Category: Daily News

This is a wage-and-hour class action that, as the court itself observed, has outlasted nearly every comparable case in California history — the original complaint was filed 19 years ago, and the matter has already generated multiple interlocutory appeals and writ proceedings, including review by the California Supreme Court (North American Title Co. v. Superior Court (2024) 17 Cal.5th 155).

Roughly 700 escrow officers and escrow-related employees of North American Title Company (now known as Lennar Title, Inc., referred to as “NATC”) sued over alleged failure to pay overtime and provide meal and rest breaks. The employees were divided into two certified classes: a “Nonexempt” class alleging they were pressured to work “off the clock,” and an “Exempt” class of roughly 400 employees alleging they had been misclassified as exempt and were therefore owed overtime. The escrow officers held a wide variety of job titles, worked in more than 80 offices across 23 counties, and earned compensation that frequently included substantial incentive pay — some class members earned well over $250,000 in a year.

The central legal question was whether class members spent more than half their workday on duties qualifying as “exempt work” under California’s quantitative test for the relevant Labor Code exemptions.

Before trial, both classes dismissed their statutory Labor Code claims and proceeded solely under the Unfair Competition Law (UCL). The case was tried in two bifurcated phases. In the first phase (the so-called “liability phase,” tried in 2015), the court limited each side to roughly 100 witnesses to prove or refute the claims of all 700 class members. Following that phase, the court ruled against NATC on its exemption defenses on a classwide basis, decertified the Nonexempt class, and — critically — appointed a referee to conduct a second phase to determine UCL restitution for the Exempt class. The court did this without the parties’ consent and over NATC’s strenuous objections.

The reference proceedings stretched on for years and included live testimony from more than 230 individual class members. The trial court then adopted nearly all of the referee’s findings and ultimately entered a judgment of roughly $43.5 million against NATC (more than half of which was prejudgment interest). Judgment was entered against NATC and for the Exempt class, but in NATC’s favor against two named plaintiffs, Kimberly Baker and Carolyn Cortina (the original plaintiff), who had not testified at trial. Both sides appealed.

The Fifth District reversed for the most part in the partially published case of Cortina v. North Am. Title Co. -F085389 (May 2026). It affirmed the judgment only as to codefendant North American Services, LLC (which prevailed below) and as to one individual plaintiff, Janet Doran. In all other respects the judgment was reversed, the case was ordered decertified as a class action, and the matter was remanded for retrial of the named plaintiffs’ individual claims (with leave for the trial court to entertain a new certification motion as to the Exempt class). On the plaintiffs’ cross-appeal, the court also reversed the judgment that had gone against Baker and Cortina, allowing them to pursue their claims on retrial. The court identified two independent grounds compelling reversal.

First, the nonconsensual reference was unauthorized. Under the California Constitution (Cal. Const., art. VI, §§ 21, 22) and Code of Civil Procedure section 638, a court may refer a matter to a referee without the parties’ consent only in narrowly limited circumstances. (People v. Superior Court (Laff) (2001) 25 Cal.4th 703.) The court held that delegating years of restitution proceedings — including testimony from 230-plus class members on contested liability-type issues — fell outside those limited categories. It described a nonconsensual reference of this scope and magnitude as not merely rare but apparently unprecedented in California law, and concluded this error alone required reversal.

Second, the first phase of trial violated the controlling principles of Duran v. U.S. Bank National Assn. (2014) 59 Cal.4th. Duran requires that statistical sampling used to establish classwide liability rest on a scientifically valid methodology — expert-determined sample size, an acceptable margin of error, and randomly selected witnesses. Here, plaintiffs sought to prove the Exempt class’s claims through testimony from only about 15 percent of one cohort (roughly 24 of 156 “Branch Managers”) offered as “representative,” without meeting any of Duran’s methodological requirements. Because some class members (such as Branch Managers) indisputably performed exempt work, the absence of valid common proof meant the trier of fact had no reliable basis to extrapolate to a classwide judgment. (Marlo v. United Parcel Service, Inc. (C.D. Cal. 2008) 251 F.R.D. 476.) The court also faulted the trial court for rejecting NATC’s affirmative defenses wholesale based on misinterpretations of law and for barring NATC from questioning second-phase witnesses on its exemption defenses.

Under Duran, “decertification must be ordered whenever a trial plan proves unworkable,” and the court held the unworkability of the plan was apparent by the end of the first phase. Combined with the prejudicial errors, this warranted not only reversal but decertification by the appellate court itself.

