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Floyd, Skeren and Kelly LLP Schedules Employment Law Conference

Floyd, Skeren and Kelly LLP is pleased to announce its 3rd Annual Employment Law Conference, which will feature keynote speaker Phyllis W. Cheng, Director of the California Department of Fair Employment and Housing (DFEH). The conference will be held on May 9, 2013 at the Disneyland Hotel.

This is an all-day event, designed for employers, supervisors, managers, claims adjusters, risk managers, and any other professionals associated with human resources and employment law. The conference will focus on the latest employment law cases, most recent legislation, and provide helpful practical guidance related to numerous workplace topics, including: the new California disability regulations (which impact an employer’s policies and procedures on reasonable accommodation, the interactive process and medical certifications); an overview of important OSHA workplace requirements; a review of 10 critical steps an employer can take to stay out of court and avoid costly and time consuming employment related lawsuits; a workers’ compensation case law and legislative update; helpful guidance on preventing workers’ compensation fraud; a review of the new comprehensive pregnancy disability regulations now in effect; and, an update on the evolving role of social media in the workplace.

Cost of attendance is $120.00

Discounted room rates at the Disneyland Hotel and discounted Disneyland tickets are available for attendees and their guests. Upon registration this information will be provided to you.

Please visit for more details and online registration. You can also contact Christina Bardelli by phone (818) 854-3239 or, email

Court of Appeal Expands Employee Privacy Rights

Yum! Brands is the corporate parent of several fast food franchises, such as Taco Bell, Pizza Hut, and KFC (formerly known as Kentucky Fried Chicken). Yum employed Melissa Ignat between 2005 and 2008 in the Yum Real Estate Title Department, located in Irvine. She assisted paralegals in the department with securing title to the real estate on which Yum’s franchised stores conducted business.

Ignat suffered from bipolar disorder, for which she was being treated with medications. Sometimes these were effective, sometimes not. Side effects of medication adjustments occasionally forced Ignat to miss work. Ignat alleged that after returning from one such absence in mid-2008, her supervisor, Mary Shipma informed her that she had told everyone in the department Ignat was bipolar. Ignat alleged her coworkers subsequently avoided and shunned her, and one of them asked Shipma if Ignat was likely to “go postal” at work.

Ignat was terminated in early September 2008. She filed suit against Yum! Brands and Shipma on November 12, 2008, alleging one cause of action for invasion of privacy by public disclosure of private facts. The trial court granted summary judgment in favor of the employer. Summary judgment was ordered on the ground that the right of privacy can be violated only by a writing, not by word of mouth. Because Ignat had not produced any document disclosing private facts, she could not pursue this cause of action. The trial court lamented the “irrationality” of this rule, but felt itself bound by precedent.

Ignat appealed. The Court of Appeal reversed in the published opinion of Ignat v Yum! Brands Inc.

In reviewing the case law the Court of Appeal noted that the “rule” requiring a written publication as an element of a public disclosure of private facts privacy claim in California originated in dictum in Melvin v. Reid (1931) 112 Cal.App. 285 – which lacked support in the case law on which it was based – an opinion that rejected the tort and all its principles, instead basing its holding on another principle entirely. It was followed by two cases from the 1960’s.(Gautier v. General Telephone Co., supra, 234 Cal.App.2d at p. 303; Grimes v. Carter, supra, 241 Cal.App.2d at pp. 698-699.) With these two exceptions, restricting privacy violations to written publications has been either roundly criticized or ignored by the courts dealing with disclosure of private facts in oral statements since the principle was first enunciated, in dictum, in Melvin . The Court of Appeal concluded that “This is not a firm foundation for a ruling dismissing a cause of action”.

The Court concluded “that limiting liability for public disclosure of private facts to those recorded in a writing is contrary to the tort’s purpose, which has been since its inception to allow a person to control the kind of information about himself made available to the public – in essence, to define his public persona. (See Briscoe, supra, 4 Cal.3d at p. 534; The Right to Privacy, supra, 4 Harv. L.Rev. at pp. 198-199.) While this restriction may have made sense in the 1890’s – when no one dreamed of talk radio or confessional television – it certainly makes no sense now. Private facts can be just as widely disclosed – if not more so – through oral media as through written ones. To allow a plaintiff redress for one kind of disclosure but not the other, when both can be equally damaging to privacy, is a rule better suited to an era when the town crier was the principal purveyor of news. It is long past time to discard this outmoded rule.”

