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Is “Text Neck” a Cell Phone CT Epidemic?

Spine surgeons are noticing an increase in patients with neck and upper back pain, likely related to poor posture during prolonged smartphone use, according to a recent report.

Some patients, particularly young patients who shouldn’t yet have back and neck issues, are reporting disk hernias and alignment problems, the study authors write in The Spine Journal.

“In an X-ray, the neck typically curves backward, and what we’re seeing is that the curve is being reversed as people look down at their phones for hours each day,” said study coauthor Dr. Todd Lanman, a spinal neurosurgeon at Cedars-Sinai Medical Center in Los Angeles.

“By the time patients get to me, they’re already in bad pain and have disc issues,” he told Reuters Health. “The real concern is that we don’t know what this means down the road for kids today who use phones all day.”

According to the story in Reuters Health, Lanman and co-author Dr. Jason Cuellar, an orthopedic spine surgeon at Cedars-Sinai, write that people often look down when using their smartphones, particularly when texting as compared to browsing online or watching videos. Previous studies have also found that people hold their necks at around 45 degrees, and it becomes even worse as they sit, versus standing, the study team writes.

The impact on the spine increases at higher flexed postures, they add. While in a neutral position looking forward, the head weighs about 10 to 12 pounds. At a 15-degree flex, it feels like 27 pounds. The stress on the spine increases by degree, and at 60 degrees, it’s 60 pounds.

“For today’s users, will an 8-year-old need surgery at age 28?” Lanman said. “In kids who have spines that are still growing and not developed, we’re not sure what to expect or if this could change normal anatomies,” he told Reuters Health.

Lanman and Cuellar suggest simple lifestyle changes to relieve the stress from the “text neck” posture. They recommend holding cell phones in front of the face, or near eye level, while texting. They also suggest using two hands and two thumbs to create a more symmetrical and comfortable position for the spine.

Beyond smartphone use, the spinal surgeons recommend that people who work at computers or on tablets use an elevated monitor stand so it sits at a natural horizontal eye level. With laptops, they recommend a similar adaptation by using a separate keyboard and mouse so the laptop can be at eye level and still create a good ergonomic position while typing.

“It is difficult to recommend a proper posture for smartphone users. If we raise the phone at eye level to avoid the look-down posture, it will add new concerns for the shoulder due to the elevated arm posture,” said Gwanseob Shin of the Ulsan National Institute of Science and Technology Ergonomics Lab in South Korea, who wasn’t involved with the study.

“A more practical recommendation would be frequent rest breaks or some physical exercise that can strengthen the neck and shoulder muscles,” Shin told Reuters Health by email. “Some apps can give alarming signals to users to avoid prolonged looking-down posture.”

Lanman recommends stretches and basic exercises that focus on posture as well. He tells patients to lie on their beds and hang their heads over the edge, extending the neck backward to restore the normal arc in the neck. While sitting, he recommends aligning the neck and spine by checking that the ears are over the shoulders and the shoulders are over the hips.

“Ask your friend to take a photo of your upper body when you’re texting, then use the picture as the background image on your phone,” Shin said. “That will remind you to take breaks frequently. Even a short break of a few seconds – called a micro-break – can help our tissues recover.”

Orthopedists Review 30 Years of Advances

The editorial board of Orthopedics Today was asked what they think are the top advances in orthopedic surgery over the past 30 years.

It is now estimated that up to 80% of orthopedic procedures are amenable to the outpatient setting and many orthopedic practices have sophisticated imaging capabilities in their office and surgery centers.

The shortened recovery and associated disability with less invasive and more stable and rigid fixation have allowed patients to be more functional sooner, and reduced the morbidity of some of the previous approaches.

More recently, steady improvement in arthroscopic techniques and instrumentation and expanded use in the hip joint has furthered this subspecialty area of orthopedics.

Improvements and innovations in materials, articulation surfaces, peri- and postoperative management strategies and outcomes research have worked together during the last 30 years to decrease implant wear and increase function following joint replacement procedures.

