Category: Daily News

Proposed legislation would enact important changes to hold dangerous doctors more accountable in California, but, according to Consumer Watchdog the proposal excludes crucial reforms that will continue threaten patient safety.

Under current law, the Medical Board of California is comprised of 15 members: eight physicians and seven public members. All eight professional members and five of the public members are appointed by the Governor. One public member of the Board is appointed by the Senate Committee on Rules and one public member is appointed by the Speaker of the Assembly.

The bill, SB 815,creates a public member majority on the Medical Board by adding two additional public members, a top priority of patient advocates, however advocates say the proposed law fails to mandate patients have rights in the enforcement process or receive timely information about their doctors. The legislation under consideration is the Medical Board’s sunset review bill and must be passed this year.

The bill creates a Complainant Liaison Unit at the Medical Board to interact with members of the public, but does not give people who file a complaint about patient harm rights in the enforcement process. That means, for example, the Board does not have to interview the patient who was harmed, or the loved ones of a patient who died, before closing their complaint. The bill also does not address advocates’ call for greater disclosure of doctors’ records online and in person, so patients will remain in the dark if their doctor has harmed other patients.

The bill does however propose several important reforms that patient advocates have championed and support, said Consumer Watchdog, including: Changing the balance of power on the board by giving it more public than doctor members; reducing the standard of proof in doctor discipline cases to match that used by 41 other state boards and reduce the time and cost of investigations; and increasing the doctor licensing fees that fund the Board so it can address staffing shortages and reduce case timelines that have crippled accountability.

The Board is required under current case law, (Ettinger v. Board of Medical Quality Assurance (1982) 135 Cal.App.3d 853, 856), to obtain “clear and convincing proof to a reasonable certainty.” This is a higher burden of proof than in 41 other jurisdictions throughout the U.S. states and territories, which generally apply a “preponderance of evidence’ standard.”

The proposed new law specifies that the standard of proof required to obtain an order on a statement of issues or accusation for a violation that would result in license suspension or revocation shall be a clear and convincing evidence standard and a preponderance of the evidence standard for any other violation.

And to facilitate the investigation process, the proposed law requires, when requested by an authorized officer of the law or by an authorized MBC representative, the owner, corporate officer, or manager of an entity licensed by the Board of Pharmacy to provide records within 3 days of when the request was made. And the proposal also requires MBC licensees to participate in an interview no later than 30 calendar days after being notified when the licensee is under investigation.

Under current law, MBC’s Central Complaint Unit (CCU) receives and triages all complaints. If it appears that a violation may have occurred, the complaint is transferred either to the DCA’s Division of Investigation, Health Quality Investigation Unit (HQIU), which includes sworn peace officers, or to MBC’s own Complaint Investigation Office (CIO), which is comprised of non-sworn special investigators.

Investigators investigate the complaint and, if warranted, refer the case for disciplinary action. MBC’s Discipline Coordination Unit processes all disciplinary documents and monitors cases that have been referred for formal discipline to the Office of the Attorney General (OAG), which serves as MBC’s prosecuting attorney.

If a licensee or registrant is placed on probation, MBC’s probation unit monitors the individual while they are on probation to ensure they are complying with the terms and conditions of probation. The Probation Unit is comprised of inspectors who are located throughout the state, housed within various field offices. Having inspectors throughout the state helps eliminate excess travel and enables probationers to have face-to-face meetings with the inspectors for monitoring purposes.

“We applaud Senator Roth for proposing reforms in this bill that will increase doctor accountability, including adding two public members to the Board, but without additional changes dangerous doctors will escape investigation and patients will continue to be harmed,” said Carmen Balber, executive director of Consumer Watchdog.

After noting that a “twist of fate brings to us substantially the same Nissan employment arbitration contract in two otherwise unrelated cases,” the Second District Court of Appeal published a pair of decisions involving the legal standard for determining “unconscionable” arbitration clauses.

