The Wall Street Journal, in a new story published this week, claims that the U.S. attorney for the Central District of California is investigating allegations that the Pacific Hospital of Long Beach executive paid kickbacks to physicians so they would refer their patients for spine surgery at his facility. Over the past 15 years, Michael D. Drobot built a Southern California business empire centered on treating people with back problems, many of them workers' compensation patients. At the heart of the operation is Pacific Hospital of Long Beach, a 184-bed facility that Mr. Drobot bought in 1997 and turned into a spine-surgery center.
Federal Bureau of Investigation agents raided the hospital and another company owned by Mr. Drobot earlier this month as part of what the agency termed a fraud investigation. Representatives for the FBI and the U.S. attorney's office declined to give specifics about the probe.People familiar with it say it is focused on allegations that Mr. Drobot operated a kickback scheme, under which he allegedly paid doctors thousands of dollars for each spine surgery they referred to Pacific Hospital. Under California's anti-kickback statute, it is illegal to pay money to induce patient referrals. The practice is also illegal under federal law if the patients referred are insured by government health programs such as Medicare or Medicaid.
"Mr. Drobot and the hospital categorically deny any accusation of impropriety concerning the hospital's outstanding and world-class spinal treatment program," Laura Salas Reyes, a spokeswoman for Pacific Hospital, said, adding that both Mr. Drobot and the hospital "are cooperating fully with authorities looking into the matter."
In written responses to questions from The Wall Street Journal for a front-page article last year, Mr. Drobot denied paying kickbacks to doctors for patient referrals. The article identified Pacific Hospital as a prolific spine-surgery facility: From 2001 to 2010, according to state data, it performed 5,138 spinal fusions on workers' compensation patients and billed $533 million for them - three times as much as any other hospital in California.
Spine surgery is among the most profitable businesses for hospitals nationwide. In California's workers' compensation system, it can be even more lucrative because hospitals are allowed to bill separately for spinal implants, creating room for abuse through excessively marked-up implant charges, according to fraud investigators employed by insurers.
Along with Pacific Hospital, Mr. Drobot owns a spinal-implant distributorship. Federal agents are investigating allegations he paid surgeons who agreed to use his distributorship's implants $15,000 for each lumbar fusion and $7,500 for each cervical fusion they performed at Pacific Hospital, the people familiar with the probe said. Surgeons who didn't use his implants were allegedly paid smaller sums, these people said.
Drobot's distributorship resold implants made by Alphatec Holdings Inc. Documents reviewed by the Journal show that Pacific Hospital marked up the Alphatec implants supplied by Mr. Drobot's distributorship sharply when it billed them to patients' insurers - in excess of limits set by the California's workers' compensation division. Alphatec's general counsel, Ebun Garner, said the firm let its contract with Mr. Drobot expire earlier this year after he violated it by charging excessive prices. Mr. Drobot didn't reply to an inquiry put to him through the hospital about Mr. Garner's version of events.
The U.S. attorney is probing allegations Mr. Drobot funneled the kickbacks to surgeons via another firm he owns that provides collection services to doctors, the people familiar with the probe said. In his answers to questions from the Wall Street Journal last year, Mr. Drobot denied any improper arrangements between the firm and surgeons operating at Pacific Hospital ...
Federal Bureau of Investigation agents raided the hospital and another company owned by Mr. Drobot earlier this month as part of what the agency termed a fraud investigation. Representatives for the FBI and the U.S. attorney's office declined to give specifics about the probe.People familiar with it say it is focused on allegations that Mr. Drobot operated a kickback scheme, under which he allegedly paid doctors thousands of dollars for each spine surgery they referred to Pacific Hospital. Under California's anti-kickback statute, it is illegal to pay money to induce patient referrals. The practice is also illegal under federal law if the patients referred are insured by government health programs such as Medicare or Medicaid.
"Mr. Drobot and the hospital categorically deny any accusation of impropriety concerning the hospital's outstanding and world-class spinal treatment program," Laura Salas Reyes, a spokeswoman for Pacific Hospital, said, adding that both Mr. Drobot and the hospital "are cooperating fully with authorities looking into the matter."
In written responses to questions from The Wall Street Journal for a front-page article last year, Mr. Drobot denied paying kickbacks to doctors for patient referrals. The article identified Pacific Hospital as a prolific spine-surgery facility: From 2001 to 2010, according to state data, it performed 5,138 spinal fusions on workers' compensation patients and billed $533 million for them - three times as much as any other hospital in California.
Spine surgery is among the most profitable businesses for hospitals nationwide. In California's workers' compensation system, it can be even more lucrative because hospitals are allowed to bill separately for spinal implants, creating room for abuse through excessively marked-up implant charges, according to fraud investigators employed by insurers.
Along with Pacific Hospital, Mr. Drobot owns a spinal-implant distributorship. Federal agents are investigating allegations he paid surgeons who agreed to use his distributorship's implants $15,000 for each lumbar fusion and $7,500 for each cervical fusion they performed at Pacific Hospital, the people familiar with the probe said. Surgeons who didn't use his implants were allegedly paid smaller sums, these people said.
Drobot's distributorship resold implants made by Alphatec Holdings Inc. Documents reviewed by the Journal show that Pacific Hospital marked up the Alphatec implants supplied by Mr. Drobot's distributorship sharply when it billed them to patients' insurers - in excess of limits set by the California's workers' compensation division. Alphatec's general counsel, Ebun Garner, said the firm let its contract with Mr. Drobot expire earlier this year after he violated it by charging excessive prices. Mr. Drobot didn't reply to an inquiry put to him through the hospital about Mr. Garner's version of events.
The U.S. attorney is probing allegations Mr. Drobot funneled the kickbacks to surgeons via another firm he owns that provides collection services to doctors, the people familiar with the probe said. In his answers to questions from the Wall Street Journal last year, Mr. Drobot denied any improper arrangements between the firm and surgeons operating at Pacific Hospital ...
The Division of Workers ’ Compensation has revised proposed regulations providing for the assessment of administrative penalties for Workers’ Compensation Information System (WCIS) reporting violations and posted them to the online forum where members of the public may review and comment on the proposal.
In addition, DWC has posted on the forum for comment a revised version of the California EDI Implementation Guide for First and Subsequent Reports of Injury (Version 3.1), a necessary tool in the electronic reporting of claim data to WCIS.
The proposed administrative penalty regulations implement Senate Bill 826, which amended Lab or Code section 138.6 by authorizing DWC to assess administrative penalties, up to $5,000 per year for each claims administrator, for a failure to report claim information or the failure to report such information accurately to WCIS. The proposed regulations provide:
The proposed penalty regulations are sections 9705.1 through 9705.2 in Title 8 of the California Code of Regulations.
The forum can be found online on the DWC website by clicking on current forums
Comments will be accepted on the forum until 5 p.m. on April 29. The DWC invites interest persons to participate in this important process ...
In addition, DWC has posted on the forum for comment a revised version of the California EDI Implementation Guide for First and Subsequent Reports of Injury (Version 3.1), a necessary tool in the electronic reporting of claim data to WCIS.
The proposed administrative penalty regulations implement Senate Bill 826, which amended Lab or Code section 138.6 by authorizing DWC to assess administrative penalties, up to $5,000 per year for each claims administrator, for a failure to report claim information or the failure to report such information accurately to WCIS. The proposed regulations provide:
- Schedule of penalties capped at $5,000 against a claims administrator in any given year. The schedule provides for no more than $100 per violation for violations where a mandatory report is not submitted or not accepted, and no more than $50 per violation for violations involving specific errors or late filings.
- Threshold rates of violations that are excluded from the calculation of penalty assessments.
- A requirement for DWC to publish an annual report on the compliance of claims administrator s.
The proposed penalty regulations are sections 9705.1 through 9705.2 in Title 8 of the California Code of Regulations.
The forum can be found online on the DWC website by clicking on current forums
Comments will be accepted on the forum until 5 p.m. on April 29. The DWC invites interest persons to participate in this important process ...
The Division of Workers’ Compensation has invited interested members of the public to a meeting May 7 to discuss the most efficient means of communication with Maximus Federal Services, the current independent medical and bill review organization. The meeting will be from 10 a.m. to noon in the auditorium of the Elihu Harris Building, 1515 Clay Street in Oakland
Principals from Maximus Federal Services will present an overview of how the requests for independent medical reviews (IMRs) and independent bill reviews (IBRs) are processed.
Workers’ compensation carriers and third party administrators are encouraged to join in this discussion regarding secure methods of transmitting documents and the best ways to handle billing and other communications issues.
Maximus Inc., trademarked as MAXIMUS, is an American for-profit privatizing company that provides business process services to government health and human services agencies in the United States, Australia, Canada, Saudi Arabia, and the United Kingdom. MAXIMUS focuses on administering government-sponsored programs, such as Medicaid, the Children's Health Insurance Program, health care reform, welfare-to-work, Medicare, child support enforcement, and other government programs. The company is based in Reston, Virginia, has 8,657 employees, and reported annual revenue of $1.05 billion in fiscal year 2012.
Over its nearly 40 year history it has not been without criticism. In October 2010, The Los Angeles Times reported that 146 medical workers, including doctors, nurses and pharmacists were allowed to keep working despite failing drug tests. MAXIMUS was awarded a $2.5 Million a year contract to run California's confidential "diversion programs". MAXIMUS contracted the work out to a subcontractor who in turn subcontracted the work to another company. The drug testing company was using the wrong standard of drug test from December 2009 to August 2010, resulting in medical workers who tested positive for drugs to continue working.