Hip arthroplasty has benefited from the advent of porous metals, improvements in alternative bearing surface technologies, polyethylene advances and newer procedures, such as resurfacing surgery.

Some of the developments that have enhanced knee arthroplasty over the past 30 years include unicompartmental implants, modular components, fixed and mobile bearing designs, newer polyethylenes and computer assistance.

Characteristics of current knee designs that he thought to be associated with long-term in vivo durability as:

– articular surface congruency of either cruciate retaining or posterior stabilized implants;
– minimal motion between the polyethylene and tibial base plate or elimination of motion, as in monoblock implants;
– non-aged, compression molded polyethylene with moderate crosslinking, sterilized in an inert environment;
– CoCr tibial and CoCr or ceramic coated (Oxinium) femoral components;
– mobile bearing implants; and
– congruous, capacious patellar-femoral designs.

In order to be associated with long-term in vivo durability, these designs must be inserted with instrumentation that assures consistent alignment, soft tissue balance in flexion and extension and appropriate stability,

Imaging and its use in improving outcomes in orthopedic surgery have developed concurrently throughout the past 30 years, with smaller and more convenient methods giving physicians a wider range of possibilities. Even MRI and CT have seen recent changes in their implementation, with surgeons moving toward utilizing them for patient-specific implants or guides.

National Academy Reports on Fake Medical Research

Medical care in California Workers’ Compensation is now limited by treatment guidelines developed from the science of evidence based medicine.  The concept is only as good as the quality of the science that appears in medical literature.

Several decades ago, a series of highly visible cases of alleged research misconduct prompted researchers, research institutions, research sponsors, and others to consider how they might promote research integrity and address breaches in integrity more effectively.

This month a new 285 page report, titled “Fostering Integrity in Research,” to be published by the National Academies Press called on all stakeholders – including researchers, institutions, funders, publishers, scientific societies and federal agencies – to improve their policies and practices to respond to continuing and increasing threats to research integrity.

The authors claim that in recent years “it is clear that the research enterprise faces new and complex challenges in fostering integrity and in dealing with the consequences of research misconduct and detrimental research practices. Serious cases of research misconduct – including some that have gone undetected for years – continue to emerge with disturbing regularity in the United States and around the world. Increases in the number and percentage of research articles that are retracted and growing concern about low rates of reproducibility in some research fields raise questions about how the research enterprise can better ensure that investments in research produce reliable knowledge.”

The authors outlined the need for actions that help clarify authorship standards, ensure availability of data necessary to reproduce research, protect whistleblowers, and ensure that both positive and negative research results are reported.

The report also called for the creation of a nonprofit, independent advisory board designed to support efforts to strengthen research integrity, as well as reduce and address research misconduct.

“The research process goes beyond the actions of individual researchers,” committee chair Robert M. Nerem, PhD, MSc, BS, professor emeritus at the Institute for Bioengineering and Bioscience at Georgia Institute of Technology, said in a press release. “Research institutions, journals, scientific societies and other parts of the research enterprise all can act in ways that either support or undermine integrity in research.”

An earlier report released by the National Academies of Sciences, Engineering, and Medicine in 1992 described and analyzed a variety of issues related to research integrity.

The definition of scientific misconduct established in that document – “fabrication, falsification or plagiarism in proposing, performing or reporting research” – remains valid, according to authors of the new report. However, the updated version suggests research practices that had previously been characterized as questionable – such as failure to retain research data, or misleading use of statistics – should now be considered “detrimental.”

“The research process goes beyond the actions of individual researchers,” Nerem said. “Research institutions, journals, scientific societies and other parts of the research enterprise all can act in ways that either support or undermine integrity in research.”

The National Academy of Sciences was established in 1863 by an Act of Congress, signed by President Lincoln, as a private, nongovernmental institution to advise the nation on issues related to science and technology. Members are elected by their peers for outstanding contributions to research.

Reseda Clinic Owner to Serve 51 Month Sentence

The office manager and part-owner of a Reseda medical clinic known as M.T.P. Medical Clinic, Inc., has been sentenced to 51 months in federal prison for his role in a healthcare fraud scheme that generated millions of dollars – money that was not reported on his federal income tax returns.

