West Coast Dental Administrative Services, LLC, a Delaware corporation, manages a network of dental facilities throughout California. The company provides administrative and support services to affiliated dental practices and professional corporations via support services agreements. It sources materials from outside California and, at the time relevant to this case, maintained offices and employees in both California and Washington until January 2022, with differences in employee benefits outlined in its handbook. West Coast Dental hired Sinedou S. Tuufuli as a collector and customer service representative. Tuufuli electronically signed an arbitration agreement that stipulated that any disputes related to her employment or termination would be resolved through final and binding arbitration. It explicitly stated that the agreement "shall be governed by the Federal Arbitration Act and, to the extent permitted by such Act, the laws of the State of California." In April 2023, Tuufuli filed a lawsuit against West Coast Dental, asserting eight individual and class claims for violations of various provisions of the California Labor Code and Business and Professions Code. These claims alleged labor-related issues, such as unfair compensation and working conditions, on behalf of herself and a class of similarly situated employees. West Coast Dental filed a motion to compel arbitration of Tuufuli's individual claims and to dismiss her class claims. In support, the company's human resources manager submitted a declaration affirming its Delaware incorporation, former offices in Washington, and sourcing of out-of-state materials. West Coast Dental also provided a copy of the employee handbook given to Tuufuli, which detailed interstate operations and benefits differences. Tuufuli opposed the motion, arguing that the Federal Arbitration Act (FAA) did not apply because there was no evidence of interstate commerce involvement or contemplation thereof, and that West Coast Dental operated exclusively in California. Tuufuli worked exclusively in California and testified that she rarely interacted with individuals or entities outside the state in performing her duties. The trial court granted West Coast Dental's motion. It determined that the FAA governed the agreement, relying on the evidence of West Coast Dental's interstate activities (e.g., Delaware incorporation, Washington offices, and out-of-state sourcing) as well as the explicit provision in the agreement stating it was governed by the FAA. Finally, the court dismissed Tuufuli's class claims, citing the agreement's express prohibition on class arbitration or litigation. Tuufuli appealed, challenging only the trial court's finding that the FAA applied to the arbitration agreement. She did not contest the agreement's validity or the dismissal of class claims on other grounds. The Court of Appeal affirmed the trial court's order compelling arbitration of Tuufuli's individual claims and dismissing her class claims in the published case of Tuufuli v West Coast Dental Administrative Services, LLC -B338584.PDF (January 2026). The appellate court agreed with the trial court that the FAA applied, but primarily because the parties had explicitly agreed to it in the arbitration agreement's governing law provision. It rejected Tuufuli's argument that parties cannot contractually invoke the FAA without proving interstate commerce involvement, emphasizing that arbitration under the FAA is a matter of consent, not coercion, and parties are generally free to structure their agreements as they see fit (citing Volt Information Sciences, Inc. v. Board of Trustees of Leland Stanford Junior University (1989) 489 U.S. 468, 479). The court distinguished the U.S. Supreme Court's decision in Allied-Bruce Terminix Cos. v. Dobson (1995) 513 U.S. 265, which held that the FAA applies to contracts that in fact involve interstate commerce, even if not contemplated by the parties. The appellate court clarified that Allied-Bruce did not prohibit parties from voluntarily electing FAA governance; it merely addressed the scope of "involving commerce" under 9 U.S.C. § 2. Similarly, the court rejected Tuufuli's analogy to 9 U.S.C. § 1, which expressly exempts transportation workers' contracts from the FAA regardless of agreement. Section 2, by contrast, contains no such exemption for non-interstate contracts and simply enforces arbitration provisions in contracts involving commerce (or, by extension, where parties consent to FAA application). Given this consent-based reasoning, the appellate court declined to address whether the agreement independently involved interstate commerce based on West Coast Dental's operations ...

A new California law, SB 294, effective January 1, 2026, established the Workplace Know Your Rights Act. The Act requires an employer, on or before February 1, 2026, and annually thereafter, to provide a stand-alone written notice to each current employee of specified workers’ rights. The Act also requires the employer to provide the written notice to each new employee upon hire and to provide the written notice annually to an employee’s authorized representative, if any. The notice shall contain a description of workers’ rights in the following areas: (1) The right to workers’ compensation benefits, including disability pay and medical care for work-related injuries or illness, as well as the contact information for the Division of Workers’ Compensation. (2) The right to notice of inspection by immigration agencies pursuant to subdivision (a) of Section 90.2. (3) Protection against unfair immigration-related practices against a person exercising protected rights. (4) The right to organize a union or engage in concerted activity in the workplace. (5) Constitutional rights when interacting with law enforcement at the workplace, including an employee’s right under the Fourth Amendment to the United States Constitution to be free from unreasonable searches and seizures and rights under the Fifth Amendment to the United States Constitution to due process and against self-incrimination. The notice shall also contain both of the following: (1) A description of new legal developments pertaining to laws enforced by the Labor and Workforce Development Agency that the Labor Commissioner deems material and necessary. The Labor Commissioner shall include a list of those developments, if any, in the template notice described in paragraph (a) of Section 1554. (2) A list, developed by the Labor Commissioner, of the enforcement agencies that may enforce the underlying rights in the notice. The Labor Commissioner shall include this list in the template notice described in paragraph (a) of Section 1554. An employer is required to keep records of compliance with the requirements of this section for three years, including the date that each written notice is provided or sent. The Labor Commissioner is required to develop a template notice that an employer may use to comply with the requirements of Labor Code § 1553. On or before January 1, 2026, the Labor Commissioner shall post the template notice on its internet website so that it is accessible to an employer. The Labor Commissioner shall post an updated template notice annually thereafter. The template notice shall be written in plain terminology that is easily understood by a worker. The Labor Commissioner shall make the template notice available in different languages, including English, Spanish, Chinese, Tagalog, Vietnamese, Korean, Hindi, Urdu, and Punjabi. The Labor Commissioner may also provide the template notice in additional languages. More information about this new law is available on the Labor Commissioner's website on the Required Posters and Notices page ...

California's Insurance Frauds Prevention Act (IFPA) Insurance Code § 1871-1871.10 provides tools to address insurance fraud, but it distinguishes between specific types of fraud: Section 1871.4 is limited exclusively to workers' compensation fraud. It criminalizes making knowingly false or fraudulent statements or representations to obtain, deny, or influence workers' compensation benefits, as defined under Labor Code section 3200 (which covers employee injuries arising out of employment). Section 1871.7, in contrast, is a broader qui tam provision allowing private relators (like Jerilyn Henggeler below to sue on behalf of the state for general insurance fraud. It incorporates violations of Penal Code sections 549 (soliciting or referring business for fraudulent claims), 550 (presenting false claims or concealing facts to defraud insurers), and 551 (fraudulent auto insurance claims). In October 2009, Omar Dauod was involved in a car accident while driving at high speed, colliding with another vehicle exiting a private community without fully stopping. The other driver's insurer, Farmers Insurance, paid Omar $100,000 after arbitration determined fault. Omar and his wife Gina, represented by attorney James Ballidis of the Law Offices of Allen, Flatt, Ballidis & Leslie, then pursued an underinsured motorist claim against their own insurer, Geico, seeking $400,000 - the policy limit. After arbitration in 2013 awarded them that amount, the Dauods sued Geico in December 2014 for breach of contract, bad faith, and emotional distress, alleging Geico's delays caused emotional harm, loss of two homes, and Omar's business losses as a real estate developer. Ballidis testified at the trial supporting these claims, though he did not represent them in court. A jury awarded Omar $22.9 million. Jerilyn Henggeler, a former neighbor and social acquaintance of the Dauods, learned of the verdict over a year later through news reports. Appalled, she believed the claims were fraudulent based on personal knowledge: she had observed Omar uninjured and active post-accident, knew he was a real estate salesman - not a developer - and learned from tenants that home losses stemmed from pocketing rent, not injuries. Henggeler's research into public records, including Colorado business filings, bankruptcies, lawsuits, property titles, and licenses, contradicted Omar's and Ballidis's representations about Omar's businesses, properties, and licenses. She also identified forged documents submitted to Geico, such as a letter purportedly from Omar's brother-in-law and a nonexistent entity's escrow agreement. Henggeler filed a qui tam action under Insurance Code section 1871.7 on behalf of the State of California, alleging the Dauods, Ballidis, and the Law Firm defrauded Geico through false claims and testimony. The second amended complaint included four causes: three under section 1871.4 (workers' compensation fraud statutes) for false statements, and one under section 1871.7 incorporating Penal Code violations for presenting fraudulent claims and concealing facts. The Dauods and Ballidis/Law Firm demurred, arguing the court lacked jurisdiction under the public disclosure bar (section 1871.7, subd. (h)(2)(A)), as Henggeler's claims relied on public information from news, court files, and records. The trial court sustained the demurrers without leave to amend, ruling it lacked jurisdiction due to the public disclosure bar. It found Henggeler's claims were based on publicly disclosed information: she learned of the verdict from news media, incorporated trial testimony from Omar and Ballidis, and used public records like court files and Colorado documents. The Court of Appeal reversed in the partially published case of People ex rel. Henggeler v. Dauod -G064064 (January 2026) and remanding with directions to sustain demurrers on the first three causes (workers' compensation fraud statutes) but overrule on the fourth based upon Penal Code violation. This distinction was based upon balancing qui tam policy goals. By narrowly interpreting the bar to exclude reliance on neutral public information, the court preserved Henggeler's suit as original, promoting IFPA's anti-fraud aims. Dismissing workers' compensation claims aligned with statutory limits, ensuring only valid insurance fraud allegations proceeded. This first-impression ruling clarified the bar's scope, certifying partial publication to guide future cases. The appellate court concluded that the trial court misinterpreted the public disclosure bar. It clarified the bar applies only to qui tam suits based on publicly disclosed "allegations" of fraud or specific fraudulent "transactions," not mere "information" even if related to fraud. Drawing from legislative history of the IFPA, CFCA, and federal False Claims Act, the court noted the bar's purpose: to prevent parasitic suits copying public fraud allegations while encouraging original whistleblowers. Congress and California rejected broader bars prohibiting use of public "information" or "evidence," opting for narrow limits on "allegations or transactions." Henggeler's complaint used public records (e.g., business filings, bankruptcies) and trial testimony as evidence to prove fraud, not as pre-existing fraud allegations. Testimony from Omar and Ballidis supported their claims against Geico, not accusations of fraud. No prior public disclosure alleged Respondents' fraud; Henggeler's firsthand knowledge and research formed the basis. The court upheld demurrers on the first three causes under section 1871.4, as they pertained to workers' compensation fraud without relevant allegations. It rejected other defenses: no prefiling under Civil Code section 1714.10 was needed due to Ballidis's independent duty not to defraud nonclients like Geico; collateral estoppel failed for lack of privity between the state/Henggeler and Geico ...