In October 2000 six state lawmakers in Wisconsin called for the termination of MAXIMUS' W-2 contract, saying the firm has "broken faith with the state and poor people the agency serves in Milwaukee County."
In November 1997, The Hartford Courant reported that MAXIMUS "gets minimal results" when it was hired by the State of Connecticut to manage a child care program for recipients of welfare. According to the Record-Journal, MAXIMUS "hired too few people, installed an inadequate phone system and fell weeks or months behind in making payments to day care providers ...
Principals from Maximus Federal Services will present an overview of how the requests for independent medical reviews (IMRs) and independent bill reviews (IBRs) are processed.
Workers’ compensation carriers and third party administrators are encouraged to join in this discussion regarding secure methods of transmitting documents and the best ways to handle billing and other communications issues.
Maximus Inc., trademarked as MAXIMUS, is an American for-profit privatizing company that provides business process services to government health and human services agencies in the United States, Australia, Canada, Saudi Arabia, and the United Kingdom. MAXIMUS focuses on administering government-sponsored programs, such as Medicaid, the Children's Health Insurance Program, health care reform, welfare-to-work, Medicare, child support enforcement, and other government programs. The company is based in Reston, Virginia, has 8,657 employees, and reported annual revenue of $1.05 billion in fiscal year 2012.
Over its nearly 40 year history it has not been without criticism. In October 2010, The Los Angeles Times reported that 146 medical workers, including doctors, nurses and pharmacists were allowed to keep working despite failing drug tests. MAXIMUS was awarded a $2.5 Million a year contract to run California's confidential "diversion programs". MAXIMUS contracted the work out to a subcontractor who in turn subcontracted the work to another company. The drug testing company was using the wrong standard of drug test from December 2009 to August 2010, resulting in medical workers who tested positive for drugs to continue working.
In October 2000 six state lawmakers in Wisconsin called for the termination of MAXIMUS' W-2 contract, saying the firm has "broken faith with the state and poor people the agency serves in Milwaukee County."
In November 1997, The Hartford Courant reported that MAXIMUS "gets minimal results" when it was hired by the State of Connecticut to manage a child care program for recipients of welfare. According to the Record-Journal, MAXIMUS "hired too few people, installed an inadequate phone system and fell weeks or months behind in making payments to day care providers ...
The Workers’ Compensation Insurance Rating Bureau of California has completed its report on insurer loss and premium experience valued as of December 31, 2012. This report is based on data reported to the WCIRB by insurers who wrote almost 100% of the statewide market.
California written premium (gross of deductible credits) for calendar year 2012 is approximately $12.5 billion. This is approximately 16% above the written premium reported for 2011 and 42% above the written premium reported for 2009.
The projected industry average charged rate (rates charged by insurers that reflect all rating plan adjustments except deductible credits, retrospective rating plan adjustments, terrorism charges, and policyholder dividends) per $100 of payroll for policies written between July 1, 2012 and December 31, 2012 is $2.60. This is approximately 12% above the average rate charged for 2011 and 24% above the average rate charged for 2009. However, the average rate charged in the second six months of 2012 remains approximately 59% less than the average rate charged in the second six months of 2003.
The WCIRB projects an ultimate accident year combined loss and expense ratio of 136% for accident year 2011, which is comparable to the 2009 and 2010 projections. The WCIRB preliminarily projects an ultimate accident year combined loss and expense ratio of 127% for accident year 2012. The combined ratios for the last four years are the highest since 2001.
The WCIRB projects indemnity claim frequency for accident year 2012 to be 2.7% above the frequency for 2011 and 12.8% above the frequency for 2009 (Exhibit 7). While projected indemnity claim frequency shows increases over the last three accident years, the 2012 frequency remains approximately 30% below the indemnity claim frequency experienced prior to the 2002 through 2004 reforms ...
California written premium (gross of deductible credits) for calendar year 2012 is approximately $12.5 billion. This is approximately 16% above the written premium reported for 2011 and 42% above the written premium reported for 2009.
The projected industry average charged rate (rates charged by insurers that reflect all rating plan adjustments except deductible credits, retrospective rating plan adjustments, terrorism charges, and policyholder dividends) per $100 of payroll for policies written between July 1, 2012 and December 31, 2012 is $2.60. This is approximately 12% above the average rate charged for 2011 and 24% above the average rate charged for 2009. However, the average rate charged in the second six months of 2012 remains approximately 59% less than the average rate charged in the second six months of 2003.
The WCIRB projects an ultimate accident year combined loss and expense ratio of 136% for accident year 2011, which is comparable to the 2009 and 2010 projections. The WCIRB preliminarily projects an ultimate accident year combined loss and expense ratio of 127% for accident year 2012. The combined ratios for the last four years are the highest since 2001.
The WCIRB projects indemnity claim frequency for accident year 2012 to be 2.7% above the frequency for 2011 and 12.8% above the frequency for 2009 (Exhibit 7). While projected indemnity claim frequency shows increases over the last three accident years, the 2012 frequency remains approximately 30% below the indemnity claim frequency experienced prior to the 2002 through 2004 reforms ...
Catholic Healthcare West owns and operates medical facilities in California and other states, including Mercy Medical Center Redding, a hospital and related facilities located in Redding, California. Janet Anderson started working at Mercy as a registered nurse in 1979.
In 2005, Anderson experienced medical symptoms - itching all over her arms and torso - that were consistent with an allergic reaction. Anderson went to the employee health department to undergo a "RAST" test for sensitivity to latex.
Before the results of the RAST test were known, Anderson was called to a meeting with the director of perioperative services, Jeanette Smith, and the OR manager, Kirk Williams. Smith had been hired by Mercy five months earlier to make the OR department financially more efficient and attract more physicians to perform surgeries at Mercy. As part of that effort, Smith evaluated Anderson’s position and duties and found them to be nonessential. Smith informed Anderson the position of OR data coordinator was being eliminated as part of a reorganization of the OR.At no time during the meeting was Anderson’s allergic reaction or the possibility the reaction was caused by latex exposure discussed. Anderson applied for and obtained a position as a circulating nurse in the outpatient surgery center.
Later it was determined that Anderson’s symptoms were related to latex sensitivity.
Anderson experienced another allergic reaction at work on March 11, 2005, and went to the emergency room. Anderson discussed the latex allergy with her supervisor at the outpatient surgery center who then designated one of the rooms as a latex-free area for Anderson to perform many of her duties. She continued to be reactive at work. Anderson stopped working and filed a workers’ compensation claim relating to the allergic reactions in March.
Anderson’s medical records described subsequent allergic reactions to latex in non-hospital settings and to such products as automobile tires, furniture, food products and food packaging. She was found to be sensitive to foods handled by food workers wearing latex gloves, and to latex on chairs and seats in movie theaters and restaurants. Her physician wrote on March 19, 2007, that Anderson "remains unemployable outside of her own home, which she has purposefully made latex free." Later he released her to transitional (modified) work, full-time depending on location, with no exposure to latex products. Efforts were made by the employer to locate work but she could not be returned to outpatient surgery, or to any other clinical locations within or outside of the hospital proper due to possible latex exposure.
Anderson filed a civil action which alleged five causes of action under the California Fair Employment and Housing Act. After a court trial, judgment was entered in Mercy's favor and Anderson appealed. The Court of Appeal in the unpublished decision of Janet Anderson v Catholic Healthcare West affirmed the judgment in favor of the employer. Anderson failed to demonstrate on appeal the trial court’s decision with respect to disability discrimination and wrongful termination based on disability was unsupported by substantial evidence ...
In 2005, Anderson experienced medical symptoms - itching all over her arms and torso - that were consistent with an allergic reaction. Anderson went to the employee health department to undergo a "RAST" test for sensitivity to latex.
Before the results of the RAST test were known, Anderson was called to a meeting with the director of perioperative services, Jeanette Smith, and the OR manager, Kirk Williams. Smith had been hired by Mercy five months earlier to make the OR department financially more efficient and attract more physicians to perform surgeries at Mercy. As part of that effort, Smith evaluated Anderson’s position and duties and found them to be nonessential. Smith informed Anderson the position of OR data coordinator was being eliminated as part of a reorganization of the OR.At no time during the meeting was Anderson’s allergic reaction or the possibility the reaction was caused by latex exposure discussed. Anderson applied for and obtained a position as a circulating nurse in the outpatient surgery center.
Later it was determined that Anderson’s symptoms were related to latex sensitivity.
Anderson experienced another allergic reaction at work on March 11, 2005, and went to the emergency room. Anderson discussed the latex allergy with her supervisor at the outpatient surgery center who then designated one of the rooms as a latex-free area for Anderson to perform many of her duties. She continued to be reactive at work. Anderson stopped working and filed a workers’ compensation claim relating to the allergic reactions in March.
Anderson’s medical records described subsequent allergic reactions to latex in non-hospital settings and to such products as automobile tires, furniture, food products and food packaging. She was found to be sensitive to foods handled by food workers wearing latex gloves, and to latex on chairs and seats in movie theaters and restaurants. Her physician wrote on March 19, 2007, that Anderson "remains unemployable outside of her own home, which she has purposefully made latex free." Later he released her to transitional (modified) work, full-time depending on location, with no exposure to latex products. Efforts were made by the employer to locate work but she could not be returned to outpatient surgery, or to any other clinical locations within or outside of the hospital proper due to possible latex exposure.
Anderson filed a civil action which alleged five causes of action under the California Fair Employment and Housing Act. After a court trial, judgment was entered in Mercy's favor and Anderson appealed. The Court of Appeal in the unpublished decision of Janet Anderson v Catholic Healthcare West affirmed the judgment in favor of the employer. Anderson failed to demonstrate on appeal the trial court’s decision with respect to disability discrimination and wrongful termination based on disability was unsupported by substantial evidence ...