Michael Huynh, 67, of Northridge, was sentenced by United States District Judge Otis D. Wright II. In addition to the prison term, Judge Wright ordered Huynh to pay just over $1.9 million in restitution to the victim insurance companies and back taxes – estimated to be nearly $950,000 to the Internal Revenue Service.

Following a seven-day trial in September 2016, Huynh was found guilty of one count of conspiracy to commit healthcare fraud and 11 counts of filing false tax returns.

The evidence introduced at trial showed that between January 2004 and November 2009 Huynh and a pharmacist participated in a healthcare fraud scheme that billed private insurance plans for prescription medication that was never dispensed to insured patients.

Huyhn provided co-conspirator Farhad N. Dany Sharim with bogus prescriptions purportedly for patients of the medial clinic who were insured by healthcare benefit programs such as Aetna. Sharim, a co-owner of Century Discount Pharmacy located at 18254 Sherman Way in Reseda, then submitted false and fraudulent bills for prescription drugs that had not been dispensed to the patients.

As a result, Sharim’s pharmacy received substantial payments from various health care benefit programs to which it was not entitled, and Sharim paid Huyhn more than $1.1 million from the pharmacy proceeds.

In order to disguise the payments that he received from co-conspirator Sharim in exchange for the falsified prescriptions, Hunyh provided co- conspirator Sharim with false invoices in the name of H. D. H. Advertising for purported advertising services rendered to CDP. Hunyh received approximately eighty-two CDP checks signed by co-conspirator Sharim totaling approximately $1, 172, 907, which were disguised as payments for’ advertising services and made payable to his grandniece.

Farhad N. Dany Sharim, 57, of Sherman Oaks, previously pleaded guilty to conspiracy to commit healthcare fraud and will be sentenced by Judge Wright on May 1.

The Board of Pharmacy filed a disciplinary accusation against Century Discount Pharmacy, and owners Joseph Amin and Farhad Sharim and another pharmacist named Jong Am Kim in 2015.

The accusation said that the Boards investigation and “examination of prescription records for controlled substances raised many red flags including a repeating pattern of prescriptions written by Drs. Chumley and Rothman and Nurse Practitioner Park. Each prescription had nearly identical handwriting with similar spacing. In addition, most medical offices/clinics and patients were listed in either Compton or Los Angeles, CA, yet Respondent Century Discount Pharmacy, the pharmacy issuing the prescriptions, was located in Reseda, CA. More often than not, the patients traveled approximately 73 miles to fill their prescriptions.”

Certain prescribers responded to letters from the Board investigator. NP Park indicated that she did not write any of the prescriptions for the medications that were listed in the letter. Dr. Ahmed indicated that she had not seen the patients listed and did not prescribe any of the medications on the list. Drs. Byrd, Rothman, and Sison also indicated that they did not write any of the prescriptions on the list.

San Rafael Pharmacy Resolves DEA Dispute

United States Attorney Brian J. Stretch and Drug Enforcement Administration (DEA) Special Agent in Charge John J. Martin announced that Golden Gate Pharmacy Holdings and its wholly owned subsidiaries, Golden Gate Pharmacy Services (GGPS) and Ross Valley Compounding Pharmacy (Ross Valley), have agreed to pay $717,250 to settle allegations by the U.S. Department of Justice that the companies failed to keep and maintain adequate records pertaining to controlled substances at their San Rafael, California facility.

Golden Gate Pharmacy Services and its sister pharmacy, Ross Valley Pharmacy have been providing traditional and nontraditional pharmacy services to Bay Area residents and Long Term Care Facilities since 1969. They have a physical location at 1525 Francisco Blvd East Suite #2 in San Rafael.

The settlement agreement, signed by Justice Department officials, was reached to resolve allegations by the government that a September 2014 DEA inspection uncovered multiple violations by GGPS and Ross Valley of the Controlled Substances Act, 21 U.S.C. § 801.

