Judge Theresa M. Traber, Case Number: BC648395, Date: 2024-11-27 Tentative Ruling

Judge: Theresa M. Traber, Case: BC648395, Date: 2024-11-27 Tentative Ruling

Case Number: BC648395 Hearing Date: November 27, 2024 Dept: 47

Tentative Ruling

Judge Theresa M. Traber, Department 47

HEARING DATE: November 27, 2024 TRIAL DATE: NOT SET

CASE: State of California v. Bruce E. Fishman, M.D.

CASE NO.: BC648395

(1) MOTION FOR SUMMARY ADJUDICATION

(2) MOTION FOR SUMMARY JUDGMENT OR, IN THE ALTERNATIVE, SUMMARY ADJUDICATION

MOVING PARTY: (1) Plaintiffs State of California, the Counties of Los Angeles, Kern, San Bernardino, Ventura, Santa Barbara, the Cities of Los Angeles and Bakersfield, the School Districts of Los Angeles, McFarland, Visalia and Kern, the Health Care District of Tehachapi, ex rel. Med-Legal Associates, Inc. and CLCI, Inc; (2) Defendants Bruce E. Fishman, M.D., Bruce E. Fishman, M.D., FISC, Inc. and Family Urgent Care & Industrial Medical Clinic, Inc

RESPONDING PARTY(S): (1) Defendants Bruce E. Fishman, M.D., Bruce E. Fishman, M.D., FISC, Inc. and Family Urgent Care & Industrial Medical Clinic, Inc; (2) Plaintiffs State of California, the Counties of Los Angeles, Kern, San Bernardino, Ventura, Santa Barbara, the Cities of Los Angeles and Bakersfield, the School Districts of Los Angeles, McFarland, Visalia and Kern, the Health Care District of Tehachapi, ex rel. Med-Legal Associates, Inc. and CLCI, Inc

CASE HISTORY:

· 01/27/17: Complaint filed under seal.

· 11/06/17: Order lifting seal entered.

· 12/22/17: First Amended Complaint filed under seal. (Not on eCourt, but attached as exhibit to a filing.)

· 02/17/21: Judgment on the Pleadings

· 02/22/21: Appeal filed by School Districts of Los Angeles, McFarland, et al. and GLC Operations, Inc., et al.

· 03/16/23: Remittitur filed, judgment reversed.

STATEM/ENT OF MATERIAL FACTS AND/OR PROCEEDINGS:

This is a qui tam action alleging that Defendant Bruce E. Fishman lied on his application (concealing a felony conviction) to serve as a qualified medical evaluator (“QME”) in connection with the examination of injured workers for purposes of their eligibility for workers’ compensation benefits. Plaintiffs allege that Defendants billed Plaintiffs for medical evaluation services Defendant Fishman unlawfully performed under the pretense of being a validly appointed QME and collected public funds for these services.

Plaintiffs, through the relators, move for summary adjudication of the first cause of action for violation of the California Insurance Frauds Prevention Act. Defendants move for summary judgment, or, in the alternative, summary adjudication of all remaining causes of action.

TENTATIVE RULING:

Plaintiffs’ Motion for Summary Adjudication is DENIED.

Defendants’ Motion for Summary Judgment, or, in the alternative, Summary Adjudication is DENIED.

DISCUSSION:

Plaintiffs’ Motion for Summary Adjudication

Plaintiffs, through the relators, move for summary adjudication of the first cause of action for violation of the California Insurance Frauds Prevention Act.

Legal Standard

The function of a motion for summary judgment or adjudication is to allow a determination as to whether an opposing party can show evidentiary support for a pleading or claim and, if not, to enable an order of summary dismissal without the need for trial. (Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826, 843.) Code of Civil Procedure Section 437c(c) “requires the trial judge to grant summary judgment if all the evidence submitted, and ‘all inferences reasonably deducible from the evidence’ and uncontradicted by other inferences or evidence, show that there is no triable issue as to any material fact and that the moving party is entitled to judgment as a matter of law.” (Adler v. Manor Healthcare Corp. (1992) 7 Cal.App.4th 1110, 1119.) “The function of the pleadings in a motion for summary judgment is to delimit the scope of the issues; the function of the affidavits or declarations is to disclose whether there is any triable issue of fact within the issues delimited by the pleadings.” (Juge v. County of Sacramento (1993) 12 Cal.App.4th 59, 67, citing FPI Development, Inc. v. Nakashima (1991) 231 Cal. App. 3d 367, 381-82.)