A battle between professional athletes and owners of football, baseball, basketball, hockey and soccer teams starts Monday. The Los Angeles Times reports that dozens of retired athletes plan a news conference on the steps of the state Capitol to denounce a bill that would make it harder for them to file workers' compensation claims in California.
The measure, AB 1309 by Assemblyman Henry Perea (D-Fresno), seeks to close what he sees as a legal loophole that allows out-of-state players to file claims for compensation for sports injuries developed from years of pounding in the arena. An Assembly Insurance Committee hearing is set for April 24.
Opposing the bill are the players and their unions. The legislation interferes with collective bargaining agreements, said NFL Players Assn. Executive Director DeMaurice Smith. Among those players expected Monday are J.J. Stokes of the National Football League's San Francisco 49ers, Jacksonville Jaguars and New England Patriots; Ickey Woods of the NFL's Cincinnati Bengals; and Marty McSorley, who played hockey for half a dozen teams, including the Los Angles Kings and San Jose Sharks.
Perea counters that out-of-state players are taking advantage of an overly generous California law. "The question as I see it for the Legislature," he said, "is whether it is fair to burden California's system with these claims from out-of-state employees." ...
The measure, AB 1309 by Assemblyman Henry Perea (D-Fresno), seeks to close what he sees as a legal loophole that allows out-of-state players to file claims for compensation for sports injuries developed from years of pounding in the arena. An Assembly Insurance Committee hearing is set for April 24.
Opposing the bill are the players and their unions. The legislation interferes with collective bargaining agreements, said NFL Players Assn. Executive Director DeMaurice Smith. Among those players expected Monday are J.J. Stokes of the National Football League's San Francisco 49ers, Jacksonville Jaguars and New England Patriots; Ickey Woods of the NFL's Cincinnati Bengals; and Marty McSorley, who played hockey for half a dozen teams, including the Los Angles Kings and San Jose Sharks.
Perea counters that out-of-state players are taking advantage of an overly generous California law. "The question as I see it for the Legislature," he said, "is whether it is fair to burden California's system with these claims from out-of-state employees." ...
According to a new story in the Wall Street Journal, federal agents are looking into fraud allegations at companies owned by Michael D. Drobot, a hospital executive who built a Southern California business empire centered on treating spine injuries suffered by workers' compensation patients. Last week, FBI and IRS agents conducted searches at the companies as part of a fraud investigation by the U.S. attorney for the Central District of California, said Laura Eimiller, a spokeswoman for the FBI's Los Angeles field office. She added that the grand jury affidavit supporting the searches was sealed, and declined to provide specifics about the investigation.
The agents served search warrants on Pacific Hospital of Long Beach, a 184-bed facility owned and run by Mr. Drobot, and on Industrial Pharmacy Management LLC, a Drobot company based in Newport Beach that dispenses medications to patients in doctors' offices.
"We look forward to working with the authorities to resolve the misunderstandings that led to" the searches, said Laura Salas Reyes, a spokeswoman at the hospital. A person at the drug-dispensing firm said no one was available to comment. Mr. Drobot and his attorney didn't respond to requests for comment.
Mr. Drobot, 68 years old, acquired Pacific Hospital of Long Beach in 1997 and shifted its focus to spine surgeries for workers' compensation patients. In a front-page article last year, the Wall Street Journal identified the hospital as one of the most prolific spine-surgery facilities in California. From 2001 to 2010, according to state data, it performed 5,138 spinal fusions on workers' compensation patients and billed $533 million for them - three times as much as any other hospital in the state.
For a time, Mr. Drobot was in business with Paul Randall, a hospital marketer who served time in federal prison in the 1990s for racketeering. Mr. Randall said he recruited spine surgeons to operate at Mr. Drobot's hospital, and the two said they operated a magnetic-resonance-imaging business together. Documents reviewed by the Journal last year showed that Mr. Randall was under investigation by the U.S. attorney's office for allegedly inflating the cost of spinal implants and paying kickbacks to chiropractors and spine surgeons. Mr. Randall hasn't been charged and has denied engaging in any illegal activities. On Monday, he and his attorney both declined to comment.
In January, the Wall Street Journal reported that Randall was a consultant paid millions of dollars by Tri-City Regional Medical Center, that It built up this business rapidly. Tri-City is a 107-bed facility just south of Los Angeles near Long Beach. The small hospital billed workers' compensation insurers $65 million in 2010 for spinal fusions, up from less than $3 million three years earlier. Randall's role for Tri-City was twofold: bringing surgery cases to the hospital by recruiting surgeons to operate there, and supplying metal implants for the surgeries through distributorships he owned. An official of Tri-City said the hospital ended its relationship with Mr. Randall in the middle of last year, a few months after it ousted the executive who had hired him.
Mr. Randall, 52 years old, an entrepreneur with a collection of sports memorabilia and a yen for gambling, began his career as a hospital marketer in the mid-1990s after serving a stint in federal prison for racketeering. He was convicted of the felony in 1993 for deals that involved buying wooden shipping pallets on credit and reselling them without paying the original vendors, and was sentenced to a 21-month term. After serving time in the Terminal Island federal correctional facility in Long Beach harbor, Mr. Randall went into business with Michael D. Drobot, the owner of Pacific Hospital of Long Beach.
A Naval officer in the Vietnam era, Mr. Drobot bought Pacific in 1997 and shifted its focus to spine care for workers' compensation patients. For a decade, Messrs. Randall and Drobot operated a business that arranged for magnetic resonance imaging, or MRI, services. Randall was reportedly paid $25,000 a month to run the MRI business plus a share of profits. Mr. Drobot created several businesses focused on workers' compensation patients: a van service to shuttle patients, a provider of Spanish interpretation and a distributorship of metal implants used in back surgery. His hospital became one of the most prolific spine-surgery facilities in California.
After a business dispute between the two men, Mr. Randall in 2008 moved to Tri-City, a hospital eight miles away that then focused on bariatric surgery. Tri-City, which is a nonprofit institution, paid Mr. Randall more than $3.2 million between 2008 and July 2011 as a business-development consultant. Mr. Randall recruited some of the same spine surgeons to Tri-City that he earlier introduced to Mr. Drobot at Pacific. By August 2011, Mr. Randall said, he was back to doing spine-surgery marketing work for Mr. Drobot at Pacific Hospital of Long Beach. . Mr. Randall said he signed a $100,000-a-month marketing agreement with Mr. Drobot - technically between Mr. Drobot's spinal-implant distributorship and a Randall marketing firm - under which Mr. Randall is to provide services such as "recruiting surgeons to the medical staff of hospitals that use" implants Mr. Drobot distributes. Mr. Drobot said through a spokesman that he didn't recall entering into any such contract and that he didn't believe the signature on the document was his ...
The agents served search warrants on Pacific Hospital of Long Beach, a 184-bed facility owned and run by Mr. Drobot, and on Industrial Pharmacy Management LLC, a Drobot company based in Newport Beach that dispenses medications to patients in doctors' offices.
"We look forward to working with the authorities to resolve the misunderstandings that led to" the searches, said Laura Salas Reyes, a spokeswoman at the hospital. A person at the drug-dispensing firm said no one was available to comment. Mr. Drobot and his attorney didn't respond to requests for comment.
Mr. Drobot, 68 years old, acquired Pacific Hospital of Long Beach in 1997 and shifted its focus to spine surgeries for workers' compensation patients. In a front-page article last year, the Wall Street Journal identified the hospital as one of the most prolific spine-surgery facilities in California. From 2001 to 2010, according to state data, it performed 5,138 spinal fusions on workers' compensation patients and billed $533 million for them - three times as much as any other hospital in the state.
For a time, Mr. Drobot was in business with Paul Randall, a hospital marketer who served time in federal prison in the 1990s for racketeering. Mr. Randall said he recruited spine surgeons to operate at Mr. Drobot's hospital, and the two said they operated a magnetic-resonance-imaging business together. Documents reviewed by the Journal last year showed that Mr. Randall was under investigation by the U.S. attorney's office for allegedly inflating the cost of spinal implants and paying kickbacks to chiropractors and spine surgeons. Mr. Randall hasn't been charged and has denied engaging in any illegal activities. On Monday, he and his attorney both declined to comment.
In January, the Wall Street Journal reported that Randall was a consultant paid millions of dollars by Tri-City Regional Medical Center, that It built up this business rapidly. Tri-City is a 107-bed facility just south of Los Angeles near Long Beach. The small hospital billed workers' compensation insurers $65 million in 2010 for spinal fusions, up from less than $3 million three years earlier. Randall's role for Tri-City was twofold: bringing surgery cases to the hospital by recruiting surgeons to operate there, and supplying metal implants for the surgeries through distributorships he owned. An official of Tri-City said the hospital ended its relationship with Mr. Randall in the middle of last year, a few months after it ousted the executive who had hired him.
Mr. Randall, 52 years old, an entrepreneur with a collection of sports memorabilia and a yen for gambling, began his career as a hospital marketer in the mid-1990s after serving a stint in federal prison for racketeering. He was convicted of the felony in 1993 for deals that involved buying wooden shipping pallets on credit and reselling them without paying the original vendors, and was sentenced to a 21-month term. After serving time in the Terminal Island federal correctional facility in Long Beach harbor, Mr. Randall went into business with Michael D. Drobot, the owner of Pacific Hospital of Long Beach.
