Category: Daily News

In December 2019, Jazmine Quintero applied for employment with Dolgen California, LLC (Dollar General), a wholly owned subsidiary of Dollar General Corporation. She was employed by Dollar General from December 14, 2019, until January 4, 2021, when she resigned.

As part of the application and hiring process, Quintero accessed Dollar General’s web-based Express Hiring system, and electronically signed Dollar General’s arbitration agreement. In addition to other provisions, the agreement provided “Class and Collective Action Waiver: You and Dollar General may not assert any class action, collective action, or representative action claims in any arbitration pursuant to this Agreement or in any other forum.”

Quintero sued her former employer, Dollar General, to recover civil penalties under the Private Attorneys General Act of 2004 (PAGA; Lab. Code, § 2698 et seq.) for various Labor Code violations suffered by her or by other employees. Dollar General moved to compel arbitration, which the superior court denied.

Dollar General appealed. The order denying Dollar General’s motion to compel arbitration was reversed in part and affirmed in part in the unpublished case of Quintero v. Dolgen California, LLC – F083769 (February 2023).

An issue in this appeal is whether plaintiff’s PAGA claims seeking civil penalties for Labor Code violations suffered by employees other than plaintiff may be pursued by plaintiff in court. The issue is pending before the California Supreme Court. (Adolph v. Uber Technologies, Inc. (2022) (Aug. 1, 2022, S274671) [2022 Cal. Lexis 5021].)

The Court of Appeal has already decided that and other issues involving Dollar General’s arbitration agreement in Galarsa v. Dolgen California, LLC, -F082404 (Feb. 2, 2023 ), which it did not publish “because it soon will be superseded by the decision in Adolph.”

It also said that in Silva v. Dolgen California, LLC (Oct. 21, 2022, E078185) review granted Jan. 25, 2023, S277538 – another case involving Dollar General’s arbitration agreement – “our Supreme Court granted review and deferred briefing pending a decision in Adolph, which suggests the court will do the same in Galarsa and this case.”

Thus a disposition of this case by a memorandum opinion in accordance with the California Standards of Judicial Administration, Standard 8.1 was found to be appropriate.

Conclusion One: Viking River and the FAA (9 U.S.C. § 1 et seq.) do not invalidate the rule of California law that a provision in an arbitration agreement purporting to waive an employee’s right to pursue representative actions is not enforceable as to representative claims pursued under PAGA. (See Iskanian v. CLS Transportation Los Angeles, LLC (2014) 59 Cal.4th 348, 360 [“an arbitration agreement requiring an employee as a condition of employment to give up the right to bring representative PAGA actions in any forum is contrary to public policy”], abrogated on another ground by Viking River, supra, 142 S.Ct. 1906.)

Conclusion Two: The severability clause in the arbitration agreement allows the unenforceable waiver provision to be stricken from the agreement. (Viking River, supra, 142 S.Ct. at p. 1925.)

Conclusion Three: The provisions of the arbitration agreement remaining after the invalid waiver of representative claims is stricken cover the PAGA claims that seek to recover civil penalties for Labor Code violations suffered by plaintiff.

Conclusion Four: Plaintiff’s PAGA claims that seek to recover civil penalties for Labor Code violations suffered by employees other than plaintiff may be pursued by plaintiff in court.

Based on Viking River Cruises, Inc. v. Moriana (2022) 596 U.S. ___ [142 S.Ct. 1906] (Viking River) and the Federal Arbitration Act (FAA; 9 U.S.C. § 1 et seq.), the Court of Appeal concluded the parties’ agreement requires arbitration of plaintiff’s PAGA claims that seek to recover civil penalties for Labor Code violations suffered by plaintiff.

On an issue of California law currently pending before the California Supreme Court, it concluded plaintiff’s PAGA claims that seek to recover civil penalties for Labor Code violations suffered by employees other than plaintiff may be pursued by plaintiff in the superior court.

