Corinne Leshen sustained an industrial injury on June 16, 2009, while employed by the State of California Highway Patrol, resulting in hypertension, arteriosclerosis, and hypertensive cardiovascular disease. Southland Spine & Rehabilitation Medical Center provided medical treatment services and filed a lien for reimbursement on January 7, 2011, under Labor Code § 4903(b). Because the lien predated January 1, 2013, Southland paid a $100 activation fee under § 4903.06 on December 16, 2015. It later filed a declaration under § 4903.8(d) on October 16, 2018. The underlying case settled on April 9, 2019, via stipulations with request for award at 50% permanent disability.

Critically, Southland never filed the supplemental lien declaration required by Labor Code § 4903.05(c)(2), which set a deadline of July 1, 2017 (extended to July 3, 2017, because July 1 fell on a weekend) for all medical treatment liens filed before January 1, 2017.

The matter came on for lien trial on October 28, 2025, with jurisdiction and the declaration requirement as the issues in dispute. On December 18, 2025, the WCJ issued findings that Southland had failed to timely file the required declaration by July 3, 2017, resulting in dismissal of the lien by operation of law under § 4903.05(c)(3). The WCJ reasoned that § 4903.05(c)(2) unambiguously applied to all liens filed before January 1, 2017, for medical treatment expenses under § 4903(b), regardless of whether those liens were subject to a filing fee or an activation fee.

The WCAB panel denied Southland’s petition for reconsideration and affirmed the WCJ’s dismissal of the lien in the panel decision of Leshen v. State of California Highway Patrol, ADJ6925586 (March, 2026)

Southland argued that because its 2011 lien was subject to the activation fee under § 4903.06 rather than the filing fee under § 4903.05, the declaration requirement of § 4903.05(c) did not reach its lien. The Board rejected this reading.

Drawing on the panel decision in Montelongo v. Gelson’s Market (February 11, 2022, ADJ2193346) [2022 Cal. Wrk. Comp. P.D. LEXIS 41], the Board traced the legislative history of SB 1160 (2016), which added the declaration requirement to § 4903.05(c). The Legislature expressly described the declaration as an “anti-fraud” measure intended to apply to “all lien claimants,” requiring each to identify the specific statutory basis authorizing its lien. SB 1160’s floor analyses made clear that the requirement extended to pre-existing liens, with a compliance deadline of July 1, 2017.

The Board further noted that the filing fee under § 4903.05 and the activation fee under § 4903.06 serve the same fundamental purpose — deterring frivolous liens — citing Angelotti Chiropractic v. Baker (9th Cir. 2015) 791 F.3d 1075 [80 Cal. Comp. Cases 672]. Drawing a distinction between the two fee types to exempt older liens from the declaration requirement would undermine the Legislature’s anti-fraud intent.

The Board also acknowledged Southland’s argument that DWC Newslines had led it to believe its pre-2013 lien was exempt from the declaration requirement. However, relying on Hernandez v. Henkel Loctite Corp. (2018) 83 Cal. Comp. Cases 698, 702 [2018 Cal. Wrk. Comp. LEXIS 23] (Appeals Board en banc), the Board reiterated that DWC Newslines provide only informal guidance and do not carry regulatory authority, which rests with the Appeals Board under Labor Code §§ 5307 and 111.

Because no declaration was filed by the July 3, 2017 deadline, the lien was dismissed with prejudice by operation of law, and the Board concluded it retained no jurisdiction over the claim. The petition for reconsideration was denied.

Other panel decisions reaching the same conclusion include Carrillo v. Troon Golf Management (January 13, 2025, ADJ4642758) and Cornejo v. Sears Holding Corp. (March 11, 2025, ADJ7580462) [2025 Cal. Wrk. Comp. P.D. LEXIS 65].

Former Judge Israel Claustro served on the Orange County Superior Court from 2022 until his resignation on January 12, 2026. His departure from the bench was precipitated by federal criminal charges.

