Tag: 2023 News

Drickey Jackson is a driver for Amazon’s delivery program known as Amazon Flex. Amazon engages these individuals to make deliveries in their own cars. Amazon describes them as “delivery partners” who sign up through the Amazon Flex app on a smartphone and deliver food and grocery orders from Whole Foods Market stores, Amazon Fresh locations, and other local stores, as well as packages and orders of goods from Amazon Delivery Stations, using their personal vehicles.

When Jackson signed up for the Flex program in December 2016, he accepted the 2016 TOS. It contained an arbitration clause that applied to disputes related to that agreement: The 2016 TOS stated that Flex participants were “responsible for reviewing this Agreement regularly to stay informed of any modifications.”

Amazon emailed a new TOS to Amazon Flex drivers in 2019, which contained a broader arbitration provision that made the issue of arbitrability itself subject to arbitration. Jackson continued in the program after 2019.

In February 2021, Jackson filed a class action lawsuit against Amazon in the United States District Court for the Southern District of California, alleging that it wiretapped Flex drivers’ communications and invaded their privacy by monitoring their closed Facebook groups. Jackson sought to represent a class of all Flex drivers in the United States who were members of the closed Facebook groups and allegedly had communications intercepted by Amazon without their consent. He also sought to represent a subclass of members in California.

The complaint alleged that during times when they were not working, the members of these groups communicated about matters of mutual interest. These included “planned strikes or protests, pay, benefits, deliveries, driving and warehouse conditions, unionizing efforts, and whether workers had been approached by researchers examining Amazon’s workforce.“

Jackson contends that Amazon monitored and wiretapped the drivers’ conversations when they communicated during off hours in closed Facebook groups. He claimed damages. And injunctive relief for alleged privacy violations of state and federal laws: the California Invasion of Privacy Act (Cal. Penal Code §§ 631, 635); invasion of privacy under California’s Constitution; the Federal Wiretap Act for the interception and disclosure of wire, oral, or electronic communications (18 U.S.C. §§ 2510, et seq.) and for the manufacture, distribution, possession, and advertising of wire, oral, or electronic communication (18 U.S.C. § 2512); and the Stored Communications Act (18 U.S.C. §§ 2701, et seq.).

Amazon moved to compel arbitration pursuant to the arbitration clause of the 2019 TOS under California law. The district court denied Amazon’s motion to compel. The court ruled that under California law, the 2016 TOS applied because Amazon had not shown that it provided individualized notice to Jackson of a 2019 TOS, and such individualized notice was necessary to establish mutual assent to the 2019 arbitration provision.

The district court further concluded that the claims of Amazon’s unlawful conduct fell outside the scope of the arbitration clause in the 2016 TOS because the claims were not related to the parties’ performance under the agreement.

The 9th Circuit Court of Appeals affirmed (with Judge Graber dissenting) in the published case of Jackson v Amazon – 3:20-cv-02365-WQH-BGS (April 2023).

Under California law and generally applicable principles of contract law, the burden is on Amazon as the party seeking arbitration to show that it provided notice of a new TOS and that there was mutual assent to the contractual agreement to arbitrate. Mutual assent requires, at a minimum, that the party relying on the contractual provision establish that the other party had notice and gave some indication of assent to the contract.

Here there was “no evidence that the email allegedly sent to drivers adequately notified drivers of the update. The district court did not have the email, so it could not evaluate whether the email (assuming it was received at all) sufficed to provide individualized notice.”

Jackson’s claims do not depend on any terms of his contract as a driver for Amazon Flex. And the harm Jackson alleges “is not measured by or dependent on the terms of” his work for Flex; rather, it involves Amazon’s alleged breach of wiretapping statutes and invasion of privacy.

“In this case, the allegations underlying Jackson’s claims involve employer misconduct wholly unrelated to the parties’ agreement.”

