Category: Daily News

While employed by Activor Corporation in 2007, Mahavir Mehta fell 12 feet off a ladder and sustained serious injuries, including one to his left wrist that required surgery. Activor did not carry workers’ compensation insurance and was not permissibly self-insured.

Mehta initiated workers’ compensation proceedings and sued Activor and the principle stockholder Chanda Zaveri for damages pursuant to Labor Code section 3706. The suit (Metha I) resulted in a judgment in plaintiff’s favor against Activor only in the total sum of $184,850.22, which included $129,850.22 in attorney fees. Through a writ of execution, plaintiff collected $55,000 from Activor.

After entry of the Mehta I judgment, Activor began transferring assets and accounts receivable to Chanda Zaveri and to Actiogen Corporation and Chanda LLC, two newly formed entities controlled by Zaveri. Activor subsequently initiated a “no asset” bankruptcy proceeding, omitting more than $900,000 accounts receivable due and owing to Activor.

In order to collect the outstanding attorney fee portion of the judgment, Mehta commenced this action (Mehta II) for compensatory and punitive damages against Activor, Zaveri, Actiogen, and Chanda based on common law and statutory fraudulent transfer theories.

The trial court awarded plaintiff compensatory damages of $207,760.35 and punitive damages of $621,781.05, for a total judgment of $829,041.40, plus interest, attorney fees and costs. There was no court reporter or live witness testimony. Instead, counsel stipulated the evidence would consist of deposition testimony and documents. The court of appeal modified but otherwise affirmed the judgment in the unpublished case of Mehta v Activor Corp.

On appeal defendants did not provide a settled statement or other suitable substitute. The clerk’s transcript was incomplete. Before any appellate briefs were filed, this court issued a briefing order, directing the parties to include in their briefs a discussion of the effect of defendants’ failure to provide most of the relevant papers as part of the record in an appendix. Defendants failed to heed the briefing order.

The court noted that where the appellate record is inadequate to permit us to assess whether the trial court has erred or the judgment is not supported by substantial evidence, it must affirm. A party on appeal has the duty to support the arguments in the briefs by appropriate reference to the record, which includes providing exact page citations. We have no duty to search the record for evidence and may disregard any factual contention not supported by proper citations to the record.

On appeal defendants contend the right to sue for the unpaid attorney fees portion is vested in plaintiff’s law firm, not plaintiff himself. Stated another way, defendants insist plaintiff is no longer a judgment creditor entitled to sue defendants for fraudulent transfers.

The Supreme Court acknowledged more than 80 years ago, a judgment for attorney fees belongs “to the party to the action for fees paid or incurred by him, and not directly to the attorney, who is not a party to the action.- (Los Angeles v. Knapp (1936) 7 Cal.2d 168, 173.).

The trial court found by clear and convincing evidence that all defendants entered into a fraudulent scheme.

President Donald Trump promised to bring down prescription drug prices on Monday, saying U.S. citizens pay far more than people in other countries do for the same product and that his administration would announce new measures in about a month.

“If you compare our drug prices to other countries in the world, in some cases it’s many times higher for the exact same pill or whatever it is, in the exact same package made in the exact same plant,” Trump said. “We’re going to change that.”

Trump made the remarks during a speech in Manchester, New Hampshire that focused on the administration’s efforts to battle the nation’s opioid addiction crisis. Trump said he planned a news conference in about a month to roll out drug price proposals.

“We’re driving ‘em down,” Trump said. “We pay as a country so much more for drugs because of the drugs lobbies and other reasons, and the complexity of distribution, which is basically another term for saying, ‘How do we get more money?’.”

His comments reflect growing scrutiny over what patients end up spending for their medicines after insurers, distributors, hospitals and pharmacies are paid for their roles in delivering the drugs. U.S. Food and Drug Administration Commissioner Scott Gottlieb recently criticized such players for “Kabuki drug-pricing” constructs that drive up prices for consumers.

On Monday, Health and Human Services Secretary Alex Azar said the new proposals will focus on “how we decrease the price of drugs and how we bring discounts that the middlemen right now are getting, how those will go to our patients.”