As football fans across the country prepare for Super Bowl parties, Courthouse News reports that 10 former players are suing the NFL’s benefit plan for what they say are wrongful denials of disability benefits.

The class action filed Thursday in U.S. District Court in Baltimore, home of the league’s benefit plan office, seeks to remove all members of the disability board, including chairman and NFL Commissioner Roger Goodell, for “egregious and repeated breaches of fiduciary duties.”

Former players Jason Alford, Willis McGahee, Daniel Loper, Michael McKenzie, Jamize Olawale, Alex Parsons, Eric Smith, Charles Sims, Joey Thomas and Lance Zeno represent the proposed class. These plaintiffs “seek to pull back the curtain on behalf of all similarly situated former NFL players, bringing many relevant factual and legal issues concerning the plan to light,” the 86-page complaint states.

The players accuse the board of “ever-shifting inconsistent and illogical interpretations of the terms of the plan,” and say “reliance on conflicted advisors have resulted in a pattern of systematic bias against disabled NFL players” motivated by financial considerations to limit the payment of benefits to the very players whom the plan was designed to help.”

According to the complaint, in order to receive benefits, players must undergo an excessively complicated process in which many are denied for arbitrary reasons. Over 1,000 players applied for benefits each year between 2014 and 2016, the lawsuit states.

The players specifically complain about the use of so-called neutral physicians appointed by the board to examine players who apply for benefits.

Plaintiff Lance Zeno played center for the Dallas Cowboys, Cleveland Browns, Tampa Bay Buccaneers, Green Bay Packers and St. Louis Rams between 1991 and 1996, and suffered numerous concussions over his playing career. A benefit board-appointed physician, Dr. Dean Delis, concluded that Zeno showed no evidence of mild acquired neurocognitive impairment. Zeno’s test scores, however, had been described by other physicians as showing mild impairments.

“The plan, however, does not contain other procedures to ensure that plan represented ‘neutral ph,ysicians’ are indeed impartial and unbiased,” the lawsuit states. “The plan provides no other penalties for inaccurate or inadequate decision-making by plan-declared ‘neutral physicians.'”

The players claim that the board relies on physicians like Delis, who has authored or co-authored multiple publications that downplay the effects of traumatic brain injuries or attempt to shift those effects to other non-cognitive causes. Delis has received north of a million dollars for his work with the board, according to the complaint, and in a study of 66 players he evaluated, 92% were deemed not entitled to benefits.

“The board knows that, having collected more than $1.1 million from the plan, Dr. Delis benefits financially from doing repeat business with the board,” the filing states. “It follows that the board knows that Dr. Delis has an incentive to provide it with reports that will increase the chances that the board will frequently return to him in the future.”

The board’s four highest-paid neutral physicians concluded that none of the 46 players that applied for total and permanent disability from April 2019 through March 2020 qualified.

The players claim the board failed to look at the totality of players’ injuries and instead viewed each individually when reviewing an application for benefits.

“Defendants wrongfully denied benefits and abused their discretion when they unreasonably failed to consider that players may be T & P disabled from the cumulative impact and combined effects of all of a claimant’s impairments,” they claim.

Despite rule changes with player safety in mind, NFL players continue to suffer violent injuries, including those suffered this season by Buffalo Bills safety Damar Hamlin, who collapsed on the field last month after suffering cardiac arrest, and Miami Dolphins quarterback Tua Tagovailoa, who was carted off the field with head and neck injuries last September.

Common injuries that derail pro football careers include disc herniations. From the 2000 season to the 2012 season, 275 disc herniations occurred in the spine of NFL players. Shoulder instability is also typical for players, with 403 such injuries documented in 355 players from 2012 to 2017.

In addition to in-season injuries, the NFL’s style of play has long-term effects on retired players like those who filed the lawsuit. Over 36% of former players complain of suffering from degenerative joint disease. A Boston University study on the brains of deceased former players found that 92% suffered from chronic traumatic encephalopathy, or CTE.

