Category: Daily News

A Petition for Disqualification of a Workers Compensation Judge was filed with the WCAB by an applicant attorney in a pending case. The basis of the Petition was that the WCJ expressed “an opinion regarding a legal or factual issue” during the course of the proceedings and before the case was litigated and resolved.

However the petitioner failed to “show that this opinion is a fixed one that could not be changed upon the production of evidence and the presentation of arguments at or after further hearing.”

After filing the Petition for Disqualification, but prior to any decision by the WCAB, a different WCJ approved a Compromise and Release between the parties. Once the issue in a petition is moot, or if the case is resolved in its entirety, the petition is subject to dismissal. Nonetheless, the WCAB went on to discuss the merits and then denied the Petition in the case of John Guy v AV Decking – ADJ9709184 (May 2025).

Labor Code section 5311 provides that a party may seek to disqualify a WCJ upon any one or more of the grounds specified in Code of Civil Procedure section 641. (Lab. Code, § 5311; see also Code Civ. Proc., § 641.) Among the grounds for disqualification under section 641 are that the WCJ has “formed or expressed an unqualified opinion or belief as to the merits of the action” (Code Civ. Proc., § 641(f)) or that the WCJ has demonstrated “[t]he existence of a state of mind … evincing enmity against or bias toward either party” (Code Civ. Proc., § 641(g)).

Under WCAB Rule 10960, proceedings to disqualify a WCJ “shall be initiated by the filing of a petition for disqualification supported by an affidavit or declaration under penalty of perjury stating in detail facts establishing one or more of the grounds for disqualification … .”

It has long been recognized that “[t]he allegations in a statement charging bias and prejudice of a judge must set forth specifically the facts on which the charge is predicated,” that “[a] statement containing nothing but conclusions and setting forth no facts constituting a ground for disqualification may be ignored,” and that “[w]here no facts are set forth in the statement there is no issue of fact to be determined.” (Mackie v. Dyer (1957) 154 Cal.App.2d 395, 399.

Furthermore, even if detailed and verified allegations of fact have been made, it is settled law that a WCJ is not subject to disqualification under section 641(f) if, prior to rendering a decision, the WCJ expresses an opinion regarding a legal or factual issue but the petitioner fails to show that this opinion is a fixed one that could not be changed upon the production of evidence and the presentation of arguments at or after further hearing. (Taylor v. Industrial Acc. Com. (Thomas) (1940) 38 Cal.App.2d 75, 79-80 [5 Cal.Comp.Cases 61].) – [Overruled on other grounds in Lumbermen’s Mut. Cas. Co. v. Industrial Acc. Com. (Cacozza) (1946) 29 Cal.2d 492, 499 [11 Cal.Comp.Cases 289] ].-

Additionally, even if the WCJ expresses an unqualified opinion on the merits, the WCJ is not subject to disqualification under section 641(f) if that opinion is “based upon the evidence then before [the WCJ] and upon the [WCJ’s] conception of the law as applied to such evidence.” (Id.; cf. Kreling v. Superior Court (1944) 25 Cal.2d 305, 312 [“It is [a judge’s] duty to consider and pass upon the evidence produced before him, and when the evidence is in conflict, to resolve that conflict in favor of the party whose evidence outweighs that of the opposing party.”].)

Also, it is “well settled … that the expressions of opinion uttered by a judge, in what he conceives to be a discharge of his official duties, are not evidence of bias or prejudice” under section 641(g) (Kreling, supra, 25 Cal.2d at pp. 310-311; accord: Mackie, supra, 154 Cal.App.2d at p. 400) and that “[e]rroneous rulings against a litigant, even when numerous and continuous, form no ground for a charge of bias or prejudice, especially when they are subject to review” (McEwen v. Occidental Life Ins. Co. (1916) 172 Cal. 6, 11; accord: Mackie, supra, 154 Cal.App.2d at p. 400.)