Azar, a former president of the U.S. arm of drugmaker Eli Lilly and Co, joined Trump at the New Hampshire event.

Trump has vowed since his election to tackle rising drug prices. His proposed 2019 budget outlined some steps to do so, including by allowing up to five states more flexibility over which drugs are covered by Medicaid, the government health insurance program for the poor and disabled.

That could give the states more leverage to negotiate lower prices for prescription medicines.

Trading volume in the ishares Nasdaq Biotechnology exchange-traded fund picked up as Trump began talking about drug prices, but the ETF’s price closed down about 2 percent.

Shares in pharmacy benefits managers Express Scripts Holding Co and CVS Health Corp closed down 4 percent and 3.1 percent, respectively.

Reporting by Roberta Rampton; Additional reporting by Yasmeen Abutaleb in Washington and Caroline Valetkevitch in New York; Writing by Doina Chiacu; Editing by Leslie Adler and James Dalgleish

Chinese researchers have developed an artificial intelligence system which can diagnose cancerous prostate samples as accurately as any pathologist, holding out the possibility of streamlining and eliminating variation in the process of cancer diagnosis.

The system may also help overcome shortages of trained pathologists and in the longer term lead to automated or partially-automated prostate diagnosis.

Confirmation of a prostate cancer diagnosis normally requires a biopsy sample to be examined by a pathologist. Now the Chinese AI system has shown similar levels of accuracy to pathologists and can also accurately classify the level of malignancy of the cancer, eliminating the variability which can creep into human diagnoses.

Details of the AI system were presented at the European Association of Urology Congress taking place in Copenhagen this March.

“This is not going to replace a human pathologist,” said Hongqian Guo, who led the research. “We still need an experienced pathologist to take responsibility for the final diagnosis. What it will do is help pathologists make better, faster diagnoses, as well as eliminating the day-to-day variation in judgment which can creep into human evaluations.”

Guo’s group took 918 prostate samples from 283 patients and ran these through the AI system, with the software gradually learning and improving diagnosis. The pathology images were subdivided into 40,000 smaller samples of which 30,000 were used to train the software while the remaining 10,000 were used to test accuracy.

The results showed an accurate diagnosis in 99.38 per cent of cases, using a human pathologist as a gold standard. Guo said that means the AI system is as accurate as a pathologist.

The system was programmed to learn and gradually improve how it interpreted the samples. “Our results show that the diagnoses the AI system reported were at a level comparable to that of a pathologist. Furthermore, the system could accurately classify the malignancy level of prostate cancer,” said Guo.

Until now, automated systems have had limited clinical value. “We believe this is the first automated system to offer an accurate reporting and diagnosis of prostate cancer. In the short-term, this can offer a faster throughput, plus a greater consistency in cancer diagnosis from pathologist to pathologist, hospital to hospital, country to country,” Guo said. “It is important that cancer detection and diagnosis takes advantage of these changes.”

“This is interesting work which shows how artificial intelligence will increasingly step into clinical practice,” said Rodolfo Montironi, professor of pathology, Polytechnic University of the Marche, Ancona, Italy. “This may be very useful in some areas where there is a lack of trained pathologists. Like all automation, this will lead to a lesser reliance on human expertise, but we need to ensure that the final decisions on treatment stay with a trained pathologist.”

Elizabeth Holmes raised hundreds of millions of dollars from investors on the promise that her California Silicon Valley based medical-testing startup Theranos Inc. would change medicine with a single drop of blood. Now securities regulators called her a fraud and forced her to give up the company she built.

Holmes began to rise to national attention in 2013 when she claimed that Theranos had developed a medical technology that could do what seemed impossible: Its secret machines could run thousands of medical tests using the blood from a tiny finger-prick, and do so quickly and cheaply.

High-profile board members joined as well — including the diplomat Henry Kissinger, James Mattis — now the Trump administration’s Secretary of Defense, and David Boies, the lawyer who tried to stop revelations about film producer Harvey Weinstein’s sexual harassment.