For the third consecutive year, both the number and frequency of work injury claims reported by California’s public self-insured employers declined last year, even as total paid and incurred workers’ compensation losses continued to rise, according to a new California Workers’ Compensation Institute (CWCI) review of data compiled by the state Office of Self-Insurance Plans (OSIP). OSIP’s summary of public self-insured claims experience, issued two weeks ago, provides preliminary workers’ comp claims data for fiscal year (FY) 2024/25, covering the 12 months ending June 30, 2025, and updated data on claims reported over the prior four years. The summary includes claims reported by cities and counties, school, fire, transit, utility and special districts, and joint powers authorities. Public self-insured entities reported that they covered nearly 2.26 million California workers in FY 2024/25, a 3.3 percent increase from the prior year, while total wages and salaries for the public self-insured workforce rose to $189.2 billion, up 8.6 percent year over year. Despite the growth in the workforce, the number of public self-insured claims in the initial report edged down slightly to 117,190, a decline of 0.8 percent from the total noted in the FY 2023/24 first reports. After adjusting for the change in the workforce, CWCI calculated an overall claim frequency rate of 5.2 claims per 100 public self-insured employees (2.4 medical-only and 2.8 indemnity claims per 100 employees). This marked the third consecutive annual decline and tied the 10-year low recorded in FY 2019/20. While claim volume and frequency fell, public self-insured claim costs continued to rise. Total paid losses at first report for FY 2024/25 claims increased to $594.9 million, up 7.6 percent from the prior year, which exceeded the previous record set during the pandemic-era surge in FY 2021/22. The average paid amount per claim rose to $5,076, which was an 8.4 percent increase year over year and nearly 68 percent higher than the 10-year low recorded in the first reports for FY 2015/16 claims. Medical costs were the primary driver of the increase. Average medical payments in the initial reports rose 13.1 percent to $2,154, the third consecutive double-digit increase and a 10-year high. Average indemnity payments increased 5.3 percent to $2,922, continuing a long-term upward trend that has seen indemnity costs climb nearly 87 percent over the past decade. First report incurred losses (paid amounts plus reserves for future payments) were also up last year, totaling more than $1.78 billion, 5.8 percent more than in FY 2023/24. The average incurred loss per claim in the initial reports increased 6.6 percent to $15,225, as average incurred medical rose 7.6 percent to $7,733, while average incurred indemnity rose 5.7 percent to $7,492. CWCI notes that first report data offer an early snapshot of new claims and will continue to develop over time. More mature data on older claims confirm ongoing growth in both paid and incurred losses. OSIP’s FY 2024/25 summary of public self-insured data, as well as historical reports dating back to FY 2000/01 are available on the California Department of Industrial Relations website here ...

Gregg Rader sustained industrial injury to the psyche and in the form of emotional stress while employed by Ticketmaster Corporation. On November 19, 2011, a WCJ approved the parties’ Stipulations with Request for Award and awarded 100 percent permanent and total disability. Applicant’s attorney requested a fee of $39,444.71, based on applicant’s life expectancy. The WCJ approved the attorney fee request and ordered that the amount of attorney fees be commuted from weekly indemnity payments by uniform weekly reduction. Accordingly, while applicant’s nominal weekly permanent disability rate was $336.00, defendant reduced each payment by $50.40, yielding a net weekly payment of $285.60. Applicant filed a Petition Amend the Award, and argued that the amount commuted from his permanent disability award has been fully satisfied, and that his weekly permanent disability indemnity should return to the nominal rate of $336.00 without reduction for additional attorney fees. Applicant’s calculations begin with the gross amount of attorney’s fees of $39,444.71, divided by the weekly commutation amount of $50.40. Applicant adds the resulting 782.63 weeks to the initial date of payment of June 6, 2008, resulting in the date of June 5, 2023 as “the date when the commutation of attorneys fees stops.” Applicant further contends that he is entitled to statutory interest per Labor Code § 5800 on any sums improperly withheld and to penalties pursuant to section 5814 and attorney’s fees pursuant to section 5814.5 for defendant’s unreasonable delay in the payment of the disputed benefits. Defendant’s Answer responds that applicant’s Award is silent as to the end date of commutation and any inference otherwise is improper. SCIF further contends that the WCAB lacks jurisdiction to alter or amend the Award at this juncture pursuant to section 5804. The WCJ found that the Workers’ Compensation Appeals Board (WCAB) lacks jurisdiction to amend the applicant’s prior Award of permanent disability, and that applicant has not proven that additional indemnity payments are due beyond what is specified in the Award. The WCAB granted reconsideration in the Significant Panel Decision of Gregg Rader v Ticketmaster -ADJ7138762 (January 2026) and substitute new Findings of Fact that the WCAB retains ongoing jurisdiction over the award of attorney’s fees pursuant to section 5803, and that because defendant has taken credit from applicant’s weekly payment of permanent indemnity in an amount equivalent to the dollar amount of commuted attorney’s fees, applicant is thereafter entitled to the full amount of his award without further reduction for attorney’s fees. The panel noted that WCAB maintains exclusive jurisdiction pursuant to the California Constitution and Labor Code § 5300 to adjudicate workers’ compensation disputes.” (Dennis v. State of California (2020) 85 Cal.Comp.Cases 28 [2020 Cal. Wrk. Comp. LEXIS 1] (Appeals Board en banc).) The Appeals Board has continuing jurisdiction over all its orders, decisions, and awards made and entered. (Lab. Code, § 5803.) The Appeals Board may rescind, alter, or amend any order, decision, or award, for good cause. However, section 5804 provides that “[n]o award of compensation shall be rescinded, altered, or amended after five years from the date of the injury.” As explained by our Supreme Court, the WCAB “is empowered with continuing jurisdictional authority over all of its orders, decisions and awards … However, this power is not unlimited … The WCAB’s authority under section 5803 to enforce its awards, including ancillary proceedings involving commutation, penalty assessment and the like, is not to be confused with its limited jurisdiction to alter prior awards by benefit augmentation at a later date. The latter action is subject to the provisions of sections 5410 and 5804.” (Nickelsberg v. Workers’ Comp. Appeals Bd. (1991) 54 Cal.3d 288, 297 [56 Cal.Comp.Cases 476].) Thus, in contrast to the limitations imposed by the statute on the Appeals Board to augment previously awarded benefits or to set aside an entire award, the Appeals Board continues to have jurisdiction after five years to enforce its awards. (Barnes v. Workers’ Comp. Appeals Bd. (2000) 23 Cal.4th 679, 687 [65 Cal.Comp.Cases 780].) That is, the WCAB’s jurisdiction to enforce an award extends beyond section 5804’s five-year limitations period because an order ascertaining and fixing the exact amount of liability does not rescind, alter or amend any prior award in violation of section 5804. (Id.) In Garcia v. Industrial Acci. Com. (1958) 162 Cal.App.2d 761, the Court of Appeal concluded that the “award of compensation to the employee is not altered or amended within the intended meaning of sections 5803 and 5804 by the allowance of the attorneys’ lien after the five- year period.” (Id. at p. 767.) In Garcia, new attorneys substituted in more than five years after the date of injury to assist the injured worker in resisting a petition to reopen the case by defendant Subsequent Injuries Fund (now Subsequent Injuries Benefits Trust Fund). (Id. at pp. 762-763.) The Garcia court reasoned, “[t]he imposition of the attorneys’ lien after the five-year period would only amount to a reallocation or redistribution of the funds to be paid under the original award of compensation, i.e., the award of compensation is the same, only its payments are ultimately redirected by the imposition of a charge upon the award as security for the reasonable fee allowed 5 by the commission for legal services performed on behalf of the employee by his attorneys.” (Id. at p. 767, italics added.) Thus, the court determined that the underlying award of compensation remained the same even if a lien for attorney’s fees was allowed. (Id. at p. 767.) Pursuant to the above authorities, the Appeals Board retains the jurisdiction under section 5803 to make collateral changes to an award so long as the merits of the basic decision determining the worker’s right to benefits are not altered, and the amount of benefits remains unchanged. The panel concluded that the lateral commutation of attorney’s fees from an award of lifetime benefits is limited to the specified amount of attorney’s fees approved by the WCJ or the Appeals Board in the first instance. Once defendant has deducted an aggregate amount commensurate with the specified commuted attorney’s fees, no further deduction from applicant’s weekly indemnity payment is appropriate or permissible." ...