A Naval officer in the Vietnam era, Mr. Drobot bought Pacific in 1997 and shifted its focus to spine care for workers' compensation patients. For a decade, Messrs. Randall and Drobot operated a business that arranged for magnetic resonance imaging, or MRI, services. Randall was reportedly paid $25,000 a month to run the MRI business plus a share of profits. Mr. Drobot created several businesses focused on workers' compensation patients: a van service to shuttle patients, a provider of Spanish interpretation and a distributorship of metal implants used in back surgery. His hospital became one of the most prolific spine-surgery facilities in California.
After a business dispute between the two men, Mr. Randall in 2008 moved to Tri-City, a hospital eight miles away that then focused on bariatric surgery. Tri-City, which is a nonprofit institution, paid Mr. Randall more than $3.2 million between 2008 and July 2011 as a business-development consultant. Mr. Randall recruited some of the same spine surgeons to Tri-City that he earlier introduced to Mr. Drobot at Pacific. By August 2011, Mr. Randall said, he was back to doing spine-surgery marketing work for Mr. Drobot at Pacific Hospital of Long Beach. . Mr. Randall said he signed a $100,000-a-month marketing agreement with Mr. Drobot - technically between Mr. Drobot's spinal-implant distributorship and a Randall marketing firm - under which Mr. Randall is to provide services such as "recruiting surgeons to the medical staff of hospitals that use" implants Mr. Drobot distributes. Mr. Drobot said through a spokesman that he didn't recall entering into any such contract and that he didn't believe the signature on the document was his ...
President Barack Obama's 2014 budget proposal sent to Congress on Wednesday calls for reforms to two federal workers compensation programs: the Federal Employees' Compensation Act and the Defense Base Act.
According to the story on the Business Insurance website, the White House is proposing to act on longstanding recommendations by the Government Accountability Office and other federal organizations by converting retirement-age FECA beneficiaries to a "retirement annuity-level benefit." FECA currently creates an incentive for federal employees injured on the job to continue receiving its benefits beyond their retirement age, according to the budget proposal.
"In addition, while state workers compensation systems have waiting periods for benefits to discourage less serious claims, FECA has a three-day waiting period for non-postal employees that is imposed too late in the claims process to be effective," the proposal states.
The proposed changes also would impose a new up-front waiting period for FECA benefits and give the U.S. Department of Labor "additional tools to reduce improper payments." The budget proposal does not provide specifics, but the FECA changes would save more than $500 million over 10 years, it says.
The president's proposal also would replace the current Defense Base Act program with a governmentwide benefit fund that would bill individual federal agencies for their workers comp insurance costs. The DBA provides benefits for contract overseas workers on U.S. military bases and for workers on overseas public works projects.Under the DBA's current structure, federal agencies pay for their insurance through a "patchwork" of individual contracts, and its costs now exceed benefits paid "by a significant margin," according to the budget proposal. The proposal points out that the DBA's caseload increased by nearly 2,600% from 2002 to 2011, with more than 11,600 claims filed in 2011 ...
According to the story on the Business Insurance website, the White House is proposing to act on longstanding recommendations by the Government Accountability Office and other federal organizations by converting retirement-age FECA beneficiaries to a "retirement annuity-level benefit." FECA currently creates an incentive for federal employees injured on the job to continue receiving its benefits beyond their retirement age, according to the budget proposal.
"In addition, while state workers compensation systems have waiting periods for benefits to discourage less serious claims, FECA has a three-day waiting period for non-postal employees that is imposed too late in the claims process to be effective," the proposal states.
The proposed changes also would impose a new up-front waiting period for FECA benefits and give the U.S. Department of Labor "additional tools to reduce improper payments." The budget proposal does not provide specifics, but the FECA changes would save more than $500 million over 10 years, it says.
The president's proposal also would replace the current Defense Base Act program with a governmentwide benefit fund that would bill individual federal agencies for their workers comp insurance costs. The DBA provides benefits for contract overseas workers on U.S. military bases and for workers on overseas public works projects.Under the DBA's current structure, federal agencies pay for their insurance through a "patchwork" of individual contracts, and its costs now exceed benefits paid "by a significant margin," according to the budget proposal. The proposal points out that the DBA's caseload increased by nearly 2,600% from 2002 to 2011, with more than 11,600 claims filed in 2011 ...
Each year the California Chamber of Commerce releases a list of "job killer" bills to identify legislation that it claims will decimate economic and job growth in California. The CalChamber will track the bills throughout the rest of the legislative session and work to educate legislators about the serious consequences these bills will have on the state. The List for 2013 now shows several proposed legislative changes that pertain to workers' compensation and other workplace issues.
SB 626 (Beall; D-San Jose) Massive Workers’ Compensation Cost Increase - Unravels many of the employer cost-saving provisions in last year’s workers’ compensation reform package and results in employers paying nearly $1 billion in benefit increases to injured workers without an expectation that the increases will be fully offset by system savings.
AB 1138 (Chau; D-Alhambra) Massive Exposure to Civil Penalties and Liability - Inappropriately increases civil cases and civil penalties on employers by permitting civil action against those employers who fail to conspicuously post a list of every employee covered under an employer’s workers’ compensation insurance policy and to retain this list for five years.
SB 761 (DeSaulnier; D-Concord) Paid Family Leave Protection - Creates a new burden on small businesses and additional opportunities for frivolous litigation by transforming the paid family leave program, which is used as a wage replacement for an employee who is taking a separate leave of absence, into an additional paid protected leave.
AB 5 (Ammiano; D-San Francisco) Increased Exposure to Frivolous Litigation - Imposes costly and unreasonable mandates on employers that could jeopardize the health and safety of others by creating a new protected classification of employees and customers who are or are perceived to be homeless, low income, suffering from a mental disability, or physical disability, and establishing a private right of action for such individuals that includes statutory damages, punitive damages, and attorney’s fees.
AB 10 (Alejo; D-Salinas) Automatic Minimum Wage Increase - Unfairly increases California employers’ cost of doing business by raising the minimum wage $1.25 over the next three years and thereafter indexing the minimum wage based on inflation, which fails to take into account the current economic status of the state or other fees and costs employers are required to pay.
SB 404 (Jackson; D-Santa Barbara) Expansion of Discrimination Litigation - Makes it virtually impossible for employers to manage their employees and exposes them to a higher risk of litigation by expanding the Fair Employment and Housing Act to include a protected classification for any person who is, perceived, or associated with a family caregiver.
AB 1164 (Lowenthal; D-Long Beach) Inappropriate Wage Liens - Creates a dangerous and unfair precedent in the wage and hour arena by allowing employees to file liens on an employer’s personal property or real property where the work was performed, based on an alleged but unproven wage claim, that will take priority over other existing liens.
The CalChamber will continue to add legislation to the "job killer" list throughout the year as bills are amended or new language is introduced ...
SB 626 (Beall; D-San Jose) Massive Workers’ Compensation Cost Increase - Unravels many of the employer cost-saving provisions in last year’s workers’ compensation reform package and results in employers paying nearly $1 billion in benefit increases to injured workers without an expectation that the increases will be fully offset by system savings.
AB 1138 (Chau; D-Alhambra) Massive Exposure to Civil Penalties and Liability - Inappropriately increases civil cases and civil penalties on employers by permitting civil action against those employers who fail to conspicuously post a list of every employee covered under an employer’s workers’ compensation insurance policy and to retain this list for five years.
SB 761 (DeSaulnier; D-Concord) Paid Family Leave Protection - Creates a new burden on small businesses and additional opportunities for frivolous litigation by transforming the paid family leave program, which is used as a wage replacement for an employee who is taking a separate leave of absence, into an additional paid protected leave.
AB 5 (Ammiano; D-San Francisco) Increased Exposure to Frivolous Litigation - Imposes costly and unreasonable mandates on employers that could jeopardize the health and safety of others by creating a new protected classification of employees and customers who are or are perceived to be homeless, low income, suffering from a mental disability, or physical disability, and establishing a private right of action for such individuals that includes statutory damages, punitive damages, and attorney’s fees.
AB 10 (Alejo; D-Salinas) Automatic Minimum Wage Increase - Unfairly increases California employers’ cost of doing business by raising the minimum wage $1.25 over the next three years and thereafter indexing the minimum wage based on inflation, which fails to take into account the current economic status of the state or other fees and costs employers are required to pay.
SB 404 (Jackson; D-Santa Barbara) Expansion of Discrimination Litigation - Makes it virtually impossible for employers to manage their employees and exposes them to a higher risk of litigation by expanding the Fair Employment and Housing Act to include a protected classification for any person who is, perceived, or associated with a family caregiver.
AB 1164 (Lowenthal; D-Long Beach) Inappropriate Wage Liens - Creates a dangerous and unfair precedent in the wage and hour arena by allowing employees to file liens on an employer’s personal property or real property where the work was performed, based on an alleged but unproven wage claim, that will take priority over other existing liens.
The CalChamber will continue to add legislation to the "job killer" list throughout the year as bills are amended or new language is introduced ...
Sacramento County District Attorney Jan Scully said on her Facebook page that Ryan Patrick Wenker, 35, was convicted of making a false statement to fraudulently obtain compensation.
After Wenker claimed that he was hurt, Facebook posts and video surfaced, along with his standings in a bike race that took place May 12, 2010 in Prairie City, according to documents that were part of an investigation done by the Department of Corrections. The bike race took place two days after he filed a claim alleging an injury to his back, according to the documents.The DA’s office says a video posted online shows that Wenker is shooting video of mountain biking, using a helmet camera while riding behind others.
