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California: Litigation Tool Box: How to Avoid the “Gotchas”

January 16, 2024 (13 min read)

By Hon. Colleen Casey, Former Commissioner, California Workers’ Compensation Appeals Board

No wonder it’s a jungle out there. No one is following the rules. Do the Labor Code rules still exist? We were all distracted by COVID. Were changes made while we weren’t looking? Did a mind sweep function somehow delete our collective memory? Inquiring minds want to know. Recent WCAB decisions provide some curious answers.

For instance, take a look at the recent Noteworthy Panel Decision (NPD) of Pena v. Sutter Mem. Hosp., 2022 Cal. Wrk. Comp. P.D. LEXIS 164. The majority WCAB opinion affirmed the WCJ’s decision to admit medical records into evidence, even though applicant acknowledged her failure to list those documents on the MSC statement.

The WCAB explained, “To be clear, none of the above excuses applicant's attorney's failure to timely list and serve the records in question. But by the same token, that failure does not absolve the WCJ of the responsibility to issue a decision based upon substantial  medical evidence when confronted with an applicant providing credible testimony of  further injury. Here, the WCJ's decision to order development of the record was compelled by that testimony.”

But wait! Didn't the 5th DCA tell us in the case of Telles Transport v. WCAB (2001) 92 Cal. App. 4th 1159, 66 Cal. Comp. Cases 1290, that discovery closed at the Mandatory Settlement Conference (MSC) in order to "eliminate the element of surprise in workers' compensation proceedings?" Isn't that why the 5th DCA held that the "WCAB abused its discetion and exceeded its powers" when it relied on Labor Code §§ 5702 and 5906 to order the WCJ to admit the records into evidence that had not been listed at the MSC? To bolster its decision, the 5th DCA pulled a quote from a similar fact pattern in the 4th DCA's decision of San Bernardino Cmty. Hosp. v. WCAB (1999) 74 Cal. App. 4th 928, 64 Cal. Comp Cases 986.

“In this case, the Board's use of its undoubted powers under sections 5701 and 5906 improperly undercut the clear intent of section 5502(d)(3). By using the former two statutes to afford relief from the disclosure requirements, the Board effectively pulled the teeth from the latter section.”

Aren’t DCA holdings valid precedent? The holding would be compliant if the facts in Pena were clearly distinguished from the facts in Telles Transport, but it doesn’t look like they were.

In order to win cases and influence people, knowing how to use the “rules” is more important than ever during these post-COVID days. Although some formats for trials have changed, the core of our interpretive legal system has stayed the same.

It starts with the pre-trial prep.

1. Filing the DOR 

a. If the issue = employment = Request a Priority Conference, NOT an MSC

In the case of Green v Golden Drop, 2023 Cal. Wrk. Comp. P.D. LEXIS 290, applicant filed a Declaration of Readiness (DOR) on 10/9/2019 for an MSC on the issue of employment and discovery. The mandatory settlement conference (MSC) Judge refused applicant’s request to set the issue of employment for trial, leaving only the issue requested by defendant, i.e., Statute of Limitations. The defendant prevailed at trial, and applicant’s claim was dismissed.

Not surprisingly, at Recon, on 10/9/2023, the WCAB vacated the WCJ’s Order of Dismissal and remanded the case to the trial level to adjudicate the issue of employment.

It took applicant exactly four years from the time he filed the DOR to have the issue of employment set for trial. This is not unusual, but more common is the situation where parties are frustrated when a WCJ refuses to bifurcate the employment issue at trial and insists on trying everything all at one time in the name of “judicial economy.” Pleas that it is more expedient to solely try the employment issue first go unheeded and the long drawn-out process of “full on” litigation takes its course.

HOWEVER, there is a rule which could have considerably shortened this four-year delay since it would have required the sole issue of employment to be tried first. It is called Labor Code § 5502(c) and allows parties to file a DOR for a “priority conference” as follows:

“The AD shall establish a priority conference calendar [wherein] the issues in dispute are employment or AOE/COE. The conference shall be conducted by a WCJ within 30 days after the DOR. If the dispute cannot be resolved at the conference, a trial shall be set as expeditiously as possible, unless good cause is shown why discovery is not complete, in which case status conferences shall be held at regular intervals…A determination as to the rights of the parties shall be made and filed within 30 days after the trial.”

