Carson Tahoe Health System, which owns Carson Tahoe Physician Clinics and Carson Tahoe Continuing Care Hospital, has agreed to pay $8,876,475.45 to settle allegations that they were not eligible for the four Paycheck Protection Program loans that they obtained, Acting U.S. Attorney Michele Beckwith announced.

Congress created the Paycheck Protection Program (PPP) in March 2020, as part of the Coronavirus Aid, Relief, and Economic Security Act, to provide relief to small businesses experiencing economic hardship during the COVID-19 pandemic. To qualify for a loan, businesses were required to meet certain eligibility requirements accounting for any affiliated entities. The United States contends that Carson Tahoe Health System and its affiliated entities were ineligible to receive PPP loans because they exceeded the size limitations in the Small Business Administration’s affiliation rules.

In May 2020, Carson Tahoe Health System, Carson Tahoe Physician Clinics, and Carson Tahoe Continuing Care Hospital each received a PPP loan, totaling $5,077,011 in loan disbursements. After receiving their loan forgiveness applications, the Small Business Administration forgave these loans. In February 2021, Carson Tahoe Physician Clinics applied for a second PPP loan of $2 million. After Carson Tahoe Physicians Clinic requested loan forgiveness in September 2021, the SBA forgave this PPP loan. The four loans resulted in the United States paying $7,267,009 including forgiven loan principal and interest, and lenders fees.

SBA’s General Counsel Wendell Davis stated, “The favorable settlement in this case is the product of enhanced efforts by federal agencies such as the Small Business Administration working with the U.S. Attorney’s Office and SBA’s Office of Inspector General to pursue recovery from those who obtained essential government program funds when they were ineligible to do so.”

The settlement stems from allegations originally brought in a lawsuit filed by a whistleblower under the qui tam provisions of the False Claims Act, which allow private parties, known as relators, to bring suit on behalf of the government and to share in any recovery. In connection with the settlement, the relator will receive a percentage of the recovery.

“This settlement returns millions of taxpayer dollars to the government and reflects our ongoing commitment to enforce the requirements of the Paycheck Protection Program and ensure that only eligible businesses received this critical pandemic relief,” said Acting U.S. Attorney Beckwith.

The matter was handled by Assistant U.S. Attorney Tara Amin for the Eastern District of California.The claims resolved by this settlement are allegations only, and there has been no determination of liability.

The California Workers’ Compensation Institute (CWCI) has received state approval of an update to its “Facts About Workers’ Compensation” new hire notice which claims organizations and employers use to meet the statutory requirements to provide new employees with basic information about workers’ compensation (Labor Code §3551).

CWCI revised its new hire notice after Gov. Newsom signed AB 1870 last year. That bill amended Labor Code §3550 to require the addition of information on an employee’s right to consult an attorney to the workers’ compensation posting notice (DWC 7 form) that employers must display at their worksites. The change to the posting notice led to a similar revision to CWCI’s new hire notice because under state law (Labor Code §3551) new employees must receive written notice of the information in Labor Code §3550.  

Workers’ compensation notice requirements [Labor Code §3550(f) and §3551(c)] also specify that insurers shall provide the posting notices and new hire notices to their policyholders with advice concerning the statutory notice requirements and penalties for failure to provide the notices to employees. These can include audit penalties, loss of employer medical control, thousands of dollars in civil penalties for each violation of the posting requirement, and a tolling of the statute of limitations for filing a claim.

Following enactment of AB 1870, the state Division of Workers’ Compensation revised the DWC 7 posting notice and made it available online.

State regulations [CCR 9883(a)] allow private enterprises to prepare and publish their own versions of the Written Notice to New Employees if it is approved by the Division, so CWCI revised and submitted an updated copy of its Facts About Workers’ Compensation for review and approval. The state approved the revised version last month, after which the Institute copyrighted its notice, translated it into Spanish, typeset the revised versions, and had them printed.

The updated Facts About Workers’ Compensation Notice to New Employees in English and Spanish is now in stock and available for purchase along with the 5-part DWC-1 Claim Form and Notice of Potential Eligibility, which did not need to be updated, and CWCI’s Facts For Injured Workers pamphlet, which is not mandatory, but is often used early in the life of a claim to remind injured workers of their rights and obligations.