Scully reported that "Ryan Wenker was convicted of misdemeanor making a false statement to fraudulently obtain compensation. He filed a workers’ comp claim while employed with the Dept. of Corrections as a corrections officer. He alleged he injured his back at work. Photos and bike race standings posted on Wenker’s Facebook page show that he participated in a mountain bike race while collecting disability - see video. Wenker is wearing a camera attached to his helmet."
A spokeswoman for the DA’s office said that Wenker was ordered to serve 45 days in the Sacramento County Jail, and ordered to pay $5,000 in restitution to the Department of Corrections ...
After Wenker claimed that he was hurt, Facebook posts and video surfaced, along with his standings in a bike race that took place May 12, 2010 in Prairie City, according to documents that were part of an investigation done by the Department of Corrections. The bike race took place two days after he filed a claim alleging an injury to his back, according to the documents.The DA’s office says a video posted online shows that Wenker is shooting video of mountain biking, using a helmet camera while riding behind others.
Scully reported that "Ryan Wenker was convicted of misdemeanor making a false statement to fraudulently obtain compensation. He filed a workers’ comp claim while employed with the Dept. of Corrections as a corrections officer. He alleged he injured his back at work. Photos and bike race standings posted on Wenker’s Facebook page show that he participated in a mountain bike race while collecting disability - see video. Wenker is wearing a camera attached to his helmet."
A spokeswoman for the DA’s office said that Wenker was ordered to serve 45 days in the Sacramento County Jail, and ordered to pay $5,000 in restitution to the Department of Corrections ...
Elvira Mendez worked for the Los Angeles Unified School District at Encino Elementary School until she was laid off in November 2010 as a result of budget reductions. She was an office technician assigned to special education services. In August 2010, Marcia Koff became the Encino Elementary School principal.
During a meeting in August or early September 2010, Koff told Mendez and other staff members that, to protect student privacy, parents should not be allowed to view staff computer screens. On September 15, 2010, Koff saw Mendez talking to a parent at her desk behind the counter dividing the walkway from the desk area. Koff told the parent to move to the counter. The parent attempted to explain the subject of her conversation with Mendez, but Koff insisted that she move away from Mendez’s desk. Koff then pulled Mendez out of her chair by her shoulders, grabbed her left arm, and dragged her to the counter. Mendez felt a sharp pain in her upper left arm. During the incident, Koff told Mendez: "I told you not to speak to parents so close to your workstation." Ten minutes later, after Mendez had returned to her desk, Koff put her hands on Mendez’s shoulders and whispered into her ear: "I don’t want you to speak to parents next to your desk. That is one of the many complaints from the district."
Based on this incident, Mendez filed a police report against Koff the next day. She contacted her union representative about it on September 20, and complained in writing to Local District Superintendent Linda del Cueto on September 28. In the first week of October 2010, Mendez refused to proceed with the workers compensation claim the LAUSD had filed on her behalf. Also in the first week of October, Koff was asked to respond to Mendez’s complaint against her during a meeting with LAUSD directors Lisa Gaboudian and Dea Tramble. Koff was interviewed by police about the incident at the end of October 2010. No criminal charges were filed against her.
By letter dated October 15, 2010, the Personnel Commission notified Mendez of her layoff effective November 30, 2010. An office technician displaced from another school took over Mendez’s position, and her duties in special education were assigned to another office technician who transferred from a different school. A total of 1161 office technicians were laid off as a result of the RIF process.
In March 2011, Mendez sued Koff for assault and battery and the LAUSD for wrongful termination under Labor Code section 1102.5, subdivision (b). The trial court entered summary judgment in favor of the employer and Koff, and Mendez appealed the dismissal of her case. The Court of Appeal affirmed the dismissal in the unpublished opinion in Elvira Mendez v Los Angeles Unified School District.
The Court of Appeal noted that workers’ compensation is the exclusive remedy for injuries caused by the tortious conduct of co-workers acting within the scope of their employment. (Lab. Code, § 3601, subd. (a); Torres v. Parkhouse Tire Service, Inc. (2001) 26 Cal.4th 995, 1002 (Torres).) An exception exists for injuries caused by a co-worker’s "willful and unprovoked physical act of aggression." (Lab. Code, § 3601, subd. (a)(1).) This exception requires that the co-worker acted with a specific intent to injure. (Torres, supra, 26 Cal.4th at p. 1005.)
Mendez argues that whether Koff acted with an intent to injure her when she dragged her to the counter presents a triable issue of fact. The Court of Appeal disagreed. In Torres, supra, 26 Cal.4th 995, the California Supreme Court explained: "Flare-ups, frustrations, and disagreements among employees are commonplace in the workplace and may lead to ‘physical act[s] of aggression.’ [Citations.] ‘"In bringing [people] together, work brings [personal] qualities together, causes frictions between them, creates occasions for lapses into carelessness, and for fun-making and emotional flareup. . . . These expressions of human nature are incidents inseparable from working together. They involve risks of injury and these risks are inherent in the working environment." [Citations.]’" (Id. at p. 1009.) Because "willful acts, including aggressive physical acts, may be considered within the scope of employment," the intent to injure requires something more. (Ibid., citing Johns-Manville Products Corp. v. Superior Court (1980) 27 Cal.3d 465, 476 [trend toward allowing actions against employer who "‘acts deliberately for the purpose of injuring the employee’"].)
Viewed in the light most favorable to Mendez, the facts do not support a reasonable inference that Koff acted with the specific intent to physically injure Mendez ...
During a meeting in August or early September 2010, Koff told Mendez and other staff members that, to protect student privacy, parents should not be allowed to view staff computer screens. On September 15, 2010, Koff saw Mendez talking to a parent at her desk behind the counter dividing the walkway from the desk area. Koff told the parent to move to the counter. The parent attempted to explain the subject of her conversation with Mendez, but Koff insisted that she move away from Mendez’s desk. Koff then pulled Mendez out of her chair by her shoulders, grabbed her left arm, and dragged her to the counter. Mendez felt a sharp pain in her upper left arm. During the incident, Koff told Mendez: "I told you not to speak to parents so close to your workstation." Ten minutes later, after Mendez had returned to her desk, Koff put her hands on Mendez’s shoulders and whispered into her ear: "I don’t want you to speak to parents next to your desk. That is one of the many complaints from the district."
Based on this incident, Mendez filed a police report against Koff the next day. She contacted her union representative about it on September 20, and complained in writing to Local District Superintendent Linda del Cueto on September 28. In the first week of October 2010, Mendez refused to proceed with the workers compensation claim the LAUSD had filed on her behalf. Also in the first week of October, Koff was asked to respond to Mendez’s complaint against her during a meeting with LAUSD directors Lisa Gaboudian and Dea Tramble. Koff was interviewed by police about the incident at the end of October 2010. No criminal charges were filed against her.
By letter dated October 15, 2010, the Personnel Commission notified Mendez of her layoff effective November 30, 2010. An office technician displaced from another school took over Mendez’s position, and her duties in special education were assigned to another office technician who transferred from a different school. A total of 1161 office technicians were laid off as a result of the RIF process.
In March 2011, Mendez sued Koff for assault and battery and the LAUSD for wrongful termination under Labor Code section 1102.5, subdivision (b). The trial court entered summary judgment in favor of the employer and Koff, and Mendez appealed the dismissal of her case. The Court of Appeal affirmed the dismissal in the unpublished opinion in Elvira Mendez v Los Angeles Unified School District.
The Court of Appeal noted that workers’ compensation is the exclusive remedy for injuries caused by the tortious conduct of co-workers acting within the scope of their employment. (Lab. Code, § 3601, subd. (a); Torres v. Parkhouse Tire Service, Inc. (2001) 26 Cal.4th 995, 1002 (Torres).) An exception exists for injuries caused by a co-worker’s "willful and unprovoked physical act of aggression." (Lab. Code, § 3601, subd. (a)(1).) This exception requires that the co-worker acted with a specific intent to injure. (Torres, supra, 26 Cal.4th at p. 1005.)
Mendez argues that whether Koff acted with an intent to injure her when she dragged her to the counter presents a triable issue of fact. The Court of Appeal disagreed. In Torres, supra, 26 Cal.4th 995, the California Supreme Court explained: "Flare-ups, frustrations, and disagreements among employees are commonplace in the workplace and may lead to ‘physical act[s] of aggression.’ [Citations.] ‘"In bringing [people] together, work brings [personal] qualities together, causes frictions between them, creates occasions for lapses into carelessness, and for fun-making and emotional flareup. . . . These expressions of human nature are incidents inseparable from working together. They involve risks of injury and these risks are inherent in the working environment." [Citations.]’" (Id. at p. 1009.) Because "willful acts, including aggressive physical acts, may be considered within the scope of employment," the intent to injure requires something more. (Ibid., citing Johns-Manville Products Corp. v. Superior Court (1980) 27 Cal.3d 465, 476 [trend toward allowing actions against employer who "‘acts deliberately for the purpose of injuring the employee’"].)
Viewed in the light most favorable to Mendez, the facts do not support a reasonable inference that Koff acted with the specific intent to physically injure Mendez ...
A San Diego grand jury indictment has been returned charging two defendants with a total of 21 felony counts in an ongoing payroll scheme at a College Area restaurant that violated minimum wage laws and California theft laws. Over a two-year period, the defendants hired more than 20 servers and cooks, many of them college students, to work at State Street Grill but refused to pay them after a week of work or offered them a wage that amounted to less than $5 per hour.
This is believed to be the first case in California where wages stolen from employees that were then not reported to the insurance company as payroll is being used as the basis to charge premium fraud.
