One-year MICRA Statute of Limitations Applies to Claim Against Ambulance Driver Who Read-Ended Another Motorist (Gutierrez v. Tostado)

 

The one-year Statute of Limitations in California's MICRA regime bars untimely claim against driver of ambulance who rear-ended third-party motorist while transporting another patient

Plaintiff Gutierrez was driving on the I-280 when he was rear-ended by an ambulance driven by defendant Tostado.  The driver and ambulance operator brought a motion for summary judgment based on the statute of limitations found in California's Medical Injury Compensation Reform Act (MICRA).  This statute was passed by the voters in 1975 and limits the amounts recoverable due to alleged negligence in providing medical services.  

The Hon. Christopher J. Rudy of the Santa Clara County Superior Court granted the motion.  On appeal, the Sixth Appellate District upheld the grant of summary judgment over the dissent of one Justice. (Gutierrez v. Tostado (December 1, 2023) H049983.)

Upon appeal, the issue was whether the one-year MICRA statute of limitations found in Code of Civil Procedure section 340.5, as opposed to the general two-year statute of limitations for tort actions, applied.  In other words, did MICRA's provisions apply where the negligence of medical providers was directed at a non-patient such as fellow motorist Gutierrez, who just happened to be driving in front of defendants' ambulance?

 

Justice Greenwood, joined by Justice Grover, wrote for the majority and found that because Tostado was driving the ambulance he was providing "professional [medical] services" at the time of the accident.  Therefore, the time limitations found in MICRA applied.  This is important because under case law such as Flores v. Presbyterian Intercommunity Hospital (2016) 63 Cal. 4th 75, at 88, only actions “alleging injury suffered as a result of . . . the provision of medical care to patients” are subject to MICRA. (Gutierrez, p. 3; italics added.)

The majority answered this question affirmatively and cited to Canister v. Emergency Ambulance Service, Inc. (2008) 160 Cal. App. 4th 388, at 407, where the MICRA one-year limit applied to injury to someone injured while riding in an ambulance who was not a patient.  As Gutierrez explained at pages five to six, the MICRA time limit applied to someone not receiving medical service but who was nonetheless still injured as a result of negligence in providing such services:

 

In Canister, a police officer accompanying an arrestee in the back of an ambulance was injured when the ambulance hit a curb. At the time of the accident, the ambulance was being driven by one EMT while another attended to the arrestee in the rear of the ambulance. The officer sued for negligence. (Canister, supra, 160 Cal.App.4th at p. 392.) After finding that an EMT was a health care provider and that transporting a patient constituted professional services within the meaning of MICRA, the Canister court held that MICRA extends to “ ‘any foreseeable injured party, including patients, business invitees, staff members or visitors, provided the injuries alleged arose out of professional negligence.’ [Citation.]” (Id. at pp. 407-408.) The court concluded that it was foreseeable as a matter of law that a police officer accompanying an arrestee in an ambulance might be injured in the operation of the ambulance. (Id. at p. 408.)

 

Justice Bromberg dissented and wrote that neither the plaintiff nor the defendants could have anticipated that MICRA would apply in this situation, i.e., "a run-of-the-mill traffic accident involving an ambulance that happened to be transporting a patient on a non-emergency matter, presumably with its siren off." (Gutierrez dissent, p. 2.)  The dissent also noted the plaintiff's lawyers were unlikely to know that MICRA applied to his claim because in 1982 the MICRA provisions specifically related to paramedics were removed. (Gutierrez dissent, p. 4.)  Moreover, at the time MICRA was enacted the general statute of limitations for tort claims was one-year, meaning MICRA was not intended to shorten the time to bring claims. Rather, its purpose was to reduce the amount of monetary awards for medical malpractice to prevent a reduction in affordable and available medical care to the public.

Further review of Gutierrez

This case may ultimately be headed to the California Supreme Court, given that the case law cited by the majority and dissent lacks harmony as to when MICRA does or does not apply.

It should also be noted that earlier this year MICRA was amended by the California legislature.  The original $250,000 "cap" on claims for professional medical negligence was increased.  Wrongful death claims from medical malpractice are now "capped" at $500,000 and this amount will increase by $50,000 each January until the maximum is $1,000,000.  For other claims, the "cap" is $350,000, with yearly increases of $40,000 until the new limit reaches $750,000.

Scroll down below to send us a question or a comment.

Follow me on LinkedIn

Claim of Malpractice by Partnership Does Not "Relate-Back" to the Filing of Partner's Malpractice Claim (Engel v. Pech)

 

For purposes of the statute of limitations, a claim of attorney malpractice by a partnership is independent of a partner's prior malpractice claim 

The Second District has upheld a demurrer to an entire complaint on the grounds that such is barred by the statute of limitations because the partnership's claim against their former counsel did not "relate back" to the prior date an individual partner filed his own malpractice claim. (Engel v. Pech (September 28, 2023) B324560.)  The court further held that, although timely, the individual partner's claim was not viable since any actual damages were suffered by the partnership itself.  The Hon. Maureen Duffy-Lewis, Judge Presiding, of the Los Angeles County Superior Court sustained the defendant attorney's demurer to the entire complaint, and the individual and partnership both appealed. 

