State of California v. Fishman CA2/2 ( 2022 )

Filed 12/6/22 State of California v. Fishman CA2/2
NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS
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IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
SECOND APPELLATE DISTRICT
DIVISION TWO
STATE OF CALIFORNIA et al., B307407
(c/w B310195, B311594)
Plaintiffs and Appellants,
(Los Angeles County
v. Super. Ct. No. BC648395)
BRUCE E. FISHMAN et al.,
Defendants and Respondents;
PATRICK NAZEMI et al.,
Objectors and Appellants.
APPEAL from a judgment of the Superior Court of
Los Angeles County. Randolph W. Hammock, Judge. Reversed.
The Tym Firm and Ronald D. Tym for Plaintiffs and
Appellants.
Klapach & Klapach and Joseph S. Klapach for Objectors
and Appellants.
Law Offices of Howard A. Kapp and Howard A. Kapp for
Defendants and Respondents.
______________________________
This appeal is just one slice of contentious litigation
between appellants Patrick Nazemi (Nazemi), GLC Operations,
Inc. (GLC Operations), and Med-Legal Associates, Inc. (Med-
Legal), and GLCI, Inc. (GLCI),1 and respondents Dr. Bruce E.
Fishman (Dr. Fishman) and his medical entity, Bruce E.
Fishman, M.D., FICS, Inc. (collectively Fishman). The appeal
concerns three issues resulting from the judgment in the
underlying qui tam action: (1) The propriety of the trial court’s
order granting Fishman’s motion for judgment on the pleadings;
(2) Whether the trial court abused its discretion in awarding
Fishman attorney fees; and (3) The correctness of the trial court’s
order adding Nazemi and GLC Operations as judgment debtors.
We conclude that the trial court erroneously granted
Fishman’s motion for judgment on the pleadings. We therefore
reverse the judgment. It follows that appellants’ challenges to
1
Appellants are broken down into two categories: the
objectors (Nazemi and GLC Operations) and the relators (Med-
Legal and GLCI). “A ‘relator’ has been described thus: ‘The real
party in interest in whose name a state or an attorney general
brings a lawsuit.’” (People ex rel. Allstate Ins. Co. v. Weitzman
(2003) 107 Cal.App.4th 534, 538, capitalization omitted.)
2
(1) the award of attorney fees, and (2) order adding Nazemi and
GLC Operations to the judgment as judgment debtors are moot.2
FACTUAL AND PROCEDURAL BACKGROUND
Dr. Fishman’s Criminal Conviction
In 1983, while he was a medical resident, Dr. Fishman was
named in a Michigan federal indictment; he later pled guilty to a
single count of conspiracy to distribute a controlled substance
pursuant to 21 United States Code section 846. As a result, his
medical license had been revoked in both California and
Michigan. (Med-Legal Associates, Inc. v. Fishman (Mar. 8, 2019),
B284731 [nonpub. opn.], pp. *3–*4.)
Medical Board of California Reinstates Dr. Fishman’s License
In or about August 1989, Dr. Fishman applied to the
Medical Board of California (Medical Board) for reinstatement of
his California medical license. Ultimately, the Medical Board
determined that Dr. Fishman had “established that he is
sufficiently rehabilitated so that it would not be adverse to the
public interest to restore [his] certificate in a probationary
status.” Thus, the Medical Board reinstated Dr. Fishman’s
certificate to practice medicine for a probationary period of five
years.
In 1993, Dr. Fishman applied for early termination of the
five-year probation. The administrative law judge (ALJ) lifted all
restrictions from Dr. Fishman’s license, noting: “As a very young
man, [Dr. Fishman] engaged in a criminal activity. He has
2
We express no opinion on those orders, and nothing herein
precludes the trial court from later awarding Fishman attorney
fees and adding Nazemi and GLC Operations as judgment
debtors.
3
served his prison sentence and completed parole. He has
successfully returned to medical practice and has complied with
all of the terms of his probation. [¶] [He] has worked so hard to
rebuild his professional life, and his profession is so important to
him, that it is highly improbable that he would ever again engage
in any activity, including criminal conduct, which would
jeopardize that profession. [¶] [He] has demonstrated that he
has the professional and ethical qualifications required of a
departmental licensee and that he is capable of practicing
medicine without special restriction.” Thus, probation was lifted
and his certificate was reinstated without restriction.
