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1 SHEPPAR, MULIN, RICHTER& HAMPTON LLP
FRANK F ALZETT A (125146)MOE KESHA V ARI (223759)333 South Hope Street, 48th FloorLos Angeles , CA 90071- 1448Tel: (213) 620- 1780; Fac: (213) 620- 1398
Attorneys for DefendantSTATE COMPENSATION INSURNCEFUN
STATE COMPENSATION INSURNCEFUND
ROBERT W. DANRI (56833)JUITH D. SAPPER (116942)BETTY R. QUARES (155511)900 Corporate Center Drive, Suite 401
10 Monterey Park, CA 91754-7618Tel: (323) 526-2141; Fac: (323) 526-2012
Attorneys for Defendant12 STATE COMPENSATION INSURCE
FUND
MILAM & LARSEN , LLP14 PAUL A. LARSEN (136342)
234 E Colorado Boulevard, Suite 62015 Pasaden , CA 91101-2210
Tel: (626)585- 1888; Fac. (626) 585- 1886
Attorneys for Defendant17 REPUBLIC INDEMNITY COMPANY
OF CALIFORNIA
SONNNSCHEIN NATH& ROSENTHAL LLP
PAUL E.B. GLAD (79045)SEAN McENEANY (169105)685 Market Street, 6th FloorSan Francisco , CA 94105Tel: (415) 882-5000; Fac: (415) 543-5472
Attorneys for DefendantFIREMAN' FUN INSURNCE CO.
PROSKAUER ROSE , LLPLARY ALAN RAPAPORT (87614)2049 Century Park East, Suite 3200Los Angeles, CA 90067-3206Tel: (310) 557-2900; Fac: (310) 557-2193
Attorneys for DefendantZENITH INSURCE CO.
, GUMP, STRAUSS , HAUER& FELD , LLP
JOHN A. KACZYNSKI (93108)2029 Century Park East, Suite 2400Los Angeles, CA 90067Tel: (310) 229- 1000; Fac: (310) 229- 1001
Attorneys for DefendantsLIBERTY MUTUAL INSURACE CO.LIBERTY MUTUAL FIRE INSURNCECO. , LIBERTY MUTUAL INSURANCEGROUP , and HELMSMAN MANAGEMENTSERVICES , INe.
(OTHER DEFENDANTS AND COUNSEL LISTED AT END OF PLEADING)
WORKRS' COMPENSATION APPEALS BOARD
STATE OF CALIFORNIA
JACK HABLIAN, et al.
Plaintiffs
ZURICH, U. , et al.
Defendants.
) Case No. VNO 403724 , et al.
DEFENDANTS' JOINT PETITIONTO DISMISS APPLICANTS'SECOND AMENDED COMPLAINT
Date: August 30 , 2005Time: 1 :30 p.Place: Courtroom of the Hon. Roger A.
Tolman , Jr.
5477/9841-007LA WORD/69840v8
DEFENDANTS' JOINT PETITION TO DISMISS APPLICANTS' SECOND AMENDED COMPLAINT
II.
III.
IV.
5477/79841-007LA WORD/69840v8
TABLE OF CONTENTS
INTRODUCTION
.....................................................,""""""""""""""""""""""""'" ... ...
PROCEDUR HISTORY.................................................................................................
Dismissal of the Previous Pleadings ......
................ .................. ... ..... ......... ..... ....... ..
Applicants ' Second Amended Complaint..............................................................
ARGUMENT ............................................................................................................ .....
... ...
The WCAB Currently Does Not Have The Authority Or Rules AndProcedures Necessary To Hear Class Actions. ........................................................
The Legislature Has Not Authorized the WCAB to Hear ClassActions. ........................................................................................................ 6
Even if the WCAB Had the Authority to Hear Class Actions , ItLacks the Requisite Rules and Procedures to Do So. ................................
The Second Amended Complaint Violates Labor Code Section 5303 AndThe Rule Against Splitting A Cause of Action......................................................
Applicants ' Restitution Claim Is Neither Needed Nor Proper Since TheLabor Code Provides Applicants ' Exclusive Remedies ........................................
CONCLUSION................................................................................................................. .
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TABLE OF AUTHORITIES
CASES
Addin on v. Cave , 35 Cal. Compo Cas. 39 (1970) .............................................. , 10, 11 , 13 , 15
American Ps chometric Consultants Inc. V. Workers ' Com Appeals Bd.36 Cal. App. 4th 1626 (1995), rehearin denied (1995),review denied (1995) .................. ................................................................................... 6 , 19
Bell V. Industrial Accident Com. , 18 Cal. Compo Cas. 243 (1953) ...............................................
Beaida V. Workers ' Com o A eals Bd. , 263 Cal. App. 2d 204 (1968)........................................
Bernard V. Wall , 184 Cal. 612 (1921) ..............
................... ...........................................................
Charles J. Vacant Inc. V. State Com o Ins. Fund, 24 Cal. 4th 800 (2000)...................., , 17
Cross V. Pacific Gas & Electric Co. , 60 Cal. 2d 690 (1964).................................................
:.......
Currie V. Workers ' Co o A eals Bd. , 24 Cal. 4th 1109 (2001)...................................................
Med Inc. V. Fair E ment & Housin Com. , 43 Cal. 3d 1379 (1987) ........... , 10, 11 , 14
Glavitch V. Industrial Accident Com. , 44 Cal. App. 2d 517 (1944) ..............................................
Gold V. Los An eles Democratic Lea , 49 Cal. App. 3d 365 (1975) ........................................
Gracz k V. Workers ' Co Appeals Bd. , 184 Cal. App. 3d 997 (1986).................................. , 15
Greener V. Workers ' Com Appeals Bd. , 6 Cal. 4th 1028 (1993) ..................................................
Har rove v. Permanente Metals Co , 16 Cal. Compo Cas. 30 (1949).........................................
Hartford Accident & Indem. Co. v. Industrial Accident Com. , 216 Cal. 40 (1932)......................
Hilton Hotels Co . v. Workers ' Com o A eals Bd.60 Cal. Compo Cas. 1112 (1995), writ denied (1995).................................................. , 13
House V. Workers ' Com o A eals Bd. , 58 Cal. Compo Cas. 354 (1993),writ denied (1993), review denied (1993)......................................................................... .18
hes v. Ar onaut Insurance Com , 88 Cal. App. 4th 517 (2001).......................................
Masco Buildin Products Inc. v. Workers ' Com Appeals Bd.60 Cal. Compo Cas. 348 (1995), writ denied (1995),review denied (1995) .................................................................................................. . , 13
Moran v. Bradford Buildin Inc. , 57 Cal. Compo Cas. 273 (1992) .................................. , 13 , 14
Morris V. Williams , 67 Cal. 2d 733 (1967)....................................................................................
den v. WCAB , 11 Cal. 3d 192 (1974).......................................................................................
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Ramona Manor Convalescent Hos ital v. Care Ente rises177 Cal. App. 3d 1120 .(1986) ...........................................................................................
Rea v. Workers ' Com o A eals Bd. , 127 Cal. App. 4th 625 (2005) .............................. , 13 , 14
Roblesv. Workers ' Co o A eals Bd. , 60 Cal. Compo Cas. 536 (1995) ....................................
Rose V. Ci of Ha ard, 126 Cal. App. 3d 926 (1981 )......................................... ....................... 1 0
State Com o Iris. Fund V. Industrial Accident Comm. , 20 Cal. 2d 264 (1942)................................
Taliaferro V. Taliaferro , 144 Cal. App. 2d 109 (1956),cert denied 352 U.S. 971 (1957)......... ......
..................... ......................... .................. .. .... ..
Tidewater Marine Western Inc. V. Bradshaw, 14 Cal. 4th 557 (1996) ................................... , 14
Weaver v. Pasadena Tournament of Roses Assn. , 32 Cal. 2d 833 (1948).......................................
STATUTES
Cal. Civ. Proc. Code 9 382 ......................
..... ........ ...........................................................................
Cal. Gov. Code 9 11340...................................................................................................................
Cal. Gov. Code 9 11343......................................................... ....................................................... .
Cal. Gov. Code 9 11344.....
""'''''''''''''.......................................................................................... .
Cal. Gov. Code 9 11346.4(b)........................................................................................................ .
Cal. Gov. Code 9 11346.8............................. ........ ............................
........................................... ..
Cal. Lab. Code 9 111 (a)................................................................................................................... 6
Cal. Lab. Code 9 129 .................................... ............................................................................... ..
Cal. Lab. Code 9 133 ........
................ .................................................................... ........................ .
Cal. Lab. Code 9 139.5 ................................................................................................................. .
Cal. Lab. Code 9 3207 ................................... ............................................................................... .
Cal. Lab. Code 9 3208.2 .................................................................................................................. 7
Cal. Lab. Code 9 3600 ......................................................................................................... , 15 , 17
Cal. Lab. Code 9 3602 "".............................................................................................................. .
Cal. Lab. Code 9 3 602( a) ................................................................................................................. 6
Cal. Lab. Code 9 3753 ................................................................................................................. 6 , 7
Cal. Lab. Code 9 4642 .................................
.......... .......... ................................................. ...... .... ...
Cal. Lab. Code 9 4650 ..........
................... ............ ........ ..... ...... ....... ........ '''''''''''''''''''''''''''''''''''''' .... .
-ll-DEFENDANTS' JOINT PETITION TO DISMISS APPLICANTS' SECOND AMENDED COMPLAINT
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Cal. Lab. Code 9 4903 .. .................. ..... ................ ...................... ...... ......... .............. ..................... 7 , 9
Cal. Lab. Code.9 5300
'"'''''''''''''''''''''''''''''''''''''' ....................................,.... .......... ................ ...
, 11
Cal. Lab. Code 9 5303 ..
............................. ............. ,....... ..,............. ............... ........................
, 7, 15
Cal. Lab. Code 9 5307 ..................,.... .
................................................................................... ....... .
Cal. Lab. Code 9 5307(b)............................................................................................................. ..
Cal. Lab. Code 9 5307 (c)...
..................... ................... ..................................................... ...
, 13 , 14
Cal. Lab. Code 9 5307.4 ................... .....................................................
,................................ ...... .
Cal. Lab. Code 9 5307 . 5( a)................................... ........................................................................... 8
Cal. Lab. Code 9 5307 .5(b).............................................................................................................. 7
Cal. Lab. Code 9 5308 ................ . .................................................................................................... 8
Cal. Lab. Code 9 5311 ......
....................... ........ .................,................................... ...........................
Cal. Lab. Code 9 5316 .................................................................,.............................. .....................
Cal. Lab. Code 9 5601
"""""""""""",,,,,,,,,,,,,, ...............................................................................
Cal. Lab. Code 9 5708 .....................................................................................................................
Cal. Lab. Code 9 5710 ..
....................................... ............................................................................
CALIFORNIA CONSTITUTION
Cal. Const. Ar. 14 , 9 4 .................................................................................................................. 1 0
CALIFORNIA RULES OF COURT
Cal. Rules of Court, Rules 1850- 1861 ............................................................................................. 8
CALIFORNIA CODE OF REGULATIONS
lOCal. Code of Regs. 9 10401 ............ ......................... ............................. ......................................
lOCal. Code of Regs. 9 10590......
...... ............................................................................................
lOCal. Code of Regs. 9 10591 .................................................................................................... ....
TREATISES
11 Witkin Summary ofCal. Law (9th ed. 2004) Equity, 9 3....................................................... .14
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INTRODUCTION
By their Second Amended Complaint, Applicants once again ask this Court to
adjudicate a sweeping class action claim for benefits , penalties and interest allegedly owed to tens
of thousands of injured workers with admitted workers' compensation claims over a 15-year
period. Though Applicants have deleted all civil causes of action from their latest pleading, and
have limited their prayer for relief to a request for "traditional indemnity benefits" and
restitution " the Second Atended Complaint remains fatally defective for three reasons.