Khursheed Haider, 50, of Roseville, was sentenced by U.S. District Judge Dena M. Coggins to 9 years in prison for distribution of child sexual abuse material, U.S. Attorney Eric Grant announced. Khursheed Haider was a 2000 graduate of the Hamdard College of Medicine & Dentistry located in Karachi, Pakistan. The California Medical Board reflects that the Physician and Surgeon license belonging to Khursheed Haider is currently revoked following his plea of guilty in this case. According to court documents, Haider, a Sacramento Area pulmonologist, used an application called Wire to post, distribute, and request videos and images of prepubescent boys and girls being sexually abused. After a search warrant was executed, agents discovered more than 600 images and videos of prepubescent child sexual abuse material on Haider’s electronic devices. Haider was charged in a two-count indictment with a Count 1 One violation of Title 18 United States Code, Section 2252(a)(2), Distribution of Child Pornography, and a Count Two violation of Title 18 United States Code, Section 2252(l)(4)(B), 3 Possession of Child Pornography. Both criminal counts were charged as felonies. On or about 4 June 18, 2025, pursuant to a plea agreement. He pled guilty to Count One, Haider admitted in his Plea Agreement that on or about October 30, 2023, he shared a 45-second long mp4 video of a minor child being sexually abused by an adult male in an on-line group dedicated to sharing images of child sexual abuse. Haider admitted he was aware that the child depicted in the video was a minor and that he knowingly distributed the video. In addition, Haider admitted that he also shared additional videos and content that showed sexual abuse of other minor children and babies. According to the factual basis, the Federal Bureau of Investigation conducted a forensic review of Haider's electronic devices and found more than 600 images and videos of child sexual abuse material. Haider signed the factual basis on June 18, 2025, and acknowledged that the contents of the factual basis was accurate. “Today’s sentence holds Khursheed Haider accountable for his proliferation of child sexual abuse material, each instance of which retraumatizes the victims shown in such material,” said U.S. Attorney Grant. “My office is committed to investigating and prosecuting individuals who traffic in this abusive material, including those in positions of trust like Haider.” “Khursheed Haider was known to many as a trusted physician and family man,” said FBI Sacramento Special Agent in Charge Sid Patel. “However, he was a predator behind that facade who actively shared material depicting the horrific sexual abuse of infants and toddlers. The FBI works tirelessly to identify and apprehend individuals who consume and distribute child sexual abuse material to stop the ongoing victimization of our nation’s most vulnerable and innocent victims.” This case was the product of an investigation by the Federal Bureau of Investigation. Assistant U.S. Attorney Jason Hitt prosecuted the case. This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute those who sexually exploit children, and to identify and rescue victims ...

An Orange County Superior Court judge was federally charged on January 7 with defrauding California’s workers’ compensation program. Israel Claustro, 50, was charged via information with one count of mail fraud, a crime that carries a statutory maximum sentence of 20 years in federal prison. Claustro signed a plea agreement in which he agreed to plead guilty to the felony charge. Claustro is expected to make his initial appearance on January 12 in United States District Court in Santa Ana. Claustro has agreed to resign from his position as an Orange County Superior Court judge. According to the plea agreement, Claustro – who was an Orange County prosecutor at the time of the fraud – operated Liberty Medical Group Inc., a Rancho Cucamonga-based medical corporation, despite being neither a physician nor a medical professional as required under California law. One of Liberty’s employees was Dr. Kevin Tien Do, 60, of Pasadena, a physician who had served a one-year federal prison sentence after being convicted in 2003 of felony health care fraud. Because of this conviction, in October 2018, Do was suspended from participating in the California’s workers’ compensation program. Claustro was aware of Do’s prior criminal conviction and suspension from California’s workers’ compensation program. According to the plea agreement, Claustro admitted that he defrauded California’s Subsequent Injuries Benefits Trust Fund (SIBTF), a special fund administered by California’s workers’ compensation program to provide additional compensation to injured workers who already had a disability or impairment at the time of a subsequent injury. Specifically, Claustro paid Do more than $300,000 for preparing medical evaluations, medical record reviews, and med-legal reports after Do’s suspension. Claustro caused Liberty to mail these reports to California’s SIBTF, concealing that they were prepared by Do by listing other doctors’ names on the billing forms and reports. Based on these fraudulent submitted reports, Liberty received hundreds of thousands of dollars from SIBTF. The loss amount from Claustro’s participation in this scheme is approximately $38,670 – the amount SIBTF paid to Liberty based on reports Claustro knew Do had drafted after his suspension from SIBTF. In connection with this scheme, Do pleaded guilty in January 2025 to one count of conspiracy to commit mail fraud and one count of subscribing to a false tax return. Do is expected to be sentenced in the coming months. “Judge Claustro violated the law for his personal financial benefit,” said First Assistant United States Attorney Bill Essayli. “We will not hesitate to prosecute anyone – judges included – who defraud public benefits intended to help those in need.” The FBI, IRS Criminal Investigation, and the California Department of Insurance are investigating this matter.Former Special Assistant United States Attorney Stephanie Orrick of the Orange County Office prosecuted this case ...

The California Insurance Commissioner and newly-appointed Senate Insurance Committee Chair Steve Padilla announced Senate Bill 876, a comprehensive legislative reform to speed up disaster recovery for homeowners and renters through improved insurance coverage and expanded consumer protections. They are proposing legislation directly responding to wildfire disaster survivors’ call for swifter claims payments and an end to delays and runarounds by insurance companies. The Department of Insurance said that "The payment of insurance claims from insurance companies for the Los Angeles wildfires is already the fastest on record, with $22.4 billion distributed since January 2025, along with $6 billion in federal, state, local, and private donations committed. According to the DOI press release the "Disaster Recovery Reform Act, authored by Senator Padilla, aims to cut red tape, improve payouts, and end delays and runarounds by insurance companies." - - Requiring a “disaster recovery plan” from insurers for handling claims and meeting timelines - reviewed by the Department in advance and put into effect in an emergency situation. - - Doubling penalties during a declared emergency for violations of insurance fair claims practices and settlement law. - - Requiring insurance companies pay restitution directly to policyholders when they violate the law. - - Addressing delays resulting from the assigning of multiple adjusters by requiring insurance company status reports to policyholders within 5 days anytime a new adjuster is assigned. - - Improving recovery by expanding policy limits for Additional Living Expenses by 100% in a declared disaster. - - Expanding up-front payments by requiring Actual Cash Value and structure replacement cost be paid quickly following a total loss, with interest payable if late. - - Providing adequate recovery funds by requiring a mandatory offer of extended and guaranteed replacement cost coverage when writing a policy, and regular updated replacement cost estimates for new business and renewals. - - Safer rebuilding by applying mandatory building code upgrade coverage at the time of rebuild - not at the time of loss - to account for updated rules. The DOI said that this "legislation builds on major legislative reforms that Commissioner Lara sponsored last year after the Los Angeles wildfires. These newly enacted laws establish a wildfire safety grant mitigation program, expand insurance discounts, speed up claim payouts for wildfire survivors, extend non-renewal moratorium protections to businesses, strengthen the financial stability of the FAIR Plan, and modernize outdated insurance laws to improve transparency and accountability." ...