Dr. Fishman Becomes a Qualified Medical Examiner (QME)
In 2003, Dr. Fishman applied to the Department of
Industrial Relations (DIR) Division of Workers’ Compensation to
become a QME. (Lab. Code, § 139.2.) Dr. Fishman was
appointed to be a QME and then reappointed several times
thereafter.
Business Relationship Between Fishman and Nazemi
In 2008, Dr. Fishman entered into a relationship with
Green Lien Collections, Inc., a company owned by Nazemi. In
2011, Nazemi formed Med-Legal “‘with the intent to provide
management services to med-legal providers.’” (Med-Legal
Associates, Inc. v. Fishman, supra, B284731, at p. *2.) Effective
November 1, 2012, Med-Legal and Fishman entered into a
management services agreement. During the first year of that
agreement, the relationship between Dr. Fishman and Med-Legal
deteriorated. (Id. at p. *2.)
4
Procedural History
At this point, three relevant separate and independent
procedural timelines begin.3
A. Arbitration between Fishman and Med-Legal
Med-Legal, represented by Mr. Tym, filed a petition for
arbitration against Fishman, and Fishman filed a cross-claim
against Med-Legal. (Med-Legal Associates, Inc. v. Fishman,
supra, B284731, at p. *5.) The gist of Med-Legal’s claim was that
Dr. Fishman failed to disclose his criminal conviction to Med-
Legal. (Id. at pp. *4–*5.) After a five-day hearing, in February
2017, the arbitrator issued a final award in favor of Fishman.
(Id. at pp. *5, *8.) Med-Legal’s petition to vacate the arbitration
award was denied, and judgment was entered in favor of
Fishman. (Id. at pp. *11, *13.) Med-Legal appealed, and on
March 8, 2019, we affirmed the judgment. (Id. at p. *1.)
B. Qui Tam Action
1. Pleadings
While the arbitration was pending, in January 2017,
Nazemi, GLC Operations, and Med-Legal, represented by
Mr. Tym, filed the instant qui tam action against Fishman,
alleging that Dr. Fishman lied on his application (concealing a
felony conviction) to serve as a QME in connection with the
examination of injured workers for purposes of eligibility for
workers’ compensation benefits. The original relators asserted
claims under the Insurance Frauds Prevention Act (IFPA) (Ins.
Code, § 1871 et seq.) and the False Claims Act (Gov. Code,
3
For the sake of completeness, we note that while all of
these actions were progressing, on October 21, 2019, Med-Legal,
represented by Ronald D. Tym, also filed an action in federal
court against Fishman.
5
§ 12650 et seq.). In October 2017, the Insurance Commissioner
and Attorney General declined to intervene.
Nearly one year later, in December 2017, the operative first
amended complaint (FAC) was filed by Mr. Tym. The FAC
asserted claims for violation of the IFPA and the False Claims
Act. Under the FAC, Med-Legal and a new relator, GLCI, were
the only relators. Nazemi and GLC Operations were not named
as relators in this pleading.
The FAC alleges, in relevant part, that Fishman violated
the IFPA between 2003 and 2014 by improperly seeking and
obtaining payment for medical reports that Dr. Fishman
prepared while he was acting as a “purported QME.” He never
should have been a QME because he fraudulently hid his
criminal conviction from the DIR Division of Workers’
Compensation.
The FAC further alleges that “[e]ach time that a billing
statement or medical legal report of Fishman was submitted to
the insurance companies in support of a payment, the Defendant
[was] submitting or causing the submission of the billing
statement and medical legal report made the implied certification
that Fishman lawfully qualified for participation in the workers
compensation system as a QME.”
Fishman demurred to the FAC. In June 2018, the trial
court overruled his demurrer to the first cause of action for
violation of the IFPA and sustained the demurrer without leave
to amend to second cause of action for violation of the False
Claims Act. As is relevant to the issues in this appeal, the trial
court found that the doctrines of res judicata and collateral
estoppel did not apply to the arbitrator’s award because it was
not yet final—Med-Legal had filed a motion to vacate the award,
6
which was denied, and Med-Legal’s appeal of that order was
pending.