David Dadon, 61, and his son Barry Dadon, 27, have both been charged with workers’ compensation premium fraud, payroll tax evasion, sales tax evasion and grand theft of labor from 23 victims. David Dadon was also indicted on one count of the fraudulent removal of property under a lease and two counts of attempted extortion. If convicted of all the charges, David Dadon faces up to 21 years in prison and Barry Dadon faces up to 18 years and possible restitution to the victims.
The case was originally referred to the DA’s Insurance Fraud Division from the California Labor Commissioner, whose Criminal Investigation Unit launched an investigation of State Street Grill, located at 5131 College Avenue in San Diego. The investigation revealed wages earned but not received by at least 23 individuals. As many as 50 potential additional victims are being encouraged to come forward. The DA’s Office worked closely with the Labor Commission to investigate the case. The Labor Commissioner's office, also known as the Division of Labor Standards Enforcement (DLSE), is the state agency charged with labor law enforcement in California.
The men advertised on Craigslist for immediate placement of server and cook positions. They would offer the applicant the position if they accepted to work without pay for the first seven days. This was considered to be the "training period." If, after the first seven days of unpaid work, the Dadons were satisfied by the employees’ performance, they indicated the workers would be "put on the schedule" and paid wages. In desperate need of income, many accepted the offer. The trainees described working in excess of 40 hours per week (many 50 to 60) and were never paid. In addition, the Dadons took some of the tips the workers earned.
Employees who were hired after the training period continued to work 50 to 60 hours per week and were fired if they refused to accept a $400 semi-monthly salary. Based on the number of hours worked many employees were working for less than five dollars per hour ...
This is believed to be the first case in California where wages stolen from employees that were then not reported to the insurance company as payroll is being used as the basis to charge premium fraud.
David Dadon, 61, and his son Barry Dadon, 27, have both been charged with workers’ compensation premium fraud, payroll tax evasion, sales tax evasion and grand theft of labor from 23 victims. David Dadon was also indicted on one count of the fraudulent removal of property under a lease and two counts of attempted extortion. If convicted of all the charges, David Dadon faces up to 21 years in prison and Barry Dadon faces up to 18 years and possible restitution to the victims.
The case was originally referred to the DA’s Insurance Fraud Division from the California Labor Commissioner, whose Criminal Investigation Unit launched an investigation of State Street Grill, located at 5131 College Avenue in San Diego. The investigation revealed wages earned but not received by at least 23 individuals. As many as 50 potential additional victims are being encouraged to come forward. The DA’s Office worked closely with the Labor Commission to investigate the case. The Labor Commissioner's office, also known as the Division of Labor Standards Enforcement (DLSE), is the state agency charged with labor law enforcement in California.
The men advertised on Craigslist for immediate placement of server and cook positions. They would offer the applicant the position if they accepted to work without pay for the first seven days. This was considered to be the "training period." If, after the first seven days of unpaid work, the Dadons were satisfied by the employees’ performance, they indicated the workers would be "put on the schedule" and paid wages. In desperate need of income, many accepted the offer. The trainees described working in excess of 40 hours per week (many 50 to 60) and were never paid. In addition, the Dadons took some of the tips the workers earned.
Employees who were hired after the training period continued to work 50 to 60 hours per week and were fired if they refused to accept a $400 semi-monthly salary. Based on the number of hours worked many employees were working for less than five dollars per hour ...
Applicant Eliezer Figueroa , a machine operator, injured his back, neck and psyche. His claim was resolved in 2011 by a Findings, Award and Order. On July 30, 2012, a lien claimant, (not Orthomed), filed a Declaration of Readiness to Proceed requesting a lien conference.
The lien conference was set for January 9, 2013, at 8:30 a.m. Orthomed did not appear at the conference. Because Orthomed did not submit proof of prior timely payment of the lien activation fee, and because the WCJ reviewed the record and determined that the lien activation fee had not in fact been paid, the WCJ dismissed Orthomed’s lien with prejudice, without first issuing a notice of intention.
On reconsideration, Orthomed argued that the activation fee is not payable where the defendant has not served supporting documents, thus depriving them of the opportunity to resolve the lien. Orthomed also contends that "the new lien regulations lacks [sic] latitude in allowing certain circumstances that are not just black and white." The WCAB in the significant panel decision of Eliezer Figueroa v B.C. Doering Co., Employers Compensation Insurance Co. sustained the dismissal of Orthomed's lien.
Section 4903.06, effective January 1, 2013, provides that with certain exceptions "[a]ny lien filed pursuant to subdivision (b) of Section 4903 prior to January 1, 2013, and any cost that was filed as a lien prior to January 1, 2013, shall be subject to a lien activation fee." (Lab. Code, § 4903.06(a).) The lien activation fee is $100. (Lab. Code, § 4903.06(a)(1).) A lien claimant that files a DOR must include proof of payment of the fee with the DOR. (Lab. Code, § 4903.06(a)(2).): In relevant part, section 4903.06 further provides: "All lien claimants that did not file the declaration of 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." (Lab. Code, 4903.06(a)(4).)
Administrative Director Rule 10208(a) (Cal. Code Regs., tit. 8, § 10208(a)), which is an emergency regulation that became operative January 1, 2013, provides in relevant part: "Any lien filed pursuant to Labor Code section 4903(b) filed prior to January 1, 2013, and any cost filed as a lien prior to January 1, 2013, shall be subject to a lien activation fee in the sum of one hundred dollars ($100.00), payable to the Division of Workers’ Compensation prior to filing a Declaration of Readiness to Proceed for a lien conference by that party, prior to appearing at a lien conference for a case, or on or before January 1, 2014, whichever occurs first."
The WCAB interpreted the payment "at the lien conference" language of section 4903.06(a)(4) and the payment "prior to appearing at a lien conference" language of emergency Rule 10208(a) to mean that a lien activation fee must be paid prior to the commencement of a lien conference, which is the time that the conference is scheduled to begin, not the time when the case is actually called. Any payment made after the noticed hearing time is not timely. Therefore, the lien of Orthomed was correctly dismissed with prejudice.
The Appeals Board panel held that, where a lien claim falls within the lien activation fee requirements of Labor Code section 4903.06: (1) the lien activation fee must be paid prior to the commencement of a lien conference, which is the time that the conference is scheduled to begin, not the time when the case is actually called; (2) if the lien claimant fails to pay the lien activation fee prior to the commencement of a lien conference and/or fails to provide proof of payment at the conference, its lien must be dismissed with prejudice; (3) a breach of a defendant’s duty to serve required documents or to engage in settlement negotiations does not excuse a lien claimant’s obligation to pay the lien activation fee; and (4) a notice of intention is not required prior to dismissing a lien with prejudice for failure to pay the lien activation fee or failure to present proof of payment of the lien activation fee at a lien conference ...
The lien conference was set for January 9, 2013, at 8:30 a.m. Orthomed did not appear at the conference. Because Orthomed did not submit proof of prior timely payment of the lien activation fee, and because the WCJ reviewed the record and determined that the lien activation fee had not in fact been paid, the WCJ dismissed Orthomed’s lien with prejudice, without first issuing a notice of intention.
On reconsideration, Orthomed argued that the activation fee is not payable where the defendant has not served supporting documents, thus depriving them of the opportunity to resolve the lien. Orthomed also contends that "the new lien regulations lacks [sic] latitude in allowing certain circumstances that are not just black and white." The WCAB in the significant panel decision of Eliezer Figueroa v B.C. Doering Co., Employers Compensation Insurance Co. sustained the dismissal of Orthomed's lien.
Section 4903.06, effective January 1, 2013, provides that with certain exceptions "[a]ny lien filed pursuant to subdivision (b) of Section 4903 prior to January 1, 2013, and any cost that was filed as a lien prior to January 1, 2013, shall be subject to a lien activation fee." (Lab. Code, § 4903.06(a).) The lien activation fee is $100. (Lab. Code, § 4903.06(a)(1).) A lien claimant that files a DOR must include proof of payment of the fee with the DOR. (Lab. Code, § 4903.06(a)(2).): In relevant part, section 4903.06 further provides: "All lien claimants that did not file the declaration of 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." (Lab. Code, 4903.06(a)(4).)
Administrative Director Rule 10208(a) (Cal. Code Regs., tit. 8, § 10208(a)), which is an emergency regulation that became operative January 1, 2013, provides in relevant part: "Any lien filed pursuant to Labor Code section 4903(b) filed prior to January 1, 2013, and any cost filed as a lien prior to January 1, 2013, shall be subject to a lien activation fee in the sum of one hundred dollars ($100.00), payable to the Division of Workers’ Compensation prior to filing a Declaration of Readiness to Proceed for a lien conference by that party, prior to appearing at a lien conference for a case, or on or before January 1, 2014, whichever occurs first."
The WCAB interpreted the payment "at the lien conference" language of section 4903.06(a)(4) and the payment "prior to appearing at a lien conference" language of emergency Rule 10208(a) to mean that a lien activation fee must be paid prior to the commencement of a lien conference, which is the time that the conference is scheduled to begin, not the time when the case is actually called. Any payment made after the noticed hearing time is not timely. Therefore, the lien of Orthomed was correctly dismissed with prejudice.
The Appeals Board panel held that, where a lien claim falls within the lien activation fee requirements of Labor Code section 4903.06: (1) the lien activation fee must be paid prior to the commencement of a lien conference, which is the time that the conference is scheduled to begin, not the time when the case is actually called; (2) if the lien claimant fails to pay the lien activation fee prior to the commencement of a lien conference and/or fails to provide proof of payment at the conference, its lien must be dismissed with prejudice; (3) a breach of a defendant’s duty to serve required documents or to engage in settlement negotiations does not excuse a lien claimant’s obligation to pay the lien activation fee; and (4) a notice of intention is not required prior to dismissing a lien with prejudice for failure to pay the lien activation fee or failure to present proof of payment of the lien activation fee at a lien conference ...