First, the Legislature has never authorized the Workers ' Compensation Appeals
Board (the "WCAB") to hear class actions. The Labor Code only permits individual claims by
employees and their dependents, and does not allow one injured employee to act as the
representative" of another injured employee in seeking compensation benefits. Moreover, the
court administrator has not adopted appropriate rules of practice and procedure for class actions
pursuant to Labor Code section 5307(c) and the Administrative Procedures Act (Cal. Gov. Code
99 11340 et seq ) (the "APA"). In order to adjudicate Applicants ' class action claim , this Court
necessarily would have to fashion a host of class action rules and procedures to avoid serious due
process concerns , including rules governing class certification, notice to class members
, "
opt out"
and intervention mechanisms, class discovery and the like. As the Court of Appeal recently
reaffrmed in Rea v. Workers , Compo Appea1s Bd., 127 Cal. App. 4th 625 , 647-48 (2005), the
WCAB may not resort to such ad hoc rules and procedures in violation of Section 5307 and the
AP A without "overstepping its authority.
Second, consistent with the common law rule against splitting a cause of action
Labor Code section 5303 provides that the only cause of action allowed at the WCAB is an
individual claim for compensation benefits. Each Applicant and proposed class member already
has filed such an individual claim. The Second Amended Complaint violates Section 5303 by
asking this Court to award them the very same "traditional indemnity benefits" that they either
have obtained, could obtain, or, iftheir individual claims have been resolved, could have obtained
in their individual claims. The law clearly forbids splitting a cause of action and litigating it twice
-- once as an individual claim and a second time as a purported class action.
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Third, Applicants again seek to augment the express remedies provided by division
4 of the Labor Code with the equitable remedy of "restitution. The remedies provided in
division 4 remain Applicants exclusive relief, and bar any claim for "restitution.
For all of these reasons , Defendants respectfully request that the Cour grant their
Joint Petition and dismiss Applicants' Second Amended Complaint without leave to amend.
II. PROCEDURL HISTORY
Dismissal of the Previous Pleadings
Applicants ' original "Class Action Complaint " fied on January 3 , 2001
unsuccessfully attempted to assert a cause of action under California s Unfair Competition Law
(the "UCL") on behalf of themselves and a putative class of California employees who had
sustained work-related injuries since 1990, and allegedly were paid less than the amount of
compensation benefits due to them under the law. The Complaint was dismissed because: (i) the
proposed class action was not a "superior" method of litigating the proposed class ' claims for
unpaid benefits and penalties; and (ii) those claims would require resolution of "individual and
complex" fact questions.
Applicants thereafter petitioned the WCAB for reconsideration. By Opinion and
Decision After Reconsideration dated May 22 , 2003 (the "May 22 , 2003 Opinion ), the WCAB
dismissed the Complaint on the ground that Appellants ' UCL claim was precluded by the
exclusive remedies provisions of division 4 of the Labor Code. Although the WCAB ruled that
the dismissal of the Complaint rendered moot the issue of class certification, the WCAB
nonetheless observed that consideration of class issues was premature since a motion for class
certification had not yet been filed. The WCAB rescinded the initial dismissal order, and gave
Applicants thirt days within which to file an amended pleading. Applicants unsuccessfully
petitioned the Court of Appeal , and then the California Supreme Court, for review.
On December 31 , 2003 , Applicants served their First Amended Complaint for
Restitution. That pleading made only three substantive changes to Applicants ' defective
Complaint: (i) rather than stating a single claim under the UCL , Applicants asserted two civil
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causes of action for conversion and imposition of a constructive trst; (ii) Applicants claimed
discretionary penalties pursuant to Labor Code section 5814;1 and (iii) Applicants recast their
remedies, seeking restitution, an accounting and imposition of a constructive trust.
On May 7 , 2004, Defendants filed a Joint Petition to Dismiss Applicants ' First
Amended Complaint on three independent grounds. First, Applicants improperly sought to import
civil causes of action for "conversion" and "imposition of a constrctive trust" into a WCAB
proceeding. Second, Applicants continued to seek certain relief beyond the exclusive remedies
defined in the Workers ' Compensation Act (Cal. Lab. Code 99 3201 , et seq.) (the "Act"). Third
the First Amended Complaint again improperly purported to assert a class action on behalf of
countless injured employees, each of whom already has an individual workers ' compensation
claim pending before the WCAB.
On April 4, 2005 , this Court ruled that Applicants
' "
causes of action for conversion
and for constructive trst be dismissed" with leave to amend "to state a cause of action not barred
by the exclusive remedy doctrine." (Orders on Petition for Dismissal at p. 1.) This Court found
that dismissal of the conversion count was required because such civil causes of action are barred
by the "exclusive remedy doctrine of Labor Code 9 3600. (Opinion on Decision at p. 1.
Rejecting Applicants ' argument that constrctive trust is an equitable remedy that may be
employed in a workers ' compensation claim , this Court held that:
Workers ' compensation courts are courts of limited jurisdiction.While equitable remedies are sometimes employed, they may beused only if they relate to recovery of one or more of the fourtraditional workers ' compensation remedies of permanent disabilityunder, temporary disability, vocational rehabilitation or medicaltreatment. Theoretically, they may also be applied if they relate toone of the five areas of special jurisdiction: appeal from a decisionand order of the Rehabilitation Unit, Labor Code 9 132a casesPetitions for Serious and Wilful Misconduct under Labor Code 94551 and 4552, credit applications under Labor Code 9 3681 andFindings under Government Code 9 21166. The Board also hasjurisdiction over penalties and interest under Labor Code 9 5814 andsanctions under Labor Code 9 5813. Since none of these
1 After Defendants petitioned for dismissal of the First Amended Complaint, Applicantsclaimed that the request for discretionary penalties under Section 5814 had been added by mistakeand voluntarily withdrew the request.
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prerequisites to jurisdiction are alleged, the complaint must be
dismissed.
(Opinion on Decision at pp. 1-
Pursuant to the reasoning" of the May 22 , 2003 Opinion, this Court deferred
ruling on whether Applicants can maintain a class action. Nonetheless, this Court observed that
the Court of Appeal's recent decision in Rea v. Workers , Compo Appeals Bd. , 127 Cal. App. 4th
625 (2005), called into question the viability of the "thirt-five year old case" relied upon by the
WCAB and by Applicants Addington v. Cavey, 35 Cal. Compo Cas. 39 (1970), as grounds Jor
deferral:
On the other hand, the recent Second District Court of Appeal caseof Rea V. WCAB (Milbauer) (2005) Cal. App. 4th -Cal.Rptr. -' 70 CCC at pp. 16 - 18 & 23-28 of the slip opinion)would seem to. suggest that the Board may not adopt ad hocprocedures to govern a situation. While it is only persuasive
authority on the issue of certifying a Class, it is recent case of
importance on a similar issue.
Applicants ' Second Amended Complaint
On April 22 , 2005 , Applicants filed a Second Amended Complaint for restitution
(the "Second Amended Complaint" or "SAC" The gravamen of the Second Amended
Complaint remains the allegation that Applicants and proposed class members pursued admitted
claims for workers ' compensation benefits 2 but did not receive all of the benefits , penalties and
interest to which they were entitled.
The Second Amended Complaint purports to be a representative action brought on
behalf of a class consisting of all:
California employees that have sustained an admitted compensablework related injury between January 1 , 1990 and the presentwhether represented by counselor not and who were not properlypaid workers ' compensation indemnity benefits including but notlimited to Total Temporary Disability (TTD), Permanent PartialDisability (PPD), Vocational Rehabilitation Maintenance Allowance(VRMA), interest or self-imposed penalties pursuant to and accordance with Labor Code sections 4650 , 139. 4642 and 5800.
2 Each Applicant "either currently has pending, or has had pending admitted industrialclaims for injury... for which indemnity benefits have been paid" and "has caused to be filed anApplication for Adjudication of Claim" with the WCAB. (SAC at 2 and 9.
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(SAC at ~~ 1 and 4.) Included within the proposed class are injured workers who pursued claims
at the WCAB while being represented by diferent counsel than the attorneys who have fied the
Second Amended Complaint in this proceeding. (SAC at ~~ 2 9 and 19.
The Second Amended Complaint seeks "to recover only those indemnity benefits
and/or remedies over which the WCAB maintains jurisdiction, to wit, the recovery of those
traditional indemnity benefits including Total Temporary Disability, Permanent Partial Disability,
Vocational Rehabilitation Maintenance Allowance, self-imposed penalties and interest." (SAC at
~ 1.) Applicants ask the WCAB for an "order of restitution" of benefits that allegedly should have
been, but were not, paid to them. However, Applicants simultaneously aver that by fiing the
Second Amended Complaint they "do not waive their individual rights to such redress in the
Workers ' Compensation Appeal Board forum." (SAC at ~ 22.) Thus , Applicants ask this Court
to award them via a class action, the very same workers ' compensation benefits which they
reserve "their individual rights" to seek in their previously fied claims for benefits.
III. ARGUMENT
The WCAB Currently Does Not Have The Authodty Or Rules And
Procedures Necessary To Hear Class Actions.
Applicants have asked the WCAB to do what it currently is not authorized or
equipped to do -- adjudicate a class action claim for benefits that allegedly were not paid, or not
paid timely, in their individual claims. The entire workers ' compensation statutory scheme is
based upon adjudication of individual claims brought by injured employees and their dependents.
The Legislature has never authorized one injured employee to bring a "representative" claim on
behalf of other injured employees , nor has the WCAB itself promulgated any rules or procedures
to govern class actions. For these reasons , the Court should decline to entertain Applicants ' class
action claim, and should instead dismiss the Second Amended Complaint with prejudice.
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The Leeislature Has Not Authorized the WCAB to Hear Class Actions
The WCAB "is a tribunal of limited jurisdiction, with no powers beyond those
conferred upon it by (Aricle 14) of the state Constitution and the provisions of... the Labor Code.
State Compo Ins. Fund V. Industrial Accident Com. , 20 Cal. 2d 264 266 (1942); see also Cal. Lab.
Code 9 111(a) (the WCAB "shall exercise all judicial powers vested in it under (the Labor) code
Because the Legislature has exercised the power conferred upon it by the California Constitution
Aricle XIV in providing for WCJ's and the Board, constitutional provisions governing the state
judicial system contained in Aricle VI have no application in the workers ' compensation system
and the jurisdictional provisions of the workers' compensation law are of 'limited scope.
American Psychometric Consultants, Inc. V. Workers ' Compo Appeals Bd. , 36 Cal. App. 4th 1626
1638 (1995), rehearing denied (1995), review denied (1995).
Under the jurisdictional provisions of the Labor Code, the WCAB has the authority
to hear proceedings "for the recovery of compensation, or any right or liability 'arising out of or
incidental thereto. . . , '" except as otherwise provided by division 4 of the Act. Cal. Lab. Code
9 5300; Greener v. Workers ' Compo Appeals Bd. , 6 Cal. 4th 1028 , 1038-39 (1993). However, that
grant of authority to the WCAB does not extend to class action claims for at least two reasons.
First, the Act does not contain any provision that refers to, or even hints at, class
actions. Instead, the entire statutory scheme contemplates individual actions by employees (and
their dependents) for each separate injury sustained by those employees. Labor Code section
3602(a) provides that " (w)here the conditions of compensation set forth in Section 3600 concur
the right to recover
. ..
compensation is , except as specifically provided in this section and
Section 3706 and 4558 , the sole and exclusive remedy of the employee or his or her dependents
against the employer
. . ..
Cal. Lab. Code 9 3602(a) (emphasis added). Labor Code section
3753 also speaks in terms of individual actions for compensation by injured employees and others
entitled to "compensation" under division 4:
The person entitled to compensation may, irrespective of anyinsurance or other contract, except as otherwise provided in thisdivision, recover such compensation directly from the employer. addition thereto he may enforce in his own name in the mannerprovided by this division, the liability of an insurer either by making
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the insurer a part to the original application or by fiing a separateapplication for any portion of such compensation.
Cal. Lab. Code 9 3753 (emphasis added).
Section 5303 further provides that " (t)here is but one cause of action for each
injury coming within the provisions of (division 4)." Cal. Lab. Code 95303 (emphasis added);
see also Cal. Lab. Code 9 3208.2 (" (A)ll questions of fact and law shall be separately determined
with respect to each injur" suffered by an employee), and 10 Cal. Code of Regs. 9 10401 ("
separate Application for Adjudication shall be filed for each separate injur for which benefits are
claimed even though the employer is the same in each case. "
Read together, these provisions clearly establish that the only claim allowed at the
WCAB is an individual claim for compensation benefits brought by the injured worker or his or
her dependents. Graczvk v. Workers ' Compo Appeals Bd. , 184 Cal. App. 3d 997 , 1003 (1986).