2. Judgment on the Pleadings
a. Fishman’s motion
On June 16, 2020, Fishman filed a motion for judgment on
the pleadings, seeking dismissal of the sole remaining cause of
action for violation of the IFPA. Because the judgment in the
arbitration action was now final, Fishman argued that the claim
was barred by res judicata and collateral estoppel. Alternatively,
Fishman asserted that the Medical Board’s findings collaterally
estopped the relators from pursuing this action.
Separately, Fishman argued that the cause of action was
time-barred. In support, Fishman directed the trial court to
Insurance Code section 1871.7, subdivision (l), which provides, in
relevant part: “(1) An action pursuant to this section may not be
filed more than three years after the discovery of the facts
constituting the grounds for commencing the action. [¶]
(2) Notwithstanding paragraph (1) no action may be filed
pursuant to this section more than eight years after the
commission of the act constituting a violation of this section or a
violation of Section 549, 550, or 551 of the Penal Code.” (Ins.
Code, § 1871.7, subd. (l).) Because 2003, the year Dr. Fishman
was certified as a QME, is more than eight years before 2017, the
year this lawsuit was filed, it was time-barred.
b. Relators’ opposition
The relators opposed the motion, arguing, among other
things, that collateral estoppel did not apply. The prior
arbitration involved different parties (the State of California was
not a party to that action) and a different cause of action
(violation of the IFPA was not alleged in that action). Regarding
7
the Medical Board findings, the relators noted that (1) the
Medical Board never found that the felony was not related to the
practice of medicine (Lab. Code, § 139.21), and (2) the Medical
Board never considered whether Dr. Fishman had made any
misrepresentations on his application to the DIR Division of
Workers’ Compensation.
In response to Fishman’s statute of limitations argument,
the relators argued that the date Dr. Fishman allegedly made his
misrepresentation (2003) did not start the clock. Rather,
pursuant to Insurance Code section 1871.7, subdivision (b),4 and
as alleged in the FAC, “[e]ach billing statement and medical-legal
report submitted by [Fishman] to insurance companies or self-
insured employers constitute[s] a separate offense under the
[IFPA], and therefore the statute of limitations is measured by
the submission date of each such billing statement and medical
legal report.”
c. Trial court order
After entertaining oral argument, the trial court granted
Fishman’s motion for judgment on the pleadings, finding that the
sole remaining cause of action was barred by the doctrine
collateral estoppel. After all, the confirmed arbitration award
against Med-Legal and in favor of Fishman was final; Med-Legal
was the plaintiff in that action; and the arbitration determined
the same issues as in the qui tam action. Specifically, in the
arbitration, Med-Legal asserted that Dr. Fishman committed
4
The subdivision provides, in relevant part: “The penalty
prescribed in this paragraph shall be assessed for each
fraudulent claim presented to an insurance company by a
defendant and not for each violation.” (Ins. Code, § 1871.7, subd.
(b).)
8
fraud by not reporting his felony conviction when he obtained his
certification as a QME. “The basis for [this] lawsuit—the
primary right that Relator alleges in this suit—is the same as the
earlier arbitration for purposes of res judicata and collateral
estoppel.”
Separately, the trial court found that the claim was barred
by the statute of limitations.
Although not necessary for the trial court’s ruling, the trial
court felt compelled to point out that “Dr. Fishman was not
convicted of any felony ‘related to his medical practice.’ Rather,
the federal indictment in which he was named states that he was
charged with distributing controlled substances ‘outside the
usual course of medical practice and for no legitimate medical
purpose.’ [Citation.] Dr. Fishman pled guilty to a violation of
21 U.S.C. § 846, conspiracy to commit a drug offense (specifically,
conspiracy to distribute narcotics and non-narcotic controlled
substances). [Citation.] [Fishman has] not cited any authorities
regarding how the [DIR—Division of Workers’ Compensation]
interprets the phrase ‘felony or misdemeanor related to his or her
practice’ in 8 CCR § 10(c). However, it is clear that the actual
indictment and conviction do not establish that the felony was
related to Dr. Fishman’s medical practice. In addition, even with
all of the information about his conviction, once Dr. Fishman had
successfully completed [his] probationary period in which his
license was revoked, it was reinstated without restriction.
