Category: Daily News

In 2014, La Kimba Bradsbery and Cheri Brakensiek filed a putative class action against their former employer, Vicar Operating, Inc.,alleging claims on behalf of “[a]ll individuals who worked for [Vicar] in California as a veterinary assistant, veterinary technician, surgery technician, kennel technician, client service representative, or similar position” in the four years before the complaint was filed.

Plaintiffs alleged Vicar failed to provide them with the meal periods required by section 512 and IWC Wage Order Nos. 4-2001 (Wage Order No. 4) and 5-2001 (Wage Order No. 5).

In April 2009, Plaintiffs each signed a written meal period waiver with Vicar. The waiver stated: “I hereby voluntarily waive my right to a meal break when my shift is 6 hours or less. I understand that I am entitled to take an unpaid 30-minute meal break within my first five hours of work; however, I am voluntarily waiving that meal break. I understand that I can revoke this waiver at any time by giving written revocation to my manager.”

Vicar moved for summary adjudication regarding the validity of this waiver under section 512 and the wage orders. Vicar argued the prospective meal period waiver was valid because “neither the Labor Code nor the wage orders specify what form the waiver must take, or when or how it may be obtained.”

Plaintiffs opposed, arguing prospective waivers were prohibited under Wage Order Nos. 4 and 5 (together, the “wage orders”), an opinion letter from the Division of Labor Standards Enforcement (DLSE) interpreting an agricultural wage order, and Brinker Restaurant Corp. v. Superior Court (2012) 53 Cal.4th 1004. Plaintiffs further argued employees could waive a meal period for a given shift only after they were scheduled to work that shift.

The trial court agreed with defendants and determined the waivers were valid and ruled for Vicar.The Court of Appeal affirmed in the published case of Bradsbery v. Vicar Operating, Inc. – B322799 (April 2025).

At issue in this case is the meaning of the phrase “waived by mutual consent” of the employer and employee in section 512 and the two wage orders, and whether that meaning prohibits the prospective written waivers Vicar had its employees sign.

The Court of Appeal noted that the text of section 512 and the text of the wage orders are all silent regarding the timing (prospective or as-accrued) and form (written or oral) of a meal period waiver for shifts between five and six hours. The text also does not define “waived” or “waiver.” The meal period waiver provisions at issue here in section 512 and section 11(A) of the wage orders do not require a written waiver (let alone in mandatory language).

“The administrative history of the wage orders reflects the IWC has not viewed prospective written waivers as negatively as Plaintiffs suggest. The waiver of off-duty meal periods in a prospective written agreement instituted in 1976 was at the request of employees on wage boards and was seen by the IWC as protecting employees and employers. Similarly, in promulgating the waiver provisions for health care employees working eight-hour shifts in 1993, the IWC characterized the use of waivers as a ‘protective condition[]” for employers and employees.’ “

“In short, we believe it is reasonable to infer the Legislature and IWC wanted to be more protective of employees who worked longer shifts and for that reason spelled out in detail what is required to waive a right to a meal break for shifts over eight hours for health care employees and over 12 hours for all other covered employees. But it does not follow that when employees work fewer hours, here between five and six hours, that there was also an intent to prohibit a prospective written waiver.”

Plaintiffs relied heavily on their reading of Brinker. In their view, Brinker, supra, 53 Cal.4th 1004, interpreted the same meal period waiver provisions at issue in this case and supports their reading of the statute and wage orders. In Brinker, the California Supreme Court considered, as relevant here, “(1) the nature of an employer’s duty to provide employees with meal periods; and (2) the timing requirements applicable to the provision of meal periods.”

However “Brinker did not address the requirements for the waiver of rest breaks. (See Brinker, at p. 1033.) For these reasons, we do not find Plaintiffs’ reading of this passage from Brinker persuasive.”