Operators of Leasing Company Charged in $1.7 Million Fraud Case

A Corona man and his daughter who have been charged with taking more than $1.7 million in what officials say was a workers’ compensation fraud scheme have pleaded not guilty.The Press-Enterprise reports that Antonio Torres Arias, 47, and Nayeli Iliana Torres, 22, each pleaded not guilty during their Thursday, March 14, arraignment in the downtown Riverside Hall of Justice courthouse. Their next court date is April 4. Jail records showed Torres is out of custody; Arias remained in jail early Thursday evening on $1.7 million bail.

Investigators said the defendants operated several companies that leased employees to the Cardenas Markets supermarket chain. There is no information that Cardenas Markets was involved in any of the alleged wrongdoing, a news release from the district attorney’s office said.

Arias and Torres are each charged with five felonies – four counts of misrepresentation to obtain workers’ compensation insurance and one count of tax evasion. If convicted as charged, each could face up to 16 years in prison. Arias and Torres conducted the alleged fraud to reduce the amount of premiums owed for workers’ compensation insurance. They used “cash pay” employees, misclassified employee jobs, and concealed the history of employees’ workplace injuries as far back as 2009, prosecutors said.

Two of the defendants’ companies included Torres Services and Torres Cleaning. The companies that authorities say were wronged in the case include First Comp Insurance, Chartis Insurance, National Fire Insurance and the state Employment Development Department.

The case was investigated for about nine months by a task force that includes the Riverside County District Attorney’s office and the California Department of Insurance. Authorities were alerted to the case by investigators from First Comp Insurance. The case is being prosecuted by Deputy District Attorney Michael Mayman, of the office’s Insurance Fraud Unit of the Special Prosecution Section.

WCAB Panel Dismisses Liens For Late Payment of Activation Fees

S.B. 863 requires lien claimants to pay an activation fee prior to attending a lien conference, and a filing fee for filing new liens. The panel decision in the case of Jose Pedro Soto v Marathon Industries Inc. held that lien claims are properly dismissed when the activation fee is paid a few hours late.

Jose Pedro Soto claimed to have sustained industrial injuries to his back. He settled his cases by Compromise and Release approved by Order Approving Compromise and Release dated September 6, 2012. On November 29, 2012, defendant filed a Declaration of Readiness to Proceed requesting a lien conference. A lien conference was scheduled for January 10, 2013.

After passage of S.B. 863, Labor Code Section 4903.06(a)(4), effective January 1, 2013, provides: “All lien claimants that did not file the declaration or readiness to proceed and that remain a lien claimant at the time of a lien conference shall submit proof of payment of the activation fee at the lien conference. If the fee has not been paid or no proof of payment is available, the lien shall be dismissed with prejudice.”

Administrative Director Rule 10208(a), operative January 1, 2013, provides in relevant part: “No lien claimant that is required to pay an activation fee shall file a declaration or readiness or participate in any lien conference including obtaining an order allowing its lien in whole or in part, without submitting written proof of prior timely payment of the fee, or without electronic proof of timely payment of the fee that is available to the judge and parties at the conference. ‘Prior timely payment’ means payment of the activation fee (1) prior to the filing of a declaration filing a declaration of readiness, or (2) prior to an appearance at a lien conference by a lien claimant of record that did not file the declaration of readiness.”

The lien conference was scheduled for 8:30 a.m. The lien claimants in that case paid the activation fee between 10:56 and 11:06 a.m. on that day. Pursuant to Rule 10208(a), payments of the fees were not “prior timely payments.” In order to have been “prior timely payments,” the payments would have had to be made prior to 8:30 a.m. on the date of the lien conference. Therefore, the liens were properly dismissed at the lien conference on January 10, 2013.

The WCAB reinstated the Orders Dismissing Liens of Pacific Orthopedic and Rehabilitation, Vanguard Psychiatric, National Duramed, LA Mediwave, Inc., Westside Wilshire Medical Center, Orthopedic Rehabilitation of San Fernando Valley, Marina Russman, M.D., Jan Medical Equipment, Healthcare Interpreting, and Global Interpreting dated January 10, 2013.

WCAB Rescinds Order to Pay for Medical Marijuana

In the case of Christopher Cockrell v Farmers Insurance a June 20, 2012 Findings and Award ordered reimbursement “for self-procured medically recommended marijuana as opposed to providing or paying a supplier of this drug is awarded in a sum not to exceed the lower of the fee schedule for medications being replaced by the medical cannabis or the actual expense of the self-procured item.”

The defendant filed a Petition for Reconsideration contending that the WCJ erred in finding that applicant was entitled to reimbursement for self-procured medical marijuana.