As to each claim as framed by the complaint, a plaintiff moving for summary judgment satisfies the initial burden to show that there is no defense to a claim by proving each element of the cause of action entitling the party to judgment. (Code Civ Proc. § 437c(p)(1).) Courts “liberally construe the evidence in support of the party opposing summary judgment and resolve doubts concerning the evidence in favor of that party.” (Dore v. Arnold Worldwide, Inc. (2006) 39 Cal.4th 384, 389.) The lack of opposition is not grounds to grant a motion for summary judgment if a defendant cannot meet their initial burden of proof. (See Thatcher v. Lucy Stores, Inc. (2000) 79 Cal.App.4th 1081, 1087.)

Once the plaintiff has met that burden, the burden shifts to the defendant to show that a triable issue of one or more material facts exists as to that cause of action or a defense thereto. (Code Civ. Proc. § 437c(p)(1).) To establish a triable issue of material fact, the party opposing the motion must produce substantial responsive evidence. (Sangster v. Paetkau (1998) 68 Cal.App.4th 151, 166.)

Plaintiffs’ Request for Judicial Notice

Plaintiffs request that the Court take judicial notice of (1) a July 15, 1983 Judgment and Probation Commitment Order in Case No. 83-60055-01 of the United States District Court for the Eastern District of Michigan; (2) an Indictment in United States of America v. Bruce Fishman, M.D., et al, Case No. 83-CR-60055 in the United States District Court for the Eastern District of Michigan filed on January 28, 1983; (3) a Complaint by the State of Michigan Department of Licensing and Regulation, Michigan Board of Medicine In the Matter of Bruce E. Fishman, M.D.; (4) the Consent Order and Stipulation in the Board of medicine matter; a series of reappointment applications as a Qualified Medical Evaluator for Bruce E. Fishman, M.D., dated (5) 2007; (6) 2009; (7) 2011; and (8) 2013; (9) an Order Granting Petition for Writ of Mandate issued August 23, 2021 in Fishman v. Department of Industrial Relations, LASC Case No. 19STCP00911; and (10) the First Amended Complaint in this action.

Plaintiffs’ requests Nos. 1 through 4 and 9 through 10 are GRANTED pursuant to Evidence Code section 452(d). In so doing, the Court takes judicial notice only of the existence of these documents and not the factual truth of any averments contained within.

The remainder of Plaintiffs’ requests are DENIED as Plaintiffs have not demonstrated that these documents are official acts within the scope of Evidence Code section 452(c). This ruling is without prejudice to Plaintiffs’ reliance upon these materials in the same manner as any other admissible evidence.

Undisputed Factual History

Given the extraordinarily contentious nature of this litigation, the Court finds it necessary to set forth the underlying facts and the complex procedural history of this action.

On January 26, 1983, Defendant Bruce Fishman, M.D., was criminally charged in the United States District Court for the Eastern District of Michigan with conspiracy to distribute controlled substances in violation of 21 U.S. Code section 846. (Plaintiffs’ RJN Exh. 2.) Defendant Fishman pled guilty to the charge of conspiracy to distribute on July 14, 1983. (RJN Exh. 1.) Defendant Fishman’s license to practice medicine was subsequently revoked in the State of Michigan and the State of California. (See Remittitur, filed March 16, 2023 at p. 3.) In or about August 1989, Defendant Fishman successfully applied for probationary reinstatement of his California medical license. (Id.) Thereafter, in 1993, Defendant Fishman sought and obtained early termination of the probation, thus reinstating his certificate to practice law without restriction. (Id. pp. 3-4.) ¶ 17.) In 2003, Defendant Fishman applied for and received an appointment by the California Division of Workers’ Compensation to serve as Qualified Medical Examiner. (See FAC ¶ 20.) Defendant Fishman applied and obtained reappointment every two years between 2005 and 2013, inclusive, before allowing his appointment to lapse in 2014. (See FAC ¶¶ 20-21.) During that time, Defendant Fishman and his corporation allegedly served as QME, prepared relevant materials and reports, and collected bills for that effort. (See FAC ¶¶ 20-22.)