“Signs and symptoms of CTE include, but are not limited to, memory loss, attention and processing speed impairment, confusion, impaired judgment, visual spatial impairment, depression, language impairment, parkinsonism, suicidality, and progressive dementia,” the complaint states. “These symptoms often manifest years or even decades after a player’s last brain trauma.”

Centene Corporation, is a Fortune 50 company (ranked 26th), and is a diversified, multi-national health care enterprise that provides a portfolio of services to government-sponsored health care programs. Centene is the parent company of Health Net. It is a big player in state Medicaid drug programs – but one with a questionable record.

In recent years, the company was accused by six states of overbilling their Medicaid programs for prescription drugs and pharmacy services and settled to the tune of $264.4 million. Three other states made similar allegations and have settled with the company, but the amounts have not been disclosed. Centene, in resolving the civil actions, denied any wrongdoing.

And they now have resolved their pending case in California. This month the California Attorney General announced a settlement of more than $215 million against the Centene Corporation over allegations that the national healthcare company overcharged California’s Medi-Cal program by falsely reporting higher prescription drug costs incurred by two of its managed care plans.

In doing so, Centene is alleged to have violated the California False Claims Act. California Health & Wellness and Health Net, the two managed care plans, provide healthcare services to Medi-Cal beneficiaries in over 20 California counties.

California Department of Justice investigators found that between January 2017 and December 2018, California Health & Wellness and Health Net reported inflated figures for the costs they incurred in providing prescription drugs to patients.

Centene allegedly leveraged advantages in its pharmacy benefit manager (PBM) contracts to save its managed care plans $2.70 per prescription drug claim over the two-year period. DOJ alleges that Centene and its PBM failed to disclose or pass on these discounted fees to Medi-Cal, which inflated fees and drug costs reported to California.

The settlement amounts to a total of $215,392,758, recovers twice the value of Centene’s inflated price reporting, and ensures full restitution to the Medi-Cal program.

Nonetheless in January 2023 the California Department of Health Care Services selected Centene’s California subsidiary – Health Net of California – for direct contracts in Los Angeles and Sacramento counties, increasing the number of direct county contracts by DHCS to 10.

In total, Health Net will provide Medi-Cal managed care services in Los Angeles, Sacramento, Amador, Calaveras, Inyo, Mono, San Joaquin, Stanislaus, Tulare and Tuolumne counties. Health Net continues to serve members in Fresno, Imperial, Kings, and Madera counties via other contractual arrangements. Health Net did not receive an award ini San Diego.

More troubling is a report a few months ago by NPR Saint Luis that claims “Centene showers politicians with millions as it courts contracts and settles overbilling allegations.” One example in a sister state, involves Nevada Gov. Steve Sisolak, who they say “has accepted at least $197,000 from Centene, its subsidiaries, top executives, and their spouses since August 2018.”

They report that less than two months after Centene’s subsidiary contributions in November 2021 for his re-election were made, Nevada settled with the company over allegations the insurer overbilled the state’s Medicaid pharmacy program. The state attorney general’s office did not publicly announce the $11.3 million settlement but disclosed it in response to a public records request from KHN.

The contract went before the Nevada Board of Examiners for final approval. Sisolak is one of three voting members.

Since 2015, Centene, its subsidiaries, its top executives, and their spouses have given more than $26.9 million to state politicians in 33 states, to their political parties, and to nonprofit fundraising groups, according to a KHN analysis of IRS tax filings and data from the nonpartisan, nonprofit group OpenSecrets.

Last year, according to IRS filings that go through Sept. 30, Centene has given $2.2 million, combined, to the Republican and Democratic governors’ associations, which help elect candidates from their respective parties. And Centene gave $250,000, combined, to the Republican Attorneys General Association and its Democratic counterpart.

State attorneys general, whose campaigns are benefiting from the associations’ money, have negotiated massive settlements with Centene over accusations the company’s prescription drug programs overbilled Medicaid.

