges to get harder to win. The EEOC is unlikely to pursue impact-only theories, and the validation and affirmative-action regulations are now treated as unenforceable within the agency.
- - Selection tools are on firmer footing - at the federal level. Tests, background checks, and similar screens face a lighter justification standard under this reading. But state and local fair-employment laws (and their own disparate-impact provisions) are unaffected and remain a live source of exposure.
- - DEI-style "voluntary affirmative action" carries fresh risk. The opinion's hostility to race-conscious "goals and timetables" reinforces the post-SFFA, post-Ames trend against preference programs.
Critics, including former Civil Rights Division attorneys, argue the opinion contradicts Supreme Court precedent and will lead to "a sharp increase in unchecked discrimination." Because an OLC opinion binds the executive branch but not the judiciary, the doctrine's ultimate fate will turn on litigation now likely to accelerate - and, eventually, on whether the Supreme Court takes up the question Justice Scalia flagged sixteen years ago.
NOTE: This summary is for informational purposes and is not legal advice. Employers should consult counsel about how these developments interact with applicable federal, state, and local law. - S.F. Telehealth Company Resolves False Claims Case for $3.325Mon June 10, 2026 at 1:56 PM
San Francisco-based Circle Medical Care of California, Circle Medical Technologies, Inc., and their Chief Medical Officer and medical director Dr. Nicole Tsang, D.O., have agreed to pay a total of $3,325,000 to the United States and the State of California to settle allegations that they knowingly submitted claims for payments to federal healthcare programs and California commercial insurers for services by providers who did not actually provide or supervise those services, in violation of the federal False Claims Act and corresponding state statute.
Circle operates an online telehealth platform through which it offers mental health treatment and primary care medical services through contract providers, including nurse practitioners and physician assistants located throughout the country. Circle submits claims for payment to federally funded health programs, including Medicare, Medicaid, and TRICARE, and to California commercial insurers.
The United States and California allege that Circle submitted claims for payment to these programs and insurers for services, and received reimbursement, between January 1, 2018, and May 31, 2025, despite knowingly identifying the name and NPI (National Provider Identifier) number of rendering providers who did not actually provide or supervise the services rendered, and failed properly to supervise the nurse practitioners and physician assistants who rendered medical services to its patients during this period.
Under the settlement agreement, Circle will pay $475,000 to the United States and $2,850,000 to California.
United States Attorney Craig H. Missakian, Special Agent in Charge Robb R. Breeden of the U.S. Department of Health and Human Services Office of Inspector General (HHS OIG), and Assistant Inspector General and Health Care Fraud Division Director Jennifer K. Dietz of the Defense Health Agency Office of Inspector General (DHA-OIG) made the announcement.
The settlement resolves claims brought under the qui tam or whistleblower provisions of the False Claims Act by Jason Vellen. Under those provisions, a private party can file an action on behalf of the United States and receive a portion of any recovery. The qui tam case is captioned United States and State of California ex rel. Jason Vellen v. Circle Medical Care of California, Circle Medical Technologies, Inc., Dr. Nicole Tsang, D.O, and George Favvas, No. 3:24-cv-02024-TSH (N.D. Cal.). In connection with the settlement, Mr. Vellen will receive $80,750 from the United States and $997,500 from California.
Assistant U.S. Attorney Savith Iyengar handled this matter. The resolution resulted from a coordinated effort among the U.S. Attorney’s Office for the Northern District of California, the California Department of Insurance, and the San Francisco District Attorney’s Office.
The claims resolved by the settlement are allegations only, and there has been no determination of liability. - CWCI Reports Private Self-Insured Claims Fall But Losses Riseon June 9, 2026 at 3:43 PM
Private self insurers are required to file Self Insurer's Annual Reports by March 1 each year. Each private Self Insurer's report is required to include paid, estimated future, and total incurred claims costs for each of the past five calendar years (claims reported from January 1 through December 31 for each year), as well as paid, estimated future, and total incurred claims costs for any claims still open from earlier reported years.
California private self-insured employers reported fewer workers’ compensation claims in 2025, driving private, self-insured claim frequency to a 5-year low, but initial data show signs of rising claim costs according to a new California Workers’ Compensation Institute (CWCI) analysis of first-report data from the state Office of Self-Insurance Plans (OSIP).