Procedural History

The procedural history of this qui tam action is intertwined with several other proceedings, and the Court finds it appropriate to provide some explanation of this history.

1. Arbitration Between Defendants and Relator Med-Legal Associates, Inc.

Med-Legal Associates, Inc., a relator in this action, brought a petition for arbitration against Defendant Fishman, asserting, in essence, that Defendant Fishman failed to disclose his criminal conviction to Med-Legal. (Remittitur p. 5.) Defendant presented crossclaims against Med-Legal. In February 2017, the arbitrator issued an award in favor of Defendant Fishman, which was confirmed by the trial court and upheld on appeal. (Id.)

2. The Instant Qui Tam Action

In January 2017, Med-Legal, GLC Operations, and the principal of both entities, Patrick Nazemi, filed the instant qui tam action against Defendants, alleging that Defendant lied on his QME application by concealing his 1983 conviction, thereby violating (1) the Insurance Frauds Prevention Act and (2) the False Claims Act. (See generally Complaint.) In December 2017, the First Amended Complaint was filed, asserting the same claims but excluding GLC Operations and Nazemi as relators, and adding GLCI as a new, separate relator. (See FAC.) On June 21, 2018, the Court overruled Defendants’ Demurrer as to the first cause of action but sustained the Demurrer without leave to amend as to the second cause of action, finding that the allegations in this action fell within the workers’ compensation exception to the False Claims Act. (June 21, 2018 Final Ruling.)

On July 23, 2020, the Court granted Defendants’ motion for judgment on the pleadings, finding that the first cause of action was barred by the 2017 arbitration award under the doctrine of collateral estoppel, and, separately, that the first cause of action was barred by the statute of limitations. (July 23, 2020 Minute Order.) Plaintiffs appealed, and the Court of Appeal reversed on March 16, 2023, holding (1) neither the arbitration nor the California Medical Board’s findings had preclusive effect on this action because neither concerned identical issues, and because there was no evidence that the relators were all in privity with the sole party to the arbitration; and (2) the statute of limitations did not bar this action because some subset of the QME claims submitted by Defendants fell within the limitations period. (Remittitur pp. 16-18.)

3. Suspension Action & Writ Proceeding

On April 19, 2018, the Division of Workers Compensation notified Defendants of its intent to suspend Defendant Fishman. (Plaintiffs’ RJN Exh. 9 p.4.) On March 15, 2019, the DWC suspended Defendant Fishman from participating in the workers’ compensation system, notwithstanding the contrary recommendation by a Hearing Officer. (Id.) Defendant Fishman thereafter petitioned for writ of mandate. (Id.) The Court rejected Defendant’s argument that Labor Code section 139.21, which mandates suspension of a physician from participation in the workers’ compensation system if they have been convicted of a crime that is “substantially related to the qualifications, functions, or duties of a provider of services” (subd. (a)(1)(A)(iv)), violated Defendant’s due process rights, concluding that suspension from participation in the workers’ compensation system was not a constitutionally protected right. (RJN Exh. 9 pp.7-8.) The Court also declined to read into the statute a requirement for proof of unfitness to practice medicine before ordering a suspension. (Id.) The Court nevertheless found that the temporal aspect of Defendant Fishman’s conviction, including its remoteness in time, was relevant to whether the crime was “substantially related to the qualifications, functions, or duties of a provider of services,” and, therefore, the DWC’s refusal to consider that aspect constituted a prejudicial abuse of discretion. (RJN Exh. 9 pp. 10-12.) Consequently, the Court granted the petition for writ of mandate and set aside the decision suspending Defendants from participating in the workers’ compensation system. (RJN Exh. 9 p. 16.)

Analysis

Plaintiffs seek summary adjudication of the first cause of action for violation of the Insurance Frauds Prevention Act on the grounds that the undisputed facts purportedly establish that Defendant Brue E. Fishman, M.D. committed fraud within the definition of the Act.

In their zeal to pursue the argument that Defendant Fishman committed a felony related to his medical practice which should have disqualified him from serving as a Qualified Medical Examiner under the Workers’ Compensation program, Plaintiffs neglect to set forth the statutory elements for a fraud cause of action under the Insurance Frauds Prevention Act. As the Act is the basis for Defendant Fishman’s alleged liability, any analysis of the merits of the case must begin with the operative statutes.

