California Personal Injury Law Case Notes : California Personal Injury Lawyer & Attorney : Kristine Meredith : The Danko Law Firm : Car Accidents & Product Liability

Judge Dylina started out today by explaining that he believes he was selected to be the judge for the San Bruno Fire cases because of his experience with complex cases and also his experience as a settlement judge.  No surprise there.  But then he made clear that the San Bruno Fire cases are the court's first priority. That's unusual. In general, judges say that all cases are equally important, and that every plaintiff must wait his turn. But the judge stated repeatedly that the San Bruno residents have suffered horrific losses, and that the cases are of special importance to the community and to people of San Mateo County generally. For that reason, they are to be given priority over other cases.  The judge says he intends to get the cases resolved as quickly as possible.

Included in the coordinated lawsuits is one brought by PG&E shareholders against PG&E management. The shareholders claim that management knew about the pipeline problems and did nothing to stop the explosion from happening. By allowing the explosion, the lawsuit claims, management hurt the price of PG&E's stock. Judge Dylina "stayed" -- or froze -- that lawsuit. He ruled that the priority was the San Bruno residents, not the shareholders. Allowing the stockholder lawsuit to proceed would take away time he could better spend on the cases involving the residents. So he will turn to the shareholders actions down the road, only after the residents' cases have been "substantially resolved."

There are two class actions included in the cases. Judge Dylina indicated that he did not think the class actions were appropriate. It is highly unlikely they will be proceeding to trial. Each victim suffered unique harm. Thus, each needs his or her own lawyer, and each lawsuit needs to be separately brought.  

All this is good news for victims.  At long last, the cases are finally on the right track. Judge Dylina set the next hearing for June 30. At that time, a more detailed schedule will be set. Until then, plaintiffs are not allowed to force PG&E to turn documents over or have witnesses appear for depositon. But after June 30th, according to the judge, "the floodgates will open."

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When a wrongdoer causes injury, he must pay the victim’s hospital bills. If the victim happens to have insurance, the insurance company will often settle those bills before trial. Should the wrongdoer be required to pay the victim for the full amount of the hospital bills? Or only the amount the insurer paid to settle the bills? That was the issue argued today before the California Supreme Court, in Howell v. Hamilton Meats.

The question is a difficult one. Plaintiffs note that, under the collateral source rule, the one who caused the injury shouldn’t benefit simply because the person he injured maintains insurance. On the other hand, defendants argue that they shouldn’t have to pay for medical bills for which the victim was never on the hook. 

The Court’s decision is due in 90 days.

Here are some of the questions that the justices asked and the answers that the lawyers gave. (I’ve paraphrased liberally.)

To the Defense (Represented by Mr. Tyson and Mr. Olsen):

Q: Isn’t the part of the bill that a hospital writes-off for the insurer properly included as “damages” that that the injured party has suffered?

A: No, because the hospital agreed with the health care insurer to write off those amounts before the victim ever arrived at the hospital. Because the victim never incurred those amounts in the first place, they aren’t “damages.”

Q: Why should victims who have never paid premiums and who are thus uninsured be entitled to recover the full amount of their medical bills, while those who have shelled out for insurance for their whole lives recover less? It seems like we’d be treating the uninsured victim better than victims who are insured, no?  Isn’t that the reason for the collateral source rule, to make sure people aren’t penalized for having insurance?  

A:  Were the Court to limit recovery to the amount of the medical bills that were actually paid, it would not be penalizing people for having insurance. The person who has insurance never had to worry about paying his medical bills. That benefit is preserved. 

Q: Wouldn’t allowing the wrongdoer to get off paying less than the full amount of the bills when the victim has insurance be a windfall to the wrongdoer? Wouldn’t he be getting a benefit that the victim, not the wrongdoer, paid for?

A: There would be no windfall because the wrongdoer is in each case paying the actual amount for which the victim is responsible to pay. No more, no less.

To the plaintiff (Represented by Mr. Simms):

Q:  A plaintiff can recover only “damages suffered.” That means harm to plaintiff. If the plaintiff is not required to pay the full amount of the bills, because insurance negotiates them down, how can you say the plaintiff has suffered damages in the full amount of the bill?