The latest data show private self-insured employers in California covered nearly 2.22 million employees in 2025, down 1.5% from the prior year. Despite the slight reduction in the covered workforce, private self-insured wages and salaries totaled nearly $152.5 billion, up 1.1% from the prior year. At the same time, the number of reported claims in the private self-insured sector fell for the third year in a row, declining 2.7% to 84,996 claims. That total is 18.5% below the 2022 peak, when thousands of COVID-19 cases pushed the private self-insured claim count up to 104,278.
Overall, private self-insured claim frequency edged down from 3.88 claims per 100 employees in 2024 to 3.83 claims per 100 employees last year, the lowest level since 2020. The Institute notes that both indemnity and medical-only claim frequency have fallen since the pandemic-era spike in COVID-related claims, with the decline in indemnity frequency contributing just slightly more to the overall reduction in private self-insured claim frequency.
Despite the declines in private self-insured claim volume and frequency, comparing the initial loss data from all 2024 and 2025 claims (medical-only and indemnity) show total paid losses remained essentially unchanged at $352.4 million. At the same time, total incurred losses (paid benefits plus reserves for future payments) rose 4.8% to $979.2 million, reflecting increases in expected claim costs, as the average incurred loss per claim increased 7.7% last year, driven largely by growth in medical reserves.
The Institute also found that both average paid and average incurred losses on private self-insured claims have been trending up for several years. Comparing first-report loss payments on all private self-insured claims from recent years, the Institute found that the average paid loss rose 2.5% to $4,147 in 2025, marking the third consecutive annual increase. Since bottoming out at $2,983 in 2022, the average paid loss has increased 39.0%. Meanwhile, the average incurred loss climbed to $11,520 last year, up 48.1% since 2022. Higher indemnity and medical losses both contributed to these increases, but rising medical losses have been the key cost driver, as the first report data from 2022 and 2025 show the average paid medical loss per claim increased 48.4% and the average incurred medical loss per claim increased 55.2%; so even with the 18.5% reduction in claim volume, total paid medical losses increased 20.9%; and total incurred medical losses increased 26.5%.
OSIP’s newly released data summary provides the first look at California private self-insured workers’ compensation experience for calendar year 2025 and includes updated experience for claims reported from 2021 through 2024. OSIP has posted its latest summary, along with those from the previous 24 years. - Study Shows High Attrition Rate for Surgeons Nationwideon June 9, 2026 at 3:43 PM
Every workers' compensation claim involving a serious injury eventually runs into a question of access: Is there a surgeon available to operate, and how soon? Surgeon supply drives surgical wait times, which drive temporary disability duration, return-to-work timelines, and ultimately claim cost.
A new study "National Analysis of Trends and Factors Associated with Surgeon Attrition in the US" published in the Journal of the American College of Surgeons (2026, published ahead of print) is the largest national look to date at how surgeons are leaving active practice — and it gives a data-backed sense of where the supply pressure is, and is not, building.
The team of researchers tracked 224,629 surgeons across 19 surgical specialties using Medicare billing data from 2013 through 2023, following them for a median of 8 years. They defined "attrition" as a surgeon who stopped showing meaningful clinical activity (fewer than 50 evaluation-and-management services per year) for three straight years. They then used statistical modeling to identify which factors predicted leaving practice.
Nearly one in ten U.S. surgeons left active practice over eight years, but the loss is concentrated — heaviest among mid-career surgeons and a handful of specialties, lightest in the orthopedic and podiatric fields that drive most workers' comp surgical care. The supply picture is best understood specialty by specialty, not as a single national number.
- - Roughly 1 in 10 surgeons (9.7%) left active clinical practice over the 8-year window. That works out to about 15,753 surgeons.
- - Annual attrition held steady at 1.5–1.7% per year from 2013 to 2018, then spiked to 2.5% in 2019 before dropping to 1.3% in 2020. The authors attribute the spike largely to the early COVID-19 period.
- - If that rate holds, the authors project a loss of roughly 2,000 surgeons per year — about 25,000 to 30,000 over the next decade.
- - The workforce is aging: median years in practice nearly doubled from 7 (2013) to 16 (2023).
- - The share of women surgeons rose from 21% to 29%.
- - Rural surgical presence shrank — from about 10.5% of surgeons in rural/non-metro areas in 2013 to 8.5% in 2023.