Finally, on the cross-appeal, the court held the judgment against Baker and Cortina could not stand once the broader judgment was reversed, and remanded so they too could litigate their individual claims on retrial. Notably, the opinion was certified for publication except for Part III (the cross-appeal discussion).

Michelle Paknad, a former employee of Intuitive Surgical, Inc., filed suit against the company and two former supervisors after she was fired, alleging sexual harassment, gender discrimination, and unlawful retaliation. While still employed, Paknad had lodged two formal internal complaints, which Intuitive responded to by retaining outside attorney Andrea Kelly Smethurst to conduct independent investigations. Smethurst interviewed witnesses, reviewed documents, and produced two detailed reports — each organized into five parts covering Paknad’s allegations, witnesses and documents reviewed, summaries of witness interviews, factual findings, and legal conclusions with recommendations to management. Intuitive shared only a summary of findings with Paknad and withheld the underlying reports entirely.

In defending against Paknad’s lawsuit, Intuitive asserted an “avoidable consequences” affirmative defense, touting the investigations as thorough and independent. Intuitive’s interrogatory responses stated that it had “thoroughly investigated every allegation that plaintiff presented by hiring an independent, outside investigator to conduct two investigations, interview numerous witnesses, and reviewed a large volume of documentary evidence.”

When Paknad moved to compel production of the Smethurst reports and investigative materials, the trial court initially denied the motion, finding the materials shielded by attorney-client privilege and attorney work product protection.

That ruling led to the first round of appellate review (Paknad v. Superior Court, May 20, 2024, H050711 (Paknad I)), in which the Court of Appeal found that Intuitive had waived both privileges by placing the scope and adequacy of the investigations at issue, and directed the trial court to grant Paknad’s motion — subject to in camera review to determine whether any narrow protection survived.

On remand, the trial court reviewed Intuitive’s proposed redactions in camera and accepted them. Intuitive had redacted all of Part IV (Smethurst’s factual findings) and substantial portions of Part V (Smethurst’s conclusions and legal recommendations), reasoning that every redacted passage reflected attorney mental impressions, conclusions, or legal theories, rendering them absolutely protected core work product under California Code of Civil Procedure section 2018.030, subdivision (a). The court granted the motion to compel only as to the unredacted remainder — effectively stripping out all of Smethurst’s factual determinations before turning over the reports.

The Court of Appeal denied Paknad’s second petition for writ of mandate, however ruled upon it after remand from the Supreme Court. In the published case of Paknad v. Superior Court  (Paknad II) -H052652 (April 2026), the Court of Appeal directed the trial court to vacate its August 27, 2024 order, conduct a further in camera review, and order disclosure of all materials within the scope of Intuitive’s waiver.

The Court of Appeal held that the trial court had asked the wrong question. Rather than asking whether the redacted materials constituted core work product, the court was required to ask whether those materials fell within the scope of Intuitive’s waiver — a distinct inquiry that the trial court never performed.

The appellate court clarified that Paknad I had found waiver of both the attorney-client privilege and core attorney work product protection, following two controlling authorities. In Wellpoint Health Networks, Inc. v. Superior Court (1997) 59 Cal.App.4th 110, the court held that an employer who defends an employment lawsuit by relying on the thoroughness and propriety of its internal investigation waives both the attorney-client privilege and the work product doctrine as to that investigation. In People v. Superior Court (Jones) (2021) 12 Cal.5th 348, the California Supreme Court confirmed that even core work product is subject to waiver when the holder voluntarily places the protected material at issue — there, a prosecutor who relied on an undisclosed juror rating system to justify peremptory challenges waived work product protection as to that system.

Applying those principles, the court held that Intuitive’s waiver extended to: (1) all of Smethurst’s factual findings about Paknad’s allegations of discrimination, harassment, or retaliation; and (2) any information in the reports or investigative materials bearing on the scope or adequacy of Smethurst’s investigations. The factual findings were directly relevant to both prongs — they revealed how Smethurst weighed evidence and assessed witness credibility, and they were essential for Paknad to evaluate Intuitive’s repeated claim that the investigations were independent and objective. Because Intuitive put Smethurst’s independence at issue, Paknad was entitled to access the findings to assess whether bias infected the process.