In Cunningham et al. v. Cornell University et al., the plaintiffs, a class of over 30,000 current and former Cornell University employees enrolled in two 403(b) retirement plans, alleged violations of the Employee Retirement Income Security Act of 1974 (ERISA). The plaintiffs, led by Casey Cunningham, claimed that Cornell University and its fiduciaries breached their fiduciary duties under ERISA by mismanaging the retirement plans, which held nearly $3.4 billion in net assets.

They alleged Cornell engaged in prohibited transactions – (ERISA § 1106(a)(1)(C)) – by paying excessive fees to the plans’ service providers, specifically Teachers Insurance and Annuity Association of America (TIAA-CREF) and Fidelity Investments, for record keeping and investment management services. These payments were alleged to violate ERISA’s prohibition on transactions between the plan and a “party in interest” (e.g., service providers), as the fees were deemed unreasonable and not justified by the services provided.

The plaintiffs argued that merely alleging a transaction with a party in interest was sufficient to state a claim under ERISA § 1106(a)(1)(C), and that exemptions under § 1108(b)(2) (allowing reasonable and necessary services) were affirmative defenses that Cornell had to prove.

Cornell University, along with its appointed fiduciaries, denied the allegations and argued that the plaintiffs failed to meet the legal threshold for their claims.

Cornell maintained that the plaintiffs’ allegations were insufficient to state a claim under ERISA § 1106(a)(1)(C). They argued that plaintiffs needed to plead specific facts showing that the transactions were unnecessary or involved unreasonable compensation, not just that a transaction occurred with a party in interest.

The university contended that ERISA § 1106(a) must be read in conjunction with § 1108 exemptions, which permit reasonable and necessary transactions (e.g., for recordkeeping services). Cornell argued that these exemptions are integral to the claim’s elements, not merely affirmative defenses.

They asserted that the recordkeeping services provided by TIAA-CREF and Fidelity were standard, necessary for plan operations, and that the fees were not excessive when viewed in the context of the services’ quality and market st

The lawsuit was filed in 2016 in the U.S. District Court for the Southern District of New York, which dismissed the prohibited transaction claims and granted summary judgment to Cornell on most fiduciary duty claims, finding that the plaintiffs failed to show loss or provide sufficient evidence of imprudence.

The Second Circuit affirmed in 2023, holding that plaintiffs must plead that the transactions were unnecessary or involved unreasonable compensation to survive a motion to dismiss, effectively incorporating § 1108 exemptions into the pleading requirements for § 1106(a) claims.

The Supreme Court granted certiorari to resolve a circuit split on the pleading standard for prohibited transaction claims, with the plaintiffs arguing that the Second Circuit’s approach improperly shifted the burden to them to negate exemptions, while Cornell defended the ruling as necessary to prevent baseless lawsuits.

On April 17, 2025, the Supreme Court unanimously reversed the Second Circuit (U.S. Supreme Court, No. 23-1007, decided April 17, 2025), holding that to state a claim under ERISA § 1106(a)(1)(C), plaintiffs need only allege the elements of the provision itself (i.e., a transaction with a party in interest) without addressing potential § 1108 exemptions. The Court clarified that § 1108 exemptions are affirmative defenses, which defendants must raise and prove. The case was remanded for further proceedings consistent with this ruling.

Braulio Ruvalcaba was employed by Santa Cruz City Schools as a custodian. In 2016, he suffered a back injury on the job. Keenan & Associates was the District’s workers’ compensation claims administrator.He returned to work with basic accommodations and was able to perform essential job duties for nine months. However on January 9, 2018 the District terminated his employment.

On March 30, 2020, Ruvalcaba filed his First Amended in Complaint Santa Cruz Superior Court (19-CV-00488) against Santa Cruz City Schools and Keenan and Associates alleging (1) disability discrimination under California Government Code (“Gov. Code”) § 12940(a); (2) failure to accommodate under Gov. Code § 12940(m); (3) failure to engage in a good-faith interactive process under Gov. Code § 12940(n); (4) failure to prevent discrimination under Gov. Code § 12940(k) (against the District only); and (5) wrongful termination in violation of public policy.