Brent Reynolds, sustained an injury on October 16, 2012 to his shoulder and wrist that arose out of and in the course of his employment as a sales representative for Hostess Brands.

The parties agreed to use Dr. Robert Fenton as an Agreed Medical Evaluator in Orthopedic Surgery. Defense counsel scheduled Dr. Fenton’s cross-examination to take place on August 15, 2016.

In May, Dr. Fenton transmitted a proposed deposition fee agreement to Defense counsel’s office, seeking Defendant’s acknowledgment and agreement to pay a $781.25 non-refundable deposit for the schedule cross-examination. Defense counsel executed this agreement on May 6, 2016, but did not copy opposing counsel when transmitting this now fully executed agreement back to Dr. Fenton. The deposition was eventually re-scheduled to October 31, 2016. The Defendant would ultimately pay the requested deposit, which Dr. Fenton would receive on or around October 19, 2016.

Applicant counsel requested that the October 31, 2016 cross-examination be re-scheduled. Dr. Fenton refused to waive his non-refundable deposit policy, and intended to charge the parties with an additional $781.25 for any re-scheduled deposition.

Around this time, Applicant counsel learned of the Defendant’s payment of a $781.25 non-refundable deposit, which he then objected to as being in excess of fee schedule. Applicant counsel then wrote a letter directly to Dr. Fenton on October 27, 2016, objecting to the cross-examination in its entirety, contending that Dr. Fenton was paid in excess of the fee schedule.

He further filed a Request to Strike Dr. Fenton and Petition for Costs, Sanctions, and Attorney’s Fees for Bad Faith Tactics, which in no uncertain terms accused Defendant of paying fees in excess of the fee schedule to attempt to sway Dr. Fenton to provide a more favorable opinion; Dr. Fenton was copied on this Petition.

In response, Defendant filed its own Petition for Costs and Sanctions on October 31, 2016 and its own Petition to Strike Dr. Fenton on November 2, 2016.

The WCJ ultimately ordered that Dr. Fenton be stricken as the agreed medical evaluator, but deferred action on the competing Petitions for Fees and Costs. The parties eventually settled the case via Stipulations with Request for Award based on a newly selected QME  reporting.

After a trial on the unresolved issue of the competing Petitions for Sanctions, the WCJ concluded that Applicant counsel’s challenge of the AME Dr. Fenton’s cross-examination fees was not bad faith as he possessed the statutory right to challenge the same. However, the Applicant’s conduct in communicating his objections to Dr. Fenton were in violation of Labor Code section 4062.3.

The WCJ further found that the Defendant’s payment of the $781.25 deposit was not done in bad faith as the fee was not in excess of the medical-legal fee schedule. However, Defendant also violated Labor Code section 4062.3 for failing to serve opposing party with the cross-examination fee agreement.

As a result the WCJ ruled that “neither party acted with clean hands, and that both Defendant and Applicant’s respective Petitions for Costs and Fees are denied.” A Petition for Reconsideration filed by the Defendant was denied in the panel decision of Reynolds v Hostess Brands – ADJ9714303 (February 2023).

The Defendant challenged the finding that their May 6, 2016 communication with Dr. Fenton was ex parte. as being a nonsubstantial communication. They argued it was just administrative, and therefore did not violate Labor Code section 4062.3(f).

In support of this position Defendant argued that the communication about the QME fees is “currently part of the CA workers’ compensation culture,” and that a finding from the WCAB that these communications “must be copied on all parties would essentially require a re-ordering of our whole workers’ compensation system.”

However, in the WCJs view, a fee agreement for a scheduled cross-examination goes beyond what the Petitioner characterized as “simple messages or administrative tasks.”

Various statutory and regulatory protections are designed to prevent a provider from receiving excessive fees. They support the conclusion that communications with an agreed medical evaluator regarding the payment of or an agreement to pay fees/deposit for a cross-examination cannot be deemed a nonsubstantial matter, particularly in light of the parties’ statutory right to challenge such fees.