The WCAB Noted that neither the parties nor the WCJ considered the application of Health and Safety Code section 11362.785(d), which states that “Nothing in this article [Medical Marijuana Program] shall require a governmental, private, or any other health insurance provider or health care service plan to be liable for any claim for reimbursement for the medical use of marijuana.” (See also Lab. Code, §§ 4600.35 et seq.)

For that reason, the WCAB granted reconsideration, rescinded the Findings and Award of June 20,2012, and returned the matter to the trial level for further proceedings to consider application of Health and Safety Code section 11362. 785( d) to this matter.

CWCI Says MPN Physicians Now Provide 80% of Care

Treatment by network physicians is becoming increasingly prevalent in California workers’ compensation, with new data showing that nearly 80 percent of first-year physician-based outpatient medical services for 2010 California work injuries was provided by physicians who are part of a medical network – up from just over half of the services in 2004 – a trend that has grown steadily since 2004 legislative reforms extended medical control for employers that offer Medical Provider Networks.

Looking at first-year medical service data from more than one million claims for California work injuries occurring between 2004 and the third quarter of 2011, the authors calculated and compared the percentage of injured worker outpatient treatment visits to network providers before and after MPNs began operating in January 2005. The results show that the use of network providers for first-year physician services increased from 51 percent for 2004 work injuries to nearly 2/3 of the services for 2005 injuries – indicating an initial surge as first-year treatment shifted to MPNs. The latest figures confirm that the trend has continued, with networks accounting for 8 out of 10 physician-based services for 2010 injuries.

Prior to MPNs, employers usually controlled their injured workers’ treatment for 30 days after the injury, but with the advent of MPNs, medical control was extended to the life of the claim for employers that offered these networks. To determine how much of the increase in first-year network physician use is associated with the expansion of employer medical control, the study measured changes in the percentage of services by network providers within and beyond 30 days of injury. For pre-MPN (accident year 2004) claims, network providers rendered about 70 percent of physician-based outpatient medical services in the first 30 days post injury, while the latest data (claims for injuries from the first three quarters of 2011) show that rate is now 86.5 percent. At the same time, however, the network provider utilization for services beyond 30 days post-injury has nearly doubled from around 39 percent for AY 2004 claims to about 76 percent for AY 2010 claims, suggesting that the expansion of medical control under MPNs has been the primary factor behind the growing use of network providers in California worker’s compensation.

The research also shows that overall, the increasing share of first-year treatment payments to network providers has tracked with the growth in utilization. Payments to network providers rose from less than 40 percent of total reimbursements for first-year visits for 2004 injuries to nearly 54 percent for 2005 injuries, then continued to trend up, increasing to nearly 72 percent of the payments for first-year services for 2010 injuries.

Again, this growth was primarily driven by payments to network providers for services after the first 30 days, which more than doubled from less than 32 percent of the payments on AY 2004 claims, to more than 67 percent of the payments for AY 2010 claims.

The Institute has published the results of the study in a Research Update, which includes data tables showing AY 2004 – 3Q2011 network provider utilization rates and the proportion of payments for physician-based treatment within and beyond 30 days of injury. Results are also broken out separately for three major treatment categories: Evaluation and Management; Surgery Services (excluding injections); and Physical Therapy.

Man Sentenced For California Physician Identity Theft

Khoren Gasparian, 30, an Armenian national, was sentenced by Chief United States District Court Judge Lisa Godbey Wood to 41 months in prison for his role in a conspiracy to defraud Medicare through phony medical businesses in Savannah, Georgia. Gasparian, who at the time of these offenses was in the United States on an expired visa from Armenia, previously pleaded guilty to a conspiracy to defraud Medicare. According to the evidence presented at Gasparian’s guilty plea and sentencing hearings:

From 2008 through 2010, Gasparian and others opened medical equipment companies in Savannah, Georgia, known as Healthy Family, SOJ Group, and Savana Medical. Once opened, Gasparian and his cohorts stole the identities of hundreds of Medicare beneficiaries; stole the identities of dozens of doctors; and used this stolen information to submit hundreds of thousands of dollars in phony claims to Medicare for health care services that were never provided. Gasparian and others used the stolen identities of doctors and patients from multiple different states, including Alaska, California, New York, and Ohio and even submitted claims for people that were dead at the time they were alleged to have been provided medical equipment. Gasparian was also connected with at least two other phony health care businesses located in California and New Mexico. He was responsible for approximately $1 million worth of fraudulent claims submitted to Medicare.