The court rejected Intuitive’s argument that the redacted findings were shielded because they reflected legal judgment and experience, reasoning that having voluntarily commissioned and then weaponized those findings in its defense, Intuitive could not simultaneously disclaim their investigative character to preserve them from disclosure.

On remand, the court directed that further in camera review focus not on whether materials constitute core work product, but solely on whether they fall within the scope of what Intuitive placed at issue — and any such material must be disclosed to Paknad regardless of its work product character.

Hospital for Special Surgery (HSS) in New York City — ranked the number one orthopedic hospital in the United States for 16 consecutive years by U.S. News & World Report — is deploying a technology that could fundamentally change how orthopedic surgical decisions are made, documented, and disputed in workers’ compensation cases. The tool is called a “digital twin,” and it is moving from the research lab into everyday clinical practice.

A digital twin is a virtual replica of a patient’s own anatomy, built from advanced 3D MRI imaging and powered by physics-based computational modeling. In orthopedics, this means a surgeon can create a detailed, patient-specific computer model of an injured knee — including bones, cartilage surfaces, ligaments, and the mechanical relationships between them — and then run simulations on that model before operating.

The surgeon can test different surgical approaches on the virtual knee: tighten or loosen virtual ligaments, reposition virtual implant components, simulate how the joint will behave under load after various types of repair — all without touching the actual patient. The goal, as HSS Digital Twin Program Director Dr. Andrew Pearle has described it, is to move orthopedics beyond one-size-fits-all surgical planning toward truly individualized treatment based on each patient’s unique anatomy and biomechanics.

HSS received a $10 million gift in November 2025 from Lauren and Robert Steers to develop the HSS Digital Twin Platform into a four-year clinical program. The institution’s stated goal is that within four years, every patient who comes to HSS with a relevant clinical problem will receive a digital twin of their knee. The multidisciplinary team includes orthopedic surgeons, radiologists, biomechanical engineers, and artificial intelligence specialists.

The platform is already being applied to clinical cases. One of the initial applications has been evaluating patients who need ACL revision surgery — a repeat procedure after a prior ACL repair has failed. In these complex cases, surgeons must determine whether the patient would also benefit from a slope-reducing tibial osteotomy, a procedure that reshapes the angle of the shinbone to reduce the mechanical forces that contributed to the original graft failure.

Traditionally, this determination has relied on the surgeon’s clinical judgment, standard imaging, and experience. With the digital twin, the surgical team can simulate both options — revision alone versus revision plus osteotomy — on the patient’s own virtual anatomy and compare the predicted biomechanical outcomes before making a recommendation.

The platform also integrates additional data beyond imaging: patient gender, activity level, the type of physical demands the patient faces (including occupational demands), and neuromuscular control information. As HSS researchers have described it, the more data fed into the twin, the more precise and personalized the insights become.

HSS is not working alone. The institution is collaborating with other medical centers and organizations to scale the platform, and the underlying technologies — computational modeling, physics-based simulation, AI-enhanced imaging analysis — are advancing rapidly across the orthopedic field. Medscape reported in April 2026 that the platform represents a new frontier in precision orthopedic care that may extend beyond surgical planning into injury prevention.

The trajectory is clear: orthopedic surgery is moving from population-based decision-making toward individualized, simulation-driven planning. For workers’ comp, that means the medical evidence supporting — or challenging — surgical recommendations in injury claims is about to become significantly more sophisticated. Adjusters, attorneys, utilization review teams, and medical evaluators who understand what a digital twin is, what data it produces, and what its limitations are will be better positioned to handle the claims that follow.

The California Supreme Court has scheduled oral argument in the case of Joseph Mayor v. Workers’ Compensation Appeals Board et.al., S287261 for April 2nd, 2026 at 1:30 pm.

In a triad of published decisions by three separate Court of Appeal panels, namely, Earley v. Workers’ Comp. Appeals Bd., et al., 94 Cal. App. 5th 1 (2023) (“Earley”), Zurich American Ins. Co. v. Workers’ Comp. Appeals Bd., et al., 97 Cal. App. 5th 1213 (2023)(“Zurich”), and most recently in Mayor v. Workers’ Comp. Appeals Bd., et al., 104 Cal. App. 5th 1297 (2024) (“Mayor”), the Workers’ Compensation Appeals Board’s “grant for study” orders pursuant to the former version of Labor Code section 5909 (Section 5909) have been found to be unlawful.