According to the agreement, San Rafael-based companies GGPS and Ross Valley each was, at the relevant time, registered with the DEA as a Retail Pharmacy providing them with authorizations to handle Schedules II, III, IIIN, and IV controlled substances.

GGPS and Ross Valley both acknowledged they had an obligation to “keep and maintain” records related to its receipt, manufacturing and distribution of controlled substances in connection with operations at their San Rafael, California facility.

According to the agreement, following the DEA’s inspection, the government concluded that between September 4, 2012, and September 4, 2014, GGPS and Ross Valley failed to record or maintain adequate inventory records or “records of the receipt, storage or shipment of controlled substances in at least 5,161 instances.”

In addition, according to the agreement, an employee at the San Rafael facility pilfered approximately 8,000 oxycodone tablets.

According to the terms of the agreement, Golden Gate Pharmacy Holdings, GGPS, and Ross Valley Pharmacy will pay the government $717,250 to resolve all civil claims related to the recordkeeping violations identified in the investigation.

Assistant U.S. Attorney Jonathan U. Lee handled this matter with the assistance of Garland He and Jessica Hurtado.

Is There Subrogation Potential in Kimberly-Clark Class Action?

It is likely that California employers have had many workers’ compensation claims filed over the years by health care workers who claim infectious injury. Some of these workers may have been wearing safety equipment sold by Kimberly-Clark Corporation and Halyard Health Inc. Claim department data mining and data analytics may identify these past and present claims.That discovery may lead to subrogation or a setoff petition should the claimants also be plaintiffs in the Los Angeles Class action filed against these companies.

A Los Angeles jury on Friday night hit Kimberly-Clark Corporation and Halyard Health Inc. with a stunning $454 Million fraud verdict due to the sale by the companies of defective medical devices to doctors, hospitals and trauma centers throughout California for years.

The unanimous verdict, rendered by an eight-person Federal Court jury after hearing extensive evidence in the two-week trial, is likely one of the largest verdicts in U.S. history against a medical device maker. Pursuant to an indemnification agreement entered into between the two defendants, Halyard Health is obligated to pay the entirety of the $454 Million awarded by the jury.

The class action lawsuit, Bahamas Surgery Center, LLC v. Kimberly-Clark Corp et al, Case No. CV 14-8390-DMG, was filed in Los Angeles in United States District Court in October 2014, alleging that the defendants had committed fraud in the marketing and sale of certain of their medical gowns used in critical surgeries.

In particular, the suit claimed that the companies had falsely represented to the FDA, health care workers and the general public that the company’s “Microcool Breathable High Performance Surgical Gowns” (the “Surgical Gowns”) were impermeable and provided protection against serious diseases, including Ebola and HIV, despite the fact that the companies had known since 2012 that the gowns were defective, failed industry tests, and did not meet relevant standards, thus placing healthcare professionals and patients at considerable risk for infection, serious bodily harm and death.

The jury sided with the Plaintiffs Friday and found that the companies had concealed material information from healthcare professionals throughout California and had carried out their scheme with malice, oppression and/or fraud. “This fraud verdict should send a clear message to corporations throughout the United States that concealment and cover-up are not part of doing business,” said lead attorney Michael Avenatti of Eagan Avenatti, LLP, on behalf of the Plaintiffs.

The evidence presented at trial showed that Kimberly-Clark and Halyard knowingly misled the medical community, regulators and the general public about the safety of the Surgical Gowns and even after learning of multiple test failures, failed to alert the FDA, healthcare professionals and patients. Internal e-mails and documents from the companies showed employees describing the manufacturing process as “crap” and admitting that they were knowingly using defective and substandard equipment to make the gowns in Honduras.

Instead of recalling the gowns and disclosing the truth, the companies concealed what they knew, fired employees who knew too much and continued promoting, marketing and selling the gowns by stating they were impermeable, even going so far as to recommend that the gowns be used when treating patients with serious infectious diseases, including Ebola and HIV.