All of these publications are available in sets of 100 through the Institute’s online store. CWCI members are eligible for a 15 percent discount on these products if the subtotal on their order is $1,000 or more. For questions about ordering, call CWCI at (510) 251-9470.

W.A. Rasic Construction is a general contractor specializing in infrastructure projects across the Western United States. Their headquarters is located at 4150 Long Beach Boulevard, Long Beach, CA 90807. The company has been in operation since 1978 and is known for its diverse expertise in utility construction.

The California Division of Occupational Safety and Health (Cal/OSHA) has issued $157,500 in citations to W. A. Rasic Construction for multiple violations of workplace safety regulations following a fatal trench collapse. The incident resulted in the tragic death of an employee working in an unprotected excavation.

On August 28, 2024 Joel Olea Gomez and another worker were in the trench in the Scripps Ranch community in San Diego when a cave-in occurred at about 4 a.m. The men were working on a city water project.The collapse caused a concrete pipe to be displaced.

One of the workers escaped the trench, but 27-year-old Joel Olea Gomez became trapped at the bottom under dirt and a 4-foot-diameter reinforced concrete pipe. He was pronounced dead on the scene by San Diego Fire-Rescue personnel. His body was recovered at about 9 a.m. after an extensive operation. This is the third trench death in California since 2023.

Cal/OSHA’s investigation identified serious violations of workplace safety regulations related to excavation and trench safety.

Violations Identified by Cal/OSHA:

– – Failure to implement an effective injury and illness prevention program: W. A. Rasic Construction did not implement an effective injury and illness prevention program to identify, evaluate, and correct workplace hazards, and provide training, a requirement that has been in place for more than 30 years. This failure exposed employees to the hazards associated with working in an unshored trench.
– – Failure to conduct a proper inspection of the excavation site: The employer’s inspection failed to identify conditions that could lead to dangerous cave-in hazards or the lack of necessary protective systems, such as trench boxes or shoring, which could have prevented the collapse.
– – Failure to Provide Adequate Cave-In Protection: The employer did not provide the necessary cave-in protection for employees working in an excavation approximately 17 feet deep. This critical safety failure exposed workers to the risk of fatal injury, as evidenced by the incident. Employers have the right to appeal any Cal/OSHA citation and notification of penalty by filing an appeal with the Occupational Safety and Health Appeals Board within 15 working days from the receipt of notification.

Cal/OSHA Chief Debra Lee said: “No worker should lose their life due to preventable safety failures. We will continue to enforce trench safety regulations, hold employers accountable and work to ensure that safety standards are upheld to protect workers.”

Cal/OSHA helps protect workers from health and safety hazards on the job in almost every workplace in California. Employers and workers who have questions or need assistance with workplace health and safety programs can call Cal/OSHA’s Consultation Services Branch at 800-963-9424.

A Petition for Disqualification of a Workers Compensation Judge was filed with the WCAB by an applicant attorney in a pending case. The basis of the Petition was that the WCJ expressed “an opinion regarding a legal or factual issue” during the course of the proceedings and before the case was litigated and resolved.

However the petitioner failed to “show that this opinion is a fixed one that could not be changed upon the production of evidence and the presentation of arguments at or after further hearing.”

After filing the Petition for Disqualification, but prior to any decision by the WCAB, a different WCJ approved a Compromise and Release between the parties. Once the issue in a petition is moot, or if the case is resolved in its entirety, the petition is subject to dismissal. Nonetheless, the WCAB went on to discuss the merits and then denied the Petition in the case of John Guy v AV Decking – ADJ9709184 (May 2025).

Labor Code section 5311 provides that a party may seek to disqualify a WCJ upon any one or more of the grounds specified in Code of Civil Procedure section 641. (Lab. Code, § 5311; see also Code Civ. Proc., § 641.) Among the grounds for disqualification under section 641 are that the WCJ has “formed or expressed an unqualified opinion or belief as to the merits of the action” (Code Civ. Proc., § 641(f)) or that the WCJ has demonstrated “[t]he existence of a state of mind … evincing enmity against or bias toward either party” (Code Civ. Proc., § 641(g)).