Once the injured employee fies a claim, the Labor Code allows the joinder of all
parties with an interest in that claim.3 But it does not authorize representative actions by one
injured worker on behalf of another. For example , Labor Code section 5303 provides , in part, that
(a)ll claims brought for medical expense, disability payments, death benefits , burial expense
liens , or any other matter arising out of such injury may, in the discretion of the appeals board, be
joined in the same proceeding at any time." Cal. Lab. Code 9 5303. Likewise, Section 5307.5(b)
authorizes the WCAB to " (p )rovide for the joinder in the same proceeding of all persons interested
therein, whether as employer, insurer, employee, dependent, creditor, or otherwise. Cal. Lab.
Code 95307.5(b). Pursuant to those provisions, the WCAB has promulgated its own rule
requiring that " (a)ll claims of all persons arising out of the same injury to the same employee shall
be fied in the same proceeding. " 10 Cal. Code of Regs. 9 10401 (emphasis added).
3 For example , medical providers and other third parties who provide goods or services toan injured worker are considered "parties in interest" and have the right to seek payment from theemployer by filing a " lien claim" against any compensation due to the injured employee. Cal.Lab. Code 94903; Charles J. Vacanti, M.D., Inc. V. State Compo Ins. Fund 24 Cal. 4th 800 , 811(2000).
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By requiring that all interested parties be joined in the same proceeding, these
joinder rules negate any authorization to hear class actions. The courts have long recognized that
class actions constitute an exception to the general rule of compulsory joinder of all interested
parties. See Bernard v. Wall, 184 Cal. 612, 629 (1921) (" (P)rior to the enactment of (Code of
Civil Procedure (" e.P") section 382 , which authorizes the Superior Court to hear class actions),
general rules of compulsory joinder prohibited a part from representing interested parties who
had not joined in the action
);
Weaver v. Pasadena Tournament of Roses Assn. , 32 Cal. 2d 833
837 (1948) (holding that C. P. section 382 "is based upon the doctrine of virtal representation
and is an exception to the general rule of compulsory joinder ). The Labor Code does not
however, include any such exception to its joinder rules for class or representative actions.
Indeed, the only "representative" action permitted at the WCAB is an action by "
trustee or guardian ad litem" appointed "to appear for and represent any minor or incompetent
upon the terms and conditions which (the WCAB) deems proper. Cal. Lab. Code 95307.5(a).
The Labor Code does not authorize any other type of representative action.
The second reason why the WCAB is not authorized to hear class actions is that the
Legislature has never incorporated into the Labor Code the civil class action provisions of C.
section 382 or the California Rules of Court.6 The Labor Code is replete with provisions that
incorporate other sections of the C. e.P. See , Cal. Lab. Code 99 5308 (incorporating C.e.P.
section 1280 and vesting the WCAB with jurisdiction over arbitrations of insurance controversies
4 The WCAB does have a procedural mechanism for deciding common issues of fact or
law affecting different applicants , but it is not by way of a representative action. Instead, in 1991the WCAB promulgated rules for consolidation of separate, but related, workers ' compensationclaims for the purpose of receiving evidence and adjudicating common issues. lOCal. Code ofRegs. 99 10590, 10591. However, the consolidation procedure in no way impacts the applicantsunderlying individual claims, which continue to exist during the consolidation and proceedseparately once the common issues are determined. The consolidation regulations also do notallow one injured worker to represent the interests of any other injured worker.
5 e.C.P section 382 provides , in relevant part, that "when the question is one of a commonor general interest, of many persons , or when the parties are numerous , and it is impracticable tobring them all before the court, one or more may sue or defend for the benefit of all. Cal. Civ.
Proc. Code 9 382.6 Rules 1850-
1861 of the California Rules of Court set forth the case managementprocedures for class actions filed in the Superior Courts.
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involving self-insured persons); Cal. Lab. Code 95311 (authorizing any par to object to aparticular WCJ on the same grounds specified in C.e.P. section 641); Cal. Lab. Code 95316
(providing that service of documents in proceedings before the WCAB may be accomplished in
the manner provided in the C. ); Cal. Lab. Code 9 5601 (incorporating the provisions ofC.e.P.
section 481.010 for attachment proceedings at the WCAB); Cal. Lab. Code 95710 (allowing the
deposition of a witness to be taken in the manner proscribed by laws for the taking of depositions
in civil actions under C. P. section 2016 et seq.
incorporate, or even mention, C.e.P. section 382.
However, the Labor Code does not
The Labor Code s incorporation of certain other provisions of the C. P. indicates
that the Legislature knows how to incorporate such provisions when it wants to. Thus, the
Legislature failure to incorporate C. P. section 382 into the Labor Code must have been
intentional. Cf. Ogden v. WCAB , 11 Cal. 3d 192 , 198 (1974) (interpreting Labor Code section
4903 , the court holds that " (u)nder the well-known rule of statutory interpretation expressio unius
est exclusio alterius in view of the inclusion by the Legislature of specific provisions applicable
to unemployment benefit liens, the Legislature s failure to enact similar provisions for other liens
seems intentional"). Labor Code section 5708 makes this point explicit:
All hearings and investigations before the appeals board or aworkers ' compensation judge are governed by the (division 4) andby the rules of practice and procedures adopted by the appealsboard. In the conduct thereof they shall not be bound by thecommon law or statutory rules of evidence and procedure.
. . .
Cal. Lab. Code 9 5708 (emphasis added).
The inescapable conclusion to be drawn from these authorities is that the
Legislature did not intend to authorize class actions at the WCAB. Indeed, the California Supreme
Court has often admonished that "an administrative agency cannot create a remedy the Legislature
has withheld. Currie v. Workers ' Compo Appeals Bd. , 24 Cal. 4th 1109 , 1117 (2001), citing
Dyna-Med, Inc. V. Fair Emplyment & Housing Com. , 43 Cal. 3d 1379 , 1387 (1987). For example
7 The Labor Code also does not incorporate Rule 23 of the Federal Rules of CivilProcedure , which the WCAB cited in its prior opinion in this case as authority to guide the Courtin ruling on a motion for class certification. (See May 22 , 2003 Opinion at p. II).
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in Dyna-Med, the California Supreme Court concluded that the Fair Employment and Housing
Commission ("FEHC") did not have the authority to award punitive damages, even though the
Legislature delegated broad authority to the FEHC to fashion appropriate remedies for
discriminatory employment practices under the Fair Employment and Housing Act. As the
Supreme Court explained:
(T)he Legislature s objective in providing for an administrativerather than a judicial resolution of discrimination complaints was toprovide a 'speedy and informal' process unburdened by 'proceduraltecl1icalities. ' (Cite omitted).. ..The award of punitive damages -traditionally.. . limited to the judicial forum with its more extensiveprocedural protection ... -- has no place in this scheme... .. We are ofthe view that the statutory language, given its ordinary import andconstrued in context of the purposes and objectives of the lawtogether with the Legislature s silence on the issue of punitivedamages , compels the conclusion that the Legislature did not intendto grant the (FEHC) authority to award punitive damages.
Dyna-Med, 43 Cal. 3d at 1393.
The same is true here. There are compelling practical and public policy reasons
why the Legislature did not authorize class actions at the WCAB. The class action mechanism
involving as it would here, tens of thousands of putative class members (SAC at ~3), as well as
lengthy and complex class certification proceedings , is antithetical to the speedy and infonnal
resolution of claims , which is the hallmark of proceedings before the WCAB. See , Cal. Const.
Art. 14 , 9 4 (the administration of workers ' compensation disputes shall be done " expeditiously,
inexpensively, and without incumbrance of any character
);
Beaida v. Workers ' Compo Appeals
Bd. , 263 Cal. App. 2d 204 209 (1968) (holding that although the WCAB functions as a court, its
proceedings are intended to be simple , informal and speedy). In addition, without the "extensive
procedural protections" afforded to class action litigants in the civil courts, the WCAB'
adjudication of class actions may well raise due process concerns. See Rose v. City of Havward
126 Cal. App. 3d 926, 936 (1981) (Court holding that class actions are not authorized by the
Administrative Procedures Act, in part, because the administrative hearing process lacks rules and
procedures that "are constitutionally required as a matter of due process.. 00
Nonetheless , in Addington v. Cavey, 35 Cal. Compo Cas. 39 42 (1970), the WCAB
concluded that it could "entertain() litigation in the nature of a class suit, similar to that authorized
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by California Code of Civil Procedure section 382. Defendants respectfully submit that the
WCAB erred in Addington for at least two principal reasons.
First, as explained above, the Labor Code does not incorporate e.C.P. section 382
or otherwise authorize class actions at the WCAB.
Second, the only legal authorities relied upon by the WCAB in Addington - Labor
Code section 5300 and the decision in Hartford Accident & Indem. Co. v. Industrial Accident
Com. , 216 Cal. 40 (1932) ("Hartford ) - do not support the conclusion reached in Addington
While Labor Code section 5300 confers on the WCAB the authority to hear all proceedings
concerning any right or liability arising out of or incidental" to the recovery of compensation, that
provision does not explicitly or implicitly authorize class actions. Instead, Section 5300 must be
read in conjunction with the other Labor Code provisions cited above 8 which make it clear that
proceedings "for the recovery of compensation" are individual claims instituted by an injured
worker or his or her dependents under division 4 of the Act, and not representative class action
claims.
Hartford also does not support the holding in Addington , since it did not involve a
class action at all. Instead Hartford dealt with an order by the WCAB requiring Hartford to pay
17 final awards previously obtained by fort injured workers in proceedings filed against their self-
insured employer, Pick ring Lumber Company ("Pickering
).
Hartford 216 Cal. at 43. Those
applicants then joined together in an action at the WCAB to enforce their awards against Hartford
which had issued a surety bond to Pickering. . at 44. The court in Hartford had no occasion to
rule , or even to comment upon, the WCAB' s authority to entertain class actions.
In sum, the WCAB does not have the express or implied authority to hear the
Hablian Applicants ' class action claim for benefits allegedly owed to tens of thousands of injured
workers who are not joined as parties to this action. Applicants ' claim should , therefore, be
dismissed in its entirety.
8 "The words of (a) statute must be constred in context, keeping in mind the statutorypurpose , and statutes or statutory sections relating to the same subject matter must be harmonizedboth internally and with each other, to the extent possible. Dyna-Med , 43 Cal. 3d at 1387.
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Even if the WCAB Had the Authority to Hear Class Actions. It Lacks
the ReQuisite Rules and Procedures to Do So
Even if the WCAB did have the authority to hear class actions (which it clearly
does not), it could not do so unless and until the "cour administrator" adopts appropriate rules of
practice and procedure pursuant to Labor Code section 5307( c) and the AP A. Hilton Hotels Corp.
v. Workers ' Compo Appeals Bd. , 60 Cal. Compo Cas. 1112 (1995), writ denied (1995); Masco
Building Products, Inc. V. Workers ' Compo Appeals Bd. , 60 Cal. Compo Cas. 348 (1995), writ
denied (1995), review denied (1995); Moran V. Bradford Building, Inc. , 57 Cal. Compo Cas. 273
(1992).
In Moran, the WCAB considered whether it had the authority to dismiss an
applicant' s claim for failure to prosecute or to cooperate with discovery. Moran, 57 Cal. Compo
Cas. at 274. The WCAB held that, while it had "both inherent and statutory authority to provide
for dismissal" of claims
, "
until such a time that rules of practice and procedure on dismissal of
claim forms are adopted by the Appeals Board, such dismissal is neither authorized nor
appropriate. . at275 , 282-83. The WCAB further held that dismissal for failure to cooperate
with discovery was not appropriate, because, while such dismissal was authorized by the e.C.
the Labor Code did not incorporate those e.C. P. provisions. . at 286. Ifthe WCAB intended to
provide for the dismissal of a claim for failure to prosecute or cooperate with discovery, "the
specific adoption of these procedures should be by the Appeals Board's rules of practice and
procedure " as set forth in Labor Code section 5307 and the AP A.
Similarly, in Hilton Hotels and Masco Building Products, the WCAB followed
Moran in holding that, absent the enactment of rules and procedures allowing for the imposition of
monetary and other discovery sanctions , the WCAB lacked the authority to impose such sanctions.