A: The plaintiff signs a contract when he walks in the hospital to pay the full amount of the bills. The fact that his insurer later pays less than the full amount to settle the bills doesn’t mean the plaintiff never incurred them. 

Q: But if the plaintiff doesn’t actually come out of pocket to pay them, how is that damages under the Civil Code?

A: When an injured party files bankruptcy, he is no longer obligated to repay the bills, either. But we don’t let the wrongdoer off the hook in that case. Why should we here?

Q: Why should plaintiff be allowed to collect and keep the amount that the hospital has written off due to its agreement with the insurer? Isn’t that a windfall to the plaintiff?

A: There is no evidence in the record that the injured party will keep the amounts written off if that amount is awarded as damages. The insurer may still have a right of reimbursement and the health care provider may have a lien against the recovery.

 Update: Supreme Court Decides:Interview with Gary Simms

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The U.S. Department of Health and Human Services has recognized 37 U.S. hospital and health care facilities for their efforts to prevent hospital-associated infections (HAIs), a leading cause of death in the United States. The awards recognizes individuals and institutions for their efforts to reduce ventilator-associated pneumonia and bloodstream infections associated with central intravenous lines.

HAIs are infections that are acquired while patients are receiving medical treatment for other conditions. One in every 20 hospital patients acquires an infection related to his hospital care. HAIs can have devastating emotional, financial and medical consequences.

“People enter a hospital expecting to get healthier, not sicker,” said Assistant Secretary for Health, Howard K. Koh, MD, MPH. “We applaud hospitals for their efforts in improving the quality and safety of health care for all Americans.”

Awards were conferred on two levels, according to specific criteria tied to national standards. The “Outstanding Leadership Award” went to teams and organizations that sustained success in reaching their targets for 25 months or more. The “Sustained Improvement Award” recognizes teams that demonstrated consistent and sustained progress over an 18- to 24-month period.

Of the 37 Initial award recipients one Northern California hospital -- Seton Medical Center in Daly City -- was recognized in the category “Achievements in Eliminating Ventilator-Associated Pneumonia” with an “ Outstanding Leadership Award”. Three Southern California facilities received “Sustained Improvement” Awards: St. Joseph Hospital, Orange; Huntington Memorial Hospital, Pasadena; and Palmdale Regional Medical Center, Palmdale.

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Health care facilities - whether hospitals, nursing homes, or outpatient facilities - can be dangerous places. One risk is “hospital-associated illnesses,” also called "hospital-acquired illnesses." 1.7 million patients contract HAIs each year. In 2002, nearly 100,000 patients died from HAIs. The fatalities broke down as follows:

36,000- pneumonia,
31,000 - bloodstream infections,
13,000 - urinary tract infections,
8,000 - surgical site infections, and
11,000 - infections of other sites.

Many HAIs are caused by breaches of infection control practices and procedures, unclean and non-sterile environmental surfaces, or ill employees.

Ventilator-associated pneumonia (VAP) occurs in people who are on mechanical ventilation through an endotracheal or tracheostomy tube. VAP results when and infection floods the alveoli - small, air-filled sacs in the lung responsible for absorbing oxygen from the atmosphere. VAP is distinguished from other kinds of infectious pneumonia by the different types of microorganisms responsible, antibiotics used in treatment, methods of diagnosis, ultimate prognosis, and effective preventive measures. The organism associated with VAP is most often Pseudomonas.

Central line-associated blood stream infections (CLABSIs) are blood infections introduced by a central venous catheter, or tube placed in a large vein in a patient's neck, chest, or groin to administer medication or fluids or to collect blood samples.

Urinary tract infections (UTIs) afflict patients with indwelling urinary catheters, patients undergoing urological manipulations, long-stay elderly male patients and patients with debilitating diseases. The organisms responsible may originate from the patient’s own body or from a moist site in the hospital environment. Pathogens causing HAI UTIs tend to have a higher antibiotic resistance than simple UTIs.

Hospitals have sanitation protocols regarding uniforms, equipment sterilization, washing, and other preventative measures. Thorough hand washing and/or use of alcohol rubs by all medical personnel before and after each patient contact is one of the most effective ways to combat hospital associated infections. Careful use of antimicrobial agents, such as antibiotics, is vital.