Dr. Fenton’s non-refundable deposit policy seemingly conflicts with Code of Civil Procedure section 2034.450(a). Despite this, Defendant paid the deposit, which Dr. Fenton received on October 19, 2016.

“It is unclear why Defendant did not challenge this restrictive deposit and cancellation policy given that the Code of Civil Procedure section 2034.450(a) allows parties to issue payment at the commencement of the cross-examination. And this further supports the importance of apprising the opposing party of any such fee agreement.”

A former California physician, 54 year old Julian Omidi who lives in West Hollywood, was sentenced Monday to seven years behind bars for using fabricated sleep studies to persuade insurance companies to pay out tens of millions of dollars for Lap-Band surgery. Fines and restitution are to be determined at a hearing in June.

The U.S. Attorney’s office reported that the former doctor and his company were found guilty in December 2021 by a federal jury of scheming to defraud private insurance companies and the Tricare health care program for military service members by fraudulently submitting an estimated $355 million in claims related to the 1-800-GET-THIN Lap-Band surgery business.

Julian Omidi, 53, of West Hollywood, and an Omidi-controlled Beverly Hills-based company, Surgery Center Management LLC (SCM), were found guilty of 28 counts of wire fraud and three counts of mail fraud. Omidi also was found guilty of two counts of making false statements relating to health care matters, one count of aggravated identity theft and two counts of money laundering. Omidi and SCM were found guilty of one count of conspiracy to commit money laundering.

According to evidence presented at his three-month trial, Omidi, a physician whose license was revoked in 2009, controlled, in part, the GET THIN network of entities, including SCM, that focused on the promotion and performance of Lap-Band weight-loss surgeries. Omidi established procedures requiring prospective Lap-Band patients – even those with insurance plans he knew would never cover Lap-Band surgery – to have at least one sleep study, and employees were incentivized with commissions to make sure the studies occurred.

Omidi used the sleep studies to find a reason – the “co-morbidity” of obstructive sleep apnea – that GET THIN would use to convince the patient’s insurance company to pre-approve the Lap-Band procedure.

After patients underwent sleep studies – irrespective of whether any doctor had ever determined the study was medically necessary – GET THIN employees, acting at Omidi’s direction, often falsified the results. Omidi then used the falsified sleep study results in support of GET THIN’s pre-authorization requests for Lap-Band surgery.

Relying on the false sleep studies – as well as other false information, including patients’ weights – insurance companies authorized payment for some of the proposed Lap-Band surgeries. GET THIN received an estimated $41 million for the Lap-Band procedures.

Even if the insurance company did not authorize the surgery, GET THIN still was able to submit bills for approximately $15,000 for each sleep study, receiving an estimated $27 million in payments for these claims. The insurance payments were deposited into bank accounts associated with the GET THIN entities.

Prosecutors estimate Omidi’s total fraudulent billings at approximately $355 million. The victim health care benefit programs include Tricare, Anthem Blue Cross, UnitedHealthcare, Aetna, Health Net, Operating Engineers Health and Welfare Trust Fund, and others. In 2014, the government seized more than $110 million in funds and securities from accounts held by individuals and entities involved in the criminal scheme, including Omidi.

According to Courthouse News, prosecutors had asked for a sentence of 22 years, even though under federal sentencing guidelines, Omidi could be sent to prison for life given the high amount of “intended” financial losses to his victims, including TRICARE, the U.S. military’s health care program.

The judge said she believed that the crimes Omidi had committed were serious but that the federal guidelines for fraud convictions were disproportionate.

“You could have earned a fine living without resorting to fraud,” she told Omidi, referring to his family background and education. “You should have known better.”

Omidi, before the judge imposed the sentence, told her that he was sorry and ashamed to be standing before the court.  “I live in constant remorse,” he said. “I worked hard all my life and tried to do the right thing. I didn’t want to harm anyone.”