The WCAB in Moran refused to allow the dismissal of claims without appropriate rule-making, even though Labor Code section 133 provides that the "appeals board shall have powerand jurisdiction to do all things necessary or convenient in the exercise of any power orjurisdiction conferred upon it" under the Labor Code. As the WCAB explained
, "
(h)istorically,the Appeals Board has exercised th(is) power and authority...by the adoption of rules of practiceand procedure. Moran, 57 Cal. Compo Cas. at 280. Likewise , Section 133 provides no basis forthe WCAB to entertain class actions absent properly adopted rules of practice and procedure.
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Hilton Hotels , 60 Cal. Compo Cas. at 1114; Masco Building Products , 60 Cal. Compo Cas. at 350.
More recently, the Court of Appeal for the Second Appellate District strck down
rules announced by the WCAB in a case involving the Uninsured Employers Fund ("UEF"
because the WCAB did not follow the rule-making procedures required by Section 5307 and the
APA. Rea V. Workers ' Compo Appeals Bd. , 127 Cal. App. 4th 625 , 644-45 (2005). In Rea, the
WCAB reconsidered en banc a WCJ's decision concerning the identity of an applicant' s uninsured
employer and an award of benefits based thereon. . at 625-26. The WCAB affrmed the award
against the uninsured employer, and in the process, announced procedures to be applied in future
cases involving the UEF, including the requirement that the UEF appear at priority conferences
under Section 5502 and assist with the discovery of the proper employer. . at 629-30. Citing
Tidewater Marine Western, Inc. v. Bradshaw, 14 Cal. 4th 557 , 569-72 (1996), 10 the Rea court
found that the rules announced by the WCAB were intended to "govern its procedure" and apply
generally to other cases. As a result, the Court of Appeal held that, in adopting those rules without
complying with Section 5307 and the APA, the WCAB had "overstepped its authority. . at
625 647-48.
The decisions in Rea Moran Hilton Hotels and Masco Building Products all
compel the same result here - the WCAB cannot entertain Applicants ' class action claim unless
and until the Legislature authorizes the WCAB to hear class actions and the court administrator
adopts appropriate rules of practice and procedure for class actions pursuant to Section 5307(
and the AP A. If Applicants ' purported class action were allowed to proceed , this Court and/or the
WCAB would have no choice but to adopt on an ad hoc basis rules and procedures to govern the
adjudication of Applicant's class action claim, including class certification. In fact, the WCAB has
already suggested that this Court should follow FRCP 23 , while this Court has indicated that the
decision in Addington wil control (which decision cites C.e.P section 382). (See April 4 , 2005
Opinion on Decision, pp. 2-3). No matter what rules this Court or the WCAB ultimately purports
10 In Tidewater Marine Western, Inc. V. Bradshaw, 14 Cal. 4th at 568- , the CaliforniaSupreme Court held that a written enforcement policy promulgated by the Division of LaborStandards Enforcement was void because the Division had failed to follow the AP
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DEFENDANTS' JOINT PETITION TO DISMISS APPLICANTS' SECOND AMENDED COMPLAINT
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to adopt in this case, those rules would run afoul of Section 5307 and the AP
Section 5307(c) provides that n(t)he court administrator shall adopt reasonable
proper, and uniform rules for distrct offce procedure regarding trial level proceedings of the
workers ' compensation appeals board. " CaL Lab. Code 9 5307( c). That statute also mandates that
(a)ll rules and regulations adopted by the court administrator pursuant to this subdivision shall
subject to the requirements of the rulemaking provisions of the Administrative Procedure Act.
CaL Lab. Code 9 5307( c) (emphasis added). Under the AP A, the court administrator must provide
notice of any proposed regulations, hold public hearings, and then publish final regulations with
the Secretary of State and Office of Administrative Law. CaL Lab. Code 99 5307(b) and 5307.4;
Cal. Gov. Code 99 11343, 11344, 11346.4(b), 11346.8. Rules and procedures adopted without
compliance with the requirements of Section 5307 and the AP A are considered "underground
regulations " and are per se invalid. Rea, 127 Cal. App. 4th at 644-47; Tidewater Marine, 14 CaL
4th at 569- 72; see also Moran, 57 CaL Compo Cas. at 282 (recognizing that " (p )ublic hearings
attendant to the rule making process assure that the impact of such procedures on the workers
compensation adjudications system are fully considered in both fashioning an appropriate rule or
rules and determining their scope
The message of these authorities is clear: Before the WCAB can hear any class
action, the court administrator must announce proposed class action rules , allow public comment
and hearings , and then adopt those rules in accordance with the AP A. Any "underground" rules
adopted or employed by the WCJ or WCAB to adjudicate Applicants ' class action claim here
would be per se invalid under the reasoning of Rea Moran and the other authorities cited above.
Unless and until the Legislature authorizes the WCAB to hear class actions and the
court administrator adopts proper rules governing class action proceedings under Section 5307(
and the AP A, 11 Applicants ' class action complaint must be dismissed.
11 Legislative authorization for class actions at the WCAB is a necessary pre-requisite toany rulemaking efforts by the court administrator, since " (a)dministrative regulations that alter oramend (a) statute or enlarge.. .its scope are void.... Dyna-Med 43 Cal.3d at 1389 citing Morrisv. Williams 67 CaL 2d 733 , 748 (1967).
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The Second Amended Complaint Violates Labor Code Section 5303 And The
Rule Against Splitting A Cause of Action
As discussed above, Labor Code section 5303 provides that "(t)here is but one
cause of action for each injury coming within the provisions of (division 4)." When read together
with the exclusive remedy provisions of Labor Code sections 3600 and 3602, Section 5303
establishes that the only cause of action allowed at the WCAB is a claim for compensation
benefits under division 4. Graczyk, 184 Cal. App. 3d 997 at 1003.
Section 5303' s requirement that an applicant assert in a single cause of action all of
his or her claims for benefits arising out of an injury is the workers ' compensation version of the
common law rule against "splitting a cause of action" applied in civil courts. Like the common
law rule, Section 5303 serves to prevent applicants from bringing multiple applications for
compensation that arise out of the same injury, and thereby avoid the waste of judicial resources
and expense that such multiple actions would cause. Glavitch v. Industrial Accident Coru , 44
Cal. App. 2d 517 523 (1944), disapproved on other grounds in Cross v. Pacific, Gas & Electric
, 60 Cal. 2d 690 , 694 (1964) ("Section 5303 is intended to prevent the splitting of causes of
action necessarily involved in the same transaction, to save the obligor the costs and vexation of
different suits
Applicants brazenly violate Section 5303 by asking this Court to award them and
proposed class members "traditional indemnity benefits" that purportedly should have been paid
in their individual claims, while simultaneously asserting that they and the proposed class
members do not waive their individual rights to such redress in the Workers ' Compensation
Appeals Board forum. (SAC at 22.) (Emphasis added. Clearly, the Second Amended
Complaint attempts to do what is expressly prohibited by Section 5303 and the rule against
splitting a cause of action -- have two bites at the same apple.
12 Section 5303 and the rule against splitting a cause of action are supported by policyconsiderations similar to those cited in Addington v. Cavey supra, 35 Cal. Compo Cases 39.Allowing multiple actions to be asserted based upon a common set of facts necessarily wouldcreate a risk of inconsistent findings and results , and have a "disruptive effect" on existingattorney-client relationships between the thousands of applicant-members-of-the-classes and their
attorneys of record in each of the many thousands of cases. Id. at 45.
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5477/9841-007LAWORD/69840v8
Indeed, for at least some Applicants , the Second Amended Complaint represents
their "second bite" as they already have settled by compromise and release the very same claims
for indemnity benefits, penalties and interest that they seek to litigate here. By way of example
only, attached and marked as Exhibit 1 is a tre and correct copy of the June 1 , 1999 Opinion and
Order Approving Compromise and Release in the individual claim of one named Applicant
Timothy Taylor, against his employer and defendant Zenith Insurance Company. In paragraph
lO(i) of the Compromise and Release, Mr. Taylor, represented by one of the same counsel who
represents Applicants in this proceeding, expressly waived and released" all issues pertaining to
, TD , retro TD , future medical , mileage and penalties & interest with regard to all of the above
class of benefits." Having already litigated, settled and released all claims for benefits arising
from his purported injur, Mr. Taylor may not seek to recover more money via a class action.
Section 5303 prohibits Applicants from bringing individual claims for
compensation benefits , and then pursuing a second claim to recover benefits that Applicants
contend should have been, but were not, paid in the original claim. Similarly, Section 5303 bars
Applicants from bringing a second action to recover penalties and interest for purported
underpayment of benefits in their original claims. Accordingly, Applicants ' Second Amended
Complaint should be dismissed in its entirety and with prejudice.
Applicants ' Restitution Claim Is Neither Needed Nor Proper Since The Labor
Code Provides Applicants ' Exclusive Remedies
In their Second Amended Complaint, Applicants again seek to augment the express
remedies provided by division 4 with equitable remedies. This they may not legally do. The
remedies provided in division 4 of the Labor Code remain Applicants exclusive relief and bar the
equitable remedy of "restitution.
Throughout this litigation, Applicants have argued that, even if they do seek
remedies beyond those expressly set forth in division 4, the workers ' compensation system
13 Zenith and each of the other defendants reserves the right to seek dismissal of the
Second Amended Complaint, by individual petition to dismiss or other vehicle, based upon theexecution of a compromise and release in the applicant's individual claim.
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DEFENDANTS' JOINT PETITION TO DISMISS APPLICANTS' SECOND AMENDED COMPLAINT
54 7779841-007
LAWORD/69840v8
nonetheless provides equitable authority suffcient to craft such relief. In so arguing, Applicants
fail to recognize that equity may not extend the scope of relief already expressly provided by the
Labor Code. Nor may Applicants invoke the WCAB' s equitable powers to circumvent the Labor
Code s exclusive remedy provisions. Hughes v. Argonaut Insurance Company, 88 Cal. App. 4th
517 , 531 (2001) (there is no "equitable claim" exception to the exclusive remedy doctrine).
The Labor Code expressly "limit( s) the remedies available for injuries covered by
the (Act). Vacanti v. State Compensation Ins. Fund, 24 Cal. 4th at 811. Labor Code section
3600 provides that an employer s liability for compensation benefits is in lieu of any other
liabilty whatsoever to any person except as otherwise specifically provided in (Labor Code)
sections 3602 , 3706 , and 4558.,,15 "Compensation" includes "every benefit or payment conferred
by (division 4 of the Labor Code) upon an injured employee" -- and nothing more. Cal. Lab. Code
9 3207. "Together, these provisions establish that the liability of employers and insurers for
industrial injury which results in occupational disability or death' is limited to workers
compensation remedies. Vacanti, 24 Cal. 4th at 813 (quotation marks and citation omitted and
emphasis added).
The Labor Code defines the types of benefits available to employees for workplace
InJunes. It also defines the exclusive remedies for any alleged failure to pay such benefis. For
example , Labor Code section 4650 requires a ten percent penalty on any temporary or permanent
disability benefit payment that is late, regardless of the reason for delay. Similar penalties are
available for a delay or refusal to provide, or pay for, vocational rehabilitation benefits. Cal. Lab.
Code 99 139.5 and 4642. These statutes define the exclusive remedies available for Defendants
14 Division 4 reflects the Legislature s provision of comprehensive benefits and remediesto California s injured workers. It is inappropriate for the WCAB to substitute its judgment as tothe appropriate remedies for the alleged harm where the Legislature has already analyzedappropriate remedies and voted to put specific remedies into the Labor Code.
See Gold v.Los Angeles Democratic League , 49 Cal. App. 3d 365 , 373 (1975) (court may not substitute itsown judgment as to remedy where statute created by Legislature provides remedy for breach ofobligation).
15 The Legislature extended the exclusive remedy provisions to include insurers bydefining "employer" as including "insurer. " Vacanti , 24 Cal. 4th at 813.
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alleged failure properly to administer workers ' compensation claims. Applicants cannot seek the
equitable remedy of restitution in addition to or as an alternative to those statutory remedies.