On January 7, 2026, the U.S. Department of Justice filed charges against Claustro in U.S. v. Israel Claustro, No. 8:26-cr-00001-FWS (C.D. Cal.), for his role — before he became a judge — in a scheme to defraud the California Subsequent Injuries Benefits Trust Fund. The fraud did not involve his practice of law.

Five days later, on January 12, 2026, Claustro pleaded guilty to one felony count of mail fraud and agreed to immediately resign from the bench. He had not yet been sentenced as of the date of the stipulation.

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 Commission also found that Claustro had executed his guilty plea agreement on December 8, 2025, yet failed to promptly report the criminal charges to the Commission on Judicial Performance as required by Canon 3D(3) of the Code of Judicial Ethics.

Claustro and his counsel, Paul S. Meyer, entered into a Stipulation for Discipline by Consent with Commission Director-Chief Counsel Gregory Dresser under Commission Rule 116.5. Under the stipulation, Claustro admitted that the facts were true, accepted the legal conclusions, and waived any right to further proceedings — including formal proceedings before the Commission and review by the California Supreme Court.

The Commission imposed a public censure and bar. Under Article VI, Section 18, subdivision (d) of the California Constitution, the Commission has authority to censure a judge for conduct prejudicial to the administration of justice that brings the judicial office into disrepute.

The Commission concluded that Claustro’s prebench felony fraud — a crime of moral turpitude — met that standard. Consistent with precedent, commission of a felony alone is a sufficient basis for censure and bar, regardless of the underlying facts of the crime. *See Censure and Bar of Former Judge Ronald C. Kline* (2006) p. 3; Cal. Const., art. VI, § 18, subd. (d); *Broadman v. Commission on Judicial Performance* (1998) 18 Cal.4th 1079, 1111–1112.

IHSS (In-Home Supportive Services) is a California program providing in-home care to eligible aged, blind, or disabled individuals, primarily funded by the state with federal matching. Fraud typically involves providers claiming hours not worked, recipients overstating needs, collusion between providers and recipients, identity theft, or billing for unprovided services. Common charges include grand theft, false claims, and welfare fraud under California Penal Code sections.

The California Department of Social Services (CDSS) tracks program integrity through annual reports. Fraud complaints and investigations occur, but criminal prosecutions and convictions represent a small fraction of cases, as many are resolved administratively (e.g., overpayment recovery, service reductions, or terminations). Provider fraud accounts for the vast majority (~80-83%) of investigated cases.

Recent news (as of 2026) shows ongoing but limited high-profile IHSS-specific convictions reported publicly; one 2026 LA County DA case involved an IHSS caregiver convicted after surveillance showed physical capabilities contradicting claimed needs.

The Special Investigative Unit of RJN Investigations, Inc. was recently notified by the Los Angeles County District Attorney’s Office of their successful prosecution in the case of People of The State of California v M. Lopez based upon a documented fraud referral.

In this case, the claimant was employed as a caretaker of the California Department of Social Services – I.H.S.S. At the time of the claimant’s deposition, he appeared wearing a back support and ambulating with the aid of a cane.

Proactively, the Senior Claims Examiner authorized the RJN SIU Department to perform RUSH surveillance. During the ongoing surveillance, extensive video evidence was obtained depicting the claimant ambulating freely without any noticeable signs of artificial support or noticeable restrictions. The video evidence was subsequently provided to the QME for review and comment. In his QME report, it stated in part the following:

“Overall, review of the subrosa video footage demonstrates a degree of inconsistency between what Mr. Lopez reported and exhibited at the time of the PQME examination, and what he was visualized performing during the video segments…My reporting on this case has changed as a result of this additional information and my revised reporting follows below…”

In compliance with the regulations set forth by the California Department of Insurance Fraud Division, the RJN SIU formally filed this case with their office as well as with the Los Angeles County District Attorney’s Office.

Felony charges were then issued against the claimant, and a preliminary criminal hearing was set. The claimant failed to appear for the hearing and as a result, a felony bench warrant was issued for his arrest.

The claimant subsequently had formal interactions with law enforcement and their check of NCIC revealed his felony warrant where he was promptly arrested. After several criminal hearings, the claimant entered into a plea bargain agreement entailing formal probation and having to pay restitution in the amount of $ 43,263.00.