As relevant to this motion, Plaintiffs’ first cause of action in the First Amended Complaint asserts a violation of Penal Code section 550 which gives rise to civil liability under the Insurance Frauds Prevention Act, codified at Insurance Code section 1871.7. (RJN Exh. 10 [FAC] ¶ 43.) Subdivision (b) of Insurance Code section 1871.7 establishes civil penalties for any person who violates, inter alia, Penal Code section 550. (Ins. Code § 1871.7(b).) Subdivision (e) permits any interested party to bring a civil action for violation of section 1871.7, including subdivision (b), on their own behalf and on behalf of the State of California. (Id. subd. (e).) Penal Code section 550, on which Defendant’s substantive liability is premised, states, in relevant part:

(a) It is unlawful to do any of the following, or to aid, abet, solicit, or conspire with any person to do any of the following:

(1) Knowingly present or cause to be presented any false or fraudulent claim for the payment of a loss or injury, including payment of a loss or injury under a contract of insurance.

[. . .]

(5) Knowingly prepare, make, or subscribe any writing, with the intent to present or use it, or to allow it to be presented, in support of any false or fraudulent claim.

(6) Knowingly make or cause to be made any false or fraudulent claim for payment of a health care benefit.

[. . .]

(10) For purposes of paragraphs (6) to (9), inclusive, a claim or a claim for payment of a health care benefit also means a claim or claim for payment submitted by or on the behalf of a provider of any workers’ compensation health benefits under the Labor Code.

(b) It is unlawful to do, or to knowingly assist or conspire with any person to do, any of the following:

(1) Present or cause to be presented any written or oral statement as part of, or in support of or opposition to, a claim for payment or other benefit pursuant to an insurance policy, knowing that the statement contains any false or misleading information concerning any material fact.

(2) Prepare or make any written or oral statement that is intended to be presented to any insurer or any insurance claimant in connection with, or in support of or opposition to, any claim or payment or other benefit pursuant to an insurance policy, knowing that the statement contains any false or misleading information concerning any material fact.

(Pen. Code § 550 (a)(1), (5)-(6), (10); (b)(1)-(2) [emphasis added].)

For Plaintiffs and Defendants, the central issue in this case is whether Defendant Fishman’s 1983 conviction for conspiracy to distribute controlled substances constituted a conviction for a felony related to Defendant’s medical practice which would disqualify Defendant Fishman from serving as a QME under Labor Code section 139.2(b) and section 10(c) of title 8 of the Code of Regulations. (Labor Code § 139.2(b) [setting minimum statutory qualifications and delegating rulemaking power to administrator]; Cal. Code Regs. Tit. 8 § 10(c) [“No physician who has been convicted of a felony or misdemeanor related to his or her practice shall be appointed or reappointed as a QME.”].) Plaintiffs argue vociferously in the affirmative, relying on the broad language in the enacting statute and the regulations, and on the factual claims in the indictment involving the operation of a sham clinic for the purpose of issuing and filling prescriptions for controlled substances. (Separate Statement of Undisputed Material Fact Nos. 4-28.) Defendants argue, between insults and opprobrium toward the relators and their counsel, with equal vehemence for the opposite position, relying principally on the text of the indictment alleging that Defendant Fishman conspired to distribute controlled substances ‘by issuing and filling prescriptions for said drug outside the usual course of medical practice and for no legitimate medical purpose.” (See RJN Exh. 2. p.2.) Plaintiffs omit this language in their recitation of the charges. As an officer of the Court, Plaintiff’s counsel has an ethical duty of candor not to knowingly misstate facts to this tribunal. (Cal. Rules of Prof. Conduct Rule 3.3(a).) This key language should have been disclosed in Plaintiffs’ moving papers, and Plaintiffs’ failure to do so does not reflect well on Plaintiffs’ counsel.