Applicants may argue that they are entitled to restitution here because the WCAB
has acknowledged that it has the power to grant equitable relief. Simply because restitution may,
in certain specified circumstances, be within the WCAB' s authority, however, does not mean that
it can be applied as a remedy in every instance. Indeed, under California law, the WCAB cannot
provide restitution where there are other available statutory remedies. Ramona Manor
Convalescent Hospital v. Care Enterprises , 177 Cal. App. 3d 1120, 1140 (1986) (Holding that
restitution is not available where there is an adequate remedy at law. See also Taliaferro v.
Taliaferro , 144 Cal. App. 2d 109, 113 (1956); and 11 Witkin Summary ofCal. Law (9th ed. 2004)
Equity, 9 3.
As the WCAB recognized, there are instances where the WCAB has "exercised its
equitable powers to order restitution under specifed circumstances. (May 22 , 2003 Opinion at
9: 5 (emphasis added).) In each of the "specified circumstances" cited by the WCAB , the parties
seeking restitution would have had no other remedy if the WCAB had not provided restitution.
(Id. at 9:5- 8 (citing Bell v. Industrial Accident Com., 18 Cal. Compo Cas. 243 (1953) (ordering
restitution to carrier who overpaid benefits due to clerical error by the Permanent Disability Rating
Bureau); Hargrove V. Permanente Metals Corp , 16 Cal. Compo Cas. 30 (1949) (ordering
restitution to carrier, where claimant had lied about her inability to work); Robles v. Workers
Compo Appeals Bd , 60 Cal. Compo Cas. 536 (1995) (ordering restitution to carrer where claimant
had concealed medical records demonstrating a non-industrial history and treatment prior to the
time of claimed history
);
House V. Workers ' Compo Appeals Bd , 58 Cal. Compo Cas. 354 (1993),
writ denied (1995), review denied (1995) (insurance carrier that furnished benefits because of
24. applicant's misrepresentation as to cause of injury was entitled to restitution).
Common to each of these cases is the lack of any statutory remedy to correct the
carrier s overpayment. 16 In other words, unless the WCAB exercised its equitable powers, the
16 These cases do not address the separate issue of whether the Act' s exclusive remedyprovisions apply, or do not apply, to insurer claims. That issue is likewise not presented here.
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insurers would have had no means by which to recover benefits incorrectly paid: They would
have been left without a remedy. Here, on the other hand, the Labor Code provisions that
Applicants cite expressly define the remedies avail ble for Defendants ' alleged misconduct. To
seek equitable remedies in addition, or as an alternative, to such express statutory relief is directly
contrary to well-established California law governing the application of equitable remedies and the
exclusive remedy provisions of the Labor Code. 17 See American Psychometric Consultants , 36
Cal. App. 4th at 1645 (entertaining claims for restitution in cases where statutory remedies "do not
apply
Finally, Applicants may also argue that the WCAB's decision created a general
rightto restitution here. To the contrary, in discussing the allegations asserted by Applicants in a
prior pleading, the WCAB merely observed that restitution might be appropriate in a very specific
circumstance, after an uncontested or adjudicated audit determination by the Division of Workers
Compensation ("DWC") under Labor Code section 129. Not only do Applicants fail to allege any
known uncontested or adjudicated DWC audit determination, they also fail to allege that the DWC
audited their specific workers ' compensation claims and made an individual determination that
compensation is owed under Section 129(c). 18 As explained by the WCAB , without such a
determination, there could be no "property right" which arguably might give rise to "restitution
and, instead
, "
each case must be decided on its own merits regarding entitlement to temporary and
permanent disability alleged due and owing. " (May 22 2003 Opinion at 10:24-27.
Applicants ' demand for " restitution" is nothing more than a device by which they
seek to obtain remedies that, under specific provisions of the Labor Code, already are available to
any eligible proposed class member in his or her individual claim. Regardless of whether it may
17 Indeed, our research yielded no reported authority where an insurer was required to payrestitution to an applicant as a result of an order from the WCAB. This is not surprising given thebroad remedies found in Division 4.
18 In the May 22, 2003 Opinion, the WCAB determined that Labor Code section 129empowers the WCAB to order "restitution." However footnote 10 made clear that there is no rightto benefits or penalties where the DWC has not made a prior undisputed determination that suchbenefits or penalties are owed pursuant to an audit conducted under Labor Code section 129.There is nothing in Section 129 that empowers Applicants to seek restitution in a representativecapacity or to seek benefits absent an uncontested audit detennination by the DWe.
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DEFENDANTS' JOINT PETITION TO DISMISS APPLICANTS' SECOND AMENDED COMPLAINT
have jursdiction to do so, the WCAB may not grant restitution where express division 4 remedies
already exist. As a result, Applicants ' request for restitution should be strcken from the Second
Amended Complaint.
IV. CONCLUSION
For all of the foregoing reasons, Defendants respectfully request that the Court
dismiss Applicants ' Second Amended Complaint with prejudice.
Dated: June 9, 2005 SHEPPAR, MULIN, R1CHTER & HAPTON LLP
SATIONINSURNCE FUN
Dated: June 9, 2005
Dated: June 9 , 2005
Dated: June 9 , 2005
STATE COMPENSATION INSURNCE FUN
BETTY R. QUARLESAttorneys for Defendant STATE COMPENSATIONINSURNCE FUN
PROSKAUER ROSE LLP
LARY ALAN RAPPAPORTAttorneys for Defendant ZENITH INSURCECOMPANY
SONNENSCHEIN NA TH & ROSENTHAL LLP
PAUL E.B. GLADAttorneys for Defendant FIREMAN' S FUNDINSURNCE COMPANY
'54 77179841-QC 7
LA WORD/69840v8
- 20-DEFENDANTS' JOINT PETITION TO DISMISS APPLICANTS' SECOND AMENDED COMPLAINT
have jurisdiction to do so, the WCAB may not grant restitution where express division 4 remedies
already exist. As a result, Applicants' request for restitution should be stricken from the Second
Amended Complaint.
IV. CONCLUSION
For all of the foregoing reasons , Defendants respectfully request that the Cour
dismiss Applicants ' Second Amended Complaint with prejudice.
Dated: June 9 , 2005
Dated: June 9, 2005
Dated: June 9, 2005
Dated: June 9, 2005
SHEPPAR, MULLIN, RICHTER & HAPTON LLP
FRANK FALZETTAAttorneys for Defendant STATE COMPENSATIONINSURANCE FUN
STATE COMPENSA nON INSURCE FUN
/) . / . . ..
BETT R. QUARAttorneys for Defendant STATE COMPENSATIONINSURNCE FUN
SONNENSCHII
::rL E.B. GL
Attorneys for Defendant FIREMAN' S FUNINSURNCE COMPANY
54 7719841-C 7LlIWORD/69840vB
- 20-DEFENDANTS' JOINT PETITION TO DISMISS APPLICANTS' SECOND AMNDED COMPLAINT
Dated: June 9 2005
Dated: June 9, 2005
12 OTHR DEFENSE COUNSEL
13 Donald P. Tobin, Esq.Edwin J. Lucks, Esq.
14 TOBIN LUCKS, LLP21300 Victory Blvd. , 3rd Floor15 Woodland Hils, CA 91367Telephone: (818) 226-340016 Facsimile: (818) 226-3401
17 e. Duke Mash, Esq.LAW OFFICES OF ROBERT
18 WHATLEY550 No. Golden Circle Drive
19 Santa Ana, CA 92705Telephone: (714) 560-019920 Facsimile: (714) 560-0188
2 I Laurence 1. Hutt, Esq.Amy B. Levin, Esq.
22 AROLD & PORTER LLP777 South Figueroa Street, 44th Floor23 Los Angeles, CA 90017Telephone: (213) 243-4100
24 Facsimile: (213) 243-4199
25 Jerilyn Cohen, Esq.LAUGHLIN, FALBO, LEVY
26 & MORESI, LLP200 South Los Robles Ave. , Suite 50027 Pasadena, CA 91101Telephone: (626) 568-970028 Facsimile: (626) 568-3906
AK, GUM, STRAUSS, HAUER & FELD, LLP
Attorneys for efendants LIBE UALINSURCE COMPAN, LIBERTY MUAL FIREINSURCE COMPAN, LIBERTY MUUALINSURCE GROUP, and HELMSMAMAAGEMENT SERVICES, INC.
MIAM & LARSEN LLP
PAUL A. LARSENAttorneys for Defendant REPUBLIC INEMNITYCOMPAN OF CALIFORNA
PARTY REPRESENTING
Attorneys for DefendantsFARRS INSURCE EXCHAGEMI-CENTY INSURCE COMPANand FREMONT COMPENSATION INSURCECOMPAN
Attorneys for DefendantsNATIONAL UNON FIR INSURCECOMPAN, INSURCE COMPANOF THE STATE OF PENNSYLVANIAAMRICAN HOME ASSURCE andAIG CLAIS SERVICES, INe.
Attorneys for DefendantsCONTThNTAL CASUALTY COMPANand RSKCO. CLAIMS SERVICES, INC.
Attorneys for DefendantRAPHS GROCERY COMPAN
547719841-007LAWORD/69840v8
- 21 -DEFENDANTS' JOINT PETITION TO DISMISS APPLICANTS' SECOND AMENDED COMPLAIT
. 05/1 /2005 09: 27 5255851885
Dated: June 9, 2005
Dated: June 9, 2005
12 OTHR DEFENSE COUNSEL
13 Donald P. Tobin, Esq.Edwin J. Lucks, Esq.
14 TOBIN LUCKS , LLP21300 Victory Blvd., 3rd Floor
15 Woodland Hils, CA 91367Telephone: (818) 226-3400
16 Facsioi1e: (818) 226-3401
17 C. Duke Marsh, Esq.LAW OFFICES OF ROBERT18 WHEATLEY550 No. Golden Circle Drive
19 Santa Ana, CA 92705Tdephone; (714) 560-0199
20 Facsimile: (714) 560-0188
21 Laurence J. Hutt, Esq.Amy B. Levin, Esq.
22 AROLD & PORTER LLP777 South Figueroa Street, 44th Floor
23 Los Angeles, CA 90017Telephone: (213) 243-4100
24 Facsimile: (213) 243-4199
25 Jerilyn Cohen, Esq.LAUGHLIN, FALBO, LEVY
26 & MORESI, LLP200 South Los Robles Ave. , Suite 50027 Pasad , CA 91101Telephone: (626) 568-970028 Facsimile: (626) 568-3906
MILAM AND LARSEN PAGE 02
AKIN, GUMP, STRAUSS , HAUER & FELO, LLP
JOHN A. KARACZYNSKIAttorneys for Defendants LIBERTY MUTUALINSURANCE COMPANY, LIBERTY MUTUAL FIREINSURNCE COMPANY, LIBERTY MUTUALINSURACE GROUP, and HELMSMANMAAGEMENT SERVICES , INC.
MILAM & LARSEN LLP
11t t--PAUL A. LARSEN
Attomt;ys fot Defendant REPUBLIC fNE:MNITYCOW ANY OF CALIFORNIA
PARTY REPRESENTING
Attorneys for DefendantsFARMERS INSURACE EXCHANGEMID-CENTURY INSURACE COWAN,and FREMONT COl'ENSATION INSURANCECOMPANY
Attorneys for DefendantsNATIONAL UNION FIRE INSURANCECOMPANY, INSURCE COMPANYOF THE STATE OF PENNSYL VANIA,AJ.RlCAN HOME ASSURANCE andAIG CLAIMS SERVICES , INC.
Attorneys for DefendantsCONTThNTAL CASUALTY CONWANYand RSKCO. CLAIMS SERVICES , INC.