The Mayor court found that the Appeals Board exceeded its jurisdiction when it issued the order granting reconsideration beyond 60 days from the date the petition was filed with the DWC. (Mayor, supra, 104 Cal.App.5th at p. 725.) The court granted a writ of mandate and ordered that the Appeals Board rescind its order granting reconsideration and its January and February decisions. (Id. at p. 731.)

This appears to be a systemic problem with the WCAB. The Amicus Curiae Brief of American Property Casualty Insurance Association stated “[o]ne appellate court noted that, as of November 2021, there were over 500 pending cases in which the WCAB had invoked “Shipley tolling” and issued a boilerplate “further study” order. The practice since then has continued unabated, often ending in simple affirmances in unremarkable cases.”

The parties sought review of the Courts of Appeal decisions, and the Supreme Court granted review in Mayor. The Supreme Court is asked to answer the question presented by the essential issue “[m]ay the Appeals Board apply equitable tolling to act upon a petition for reconsideration beyond the 60-day period provided in Labor Code section 5909, when, through no fault of the parties, the Appeals Board did not receive the petition for reconsideration until after the 60-day period has elapsed?” Review was granted on December 11, 2024.

After the Petition for Review was granted, the parties filed briefs with the Supreme Court, presenting their view of the facts and law on the issues presented as follows.

– – Respondent, Workers’ Compensation Appeals Board, Petition for Review Filed on October 7, 2024
– – Petitioner’s Answer to Petition for Review Filed on October 25, 2024
– – Respondent, Workers’ Compensation Appeals Board, Reply to Answer to Petition for Review Filed on November 4, 2024
– – Respondent, Workers’ Compensation Appeals Board, Opening Brief on the Merits Filed on February 10, 2025
– – Petitioner’s Answer Brief on the Merits Filed on March 10, 2025
– – Petitioner’s Notice of Errata Filed on March 11, 2025
– – Respondent, Workers’ Compensation Appeals Board, Reply Brief on the Merits Filed on April 1, 2025
– – Amicus Curiae Brief of American Property Casualty Insurance Association Filed on June 2, 2025
– – Amicus Curiae Brief of Mashallah Ishal Filed on June 3, 2025
– – Respondent, Workers’ Compensation Appeals Board, Response to Amicus Curiae Brief Filed on July 1, 2025
– – Respondent, Workers’ Compensation Appeals Board, Response to Amicus Curiae Brief Filed on July 3, 2025
– – Petitioner’s Supplemental Brief Filed on March 13, 2026

Subsequently, in City of Salinas v. Workers’ Compensation Appeals Board (Miraco) (2025) 113 Cal.App.5th 801 (S293212): Review was granted on November 19, 2025, but briefing has been deferred pending a decision in the lead case of Mayor v. Workers’ Compensation Appeals Board (S287261). No oral arguments are scheduled, and no decision has been issued in Miraco.

In the lead case, Joseph Mayor argues that Labor Code §5909 is mandatory and jurisdictional, and the appeals Board does not have fundamental jurisdiction to consider a petition for reconsideration after the expiration of the 60-day limit set forth in the statute.

The WCAB responds by saying “[f]or 30 years, the courts of this state followed the Fourth District’s decision in Shipley v. Workers’ Comp. Appeals Bd. (1992) 7 Cal.App.4th 1104, 1107 (“Shipley”), holding that because section 5909 is premised upon the Appeals Board having possession of a petition for reconsideration, equitable tolling may apply to extend the 60-day deadline to act in cases where the Appeals Board does not have the petition.” It urges the Supreme Court to follow the rationale in Shipley.

The American Property Casualty Insurance Association (APCIA) said it is the primary national trade association for home, auto, and business insurers, with a legacy dating back 150 years. APCIA’s members represent 65 percent of the United States property-casualty insurance market and write more than $65 billion in premiums in the State of California annually, including over 71 percent of the workers’ compensation insurance market.

APCIA said it “is interested in this case because the Workers’ Compensation Appeals Board’s months-long delay in ruling on the petition for reconsideration here is part of a widespread and damaging practice.”

Target Corporation hired Daniel Husband in October 2020 as a fulfillment expert at its Burbank store. Although Target’s new-hire materials explained that the company would attempt to accommodate known physical or mental limitations, Husband did not disclose to any Target official that he had been diagnosed with bipolar I disorder. He worked without incident for approximately 20 months.