Stanley Ellicott has been sentenced to a term of three years in State Prison after pleading guilty and being convicted of seven felony counts of public corruption in connection to a complex scheme that defrauded the city of San Francisco of more than $627,000 directly from the Department of Human Resources’ Division of Workers’ Compensation, and another case where he aided and abetted public corruption. Ellicott was remanded into custody and is currently in San Francisco County Jail, awaiting transfer to the California Department of Corrections and Rehabilitation’s custody in State Prison. Ellicott pled guilty and was convicted of two counts of misappropriation of public moneys, grand theft, financial conflict of interest, presentation of fraudulent claim, money laundering, and aiding and abetting a financial conflict of interest in a government contract. His guilty plea and conviction settled two fraud cases he was facing. Ellicott was born and raised in Maine. He earned a Bachelor of Arts degree from Wheaton College and a Master of Public Policy from the University of California, Berkeley's Goldman School of Public Policy. Prior to his roles with the City and County of San Francisco, where he began working on and off in 2012, Ellicott was employed as an associate analyst at Moody's. Over a four-and-a-half-year period from May of 2019 to January of 2024, Ellicott stole $627,118.86 from the City, where he previously served as the Assistant Director of Finance and Technology for the Human Resources Department, Workers’ Compensation Division. One of his responsibilities was to oversee “the financial integrity of the Workers’ Compensation Division.” Ellicott enlisted a friend to register a fake business in Illinois called “IAG Services” and open a bank account for the business, which she gave full control of to Ellicott. Ellicott then added this fake business as a vendor in the workers’ compensation system and over time billed more than 600 actual City workers’ compensation claims with charges for auditing services. Department archives show no evidence any auditing services were ever performed. Because the City is self-insured for workers’ compensation purposes, payments to doctors, employees, and vendors related to workers’ compensation claims come directly from the City’s coffers. All the City payments to “IAG Services” were deposited into the account set up by Ellicott’s friend, then the money was systematically transferred into Ellicott’s personal checking accounts in a pattern to appear like they were payroll payments. In total, he transferred more than $488,000 from IAG’s account into accounts belonging to him. The website for the Illinois business “IAG Services” created in Oakland – where Ellicott lives – and IAG emails sent to Ellicott’s work address that appear to be created by him. On several occasions, Ellicott emailed his subordinates and directed them to process payments to IAG that he had approved, enlisting their unknowing and unwitting assistance in his fraud. Ellicott also pled guilty to and was convicted in a separate case for his role in a scheme to misappropriate grant funds awarded through the City’s Community Challenge Grant Program. The cases against Ellicott were prosecuted by Assistant District Attorney Erin Loback, with assistance from District Attorney Investigator Mike Reilly, paralegal Chloe Mosqueda and the entire Public Integrity Task Force. Investigators were able to locate and freeze all of the stolen funds before he was arrested. The stolen $627,118.86 back to the City’s Worker’s Compensation Fund.” ...

Charles River Laboratories, Inc. (CRL), successor by merger to Explora Biolabs Holdings, Inc., has agreed to pay $1,000,000 to resolve allegations that Explora engaged in the unlawful manufacturing and distribution of controlled substances between 2019 and 2022 in violation of the Controlled Substances Act (CSA). CRL also entered into a separate agreement with the U.S. Drug Enforcement Administration (DEA) that contains provisions to ensure the company’s compliance with the CSA over the next three years. Explora, a provider of contract vivarium research services, was previously registered with the DEA for its facilities in South San Francisco and San Diego. Both facilities held Researcher registrations, which generally do not authorize the manufacture or distribution of controlled substances. Explora was acquired by CRL in April 2022 for approximately $295 million in cash, as part of CRL's expansion into contract vivarium research services, but public SEC filings from CRL do not delve into the specifics of the pre-acquisition violations or any internal investigations. Charles River Laboratories, Inc. (CRL) operates as a contract research organization (CRO) in California, providing products and services to support drug discovery, early-stage development, and manufacturing for pharmaceutical and biotechnology clients. Their operations in the state include rodent breeding facilities in Hollister, as well as multiple Charles River Accelerator and Development Lab (CRADL) sites offering turnkey rentable vivarium spaces and in vivo research support services in regions like the San Francisco Bay Area and Thousand Oaks. This includes contract vivarium management, preclinical testing, and related infrastructure for biotech companies. A vivarium is an enclosed area or container designed for keeping and raising live animals or plants under conditions that simulate their natural environment, typically for observation, research, or as pets. It can range from simple glass terrariums for small reptiles or insects to larger laboratory facilities for scientific studies. In research contexts, like those involving biotech or pharmaceutical companies, vivariums often house animal models (such as rodents) for preclinical testing and must meet strict standards for humidity, temperature, lighting, and biosecurity. U.S attorneys alleged that Explora nevertheless engaged in those activities at its South San Francisco and San Diego facilities without the appropriate registration. Based on its investigation, they claimed that Explora unlawfully manufactured and distributed controlled substances in at least 178 instances, in violation of provisions of the CSA that closely regulate the manufacture, distribution, dispensation, importation, and exportation of controlled substances, and that Explora also violated multiple recordkeeping requirements of the CSA. The United States alleged that CRL has successor liability for Explora’s violations of the CSA, but does not allege that CRL itself violated the CSA. “DEA registrants play a critical role in protecting the public and that responsibility starts with strict compliance to the Code of Federal Regulations,” said San Diego Division DEA Special Agent in Charge James Nunnallee. “When or if a company chooses to ignore these obligations, it puts communities at risk and undermines the safeguards designed to keep the public safe. DEA holds registrants accountable and in turn, expects them to keep the public safe.” Assistant U.S. Attorney Michael Pyle handled this matter for the government. The investigation and settlement resulted from a coordinated effort by the U.S. Attorney’s Office for the Northern District of California, and DEA Diversion Investigators in San Francisco and San Diego. There is no indication that litigation was filed in court regarding this case. The matter was resolved through a civil settlement agreement with the U.S. Department of Justice to address the allegations of Controlled Substances Act violations, without any formal complaint or lawsuit being initiated in a judicial proceeding. The claims resolved by the settlement are allegations only; there has been no determination of liability ...

Anthony Romero began his career with the Kern County Fire Department in October 1999 as a fireman. Over the years, he received positive performance reviews, earned certifications in fire prevention and code enforcement, and advanced through the ranks, becoming an engineer in 2009 and a captain in 2019. In January 2020, Romero discovered that fire extinguishers on the county's fire engines were being improperly serviced, which he believed posed a safety hazard and violated various laws and regulations. He reported these concerns verbally to his battalion chief and in writing to the deputy chief, who forwarded the complaint to the fire marshal. Shortly after, Romero received a text from the assistant fire marshal banning him from working in the fire marshal's office or in fire prevention roles. Romero alleged this ban was retaliatory, but his internal complaints were dismissed, with the county citing "unauthorized overtime" as the reason. In April 2020, he filed an internal relations complaint with the county's Human Resources office, which was denied in July 2020. He escalated the issue to the Kern County Civil Service Commission in the fall of 2020 but withdrew it after assurances from the fire chief that it would be handled internally. Tensions escalated in January 2022 when Romero was notified of an investigation into possible misconduct, leading to his placement on administrative leave four months later. On October 4, 2022, the county terminated his employment, citing violations of civil service and fire department rules. Romero then filed a claim under the Government Claims Act on March 24, 2023, which the county rejected on May 8, 2023. In September 2023, Romero sued the County of Kern in superior court, alleging wrongful termination in retaliation for his whistleblower activities in violation of Labor Code sections 1102.5, 6310, and 98.6. He filed a first amended complaint the following month, reiterating these three causes of action. After answering the complaint, the county moved for judgment on the pleadings, arguing that Romero failed to exhaust internal administrative remedies under Ordinance Code section 3.04.080 and related civil service rules, which require appealing dismissals to the Civil Service Commission. The trial court ruled that Romero's lawsuit was jurisdictionally barred because he failed to exhaust administrative remedies by appealing his termination to the Kern County Civil Service Commission under Ordinance 3.04.080 and rule 1700 et seq. It accepted the county's argument that these procedures for challenging dismissals applied to Romero's claims, regardless of their whistleblower retaliation basis. The Court of Appeal reversed the judgment in the published case of Romero v County of Kern -F088325 (December 2025) concluding Romero was not required to exhaust the county's internal remedies because they did not apply to or adequately address whistleblower retaliation claims. The appellate court examined the exhaustion doctrine, noting that administrative remedies must be exhausted as a jurisdictional prerequisite where provided by statute or internal rules, as established in cases like Abelleira v. District Court of Appeal (1941) 17 Cal.2d 280 and Campbell v. Regents of University of California (2005) 35 Cal.4th 311. However, exceptions apply if remedies are unavailable, inadequate, or outside the agency's jurisdiction, as in Lloyd v. County of Los Angeles (2009) 172 Cal.App.4th 320, where whistleblower claims fell outside discrimination-focused rules. The court analyzed Kern County's ordinances and rules. It agreed rule 1810 et seq. (for discrimination and harassment) did not apply to whistleblower retaliation. Focusing on Ordinance 3.04.080 and rule 1700 et seq. (for dismissals), it found these provided procedures for challenging disciplinary actions but lacked "clearly defined machinery" for submitting, evaluating, and resolving whistleblower retaliation complaints specifically. The rules required the commission to address only the appointing authority's stated grounds for dismissal, not alternative claims like retaliation. Arguments were limited to rule violations, and the commission was not obligated to investigate or make findings on retaliation. This contrasted with explicit procedures for discrimination claims and cases like Campbell, where specific whistleblower policies existed. The court distinguished the county's position: while an employee might raise retaliation defensively, the commission was not required to address it, failing to promote exhaustion's purposes like factual development or judicial economy. It cited precedents where optional or non-mandatory processes do not trigger exhaustion (e.g., City of Coachella v. Riverside County Airport Land Use Com. (1989) 210 Cal.App.3d 1277 ...