The opinion in Basith v. Lithia Motors, Inc. – B316098 (Apr.2023) began by noting that “These two cases raise the same vital question in contract law: what exactly is California’s test for unconscionability? More precisely, when there is a very high degree of procedural unconscionability, is there any meaningful content to the second element of substantive unconscionability? In an online world where contracts usually appear only in a take-it-or-leave-it format and where there thus is much procedural unconscionability, this question about substantive unconscionability looms large.”

In Basith, and the companion Fuentes v. Empire Nissan, Inc. – B314490 (Apr.2023) Both cases involved employees of unrelated Nissan dealerships in southern California, who agreed to similar Nissan form arbitration clauses when hired. Both sued the dealerships for labor code related violations, and the dealerships filed motions to compel arbitration of the disputes. In both cases the trial court denied the motion, ruled the arbitration contract was unconscionable. The trial court was reversed in both published opinions.

Mohammad Basith applied to work as general manager for a car dealership doing business as Nissan of Carson. The dealership’s owner, Lithia Motors, Inc., ran a network of dealerships. Basith signed an arbitration agreement electronically. After Nissan terminated Basith, he sued Nissan and Nissan moved to compel arbitration. The trial court denied the motion, ruling the arbitration agreement was unconscionable.

When Evangelina Yanez Fuentes applied to work for at another Nissan dealership, she signed paper documents that included an “Applicant Statement and Agreement.” Below that heading, the print in this one-page form was “strikingly minute and, in the record photocopy, blurry to boot.” The longest paragraph squeezed something like 900 words into about three vertical inches.

When the Nissan dealership fired Fuentes, she sued, and it moved to compel arbitration. The trial court ruled the arbitration contract was unconscionable. Font size was a dominating issue in one case – Fuentes – and entirely absent as an issue in Basith’s case. In Fuentes the longest paragraph squeezed something like 900 words into about three vertical inches. Basith did not state he had trouble reading these documents.

In OTO, L.L.C. v. Kho (2019) 8 Cal.5th 111, 125 (Kho) the Supreme Court of California ruled that the unconscionability defense has two mandatory elements: a party must establish both procedural and substantive unconscionability.

The opinion noted that nearly every form employment contract can be perceived as having some procedural unfairness. Employees may lack power to bargain at all. Sometimes employers insist, “sign it or no job.” However, when “the law attributes some procedural unfairness to every form employment contract, the real fight boils down to whether the substance of the final terms are fair. “We must enforce this contract if its substance is even-handed.”

Fuentes argues the tiny and unreadable print of Nissan’s form makes the substance of the contract unfair. Tiny font size and unreadability go to the process of contract formation, however, and not the substance of the outcome. Font size and readability thus are logically pertinent to procedural unconscionability and not to substantive unconscionability.

Font size is not the substance of a contract. Terms can be fair or unfair in substance, no matter the font size. When an employer puts a contract in an unreadably minute font, this practice definitely is problematic, but not for substantive reasons. Under California law, an agreement must be both procedurally and substantively unconscionable to be unenforceable. Allowing a single feature to count for both categories would nullify this requirement.

Another argument about substantive unfairness is that Fuentes was the only one to sign the arbitration agreement, and this shows a lack of mutuality. “This argument is misplaced. Nissan’s missing signature is irrelevant to whether the substance of the contact is fair. A missing signature cannot make a fair deal unfair.”

Basith maintains the contract’s wording is so convoluted that uncounseled lay people would not understand whether the agreement meant they were waiving rights.

“A complaint about prolix legalese is the same type of objection as a complaint about font size. If the substance of a contract is fair, how the contract is expressed cannot change that. Font size, format style, or verbal obscurantism does not affect the fairness of the final allocation of rights and duties. This contention does not address, and cannot establish, substantive unfairness. To rule otherwise would drain the element of substantive unconscionability of meaningfully independent content and effectively would turn the unconscionability doctrine into a one-element test of vast and unsettling sweep.”