[Citation.] The ALJ found, in that decision, that Dr. Fishman
had ‘demonstrated that he has the professional and ethical
qualifications required of a departmental licensee and that he is
capable of practicing medicine without special restriction.’
[Citation.] The ALJ also noted that Dr. Fishman had ‘worked so
9
hard to rebuild his professional life, and his profession is so
important to him, that it is highly improbable that he would ever
again engage in any activity, including criminal conduct, which
would jeopardize that profession.’ [Citation.]
“Based on these findings that Dr. Fishman was fully
rehabilitated and entitled to practice medicine with no
restrictions, the State of California would have no basis on which
to prevent him from being certified as a QME. In addition, the
Medical Board of California records clearly indicate that
Dr. Fishman had been on probation. [Citations.] [Fishman]
declare[s] that this information was obtained from the
Department of Industrial Relations itself. [Citation.] Regardless,
the document demonstrates that this information was readily
available through the Medical Board of California website, and
therefore readily available to the [Department of Industrial
Relations—Division of Workers’ Compensation], yet the agency
never disqualified Dr. Fishman and continued to renew his QME
applications.”
The trial court concluded with the following observations:
“Ultimately, one lesson emerges from a review of the history of
this case and the many other cases in which the Relator sought
damages from Dr. Fishman: persistence is one thing; persecution
is another. Unfortunately, this case goes well beyond persistence
into the realm of persecution.
“Qui tam actions were authorized in the State of California
to ‘promote the public interest’ of its citizens—not to unjustly
harass and persecute others with a personal vendetta, nor to
attempt to unjustly line the pockets of unscrupulous lawyers.
The instant case, as well as its underlying California proceedings,
has not served or protected our fellow citizens at all. Indeed, it
10
has had the opposite effect by needlessly wasting the valuable
resources of our courts and various administrative bodies. It is
time to put this sad and pathetic litigation to an end.
“Enough is enough.” (Fns. omitted.)
In a footnote, the trial court added: “Of course, given the
custom and practice of the Plaintiffs’ counsel, this particular
litigation is unlikely to actually end until the U.S. Supreme Court
summarily denies his petition for certiorari.”
3. Judgment and Objections
On August 24, 2020, judgment was entered in favor of
Fishman and against Med-Legal, GLC Operations, Nazemi, and
GLCI.
On December 28, 2020, Nazemi and GLC Operations,
through their attorneys Jenkins Kayayan, objected to the
judgment on the grounds that they were not parties to the action
and had not received notice that judgment was going to be
entered against them.
Nazemi also offered a declaration asserting that the three
entities (GLCI, Med-Legal, & GLC Operations) were not alter
egos of one another, nor was he the alter ego of any such entity.
4. Attorney Fees
On February 2, 2021, the trial court awarded Fishman
attorney fees. In so ruling, the trial court acknowledged that “at
the time the judgment was entered on 8/24/20 it was not this
Court’s intention to have had Patrick Nazemi and/or GLCI, Inc.
included in the judgment, as they were included in error by this
Court at that time. Simply put: Neither were existing parties to
11
this case at that time.”5 In light of that error, and the objections
to the judgment, the trial court treated those objections “as a
motion to correct the judgment by striking them as judgment
debtors, or in the alternative, to determine whether they should
be properly added as judgment debtors, under this Court’s
general powers” pursuant to Code of Civil Procedure section 187.
It then noted that “all interested parties were given ample
opportunity to address the issue as to whether [the objectors]
should, in essence, be judgment debtors in this case at this time.”
After reviewing the parties’ briefs and arguments, the trial court
denied the objectors’ motion to correct the judgment, noting
reasoning: “This Court has no doubt whatsoever that
Mr. Nazemi (and all of his shell/alter-ego corporations) is the
primary instigator and the actual de facto person who
‘maintained’ and prosecuted this entire case. There is ample
evidence that demonstrates this fact, certainly by a
preponderance of the evidence, if not even at a higher standard of
proof. Quite tellingly, Mr. Nazemi never even proffered any
explanation whatsoever, and certainly no reasonable or
believable one, as to why he suddenly (and procedurally
defectively) withdrew from this case after he filed it. Is it
perhaps to be able to assert the objections and/or arguments he is
making now to prevent him from being personally responsible for
any attorney’s fees or costs in this case?