The owner of a private security company hired to patrol Oldtown Salinas and help clean up the homeless problem is now facing prison time for tax evasion and insurance fraud.
The report on KBSW.com says that Monterey County prosecutors charged Anthony Vincent with four felony and two misdemeanor counts of not providing workers comp insurance to employees, and failing to pay employee taxes. Vincent is the owner of ESA International, a Salinas-based private security company. They were hired by the Salinas Oldtown Association 18 months ago to patrol downtown.
The director of the association, Amit Pandya, was surprised by the allegations against Vincent. Pandya said Vincent’s company has been a good partner and helped crack down on crime. The company is paid $200 a month to patrol the area, but the director says the partnership will be reconsidered when the association has it’s next regular meeting Thursday. One possibility is to terminate the contract with ESA International. The current contract is set to expire at the end of June.
Vincent’s attorney says his client was advised by his accountant to hire his security guards as independent contractors to avoid paying worker’s comp. But that’s against the law.
Vincent will be arraigned April 30. A conviction on all counts could mean 12 years in prison ...
The report on KBSW.com says that Monterey County prosecutors charged Anthony Vincent with four felony and two misdemeanor counts of not providing workers comp insurance to employees, and failing to pay employee taxes. Vincent is the owner of ESA International, a Salinas-based private security company. They were hired by the Salinas Oldtown Association 18 months ago to patrol downtown.
The director of the association, Amit Pandya, was surprised by the allegations against Vincent. Pandya said Vincent’s company has been a good partner and helped crack down on crime. The company is paid $200 a month to patrol the area, but the director says the partnership will be reconsidered when the association has it’s next regular meeting Thursday. One possibility is to terminate the contract with ESA International. The current contract is set to expire at the end of June.
Vincent’s attorney says his client was advised by his accountant to hire his security guards as independent contractors to avoid paying worker’s comp. But that’s against the law.
Vincent will be arraigned April 30. A conviction on all counts could mean 12 years in prison ...
FBI and IRS agents arrived at Pacific Hospital of Long Beach last week to serve a warrant as part of an investigation involving possible fraud against the institution. According to the Press-Telegram, the warrant was served at 8AM on Friday and agents were reportedly looking through computer files
The Long Beach Post says that FBI spokesperson Laura Emiller confirmed that a search warrant was served for possible allegations of fraud at Pacific Hospital of Long Beach, but she was unable to provide further details, noting that the search was sealed by the court. Though the nature of the possible allegations are still unclear, agencies that are also involved in the investigation include the IRS, California Department of Labor, California Department of Insurance, USPS Inspector General's Office and the DCIS.
Given the number of agencies involved, it appears that the incident being investigated is larger in scope than the self-reported employee fraud discovered by the hospital in 2009, which was investigated by local law enforcement and the California Department of Public Health
In 2010, the hospital was fined $225,000 for a self-reported fraud incident in which an employee had obtained patients' personal information--including names and social security numbers--and used it to open fraudulent telephone service accounts. Even though the employee was terminated from the hospital in 2009 and the hospital worked closely with law enforcement on the case, Pacific Hospital was fined by the California Department of Public Health, which alleged that the facility "failed to prevent unauthorized access."
"Our hospital takes patient safety very seriously and has done nothing wrong," a statement from Pacific Hospital public relations director Laura Salas said at the time. "At Pacific Hospital of Long Beach, we work diligently to serve our community by continually monitoring and improving patient safety programs and are proud of our ability to keep patient information safe from access by unauthorized persons."
It is not known if that case is related to the current search warrant. Pacific Hospital has yet to return calls for comment ...
The Long Beach Post says that FBI spokesperson Laura Emiller confirmed that a search warrant was served for possible allegations of fraud at Pacific Hospital of Long Beach, but she was unable to provide further details, noting that the search was sealed by the court. Though the nature of the possible allegations are still unclear, agencies that are also involved in the investigation include the IRS, California Department of Labor, California Department of Insurance, USPS Inspector General's Office and the DCIS.
Given the number of agencies involved, it appears that the incident being investigated is larger in scope than the self-reported employee fraud discovered by the hospital in 2009, which was investigated by local law enforcement and the California Department of Public Health
In 2010, the hospital was fined $225,000 for a self-reported fraud incident in which an employee had obtained patients' personal information--including names and social security numbers--and used it to open fraudulent telephone service accounts. Even though the employee was terminated from the hospital in 2009 and the hospital worked closely with law enforcement on the case, Pacific Hospital was fined by the California Department of Public Health, which alleged that the facility "failed to prevent unauthorized access."
"Our hospital takes patient safety very seriously and has done nothing wrong," a statement from Pacific Hospital public relations director Laura Salas said at the time. "At Pacific Hospital of Long Beach, we work diligently to serve our community by continually monitoring and improving patient safety programs and are proud of our ability to keep patient information safe from access by unauthorized persons."
It is not known if that case is related to the current search warrant. Pacific Hospital has yet to return calls for comment ...
The California Department of Insurance (CDI) arrested Robinson Yang, 44, Roland Yang, 43, and Sotheany "Teny" Hul, 42, of Diamond Bar on multiple counts of theft, fraud and forgery. The three suspects are accused of producing and selling hundreds of false certificates of insurance for workers' compensation insurance. All three were booked between March 22 and April 3, 2013 and are being held pending bail hearings.
In April 2009, the CDI Fraud Division and the Employee Development Department (EDD) began investigating Optima Staffing for defrauding their clients by producing and selling hundreds of false certificates of insurance. RJC Insurance Brokerage and Optima Staffing were allegedly selling forged certificates of insurance for workers' compensation insurance coverage.
According to detectives, the suspects facilitate the theft by establishing three payroll service companies, Optima Staffing, United Employer Services (UES) and National Employer Services (NES), in the effort to provide a legitimate facade for their fraudulent scheme.
In addition to the insurance fraud and forged certificates of insurance, Optima also allegedly evaded income and unemployment insurance taxes. In addition to the failure to pay taxes, EDD also discovered that Robinson Yang was collecting unemployment benefits while being compensated by the Optima, UES and NES.
The four-year investigation involved hundreds of victims in 19 states and losses exceeding $700,000 ...
In April 2009, the CDI Fraud Division and the Employee Development Department (EDD) began investigating Optima Staffing for defrauding their clients by producing and selling hundreds of false certificates of insurance. RJC Insurance Brokerage and Optima Staffing were allegedly selling forged certificates of insurance for workers' compensation insurance coverage.
According to detectives, the suspects facilitate the theft by establishing three payroll service companies, Optima Staffing, United Employer Services (UES) and National Employer Services (NES), in the effort to provide a legitimate facade for their fraudulent scheme.
In addition to the insurance fraud and forged certificates of insurance, Optima also allegedly evaded income and unemployment insurance taxes. In addition to the failure to pay taxes, EDD also discovered that Robinson Yang was collecting unemployment benefits while being compensated by the Optima, UES and NES.
The four-year investigation involved hundreds of victims in 19 states and losses exceeding $700,000 ...
The Department of Industrial Relations is pleased to announce the recent release of "Workers’ Compensation in California: A Guidebook for Injured Workers."
"This fourth edition of the injured workers’ guidebook helps workers and others understand the sometimes complicated process of workers’ compensation," said DIR Director Christine Baker. "The guidebook has been updated to reflect the latest changes to California’s workers’ compensation system."
The guidebook gives an overview of the California workers’ compensation system. It is meant to help workers with job injuries understand their basic legal rights, the steps to take to request workers’ compensation benefits, and where to seek further information and help if necessary. Also included are references to important laws and regulations and a glossary.
The fourth edition includes important changes since 2006 in the following areas:
The California Department of Industrial Relations enforces the state’s labor laws to improve the workplaces of over 18 million wage earners and their employers. Its mission is to improve working conditions for California's wage earners, and to advance opportunities for profitable employment in California. DIR administers and enforces laws governing wages, hours and breaks, overtime, retaliation, workplace safety and health, medical care and other benefits for injured workers, and apprenticeship training programs ...
"This fourth edition of the injured workers’ guidebook helps workers and others understand the sometimes complicated process of workers’ compensation," said DIR Director Christine Baker. "The guidebook has been updated to reflect the latest changes to California’s workers’ compensation system."
The guidebook gives an overview of the California workers’ compensation system. It is meant to help workers with job injuries understand their basic legal rights, the steps to take to request workers’ compensation benefits, and where to seek further information and help if necessary. Also included are references to important laws and regulations and a glossary.
The fourth edition includes important changes since 2006 in the following areas:
- Pre-designation of one’s treating physician or a medical group
- Treatment under the medical treatment utilization schedule (MTUS) adopted by the Division of Workers’ Compensation (DWC)
- Independent medical review (IMR) to resolve disputes over denial of treatment
- Extension of time limits on receiving temporary disability (TD) benefits
- Return-to-work procedures
- Permanent disability (PD) benefits
- Supplemental job displacement benefits (SJDB)
The California Department of Industrial Relations enforces the state’s labor laws to improve the workplaces of over 18 million wage earners and their employers. Its mission is to improve working conditions for California's wage earners, and to advance opportunities for profitable employment in California. DIR administers and enforces laws governing wages, hours and breaks, overtime, retaliation, workplace safety and health, medical care and other benefits for injured workers, and apprenticeship training programs ...