The majority opinion concluded that since the unconscionability defense requires a party to establish both procedural and substantive unconscionability. (Kho, supra, 8 Cal.5th at p. 125.) and there was no substantive unconscionability established in either case, the trial court was reversed in both cases, and the cases remanded with an order to arbitrated both cases.

A dissenting opinion was filed by P.J. Stratton in both cases.

18 arrests were announced in nine federal districts across the United States in a nationwide coordinated law enforcement action to combat health care fraud. Two of the most significant criminal cases in this sweep were filed in the Central District of California.

One of the cases involved 63 year old Dr. Anthony Hao Dinh, who lives in Newport Coast – a community south of Los Angeles – who was allegedly the second highest biller to the Health Resources and Services Administration’s Covid-19 Uninsured Program in the country. Dinh currently holds license 7642 as an Osteopathic Physician and Surgeon issued by the California Osteopathic Medical Board.  There are currently no disciplinary charges pending against him.  His address of record is 13132 Magnolia Street in Garden Grove.

As a result of the scheme Dr. Dinh and his companies allegedly were paid more than $153 million, and he used fraud proceeds for high-risk options trading in securities markets, losing over $100 million from November 2020 through February 2022.

Dr. Dinh allegedly submitted fraudulent claims for treatment of patients who were insured, billed for services that were not rendered, and billed for services that were not medically necessary, according to a criminal complaint filed on April 10. Prosecutors say one witness was a commander in the National Guard who brought an entire 60-person unit for testing. The witness denied getting any treatment, even though Dr. Dinh‘s clinic billed the Uninsured Program for a biopsy and control of a nosebleed.

Dr. Dinh is also charged with two other individuals for allegedly submitting over 70 fraudulent loan applications under the Paycheck Protection Program (PPP) and Economic Injury Disaster Loan (EIDL) Program and fraudulently obtaining over $3 million in loan funds.

The other defendants named in this scheme are Dr. Dinh’s sister – Hang Trinh Dinh, 64, of Lake Forest, who is currently a fugitive being sought by federal authorities – and Matthew Hoang Ho, 65, of Melbourne, Florida, who also was arrested on April 12.

Dr. Dinh is charged in the complaint with health care fraud and two counts of wire fraud. Hang Dinh and Matthew Ho are each charged with one count of wire fraud.

After being arrested on April 12 and subsequently released on a $7 million bond, Dr. Dinh is scheduled to be arraigned in United States District Court on May 22. If he were to be convicted of the three charges, Dr. Dinh would face a statutory maximum sentence of 50 years in federal prison.

In another case filed the Central District of California a clinical lab owner was charged for allegedly submitting over $358 million in false and fraudulent claims to Medicare, HRSA, and a private insurance company for laboratory testing.

The indictment alleges that the defendant’s lab performed COVID-19 screening testing for nursing homes and other facilities with vulnerable elderly populations, as well as primary and secondary schools. But to increase its reimbursements, the defendant allegedly fraudulently added claims for respiratory pathogen panel tests even though ordering providers and facility administrators did not want or need them.

Lourdes Navarro, 64, of Glendale, was charged with conspiracy to commit health care fraud and wire fraud, health care fraud, conspiracy to commit money laundering, and making false statements, in connection with the operation of Matias Clinical Laboratory, Inc., also known as Health Care Providers Laboratory, a laboratory she operated with her husband Imran Shams at 14411 Palmrose St, Baldwin Park, California.

Prosecutors say the two carried out a scheme to submit false and fraudulent claims to Medicare, the HRSA’s COVID-19 Uninsured Program, and an insurance company for respiratory pathogen panel (RPP) testing that was not ordered, medically unnecessary, procured through illegal kickbacks and bribes, and ineligible for reimbursement.

The superseding indictment alleges approximately $241 million in billed claims.

Drickey Jackson is a driver for Amazon’s delivery program known as Amazon Flex. Amazon engages these individuals to make deliveries in their own cars. Amazon describes them as “delivery partners” who sign up through the Amazon Flex app on a smartphone and deliver food and grocery orders from Whole Foods Market stores, Amazon Fresh locations, and other local stores, as well as packages and orders of goods from Amazon Delivery Stations, using their personal vehicles.