The plaintiff alleged that Keenan provided misleading information to the District, leading to the mistaken belief that Ruvalcaba was too injured to continue working. Specifically Keenan allegedly instructed the District to disregard medical information not provided by Keenan itself. And Keenan allegedly withheld medical reports that would have shown Ruvalcaba’s ability to perform his job, even without accommodations. This conduct was claimed to have aided, abetted, incited, coerced, or compelled the District’s failure to accommodate and wrongful termination.

According to media information, Keenan conceded that it failed to transmit accurate medical information to the District, it claimed these were innocent mistakes and oversights rather than intentional efforts to discriminate against plaintiff or get him fired. Keenan claimed that the District was solely responsible for the decision to terminate plaintiff and its refusal to rehire him, and that it was not appropriate for the District to blame Keenan for those decisions.

The jury trial lasted 17 days. They returned verdicts against Keenan on May 23 and May 24, 2022. The verdict against Keenan totaled $6,908,000 for compensatory itemized damages related to emotional distress and $27,600,000 in punitive damages.The total verdict amounted to $34,508,000 against Keenan, with the District also liable for portions of the noneconomic damages.

AP Keenan is a division of Assured Partners, Inc., the eleventh largest insurance broker in the United States and a company with more than $1.6 billion in annual revenues according to its own website. Ironshore Indemnity issued Excess Financial Institutions Professional Liability policy to Assured Partners, for the policy period October 1, 2019 to October 1, 2020. It followed Insurance Agents and Brokers Professional Liability Policy issued by Allied World Insurance Company (“Allied”), for the policy period October 1, 2019 to October 1, 2020, with limits of $15,000,000. The MAIC Policy provides excess coverage over the followed policy with an aggregate limit in the amount of $10,000,000 excess of $15,000,000. The Ironshore Indemnity Policy provides an aggregate limit of $10,000,000 excess of the total $25,000,000 limits of the Followed Policy and the MAIC Policy.

Ironshore is a subsidiary of Liberty Mutual Insurance Company. Its lawsuit Ironshore Indemnity, Inc. v. Keenan & Associates (Case No. 2:25-cv-03310) was filed on April 15, 2025 in the United States District Court for the Central District of California, and it is a declaratory judgment action asking the court to determine whether it has a duty to defend or indemnify Keenan for the Ruvalcaba judgment.

Ironshore asserts that California Insurance Code Section 533, prohibits insurers from covering losses caused by an insured’s willful acts. The lawsuit points to the Ruvalcaba jury’s findings and answers to questions required for the verdict. And Ironshore claims these findings support that Keenan intentionally conspired with the school district and acted with “willful, malicious, and oppressive” conduct. Ironshore asserts that both the compensatory and punitive damages fell outside its policy’s coverage. The company also noted that its policy followed the terms of the Allied World policy, which excluded amounts uninsurable under applicable law, further reinforcing its stance.

The Ruvalcaba case, and its aftermath, is highly significant to the California workers’ compensation industry. The California Labor Code section 3762, along with related regulations and privacy laws, impose specific restrictions on the release of medical reports by a workers’ compensation claims administrator to the employer involved in the claim. However, these restrictions are nuanced and depend on the context, the purpose of the disclosure, and compliance with privacy laws such as the California Confidentiality of Medical Information Act (CMIA) and federal regulations like the Health Insurance Portability and Accountability Act (HIPAA).

Specifically the claims administrator is authorized to release “Medical information regarding the injury for which workers’ compensation is claimed that is necessary for the employer to have in order for the employer to modify the employee’s work duties.” Otherwise they “are prohibited from disclosing or causing to be disclosed to an employer, any medical information, as defined in Section 56.05 of the Civil Code, about an employee who has filed a workers’ compensation claim.”