Attorneys for DdendantRALPHS GROCERY COMPANY
5477/79841-007LAWORD/69840v8
- 21 -DEfENDANS' JOJN :fE'fTION TO DlSMJSS AfPLJCANS' SECOND AMENO.W COM.PMNT
Rebecca R. Weinreich, Esq.LEWIS BRISBOIS BISGAA& SMTIH LLP
221 North Figueroa StreetLos Angeles, CA 90012Telephone: (213) 250- 1800Facsimile: (213) 481-0621
James P. Diwik, Esq.Mar C. Richardson, Esq.SEDGWICK, DETERT, MORAN& AROLD LLP
One Embarcadero Center, 16th FloorSan Francisco , CA 94111-3628Telephone: (415) 781-7900Facsimile: (415) 781-2635
Rockard J. Delgadillo , Esq.City AttorneyValentine F. Dinu, Esq.Assistant City AttorneyRobert M. Unruh, Esq.Deputy City Attorney700 East Temple Street, Room 220Los Angeles , CA 90012Telephone: (213) 847-9822Facsimile: (213) 243-4199
Lloyd W. Pellman, Esq.County CounselPatrick A. Wu, Esq.Assistant County CounselJames 1. Castranova, Esq.Principal Deputy County CounselWorkers ' Compensation Division500 W. Temple Street, #648Los Angeles , CA 90012Telephone: (213) 974- 1919Facsimile: (213) 687-4745
David e. Capell , Esq.Elizabeth B. Vanalek, Esq.GORDON & REES275 Battery Street, Suite 2000San Francisco, CA 94111Telephone: (415) 986-5900Facsimile: (415) 986-8054
Craig S. Simon, Esq.Teresa R. Ponder, Esq.BURGER KAHN, a Law Corporation2 Park Plaza, Suite 650Irvine , CA 92614Telephone: (949) 474- 1880Facsimile: (949) 474-7265
Attorneys for DefendantsAMERICAN GUARNTEE LIABILITYINSURCE COMPANY, ZURCHAMERICAN INSURANCE CO. (assuccessor in interest to Zurich InsuranceCo. , U. S. Branch) and AMERICANZURICH INSURNCE COMPANY
Attorneys for DefendantCRAWFORD & COMPANY
Attorneys for DefendantCITY OF LOS ANGELES
Attorneys for DefendantCOUNTY OF LOS ANGELES
Attorneys for DefendantCONSTITUTION STATE SERVICE COMPANY
Attorneys for DefendantsTHE HARTFORD INSURANCE COMPANYCOMPANY and SPECIALTY RISK SERVICES
5477/9841-007LA WORD/69840v8
- 22 -DEFENDANTS' JOINT PETITION TO DISMISS APPLICANTS' SECOND AMENDED COMPLAINT
5477/9841-007LA WORD/69840v8
Jason B. Schlossberg, Esq.
SCHLOSSBERG & ASSOCIATES5200 W. Centu Blvd. , Suite 380Los Angeles, CA 90045Telephone: (310) 568-8460Facsimile: (310) 568-0274
Attorneys for DefendantKEENAN & ASSOCIATES
Steven M. Sion, Esq.Sun Y. Park, Esq.LAW OFFICES OF STEVEN M.
SION, INC.555 W. 5th Street, 31st FloorLos Angeles , CA 90013Telephone: (213) 996-8333Facsimile: (213) 996-8345
Attorneys for Defendant BROAD SPIRE LLCformerly Kemper Insurance Company
Steven H. Wax, Esq.PEARMAN BORSKA & WAX15910 Ventua Blvd. , 18th FloorEncino , CA 91436 .Telephone: (818) 501-4343Facsimile: (818) 386-5700
Attorneys for DefendantREPUBLIC INEMNITY COMPANYOF CALIFORNA
Robert A. Lewis , Esq.Christine Banks , Esq.BINGHAM McCUTCHEN, LLPThree Embarcadero CenterSan Francisco , CA 94111-4067Telephone: (415) 393-2000Facsimile: (415) 393-2286
Attorneys for DefendantSEDGWICK CLAIMS MANAGEMENTSERVICES , INC.
James R. Ross , Esq.ROSS & EAK
O. Box 7008Pasadena, CA 91109Telephone: (626) 356- 1700Facsimile: (626) 356- 1717
Attorneys for DefendantCYPRESS INSURNCE COMPANY
Virgil L. Roth, Esq. Attorneys for DefendantShannon M. Benbow, Esq. KAISER PERMANENTELAW OFFICES OF VIRGIL L. ROTH, P.625 Fair Oaks Avenue, Suite 255South Pasadena, California 91030Telephone: (626) 441- 1165Fax: (626) 441- 1166
Robert A. Lewis , Esq.Christine Hoverman, Esq.BINGHAM McCUTCHEN LLPThree Embarcadero CenterSan Francisco , California 94111-4067Telephone: (415) 393 2000Facsimile: (415) 393 2286
Attorneys for DefendantSEDGWICK CLAIMS MANAGEMENTSERVICES , INC. (FORMERLY KNOWNAS SEDGWICK JAMES)
- 23 -DEFENDANTS' JOINT PETITION TO DISMISS APPLICANTS' SECOND AMENDED COMPLAINT
547779841-007LA WORD/69840v8
Rex Altman, Esq.ALTMAN, HAMBLETON & LUNCHE16255 Ventura BoulevardSuite 1110Encino , California 91436Telephone: (818) 995-0080Facsimile: (818) 995-3419
Attorneys for DefendantAON/CAMBRIDGE INTEGRA TED SERVICES
- 24-DEFENDANTS' JOINT PETITION TO DISMISS APPLICANTS' SECOND AMENDED COMPLAINT
EXHIBIT 1
STATE OF CALIFORNIA
WORKERS' COMPENSATION APPEALS BOARD
Case No. lI,vo s(,Y 311I 'P1J.rl-l '1
Lvt"
Applicant, OPINION ANDOrder Approving
Compromise & Release
VS.
IPItTi,.
&,
l:.c", 171 Co .
In detenning the adequacy of the Agreement,The undersigned has considered and approved:
Defendants.
1. Applicant' s release of potential death benefits under the JOHNSON
and SUMNER cases;) 2. The release of rehabiltation benefits under the THOMAS case in light
of the good faith liability issue wh ch if decided adversely to applicant would defeatall bene as recited in the Compromise and Release Agreement:
( - J 3. The proposed settlement under the RODGERS case of any and allinjuries which might occur in the course of any rehabiltation program;
) In the absence of a THOMAS FINDING this Compromise and Releasedoes not settle rehabiltation benefits.
Liens and fees are allowed as set fort below, others have been paid.The parties to the above-entitled action having filed a Compromise and
Release herein on,
(,
II 17/settling this case for $ 1 OO() in addition to all
sums which may have been paid previously, and requesting that it be approved;and this Board having considered the entie record, including said Compromiseand Release, now finds that it should be approved.
IT IS ORDERED that said Compromise and Release be appraved. Award ismade in favor of the above-named applicant against the above-named defendant(s)payable as follows:
1) The following lien claims are to be deducted from the settlement: none2) Net to applicant before deduction of attorney s fees $
/ zu, () v':
3) (a) Less requested attorney s fees of.....................
...........
OGJ":
(b) Leaving a balance payable to applicant of......
::' ........
. o
less credit for permanent disability or settlement advances ade.
Dated:
THE BOAR REAIS JUDICTON OF AL LIENS OF RERD.
C(tl
WORKRS' COMPENSATION JUDGE
\) \ ~~~
A-tJ;- is/are hereby ord red to serve thisOrder on all p aimants fortwith and shall prepare and retan
STATE OF CALIFORNIA
DEPARTMENT OF INDUSTRIAL RELATIONS
DIVISION OF WORKERS' COMPENSATION
WORKERS' COMPENSATION APPEALS BCIAL SECURllY No5 -&
,-
-4 6
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/A A-z,8J A- Q'7"l.
:NT LOYEE) ADDRESS
rw :2lt9t 'ff,.,
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dv LR Go 5'. 'l iv-- )--trfLCORRECT NAME OF INSURANCE CARIER
DRESS /36:
1. The injured employee claims that while employedas a
c.. LQ C-'(OCCUPATION AT TIME OF INJURY)
on II / JC;5 at I.A by the employer
(OATE OF INJURY) . (CITY
( -
(STATE
(s)he sustained injury arising out of and in the course of employment to C-
r: 1: o-
2. The parties hereby agree to settle any and all claims on account of said injury by the payment of the sum of $ f3'
in addition to any sums heretofore paid by the employer or the insurer to the employee, less amounts set forth in Paragraph NO. 6.
COMPROMISE AND RELEASEPLEAE SEE INSTRUCTIONS ONREVERSE OF PAGE 2 BEFORE
COMPLETING FORM
CASE NO.rJ r: 36 4- 3
3. Upon approval of this compromise agreement by the Workers ' Compensation Appeals Board ora workers ' compensation judge and payment
in accordance with the provisions hereof, said employee releases and forever discharges said employer and insurance carrier from all
claims and causes of action, whether now known or ascertained, or which may hereafter arise or develop as a result of said injury,
including any and all liability of said employer and said insurance carrier and each of them to the dependents, heirs, executors
representatives, administrat6fs or assigns of said employee.
4. UnlesS otherwise expressly provided herein, approval of this agreement RELEAsES ANY AND ALL CLAIMS OF APPLICANT'S DEPENDENTS Te
DEATH BENEFITS RELATING TO INJURY OR INJURIES COVERED BY THIS COMPROMISE AGREEMENT. The parties have considered the
release of these benefits in arriving at the sum in Paragraph NO.
5. Unless otherwise expressly ordered by a workers' compensation judge , approval of this agreement DOES NOT RELEASE ANY CLAIM APPLI.
CANT MAY NOW OR HEREAFTER HAVE FOR REHABILITATION OR BENEFITS IN CONNECTION. WITH REHABILITATION.
6. The parties represent that the following facts are true: (If facts are disputed, state what each party contends under Paragraph 10.
Ii ' J.S
DATE OF BIRTH ACTUAL EANINGS AT TIME OF INJURYlA DAY OFF WORK DUE TO THIS INJURY
PAYMENTS MADE BY EMPLOYER OR INSURANCE CARRIERtf TEMPORAY DISABILITY INDEMNITY WEEKLY RATE PERIODS COVEREp
/' . .
iY '3Q) 3tn, I:2JB/
0/5 V( /c;i /17C uY\f-'f (-C
. PERMANENT DISABILITY INDEMNITY TOTAL MEDICA AND HOSPITAL BILLS C)
. --:
1' 1-) o J- Cfh ",lM
't C/ if 6 /
BENEFITS CLAIMED BY INJURED EMPLOYEEMEDICAL AND H9S 1TAL B LS PAID BY EMPLOYEE
THE FOJ.LO G AMOUN S ARE T9.BE DEDUCTED FROM THE SE:r ENT AMOUNT:
/; b- oJ /o /A'
/(//
'J/$ t.,hPAYABLE TO
PAYABLE TOPAYABLE TO
PAYABLE TOPAYABLE TO
LEAVING A BALANCE OF /r2/ less approved attorney fee (See Paragraph No. 9), payable to applicant. (If payment is t
be other than in a lump sum, or there is addi tional information , specify on separate page(s) .
) - /) ./
/3
CL PDIl!.
. ...- --.
fOil 9295082
7. liens not mentioned in ppragraph No.
IV
.. .
" be disposed of as follows:
8. For the purpose of determining the lien claim(s) filed for benefits paid pursuant to the Unemployment Insurance Code ortor benefits
furnished by lien claimants defined In Labor Code Sec. 490. 1, the parties propose reduction of the lien claim(s) In accorr;ance with
formulae attached.
9. Applicant's (employee s) attorney requests a fee of $ 18r()() . P' Amount of attorney fee previously paid, if any, $
10. Reason for compromise, special provisions regarding rehabiltation and death benefit claims, and additional information:
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11. It is agreed by all parties hereto that the fiing of this document is the filing of an application on behalf of the employee, and that the
WCAB may in its discretion set the matter for hearing as a regular application, reserving to the parties the right to put In issue any of
the facts dmitted herein, and that if hearing is held with this document used as an application the defendants shall have available to
them all d fenses that were available as of the date of filing of this document, and that the WCAB may thereafter either approve said
Comprom' e Agreement and Release or disapprove the same and issue Findings and Award after hearing has been held and the matter
reg tar submitted for decision.
Witn, 19 at Ve-
THE APPLICANT'S (EMPLOYEE' S) SIGNATURE MUST BE ATTESTED BY TWO DISINTERESTED
PERSONS OR ACKNOWLEDGED BEFORE A NOTARY PUBLIC,
C 1/7(DATE)
STATE OF CALIFORNIA
I\u(DATE)
' 1-7(DATE)
County of .
on this day of AD., 19 , before me
Notary Public in and for the said County and State, residing therein, duly commissioned and swrn, personally appeared
known to me to be the person whose name
subscribed to the within Instrment and acknowedged to me that executd the same.
IN wrNESS WHEREOF, I have hereunto set my hand and affxed my offcial seal the day and year in this Certicate first abovewritten.