The detail that matters most: it varies enormously by specialty. Attrition is not uniform — and for workers' compensation purposes, the differences cut in a reassuring direction for the specialties that are critical..
High-attrition specialties 5-Year Cumulative Attrition
- - Oral & Maxillofacial Surgery - 25.1%
- - Obstetrics & Gynecology - 23.2%
- - Plastic & Reconstructive Surgery - 19.3%
Low-attrition specialties 5-Year Cumulative Attrition
- - Otolaryngology (ENT) - 1.8%
- - Podiatry / Foot & Ankle - 1.8%
- - Orthopedic Surgery - 2.4%
- - Vascular Surgery - 3.1%
The specialties that handle the bulk of occupational injuries — orthopedic surgery, podiatry/foot-and-ankle, and to a lesser extent vascular and neurosurgery — show among the lowest attrition rates and the shallowest decline curves. Orthopedics in particular, the workhorse of musculoskeletal injury care, is a relatively stable specialty in this data. That's encouraging for surgical access on most lost-time claims.
The authors suggest the high-attrition specialties are pressured by heavy call burdens, malpractice exposure, market competition, and the availability of non-clinical career exits — while the more stable specialties tend to offer more predictable schedules and clearer paths to dialing back late-career rather than leaving outright.
One of the more surprising results: attrition does not rise steadily with age. Instead, surgeons 10–14 years into practice were more than twice as likely to leave as those 5–9 years in (hazard ratio 2.58). Both newer surgeons (under 5 years) and those 15–19 years in were less likely to leave. The authors link this "mid-career spike" to peak burnout, administrative burden, and competing leadership and family demands.
Other notable findings
- - Sex made no difference. Female and male surgeons left at essentially identical rates (HR 0.99) — contrary to some prior studies in academic medicine.
- - Geography mattered modestly. Compared to the Northeast, surgeons in the South had somewhat lower attrition; the West was slightly higher. Rural versus urban differences were small in the adjusted model.
- - Surgical access for orthopedic and podiatric claims looks comparatively secure based on this data — useful context when evaluating treatment-delay arguments or utilization-review timelines.
- - Rural claims face a compounding squeeze. Fewer surgeons in non-metro areas means longer travel and potential delay for injured rural workers — a recurring access issue worth flagging in case management.
- - Provider relationships are fragile mid-career. Networks and treating-physician arrangements built around a single surgeon carry succession risk.
A key caveat the authors flag: because the data is administrative billing data, they cannot always tell the difference between a true retirement, a move to a non-clinical or part-time role, or a shift in how someone bills. So "attrition" here means departure from active clinical surgical practice as Medicare sees it — not necessarily retirement. - Exclusive Remedy Applies During Unpaid Lunch Breakon June 8, 2026 at 1:26 PM
In 2022, Kevin Wrenne was a crew member at a Taco Bell at 1220 Market Street in Redding, operated by J.A. Sutherland, Inc. and Andrew Hennan, Sr. Nielsen Motor Co. owned the property and leased it to the franchisee. On the evening of March 28, 2022, Wrenne clocked out for a 30-minute unpaid meal break, walked to the restaurant's parking lot, and sat down on the curb. A transient named Brent Close approached and stabbed him five times in the neck and chest. Wrenne died; Close was arrested and convicted of murder.
In March 2024, Wrenne's parents and his estate sued J.A. Sutherland, Nielsen Motor Co., Taco Bell Corp., and Hennan, pleading two causes of action, premises liability (dangerous and defective condition of property) and negligence. The theory was that the attack was foreseeable and preventable: the restaurant sat in a high-crime area, and defendants allegedly failed to provide adequate lighting, security guards, surveillance cameras, and safe resting areas for staff. The complaint alleged more than 1,000 calls for service to the Redding Police Department over the prior decade, including 282 in the preceding three years, 99 of them placed by Taco Bell employees.
The defendants demurred. J.A. Sutherland and Hennan argued the claims fell within the exclusive jurisdiction of the workers' compensation system because Wrenne was killed on his employer's premises during the course and scope of his employment; Taco Bell Corp. and Taco Bell Franchisor, LLC filed a parallel demurrer on the same ground. Both leaned on the "premises line rule." After the court struck the punitive damages allegations against Nielsen Motor and plaintiffs declined to amend, the demurrers were refiled and opposed.