Kara Sandler worked for Modernizing Medicine, Inc. (ModMed), a Delaware corporation. Her employment contract required that any employment-related disputes be resolved through binding arbitration under the Federal Arbitration Act, following the procedures of the California Arbitration Act. The contract further specified that arbitration would be administered by JAMS (Judicial Arbitration & Mediation Services, Inc.), whose rules provide that an arbitrator — not a court — must decide threshold questions about the validity and enforceability of the arbitration agreement itself. The contract also contained a generic severability clause stating that if “a court or other body of competent jurisdiction” found any provision invalid, the offending provision would be enforced to the maximum extent permissible and the remainder of the agreement would survive.

Sandler filed suit against ModMed in the Southern District of California, asserting state and federal claims of age and disability discrimination. ModMed moved to compel arbitration. Sandler opposed the motion, arguing the arbitration agreement was unconscionable.

The district court denied ModMed’s motion. While it acknowledged that the incorporation of JAMS rules constituted a delegation of validity questions to the arbitrator, the court relied on several California state-court decisions to conclude that the severability clause undermined that delegation. The court’s reasoning was that because the severability clause referenced “a court,” the parties may not have clearly intended for an arbitrator to be the one deciding whether the arbitration agreement was enforceable. Having claimed authority to decide the question itself, the district court then ruled the arbitration agreement unconscionable and refused to sever the offending provisions.

The Ninth Circuit reversed. The panel in the published case of Sandler v. Modernizing Medicine, Inc. No. 24-6623 (March 2026) and took issue with the district court’s reliance on California state-court opinions, and held that the district court misapplied federal law and should never have reached the unconscionability question at all.

The court began with settled precedent: when parties incorporate JAMS (or AAA) rules into an arbitration agreement, that incorporation constitutes “clear and unmistakable” evidence of an intent to delegate questions of arbitrability to the arbitrator. The panel cited Patrick v. Running Warehouse, LLC, 93 F.4th 468, 481 (9th Cir. 2024), and Brennan v. Opus Bank, 796 F.3d 1125, 1130 (9th Cir. 2015), as controlling authority on that point.

The central question was whether a generic severability clause mentioning “a court” introduced enough ambiguity to negate that otherwise clear delegation. The Ninth Circuit held it did not. The panel reasoned that the two clauses can coexist: the delegation clause sends disputes — including validity disputes — to the arbitrator, while the severability clause merely provides a contingency mechanism if a court were to interpret the contract for any reason. The court emphasized the “cardinal principle of contract construction” from Mastrobuono v. Shearson Lehman Hutton, Inc., 514 U.S. 52, 63 (1995), that contract clauses should be read as consistent with one another rather than in conflict. Letting the severability clause swallow the delegation clause would render the latter superfluous, a result disfavored under Trident Center v. Connecticut General Life Insurance Co., 847 F.2d 564, 566 (9th Cir. 1988).

The panel also took issue with the district court’s reliance on California state-court opinions. Whether parties clearly and unmistakably intended to delegate arbitrability is a question of federal law under the FAA, as established in Brennan, 796 F.3d at 1129, and First Options of Chicago, Inc. v. Kaplan, 514 U.S. 938, 944 (1995). Any state rule that uses a severability clause to negate an otherwise clear delegation would be preempted by the FAA, under the reasoning of Kindred Nursing Centers Limited Partnership v. Clark, 581 U.S. 246, 251 (2017), and AT&T Mobility LLC v. Concepcion, 563 U.S. 333, 339 (2011). The Fifth and Sixth Circuits have reached the same conclusion. See Arnold v. Homeaway, Inc., 890 F.3d 546, 552 (5th Cir. 2018); Blanton v. Domino’s Pizza Franchising LLC, 962 F.3d 842, 846–47 (6th Cir. 2020).

The Ninth Circuit vacated the unconscionability ruling, reversed the denial of the motion to compel, and remanded with instructions to grant the motion and stay the case pending arbitration.