CASE NAME:WCAB NO.
ADDENDUM "
REASON FOR COMPROMISE
10. There is a bonafide dispute as to the nature, extent and duration oftemporardisabilty and permanent disabilty, eargs , apportionment, liability for self-
procured medical treatment, need for continuing and/or fuher medical treatment
and medical-legal costs.
The parie this agreement, intend to s Ie and forever discharg y and all
aims the app . t may have for industral 1 . or injures hereinw in the
em ee of defendant er and durng the c ra defendant, Ze .Insuranc 0. , whether occurng 0 specific date or s or over a period of
time, and whet not specifically recited herein above.
The p ies wish to resolve all issues and to avoid the delays, hazds and
uncertinty of litigation. The defendants wish to buy their peace and the applicantdesires to settle for a lump sum certin. That the applicant is represented by
competent legal counel and that this Compromise & Release agreement and theterms and provisions herein, are intended to settle and release the employer and
;ie.h n)Bp5 Zenith Insuran e Co. from all claims arsi g fr m o tll-.h'O
-employment VYith Jefendaa:.JTr tm-im.
lOa, fuher consideration of t e payment in accordanc erewith, applicant agrees
tha ' s release ll apply to a unkown and unanticipate ' njuries and damagesresultin om such accident, casu , event, trauma, and/or em oyment as well
as all those disclosed, not disclosed iscovered or otherwise ticipatedpursuant to Sect1 1542 of the ivil e o Cali rnia are hereby expr waived. That Sectio 542 oftpe Civil Code reads as follows:
A ge al release does not ex d to claims whic e creditor does t know orsuspect to . st in his favor at the tJ e of executing the ease which i ownby him must ha materially affected Ii' in his settlement wIth the debtor.'
In further consideration of the payment of the aforestated sums , applicant agrees
that this release extends to and covers the executor, administrators , heirs
representatives , successors , assigns , officers , directors , agents , servants , and
employees of the defendants , and each of them , whether acting individually or onbehalf of them, or either of them.
ADDENDUM "A" (Page I)
2addfin,doc
. .
CASE NAME:WCAB NO.
lOb.
10c.
ADDENDUM "
REASON FOR COMPROMISE
The paries to ths Compromise & Release agreement do hereby settle any and allclaims the applicant may have if any regarding any of the following issues:
Employment, occupation, earings, injur arising out of an occurng in the
course of employment, pars of body claimed or sustained, if any, liabilty for
self-procured medical treatment, need for fuer medical treatment, responsibilty
for medical-legal costs , claims for reimbursement for mileage and/or out-of-pocket expenses pursuat to Labor Code Section 4600, any and all periods of
temporar disabilty, whether temporar total or temporar parial , extent of
permanent disabilty, apportionment, potential liabilty for new and fuerdisabili, penalty claims to date, prejudice to defendant for applicant' s lack of
notice to defend of claied injur and the Statute of Limitations. zt. II
/)
3/1:S
This agreement shall include twenty-five (25) days of interest from the date ofreceipt of the Order Approving Compromise & Release on all moneys paidhereunder pursuant to Labor Code Section 5800.
The applicant understads and has been fully advised by counsel that thissettlement forever releases the employer and Zenith Insurance Co. named hereinfrom any and all claims for death benefits. That pursuant to
Labor Code Section
5000(b), the applicant specifically, knowingly, and knowledgeably intends toCompromise and Release thi case, including any potential death benefits on thepar of any defendants , whether they be blood relatives of the applicant orotherwise. That said applicant's counsel explained both the purpose and the effect
of this provision and that the applicant fully understands that (s)he is furtherreleasing the defendants herein from any and all liability whatsoever rising fromany claims made herein, including death benefits pursued by any potential
. dependent or dependents as well as on behalf of any executor, administrator, heir
representative , successor, assign, offcer, director, agent, servant or employee of
defendant whatsoever herein. That these provisions are specifically contingentupon the Workers ' Compensation Judge issuing a finding pursuant to the case
Sumner v. WCAB (33 CAL 3rd 965 , 48 CCC 369(1983)) in which all claims ofdeath benefits are hereby released by the Order Approving this Compromise &Release agreement.
cC;: J/ /1'?/95
ADDENDUM A" (Page 2)
CASE NAME:WCAB NO.
10d.
10e.
1Of.
109.
lOh.
ADDENDUM "
REASON FOR COMPROMISE
less specifi ally stated 0 . se within this CompromIse Release
agre ent, the applicant does here dismiss with prejudice, any all claims of
serious an ilful misconduct against employer as well as any clai , if any,
pursuant to L Section 132(a) or tl egations thereof against sa d
employer.
Applicant has sole and exclusive responsibility for providing his or her ownmedical treatment in the future, if any, even if such treatment is needed in order toparicipate in any vocational rehabiltation program, if any. Applicant agrees thata demand in wrting must be served upon the defendant as a condition precedentto applicant being entitled to any vocational rehabiltation temporar disabilityindenrty (VRM) here'in whatsoever.
Applicant's attorney agrees that defendant's have no liabilty to pay any attorneysfees whatsoever to applicant's attorney (including, but not limited to Labor Code
Section 5710 fees and fees for services provided in connection with vocationalrehabilitation except as specifically set forth in the Order Approving thisCompromise andRelease agreement.
T e employer/defendant herein r serves all rights to claim or maintain action
eithe t law or before the Appeals oard for any claim or en ' ement to cre 'and/or reI ursement pursuant to the and including ut not limiteSections 3852, 4 3856 3858 3859 and 3861 respectively. That saidemployer/defendant re s its rights to maintal ' y action to recover c stsor benefits paid pursuant to this claim arising from the injuries herein.
This agreement encompasses all attached addenda and waivers herein. That thisagreement and the terms and provisions set forth herein constitute the entirety the agreement. There are no representations or oral statements made contrarwhatsoever.
ADDENDUM "A" (Page 3) JO. (i) fCvJ- Yt\
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CASE NAME:WCAB NOS.
ADDENDUM "
DISPOSITION OF SELF-PROCURED EXPENSES AND/ORMEDICAL-LEGAL LIENS
The following charges and/or liens of record for self-procured medical treatment
and/or medical-legal charges have been paid by the defendants, or will be paid fortwith
without reduction, or for which agreement has already been achieved with said lienclaimant(s), in which case the amount shown reflects that sum, said lien claimant(s) have
agreed to accept in full and final satisfaction of the lien amount (original lien amount inparentheses): defendants tae credit for any and all sums paid under ths paragraph, if
any:
The following are either self-procured charges and/or medical-legal liens to which
the defendant object. That defendants agreeto settle , adjust, litigate or render payment of
these charges. In the event hat either settlement or adjustment is not accomplished, then
with respect to any such item, the WCAB shall retain full , complete and exclusive
jurisdiction, wherein the defendants further reserve the right to raise and assert any and alldefenses , including, but not limited to , injur AOE/COE and the statute of limitations
with respect to any unadjusted item herein. (Defendants take credit for any and all sumspayable or previously p yabl hereunder.)
~~~
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~~~
afct'-lIv
' ,
Ul0w' \.AlV'-
The EDD lien shall be adjusted by the defendants outside of this agreement, from
which the applicant shall be held harless. In the event such adjustment is not
accomplished , then the WCAB shall retain jurisdiction.
(X)
Amount of EDD lien:
The EDD shall accept the sum of $its lien claim in the sum of $
')"rlrlfin r!,,('
in full and final satisfaction of
ADDENDUM "
DECLAR nON OF NON-INTENT TOSEEK REHABILITATION BENEFITS
UNDER LABOR CODE SECTION 139.
My attorneys of record have disclosed to me that a real and substantial possibilty exists
that I may be eligible to seek and attin certain benefits provided under Labor Code
Section 139.5 and that such benefits concern vocational rehabiltation.
That I am fully aware of the natue and extent of such benefits, the relationship to my
claimed injures pertining to my employment with the defendant , and that I am hereby
electing not to seek any of these benefits provided under Labor Code Section 139. , up
until the time that an Order is made approving this Compromise and Release. That by
makng this election, I am doing so without - coercion, fraud, duress, or undue infuenceand upon my own free wil and choice, and that such election is made knowigly andwilingly. .Furher, that I hereby waive any accrued benefits under Labor Code Section 139. , up to
and including the date that an Order is made on this Compromise and Release.
Finally, I understand that if the claim for vocational rehabilitation is not made one yearfrom the date of the Order Approving Compromise and Release or five years from thedate 0 injur, whichever occurs last, all rights to vocational rehabilitation are therebyterminated. (Labor Code Section 5405.5 and 5410.
M. PPLICA
G/f/7JDATE
C/rI'lDATE
ADDENDUM "CASE NAME:
?acicifin.doc
WCAB NO.
It is the specific intention of the P erein for which a porti?n of the consideration
has been paid, to also settle by vi . of ths Compromise and Release agreement, any
and all claims whatsoever for any penalties relating to any untimely or uneasonablydelayed payment or non-payment of any and all of the following:
Temporar disabilty, permanent disabilty, vocational rehabiltation temporar disabilty
(VRMA), permanent disabilty advances, medical treatment, pursuant to Labor Code
Section 4600, including but not limited to medical care, surgical, chiopractic treatment
hospital care, hospital treatment, nursing, medicines, medications, surgical supplies
crutches, apparatu, prosthetic devices and services and any other medical services
reasonably necessar to cure or otherwise relieve the effects of the indusal injur orinjuries herein whatsoever.
This settlement also resolves any and all disputes concernng mileage reimbursement
claims or unpaid doctors and/or .pharaceutical bils and any potential penaltiesrelating to same. (-f.. (i-""/lf-,h' 1.1 1,(
Pl.N' v". v' w.e . h'.
APPLICANT' ORNEY
Ufl'??DATE
((Ir"DATE
ADDENDUM "
2addfin.doc
. .
CASE NAME:WCAB NO.
ADDENDUM "
RELEASE OF ALL CLAIMS ARISING UNDER A REHABILITATIONPLAN WHICH OCCURS AS A SECONDARY CONSEQUENCE OF
THE INDUSTRIAL INJURY (RODGERS v. WCAB , 50 CCC 299: CARTER
v. COUNTY OF LOS ANGELES. ET AL , 51 CCC 255:
AGUIRR v. WCAB. 56 CCC 420)
It is the specific intention of the paries , for which a portion of this considerationhas been paid; to also settle by virte of this Compromise and Release agreementany and all claims of injur or injures, which could occur or arse durng the
course and scope of a rehabiltation plan or program. Such injures may include
but are not limited to:
(1)
(a)
(b)
(c)
(2)
hrlrHin rlC\('
injures arsing in the travefto or from a rehabilitation program.
Injures occurg while in the course and scope of a work evaluationprogram, work tolerance program , formal or informal conference, or
durng on-the-job training, to the extent that this settling defendant(s)would be liable , if at all.
Injures occurrng as a secondar consequence of the industrial injur,including an aggravation or exacerbation thereof.
(d) Injures occurng while engaged in job placement or job placementcounseling.
(e) Injuries which occur during a rehabilitation program, and which relate
either in whole or in par, to a weakess , disability, physical and/oremotional limitation, condition or disability, or frailty, arsing from theoriginal industrial injur or injuries.
This express waiver is made knowingly, expressly and with full knowledge ofthe
potential rights the applicant may have, if any, in the absence of this waiver and
release , made a par of the within Compromise and Release agreement.
ADDENDUM "E" (Page I)
CASE NAME:WCAB NO.
ADDENDUM "
RELEASE OF ALL CLAIMS ARISING UNDER A REHABILITATIONPLAN WHICH OVVURS AS A SECONDARY CONSEQUENCE OF
THE INDUSTRIAL INJURY (RODGERS v. WCAB , 50ccc 299: CARTER
v. COUNTY OF LOS ANGELES. ET AL, 51 CCC 255:
AGUIRR v. WCAB , 56 CCC 420)
(3) This express waiver and release shall apply to any potential injur or injures
which occur durng the course and scope of the pendency of a rehabiltationprogram, and shall be consistent with the provisions set forth in Rodgers vs.
WCAB. Therefore, ths waiver and release shall apply only to those injuresoccuring durng a rehabiltation program or plan, which are the compensable
consequence of the prim injur and for which ths settling defendant(s) would
be liable in whole or in par.