In October 2024, the trial court sustained the demurrers without leave to amend. It found the case factually analogous to Jones v. Regents of University of California (2023) 97 Cal.App.5th 502, where a university employee's tort claims were barred after she was injured on campus shortly after leaving her workstation. Like the plaintiff in Jones, the court reasoned, Wrenne had begun his workday, remained on his employer's premises without leaving, and was uncompensated when the incident occurred. The exclusivity rule therefore barred the tort claims, and judgment was entered for defendants.
The Court of Appeal Affirmed in the unpublished case of Wrenne v. JA Sutherland, Inc. -C102531 (June 2026) Reviewing the demurrer ruling de novo, the Court of Appeal "saw no error" and upheld dismissal of the entire complaint. It also affirmed the denial of leave to amend, and awarded respondents their costs on appeal.
The injury was work-related. Under the Workers' Compensation Act (Lab. Code, § 3200 et seq.), workers' compensation is the sole remedy for injuries - including death - "arising out of and in the course of" employment. The court emphasized the Act's unusually forgiving causation standard: employment need only be a contributing cause, not the sole one. Because Wrenne would not have been in the parking lot but for his shift at Taco Bell, his death was causally linked to the employment.
The claims were derivative. Drawing on Kuciemba v. Victory Woodworks, Inc. (2023) 14 Cal.5th 993, the court explained that a third party's claim - such as an heir's wrongful death action - is barred when it is "collateral to or derivative of" the employee's workplace injury. The family's claims derived directly from Wrenne's compensable injury and thus fell inside the compensation bargain.
The premises line rule applied. This rule draws a "sharp, objective" line: employment begins when the employee enters the employer's premises and continues until departure, and the premises include the parking lot (General Ins. Co. v. Workers' Comp. Appeals Bd. (1976) 16 Cal.3d 595; Schultz v. Workers' Comp. Appeals Bd. (2015) 232 Cal.App.4th 1126). Wrenne was indisputably on those premises when he was killed.
The unpaid break did not change the result. Relying on Gutierrez v. Petoseed Co. (1980) 103 Cal.App.3d 766, the court reaffirmed that injuries on the employer's premises during a regular lunch break arise in the course of employment as incidental to it - even when the break is unpaid and the employee is not under the employer's control. That the WCA must be liberally construed in favor of awarding compensation (not permitting civil litigation) reinforced the outcome.
Plaintiffs' authorities were distinguished. The court rejected the argument that Wrenne was merely an "off duty" employee "loitering" for personal reasons - noting that word never appeared in the complaint. Makins v. Industrial Accident Com. (1926) 198 Cal. 698 and McIvor v. Savage (1963) 220 Cal.App.2d 128 were inapposite because they concern employees commuting to or from work who unreasonably delay or loiter; Wrenne was neither arriving nor leaving. The court likewise found plaintiffs' remaining cases materially distinguishable, as each involved off-premises injuries or off-duty conduct (such as voluntary recreation) not present here.
No abuse of discretion in denying amendment. Because plaintiffs never sought leave to amend below and offered no showing on appeal of facts that could cure the defect, the court found no abuse of discretion in dismissing without leave to amend (Blank v. Kirwan (1985) 39 Cal.3d 311; Schifando v. City of Los Angeles (2003) 31 Cal.4th 1074). - 1st & 5th DCA Disagree on FCRA Class Action Standing Requirementon June 8, 2026 at 1:26 PM
In a published decision that openly splits with another district, the First District held that a plaintiff suing under the federal Fair Credit Reporting Act (15 U.S.C. § 1681 et seq.) in California state court need not prove a concrete injury to have standing. The violation of a statutory right is itself enough. The ruling reverses an order decertifying a class and expressly declines to follow the Fifth District's contrary holding in Limon v. Circle K Stores Inc. (2022) 84 Cal.App.5th 671.
Terry Askins applied online for a job with CRST Expedited, Inc., a trucking company. During the application process, CRST gave him a document disclosing that it would run a background check, and during his employment it provided additional forms relating in part to background checks. CRST conducted background checks on Askins both before and during his employment.
Askins filed a class action on behalf of CRST's current, former, and prospective job applicants nationwide for whom background checks were performed during a defined period. The complaint alleged that CRST procured consumer reports without using legally compliant disclosure and authorization forms, in violation of the FCRA (plus other claims not at issue on appeal). He sought to certify a "consumer report class" and a "driver class," along with two subclasses tied to missing authorizations and missing "Summary of Rights" notices.