Similarly, “when the state of mind of the trial judge appears to be adverse to one of the parties but is based upon actual observance of the witnesses and the evidence given during the trial of an action, it does not amount to that prejudice against a litigant which disqualifies” the judge under section 641(g). (Kreling, supra, 25 Cal.2d at p. 312; see also Moulton Niguel Water Dist. v. Colombo (2003) 111 Cal.App.4th 1210, 1219 [“When making a ruling, a judge interprets the evidence, weighs credibility, and makes findings. In doing so, the judge necessarily makes and expresses determinations in favor of and against parties. How could it be otherwise? We will not hold that every statement a judge makes to explain his or her reasons for ruling against a party constitutes evidence of judicial bias.”].)

Under no circumstances may a party’s unilateral and subjective perception of bias afford a basis for disqualification. (Haas v. County of San Bernardino (2002) 27 Cal.4th 1017, 1034; Robbins v. Sharp Healthcare (2006) 71 Cal.Comp.Cases 1291, 1310-1311 (Significant Panel Decision).)

Christian L. Johnson sued his employer, California Department of Transportation based on claims arising out of his employment. He alleged fifteen claims against Caltrans, including for discrimination, harassment, and retaliation.

While the suit was pending, Paul Brown, an attorney for Caltrans, sent an email about the litigation to Nicolas Duncan, Johnson’s supervisor who was not named in the litigation.

The email contained a “CONFIDENTIALITY NOTICE” that stated: “This is a privileged attorney-client communication and/or is covered by the attorney work-product doctrine. It is for the sole use of the intended recipient(s). Any unauthorized review, use, disclosure, or distribution is prohibited. If you are not the intended recipient, please contact the sender by reply e-mail and destroy all copies of the original message. Do not print, copy or forward.”

Unbeknownst to Caltrans, Duncan took a photograph of the email and sent it to Johnson, who gave it to his attorney, John Shepardson. It is unclear why Duncan did this.

The next day, Shepardson emailed Caltrans’s counsel, Christopher Sims, attaching the image and saying it “was sent to my client.” Shepardson asserted that the email was intentionally disclosed and so “appears to be a waiver of attorney-client privilege, if any privilege attaches to communications with Mr. Duncan.” Shepardson also stated that the email was “distressing” to Johnson and asked Caltrans to “cease and desist any and all communications with employees that are misleading about the merits of [Johnson’s] claims.”

After extensive meet-and-confer communications, Caltrans sought a protective order on the ground that the email was covered by the attorney-client privilege. The trial court entered the order. In the months that followed, the parties engaged in a protracted dispute concerning Johnson’s and Shepardson’s compliance with the protective order’s terms.

Eventually, Caltrans filed a motion to enforce the order and later a motion to disqualify plaintiffs attorney John Shepardson and three retained experts. The trial court disqualified Shepardson and the experts. In The trial court cited State Comp. Ins. Fund v. WPS, Inc. (1999) 70 Cal.App.4th 644, 656-657 (State Fund) and McDermott Will & Emery LLP v. Superior Court (2017) 10 Cal.App.5th 1083, 1108-1109 (McDermott), two cases involving a lawyer’s ethical duties upon receiving documents that are or may be privileged. The court said that Caltrans could have reasonably expected Shepardson to comply with his duties under State Fund. The trial court additionally determined that Shepardson’s conduct would prejudice the ongoing proceedings.

On appeal, Johnson challenged the trial court’s disqualification order. Among other arguments, he claims that the Brown email was not protected by the attorney-client privilege, Caltrans waived any privilege through undue delay, and the court abused its discretion in ordering the drastic remedy of disqualification.

The Court of Appeal found no merit in his arguments and affirmed the disqualification order in the published case of Johnson v. Dept. of Transportation – C099319 (March 2025).