Omidi’s lawyers had asked for a sentence of as low as 24 months in prison, arguing that the actual losses to the insurers were far less than the intended losses the government claimed and that two years incarceration would be sufficient punishment for a middle-aged man who has never been to prison before.

Omidi’s mother, Cindy, was sentenced to probation in 2015 after she was convicted of violating laws designed to prevent money laundering.

The expanded availability of opioid use disorder-related telehealth services and medications during the COVID-19 pandemic was associated with a lowered likelihood of fatal drug overdose among Medicare beneficiaries, according to a new study just published in JAMA Psychiatry,

This study is a collaborative research effort led by researchers at the National Center for Injury Prevention and Control, a part of the Centers for Disease Control and Prevention (CDC); the Office of the Administrator and the Center for Clinical Standards and Quality, both part of the Centers for Medicare & Medicaid Services (CMS); and the National Institute on Drug Abuse, a part of the National Institutes of Health (NIH).

In this national study, researchers analyzed data among two cohorts of Medicare beneficiaries to explore receipt of opioid use disorder-related telehealth services, receipt of medications for opioid use disorder, and fatal overdoses before and during the COVID-19 pandemic.

They compared data from two cohorts of Medicare beneficiaries across two time periods. The first cohort was constructed with data from September 2018-February 2020 and included 105,162 Medicare beneficiaries with opioid use disorder (the “pre-pandemic cohort”).

The second cohort was constructed with data from September 2019-February 2021 and included 70,479 Medicare beneficiaries with opioid use disorder, (the “pandemic” cohort).

In addition, the researchers conducted an analysis to examine the demographic and clinical characteristics associated with fatal overdose in the pandemic cohort.

Key findings of this study include:

– – Medicare beneficiaries that began a new episode of opioid use disorder-related care during the pandemic and received opioid use disorder-related telehealth services were found to have a 33% lower risk of a fatal drug overdose.
– – Medicare beneficiaries who received medications for opioid use disorder from opioid treatment programs (OTP) and those who received buprenorphine, one of the medications for opioid use disorder, in office-based settings also had reduced odds of a fatal drug overdose of 59% and 38%, respectively.
– – Mortality rates (classified as all-cause mortality and drug overdose mortality specifically) were higher in the pandemic cohort compared to the pre-pandemic cohort; however, the percentage of deaths due to drug overdose were similar between the two cohorts.

Although the results of this study were able to identify the positive impact opioid use disorder-related telehealth services had on lowering the risk for fatal drug overdose in the pandemic cohort, the authors note that only 1 in 5 Medicare beneficiaries in the pandemic cohort received OUD-related telehealth services.

Similarly, only 1 in 8 beneficiaries in the pandemic cohort received medications for opioid use disorder. These findings underscore the need for continued expansion of these potentially life-saving interventions across clinical settings.

“The results of this study add to the growing research documenting the benefits of expanding the use of telehealth services for people with opioid use disorder, as well as the need to improve retention and access to medication treatment for opioid use disorder,” said lead author Christopher M. Jones, PharmD, DrPH, Director of the National Center for Injury Prevention and Control, CDC. “The findings from this collaborative study also highlight the importance of working across agencies to identify successful strategies to address and get ahead of the constantly evolving overdose crisis.”

“At a time when more than 100,000 Americans are now dying annually from a drug overdose, the need to expand equitable access to lifesaving treatment, including medications for opioid use disorder, has never been greater,” said Wilson Compton, M.D., M.P.E, deputy director of the National Institute on Drug Abuse and senior author of the study. “Research continues to indicate that expanded access to telehealth is a safe, effective, and possibly even lifesaving tool for caring for people with opioid use disorder, which may have a longer-term positive impact if continued.”

“CMS is committed to ensuring that the beneficiaries we serve can access the high-quality behavioral health services they need,” said senior author Dr. Shari Ling, M.D., Deputy Chief Medical Officer at CMS. “This study shows that many beneficiaries were able to utilize opioid use disorder-related telehealth services during the pandemic, but we need to continue our efforts to broaden the use of telehealth, particularly in underserved communities.”