The trial court granted class certification. CRST then moved to decertify, relying on the newly decided Limon, in which the Fifth District held that an FCRA plaintiff must demonstrate a cognizable injury from the noncompliant disclosure to have standing. After a hearing, the trial court agreed: it treated Limon as binding authority and found that Askins's confusion about the forms and his lack of awareness that CRST would obtain consumer reports were merely "informational" and therefore insufficient to confer standing. Because both certified classes rested on the FCRA causes of action, the court decertified the entire class.
The First Appellate District, Division Three of the Court of Appeal reversed in the published case Askins v. CRST Expedited, Inc., -No. A172921 (June 2026) and held that the FCRA does not require a concrete injury for standing in California and reversed the decertification order. It pointedly declined to follow Limon. The court did not decide whether Askins is an appropriate class representative or whether the class might be decertified on other grounds, leaving those questions for the trial court on remand. Askins recovers his costs on appeal.
Federal courts require actual, redressable harm (TransUnion LLC v. Ramirez (2021) 594 U.S. 413), but Article III's case-or-controversy limits do not bind state courts—even when they interpret federal statutes (ASARCO Inc. v. Kadish (1989) 490 U.S. 605). For statutory claims, California standing turns on statutory interpretation (Adolph v. Uber Technologies, Inc. (2023) 14 Cal.5th 1104), and a legislature may authorize statutory damages without concrete harm (Kim v. Reins International California, Inc. (2020) 9 Cal.5th 73). Whether a party may bring a federal claim in state court is itself a question of state law.
The plain text of the FCRA. Section 1681n(a)(1)(A) lets a consumer recover either "actual damages sustained … as a result of the failure" or statutory damages of $100 to $1,000. The second clause deliberately omits the limiting words "actual," "sustained by the consumer," and "as a result of the failure." Reading "damages" by its ordinary 1996 meaning—Black's Law Dictionary (6th ed. 1990) included nominal damages for vindicating a right with no provable loss—the court concluded the statutory-damages remedy reaches technical violations. The disjunctive "or" gives the two clauses separate meanings (United States v. Woods (2013) 571 U.S. 31), and construing them identically would erase the distinction Congress drew.
A statutory violation alone confers standing. The court aligned the FCRA with a line of recent California decisions holding that a bare statutory violation supplies standing under analogous consumer-protection statutes: Kashanian (Rosenthal Fair Debt Collection Practices Act); Chai v. Velocity Investments, LLC (2025) 108 Cal.App.5th 1030 (Fair Debt Buying Practices Act); Parsonage v. Wal-Mart Associates, Inc. (2026) 118 Cal.App.5th 399 and Yeh v. Barrington Pacific, LLC (2026) 117 Cal.App.5th 1303 (both under ICRAA). A plaintiff need only show "a sufficient interest in the subject matter of the dispute" (Kim, supra).
The court rejected Limon's reasoning on three points: (1) Limon contrasted "damages" with the "civil penalty" available to the FTC under § 1681s, but ignored that an FTC enforcement action involves no personal loss to the agency; (2) Limon relied on a 2019 dictionary definition of "damages" that was narrower than the 1990 definition in effect when Congress amended the FCRA in 1996; and (3) the authorities Limon cited—Raines v. Coastal Pacific Food Distributors, Inc. (2018) 23 Cal.App.5th 667 and Thomas v. FTS USA, LLC (E.D. Va. 2016) 193 F.Supp.3d 623—did not support its conclusion (Raines was not an FCRA case, and Thomas turned on Article III injury-in-fact). The court also declined to follow Muha v. Experian Information Solutions, Inc. (2024) 106 Cal.App.5th 199, which had adopted Limon.