The Plaintiffs were represented at trial by Michael Avenatti, Ahmed Ibrahim and Filippo Marchino of California-based Eagan Avenatti, LLP, together with William C. Hearon of William C. Hearon, PA, based in Miami, Florida.

DWC Spikes the Ball After WCIRB Announcement

Last week The WCIRB proposed a July 1, 2017 average advisory pure premium rate of $2.02 per $100 of payroll which is 16.5% lower than the corresponding industry average filed pure premium rate of $2.42 as of January 1, 2017 and 7.8% less than the Insurance Commissioner’s approved average January 1, 2017 advisory pure premium rate of $2.19.

The recent rate decline is therefore favorable to employers:

And following this announcement, Department of Industrial Relations Director Christine Baker made the following statement on the Workers’ Compensation Insurance Ratings Bureau’s recommendation for a mid-year 7.8 percent rate reduction:

“The 2012 reforms in SB 863 sought to increase benefits and improve care to injured workers while controlling rising costs for employers. Not only did benefits for injured workers increase by 30 percent, but an anticipated rate spike was prevented. Employers have had four consecutive rate reductions, and today’s recommendation will continue that trend”.

“Since 2012, DIR has made significant strides in its quest to eliminate medical provider fraud and illegitimate liens, and is continuing its efforts to launch a prescription drug formulary. These reform efforts seek to further improve treatment of injured workers while reducing costs in the system that would have been paid by employers. As evidenced by the WCIRB’s recommendation for a mid-year rate reduction, our recent reforms have brought both stability and sustainability to California’s workers’ compensation system.”

However, staying within the sports metaphor, the industry must also keep in mind the slogan “yesterday’s hits do not win today’s ball game.”

The Pennsylvania state Insurance Department approved a reduction in the annual workers’ compensation insurance premium rate, which the governor said will save employers $150 million. Benefits for injured workers will not be affected.

The Montana State Fund board of directors has reduced workers’ compensation rates by 5 percent, state officials said Wednesday, adding it was the 11th year in row that rates have remained the same or decreased.

The Ohio Bureau of Workers’ Compensation (BWC) has proposed a $1 billion rebate for Ohio’s private and public employers, the third such rebate since 2013.

The Maine Bureau of Insurance has approved a 4.3 percent decrease in the workers’ compensation insurance “loss cost” rate, which is expected to save Maine employers a combined $9.5 million over the next 12 months.

These are just recent examples of rate reductions occurring across the nation.  SB 899 was of course a good start for California.  It may not be the last successful play that is needed.

Lawyers Troll Carriers for MSP Recoveries – Who’s Next?

Miami lawyers expect a recent state court victory to pave the way for billions of dollars from liability and workers’ compensation insurance carriers across the nation to flow back to Medicare and its beneficiaries.

The attorneys, John Ruiz and Frank Quesada of the firm MSP Recovery, are going after major liability insurers for allegedly shirking their duty to reimburse Medicare benefit providers for conditional payments. Under the Medicare Secondary Payer law known by the acronym MCP, the government can recover double damages from a primary payer that fails to pay Medicare back for medical expenses covered by a liability policy

The home page of the firm boasts of the slogan aimed to attracted its clients who are Medicare Advantage insurance companies, challenging them to “DISCOVER YOUR LOSSES – RECOVER WHAT’S YOURS.”

According to the report in Daily Business Review, “Between 8 to 10 percent of all claims that are made through Medicare or Medicare Advantage Organizations are the responsibility of another payer,” Ruiz said – think car crashes, slip-and-fall accidents and workers’ compensation claims. “That’s a substantial amount because Medicare is paying in the vicinity of $600 billion a year.”

No attorney had ever secured class certification under the Medicare Secondary Payer law. A nuanced interplay between federal and state laws made it difficult to establish common issues of law and fact.

But MSP Recovery overcame those obstacles in Miami-Dade Circuit Court, where Judge Samantha Ruiz Cohen certified a class in a lawsuit against the auto insurer Ocean Harbor Casualty Insurance, a primary payer for thousands of Medicare Part C beneficiaries. In a 101-page decision, the judge ruled Medicare Advantage Organizations and others who contract with the government to provide Medicare benefits could sue Ocean Harbor as a class following an August federal appellate court decision.