More than 20 states are investigating or have investigated Centene’s Medicaid pharmacy billing. The company has agreed to pay settlements to 13 of those states, with the total reaching about $596 million.

And Centene told KHN in October that it is working to settle with Georgia and eight more states that it didn’t identify. It has denied wrongdoing in all the investigations.

Abraham Degala was attacked and seriously injured by unknown assailants while he was working at a construction site at the Hunters Point East-West housing complex in San Francisco.

The Hunters Point East-West construction project involved the rehabilitation of 27 buildings containing residential units. John Stewart Company (JSC) was the general partner of the limited partnership that owned the property, and as such signed the contract hiring Cahill Contractors, Inc. as the general contractor on the project. Cahill in turn hired Janus Corporation as a subcontractor to perform demolition work at the site. Abraham Degala was an employee of Janus, and one of its foremen. The project site was located in an area known to have a high rate of crime.

JSC and Cahill jointly made decisions as to the appropriate amount of site security. JSC and Cahill had weekly discussions about site security because of ongoing concerns about the safety of property and people at the site.

In the months and weeks leading up to the January 2017 attack on Degala, Cahill changed security measures from time to time, including closing the project site, in part as an apparent response to incidents in the neighborhood. In August 2016, Cahill stopped weekday overtime work at part of the project because of concerns about worker safety arising from neighborhood tensions. In mid-November 2016, after a shooting in the neighborhood, Cahill instructed workers to stop work before sundown. Later that month, after another shooting, Cahill instructed workers to stay indoors as much as possible while working and to eat lunch and take breaks inside.

The physical attack on Degala took place on the walkway between the two buildings, which was outside the fence line of the construction site. As an employee of Janus, Degala was covered by workers compensation insurance for his injuries.

Degala sued JSC and Cahill, seeking damages on the basis of negligence and premises liability. JSC and Cahill filed separate motions for summary judgment. The trial court granted the motions and judgments were entered for defendants.

Degala appealed, and the court of appeal concluded there are triable issues of fact as to whether the site owner and general contractor are liable to Degala under a retained control theory. Thus it reversed and remanded in the published case of Degala v. John Stewart Company  -A163130 (February 2023).

Because Degala, as an injured employee of a contractor (Janus), sued the hirer of the contractor (Cahill) and the landowner (JSC) in tort to recover for his injuries, this case implicates the Privette doctrine, a long-standing common law principle that a hirer or landowner is ordinarily not liable for injuries to contract workers, as set forth in Privette v. Superior Court (1993) 5 Cal.4th 689 and subsequent cases.

The trial court rejected Degala’s argument that defendants could be liable to him under the Hooker exception to the Privette doctrine announced in Hooker v. Department of Transportation (2002) 27 Cal.4th 198, 201-202 (Hooker) which applies when the hirer retains control over any part of the contractor’s work and exercises that control in a way that affirmatively contributes to the plaintiff’s injury.

The California Supreme Court in Sandoval v. Qualcomm Inc. (2021) 12 Cal.5th 256, 269-270 recognized exceptions to the Privette doctrine, which “apply where delegation is either ineffective or incomplete.”

At issue in this case is the exception for incomplete delegation, recognized in Hooker. “[W]hen the hirer does not fully delegate the task of providing a safe working environment, but in some manner actively participates in how the job is done, and that participation affirmatively contributes to the [contractor’s] employee’s injury, the hirer may be liable in tort to the [contractor’s] employee.” (Kinsman v. Unocal Corp. (2005) 37 Cal.4th 659, 671 (Kinsman) [discussing Hooker, supra].)

Accordingly, “[i]f a hirer entrusts work to an independent contractor, but retains control over safety conditions at a jobsite and then negligently exercises that control in a manner that affirmatively contributes to an employee’s injuries, the hirer is liable for those injuries, based on its own negligent exercise of that retained control.” (Tverberg v. Fillner Construction, Inc. (2012) 202 Cal.App.4th 1439, 1446 (Tverberg).)