In light of the above, some may argue that fine line exists between the juxtaposition of what a claims administrator must release to avoid liability such as what happened in the Ruvalcaba case, or legal liability for disclosing what might be argued as protected medical information that should not have been disclosed. And there seems to be little guidance on use on a case by case basis, especially in cases that contain perhaps hundreds of pages of narrative medical information.

A Hearst Newspapers investigation, published on April 16, 2025, revealed that surgeons across the United States have inadvertently left surgical materials – such as sponges, wires, needles, drill bits, instruments, and broken tool fragments – inside patients’ bodies over the past decade. The full article is available on Hearst Newspapers’ platforms, such as the San Francisco Chronicle or Houston Chronicle

These incidents, known as retained surgical items (RSIs) or “never events,” are rare but can have severe consequences, including infections, organ damage, additional surgeries, and, in extreme cases, death. The investigation, conducted by reporters Emilie Munson and Leila Merrill, highlights the persistence of these medical errors despite protocols designed to prevent them, such as mandatory counting of surgical items and the use of radiopaque sponges visible on X-rays.

While exact numbers vary due to underreporting, studies cited in related sources estimate RSIs occur in approximately 1 in every 5,500 surgical procedures, with around 1,500 cases annually in the U.S. The Hearst investigation emphasizes that these incidents often require additional surgeries, extend hospital stays, and cause significant patient harm, such as infections, abscesses, or organ damage. For example, retained sponges, which account for 48% to 69% of RSIs, can lead to “gossypiboma,” where the body forms a mass around the foreign object, causing pain or complications like fistulas or bowel obstructions.

The investigation notes a range of items left behind, including:

– – Surgical sponges and gauze (most common, often used in large quantities during procedures).
– – Needles, wires, and drill bits.
– – Surgical instruments like clamps or retractors.
– – Broken fragments of tools, such as catheter tips or parts of wire cutters.These items are typically left in the abdomen, pelvis, or chest, but cases have been reported in vaginas, spinal canals, and even brains

The investigation points to human error as a primary cause, often due to:

– – Inaccurate manual counting of surgical items, which can be disrupted by complex procedures, shift changes, or distractions.
– – Poor communication among surgical teams.
– – Complacency or overconfidence in counts reported as correct, even when items are missing.
– – Inadequate documentation or failure to follow protocols like the World Health Organization’s surgical safety checklist.

The investigation references specific cases to illustrate the human toll:

– – A 2021 case where a woman suffered for 18 months after a plastic wound retractor (the size of a dinner plate) was left inside her abdomen following a C-section. An abdominal CT scan eventually
– – A 2018 case in Japan where a woman experienced abdominal bloating for six years due to two gauze sponges left during a C-section, which had adhered to her connective tissue and colon
– – A California man who suffered infections and septic shock from two retained surgical clamps, leading to a stroke.

The investigation underscores systemic challenges, including:

– – Underreporting of RSIs due to inconsistent definitions, varying reporting requirements, and fear of litigation.
– – Limitations of manual counting processes, which are prone to error in high-stress, complex surgeries, especially those involving obese patients or trauma cases requiring numerous instruments
– – Resistance to adopting new technologies, such as RFID-tagged sponges or barcode systems, due to cost or integration challenges, despite their potential to reduce errors.
– – RSIs lead to significant costs for hospitals, with a single case potentially costing up to $600,000 due to corrective surgeries and legal fees. Malpractice claims are common, with a 2003 study noting an average of $52,000 in compensation and legal expenses per case.

Hospitals employ several strategies to prevent RSIs, including:

– – Surgical teams count sponges, instruments, and other items before and after procedures. However, studies show that counts are often recorded as correct even when items are left behind.
– – Sponges and some instruments are embedded with X-ray-detectable materials to aid identification if left inside a patient.
– – The WHO surgical safety checklist and National Safety Standards for Invasive Procedures aim to standardize safety checks, but compliance varies.
– – Systems like ORLocate’s Surgical Counting and Detection System use RFID or barcode technology to track items more accurately, but adoption is not widespread.