Askins's interest was sufficient. The FCRA's disclosure provisions protect accurate reporting and consumer privacy. The parties did not dispute (for this appeal) that CRST's disclosure was noncompliant; Askins's forms were lengthy, confusing, and laden with extraneous content, leaving him unaware that a background check would occur and unable to object, decline, or verify the results. Even assuming the resulting report was accurate, that deprivation of FCRA-mandated procedural protections was a concrete interference with his statutory privacy rights—an interest "over and above" that of the public at large (Department of Fair Employment & Housing v. M&N Financing Corp. (2021) 69 Cal.App.5th 434)—and sufficed to confer standing. - 9th Circuit Sanctioned Orange County Attorneys After AI Useon June 4, 2026 at 2:10 PM
This is a published attorney-discipline order arising out of an immigration appeal. The underlying petitioners (identified as Malkeet Lnu, Sunita Rani Lnu, and Jaivin Lohan) sought review of a Board of Immigration Appeals decision dismissing their appeal from an immigration judge's denial of asylum, withholding of removal, and protection under the Convention Against Torture. The merits are not the focus of the order; the discipline concerns the conduct of their two attorneys, Mike Singh Sethi and William Rounds of the Sethi Law Group in Orange County, California.
Sethi filed an opening brief containing two cases that do not exist — "Eduardo v. Garland" and "Lay v. Holder" — and twice attributed quotations to real opinions (Kamalthas v. INS (9th Cir. 2001) 251 F.3d 1279 and Avendano-Hernandez v. Lynch (9th Cir. 2015) 800 F.3d 1072) in which the quoted language never appeared. The reply brief and the attorneys' briefs in other pending cases contained additional fabricated citations and gross misrepresentations of real authority. The court later learned that the firm used unlicensed law-school graduates ("Brief Writers") to draft legal arguments and identify authority, that no licensed attorney read the cited cases, and that the errors were almost certainly the product of unauthorized generative-AI use, despite a purported firm policy against it.
This was an original disciplinary proceeding by the Ninth Circuit itself rather than an appeal from a lower court. After the court denied a joint motion to submit the case on the briefs, Sethi filed a "Motion to Correct," recharacterizing the two nonexistent cases as "typographical errors" and substituting two real but unrelated cases (Udo v. Garland (9th Cir. 2022) 32 F.4th 1198 and Lai v. Holder (9th Cir. 2014) 764 F.3d 1098) that did not support the propositions asserted. At oral argument, Rounds (appearing in Sethi's place) attributed the errors to "copy and paste" mistakes and three times categorically denied that generative AI was used — only later conceding under questioning that AI use was "possible." The court then issued an Order to Show Cause why the attorneys should not be sanctioned, suspended, or disbarred. The attorneys' Response ultimately conceded it was "more likely than not" that the errors resulted from unauthorized AI use by their Brief Writers.
The panel imposed discipline. It sanctioned Sethi and Rounds $2,500 each, suspended both from practice before the Ninth Circuit for six months, ordered them to notify clients, opposing counsel, presiding judges, and every attorney in their firm, required a perjury-backed AI-disclosure-and-verification statement in all future filings for two years, and directed the Clerk to forward the order to the State Bar of California.
In the published case of Lnu, et al. v. Blanche, Acting Attorney General, (U.S. Court of Appeals, Ninth Circuit, June 3, 2026) No. 24-4790, the 9th Circuit did not sanction the attorneys merely for using generative AI, which is not inherently unethical. (See Noland v. Land of the Free, L.P. (2025) 114 Cal.App.5th 426.) The rules, the court explained, are violated not at the point of research and drafting but at the point of signing and filing. Whether a fabricated citation comes from an AI tool or "his own natural intelligence," the procedural and ethical rules apply with equal force.
Sethi's signing and filing of briefs with nonexistent cases, misattributed quotations, and gross misrepresentations violated the requirement that contentions be supported by citations to authority (Fed. R. App. P. 28(a)(8)(A)), his duties of competence and diligence (Cal. R. Prof. Conduct 1.1, 1.3), and his duty to present only meritorious claims (Cal. R. Prof. Conduct 3.1(a)(2)). The court emphasized that a signature is an attestation that the signer has personally reviewed and is responsible for the filing's accuracy, an obligation that cannot be delegated to subordinates or AI. It relied heavily on Noland, which held that attorneys must personally read and verify every citation, and noted that a fabricated opinion is not "existing law." (Citing Mata v. Avianca, Inc. (S.D.N.Y. 2023) 678 F. Supp. 3d 443.) It rejected the excuses that other real cases might support the same propositions and that the citations went to minor points, observing that it is counsel's job — not the court's — to find supporting authority.