Manuel Contreras worked for Green Thumb Produce, Inc., a produce packaging company, from 2016 to 2020, primarily in the sanitation department driving forklifts. During his employment, he discovered he was being paid less than other employees performing similar duties, including some with less seniority. He raised this pay disparity with his supervisors multiple times, but no action was taken. In August 2020, Contreras researched his legal rights, believing the law required equal pay for equal work. He contacted the Labor Commissioner's Office in San Bernardino County, where a deputy labor commissioner suggested Green Thumb might be violating the law and referred him to the California Equal Pay Act (EPA) and the office's website. Contreras reviewed a seven-page FAQ document titled "California Equal Pay Act: Frequently Asked Questions," which he interpreted as applying to his situation, even though he did not believe the pay difference was due to his gender, race, or ethnicity. On September 3, 2020, he brought the FAQ to work to request a raise from human resources. During lunch, he discussed it with coworkers to find a witness, leading to an encounter with his manager, Miguel Ramos, who took him to HR manager Sendy Ochoa. Contreras explained the FAQ and requested a raise, but Ochoa denied it, accused him of insubordination after he stated he would no longer drive a forklift (meaning additional duties, not his primary one), and sent him home. The next day, Contreras was terminated via security escort and a letter citing violations of company policies, such as disrupting work and refusing instructions. In 2021, Contreras sued Green Thumb Produce, Inc., for wrongful termination. In his operative first amended complaint filed in 2023, he asserted three causes of action under the California Labor Code: (1) retaliation for exercising employment rights (§ 98.6), (2) whistleblower retaliation (§ 1102.5(b)), alleging he was fired for reporting a believed EPA violation, and (3) retaliation for discussing wages (§ 232). The case proceeded to a jury trial in 2023. The jury found in Contreras's favor on all three claims, awarding $53,000 in past economic damages, $72,428 in future economic damages, and $47,000 in past non-economic damages, totaling $172,428, plus statutory penalties. After the verdict, Green Thumb filed a motion for partial judgment notwithstanding the verdict (JNOV) on August 18, 2023, challenging only the whistleblower retaliation claim under § 1102.5(b). The trial court granted the partial JNOV, ruling that Contreras's testimony showed he had not complained of any actual legal violation and could not "make up a non-existent law" for § 1102.5 protections. It entered a second amended judgment on November 20, 2023, reducing penalties to $10,000 (for § 98.6 only) and awarding Contreras $182,428 total. Contreras appealed this ruling, arguing substantial evidence supported the jury's finding of his reasonable belief in an EPA violation. The Court of Appeal reversed the JNOV ruling and directed the trial court to reinstate the jury's verdict in the published case of Contreras v Green Thumb Produce -D085440 (December 2025). The Court of Appeal first clarified that § 1102.5(b), California's whistleblower statute, protects employees from retaliation for disclosing information they reasonably believe reveals a legal violation, emphasizing objective reasonableness without requiring proof of an actual violation. It rejected Green Thumb's argument that a mistaken legal interpretation automatically defeats a claim, identifying three scenarios of employee mistakes (law, facts, or both) and focusing on reasonableness to align with the statute's purpose of encouraging reports without fear. The court dismissed hypotheticals of patently unreasonable beliefs (e.g., mandatory 100% raises) as failing the objective reasonableness test. It then found substantial evidence supporting the jury's verdict: Contreras's consultation with a deputy labor commissioner (who suggested a possible violation), his lay interpretation of the FAQ (which often omitted protected classes and could mislead a non-lawyer), and his testimony. The FAQ's structure, starting with expansions beyond original gender protections and questions like 9 focusing on "substantially similar work," supported a reasonable lay misinterpretation, especially given the EPA's name and Contreras's limited education. The court distinguished this from cases where no legal foundation was cited, noting Contreras pointed to the EPA as his basis ...

Alberto Mendoza began working as a Ventura County Deputy Sheriff in 2012, assigned to the Todd Road Jail Facility. In December 2014, he suffered a back injury after slipping on stairs, causing lower back discomfort. In May 2015, he sustained another back injury when an inmate kicked him in the right waist area during a subdue attempt. An MRI in May 2015 revealed degenerative disc disease at the L5-S1 level, a disc herniation abutting the right S1 nerve root, and extrusion of nucleus pulposus material also affecting the nerve root. Mendoza was evaluated by several doctors. Dr. Robert Fields, the Qualified Medical Evaluator in his workers' compensation case, recommended referral to a spine specialist and noted a high likelihood of needing surgery. Dr. Brian Grossman, an orthopedic surgeon, initially suggested physical therapy and an epidural injection but later concluded Mendoza had reached maximal medical improvement without surgery, though he discussed microscopic discectomy as an option; Mendoza declined, citing colleagues' negative experiences. Dr. Sam Bakshian, his treating physician, reported worsening symptoms post-injection and requested authorization for a hemilaminectomy microdiscectomy at L5-S1, which the County authorized, but Mendoza refused due to fears and concerns about outcomes. Subsequent MRIs in December 2015 and June 2017 showed progression of discopathy. Dr. Fields reevaluated Mendoza in 2016, urging surgery with a 90% chance of good to excellent results, allowing potential return to work. Mendoza continued to decline. By 2017, Dr. Bakshian recommended a more extensive laminoforaminotomy discectomy due to scar formation and annular tearing, but this was denied via utilization review for lack of objective evidence. Dr. Richard Rosenberg evaluated Mendoza in 2018 and 2019, opining he no longer needed surgery, had lost less than 5% lifting capacity, and could return to most deputy duties with accommodations, recommending a home exercise program and work hardening; Mendoza stopped the exercises due to pain and declined work hardening. Mendoza testified at an administrative hearing that he refused surgery because his urinary incontinence resolved and he believed his body was improving, though he reported constant pain. The County presented evidence from radiologist Dr. Stephen Rothman that the 2017 MRI showed no nerve compression, and testimony that accommodations were possible. A supplemental report from Dr. Bakshian in 2020 agreed the disc extrusion resolved but noted significant disc height loss and dysfunction, now requiring decompression, neurolysis, and possibly fusion. In May 2016, Mendoza applied for service-connected disability retirement benefits with the Ventura County Employees' Retirement Association (VCERA). The County challenged the application, leading to an administrative hearing before a VCERA hearing officer in December 2019. The hearing officer issued proposed findings in October 2020, recommending denial because Mendoza unreasonably refused surgery with a high success probability (90% per Dr. Fields), stopped his home exercise program, and declined work hardening, potentially worsening his condition. The Board adopted this decision, denying benefits. Mendoza then petitioned the Ventura County Superior Court for a writ of administrative mandate under Code of Civil Procedure section 1094.5, challenging the Board's denial as an abuse of discretion and unsupported by evidence. The trial court denied Mendoza's writ petition, exercising independent judgment and upholding the Board's findings. The court held Mendoza's delay worsened his condition, making his disability self-inflicted rather than service-connected. Substantial evidence, including uncontradicted medical opinions, supported this, and Mendoza failed to meet his burden. The Court of Appeal affirmed the trial court's denial, in the published opinion of Mendoza v. Bd. of Retirement of the Ventura County Employee's Retirement Association -B327347 (December 2025). It reasoned that allowing benefits despite unreasonable refusal would undermine the doctrine's purpose: preventing employees from relying on unfounded fears to reject treatment and claim disability. The appellate court reviewed for substantial evidence supporting the trial court's findings, given Mendoza's vested right to benefits required independent judgment. It presumed the administrative findings correct, with Mendoza bearing the burden to show otherwise. The court applied the doctrine of avoidable consequences, which denies benefits if disability is caused, continued, or aggravated by unreasonable refusal of treatment with inconsiderable risk relative to injury severity. The court found substantial evidence for the unreasonable refusal: recommendations from three doctors (Bakshian, Fields, Grossman), Dr. Fields' 90% success opinion outweighing risks, and Mendoza's fears based on anecdotal information. It noted conflicts in Dr. Bakshian's testimony but deemed them insufficient to compel reversal. The court also upheld findings on refusal of work hardening and home exercises, and forfeiture of Mendoza's sufficiency claim for omitting favorable evidence in his brief. It reasoned that allowing benefits despite unreasonable refusal would undermine the doctrine's purpose: preventing employees from relying on unfounded fears to reject treatment and claim disability ...