When Jackson signed up for the Flex program in December 2016, he accepted the 2016 TOS. It contained an arbitration clause that applied to disputes related to that agreement: The 2016 TOS stated that Flex participants were “responsible for reviewing this Agreement regularly to stay informed of any modifications.”

Amazon emailed a new TOS to Amazon Flex drivers in 2019, which contained a broader arbitration provision that made the issue of arbitrability itself subject to arbitration. Jackson continued in the program after 2019.

In February 2021, Jackson filed a class action lawsuit against Amazon in the United States District Court for the Southern District of California, alleging that it wiretapped Flex drivers’ communications and invaded their privacy by monitoring their closed Facebook groups. Jackson sought to represent a class of all Flex drivers in the United States who were members of the closed Facebook groups and allegedly had communications intercepted by Amazon without their consent. He also sought to represent a subclass of members in California.

The complaint alleged that during times when they were not working, the members of these groups communicated about matters of mutual interest. These included “planned strikes or protests, pay, benefits, deliveries, driving and warehouse conditions, unionizing efforts, and whether workers had been approached by researchers examining Amazon’s workforce.“

Jackson contends that Amazon monitored and wiretapped the drivers’ conversations when they communicated during off hours in closed Facebook groups. He claimed damages. And injunctive relief for alleged privacy violations of state and federal laws: the California Invasion of Privacy Act (Cal. Penal Code §§ 631, 635); invasion of privacy under California’s Constitution; the Federal Wiretap Act for the interception and disclosure of wire, oral, or electronic communications (18 U.S.C. §§ 2510, et seq.) and for the manufacture, distribution, possession, and advertising of wire, oral, or electronic communication (18 U.S.C. § 2512); and the Stored Communications Act (18 U.S.C. §§ 2701, et seq.).

Amazon moved to compel arbitration pursuant to the arbitration clause of the 2019 TOS under California law. The district court denied Amazon’s motion to compel. The court ruled that under California law, the 2016 TOS applied because Amazon had not shown that it provided individualized notice to Jackson of a 2019 TOS, and such individualized notice was necessary to establish mutual assent to the 2019 arbitration provision.

The district court further concluded that the claims of Amazon’s unlawful conduct fell outside the scope of the arbitration clause in the 2016 TOS because the claims were not related to the parties’ performance under the agreement.

The 9th Circuit Court of Appeals affirmed (with Judge Graber dissenting) in the published case of Jackson v Amazon – 3:20-cv-02365-WQH-BGS (April 2023).

Under California law and generally applicable principles of contract law, the burden is on Amazon as the party seeking arbitration to show that it provided notice of a new TOS and that there was mutual assent to the contractual agreement to arbitrate. Mutual assent requires, at a minimum, that the party relying on the contractual provision establish that the other party had notice and gave some indication of assent to the contract.

Here there was “no evidence that the email allegedly sent to drivers adequately notified drivers of the update. The district court did not have the email, so it could not evaluate whether the email (assuming it was received at all) sufficed to provide individualized notice.”

Jackson’s claims do not depend on any terms of his contract as a driver for Amazon Flex. And the harm Jackson alleges “is not measured by or dependent on the terms of” his work for Flex; rather, it involves Amazon’s alleged breach of wiretapping statutes and invasion of privacy.

“In this case, the allegations underlying Jackson’s claims involve employer misconduct wholly unrelated to the parties’ agreement.”

Brent Reynolds, sustained an injury on October 16, 2012 to his shoulder and wrist that arose out of and in the course of his employment as a sales representative for Hostess Brands.

The parties agreed to use Dr. Robert Fenton as an Agreed Medical Evaluator in Orthopedic Surgery. Defense counsel scheduled Dr. Fenton’s cross-examination to take place on August 15, 2016.