Despite these measures, the investigation notes that errors persist due to the complexity of surgical environments, staff fatigue, and organizational pressures, such as high workloads or frequent staff changes during procedures.

The Hearst investigation aligns with prior studies and reports highlighting RSIs as a persistent patient safety issue. For instance, a 2008 study at the Mayo Clinic found RSIs in 1 in 5,500 surgeries, with most counts incorrectly reported as accurate. A 2017 article from the National Center for Biotechnology Information (NCBI) notes that RSIs can be life-threatening, often requiring further operations. The investigation also reflects Hearst Newspapers’ history of award-winning investigative journalism, as seen in their Polk Awards for reporting by the San Antonio Express-News and San Francisco Chronicle.

Discover Magazine on RSIs discusses real-world cases, such as the 2021 C-section retractor case and the 2018 Japanese gauze case, with broader implications. Washington Post on Never Events Reports 4,857 objects left in patients over two decades, with insights into malpractice claims and systemic issues. Times Union on New York Cases details specific RSI incidents, including a surgical sponge missed during a hysterectomy due to incorrect counting. PSNet on RSI Epidemiology offers data from California’s reporting system (2007–2011), noting 58% of RSI cases involved sponges or towels. Minnesota Department of Health reports 270 retained objects since 2003, emphasizing sponges and clamps as common items.

Chester Taylor worked as a kosher food manager/inmate laborer for State of California, Department of Corrections Inmate Claims when he sustained an industrial injury to his bilateral arms on January 20, 2017.

The injury was resolved through a Stipulated Findings & Award on April 6, 2024, which provided him with a 76% permanent disability rating. The defendant, State Compensation Insurance Fund (SCIF), paid permanent disability benefits at a weekly rate of $160.00, totaling $49,406.39 through December 13, 2024.

Mr. Taylor filed a petition to commute his remaining permanent disability benefits into a lump sum, covering the period from December 13, 2024, for the remainder of his life expectancy.

At trial, he testified that his monthly income (from Social Security, workers’ compensation, and SNAP benefits) totaled $2,428.00, while his expenses (rent, food, medical copays, and dental expenses) amounted to $1,251.00. He claimed to be in arrears by $300.00 to $600.00 per month, borrowing approximately $600.00 per week from his daughter. However, he provided no documentary evidence to substantiate these figures.

The presiding Workers’ Compensation Administrative Law Judge (PWCJ) denied Mr. Taylor’s petition, finding that he failed to meet the burden of proof under Labor Code § 5100(a). The lack of documentary evidence supporting his financial claims and the unclear calculations of his expenses were critical factors.

The WCAB denied reconsideration in the panel decision of Chester Taylor vs. State of California, Department of Corrections Inmate Claims – ADJ13319691 (April 2025).

Under Labor Code § 5100(a), commutation of benefits is allowed if it is “necessary for the protection of the person entitled thereto, or for the best interest of the applicant.” Additionally, § 5100(b) requires that commutation must avoid inequity and not cause undue expense or hardship to the applicant.

The Workers’ Compensation Appeals Board (WCAB) has discretion to grant or deny commutation, and the applicant bears the burden of proving the necessity of commutation. (Hulse v. Workers’ Comp. Appeals Bd. (1976) 63 Cal.App.3d 221, 226 [41 Cal.Comp.Cases 691].)

The PWCJ also noted that commuting the benefits could potentially cause undue hardship, as Mr. Taylor’s current income, including permanent disability payments, was insufficient to cover his expenses. Commuting the benefits would reduce or eliminate this income stream, potentially exacerbating his financial difficulties.

The WCAB, in its Opinion and Order dated April 8, 2025, adopted and incorporated the PWCJ’s report and denied the Petition for Reconsideration, affirming the PWCJ’sdenial of commutation.

The WCAB noted that Mr. Taylor remains free to file a new petition for commutation if he can provide adequate evidence meeting the requirements of Labor Code § 5100(a) and (b).