5
Although the trial court indicated that it did not intend to
include Nazemi and/or GLCI in the judgment, we assume it
meant Nazemi and/or GLC Operations, as GLCI was a named
relator in the FAC.
12
“Given the totality of the circumstances of this case, as well
as the matters of which this Court has previously taken judicial
notice, it is in the clear interests of justice, and within the ‘spirit
of the code,’ to acknowledge reality: Patrick Nazemi was the
primary and substantial instigator and maintainer of this lawsuit
from beginning to end. He should not be allowed to escape his
well-deserved responsibility for the reasonable attorney’s fees
and costs incurred by the victims of this specious and malicious
lawsuit.”
The trial court awarded attorney fees to Fishman and
against all four appellants in the amount of $197,500.
5. Appeals
These timely appeals ensued.
C. Suspension Case
Meanwhile on November 21, 2017, Mr. Tym sent a letter to
the Division of Workers’ Compensation, expressing his “surprise[]
that the [it] ha[d] to date not taken any action to suspend
Dr. Bruce Fishman . . . from participation in the workers’
compensation system.”
We do not know if that letter is what prompted action by
the agency. But, on April 19, 2018, the DIR Division of Workers’
Compensation notified Dr. Fishman of its intent to suspend him
from the workers’ compensation system. Thereafter,
Dr. Fishman’s controlled entities were suspended as well.
The matter proceeded to a hearing before an ALJ, who
found in favor of Dr. Fishman. The ALJ concluded that
Dr. Fishman’s “1983 conviction did not violate Labor Code section
139.21 as [his] conduct was not substantially related to the
qualifications, functions or duties of a provider of services, during
13
his tenure as a physician in the California workers’ compensation
system since May 7, 1990.”
Just nine days after the ALJ issued her decision, the
administrative director of the Division of Workers’ Compensation
rejected the ALJ’s findings and suspended Fishman. Fishman
filed a petition for writ of mandate, asking the trial court to set
aside the adverse decision. Two years later (following a remand
to the administrative director), in August 2021, the trial court
granted Fishman’s petition for writ of mandate and set aside the
DIR’s suspension order. In so ruling, the trial court found that
the DIR “prejudicially abused its discretion by failing to consider
all relevant facts in connection with its determination of
[Dr. Fishman’s] crime is substantially related to the qualification,
functions and duties of a provider of services in the workers’
compensation system. By failing to consider all relevant facts—
not just the crime—[the DIR] failed to proceed as required by
law.”
DISCUSSION
The threshold issue on appeal is whether the trial court
properly granted Fishman’s motion for judgment on the pleadings
pursuant to either the doctrine of collateral estoppel or the
statute of limitations.
I. Standard of review
“‘The standard of review for a motion for judgment on the
pleadings is the same as that for a general demurrer: We treat
the pleadings as admitting all of the material facts properly
pleaded, but not any contentions, deductions or conclusions of
fact or law contained therein. . . . We review the [operative
pleading] de novo to determine whether it alleges facts sufficient
to state a cause of action under any theory. [Citation.]’
14
[Citation.]” (Burd v. Barkley Court Reporters, Inc. (2017) 17
Cal.App.5th 1037, 1042.)
That said, “courts will not close their eyes in situations
where a complaint contains allegations of fact inconsistent with
attached documents/exhibits, or allegations contrary to facts
which are judicially noticed. [Citation.] Where facts appearing
in attached exhibits or judicially noticed documents contradict, or
are inconsistent with, the complaint’s allegations, we must rely
on the facts in the exhibits and judicially noticed documents.”
(Genis v. Schainbaum (2021) 66 Cal.App.5th 1007, 1015.)
II. Collateral estoppel
Applying these legal principles, we conclude that the trial
court erred in applying the doctrine of collateral estoppel when it
granted Fishman’s motion for judgment on the pleadings.
A. Relevant law
Collateral estoppel “precludes relitigation of issues argued
and decided in prior proceedings.” (Hernandez v. City of Pomona
(2009) 46 Cal.4th 501, 511.) The doctrine applies if five elements
are met: (1) the issue sought to be precluded from relitigation is
identical to that decided in a former proceeding; (2) the issue was
actually litigated in the former proceeding; (3) the issue was
necessarily decided in the former proceeding; (4) the decision in
the former proceeding was final and on the merits; and (5) the
party against whom preclusion is sought must be the same as, or
in privity with, the party to the former proceeding. (Ibid.) “If
judicially noticed records of prior litigation show the complaint is
barred by collateral estoppel, the [motion for judgment on the
pleadings] may be [granted].” (Groves v. Peterson (2002) 100
Cal.App.4th 659, 667.)