That Eleventh Circuit decision, which arose from the Southern District of Florida case Humana v. Western Heritage, established that secondary payers could recover from a liability insurer if the case met three conditions: the defendant was a primary payer, the defendant failed to provide for primary payment or appropriate reimbursement, and the damages amount was established.

In state court, Ruiz Cohen ruled Ocean Harbor could not challenge the damages amounts because there was no evidence the auto insurer administratively contested any amounts paid, and the time for any administrative appeal had expired. Because of that failure to contest the reimbursement claims, all primary payer disputes arise under the Medicare Act, she ruled.

“Each class member will have incurred the same type of injury proximately caused by the same defendant based on the same general factual scenario, a failure to pay or reimburse as a primary payer for medical bills that resulted from an automobile accident during the claims period,” she wrote in the February order.

The judge also noted MSP Recovery has developed a sophisticated system to identify claims by collecting and matching data including Centers for Medicare & Medicaid Services reports, automobile crash reports, ambulance records, insurance declaration sheets and no-fault personal injury protection payout sheets.

The national penchant for claim “analytics” used to search for fraudulent claims may be a sword that swings both ways. “We’re able to figure out if someone that has had an incident – a car accident, a slip-and-fall – if another insurance carrier has reported to the government that they have a primary payer responsibility,” said Ruiz, also known for his variety of business enterprises, such as La Ley Sports.

That system has allowed the 30-attorney firm with roughly three dozen partner firms across the country to divide claims into categories and file lawsuits across the country on behalf of more than 100 health plans. Their firms boasts of about 17 class actions pending in state and federal courts across the nation.  Targeted defendants include companies such as Allstate Property & Casualty, Liberty Mutual, State Farm Mutual Automobile, Geico and others.

The class certification ruling is on appeal. Ocean Harbor attorney Shannon McKenna of Conroy Simberg in Hollywood said the company does not comment on pending litigation.

Ruiz and Quesada believe their cases will not only recover billions of dollars but will push primary payers to follow the law. The attorneys have already seen liability insurers change their payment practices because of the litigation.

“Before, it was almost like, ‘Catch me if you can,'” Ruiz said. “Now that we caught them, they are doing things differently.”

Cigna Reduces Opioid Use 12%

Since announcing its commitment to combat the nation’s opioid epidemic last year, Cigna has made significant progress toward reaching its goal to reduce opioid use among its customers with the help of health care providers. Within the last 12 months, Cigna customers’ use of prescribed opioids has declined nearly 12 percent – about halfway to achieving the company’s goal of 25 percent reduction by 2019.

While Cigna has adopted a multi-pronged response to the epidemic that includes multiple stakeholder groups, the key to this initial progress has been Cigna’s work with doctors, especially those that participate in its Cigna Collaborative Care arrangements.

To date, 158 medical groups participating in Cigna Collaborative Care, representing nearly 62,000 doctors, have signed Cigna’s pledge to reduce opioid prescribing and to treat opioid use disorder as a chronic condition.

“The opioid epidemic is far too big for any one person or organization to fight alone. Success will require the efforts of multiple stakeholders,” said Cigna President and CEO David Cordani. “e commend those who have joined the battle with us. Our collective steps are making a notable difference in the lives of our customers and their families. The decline in opioid use that we have seen in just one year is encouraging and reinforces how much more we can accomplish as we continue to work together.”

Cigna assists doctors in preventing, recognizing and treating opioid misuse by:

– – Analyzing integrated claims data across pharmacy and medical benefits to detect opioid use patterns that suggest possible misuse by individuals, and then notifying their health care providers. This helps identify individuals with substance use disorders more quickly so they can get the help they need.
– – Alerting doctors when their opioid prescribing patterns are not consistent with the Centers for Disease Control and Prevention’s (CDC) guidelines that include opioid selection, dosage, and duration.
– – Establishing a database of opioid quality improvement initiatives for doctors that can help them determine next steps for improving patient care, including referrals into chronic pain management or substance use disorder treatment programs.

