Judge: Armen Tamzarian, Case: 20STCV30534, Date: 2024-01-31 Tentative Ruling

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Case Number: 20STCV30534    Hearing Date: January 31, 2024    Dept: 52

Defendants Kaiser Foundation Health Plan, Inc., Kaiser Foundation Hospitals, and Southern California Permanente Medical Group’s Application for Order Determining Good Faith Settlement

Defendants Kaiser Foundation Health Plan, Inc., Kaiser Foundation Hospitals, and Southern California Permanente Medical Group (Kaiser) apply for an order determining good faith settlement under Code of Civil Procedure section 877.6(a). 

Background

            This action arises from injuries plaintiff Catherine Pham, D.D.S. alleges she suffered due to a defective medical device.  Defendants LivaNova Holding USA, Inc. and LivaNova Deutschland, GmbH (LivaNova) manufactured the device.  The Kaiser defendants used it while treating Pham.  Co-plaintiff Tuan H. Tran is Pham’s spouse and alleges one cause of action for loss of consortium against all defendants.  The Kaiser defendants settled with plaintiffs in exchange for waiving Kaiser’s lien of $1,034,160.   

Evidentiary Objections

            LivaNova makes five objections to the declaration of Matthew N. Trotter, Kaiser’s counsel.  Objection Nos. 1 and 2 are overruled.  Objection Nos. 3-5 are sustained.

            LivaNova makes five objections to the declaration of Albro L. Lundy, III, counsel for plaintiffs Catherine Pham, D.D.S. and Tuan H. Tran.  Objection No. 1 is overruled.  Objection Nos. 2 and 3 are sustained.

Legal Standard

When only some of multiple defendants alleged to be jointly liable settle a case, the settling parties may apply to the court for a determination of good faith settlement.  (CCP § 877.6(a).)  A determination of good faith settlement “shall bar any other joint tortfeasor or co-obligor from any further claims against the settling tortfeasor or co-obligor for equitable comparative contribution, or partial or comparative indemnity, based on comparative negligence or comparative fault.”  (CCP § 877.6(c).)

In Tech-Bilt, Inc. v. Woodward-Clyde & Associates (1985) 38 Cal.3d 488 (Tech-Bilt), the California Supreme Court set forth a non-exclusive list of factors to consider in making this determination.  “The intent and policies underlying section 877.6 require that a number of factors be taken into account including a rough approximation of plaintiffs’ total recovery and the settlor’s proportionate liability, the amount paid in settlement, the allocation of settlement proceeds among plaintiffs, and a recognition that a settlor should pay less in settlement than he would if he were found liable after a trial.  Other relevant considerations include the financial conditions and insurance policy limits of settling defendants, as well as the existence of collusion, fraud, or tortious conduct aimed to injure the interests of nonsettling defendants.  [Citation.]  Finally, practical considerations obviously require that the evaluation be made on the basis of information available at the time of settlement.”  (Id. at p. 499.)

The opposing party bears “the burden below to show the settlement amount was ‘so far “out of the ballpark” in relation to’ the Tech–Bilt factors that the settlement was inconsistent with the equitable objectives of section 877.6.”  (Cahill v. San Diego Gas & Electric Co. (2011) 194 Cal.App.4th 939, 967 (Cahill); accord CCP § 877.6(d) [“The party asserting the lack of good faith shall have the burden of proof on that issue”].)  Because the opposing party bears the burden of proof, the moving party is “not compelled to make a showing as to their proportionate liability” when bringing its motion.  (Mattco Forge, Inc. v. Arthur Young & Co. (1995) 38 Cal.App.4th 1337, 1350, fn. 6 (Mattco).)  But after an opposing party “attack[s] the settlement as lacking in good faith,” the moving party must “file counter-affidavits (§ 877.6, subd. (b)) to make an evidentiary showing that the settlement was ‘in the ballpark.’ ”  (Ibid.) 

To prevail over an opposing party, “[s]ection 877.6 and Tech–Bilt require an evidentiary showing, through expert declarations or other means, that the proposed settlement is within the reasonable range permitted by the criterion of good faith.”  (Mattco, supra, at p. 1351.)  A determination of good faith requires “substantial evidence,” which “is not synonymous with ‘any’ evidence; rather, it means the evidence must be of ponderable legal significance, reasonable, credible, and of solid value.”  (Cahill, supra, 194 Cal.App.4th at p. 958.)  Finally, “the determination whether the settlement was in good faith must be based on competent, admissible evidence.”  (Brehm Communities v. Superior Court (2001) 88 Cal.App.4th 730, 736 (Brehm).)

Kaiser presents insufficient evidence on the crucial factors: plaintiffs’ approximate total recovery and Kaiser’s proportionate liability.  Kaiser’s memorandum makes various claims, without citing any evidence, about plaintiff Pham’s age, health, and earnings, and about the amount of damages she claims in this action.  As in Mattco, this is an “argument, unsupported by affidavits.”  (38 Cal.App.4th at p. 1351.)   

Kaiser’s moving papers present only two pieces of evidence: declarations by Kaiser’s counsel and by plaintiffs’ counsel.  The declarations do little more than state the attorneys have great experience in similar cases and believe the settlement is fair.  That is insufficient.  (See Brehm, supra, 88 Cal.App.4th at pp. 735-736; Greshko v. County of Los Angeles (1987) 194 Cal.App.3d 822, 834.)  The attorneys testify about the nature of the action, the circumstances of the settlement, and make conclusory statements about the total recoverable damages and Kaiser’s proportion of liability.  (Trotter Decl., ¶¶ 2-5; Lundy Decl., ¶¶ 3-5.)  Both attorneys describe what expert witnesses will state in their testimony (Trotter Decl., ¶¶ 7-8; Lundy Decl., ¶ 7), which is inadmissible hearsay.

The record does not contain substantial evidence that this settlement was in good faith.  Kaiser’s only substantive evidence is a “Whole Genome Sequencing Report which confirms Dr. Pham’s isolate was ‘genetically similar to the representative reference isolates … implicated in the HCU M. Chimaera outbreak.’ ”  (Trotter Decl., ¶ 9, Ex. A.)  Kaiser argues this evidence suggests the medical device was contaminated during the manufacturing process before Kaiser acquired it.  Kaiser provides no evidence explaining the meaning of “genetically similar.”  Kaiser did not present declarations by the expert witnesses themselves and did not submit evidence of, for example, Pham’s past earnings or likely future earnings, plaintiffs’ other damages, or even the amount plaintiffs claim in damages. 

Disposition

Defendants Kaiser Foundation Health Plan, Inc., Kaiser Foundation Hospitals, and Southern California Permanente Medical Group’s motion for determination of good faith settlement is denied without prejudice.

Defendants LivaNova Deutschland GmbH and LivaNova Holding USA, Inc.’s Motion for James A. Frederick to Appear as Counsel Pro Hac Vice

Defendants LivaNova Deutschland GmbH and LivaNova Holding USA, Inc.’s motion to admit James A. Frederick to appear as counsel pro hac vice is granted.