Dominguez v. Bonta

Citation87 Cal.App.5th 389,303 Cal.Rptr.3d 115
Decision Date19 December 2022
Docket NumberF082053,F082208
Parties Tracy DOMINGUEZ et al., Plaintiffs and Appellants, v. Rob BONTA, as Attorney General etc., et al., Defendants and Respondents.
CourtCalifornia Court of Appeals

Carpenter, Zuckerman & Rowley; Carpenter & Zuckerman, Robert J. Ounjian ; and Nicholas C. Rowley, Beverly Hills, for Plaintiffs and Appellants.

Rob Bonta, Attorney General, Thomas S. Patterson, Assistant Attorney General, Anthony R. Hakl and Jerry T. Yen, Deputy Attorneys General, for Defendant and Respondent Rob Bonta as Attorney General.

Vanessa L. Holton, Robert G. Retana, San Francisco and Sean T. Strauss for Defendant and Respondent Ruben Duran as Chairman of the Board of Trustees of the State Bar of California.

Tucker Ellis, Traci L. Shafroth, San Francisco, and Aggie B. Lee, Los Angeles, for California Medical Association, California Dental Association, California Hospital Association and the American Medical Association as Amici Curiae on behalf of Defendants and Respondents.

Cole Pedroza, Kenneth R. Pedroza, Matthew S. Levinson and Cassidy C. Davenport, San Marino, for Anthony Allen, M.D., Bay Imaging Consultants Medical Group, Robert Binder, M.D., Cedars-Sinai Medical Center, Justin Davis, P.A., East Bay Neurospine, Kathryn Klima, M.D., Thomas J. Mampalam, M.D., Stuart Martin, M.D., Kathryn Sharma, M.D., Sutter Bay Hospitals, doing business as Alta Bates Summit Medical Center, Sara Vaughn, M.D., and Hans C. Yu, D.O., as Amici Curiae on behalf of Defendants and Respondents

PEÑA, J.

Tracy Dominguez, Ruben Xavier DeLeon and Carpenter, Zuckerman & Rowley (CZR) (collectively, plaintiffs) appeal from a judgment of dismissal after the trial court sustained, without leave to amend, a demurrer brought by Rob Bonta as the Attorney General of the State of California (the Attorney General), and joined by Ruben Duran,1 Chairman of the Board of Trustees of the State Bar of California (the Chairman) (collectively, demurring defendants).2

We affirm the judgment of dismissal.

FACTUAL AND PROCEDURAL BACKGROUND

On May 26, 2020, plaintiffs filed a complaint for declaratory and injunctive relief against the Attorney General, the Chairman, Mercy Hospital of Bakersfield (hospital), Arthur Park, M.D. (Dr. Park), and Hans C. Yu, D.O. (Dr. Yu). (Hospital, Dr. Park, and Dr. Yu are referred to collectively as healthcare defendants.) The facts and plaintiffs' contentions, as alleged in the complaint, follow.

Allegations in Appellant's Complaint

Healthcare defendants are the defendants in a separate medical malpractice case (medical malpractice case) brought by plaintiffs Tracy Dominguez and Ruben Xavier DeLeon (heirs) in which healthcare defendants are alleged to have provided negligent medical care to Demi Ruben Dominguez and Malakhi Ruben DeLeon (collectively, decedents) resulting in decedents' deaths.3 Heirs are alleged to be the wrongful death heirs of decedents. Heirs have suffered damages as a result of the alleged wrongful death of decedents, which "are primarily, if not entirely, noneconomic losses." CZR is a law firm that "exclusively represents injury victims in tort matters on a contingency basis." If successful on appeal of this matter, CZR seeks to represent heirs in the medical malpractice case.

In this action, plaintiffs challenge the constitutionality of two California statutesCivil Code section 3333.2, which caps the amount of damages a plaintiff may recoup for noneconomic losses at $250,000 ( Civ. Code, § 3333.2, subd. (b) ); and Business and Professions Code section 6146, which sets limits on the amount of contingency fees a law firm may charge in representing a plaintiff in a professional negligence action against a health care provider. ( Civ. Code, § 3333.2 and Bus. & Prof. Code, § 6146 are sometimes referred to collectively as the challenged statutes.)4

Heirs "sought to retain the legal services of CZR to represent [them] in the medical malpractice action against [healthcare defendants]." However, CZR contends it is not economically feasible for it to represent heirs on a contingency basis given the limitations on recovery for noneconomic losses under Civil Code section 3333.2 and the limitations on contingency fee arrangements under Business and Professions Code section 6146. "CZR is ready, willing, and able to represent [heirs] if it is permitted to charge the contingency fee it ordinarily charges in personal injury matters and if the $250,000 cap on noneconomic damages is lifted."