15
B. Analysis
Here, Fishman asserts two grounds in support of the
assertion that collateral estoppel applies: (1) the arbitration
decision against Med-Legal, and (2) the Medical Board’s findings.
Based upon the arguments presented and the appellate record,
we cannot adopt either argument.
Regarding the arbitration decision, there are at least two
elements of collateral estoppel not satisfied. First, it is unclear
whether the issue in the qui tam proceeding is the same as the
one at issue in the arbitration case. As set forth in our prior
opinion, the issue in the arbitration case was Dr. Fishman’s
alleged failure to disclose his prior felony conviction to Med-
Legal. (See Med-Legal Associates, Inc. v. Fishman, supra,
B284731, at pp. *4–*5.) But the issue in this case is whether
Dr. Fishman lied to the DIR Division of Workers’ Compensation
on his application to become a QME. While they sound similar,
they are not identical.
Second, there is no evidence that Med-Legal was in privity
with GLCI or the objectors. Understandably, the trial court
seems to have made this assumption. After all, GLC Operations
(a relator in the original complaint) and GLCI, Inc. (a relator in
the FAC), share the same initials, initials that mirror Green Lien
Collections, Inc., a company owned by Nazemi. (See Med-Legal
Associates, Inc. v. Fishman, supra, B284731, at p. *1.) Nazemi
also was the individual who formed Med-Legal (id. at p. *2) and
is still its Chief Executive Officer. Nazemi also is an officer of
GLC Operations. No other individual has submitted a
declaration as a representative of these corporate entities.
Mr. Tym represents Med-Legal in multiple actions against
Fishman; he also represented Nazemi and GLC Operations as
16
qui tam plaintiffs in the original complaint, and he represents
GLCI in the FAC. While the lines appear blurred, at this point,
there is nothing presented in the appellate record to support the
trial court’s finding that appellants are all alter egos of one
another.
Regarding the Medical Board findings, again the issue in
this proceeding is different than the one the Medical Board
considered. The Medical Board reinstated Dr. Fishman’s license;
it did not consider he had “been convicted of a felony . . . related
to his . . . practice” (Cal. Code Regs., tit. 8, subd. (c)) or that he
made any misrepresentations on his application to be appointed a
QME.
III. Statute of limitations
A. Relevant law
The parties agree that Insurance Code section 1871.7
governs. As set forth above, subdivision (l) provides for either a
three-year or eight-year statute of limitations for claims arising
under the IFPA. It is undisputed that Dr. Fishman’s alleged
fraud occurred in 2003, outside this statutory period. The issue
presented is whether the date of Dr. Fishman’s alleged
misrepresentation starts the statutory period, or whether,
pursuant to subdivision (b), Fishman’s submission of each alleged
fraudulent claim or medical legal report controls.
To answer this question, “‘we apply well-established rules
of statutory construction. The goal of statutory construction is to
ascertain and effectuate the intent of the Legislature. [Citation.]
Often, the words of the statute provide the most reliable
indication of legislative intent. [Citation.] However, when the
statutory language is itself ambiguous, we must examine the
context in which the language appears, adopting the construction
17
that best harmonizes the statute internally and with related
statutes. [Citation.] “‘When the language is susceptible of more
than one reasonable interpretation . . . we look to a variety of
extrinsic aids, including the ostensible objects to be achieved, the
evils to be remedied, the legislative history, public policy,
contemporaneous administrative construction, and the statutory
scheme of which the statute is a part.’” [Citation.]’ [Citation.]”
(San Francisco Unified School Dist. ex rel. Contreras v. Laidlaw
Transit, Inc. (2010) 182 Cal.App.4th 438, 447.)