Under WCAB Rule 10960, proceedings to disqualify a WCJ “shall be initiated by the filing of a petition for disqualification supported by an affidavit or declaration under penalty of perjury stating in detail facts establishing one or more of the grounds for disqualification … .”

It has long been recognized that “[t]he allegations in a statement charging bias and prejudice of a judge must set forth specifically the facts on which the charge is predicated,” that “[a] statement containing nothing but conclusions and setting forth no facts constituting a ground for disqualification may be ignored,” and that “[w]here no facts are set forth in the statement there is no issue of fact to be determined.” (Mackie v. Dyer (1957) 154 Cal.App.2d 395, 399.

Furthermore, even if detailed and verified allegations of fact have been made, it is settled law that a WCJ is not subject to disqualification under section 641(f) if, prior to rendering a decision, the WCJ expresses an opinion regarding a legal or factual issue but the petitioner fails to show that this opinion is a fixed one that could not be changed upon the production of evidence and the presentation of arguments at or after further hearing. (Taylor v. Industrial Acc. Com. (Thomas) (1940) 38 Cal.App.2d 75, 79-80 [5 Cal.Comp.Cases 61].) – [Overruled on other grounds in Lumbermen’s Mut. Cas. Co. v. Industrial Acc. Com. (Cacozza) (1946) 29 Cal.2d 492, 499 [11 Cal.Comp.Cases 289] ].-

Additionally, even if the WCJ expresses an unqualified opinion on the merits, the WCJ is not subject to disqualification under section 641(f) if that opinion is “based upon the evidence then before [the WCJ] and upon the [WCJ’s] conception of the law as applied to such evidence.” (Id.; cf. Kreling v. Superior Court (1944) 25 Cal.2d 305, 312 [“It is [a judge’s] duty to consider and pass upon the evidence produced before him, and when the evidence is in conflict, to resolve that conflict in favor of the party whose evidence outweighs that of the opposing party.”].)

Also, it is “well settled … that the expressions of opinion uttered by a judge, in what he conceives to be a discharge of his official duties, are not evidence of bias or prejudice” under section 641(g) (Kreling, supra, 25 Cal.2d at pp. 310-311; accord: Mackie, supra, 154 Cal.App.2d at p. 400) and that “[e]rroneous rulings against a litigant, even when numerous and continuous, form no ground for a charge of bias or prejudice, especially when they are subject to review” (McEwen v. Occidental Life Ins. Co. (1916) 172 Cal. 6, 11; accord: Mackie, supra, 154 Cal.App.2d at p. 400.)

Similarly, “when the state of mind of the trial judge appears to be adverse to one of the parties but is based upon actual observance of the witnesses and the evidence given during the trial of an action, it does not amount to that prejudice against a litigant which disqualifies” the judge under section 641(g). (Kreling, supra, 25 Cal.2d at p. 312; see also Moulton Niguel Water Dist. v. Colombo (2003) 111 Cal.App.4th 1210, 1219 [“When making a ruling, a judge interprets the evidence, weighs credibility, and makes findings. In doing so, the judge necessarily makes and expresses determinations in favor of and against parties. How could it be otherwise? We will not hold that every statement a judge makes to explain his or her reasons for ruling against a party constitutes evidence of judicial bias.”].)

Under no circumstances may a party’s unilateral and subjective perception of bias afford a basis for disqualification. (Haas v. County of San Bernardino (2002) 27 Cal.4th 1017, 1034; Robbins v. Sharp Healthcare (2006) 71 Cal.Comp.Cases 1291, 1310-1311 (Significant Panel Decision).)

Christian L. Johnson sued his employer, California Department of Transportation based on claims arising out of his employment. He alleged fifteen claims against Caltrans, including for discrimination, harassment, and retaliation.

While the suit was pending, Paul Brown, an attorney for Caltrans, sent an email about the litigation to Nicolas Duncan, Johnson’s supervisor who was not named in the litigation.