Veronica McRae filed a claim with the U.S. Department of Labor (DOL) for death benefits as the alleged widow of a deceased worker who had been injured at the Port of Oakland and later passed away. Homeport Insurance, the insurer for the employer, participated in mediation and reached a settlement with McRae. Pursuant to an application under federal law, an administrative law judge (ALJ) issued an order approving the settlement, requiring Homeport to pay McRae $425,000 for all claims related to disability, medical, and death benefits, and an additional $30,000 directly to her attorneys - Philip Weltin, Daniel Weltin, and their firm, Weltin, Streb & Weltin, LLP - for fees and costs. Approximately nine months later, the decedent's daughter informed Homeport that her father had not been married to McRae at the time of his death. Homeport's investigation revealed a 2010 judgment dissolving the marriage between McRae and the decedent, as well as McRae's unsuccessful 2022 motion to set aside that default judgment. Homeport then moved with the DOL to vacate the ALJ's order, alleging it was procured through McRae's fraud. While that motion was pending, Homeport initiated a state court lawsuit in Alameda County Superior Court against McRae and her attorneys asserting claims for conversion, imposition of a constructive trust, unjust enrichment, and injunctive and declaratory relief. It also sued McRae separately for fraud. The attorneys filed a special motion to strike Homeport's complaint under California's anti-SLAPP statute (Code Civ. Proc., § 425.16), arguing that the claims arose from their protected petitioning activity in representing McRae in the administrative proceeding. They contended Homeport could not prevail because it had no ownership interest in the attorney fees (which were ordered paid directly by the ALJ), the litigation privilege (Civ. Code, § 47) barred liability, and the economic loss rule applied. Homeport opposed the motion, arguing it was untimely, the claims did not arise from protected activity (but rather McRae's fraud, which was not a public issue), the illegality exception to anti-SLAPP applied, and it had a probability of prevailing based on evidence of McRae's misrepresentation and its right to the funds. The trial court granted the attorneys' anti-SLAPP motion and struck Homeport's complaint in its entirety. The Court of Appeal affirmed the trial court's order striking the complaint in the unpublished case of Homeport Insurance v. McRae -A172243 (December 2025). The Court of Appeal conducted a de novo review, applying the two-prong anti-SLAPP framework. On prong one (protected activity), the court focused on whether the attorneys' conduct giving rise to liability fell under section 425.16, subdivision (e) - statements or writings in judicial or official proceedings. It concluded that Homeport's claims, particularly the conversion claim (from which the others derived), arose from the attorneys' prosecution of McRae's allegedly fraudulent LHWCA claim and the procurement of the ALJ order. The court emphasized that the "wrongful act" element of conversion was tied to these petitioning activities, not merely the receipt of funds. It distinguished cases like Drell v. Cohen (2014) and Optional Capital, Inc. v. DAS Corp. (2014), where protected activity was incidental, and analogized to Rusheen v. Cohen (2006), where noncommunicative acts (like levying on property) were protected if necessarily related to privileged communications. The court rejected Homeport's argument that the attorneys failed to identify specific protected acts, as the claims were not "mixed" but entirely based on protected conduct. It also dismissed the illegality exception from Flatley v. Mauro (2006), finding no conclusive evidence that the attorneys knowingly made false representations under the LHWCA's fraud provision (33 U.S.C. § 931(a)). On prong two (probability of prevailing), the court held that Homeport failed to meet its burden. It noted Homeport forfeited any challenge to the litigation privilege by not addressing it in its opening brief, but even on the merits, the privilege applied to communications and related acts in the administrative proceeding, including receipt of fees under the ALJ order. Drawing again from Rusheen, the court reasoned that the attorneys' retention of funds was not an independent wrong but stemmed from the privileged prosecution of the claim. Homeport also failed to show conversion, as it lacked evidence of a right to the fees or wrongful possession by the attorneys. The court dismissed Homeport's reliance on a temporary restraining order against McRae (obtained before the attorneys appeared) and other undeveloped arguments, such as public interest concerns or comparisons to New York and Texas law. The court remanded for the trial court to determine the attorneys' appellate attorney fees and costs under section 425.16, subdivision (c), as prevailing defendants are entitled to them ...

The California FAIR Plan Association (CFPA), established under the Basic Property Insurance Law (Ins. Code, §§ 10090–10100.2) as the state's insurer of last resort, challenged an order issued by Insurance Commissioner Ricardo Lara on September 24, 2021 (Order No. 2021-2). The order directed CFPA to amend its plan of operation to offer a "Homeowners Policy" that included, among other coverages, premises liability and incidental workers' compensation - elements not part of CFPA's existing dwelling fire policy. CFPA petitioned the Los Angeles County Superior Court for a writ of mandate to vacate the order, arguing that the Commissioner lacked authority under the statute to mandate liability coverage, as "basic property insurance" is limited to first-party coverage against direct loss to real or tangible personal property. The superior court denied the petition, finding the statutory definition ambiguous and deferring to the Department of Insurance's (DOI) interpretation, which permitted liability coverage if it had some connection to the property. On appeal, the central issue was whether Insurance Code section 10091, subdivision (c), authorizes the Commissioner to expand "basic property insurance" to include liability coverage. The California Court of Appeal ruled that it did not, and reversed the trial court In the published case of California FAIR Plan Association v. Lara -B336043 (December 2025). The statute defines the term as "insurance against direct loss to real or tangible personal property at a fixed location . . . from perils insured under the standard fire policy and extended coverage endorsement, from vandalism and malicious mischief, and includes other insurance coverages as may be added with respect to that property." The court agreed the phrase "other insurance coverages . . . with respect to that property" is ambiguous, as it could plausibly refer to additional first-party perils or broader coverages, including liability. However, after examining extrinsic aids, the court concluded the Legislature intended "basic property insurance" to encompass only first-party property coverage. The law was enacted in 1968 amid instability in California's property insurance market, triggered by urban riots (e.g., Watts in 1965) and wildfires, which left property owners in high-risk areas unable to obtain basic fire insurance. It mirrored the federal Urban Property Protection and Reinsurance Act of 1968, which incentivized states to create "FAIR" (Fair Access to Insurance Requirements) plans to ensure residual market access for property risks, not liability. The statute's express purposes (§ 10090) - stabilizing the property insurance market, assuring availability of basic property insurance, encouraging maximum use of the normal market, and equitably distributing responsibility among property insurers - all align with first-party property risks. Expanding to liability would undermine these goals by distorting CFPA's role as a backstop, disincentivizing voluntary market use (where liability via Difference in Conditions policies is readily available), and unfairly burdening non-property insurers. The court further held that deference to DOI's interpretation was unwarranted under Yamaha Corp. of America v. State Bd. of Equalization (1998) 19 Cal.4th 1. DOI's 1972 report to the Legislature, contemporaneous with enactment, confirmed the law's narrow focus on property insurance. Its 1994 shift - approving CFPA's Businessowners Policy with liability coverage - was not consistently maintained, lacked formal rulemaking, and rested on flawed reasoning solicited to avert legislative intervention after the 1992 Los Angeles riots. DOI possessed no comparative interpretive advantage, as the issue turned on statutory construction rather than technical expertise. The judgment was reversed, and the matter remanded with directions to grant the writ and vacate Order No. 2021-2. CFPA was awarded costs on appeal ...