“A trial court’s authority to disqualify an attorney derives from the power inherent in every court ‘[t]o control in furtherance of justice, the conduct of its ministerial officers, and of all other persons in any manner connected with a judicial proceeding before it, in every matter pertaining thereto.’ ” (People ex rel. Dept. of Corporations v. SpeeDee Oil Change Systems, Inc. (1999) 20 Cal.4th 1135, 1145.) “[U]ltimately the issue involves a conflict between a client’s right to counsel of his choice and the need to maintain ethical standards of professional responsibility.”

“Protecting the confidentiality of communications between attorney and client is fundamental to our legal system. The attorney-client privilege is a hallmark of our jurisprudence that furthers the public policy of ensuring ‘ “the right of every person to freely and fully confer and confide in one having knowledge of the law, and skilled in its practice, in order that the former may have adequate advice and a proper defense.” ’ ” (People ex rel. Dept. of Corporations v. SpeeDee Oil Change Systems, Inc., supra, 20 Cal.4th at p. 1146.)

“We conclude the trial court properly disqualified Shepardson and the three experts after finding that State Fund’s obligations were not satisfied. First, the trial court correctly determined that Shepardson breached his State Fund obligations after he received the Brown email. When he received the email, Shepardson properly notified Caltrans. (State Fund, supra, 70 Cal.App.4th at p. 657.) But the record supports the trial court’s conclusion that his actions thereafter fell short of what State Fund requires. After receiving the email, and especially after Caltrans unequivocally asserted the privilege hours after learning of the disclosure, Shepardson was not permitted to examine the email any further, much less distribute the email to other witnesses or use it to formulate case strategy, pending an agreement between the parties or judicial intervention.”

Footnote 2 on page 25 notes that the State Fund requirements were codified in rule 4.4 of the California State Bar Rules of Professional Conduct.

The California Attorney General announced a $1.3 million settlement with Sedera, Inc. (Sedera) and Sedera Medical Cost Sharing Community, LLC (SMC) to resolve allegations that they violated California law by advertising and selling sham health insurance plans to over two thousand Californians.

In addition, the settlement resolves allegations that Sedera and SMC falsely advertised their sham plans as both novel “non-insurance” medical cost sharing products and as health care sharing ministry (HCSM) plans.

Sedera, Inc. and Sedera Medical Cost Sharing Community, LLC are organizations that offer a medical cost-sharing model as an alternative to traditional health insurance. They operate by pooling contributions from members to share the costs of large and unexpected medical expenses. Members voluntarily contribute monthly amounts, and the community collectively helps cover eligible medical needs.

Sedera, Inc.is a fon-profit corporation incorporated in Delaware in July of 2014 and with its principle place of business in Texas. It conducted and/or contracted business through its agents, employees and representatives in counties throughout the State of California, including Los Angeles County.

Sedera Medical Cost Sharing Community is a corporation organized under the laws of Texas. It was incorporated in Texas in November of 2019. It purports to be a non-profit with IRS 501(c)(3) status. However according to the complaint filed by the Attorney General “there is no record of the IRS ever providing 501(c)(3) status to SMC”. It conducted and/or contracted business through its agents, employees and representatives in counties throughout the State of California,

An investigation by the California Department of Justice found that because, among other things, Sedera and SMC collected mandatory monthly payments in exchange for the payment of medical services, Sedera and SMC operated health plans. Health plans are required to comply with a myriad of important state consumer protection laws and regulations. Those laws and regulations require that, among other things, health plans provide coverage for all essential health benefits, including preventative care. The products offered by Sedera and SMC did not.

“Sedera and SMC were able to sell their sham health insurance plans at lower costs precisely because those plans were a sham and failed to comply with state law. For example, they did not offer Californians the essential health benefits they were entitled to,” said the Attorney General. “Today’s settlement includes not only strong injunctive terms that prohibit Sedera and SMC from marketing, selling, or operating any plans in California, but also consumer restitution and payment for civil penalties. We welcome businesses in our state, but we will not allow them to prey on our people. Lastly, to my fellow Californians: please do your research and first consider applying for affordable, reliable coverage through Covered California.”