If the applicant in the Green case had filed a DOR for a “Priority Conference,” instead of an MSC, it’s likely the four-year delay would have been considerably truncated.

b. DOR gotcha - “Meet & Confer”

WCAB Rule 10742(c) requires two specific actions by the filing party of a DOR:

(1) A “meet & confer” declaration under penalty of perjury specifically stating what efforts were undertaken to resolve the dispute.

(2) A “discovery is complete” declaration under penalty of perjury.

Further, WCAB Rule 10742(e) warns that failure to comply with the above requirements may result in sanctions and costs as well as having the matter be taken off calendar.

WCAB proceedings err on the side of forgiving “informality.” However, even though it has become a habit not to strictly enforce the above WCAB Rule 10742, it can have serious adverse consequences for parties when a WCJ decides to enforce the rule unexpectedly. An argument that few (if any) litigators comply with this rule will not be persuasive. Enforcement of the rule often occurs when the moving party wishes to conduct additional discovery at the MSC. This request is usually denied by the WCJ on the basis that the moving party stated under penalty of perjury on their DOR that discovery is complete. If discovery was ongoing, the party should not have sworn under penalty of perjury that it was complete. That’s a HUGE Whoops! (For an example of what happens when this occurs, see the NPD of Cervantes v. Walmart, 2022 Cal. Wrk. Comp. P.D. LEXIS 293.)

The rationale for the “meet and confer” requirement was discussed in depth in the NPD of Jones (Robert) v. Russo Brothers Transportation, 2022 Cal. Wrk. Comp. P.D. LEXIS 278. The WCAB noted in the 2nd footnote why parties must attempt resolution of issues independently, prior to seeking assistance of the WCAB. The issue in this case dealt with strict compliance of the “meet and confer” mandate set forth in the Cal. Code of Civil Procedure dealing with all motions to stay proceedings. Although the pre-trial procedures set forth in the WCAB rules have “analogues in the Code of Civil Procedure (CCP),” the purpose for the “meet and confer” CCP mandate is the same, as follows:

“We acknowledge that the purpose of the meet and confer requirement is ‘to encourage the parties to work out their differences informally so as to avoid the necessity for a  formal order. [Citations.] This, in turn, will lessen the burden on the court and reduce the  unnecessary expenditure of resources by litigants through promotion of informal, extrajudicial resolution of discovery disputes.’ (Clement v. Alegre (2009) 177 Cal. App. 4th 1277, 1292 [99 Cal. Rptr. 3d 791, 2009 Cal. App. LEXIS 1568].)”

PRACTICE TIP: When a moving party details their attempts to resolve a disputed issue with opposing counsel prior to filing the DOR, it is not only an attempt to “follow the rules,” but is also clear evidence of that party’s intent to be considerate of the limited resources of the judicial system

2. The Mandatory Settlement Conference (MSC) Statement

a. MSC gotcha - “Meet & Confer”

Once the DOR has been filed, and the conference date is set, what is the next step? It’s that perennial “meet and confer” mandate popping up once again. Are you starting to see a pattern? At the very least, it is a gentle reminder by the WCAB that parties shall talk among themselves before seeking help from the Board.

8 CCR § 10759(b) provides:

“(b) The parties shall meet and confer prior to the mandatory settlement conference and, absent resolution of the dispute(s), the parties shall complete a joint Pre-Trial Conference Statement setting forth the issues and stipulations for trial, witnesses, and a list of exhibits by the close of the mandatory settlement conference.” (Emphasis added.)

This section of the regulation is relatively new, but the Labor Code § 5502 governing how MSCs should be conducted has been around for decades. Yet, parties still can’t seem to comply with all the requirements, even though it would definitely be in their best interest, as well as their client’s best interest to do so.

Labor Code § 5502(d)(3) provides:

“If the claim is not resolved at the mandatory settlement conference, the parties shall file a pretrial conference statement noting the specific issues in dispute, each party’s proposed permanent disability rating, and listing the exhibits, and disclosing witnesses.” (Emphasis added.)

WCJs are interpreting the time period in which the MSC statement is required to be presented to the judge in a variety of ways. Most judges require the parties present the statement as soon as their case is called if they have not been able to settle the case. That way, judges will be able to assist with settlement if they are able to view the document for reference to the basic facts. With the document in front of them, the WCJ is in a better position to issue a ruling as to whether the parties are ready to proceed to trial. If a WCJ does not have a completed MSC statement in front of them prior to the end of the conference day, there are only two options: (1) the conference will either be continued; or (2) the conference will be Ordered Taken Off Calendar (OTOC’d.)