The email contained a “CONFIDENTIALITY NOTICE” that stated: “This is a privileged attorney-client communication and/or is covered by the attorney work-product doctrine. It is for the sole use of the intended recipient(s). Any unauthorized review, use, disclosure, or distribution is prohibited. If you are not the intended recipient, please contact the sender by reply e-mail and destroy all copies of the original message. Do not print, copy or forward.”

Unbeknownst to Caltrans, Duncan took a photograph of the email and sent it to Johnson, who gave it to his attorney, John Shepardson. It is unclear why Duncan did this.

The next day, Shepardson emailed Caltrans’s counsel, Christopher Sims, attaching the image and saying it “was sent to my client.” Shepardson asserted that the email was intentionally disclosed and so “appears to be a waiver of attorney-client privilege, if any privilege attaches to communications with Mr. Duncan.” Shepardson also stated that the email was “distressing” to Johnson and asked Caltrans to “cease and desist any and all communications with employees that are misleading about the merits of [Johnson’s] claims.”

After extensive meet-and-confer communications, Caltrans sought a protective order on the ground that the email was covered by the attorney-client privilege. The trial court entered the order. In the months that followed, the parties engaged in a protracted dispute concerning Johnson’s and Shepardson’s compliance with the protective order’s terms.

Eventually, Caltrans filed a motion to enforce the order and later a motion to disqualify plaintiffs attorney John Shepardson and three retained experts. The trial court disqualified Shepardson and the experts. In The trial court cited State Comp. Ins. Fund v. WPS, Inc. (1999) 70 Cal.App.4th 644, 656-657 (State Fund) and McDermott Will & Emery LLP v. Superior Court (2017) 10 Cal.App.5th 1083, 1108-1109 (McDermott), two cases involving a lawyer’s ethical duties upon receiving documents that are or may be privileged. The court said that Caltrans could have reasonably expected Shepardson to comply with his duties under State Fund. The trial court additionally determined that Shepardson’s conduct would prejudice the ongoing proceedings.

On appeal, Johnson challenged the trial court’s disqualification order. Among other arguments, he claims that the Brown email was not protected by the attorney-client privilege, Caltrans waived any privilege through undue delay, and the court abused its discretion in ordering the drastic remedy of disqualification.

The Court of Appeal found no merit in his arguments and affirmed the disqualification order in the published case of Johnson v. Dept. of Transportation – C099319 (March 2025).

“A trial court’s authority to disqualify an attorney derives from the power inherent in every court ‘[t]o control in furtherance of justice, the conduct of its ministerial officers, and of all other persons in any manner connected with a judicial proceeding before it, in every matter pertaining thereto.’ ” (People ex rel. Dept. of Corporations v. SpeeDee Oil Change Systems, Inc. (1999) 20 Cal.4th 1135, 1145.) “[U]ltimately the issue involves a conflict between a client’s right to counsel of his choice and the need to maintain ethical standards of professional responsibility.”

“Protecting the confidentiality of communications between attorney and client is fundamental to our legal system. The attorney-client privilege is a hallmark of our jurisprudence that furthers the public policy of ensuring ‘ “the right of every person to freely and fully confer and confide in one having knowledge of the law, and skilled in its practice, in order that the former may have adequate advice and a proper defense.” ’ ” (People ex rel. Dept. of Corporations v. SpeeDee Oil Change Systems, Inc., supra, 20 Cal.4th at p. 1146.)

“We conclude the trial court properly disqualified Shepardson and the three experts after finding that State Fund’s obligations were not satisfied. First, the trial court correctly determined that Shepardson breached his State Fund obligations after he received the Brown email. When he received the email, Shepardson properly notified Caltrans. (State Fund, supra, 70 Cal.App.4th at p. 657.) But the record supports the trial court’s conclusion that his actions thereafter fell short of what State Fund requires. After receiving the email, and especially after Caltrans unequivocally asserted the privilege hours after learning of the disclosure, Shepardson was not permitted to examine the email any further, much less distribute the email to other witnesses or use it to formulate case strategy, pending an agreement between the parties or judicial intervention.”

Footnote 2 on page 25 notes that the State Fund requirements were codified in rule 4.4 of the California State Bar Rules of Professional Conduct.