SMC, a corporation that falsely purported to be a non-profit, created, operated, and sold unauthorized health plans through its for-profit administrative vendor, Sedera. As part of the settlement, Sedera and SMC:

– – Will be prohibited from selling, marketing, and operating any health plans in California.
– – Will be prohibited from moving its California members to another plan or directing them to any other cost sharing entities.
– – Must delete their California customer lists and provide members with notice of their plan termination.
– – Must pay $1.3 million. Of that total, $800,000 will be for consumer restitution (two payments over six months) and $560,000 will be for civil penalties.

In April 2021, after receiving multiple complaints from consumers alleging that their HCSM plans refused to cover treatments and pay their medical bills, the California Attorney General issued a consumer alert, warning Californians about illegitimate HCSMs.

In January 2022, he filed a lawsuit against The Aliera Companies for purporting to be a HCSM. Further, in March 2023, the Attorney General announced a $2.1 million settlement against Alliance for Shared Health to resolve allegations that they offered and deceptively advertised sham health insurance.

Dublin Unified School District (DUSD) held a distribution event on March 24, 2021 at one of its middle schools for the “Farmers to Families Food Box Program,” which provided fresh food to families negatively affected by the COVID-19 pandemic. Catherine Kuo volunteered at this event.

While she was loading a food box into the rear of one vehicle, another vehicle entered the parking lot and pulled up behind. A DUSD employee approached the second car and instructed the driver to open the rear hatch of the vehicle so he could load a food box into the rear cargo area of that vehicle. The driver suddenly drove forward, crushing Kuo between the two vehicles. Kuo was transported to a medical center and died later that day.

Kuo’s family members and estate filed a complaint against DUSD asserting negligence and premises liability causes of action. The complaint alleged that DUSD was negligent by failing to implement basic safety protocols at the event, failing to communicate safety protocols to volunteers and others, and failing to train and/or supervise employees who were organizing and coordinating the event. It also alleged that DUSD had created a dangerous condition of public property by failing to implement such safety protocols.

DUSD moved for summary judgment, arguing that Labor Code section 3364.5 barred plaintiffs’ claims. Section 3364.5 is part of the Workers’ Compensation Act (§ 3201 et seq.). It provides that “a volunteer, unsalaried person authorized by the governing board of a school district or the county superintendent of schools to perform volunteer services for the school district or the county superintendent shall, upon the adoption of a resolution of the governing board of the school district or the county board of education so declaring, be deemed an employee of the district or the county superintendent for the purposes of this division and shall be entitled to the workmen’s compensation benefits provided by this division for any injury sustained by him while engaged in the performance of any service under the direction and control of the governing board of the school district or the county superintendent.” (§ 3364.5.)

In support of its motion, DUSD submitted Resolution 2011/12-30 (Resolution) passed and adopted by its board of trustees in 2012. DUSD also submitted the memorandum of coverage from the Protected Insurance Program for Schools applicable to the time period of the March 24, 2021 incident.

The trial court granted DUSD’s motion for summary judgment. It determined that death “falls into the category of an injury according to its plain meaning.” And while finding no ambiguity in the term, the court noted that the legislative history of the statute – evidencing an intent to provide school volunteers with the same protection as employees – supported this reading. The court concluded that section 3364.5 defeated its jurisdiction. Judgment was entered in favor of DUSD and against plaintiffs.

The Court of Appeal affirmed the summary judgment in the published case of Kuo v. Dublin Unified School Dist – A169912 (March 2025).

This appeal presented two questions of statutory interpretation: whether the term “any injury” covers fatal injuries like the one Kuo sustained here, and whether DUSD volunteers were “deemed” employees under section 3364.5.

The Court of Appeal wrote “Section 3364.5 provides entitlement to workers’ compensation for “any injury” sustained by a school volunteer while engaged in the performance of service. We conclude that fatal injuries unambiguously fall into the category of “any injury” according to its plain meaning.”