Cigna is also implementing additional customer safety measures in support of the CDC guidelines. Effective July 1, most new prescriptions for a long-acting opioid that are not being used as part of treatment for cancer or sickle cell disease, or for hospice care, will be subject to prior authorization, and most new prescriptions for a short-acting opioid will be subject to quantity limits. According to the CDC, drug overdoses are the leading cause of accidental death in the United States. Of the overdose deaths that occurred in 2015, 63 percent involved an opioid.

“A a country, we have developed an overreliance on opioids to manage pain. If we’re going to break the opioid epidemic, we need to change that culture,”Cordani said. “Helping doctors become more aware of their own prescribing patterns and the effectiveness of non-narcotic alternatives for pain management is key to helping our customers have better health outcomes. For those who have become dependent on opioids, we need to treat them as compassionately as we would someone suffering from any other chronic disease and help them with recovery.”

Cigna continues to work closely with Shatterproof, a national nonprofit organization dedicated to reducing the devastation that addiction causes to families and the stigma associated with this disease. A Cigna Foundation grant helped the organization launch a comprehensive online portal earlier this year. It has the most up-to-date, evidence-based information on how to understand, prevent, intervene, treat, and recover from substance use disorders.

Liability Policy has “No Potential” Comp Coverage

Sacramento Lopez brought an action against plaintiffs Elena Delgadillo and Jesus Cortes in 2009 (the Lopez litigation), alleging he had suffered injuries in a fall from the roof of plaintiffs’ property in Hayward, where he was working as their employee.

Lopez also alleged  Delgadillo and Cortes had violated Labor Code requirements to pay overtime wages and provide meal and rest breaks. Plaintiffs Delgadillo and Cortes tendered the defense of the Lopez litigation to their business owner’s insurance carrier, United States Liability Ins. Co. (USLI), which denied plaintiffs’ claim.

Plaintiffs’ insurance policy contained the following exclusions pertinent to this case: “d. Workers’ Compensation And Similar Laws [¶] Any obligation of the insured under a workers’ compensation, disability benefits or unemployment compensation law or any similar law. [¶] e. Employer’s Liability [¶] “Bodily Injury’ to: [¶] (1) An ’employee’ of the insured arising out of and in the course of: [¶] (a) Employment by the insured; or [¶] Performing duties related to the conduct of the insured’s business[.] [¶] . . . [¶] This exclusion applies: [¶] (1) Whether the insured may be liable as an employer or in any other capacity . . .”

Plaintiffs Delgadillo and Cortes brought this action against USLI. Their causes of action for breach of contract and breach of the covenant of good faith and fair dealing were based on the theory that USLI had a contractual obligation to defend and indemnify them in the Lopez litigation. The remaining causes of action alleged in addition that USLI, through an agent, misled plaintiffs as to the coverage it would provide.

USLI demurred to the second amended complaint, primarily on the ground the policy did not cover Lopez’s claims for bodily injury or Labor Code violations.

The trial court sustained the demurrer to the Delgadillo and Cortes action against USLI without leave to amend. It took judicial notice of the verdict form for the negligence claim in the Lopez litigation, which indicated Lopez sustained his injury during the course of his employment by Delgadillo and Cortes. Because the policy explicitly excluded coverage for bodily injury sustained by an employee in the course of employment, the court ruled, plaintiffs could not state a cause of action for breach of contract against USLI.

The court of appeal affirmed the dismissal in the unpublished case of Delgadillo v. United States Liability Ins. Co..

The trial court correctly concluded the policy provided no potential for coverage, and therefore USLI had no duty to defend plaintiffs in the Lopez litigation and there was no breach of contract. Plaintiffs suggest no theory upon which their remaining causes of action for breach of the implied covenant of good faith and fair dealing, fraud, deceit, and intentional infliction of emotional distress may be maintained in the absence of a duty to defend.