Kelly Gola and members of the class she represents were adjunct faculty – part-time university professors engaged to teach on a semester-by-semester basis – at the University of San Francisco.

Adjunct faculty at the University, of whom there are more than 600, are represented by a labor organization: the USF Part Time Faculty Association which had a Collective Bargaining Agreement (CBA) with the employer.

The University’s practice with respect to adjunct faculty was to hire them to teach individual classes on a semester-by-semester basis. For each semester, the University would issue appointment letters offering employment to prospective adjunct professors during a specified assignment period that ran from the first day of that semester’s classes to the end of the semester.

Gola filed a lawsuit against the University. Among other theories of recovery, as a first cause of action, the operative complaint alleged a claim for unpaid wages on behalf of Gola and a class of similarly situated adjuncts. According to this claim, the assignment letters set out the terms of an employment contract only for the period specified in the letters, i.e., the teaching semester, and set a salary for that period only.

Yet adjunct faculty were required to work outside that period to prepare syllabi and course materials before classes started, and to grade exams and submit final grades after classes ended, and they were not paid for their time outside the assignment period.

As a second cause of action, the operative complaint alleged that the University failed to issue wage statements in compliance with Labor Code section 226(a) because adjuncts’ wage statements did not include the total hours worked during the pay period and the effective hourly rate.

Finally, Gola asserted a derivative claim under the Private Attorneys General Act (PAGA) (§ 2698 et seq.) seeking civil penalties for the Labor Code violations asserted in counts one through three.

As an affirmative defense, the University asserted that Gola’s claims were preempted by The federal Labor Management Relations Act (LMRA) (29 U.S.C. § 141 et seq.). which preempts all state-law claims that require interpretation of a CBA.

This affirmative defense was bifurcated and tried to the court. Following the bench trial, the trial court issued a statement of decision holding that Gola’s first and third causes of action were indeed preempted because these claims could not be resolved without interpreting the CBA.

With respect to Gola’s second cause of action, the wage statement claim, the trial court determined this claim was not preempted by federal law. The wage statement claim proceeded to a bench trial on the merits. The trial court found that the wage statements the University issued to adjunct faculty did not include the “total hours worked by the employee” or the employee’s effective hourly rate. The trial court calculated statutory damages of $1,621,600 and PAGA penalties of $545,235. The trial court later issued an order awarding Gola $1,307,225.95 in attorneys’ fees and $21,510.23 in costs.

The University timely appealed the judgment, and Gola cross-appealed. The Court of Appeal affirmed the judgment in the published case of Gola v University of San Francisco – SF-A161477 (April 2023).

After the trial court issued its statements of decision and judgment, however, the Legislature enacted Labor Code section 515.7, which provides that faculty at nonprofit higher education institutions “shall be exempt” from the provisions of Labor Code section 226, subdivision (a)(2) and (9), provided they are employed in a professional capacity as defined in the statute, and provided they are paid a salary that meets at least one of three tests for minimum compensation (salary tests).

Among the various issues raised on appeal, the University contends that newly enacted Labor Code section 515.7 should be applied retroactively to this case. If it is so applied, the University contends, Gola’s section 226 claims must fail because Gola and the subclass will be classified as exempt for the relevant period.

The Court of Appeal noted that Labor Code Section 515.7 is plainly intended to create a pathway to accord adjunct faculty exempt professional status and relieve nonprofit universities of hour and pay reporting requirements for adjuncts, provided adjuncts’ pay meets one of the three salary tests. But the statute does not directly speak to whether it reaches back to hour and pay reporting obligations incurred before September 9, 2020 when it was adopted as an urgency measure, and thus taking effect that day.

The Court concluded “This silence in itself strongly indicates prospective application. Moreover, we find in the text of the statute itself an additional indication of prospective application…”