Plaintiffs argue that DUSD volunteers were not “deemed” employees under section 3364.5 for two reasons: (1) DUSD’s Resolution did not use the term “deemed,” and (2) DUSD did not treat its volunteers as employees. The Court of Appeal wrote “Neither is persuasive.”

“Nothing in the statute supports plaintiffs’ position that a resolution must explicitly use the word “deemed” to trigger section 3364.5. Section 3364.5 requires only that the governing board adopt a resolution “so declaring.” DUSD did exactly that, adopting a resolution stating, “in accordance with Section 3364.5 of the Labor Code, volunteers shall be entitled to Workers’ Compensation benefits for any injury sustained by him/her while in the performance of any service under the direction and control of the District Superintendent.” We do not read into the statute any additional requirement to use magic words, as such an interpretation would defy section 3202’s command that the WCA be liberally construed.”

The California Insurance Fraud Prevention Act (IFPA) is designed to protect both consumers and the integrity of the insurance industry within the state. Its primary goal is to combat and prevent fraudulent activities that exploit insurance systems, ensuring that trust and fairness remain central to these services.

What helps make the IFPA effective are its whistleblower provisions. Individuals who uncover fraudulent activities have the opportunity to file litigation against violators and receive a share of recovered funds as a reward for their courage.

An recent IFPA case filed in California involved serious allegations of unethical billing practices by Safelite Group Inc., Safelite Fulfillment inc., dba Safelite AutoGlass, a leading company in auto glass repair and replacement. A former employee, Brian Williams, stepped forward as a whistleblower, filing insurance fraud lawsuits in California and Illinois. He was last employed by Safelite as aproduct development and strategy manager

The Illinois Insurance Claims Fraud Prevention Act (IICFPA) was also central to the Safelite case. This Illinois law also allows whistleblowers to file lawsuits on behalf of the state against entities suspected of submitting false claims to insurers.

According to the allegations contained in Williams’ Second Amended Complaint filed in the San Mateo Superior Court last July, to recover damages and civil penalties on behalf of the People of the State of California, arising from an alleged insurance fraud scheme planned and carried out by Safelite.

According to Williams, Safelite consistently billed insurance companies for high-quality OEM (Original Equipment Manufacturer) parts – components trusted for their durability and performance. However instead of using these premium parts, Williams alleged Safelite often replaced them with cheaper, generic alternatives known as “universal molding.” Moldings are a rubber or plastic trim, most commonly black in color, that usually run along either the top or the top and sides of, and at times even around, the glass of a vehicle. Molding provides insulation and noise reduction while holding the window in place securely and safely.

The complaint contained examples of invoices sent to Safeco, Farmers and State Farm Insurance, charging for a higher grade molding than the universal moulding. And went on to allege that from “at least 2015 through 2020, Safelite engaged in this practice of using universal molding but charged insurance companies and others for part-specific molding on over 1 million vehicles. In 2019 and 2020 alone, Safelite charged insurance companies and others for part-specific molding, but used universal molding to outfit the vehicles, for over 255,000 vehicles, over 13,850 of which were for vehicles whose glass was replaced in California.”

“Safelite AutoGlass was systematically billing for OEM or aftermarket parts when universal moldings were actually used in their place. Furthermore, the data showed that this sort of billing was happening across all insurance clients and customers billed via account, including government agencies, commercial accounts, and fleet accounts.”

Another alleged scheme involved additional charges imposed by Safelite during the COVID-19 pandemic. Customers were reportedly billed for cleaning services intended to ensure safety and hygiene. However, the lawsuits alleged that these services were inconsistently applied and offered to only a small fraction of customers, raising questions about the company’s billing practices.

According to news sources SafeLite has agreed to a $31 million settlement to resolve the claims. Safelite did not admit to any wrongdoing.