That said, the Court need not resolve the nature of Defendant Fishman’s conviction at this juncture because no resolution would be sufficient to carry Plaintiffs’ burden on summary adjudication. If the conviction is not related to Defendant Fishman’s practice, then, naturally, Defendant Fishman’s representations in (a) applying and reapplying for QME status and (b) submitting claims on which he represented that he was a QME were true and per se not fraudulent with respect to his QME status. However, assuming arguendo that the conviction was related to his practice, Plaintiffs would still be required by the plain text of Penal Code section 550 to establish that Defendant Fishman knew that the conviction was related to his practice and therefore disqualified him from serving as a QME. Plaintiffs offer no evidence in connection with this motion which goes to Defendant Fishman’s mental state, and, for that reason, have failed to carry their burden on summary adjudication.

Conclusion

Accordingly, Plaintiffs’ Motion for Summary Adjudication is DENIED.

Motion for Summary Judgment or Summary Adjudication

Defendants move for summary judgment or summary adjudication.

In bringing a motion for summary judgment or summary adjudication, the supporting papers must include “a separate statement setting forth plainly and concisely all material facts that the moving party contends are undisputed.” (Code Civ. Proc. § 437c(b)(1).) “The requirement of a separate statement from the moving party and a responding statement from the party opposing summary judgment serves two functions: to give the parties notice of the material facts at issue in the motion and to permit the trial court to focus on whether those facts are truly undisputed.” (Parkview Villas Assn., Inc. v. State Farm Fire & Casualty Co. (2005) 133 Cal.App.4th 1197, 1210.) A Separate Statement must separately identify not only each cause of action, claim for damages, issue of duty, or affirmative defense that is the subject motion but “each supporting material fact claimed to be without dispute with respect to the cause of action.” (Cal. Rule of Court 3.1350(d)(1)-(2)[emphasis added].) Subsection (h) of Rule 3.1350 sets forth the format required for a Separate Statement, including the two-column format, where the first column contains the movant’s stated material facts and the evidence in support, while leaving the second column blank for the opposing party’s response. (Rule 3.1350(h).)

Defendants’ motion complies with none of these requirements. The Separate Statement does not separately identify each material fact claimed to be without dispute as to each issue on the motion and instead incorporates other material facts by reference. The Separate Statement also entirely fails to follow the two-column requirement set forth in the Rules of Court. Rather, Defendants have elected to set forth “undisputed facts” in one column and the “Source of Undisputed Fact” in the other, in direct contravention of the Rules of Court. More gravely, rather than setting forth facts and evidence in the manner contemplated by and exemplified in the Rules of Court, Defendants have filled their Separate Statement with inappropriate legal arguments and irrelevant and uncivil attacks on the opposing party. In no respect is this a proper Separate Statement of Undisputed Material Fact.

The failure to provide a separate statement is, in the Court’s discretion, grounds for denial of the motion. (Code Civ. Proc. § 437c(b)(1).) Moreover, appellate precedent has consistently encouraged trial courts to require strict compliance with the requirements for separate statements. (United Community Church v. Garcin (1991) 231 Cal.App.3d 327, 335 [superseded by statute on other grounds]; North Coast Business Park v. Nielsen Construction Co. (1993) 17 Cal.App.4th 22, 30-32.) As the Court of Appeal for the Fourth District bluntly stated this past December, “[t]rial courts should not hesitate to deny summary judgment motions when the moving party fails to draft a compliant separate statement.” (Beltran v. Hard Rock Hotel Licensing, Inc. (2023) 97 Cal.App.5th 865, 876.) This Court will heed that instruction.

Conclusion

Accordingly, Defendants’ Motion for Summary Judgment, or, in the alternative, Summary Adjudication is DENIED.

CONCLUSION:

Accordingly, Plaintiffs’ Motion for Summary Adjudication is DENIED.

Defendants’ Motion for Summary Judgment, or, in the alternative, Summary Adjudication is DENIED.

Moving Parties to give notice.

IT IS SO ORDERED.

Dated: November 26, 2024 ___________________________________

Theresa M. Traber

Judge of the Superior Court

Any party may submit on the tentative ruling by contacting the courtroom via email at Smcdept47@lacourt.org by no later than 4:00 p.m. the day before the hearing. All interested parties must be copied on the email. It should be noted that if you submit on a tentative ruling the court will still conduct a hearing if any party appears. By submitting on the tentative you have, in essence, waived your right to be present at the hearing, and you should be aware that the court may not adopt the tentative, and may issue an order which modifies the tentative ruling in whole or in part.