In May, Dr. Fenton transmitted a proposed deposition fee agreement to Defense counsel’s office, seeking Defendant’s acknowledgment and agreement to pay a $781.25 non-refundable deposit for the schedule cross-examination. Defense counsel executed this agreement on May 6, 2016, but did not copy opposing counsel when transmitting this now fully executed agreement back to Dr. Fenton. The deposition was eventually re-scheduled to October 31, 2016. The Defendant would ultimately pay the requested deposit, which Dr. Fenton would receive on or around October 19, 2016.

Applicant counsel requested that the October 31, 2016 cross-examination be re-scheduled. Dr. Fenton refused to waive his non-refundable deposit policy, and intended to charge the parties with an additional $781.25 for any re-scheduled deposition.

Around this time, Applicant counsel learned of the Defendant’s payment of a $781.25 non-refundable deposit, which he then objected to as being in excess of fee schedule. Applicant counsel then wrote a letter directly to Dr. Fenton on October 27, 2016, objecting to the cross-examination in its entirety, contending that Dr. Fenton was paid in excess of the fee schedule.

He further filed a Request to Strike Dr. Fenton and Petition for Costs, Sanctions, and Attorney’s Fees for Bad Faith Tactics, which in no uncertain terms accused Defendant of paying fees in excess of the fee schedule to attempt to sway Dr. Fenton to provide a more favorable opinion; Dr. Fenton was copied on this Petition.

In response, Defendant filed its own Petition for Costs and Sanctions on October 31, 2016 and its own Petition to Strike Dr. Fenton on November 2, 2016.

The WCJ ultimately ordered that Dr. Fenton be stricken as the agreed medical evaluator, but deferred action on the competing Petitions for Fees and Costs. The parties eventually settled the case via Stipulations with Request for Award based on a newly selected QME  reporting.

After a trial on the unresolved issue of the competing Petitions for Sanctions, the WCJ concluded that Applicant counsel’s challenge of the AME Dr. Fenton’s cross-examination fees was not bad faith as he possessed the statutory right to challenge the same. However, the Applicant’s conduct in communicating his objections to Dr. Fenton were in violation of Labor Code section 4062.3.

The WCJ further found that the Defendant’s payment of the $781.25 deposit was not done in bad faith as the fee was not in excess of the medical-legal fee schedule. However, Defendant also violated Labor Code section 4062.3 for failing to serve opposing party with the cross-examination fee agreement.

As a result the WCJ ruled that “neither party acted with clean hands, and that both Defendant and Applicant’s respective Petitions for Costs and Fees are denied.” A Petition for Reconsideration filed by the Defendant was denied in the panel decision of Reynolds v Hostess Brands – ADJ9714303 (February 2023).

The Defendant challenged the finding that their May 6, 2016 communication with Dr. Fenton was ex parte. as being a nonsubstantial communication. They argued it was just administrative, and therefore did not violate Labor Code section 4062.3(f).

In support of this position Defendant argued that the communication about the QME fees is “currently part of the CA workers’ compensation culture,” and that a finding from the WCAB that these communications “must be copied on all parties would essentially require a re-ordering of our whole workers’ compensation system.”

However, in the WCJs view, a fee agreement for a scheduled cross-examination goes beyond what the Petitioner characterized as “simple messages or administrative tasks.”

Various statutory and regulatory protections are designed to prevent a provider from receiving excessive fees. They support the conclusion that communications with an agreed medical evaluator regarding the payment of or an agreement to pay fees/deposit for a cross-examination cannot be deemed a nonsubstantial matter, particularly in light of the parties’ statutory right to challenge such fees.

Dr. Fenton’s non-refundable deposit policy seemingly conflicts with Code of Civil Procedure section 2034.450(a). Despite this, Defendant paid the deposit, which Dr. Fenton received on October 19, 2016.

“It is unclear why Defendant did not challenge this restrictive deposit and cancellation policy given that the Code of Civil Procedure section 2034.450(a) allows parties to issue payment at the commencement of the cross-examination. And this further supports the importance of apprising the opposing party of any such fee agreement.”