L.L
APPLICAN RN .
/d
DATE
G( ( (97DATE
ADDENDUM "E" (Page 2)
. .
PROOF OF SERVICE
STATE OF CALIFORNIA, COUNTY OF LOS ANGELES
I am employed in the County of Los Angeles , State of California. I am over the
age of eighteen years and not a party to the within action; my business address is 21255
Califa Street, Woodland Hils , California 91367-5021.
On June 9 , 1999 I served the foregoing document described as COMPROMISE& RELEASE; ORDER APPROVIG on each interested party in this action by
placing _the original a true copy thereof enclosed in a sealed envelope addressed
as stated on the attached mailng list.
(Ordinary Course of Business) I placed each such sealed envelope for collectionand mailng at Ingber , Chernow & Lieb , Woodland Hils , Californa on the date
hereof following ordinary business practices. I am readily familar with the finnbusiness practice for collection and processing correspondence for mailing withthe U. S. Postal Service. Under that practice , correspondence is deposited with
the U. S. Postal Service in the ordinary course of business on that same day withpostage thereon fully prepaid.
(Personally Mailed) I deposited each such envelope with postage thereon fullyprepaid in the United States mail at Woodland Hils , California.
(By FAX) I caused the foregoing document to be served by facsimiletransmission at the time shown on each attached transmission report from sendingfacsimile machine telephone number (818) to each interested party at the
facsimile machine telephone number shown on the attached list. Each transmission was
reported as complete and without error. A transmission report was properly issued bythe sending facsimile machine for each interested party served. A true copy of each
such transmission report is attached hereto.
Executed on June 9 , 1999 at Woodland Hils , California.
I declare , under penalty of perjury, under the laws of the State of California that
the foregoing is true and correct.
SA. Y PALO AREZ McGILL
j "
I 20
ATTACHMENT TO MAILING LIST
RE: WCAB Case No. VNO 0364371Timothy Taylor vs. Martin Engineering Company;Zenith Insurance Company IZenith Claim No: 10225
Nick Kasandjieff, Esq. Law Offices of Shelley & Graff301 East Colorado Blvd. , Suite 210Pasadena , California 91101-1960
, 8
Jim VikupitzZenith Ins.(via interoffce mail)
West Coast Spine Restoration6177 River Crest Dr. , Ste..Riverside , CA 92507
Warren Jones , M.301 E. Colorado BI. , #628
. Pasadena , CA 91101
Marvin Piper, M.O. Box 999
Altadena , CA 91001
PROOF OF SERVICE
I declare that: I am employed in the County of Los Angeles, Californa. I am over the ageof eighteen years and not a pary to the within cause; my business address is 2049 Centu ParkEast, Suite 3200 , Los Angeles , Californa 90067-3206.
On June 10 2005 , I served the foregoing document described as:
DEFENDANTS' JOINT PETITION TO DISMISS APPLICANTS' SECONDAMNDED COMPLAINT
by placing the original tre copies thereof enclosed in a sealed envelope addressedas follows:
See attached Service List
(By Fax) By transmitting a true and correct copy thereof via facsimile transmission.
(By U.S. Mail) I am "readily familiar" with the firm s practice of collection andprocessing correspondence for mailing. Under that practice, it would be deposited withU.S. postal service on that same day with postage thereon fully prepaid at Los AngelesCalifornia, in the ordinary course of business. I am aware that on motion of the paryserved, service is presumed invalid if postal cancellation date or postage meter date is morethan one day after date of deposit for mailing in affdavit.
(By Personal Service)By personally delivering such envelope to the addressee.By causing such envelope to be delivered by messenger to the offce oftheaddressee.
(By Next-Day Delivery Service) By causing such envelope to be delivered to the office ofthe addressee by overnight delivery via FedEx or by other similar overnight deliveryservIce.
(State) I declare under penalty of peIjury under the laws of the State of Californa that theabove is tre and correct.
(Federal) I declare that I am employed in the office of a member of the bar of this cour atwhose direction the service was made.
Executed on June 10 2005 , at Los Angeles, California.
S. MICHIKO KONDOType or Print Name
SERVICE LIST
lllian. et al. v. Zurich U.S.. et al.
Nick 1. Kazandjieff, EsquireBruce Traney, EsquireKazandjieff & Traney15216 Burbank Boulevard, Suite 103Sherman Oaks , CA 91411
Patrck DeBIase, EsquireKiesel, Boucher & Larson LLP8648 Wilshire BoulevardBeverly Hils, CA 90211
Paul E. B. Glad, EsquireSean McEneany, EsquireSonneschein, Nath & Rosenthal685 Market Street, 6th FloorSan Francisco, CA 94105
David C. Capell , EsquireElizabeth Vanalek, EsquireGordon & Rees , LLP275 Battery Street, 20th FloorSan Francisco , CA 94111
Frank Falzetta, EsquireSheppard, Mulln Richter & Hampton LLP333 South Hope Street, 48
tli FloorLos Angeles , CA 90071- 1448
Craig S. Simon , EsquireTeresa R. Ponder, EsquireBerger, Kahn, Shafton, Moss , FiglerSimon & Gladstone2 Park Plaza, Suite 650Irvine, CA 92614
Attorneys for ApplicantsTel: (818) 373-4500Fax: (818) 373-4501
Attorneys for ApplicantsTel: (310) 854-4444Fax: (310) 854-0812
Attorneys for DefendantFireman s Fund Insurance CompanyTel: (415) 882-5001Fax: (415) 543-5472
Attorneys for DefendantConstitution State ServiceCompanyTel: (415) 986-5900Fax: (415) 986-8054
Attorneys for DefendantState Compensation Insurance FundTel: (213) 620- 1780Fax: (213) 620- 1398
Attorneys for DefendantThe Hartford Insurance Companyand Specialty Risk ServicesTel: (949) 474- 1880Fax: (949) 474-7265
Rebecca R. Weinreich, Esquire Attorneys for DefendantsLewis Brisbois Bisgaard & Smith American Guarantee and Liability221 North Figueroa Street, Suite 1100 Insurance Company, ZurichLos Angeles, CA 90012 American InsuranceCompan
h (assuccessor-in- interestto ZuricInsurance Co. , U.S. Branch),American Zurich InsuranceCompanyTel: 213) 250- 1800Fax: 213) 250-7900
Edwin 1. Lucks , Esquire Attorneys for Defendants FarmersTobin Lucks LLP Insurance Exchange , Mid-Century21300 Victory Boulevard, Third Floor Insurance Company and FremontWoodland Hils, CA 91367 Compensation Insurance Company
Tel: (818 226-3400Fax: (818 226-3401
Laurence 1. Hutt, Esguire Attorneys for DefendantsAmy B. Levin, EsqUire Continental Casualty Company andArold & Porter LLP RSKCo Claims Services , Inc.777 South Figueroa Street, 44th Floor Tel: 213 243-4100Los Angeles , CA 90017 Fax: 213 243-4199
John A. Karaczynski , Esquire Attorneys for Defendants LibertyJonathan Gottlieb, Esquire Mutual Insurance Company,Akin, Gump, Strauss , Hauer & Feld Liberty Mutual Fire Insurance2029 Century Park East, Suite 2600 Company and Liberty MutualLos Angeles, CA 90067 Insurance Group
Tel: 31 0) 229- 1000Fax: 310) 229- 1001
Steven H. Wax, Esquire Attorneys for DefendantPearlman, Borska & Wax
Eublic Indemnity Company of15910 Ventura Boulevard, 18th Floor Ca iforniaEncino , CA 91436-2819 Tel: 818 501-4343
Fax: 818 386-5700
Paul A. Larsen, Esquire Attorneys for DefendantMilam & Larsen
Eublic Indemnity Company of234 East Colorado Boulevard, Suite 620 Ca iforniaPasadena, CA 91105 Tel: 626) 585- 1888
Fax: 626) 585- 1886
Steven M. Sion, Esquire Attorneys for Defendant BroadspireSun Park, Esquire LLC , formerly Kemper NationalLaw Offices of Steven M. Sion, Inc. Insurance Company555 West Fifth Street, 31st Floor Tel: 213) 996-8333Los Angeles , CA 90013 Fax: 213) 996-8345
Bett R. Quarles , Esquire Attorneys for DefendantState Compensation Insurance Fund State Compensation Insurance Fund900 Corporate Center Drive Tel: 323 526-2141Monterey Park, CA 91754 Fax: 323 526-2012
Arletta Shirinian, Esquire Attorney for DefendantLaw Offices of Arletta Shirinian Gates McDonald1027 S. Central Ave. , Suite 200 Tel: 818 546-8811Glendale , CA 91204 Fax: 818 546-2288
Jerilyn Cohen, Esquire Attorneys for DefendantLaughlin, Falbo , Levy & Moresi LLP Ralphs Grocery Company200 S. Los Robles Avenue , Suite 500 Tel: 626 568-9700Pasadena, CA 91101 Fax: 626 568-3905
Wiliam Tappin, Esquire Attorneys for DefendantRandall K. L. Kam, Esquire Gallagher Bassett Services , Inc.Tappin & Norton Tel: 626) 585-653570 South Lake Avenue, Suite 950 Fax: 626) 585-9870Pasadena, CA 91101-4707
James P. Diwik, Esquire Attorneys for DefendantMary C. Richardson, Esquire Crawford & CompanySedgwick, Detert, Moran & Arnold Tel: 415 781-7900One Embarcadero Center, 16 FIr. Fax: 415 781-2635San Francisco, CA 94111-3628
Jason B. Schlossberg, Esquire Attorneys for DefendantsSchlossberg & Associates Keenan & Associates5200 West Century Boulevard Tel: (31 o 568-8460Suite 380 Fax: (310 568-0274Los Angeles , CA 90045
James Napier, Esquire Attorney for DefendantDeputy CIty Attorney City of Los Angeles700 East Temple Street, Room 220 Tel: 213 847-9822Los Angeles , CA 90012 Fax: 213 847-9274
Ms. Rhoda Quirit DefendantsRecon Administrative Services Recon Administrative ServicesPost Office Box 368 Tel: 909 922-2828Banning, CA 92220 Fax: 909
Leah D. Davis , Esquire Attorney for DefendantSenior D uty County Counsel County of Los AngelesCounty 0 Los Angeles Tel: (213) 974- 1864500 West Temple Street, Suite 648 Fax: (213) 687-4745Los Angeles , CA 90012
James R. Ross, Esquire Attorneys for DefendantRoss & Sarret ress Insurance465 North Halstead Street, Suite 104 Te: 626 351- 1180Pasadena, CA 91107 Fax: 626 351- 1622Mail: P. BOX7008pasadena CA 91109
Steven V. Fabiano, Esquire Attorneys for DefendantTaylor, Fabiano, Gilmore & Sullivan
fonaut Insurance Company28118 Agoura Road, Suite 201 Te : 818 591-3970Agoura Hi1 , CA 91301-2423 Fax: 818 591-3980
Robert Wheatley, Esquire Attorneys for DefendantsYvette A. Boehnke, Esquire National Union Fire InsuranceLaw Offices of Robert Wheatley Company, Insurance Company of550 North Golden Circle Drive the State of PennsylvaniaSanta Ana, CA 92705-3906 American Home Assurance and
AIG Claims Services , Inc.Tel: (714 560-0199Fax: (714 560-0188
Virgil L. Roth, Esquire Attorneys for DefendantShannon M. Benbow, Esquire Kaiser Foundation HospitalLaw Offices of Virgil L. Roth Tel: (626 441- 1165625 Fair Oaks Avenue, Suite 255 Fax: (626 441- 1166South Pasadena, CA 91030
Robert A. Lewis , Esquire Attorneys for DefendantChrstine Hoverman, Esquire Sedwick Claims ManagementBingham McCutchen LLP Services (formerly known asThree Embarcadero Center Sedgwick James)San Francisco, CA 94111-4067 Tel: 415) 393-2000
Fax: 415) 393-2266
Rex Altman, Esquire Attorneys for DefendantElliot Kushner, Esquire Cambridge Integrated ServicesAltman, Hambleton & Lunche Group, Inc.lPresidium16255 Ventura Boulevard, Suite 1110 Tel: 818 995-0080Encino , California 91436 Fax: 818 995-3419