In addition to being sentenced to 41 months in prison, Gasparian was ordered to pay restitution in the amount of $182,735 and to serve three years of supervised release upon completion of his prison sentence. There is no parole in the federal system. At the time of his guilty plea in Georgia, Gasparian was serving a prison sentence based on his guilty plea to a health care fraud offense in the United States District Court for the District of New Mexico. After Gasparian finishes serving his prison sentences, he will face immigration proceedings that will likely result in his deportation to Armenia.

The prosecution of Gasparian in the Southern District of Georgia is part of a multi-jurisdictional investigation involving more than $200 million worth of phony claims submitted to Medicare. More than 35 defendants were arrested as part of this investigation. In addition to the Southern District of Georgia, numerous charges were filed in New York, Los Angeles, Cleveland, and Albuquerque.

The investigation in the Southern District of Georgia was the result of a multi-agency team of federal, state, and local agents, led by the Federal Bureau of Investigation (FBI), the Department of Health and Human Services-Office of the Inspector General (HHS/OIG), and Immigration and Customs Enforcement (ICE), working together to combat health care fraud. Assistant United States Attorney Brian T. Rafferty prosecuted the case on behalf of the United States. For additional information, please contact First Assistant United States Attorney James D. Durham at (912) 201-2547.

Court Must Made Independent Determination of Injured Peace Officer Retirement Claim

Thomas Alberda began work as a full-time Fresno County deputy sheriff in 1993. Before his employment, Alberda had two surgeries on his right knee: The first, in 1981, was to repair damage he sustained when he dislocated his right knee while playing high school basketball; the second, in 1984, was to remove a chip in the right knee which occurred while playing basketball. The knee did not require ongoing treatment; Alberda passed his Fresno County pre-employment physical as well as the physical requirements of the law enforcement academy.

In May 1995, Alberda hyper-extended his right leg while on duty, causing an internal derangement that required surgery, which Malcolm E. Ghazal, M.D. performed that month. Before the surgery, Dr. Ghazal advised Alberda that while the surgery would relieve his immediate symptoms, he had underlying arthritis in his knee which would continue to worsen with time and eventually could require a significant surgical procedure. Dr. Ghazal, however, hoped such a surgery could be deferred for “many years to come.” In August 1995, Alberda returned to full duty without restriction.

Sometime in 2003, Alberda, who is six feet, seven inches tall, was assigned a smaller patrol vehicle in which he did not comfortably fit; while he could work, his knees were crammed into the dashboard. After about a year, he began having severe problems with both knees and was in continual pain. He stopped working in June 2005 due to the pain in his knees and sought treatment from Marc Johnson, M.D. Orthopedic surgeon Ronald R. Castonguay, M.D. performed surgeries to repair meniscus tears on both of Alberda’s knees: the first, on September 16, 2005, was on his right knee, and the second, on October 28, 2005, was on his left knee. Alberda did not recall any specific injury to his left knee during his career, although he recalled an instance in 2001 in which he went to the hospital after he had “gone down hard” on the left knee while arresting a suspect. He thought a report of the incident had been prepared, but one was never located.

In March 2007, Alberda filed an application for a service-connected disability retirement. On April 4, 2008, the Board denied the application and instead approved the grant of a non-service connected disability retirement if Alberda wished to apply for one. Alberda submitted a request for a hearing on the Board’s decision, which was held on March 8, 2010.

The hearing officer found that Alberda’s permanent incapacity was not the result of injury or disease arising out of and in the course of his employment, and that his employment did not contribute substantially to his disability concluding that “[Alberda] had a lot of degenerative problems and it is reluctantly concluded that it is those problems and not the 1995 trauma and the 2003 assignment that led to his 2005 incapacity. The preponderance of the evidence does not establish that [Alberda]’s employment contributed substantially to his permanent incapacity. The causal connection between the job and the disability must be real and measurable and substantial and such is not found to be the case herein.”

The Superior Court affirmed the hearing officer stating “the standard of review was independent judgment, in which the trial court must afford a strong presumption of correctness concerning the administrative findings and the party challenging the administrative decision bears the burden of convincing the court the findings are contrary to the weight of the evidence.”

The Court of Appeal in the published opinion of Thomas Alberta v Board of Retirement of Fresno County Employees’ Retirement Association reversed and remanded the case.

Instead of undertaking an independent determination of whether Alberda’s disability was service-connected, the trial court denied the petition after concluding substantial evidence supported the hearing officer’s finding on that issue.