Litigation originated against Sierra Pacific Industries in October 2018 when plaintiff Quinton McDonald, a former nonexempt employee at one of Sierra Pacific's California sawmills, filed a class action complaint alleging various wage and hour violations under the Labor Code and related unfair competition claims under the Business and Professions Code. The complaint sought to represent eight classes of current and former nonexempt employees, without excluding those who had signed arbitration agreements. Sierra Pacific, a lumber manufacturer operating facilities across California, answered the initial complaint without asserting arbitration as an affirmative defense. Although it briefly raised arbitration in its response to the first amended complaint in 2019, it omitted the defense from its answer to the operative second amended complaint filed in 2021. Discovery proved contentious. In December 2018, McDonald requested production of documents, including arbitration agreements applicable to nonexempt employees. Sierra Pacific objected on grounds of overbreadth and third-party privacy. The trial court granted McDonald's motion to compel in February 2020, ordering production of the agreements without confidentiality restrictions absent a protective order. Sierra Pacific's supplemental response provided only an unsigned form agreement and stated that approximately 2,000 nonexempt employees had signed it, without producing signed copies or identifying signatories. Despite multiple instances of monetary sanctions for other discovery violations in 2022, Sierra Pacific did not produce signed agreements until after class certification. Plaintiffs,including Gary W. Dunehew and Robert L. Sherrill, moved for class certification in October 2021, proposing classes that included signatory employees. Sierra Pacific opposed, noting the existence of arbitration agreements but producing only one unsigned form. The trial court certified eight classes in November 2022. Shortly thereafter, in response to a new production request, Sierra Pacific disclosed over 3,400 signed agreements between January and March 2023. It immediately moved to compel arbitration against absent class members who had signed the agreements, arguing the Federal Arbitration Act governed and that the motion was timely under Sky Sports, Inc. v. Superior Court (2011) 201 Cal.App.4th 1363, as it could not enforce arbitration against unnamed class members pre-certification. Plaintiffs opposed on waiver grounds and separately moved for sanctions based on Sierra Pacific's failure to comply with the February 2020 order. They highlighted Sierra Pacific's extensive participation in classwide discovery involving signatories (e.g., producing records for 642 signatories in a sample of 1,388 putative members without differentiation), reliance on signatory declarations to oppose certification, and involvement in two mediations aimed at classwide settlements. The trial court denied the motion to compel in August 2023, applying the multifactor test from St. Agnes Medical Center v. PacifiCare of California (2003) 31 Cal.4th 1187 and finding Sierra Pacific's conduct inconsistent with an intent to arbitrate. It also granted sanctions, precluding Sierra Pacific from introducing evidence of the agreements or arguing that class members signed them. On appeal, the appellate court reviewed the waiver finding de novo under the updated standard from Quach v. California Commerce Club, Inc. (2024) 16 Cal.5th 562, which requires clear and convincing evidence that the party knew of its arbitration right and intentionally relinquished it through inconsistent conduct, without requiring prejudice. The Court of Appeal affirmed the trial court's denial of defendant Sierra Pacific Industries' motion to compel arbitration and dismissed the appeal from the trial court's order imposing evidentiary and issue sanctions.In the published case of Sierra Pacific Industries Wage and Hour Cases -C099436 (December 2025). The court concluded Sierra Pacific waived its rights, emphasizing its years-long litigation without asserting arbitration, defiance of the discovery order, undifferentiated class discovery, mediation participation, and deletion of the arbitration defense. It distinguished cases like Sky Sports, Iskanian v. CLS Transportation Los Angeles, LLC (2014) 59 Cal.4th 348, and Piplack v. In-N-Out Burgers (2023) 88 Cal.App.5th 1281, where delays were justified by intervening legal changes, and drew support from Hill v. Xerox Business Services, LLC (9th Cir. 2023) 59 F.4th 457, holding that pre-certification conduct can establish waiver. Regarding sanctions, the court dismissed the appeal for lack of jurisdiction, as no statute authorizes direct appeal from evidentiary or issue sanctions orders (Code Civ. Proc., § 904.1). It rejected Sierra Pacific's argument that the order was effectively an arbitration denial appealable under section 1294 or ancillary under section 1294.2, noting the motions' distinct purposes and logical separateness ...

The CEO of a Fresno-based home health care company was arrested at San Francisco International Airport while attempting to board a flight to Nigeria. He is charged in a criminal complaint alleging that he fraudulently obtained more than $7 million in payments from the Department of Veterans Affairs for services that were never actually rendered, including care purportedly rendered to veterans weeks after they had died, U.S. Attorney Eric Grant announced. According to court documents, between December 2019 and July 2024, Cashmir Chinedu Luke, believed to be 66, of Antioch, operated Four Corners Health LLC. That entity provided unskilled in-home nursing and day-to-day care for elderly VA beneficiaries under the Veterans Community Care Program. Four Corners provided services in Fresno, Tulare, Merced, Mariposa, Madera, San Francisco, and Contra Costa Counties. Luke engaged in a five-year scheme to bill the VA for hours of care that were not actually rendered to veterans. Luke caused Four Corners to submit approximately 10,000 individual false claims of care provided that caused the VA, through its third-party benefits administrator, to reimburse Four Corners $7 million for duplicate claims for care actually provided, claims for days caretakers were not present with veterans, claims for hours of care beyond those actually worked by caretakers, and claims of care for veterans who were actually dead. Luke served as the sole owner and billing representative for Four Corners and actively deceived the VA’s third-party benefits administrator as it attempted to recover some of the fraudulently paid reimbursements. This allowed the Four Corners billing scheme to continue. Luke personally profited from the scheme as the sole owner of the bank account that received the reimbursement payments. Luke spent reimbursement payments immediately after being paid by the VA, either by spending lavishly on personal expenses or by promptly transferring the funds across a network of bank accounts throughout Asia and Africa. This is not Luke's first encounter with federal law. In 2009, he was convicted in the U.S. District Court for the District of Maryland of conspiracy to commit identification document fraud and aggravated identity theft. His appeal in United States v. Luke, 628 F.3d 114 (4th Cir. 2010), was filed following his October 23, 2009, conviction in the U.S. District Court for the District of Maryland on all four counts of the indictment. Luke challenged the sufficiency of the evidence supporting his convictions, arguing that his actions did not fall within the scope of the relevant federal statutes. The Fourth Circuit, in a published opinion authored by Judge Allyson K. Duncan, rejected these arguments in a unanimous decision and affirmed the district court's judgment. The opinion emphasized that the statutes' broad language clearly encompassed Luke's fraudulent conduct, and the evidence at trial was more than sufficient to support the jury's verdict. He served a 27-month prison sentence, followed by three years of supervised release. Court records from that case indicate Luke, a naturalized U.S. citizen originally from Nigeria, used two identities - his legal name (Cashmir Luke) and birth name (Chinedu Cashmire Osuagwu) - and was found to have committed perjury during his testimony. The 2008 detention order noted his "ties to Nigeria," which may explain the timing of his attempted departure. Luke immigrated to the United States from Nigeria in 1982 and became a naturalized citizen in 1984. He initially obtained a U.S. passport and a Virginia driver's license under his birth name, Chinedu Cashmire Osuagwu. In 1996, he legally changed his name to Cashmir Chinedu Luke but continued to actively maintain both identities for separate purposes, such as professional and personal dealings. At the time of the 2009 offenses, Luke resided in Randallstown, Maryland, and worked as a respiratory therapist at a rehabilitation hospital in Baltimore. This 2025 case is the product of an investigation by the U.S. Veterans Affairs Office of Inspector General. Assistant U.S. Attorney Calvin Lee is prosecuting the case. If convicted, Luke faces a maximum statutory penalty of 10 years in prison and a $250,000 fine. Any sentence, however, would be determined at the discretion of the court after consideration of any applicable statutory factors and the federal Sentencing Guidelines, which take into account a number of variables. The charges are only allegations; the defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt ...

A former physician from Santa Monica was sentenced today to 30 months in federal prison for repeatedly selling vials of ketamine to actor and author Matthew Perry despite knowing Perry’s well-documented history of drug addiction and that Perry’s personal assistant was administering the drug without medical training or supervision. Salvador Plasencia, 44, a.k.a. “Dr. P,” was sentenced by United States District Judge Sherilyn Peace Garnett, who also fined him $5,600 and ordered him immediately remanded to federal custody. Plasencia pleaded guilty on July 23 to four counts of distribution of ketamine. He surrendered his California medical license in September 2025. Plasencia was a physician who owned and operated a Calabasas-based urgent-care clinic called Malibu Canyon Urgent Care LLC. As a medical doctor, Plasencia knew that ketamine was a controlled substance and an anesthetic that is used to treat – without the approval of the United States Food and Drug Administration – depression and other psychiatric conditions. At all relevant times, Plasencia knew about potential risks associated with ketamine, including sedation, psychiatric events, abuse and misuse by patients, among others. As his treatment notes reflected, Plasencia also believed that patients “should be monitored by [a] physician when undergoing treatment as a safety Measure,” according to court documents. On September 30, 2023, Plasencia was introduced to Perry by one of his own patients who stated that Perry was a “high profile person” who was seeking ketamine and was willing to pay “cash and lots of thousands” for ketamine treatment, according to Plasencia’s plea agreement. “Rather than do what was best for Mr. Perry – someone who had struggled with addiction for most of his life – [Plasencia] sought to exploit Perry’s medical vulnerability for profit,” prosecutors argued in a sentencing memorandum. “Indeed, the day [Plasencia] met Perry he made his profit motive known, telling a co-conspirator: ‘I wonder how much this moron will pay’ and ‘let’s find out.’” The same day Plasencia met Perry, he contacted Mark Chavez, 55, then a licensed San Diego physician. Plasencia that day drove to Costa Mesa and purchased from Chavez $795 in ketamine vials and tablets, syringes, and gloves. Plasencia then drove to Perry’s home in Los Angeles, injected Perry with ketamine, and left at least one vial of ketamine to Kenneth Iwamasa, 60, of Toluca Lake, Perry’s personal assistant. Iwamasa paid Plasencia $4,500. During the following weeks, Plasencia again purchased ketamine from Chavez and administered the drug to Perry multiple times at Perry’s home and once in a Long Beach parking lot while in the backseat of Perry’s vehicle. During one ketamine treatment at Perry’s home, Perry’s blood pressure spiked causing him to freeze up. Notwithstanding Perry’s reaction, Plasencia left additional vials of ketamine with Iwamasa, knowing that Iwamasa would inject the ketamine into the victim. From September 30, 2023, to October 12, 2023, Plasencia distributed 20 vials and multiple tablets of ketamine and syringes to Iwamasa and Perry, knowing that his conduct fell below the proper standard of medical care and that the ketamine transfers were not for a legitimate medical purpose. As prosecutors argued in their sentencing memorandum, Plasencia charged a total of $57,000 for these efforts, even though the going price of ketamine was only approximately $15 per vial. Plasencia later placed an order for 10 vials of ketamine through a licensed pharmaceutical company using his Drug Enforcement Administration (DEA) license. After receiving the ketamine, on October 27, 2023, he sent the following text message to Iwamasa: “I know you mentioned taking a break. I have been stocking up on the meanwhile. I am not sure when you guys plan to resume but in case its when im out of town this weekend I have left supplies with a nurse of mine ...I can always let her know the plan.” Perry fatally overdosed on ketamine the following day. Plasencia did not provide the ketamine that caused his death. After Perry’s overdose and in response to a subpoena issued by the DEA to Plasencia, Plasencia falsified purported treatment notes and an invoice for Perry, which prosecutors argued were designed to cover up that he had been illegally selling vials of ketamine to Iwamasa. Among other things, Plasencia provided fraudulent notes that claimed on October 7, 2023, Perry was “scheduled to meet for a treatment session but was not present,” when, in fact, as Plasencia knew, the only person he was schedule to meet on that day was Iwamasa, at midnight, at a public street corner outside of a bar in Santa Monica, to sell Iwamasa vials of ketamine, to be administered to Perry without any health care professional present. Chavez and Iwamasa pleaded guilty last year to federal drug charges and are scheduled to be sentenced on December 17, 2025, and January 14, 2026, respectively. Two other defendants charged in connection with Perry’s death – Erik Fleming, 56, of Hawthorne, and Jasveen Sangha, 42, a.k.a. “Ketamine Queen,” of North Hollywood, also pleaded guilty to federal drug charges and await sentencing on January 7, 2026, and February 25, 2026, respectively. The Los Angeles Police Department, the DEA, and the United States Postal Inspection Service investigated this matter.Assistant United States Attorneys Ian V. Yanniello of the National Security Division and Haoxiaohan H. Cai of the Major Frauds Section prosecuted this case ...