However, if one party has complied with Labor Code § 5502(d)(3) and opposing counsel has not, it is clearly within in the discretion of the Judge to review the “partially completed” MSC statement (PTCS) and impose sanctions on the party who failed to comply with the Labor Code § 5502(d)(3) mandate.

In the NPD of Castro v. Barrett Business Services, 2022 Cal. Wrk. Comp. P.D. LEXIS 313, the parties were unable to settle the case prior to the MSC and were attempting settlement at the close of the conference. In an attempt at accommodation, the WCJ issued Minutes of Hearing with an Order for the parties to file PTSC in 20 days from the date of the MSC on 5/3/2022.

Defense complied with the request and filed the PTCS, but applicant attorney refused to comply and did not enter any data or signatures on the statement.

At trial on 8/24/2022, applicant attorney again refused to complete the PTCS, and insisted that since he refused to sign, no stipulations existed, and therefore the trial could not go forward.

The WCJ explained that since the parties were at an impasse regarding settlement, pursuant to Labor Code § 5502(d)(3), they were required by law to submit a complete PTCS on the day of the MSC, 5/3/2022, or at the very least by 5/23/2022, when ordered to do so by the WCJ. The trial judge felt he had no choice but to issue a Notice of Intent (NIT) to impose costs and sanctions for applicant attorney’s failure to comply with the law and for deliberately obstructing justice.

The applicant attorney filed a Petition for Removal, arguing applicant’s “due process rights” were violated when the NIT was filed, since he shouldn’t be forced to proceed to trial before he was ready to do so. The WCAB denied the Petition and stated:

“All parties are expected to comply with orders by a WCJ and by the Appeals Board, and  if they are unable to comply, they must seek the appropriate relief. Parties are reminded that a willful failure to comply with an order could subject the offending party to sanctions. With respect to the notice of intention issued by the WCJ on August 30, 2022, the issue of sanctions may properly be heard at the time of trial in the case in chief, and a record can be created.”

“Due process” simply means that all parties must be provided “notice” and an “opportunity to be heard” on an issue before that issue is set for trial. In this case, applicant had plenty of notice and opportunities to be heard prior to the case being set for trial. So the argument that applicant’s “due process” rights were violated was specious at best.

b. Provide a Proposed Rating String

Labor Code § 5502(d)(3) provides:

“If the claim is not resolved at the mandatory settlement conference, the parties shall file a pretrial conference statement noting the specific issues in dispute, each party’s proposed permanent disability rating, and listing the exhibits, and disclosing witnesses.” (Emphasis added.)

The requirement that parties provide their proposed permanent disability rating string on the MSC statement has been included in Labor Code § 5502 since time immemorial. So why don’t the parties do this? It sure would have expedited a decision in the NPD of Thompson v County of Los Angeles, 2023 Cal. Wrk. Comp. P.D. LEXIS 217, if they had.

In the Thompson case, applicant’s injuries as a deputy sheriff had occurred prior to 1997. The parties agreed the 1997 Permanent Disability Rating Schedule (PDRS) was the appropriate one to use, rather than the more current 2005 PDRS. Applicant argued that the PDRS had been rebutted and that she is now 100% PTD. Defense disagreed. But there was a problem. No one bothered to alert the judge as to what each parties’ proposed strict rating string was as required by Labor Code § 5502(d)(3). Nevertheless, the WCJ went ahead and ruled in favor of applicant, that she had rebutted the strict rating of the PDRS and was currently 100% disabled.

Although scheduled PD ratings are eligible for rebuttal if valid, the rational for this method is premised on the concept that a strict rating must be determined first. Since proposed strict rating strings (and rebuttal if applicable) were not offered by the parties in this case, the judge skipped that step as well and held that the applicant was permanently and totally disabled. The WCAB vacated the finding, including the issue of level of PD. The case was returned to the trial level, with directions to develop the record consistent with the WCAB opinion.

As of this date, over 26 years after the date of injury, the applicant still does not have a final ruling as to her level of PD.


The Labor Code, the Regulations of the WCAB and the Administrative Director, along with the WCAB policy and procedure Manual, provide abundant guidance on how to successfully present your case to the Judge.

In addition, there are major cases in the last five years which also present helpful rules to follow, such as the recent WCAB en banc decision of Nunes v. State of California (2023) 88 Cal. Comp. Cases 741. It would behoove all attorneys to create and keep a running list of these cases, along with the primary rules contained therein, in their “Litigation Toolbox” for reference when preparing a case for trial. This will not only benefit the parties, but the expedient functioning of the litigation system as well.

Reminder: Board panel decisions are not binding precedent.

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