“The trial court’s written order demonstrated it did not review the Board’s decision in the required manner. While the trial court began the statement of decision by stating the correct standard of review, i.e. independent judgment, it went on to say that “substantial evidence supports the hearing officer’s decision” that Alberda was not entitled to service-connected disability retirement benefits, that “substantial evidence supports” that the 1995 injury and the 2003 assignment to a smaller squad car did not contribute substantially to Alberda’s incapacity, and “[s]ubstantial evidence supports the hearing officer’s finding” that Alberda’s degenerative problems led to his disability.

Napa Vineyard Worker Jailed in Fraud Case

A 24-year-old vineyard worker was sentenced March 7 in Napa County Superior Court to 45 days in jail for falsely claiming he had broken his hand during a fall at work, according to the Napa County District Attorney’s Office. He was also ordered to pay $1,279 in restitution.

In February 2012, Ivan Ruiz-Hernandez, of Clearlake, had sought medical treatment and reported the incident to his employer, St. Supery Vineyards and Winery, as a job-related injury, authorities said. But investigators found Ruiz-Hernandez had injured himself during a physical fight weeks earlier, according to the Napa County District Attorney’s Office and court records.

The California Department of Insurance reported the incident to the Napa County District Attorney’s Office in June 2012.

Ruiz-Hernandez was arrested Feb. 20 on suspicion of workers’ compensation fraud, according to the Napa County District Attorney’s Office.

On March 7, Ruiz-Hernandez was convicted and sentenced for misdemeanor violations of insurance fraud and making false statements to obtain compensation under a plea agreement reached with the prosecution, according to court records.

Medical Board Fails to Monitor Surgical Centers

The Medical Board of California has largely failed to implement key provisions of a law intended, in part, to provide consumers with better information about physician-owned, outpatient surgery centers according to the article on the Public Radio (KPCC) website. Senate Bill 100 requires the Medical Board of California to “obtain and maintain” a list of accredited outpatient settings, including the names of all doctor-owners and their medical license numbers. The board must post that information on its website, which must also note whether a facility has had its accreditation suspended or revoked. But the medical board has yet to fully implement those provisions, which became law on Jan, 1, 2012. The information is not only hard to locate on the medical board’s site, but that contains a jumble of mostly incomplete records that provide little value to the public.

KPCC reviewed 100 surgery centers listed on the site; only 14 included the name of a doctor-owner, and only five provided the doctor-owner medical license number as required by California Health and Safety Code Section 1248.2 (b). Also missing from most of the records listed was information on whether a surgery center had its accreditation suspended or revoked. Consumers Union also reviewed the listing of surgery centers on the medical board’s website, and got similar results.

“Of the first 25 that came up, 18 of them did not have the name of the doctor who owned it, which is a pretty critical piece of information for consumers and for any kind of accountability,” said Lisa McGiffert, director of Consumer Union’s Safe Patient Project, a national campaign that for the past year has focused on oversight of California’s physician-owned surgery centers.

“This is an absolute failure to comply,” said Los Angeles consumer attorney Kathryn Trepinski, who testified in Sacramento last year on behalf of SB100. Trepinski represents Betty Brown of Torrance, whose sister died in December 2010, three days after undergoing lap-band weight-loss surgery at a physician-owned surgery center in Beverly Hills owned by brothers Michael and Julian Omidi. The Omidis were behind the once-popular 1-800-GET-THIN campaign. Brown has filed a wrongful death lawsuit against the Omidis.Trepinski said she was disturbed to find the website listing for the clinic did not mention the Omidis or any other owners. Without such information, she says, consumers checking out the center may be hard-pressed to learn that the medical board revoked Julian Omidi’s license to practice in 2007 and suspended Michael’s Omidi’s license in 2008, for three years.”People need to know the identities of physicians who own and run these centers so they can check their disciplinary records and their backgrounds,” she said. “This is a key part of patient safety and it’s important public health information.”

In an interview with KPCC, Medical Board of California Executive Director Linda Whitney acknowledged the website is incomplete and problematic. “It’s not the most consumer-friendly, I do admit that,” said Whitney, who noted that the agency is currently carrying out an agency-wide overhaul of its computer system. “So, unfortunately, it has not been the highest priority to refine that website. In the coming year we hope to make it much more consumer friendly,” she said.

Whitney said the website doesn’t have a complete list of surgery centers because her board told accrediting agencies that they don’t have to provide the data on a particular facility until its accreditation comes up for renewal. The agencies hadn’t collected owner information before, so this approach was designed to give them time to figure out best how to get it, she said. But because surgery centers’ accreditation comes up for renewal only once every three years, some of the information won’t get to the medical board – or consumers – until 2015.

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