Proposition 103, passed by California voters in 1988, is a landmark insurance reform measure that rolled back auto and homeowners insurance rates by about 20%, established prior approval requirements for rate increases (giving the elected Insurance Commissioner oversight), and created other consumer protections to prevent excessive pricing and ensure fair practices. Authored by Harvey Rosenfield of Consumer Watchdog, it has saved Californians billions in premiums over the decades but has come under fire amid the state's ongoing insurance crisis, driven by wildfires, climate change, and rising claims costs. Critics, including some insurers and brokers, argue it stifles market competition and deters companies from offering policies in high-risk areas, leading to insurer pullbacks and coverage gaps. The conflict escalated in 2025, prompting competing ballot measures for the November 2026 election. One of them was the California Insurance Market Reform and Consumer Protection Act of 2026. It was filed in August 2025 by Elizabeth Hammack, a Roseville-based insurance broker and owner of Panorama Insurance Associates. This initiative sought to overhaul Prop 103 by repealing its core rate-regulation provisions, allowing faster rate approvals, reducing regulatory burdens, and aiming to attract more insurers back to the market. Supporters framed it as essential for stabilizing California's "free-falling" insurance sector, citing recent catastrophic fires like those in Altadena and Pacific Palisades. This prompted a response. The Insurance Policyholder Bill of Rights. It was filed on September 22, 2025, by Consumer Watchdog leaders Carmen Balber (executive director), Jamie Court, and Harvey Rosenfield. This measure responded directly to Hammack's filing and proposed strengthening consumer protections. Key provisions included: Guaranteeing homeowners insurance for those meeting state wildfire mitigation standards (or facing a five-year sales ban for non-compliant insurers). Consumer Watchdog positioned it as a defense of Prop 103's legacy while addressing modern challenges like the exodus of five major homeowners insurers from parts of California. On December 2, 2025 leaders from both sides announced a mutual "armistice," withdrawing their initiatives from the 2026 ballot. This deal preserves Prop 103's existing reforms intact for now, avoiding a high-stakes voter showdown that could have divided the insurance debate further. In a joint statement from Consumer Watchdog, Balber, Court, and Rosenfield explained: “This armistice preserves the landmark protections and consumer savings under insurance reform Proposition 103, which was the principal reason we filed the Policyholder Bill of Rights this year. We said if the broker withdrew, we would withdraw. There is still a huge need for many of the other protections in the ballot measure, including the right to be guaranteed an insurance policy if homeowners meet state wildfire mitigation standards and the right to better claims handling policies." "We do not have the financial resources to pursue this fight at this time. However, we will spend the next year building support in order to pressure the insurance industry to sell policies in higher risk areas and to treat their customers better. Polling shows 85% of voters want insurance companies to have a mandate to sell homeowners insurance to people who fire-proof their homes. It’s up to the legislature to enact such changes. If they do not, we will work to have the resources to take this popular fight directly to the voters in 2028.” California's insurance market remains strained: Recent laws like SB 1107 (effective January 2026) offer temporary relief by speeding up rate approvals for "good faith" filers, but critics call it a "Band-Aid." The competing ballot withdrawals avert a costly signature-gathering and campaign fight (ballot measures require ~546,000 valid signatures), but they don't resolve underlying tensions - insurers continue to limit policies in fire-prone areas, leaving many homeowners uninsured or underinsured. Public sentiment leans pro-consumer, per the polling cited, which could fuel legislative momentum. This development highlights the ongoing tug-of-war between deregulation (to lure insurers) and consumer safeguards in a wildfire-ravaged state ...

California's Unfair Competition Law (UCL), codified in Business and Professions Code Section 17200, prohibits any unlawful, unfair, or fraudulent business act or practice. This broad statute has been applied to challenge "no-poach" provisions - also known as no-hire or non-solicitation agreements between competing companies - where employers agree not to recruit, solicit, or hire each other's employees, either explicitly or through informal arrangements. Such agreements are viewed as anticompetitive because they restrict employee mobility, suppress wages by limiting competition for talent, and hinder workers' ability to negotiate better compensation or job terms. No-poach provisions also may violate California antitrust laws under the Cartwright Act (Business and Professions Code §§ 16720 et seq.), which bars agreements that restrain trade, including those that suppress compensation or limit hiring among competitors. They can also constitute violations of the Unfair Competition Law (UCL - Section 17200) when deemed unlawful or unfair business practices. PSSI is a national cleaning and sanitation company that contracts with dozens of meatpacking and food processing facilities in California and hundreds across the country. Nationally, PSSI employs over 17,000 workers across approximately 500 worksites. PSSI has had cleaning contracts with over 20 meatpacking and food processing companies in California, including well-known names such as Foster Farms, Harris Ranch, and Pilgrim’s Pride. DOJ’s investigation revealed that PSSI had implemented a no-poach provision in 22 out of its 24 operative contracts in California, which impacted the rights of approximately 6,000 employees who worked pursuant to those contracts. Today’s judgment, once approved by the court, resolves the allegations stated above. According to the Attorney General, this business practice, often hidden from employees, can have serious implications including artificially lowering employee compensation, reducing incentives for companies to improve working conditions, and limiting employee career growth. Last April, the Attorney General filed a lawsuit against PSSI in the Superior Court of the State of California, County of San Diego, Case No. 25CU022640C, entitled The People of the State of California v. Packers Sanitation Services, Inc., LTD., dba Fortrex; Packers Sanitation Services, LTD., LLC, a California corporation; and Does 1 through 20, alleging a cause of action for violations of Business and Professions Code Section 17200 Unfair Competition Law related to the No Hire Provision allegedly contained within Services Agreements So-called no-poach provisions are contractual agreements between employers to not hire each other’s employees. The People further allege that PSSI’s No Hire Provision had the effect of restraining employee mobility in violation of Business and Professions Code section 16600. PSSI removed the No Hire Provision from all of its California Services Agreements by February 2024. This week the California Attorney General announced a settlement against Packers Sanitation Services, Inc. LTD., now doing business as Fortrex (PSSI), a national cleaning and sanitation company, resolving allegations that the company used unlawful “no poach” agreements that restrict competition. As part of the settlement, PSSI will provide notice to employees and customers regarding its discontinued use of the unlawful provision, in addition to paying $500,000 in civil penalties. According to the Settlement Agreement the Defendants continue to deny all allegations of wrongdoing and liability in connection with this litigation. There have been several other no-poaching cases filed in California dating back to at least 2011. 2011 - In re High-Tech Employee Antitrust Litigation, Settled in 2015 for $415 million. 2014 - In re Animation Workers Antitrust Litigation, Settled in 2017 for $100 million. 2016 - Frost v. LG Electronics Inc., Dismissed in 2018 for failure to plausibly allege U.S. impact. 2017 - Markson v. CRST International Inc, Ongoing 2018 - Multistate Fast-Food No-Poach Settlements (e.g., Arby's, Dunkin', Five Guys, Little Caesars), no monetary penalties but injunctive relief. 2019 - Multistate Fast-Food No-Poach Settlements (e.g., Burger King, Popeyes, Tim Hortons), 2020 settlements prohibited future use nationwide ...