Floyd, Skeren and Kelly is pleased to announce the return of Walter Hesse as of April 5, 2013.
After an approximate year of employment at another law firm, he is once again a welcomed addition to the firm's new Westlake Village office. He brings with him over 35 years of Workers' Compensation claims experience.
As he worked his way up the ranks of the California insurance industry, Walter was tapped by FS&K to create its lien unit over a decade ago. Due to his efforts, the lien unit now flourishes and maintains over a dozen lien specialists throughout California. Recognized early in his career as a lien litigator, the IEA tapped him as an instructor. His special insight towards lien defense, coupled with his recognition, respect, and goodwill within our community, allows FS&K this proud opportunity to announce his "coming home" after a year at another law firm.
Welcome back Walter! ...
After an approximate year of employment at another law firm, he is once again a welcomed addition to the firm's new Westlake Village office. He brings with him over 35 years of Workers' Compensation claims experience.
As he worked his way up the ranks of the California insurance industry, Walter was tapped by FS&K to create its lien unit over a decade ago. Due to his efforts, the lien unit now flourishes and maintains over a dozen lien specialists throughout California. Recognized early in his career as a lien litigator, the IEA tapped him as an instructor. His special insight towards lien defense, coupled with his recognition, respect, and goodwill within our community, allows FS&K this proud opportunity to announce his "coming home" after a year at another law firm.
Welcome back Walter! ...
State Fund’s Annual Report for 2012 was just released. The report shows a significant increase in net income for California’s largest workers’ comp insurer. For 2012, State Fund’s income before dividends totaled $458 million, which was $279 million more than the prior year.
The report also indicates that State Fund reduced annual fixed expenses by $150 million dollars compared to 2009, and expects to achieve annual savings of more than $300 million by the end of 2014. These savings will help State Fund maintain fair pricing and bring value to a larger swath of the available market. State Fund announced a rate reduction of 7% effective March 1, 2013.
State Fund maintained a balanced investment portfolio that was focused on both credit quality and investment yield (99.3% of the $18.2 billion bond portfolio was rated NAIC 1, the NAIC's highest quality credit class). The weighted average credit quality of the overall bond portfolio was Aa1/AA by Moody's and Standard and Poor’s, respectively. Book yield at December 31, 2012 was 4.10%, down from 4.43% at December 31, 2011.
"I am proud to report that at the end of 2012, we began to realize our vision of a more effective State Fund, and that we are on a sustainable path to become the competitive, agile workers’ compensation carrier envisioned by our core mission," remarked Tom Rowe, State Fund President and CEO in the report.
Rowe added that, "State Fund is emerging from its restructuring stronger, more efficient, and better able to deliver value to our policyholders, and injured workers - the greatest thing we can do for Californians."
The report comes as State Fund approaches the three-year mark of implementing a comprehensive restructuring plan aimed at consolidating operations, shrinking its real estate footprint, and reducing operating expenses ...
The report also indicates that State Fund reduced annual fixed expenses by $150 million dollars compared to 2009, and expects to achieve annual savings of more than $300 million by the end of 2014. These savings will help State Fund maintain fair pricing and bring value to a larger swath of the available market. State Fund announced a rate reduction of 7% effective March 1, 2013.
State Fund maintained a balanced investment portfolio that was focused on both credit quality and investment yield (99.3% of the $18.2 billion bond portfolio was rated NAIC 1, the NAIC's highest quality credit class). The weighted average credit quality of the overall bond portfolio was Aa1/AA by Moody's and Standard and Poor’s, respectively. Book yield at December 31, 2012 was 4.10%, down from 4.43% at December 31, 2011.
"I am proud to report that at the end of 2012, we began to realize our vision of a more effective State Fund, and that we are on a sustainable path to become the competitive, agile workers’ compensation carrier envisioned by our core mission," remarked Tom Rowe, State Fund President and CEO in the report.
Rowe added that, "State Fund is emerging from its restructuring stronger, more efficient, and better able to deliver value to our policyholders, and injured workers - the greatest thing we can do for Californians."
The report comes as State Fund approaches the three-year mark of implementing a comprehensive restructuring plan aimed at consolidating operations, shrinking its real estate footprint, and reducing operating expenses ...
A federal appeals court said Pfizer Inc should pay about $142 million to cover costs for the marketing and prescribing of epilepsy drug Neurontin for unapproved uses, a practice that has also earned it a hefty criminal fine.
Reuters Health reports that a panel of appellate judges in Boston on Wednesday refused to overturn a ruling in favor of Kaiser Foundation Health Plan, which claimed it had been damaged after prescribing Neurontin for conditions it did not effectively treat, based on fraudulent marketing by Pfizer, the largest U.S. drugmaker.
In related appeals, the panel also revived similar claims from insurer Aetna and class action allegations from Harden Manufacturing Corp, restoring lawsuits that had been thrown out by a lower court. The ruling in the Kaiser case, which deals the biggest immediate blow to Pfizer, upholds a lower court's decision not to grant Pfizer a new trial after a jury had awarded it $142 million. The jury found that Pfizer had marketed Neurontin for bipolar disorder, migraines and neuropathic pain, none of which had been approved by the U.S. Food and Drug Administration. The verdict followed a $240 million criminal fine in 2004 paid by Pfizer's Warner-Lambert unit, as well as a $190 million civil fine paid by Pfizer in connection with the off-label marketing.
Neurontin, developed by a Warner-Lambert unit, was approved in 1993 to treat seizures at a maximum dose of 1800 milligrams per day. Warner-Lambert was later acquired by Pfizer. The drugmaker initially forecast about $500 million in revenue generated by Neurontin, but in 1995 began marketing it for off-label uses in an attempt to increase its earning potential -- a move that apparently worked, reaping $2 billion from Neurontin sales in 2003 alone, the appellate court said. Pfizer marketed Neurontin for off-label uses directly to doctors, sponsored misleading informational supplements and suppressed negative information about the drug, the opinion said. The company's internal marketing plan for certain drugs, including Neurontin, called for the development of relationships with Kaiser officials "who are not considered whistle blowers," according to the opinion.
In a statement, Kaiser said it was "very pleased" and that "justice has been achieved for our members and the physicians, pharmacists and staff who care for them." David Frederick, an attorney for Kaiser, said he was "gratified by the court's carefully crafted decision."
Pfizer was less satisfied, saying in a statement it believes "there was no basis in fact or law" for the awards in the Kaiser case. In the Aetna and Harden cases, Pfizer said it believed the lower court's dismissals were the right move and that it "disagrees with the conclusions" of the appeals court. "We are exploring our appellate options in all three of these cases," the company said.
Pfizer's attorneys in the case, from law firms Skadden Arps Slate Meagher and Flom and Quinn Emanuel Urquhart and Sullivan, could not be reached. The Kaiser cases are Kaiser Foundation Health Plan et al v. Pfizer Inc et al, U.S. Court of Appeals for the First Circuit, Nos. 11-1904 and 11-2096 ...
Reuters Health reports that a panel of appellate judges in Boston on Wednesday refused to overturn a ruling in favor of Kaiser Foundation Health Plan, which claimed it had been damaged after prescribing Neurontin for conditions it did not effectively treat, based on fraudulent marketing by Pfizer, the largest U.S. drugmaker.
In related appeals, the panel also revived similar claims from insurer Aetna and class action allegations from Harden Manufacturing Corp, restoring lawsuits that had been thrown out by a lower court. The ruling in the Kaiser case, which deals the biggest immediate blow to Pfizer, upholds a lower court's decision not to grant Pfizer a new trial after a jury had awarded it $142 million. The jury found that Pfizer had marketed Neurontin for bipolar disorder, migraines and neuropathic pain, none of which had been approved by the U.S. Food and Drug Administration. The verdict followed a $240 million criminal fine in 2004 paid by Pfizer's Warner-Lambert unit, as well as a $190 million civil fine paid by Pfizer in connection with the off-label marketing.
Neurontin, developed by a Warner-Lambert unit, was approved in 1993 to treat seizures at a maximum dose of 1800 milligrams per day. Warner-Lambert was later acquired by Pfizer. The drugmaker initially forecast about $500 million in revenue generated by Neurontin, but in 1995 began marketing it for off-label uses in an attempt to increase its earning potential -- a move that apparently worked, reaping $2 billion from Neurontin sales in 2003 alone, the appellate court said. Pfizer marketed Neurontin for off-label uses directly to doctors, sponsored misleading informational supplements and suppressed negative information about the drug, the opinion said. The company's internal marketing plan for certain drugs, including Neurontin, called for the development of relationships with Kaiser officials "who are not considered whistle blowers," according to the opinion.
In a statement, Kaiser said it was "very pleased" and that "justice has been achieved for our members and the physicians, pharmacists and staff who care for them." David Frederick, an attorney for Kaiser, said he was "gratified by the court's carefully crafted decision."
Pfizer was less satisfied, saying in a statement it believes "there was no basis in fact or law" for the awards in the Kaiser case. In the Aetna and Harden cases, Pfizer said it believed the lower court's dismissals were the right move and that it "disagrees with the conclusions" of the appeals court. "We are exploring our appellate options in all three of these cases," the company said.
Pfizer's attorneys in the case, from law firms Skadden Arps Slate Meagher and Flom and Quinn Emanuel Urquhart and Sullivan, could not be reached. The Kaiser cases are Kaiser Foundation Health Plan et al v. Pfizer Inc et al, U.S. Court of Appeals for the First Circuit, Nos. 11-1904 and 11-2096 ...
