Judge: Daniel S. Murphy, Case: 21STCV45265, Date: 2023-08-16 Tentative Ruling

Case Number: 21STCV45265    Hearing Date: August 16, 2023    Dept: 32

BACKGROUND

            This is a products liability and medical negligence action first filed on December 10, 2021. The operative First Amended Complaint was filed on December 29, 2021. The action is brought by Plaintiffs Danae Locatelli, Danielle Peckham, Deborah Koch, and Duane Otrambo against Defendants Kaiser Foundation Health Plan, Inc., Kaiser Foundation Hospitals, Southern California Permanente Medical Group, Inc., and Does 1 through 100. Defendants Livanova Deutschland, GMBH and Livanova Holdings USA, Inc. were identified as Does 1 and 2, respectively. The action stems from the death of Decedent Dora Otrambo after a medical procedure.

            On March 17, 2023, Plaintiffs and the Kaiser Defendants entered into a settlement agreement wherein Plaintiffs agreed to dismiss the case with prejudice in exchange for $220,000 and waiver of all Kaiser liens. On May 11, 2023, the Kaiser Defendants filed their application for determination of good faith settlement.

            On June 2, 2023, the non-settling Livanova Defendants filed the instant motion to challenge the determination of good faith settlement. Kaiser filed their opposition on July 14, 2023. Livanova filed their reply on August 9, 2023.

LEGAL STANDARD

Code of Civil Procedure section 877.6 governs the procedure for determining whether a settlement was made in good faith. The statute provides that a settling party may file an application for determination of good faith settlement by indicating the settling parties and the basis, terms, and amount of the settlement. (Code Civ. Proc., § 877.6, subd. (a)(2).) The issue of good faith may be determined by the Court based on affidavits filed with the application and other evidence presented at the hearing. (Id., § 877.6, subd. (b).) A determination of good faith by the Court bars any other joint tortfeasor from any further claims against the settling tortfeasor for equitable comparative contribution, or partial or comparative indemnity, based on comparative negligence or comparative fault. (Id., § 877.6, subd. (c).)

In Tech-Bilt, Inc. v. Woodward-Clyde & Associates (1985) 38 Cal.3d 488, 499, the California Supreme Court concluded that a number of factors must be taken into account in assessing a settlement’s good faith under Section 877.6, including: (1) a rough approximation of plaintiffs’ total recovery and the settlor’s proportionate liability, (2) the amount paid in settlement, (3) the allocation of settlement proceeds among plaintiffs, (4) a recognition that a settlor should pay less in settlement than he would if he were found liable after a trial, (5) the financial conditions and insurance policy limits of settling defendants, and (6) the existence of collusion, fraud, or tortious conduct aimed to injure the interests of non-settling defendants. These factors are not exhaustive and may not apply in all cases. (Dole Food Co., Inc. v. Superior Court (2015) 242 Cal.App.4th 894, 909.) Further, “[p]ractical considerations require that [their] evaluation be made on the basis of information available at the time of settlement.” (Ibid.)

DISCUSSION

            A determination of good faith settlement may be established through affidavits. (Code Civ. Proc., § 877.6(b).) The party seeking a determination of good faith settlement is not required to submit “a full recital by declaration or affidavit setting forth a complete factual response to all of the Tech-Bilt factors” because “[a]t the time of filing in many cases, the moving party does not know if a contest will develop.” (City of Grand Terrace v. Superior Court (1987) 192 Cal.App.3d 1251, 1261.) “The party asserting the lack of good faith shall have the burden of proof on that issue.” (Code Civ. Proc., § 877.6(d).) This burden may be satisfied with evidence that the settlement figure is “grossly disproportionate” or far “out of the ballpark” compared to a reasonable estimate of the defendant’s potential liability. (Tech-Bilt, supra, 38 Cal.3d at p. 499.)

            Here, the declaration of Kaiser’s counsel in support of the application for determination of good faith settlement avers that the settlement “resulted from good faith negotiations and is not the product of any collusion, fraud, or tortious conduct aimed at injury the non-settling defendants.” (May 11, 2023 Trotter Decl. ¶ 4.) Defense counsel further averred that “[i]t is my professional opinion that the terms of this settlement represent moving respondent's proportionate share of potential liability, or more, and that the settlement amount is less than that which would be awarded at trial should moving defendant be found liable.” (Id., ¶ 5.)  

Livanova argues that Kaiser’s application lacks sufficient information for a good faith determination. Specifically, Livanova takes issue with the fact that Kaiser’s application is unaccompanied by an estimate of Plaintiffs’ likely recovery at trial, Kaiser’s rough percentage of liability, evidence of Kaiser’s insurance or financial condition, or analysis of Livanova’s potential liability.

Livanova has no evidence to demonstrate that the settlement is so far out of the ballpark of Kaiser’s potential liability as to constitute bad faith. (See Code Civ. Proc., § 877.6(d) [the burden of establishing bad faith lies with the challenging party].) Additionally, not all of the Tech-Bilt factors apply in every case, and a party applying for determination of good faith need not address all of them. (See Dole Food Co., supra, 242 Cal.App.4th at p. 909; City of Grand Terrace, supra, 192 Cal.App.3d at p. 1261.)

It should be noted that settling defendant’s liability is limited by California Civil Code, Section 3333.2.  Settling defendant points out that it is paying 81% its total exposure.  Clearly, the settlement is reasonably within the ballpark of Kaiser’s potential liability absent contrary evidence.

CONCLUSION

            The motion to challenge determination of good faith settlement is DENIED. The Court finds the settlement to have been in good faith.