Things changed in the summer of 2022. On June 9, 2022, Husband entered the store while off duty and became visibly upset with an employee; the employee reported that Husband used profanity, though Husband denied it. He was verbally counseled and later received a written memo.

On July 7, 2022, Husband arrived for his night shift looking deflated, then suddenly became angry. He recounted hitting himself in the temple and said that his fulfillment workload was “laughing at him.” He became highly emotional, pointed fingers, and yelled at a coworker. His supervisor, Daniel Abts, sent him home. Abts found the behavior “somewhat disturbing” and emailed store leadership expressing concern for Husband’s “mental state.”

The next evening, July 8, Husband arrived shaking, distraught, and breathing heavily. He told Abts he thought he had “killed” his stepmother by speaking a word and asked whether he had killed anyone at the store. Abts found the statements “very irrational” and “very disturbing,” believed Husband “needed help,” and sent him home with a recommendation that he see a doctor or psychiatric professional. Husband and his father returned to the store that night and again the next morning, July 9, insisting Husband was “fine.” During the July 9 meeting with store leadership, managers reported that Husband erupted with profanity directed at Target, though Husband’s father denied the outburst occurred.

Later on July 9, Target’s store director, human resources lead, and district HR business partner decided to terminate Husband for violating the company’s workplace violence policy. At that time, Husband had never informed Target of his bipolar disorder or requested any accommodations. On July 10 — after the termination decision had been made but before Husband was informed — he arrived barefoot at the store, entered the employee-only area, grabbed security keys, ran out, claimed to be someone else, threw the keys at an employee, and began to disrobe. On July 18, Husband submitted a medical note clearing him to return to work but disclosing no diagnosis; he was informed that day of his termination. Subsequent requests for reinstatement, including a September 2022 letter from counsel asserting disability discrimination, went unanswered.

Husband sued Target under the Fair Employment and Housing Act (FEHA) for disability discrimination, failure to provide reasonable accommodation, and failure to engage in the interactive process. Target moved for summary judgment. The trial court granted the motion, ruling that Target had no knowledge of Husband’s mental disability when it decided to terminate him because there was more than one reasonable interpretation of his workplace conduct, and that Husband had never disclosed his disability or requested accommodation. The court also found that Target had a legitimate, nondiscriminatory reason for the termination — a genuine belief that Husband had made threats or engaged in violence against coworkers in violation of company policy.

The Second District Court of Appeal affirmed in the published case of Husband v. Target Corporation, -No. B342334 (May 2026).

The opinion addresses a question at the intersection of all three FEHA theories: under what circumstances will an employer be charged with knowledge of an undisclosed mental disability based solely on its own observations? The court held that, as a matter of law, two incidents of aggressive, emotional, and irrational behavior were insufficient to impute such knowledge.

For a FEHA discrimination claim, the court applied the standard from Brundage v. Hahn (1997) 57 Cal.App.4th 228, 237: when an employee has not disclosed a disability, the employer is charged with knowledge only when “the fact of disability is the only reasonable interpretation of the known facts.” For failure-to-accommodate and interactive-process claims, the court applied the related standard from Pensinger v. Bowsmith, Inc. (1998) 60 Cal.App.4th 709, 724–725, and Soria v. Univision Radio Los Angeles, Inc. (2016) 5 Cal.App.5th 570, 601: an employer’s duty is triggered only when observed symptoms “are so obviously manifestations of an underlying disability” that the existence of a disability “always follows” from them.

The court acknowledged that Husband’s conduct was consistent with a mental disability but concluded it was not uniquely indicative of one. His behavior could also reasonably be attributed to the effects of illegal substances, a combination of medications, or sleep deprivation — a point Husband himself conceded during his deposition. Abts’s subjective impression that Husband “needed help” and might benefit from seeing a psychiatric professional did not change the analysis. The standard is objective, the court emphasized, and one untrained supervisor’s speculation does not establish that a mental disability was the only reasonable interpretation of the facts. Allowing a co-worker’s subjective opinion to control would make employer liability turn on the vagaries of individual workplace knowledge and willingness to speculate.

The court rejected Husband’s reliance on Ninth Circuit decisions equating conduct caused by a disability with the disability itself, including Gambini v. Total Renal Care, Inc. (9th Cir. 2007) 486 F.3d 1087, 1093. Adopting that framework, the court reasoned, would effectively require every front-line supervisor to have mastered the Diagnostic and Statistical Manual — an unwarranted assumption that would vastly expand FEHA liability beyond its purpose.