Heirs desire to retain CZR but "cannot waive the statutory fee restrictions set forth above and CZR would be subject to discipline by the State Bar" if it accepted the engagement in violation of Business and Professions Code section 6146. The complaint alleges "the limitation on noneconomic damages ... has deprived [heirs] of the ability to obtain legal redress for the medical negligence suffered to fully prosecute their action."

Plaintiffs allege Civil Code section 3333.2 's cap on noneconomic damages was "enacted in 1975 and has not been adjusted—for inflation or otherwise—in the intervening nearly 45 years." Plaintiffs allege "CZR will spend at least $200,000 in costs to prosecute" heirs' claims against healthcare defendants; and because "the limit on contingent fees applies to [a] client's net recovery," CZR would only recover "a mere $20,000 in fees" on a maximum award of $250,000 for noneconomic damages.

Heirs "are currently paying their counsel an hourly rate to prosecute the underlying medical malpractice action." However, heirs "are of limited means and cannot afford to fully prosecute the action by paying their counsel on an hourly basis." Heirs "can only afford to be represented on a contingency fee basis."

Plaintiffs allege that whereas "medical malpractice plaintiffs ... have caps imposed on their litigation expenditures," medical malpractice defendants (for various reasons) are incentivized to "incur costs approaching or even exceeding the $250,000 maximum judgment knowing that the plaintiffs will be forced to spend more than the plaintiffs can legally recover and will therefore be forced to abandon an otherwise meritorious action." Plaintiffs allege that medical malpractice plaintiffs "necessarily need to match the defendants' experts at least one-for-one at trial" and that "[b]y requiring the plaintiffs and [the] defendant to be on different financial footing, the [challenged statutes] require the plaintiff[s], at least in terms of expert witnesses, to only be able to bring a knife to the defendant's gunfight."

Plaintiffs further allege the concerns that led to passage of the challenged statutes (i.e., increasing insurance rates and fewer insurance companies willing to write medical malpractice insurance) are no longer of sufficient concern to justify the continued application of the statutes. They allege, among other things, that with the passage of Proposition 103 in 1988 insurance companies can "earn a reasonable return"; "premium increases have been moderate"; insurers "have been highly profitable"; there is a competitive medical malpractice insurance market; and "a large portion of payments made by insurance companies ... are to insurance company defense attorneys and ... defense costs." Plaintiffs allege "radically rising medical malpractice insurance rates ... is not reasonably foreseeable."

In their complaint, plaintiffs assert various claims of unconstitutionality with regard to the challenged statutes. We discuss those claims in more detail in a subsequent part of this opinion.

Relevant Procedural Background Following the Filing of the Complaint

On August 25, 2020, the Attorney General demurred to plaintiffs' complaint and each cause of action therein on the grounds that plaintiffs "do not have standing to assert" any of the alleged causes of action, and each cause of action "fails to state facts sufficient to constitute a cause of action." On August 26, 2020, the Chairman joined in the Attorney General's notice of demurrer and demurrer.

On September 9, 2020, plaintiffs opposed the Attorney General's demurrer.

On September 14, 2020, plaintiffs filed a request that the complaint be dismissed with prejudice as to hospital only. The clerk of the court entered the dismissal as requested.

On September 15, 2020, the Attorney General filed his reply in support of his demurrer to plaintiffs' complaint.

On September 16, 2020, the Attorney General filed a notice of four related cases. According to the notice, CZR was handling three of the related cases and was making "identical arguments challenging the constitutionality of the [challenged statutes]."5 The fourth related case, among other things, purportedly "[arose] from the same or substantially identical transactions, incidents, or events requiring the determination of the same or substantially identical questions of law ...."6

Also on September 16, 2020, plaintiffs filed a request that the complaint be dismissed without prejudice as to Dr. Park only. The clerk of the court entered the dismissal as requested.

On September 22, 2020, the demurrer came on regularly for hearing. All parties appeared through counsel. A tentative ruling was announced, the parties argued the matter, and the matter was deemed submitted.

On September 29, 2020, the trial court issued its ruling on the demurrer. It accepted the Chairman's joinder and sustained the demurrer, without leave to amend, finding that plaintiffs "are without standing to pursue the claims alleged and have failed to adequately allege[ ] facts to support the claims they purport to allege." The court indicated the complaint "does not state nor can it state a justiciable controversy as to [the] demurring Defendants." In its ruling, the trial court explained:

"As to standing, none of the Plaintiffs alleges any injury conveying an ability to pursue their claims. This is apparent on the face of the Complaint and Plaintiffs concede in their opposition that the
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