Degala argues that the evidence shows that the site security measures in place at the time he was attacked were not reasonable in the circumstances; that JSC and Cahill were negligent in configuring the fences, removing security guards, and failing to monitor the on-site cameras during the day; and that their negligence contributed to his injuries.

“Whether the measures taken by JSC and Cahill were reasonable, and whether or to what extent the alleged unreasonableness of those measures contributed to Degala’s injuries are all questions of fact for a jury to resolve. On the record here, these issues cannot be resolved as a matter of law, and therefore it was error to grant summary judgment. ”

The U.S. Supreme Court gave two doctors found guilty of misusing their licenses in the midst of the U.S. opioid epidemic to write thousands of prescriptions for addictive pain medications another chance to challenge their convictions.

Xiulu Ruan and Shakeel Kahn are medical doctors licensed to prescribe controlled substances. Each was tried for violating 21 U. S. C. §841, which makes it a federal crime, “[e]xcept as authorized[,] . . . for any person knowingly or intentionally . . . to manufacture, distribute, or dispense . . . a controlled substance.”

A federal regulation authorizes registered doctors to dispense controlled substances via prescription, but only if the prescription is “issued for a legitimate medical purpose by an individual practitioner acting in the usual course of his professional practice.” 21 CFR §1306.04(a).

At issue in Ruan’s and Kahn’s trials was the mens rea – or state of mind – required to convict under §841 for distributing controlled substances not “as authorized.”

Ruan and Kahn each contested the jury instructions pertaining to mens rea given at their trials, and each was ultimately convicted under §841 for prescribing in an unauthorized manner. Ruan, who practiced in Alabama, and Kahn, who practiced in Arizona and then Wyoming, were sentenced to 21 and 25 years in prison, respectively, in separate criminal cases.

Their convictions were separately affirmed by the Courts of Appeals for the 10th and 11th circuits.

Both doctors appealed their convictions to the U.S. Supreme Court which overturned their convictions in the combined case of Xiulu RUAN, Petitioner v. United States and Shakeel Kahn, Petitioner v. United States. Nos. 20-1410 and 21-5261. (June 2022)

The question before the Supreme Court concerned the state of mind that the Government must prove to convict these doctors of violating the statute. The cases concerned the good faith defense available to defendants charged under the U.S. Controlled Substances Act.

The Government argued that requiring it to prove that a doctor knowingly or intentionally acted not “as authorized” will allow bad-apple doctors to escape liability by claiming idiosyncratic views about their prescribing authority.

Ultimately SCOTUS held that the statute’s “knowingly or intentionally” mens rea applies to authorization. After a defendant produces evidence that he or she was authorized to dispense controlled substances, the Government must prove beyond a reasonable doubt that the defendant knew that he or she was acting in an unauthorized manner, or intended to do so.

Additionally, the court rejected the “bad-apple” argument, that the additional burden on the government to prove would allow doctors to escape criminal liability much more easily, by stating that such an argument could be applied to almost all cases.

The court vacated the decisions and remanded the cases for further proceedings in its 9-0 ruling. On remand, the 10 Circuit has now issued its published opinion in the case of United States v Shakeel Kahn – 19-8054 (February 2023).

During his testimony at trial, Dr. Kahn did not contest the fact that he wrote the relevant prescriptions, nor did he contest that the testifying patients were abusing or selling their medications. The central issue put to the jury in Dr. Kahn’s trial was his intent in issuing the charged prescriptions.

It concluded that the jury instructions issued in Dr. Kahn’s case are inconsistent with the mens rea standard set by the Supreme Court. Each of Dr. Kahn’s convictions was impacted by erroneous instructions in a way that prejudiced him, and, therefore, it remand with directions to vacate his convictions on all counts, and remand for a new trial.