The more serious failing, and the reason for the suspension, was the repeated lack of candor (Cal. R. Prof. Conduct 3.3(a)(1)). The court found that no plausible typographical or copy-paste error could transform the real cases into the hallucinated citations, and inferred that the attorneys knew the "typographical error" explanation was false as early as the Motion to Correct. Rounds's flat denials of AI use at oral argument, followed by his concession that AI use was "possible," supported an inference of actual knowledge of falsity; the court stressed that candor requires admitting uncertainty, not just disclosing known facts. The court also faulted Sethi for a later "Notice of Errata" in another case that swapped out fabricated citations without disclosing that the originals were hallucinations. The duty of candor, the court held, requires an attorney who discovers a hallucination to promptly alert the court and opposing counsel, describe the nature of the error, and disclose its source. Had the attorneys done so candidly at the outset, lesser sanctions might have sufficed; the gravity of the discipline was owed to their repeated failure of candor.
In explaining the risks, the court drew on empirical research showing that even legal-specific AI tools from Westlaw and Lexis produced hallucinations — including subtle "inaccuracies" that misstate holdings rather than outright fabrications — in a significant share of queries, warning that inaccuracies may prove more dangerous because they are harder to detect. (Citing Magesh et al., Hallucination-Free? Assessing the Reliability of Leading AI Legal Research Tools (2025) 22 J. Empirical Legal Stud. 216.) - IAIABC NextGen Awards Recognize 7 WorkComp Leaderson June 4, 2026 at 2:10 PM
The International Association of Industrial Accident Boards and Commissions is a not-for-profit association representing government agencies charged with the administration of workers’ compensation systems as well as other workers’ compensation professionals in the private sector. Its mission is to find solutions to reduce harm and aid recovery from occupational injuries and illnesses.
The IAIABC NextGen Awards recognize talented and transformative young professionals under the age of 40 who are having a positive impact in their organizations and the workers’ compensation industry. For the 2026 IAIABC NextGen Awards, seven recipients were selected from a pool of outstanding nominees.
"It was such a pleasure to learn all about the class of 2026 IAIABC NextGen Award recipients. These young leaders, the tenth class of NextGen winners since we started the program, are transforming the workers’ compensation space every day. The future of workers’ compensation is bright, and we look forward to sharing these rising star’s stories over the next year,” says Heather Lore, IAIABC Executive Director.
The IAIABC congratulates the recipients of the 2026 IAIABC NextGen Awards:
- - Caitlin Breitbach: Small Business Ombudsman for Workers' Compensation, Oregon Department of Consumer and Business Services
- - Ashley Butcher: Team Business Leader, SFM Mutual Insurance Company
- - Cole Garrett: Deputy General Counsel, Illinois Workers' Compensation Commission
- - Aubree Herrin: Training Development Analyst, Ohio Bureau of Workers' Compensation
- - Blair Ilsley: Supervisor of Provider Education, Colorado Division of Workers' Compensation
- - Harsh Patel: Data Architect, Business Intelligence, Saskatchewan Workers' Compensation Board
- - Brock Perkes: Senior Director, Client Success, Enlyte
In addition to the NextGen winners, the IAIABC is also proud to recognize 2 finalists and 9 honorable mentions whose work is helping to progress and elevate the workers’ compensation industry.
2026 Finalist Nominees
- - Thomas Travaglia, Verisk
- - Jaycee Verbeem, Saskatchewan Workers' Compensation Board
2026 Honorable Mention Nominees
- - Nicole Davidson, The Black Car Fund
- - Josie Flores, NCCI
- - Maison Horton, Enlyte
- - Derek Jackson, Workplace Safety and Insurance Board of Ontario
- - Caitlyn Jekel, Washington State Department of Labor and Industry
- - Claire Korte, Kansas Department of Labor, Workers' Compensation Division
- - Alex Reynolds, Colorado Division of Workers' Compensation
- - Justin Schwark, Saskatchewan Workers' Compensation Board
- - Michael Solheid, Minnesota Department of Labor and Industries
The IAIABC will share the NextGen Award recipients’ stories throughout the year, including as part of the IAIABC 112th Convention September 28-30, 2026, in Spokane, Washington. NextGen Award recipients will also be profiled in a special edition issue of Perspectives, the IAIABC’s digital publication.
Over the ten years of the IAIABC NextGen Awards, 75 individuals have been recognized with a NextGen Award. Visit www.iaiabc.org/nextgen-awards for more information about this year’s and past NextGen recipients.