B. Analysis
Based upon the arguments presented below and on appeal,
we conclude that the relators are correct: The statute of
limitations identified in Insurance Code section 1871.7,
subdivision (l), is triggered by the submission of claims or
medical legal reports, not the date when Dr. Fishman allegedly
made false representations on his application to become a QME. 6
Subdivision (b) provides that “[t]he penalty prescribed in this
paragraph shall be assessed for each fraudulent claim presented
to an insurance company by a defendant and not for each
violation.” (Ins. Code, § 1871.7, subd. (b), italic added.)
Moreover, Penal Code section 550, subdivision (a)(1), mentioned
in Insurance Code section 1871.7, also refers to the presentation
of “fraudulent claim[s].” The statutes are silent concerning the
date of the alleged fraud underlying those submitted claims,
leaving us to conclude that the date of the alleged fraud is
6
In reaching this conclusion, we cannot ignore the barebones
argument made by Fishman in the respondents’ brief in defense
of the trial court’s determination.
18
irrelevant to the determination of when the statute of limitations
commences.
This interpretation is consistent with the purpose of
Insurance Code section 1871 et seq., which is to “prevent[] and
punish[] the making of fraudulent claims.” (State of California
ex rel. Nee v. Unumprovident Corp. (2006) 140 Cal.App.4th 442,
449.) As one court has held, “a straightforward reading of these
statutes makes clear that the class of persons who violate these
sections are those who submit false or fraudulent claims to
insurers.” (Id. at p. 450.) It follows that we must look at the
claims submitted, not the alleged underlying fraud, to determine
whether an action under the IFPA is timely.
The FAC alleges that Fishman submitted false medical
reports between 2003 and 2014. Because at least some of these
unlawful claims were submitted within the statutory period,
judgment on the pleadings should not have been entered. That
said, it may well be that some of the submitted claims for which
the relators seek penalties are time-barred. We do not address
this issue; we leave that to Fishman to raise below in the
appropriate format.
IV. Additional thoughts
We understand and are sympathetic to the trial court’s
obvious frustration with appellants and their lawyers in this
case.7 Numerous times, by multiple judges, they have been called
7
Appellants’ argument repeated suggestion
notwithstanding, there is zero evidence of any bias by the trial
court against any of the appellants.
19
out as needlessly contentious and unscrupulous.8 (See, e.g., Med-
Legal Associates, Inc. v. Fishman, supra, B284731, at p. *5.) And
the appellate record of this appeal and the prior one have the
earmarks of malice; it does seem that (1) Nazemi has a personal
vendetta against Dr. Fishman, (2) Nazemi is controlling the
corporate entities and directing the litigation, and (3) several
judicial or quasi-judicial entities that have weighed in on the
question of Dr. Fishman’s honesty have determined that, in that
particular case, he did not commit fraud. Unfortunately, given
the procedural posture of this case and based upon what is
presented in this appellate record, we cannot conclude that
judgment can be entered at this time.
It follows that we decline Fishman’s request for monetary
sanctions. But we caution all parties and their counsel that
monetary sanctions are always an option to both the trial court
and this court, not to mention a referral to the State Bar.
8
We note that Fishman’s respondents’ brief (not to mention
some briefs filed in the trial court) is rife with inflammatory
hyperbole and overkill in its critique of appellants’ arguments on
appeal. While we would like to think that such a reminder is
unnecessary, we emphasize to all parties and their attorneys that
“it is vital to the integrity of our adversary legal process that
attorneys strive to maintain the highest standards of ethics,
civility, and professionalism in the practice of law.” (People v.
Chong (1999) 76 Cal.App.4th 232, 243.) “Indeed, unwarranted
personal attacks on the character or motives of the opposing
party, counsel, or witnesses are inappropriate and may constitute
misconduct.” (In re S.C. 2006) 138 Cal.App.4th 396, 412.) It
should go without saying that unfounded attacks on and insults
to the trial court are never appropriate.
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In light of this conclusion, appellants’ challenge to the trial
court’s orders (1) awarding Fishman attorney fees, and (2) adding
the objectors as judgment debtors are moot. That said, nothing
herein should be construed as a finding that such determinations
would not be proper at a future time.
DISPOSITION
The judgment is reversed. Parties to bear their own costs
on appeal.
NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS.
_____________________, Acting P. J.
ASHMANN-GERST
We concur:
________________________, J.
CHAVEZ
________________________, J.
HOFFSTADT
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