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The wrinkle reducer, Botox is approved by the FDA for very narrow uses only. But Allergan, its manufacturer, has promoted it to doctors all over the country for other uses, including muscle spasms. A doctor’s use of a drug for a purpose not approved by the FDA is often referred to as an “off-label” use. When a doctor used Botox “off-label” to treat Virginian Douglas Ray for hand tremors, it quickly led to brain damage. According to his wife, he now requires round-the-clock care and speaks very few words.

Botox is a purified form of the poison botulinum and is given as an injection. The drug is approved to treat “muscle stiffness” in the fingers and arms, “upper limb” spasticity, and chronic migraine headaches. Botox can migrate outside the injected muscles and cause side effects including botulism and severe autoimmune reactions with resulting brain damage.

Ray claimed Allergan did not properly warn his doctor about the risks of using the drug. A jury agreed, ordering Allergan Inc. to pay to Ray $12 million in compensatory damages and $200 million in punitive damages. This award by the U.S. District Court jury in Richmond, Va., was the largest penalty ever in a Botox injury case.

Botox is Allergan’s top-selling drug, with $1.42 billion in sales last year, or 29 percent of the drug maker’s revenue, according to data collected by Bloomberg.

This is not the first time the Botox manufacturer has had to pay penalties. In September of 2010, the federal government ordered Allergan to pay $600 million to settle civil and criminal allegations against the drug manufacturer for illegally marketing Botox for other uses. Allergan has also been accused of paying kickbacks to doctors and enticing them with all expense paid weekends to learn about off-label usage. 

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In July 2009 -- more than a year before the San Bruno explosion -- we warned about the dangers to the public posed by PG&E's aging underground infrastructure.  Back then, we were focusing on the utility vaults hidden beneath the streets and sidewalks of San Francisco and other urban areas.  They have a long history of exploding without warning. We called them "timebombs beneath the streets" because, frankly, that's what they are.

When the newscast aired, PG&E pledged it was doing all it could to fix the problem of its aging infrastructure.  We didn't believe them. 

And then the San Bruno fire happened.

Now, almost two years after the newscast first aired, Steve Johnson of the San Jose Mercury News has begun to investigate the hazards posed by PG&E's underground vaults.  Perhaps the most astounding part of his front page article  is that PG&E appears to have no idea of exactly how many of its underground vaults have exploded over the past few years.

While this newspaper counted 78 Bay Area underground mishaps since 2005 PG&E said before Wednesday's incident that it knew of just 35 throughout its entire service territory, which covers 70,000 square miles from Eureka to Bakersfield. The California Public Utilities Commission -- which only tracks the worst accidents -- said it is aware of 11 PG&E incidents during that period, six for Southern California Edison and none for San Diego Gas & Electric.

That doesn't exactly instill us with confidence that PG&E -- or the CPUC for the matter -- is on top of the situation.  Who, then, is protecting public safety?

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Usually, a homeowner who hires an independent contractor can delegate the responsibility for safety to the contractor. The theory behind the rule is that when an owner hires an independent contractor—or when a prime contractor hires a subcontractor—the responsibility for the safety of the contractor’s employees belongs with the independent contractor, not with the person who hired the contractor.

There is an important exception to the independent contractor rule. The rule does not apply to contractors who are not properly licensed. A provision of the California Labor Code  presumes that, for work that requires a contractor’s license, the unlicensed contractor is deemed to be an employee of the one who hires him and not an independent contractor. That can mean that the homeowner who hired the worker loses the protection of the independent contractor rule and can be held responsible for his worker’s safety, just as any other employer.

Recently the California Supreme Court held that a significant residential remodel, even one managed by an owner-builder and not by a professional contractor, was subject to the Cal-OSHA regulations. As discussed here, significant remodel is exactly the type of construction activity that OSHA was intended to regulate, and was not a “household domestic service” like tree trimming or home maintenance that was exempt from regulation.  The Court’s ruling allows the unlicensed injured worker to proceed with his lawsuit against the homeowner, and to introduce into evidence the violations of Cal-OSHA regulations to establish the homeowner’s fault.

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