Holmes had claimed her machines could process 90 percent of the tests performed by standard lab equipment. Those statements won the company an agreement with a national pharmacy chain in 2010 even though the technology was not yet “commercially ready,” according to the SEC. Theranos publicly announced a partnership with the drugstore chain Walgreens, which later sued Theranos. The companies eventually settled.

The Securities and Exchange Commission charged Theranos Inc., its founder and CEO Elizabeth Holmes, and its former President Ramesh “Sunny” Balwani with raising more than $700 million from investors through an elaborate, years-long fraud in which they exaggerated or made false statements about the company’s technology, business, and financial performance.

The complaints allege that Theranos, Holmes, and Balwani made numerous false and misleading statements in investor presentations, product demonstrations, and media articles by which they deceived investors into believing that its key product – a portable blood analyzer – could conduct comprehensive blood tests from finger drops of blood, revolutionizing the blood testing industry.

In truth, according to the SEC’s complaint, Theranos’ proprietary analyzer could complete only a small number of tests, and the company conducted the vast majority of patient tests on modified and industry-standard commercial analyzers manufactured by others.

The complaints further charge that Theranos, Holmes, and Balwani claimed that Theranos’ products were deployed by the U.S. Department of Defense on the battlefield in Afghanistan and on medevac helicopters and that the company would generate more than $100 million in revenue in 2014. In truth, Theranos’ technology was never deployed by the U.S. Department of Defense and generated a little more than $100,000 in revenue from operations in 2014.

Theranos and Holmes have agreed to resolve the charges against them. Importantly, in addition to a penalty, Holmes has agreed to give up majority voting control over the company, as well as to a reduction of her equity which, combined with shares she previously returned, materially reduces her equity stake.

“The Theranos story is an important lesson for Silicon Valley,” said Jina Choi, Director of the SEC’s San Francisco Regional Office. “Innovators who seek to revolutionize and disrupt an industry must tell investors the truth about what their technology can do today, not just what they hope it might do someday.”

The co-owner of a Los Angeles drug and alcohol treatment facility pleaded guilty to 46 felony counts related to a $175 million fraudulent health care billing scheme.

Deputy District Attorney Shaun Gipson of the Healthcare Fraud Division said that Los Angeles County Superior Court Judge Charlaine Olmedo immediately sentenced Kirsten Wallace (dob 4/3/73) to 11 years in state prison,.

Wallace entered an open plea to five counts of insurance fraud, seven counts of grand theft of personal property, six counts of identity theft and 28 counts of money laundering. The open plea means a sentence was not negotiated with the District Attorney’s Office. A restitution hearing is scheduled for April 17 in Department 105 of the Foltz Criminal Justice Center.

Wallace and Christopher Bathum (dob 9/22/61), who together owned Community Recovery of Los Angeles, were charged in the billing scheme in November 2016. The company operated treatment centers in Southern California and Colorado.

Gipson said the two defendants allegedly obtained multiple health care insurance policies for their clients by using their personal identifying information and falsified the clients’ circumstances to obtain the policies. The patients were unaware that policies had been issued in their name, the prosecutor said.

Bathum and Wallace also are accused of billing former clients after their treatment ended while those clients were still working at Community Recovery and no longer receiving treatment. Between June 2012 and December 2015, Bathum and Wallace allegedly fraudulently billed an estimated $175 million, Gipson said.

In most instances, bills were sent for services allegedly never provided. About $44 million was paid out by five insurance companies, the prosecutor said.

Bathum is charged with the same 46 counts as Wallace had faced. His next scheduled court appearance is a pretrial conference also April 17 in Department 105.

Bathum faces up to 45 years and four months in state prison if convicted as charged.

Last month in a separate case, Bathum was convicted of sexually assaulting seven women who were patients at his treatment center. A sentencing setting hearing in that case is scheduled April 17 in Department 105. The defendant faces a maximum possible sentence of about 65 years in state prison and lifetime sex offender registration.

Case BA451664 was investigated by the California Department of Insurance and the District Attorney’s Office’s Bureau of Investigation.