Key to this ruling was the fact the prior malpractice claim of the partner was, by way of amendment to the complaint, later expanded to include that of the partnership; as the appellate court explained:

A limited liability partnership and one of its partners retained a lawyer but limited the scope of representation to having the lawyer represent the partnership in a specific, ongoing case. After the partnership lost the case, the partner sued the lawyer for malpractice. In an amended complaint, the partnership was added as a plaintiff. The partner’s complaint was filed before the statute of limitations ran; the amendment was filed after. (Id., p. 2; original emphasis.)

It should be noted that the alleged malpractice by Pech related to his work representing an accounting partnership, Engel & Engel, LLP (referred to by the court as "the LLP") in an action against Wells Fargo.  However, individual plaintiff and partner in the LLP, Jason Engel, was not named as an individual party to the suit against the bank.

In amending the partner's claim against Pech to also include the LLP, plaintiffs claimed the amendment "related back" to the date of filing the prior malpractice claim and therefore was proper even though it was beyond the one-year time-limit.  The Second District disagreed, characterizing the LLP's claim as "independent" and noting this was not analogous to other instances where a complaint "related back" because a newly-added plaintiff was enforcing the same right as the original plaintiff:

An amendment adding a new plaintiff will not relate back to a prior complaint if the new plaintiff is “enforc[ing] an independent right” that imposes a “‘wholly distinct and different legal obligation against the defendant’” (Bartalo v. Superior Court (1975) 51 Cal.App.3d 526, 533, italics omitted (Bartalo); Branick v. Downey Savings & Loan Assn. (2006) 39 Cal.4th 235, 243 (Branick)). Because the partnership’s malpractice claims against the lawyer are distinct from—and in addition to—the partner’s malpractice claim, the partnership’s claims do not relate back and are untimely. (Id., p. 2; citation omitted.)

The Second District further noted the original complaint by the partner "misleadingly alleges that Engel himself. . . was. . . the party who prosecuted the Wells Fargo litigation" even though he was not. (Id., p. 5.)

As to the claim of Engel as an individual, the Second District found that even though both Engel and the LLP itself signed the retainer agreement with Pech, only the latter suffered damages. Writing for the majority, Justice Hoffstadt found this indicated only the LLP could bring a claim against Pech, given that the malpractice involved the Wells Fargo suit:

[T]he operative complaint is. . . explicitly limited to deficiencies in Pech’s representation during the Wells Fargo litigation, [meaning] the only entity that could have suffered damages as a result of that malpractice was the LLP, not Engel. (Id., p. 17.)

Tips for practitioners

Plaintiffs and their counsel should decide at the outset whom to include in the complaint and who has what particular claim.  Counsel should be especially careful in this regard where the subject of the lawsuit is prior business dealings that are well-documented.  Where there is such a trial of documents it is difficult to argue the plaintiff missed the statutory deadline to file because they were either 1) "ignorant" of the identity of a defendant, and/or 2) not aware of their specific role in the dealings between the parties.

Nonetheless, experience teaches that some counsel appear to rely far too heavily upon the general rule of "liberality" in amending pleadings and/or the "relation back" doctrine.  These counsel wrongly assume they may add parties who have different roles in the subject transactions and, therefore lesser or greater damages, at any stage in the proceedings by simply filing an amended complaint.

Scroll down below to send us a question or a comment.

Follow me on LinkedIn

Equitable tolling may apply due to prior foreign actions (Metabyte v Technicolor)

“Equitable tolling” applies broadly so that prior civil and criminal complaints in France alleging similar harm may save a California suit filed beyond the statute of limitations

Justice Stratton, Presiding Justice of the Second Appellate District, Division Eight, explained that the legal saga in Metabyte v. Technicolor (August 9, 2023) B319338, had involved no less than four separate actions, two in the United States and two in France:

In a case which seems destined for the pages of a civil procedure casebook, Metabyte, Inc., appeals from the trial court's judgment of dismissal and order sustaining Technicolor's demurrer without leave to amend. This 2021 action represents Metabyte's fourth attempt to hold Technicolor liable for Technicolor's allegedly improper auction of a patent portfolio in 2009. The first two actions were brought in France, where Technicolor is headquartered. Metabyte brought a proceeding under Article 145 of the French Code of Civil Procedure (Article 145 proceeding), and then filed a criminal “plainte” against Technicolor. After the French courts ruled they lacked jurisdiction in the criminal action, Metabyte brought an action in United States District Court in California alleging a federal RICO claim and several state law causes of action. After the district court ruled that equitable tolling did not apply to its RICO claim as a matter of federal law, Metabyte dismissed the federal action and brought its state law claims in Los Angeles County Superior Court. (Id., p. 2; footnote omitted.)

These claims, of course, included fraud and related torts.  The Hon. Daniel S. Murphy of the Los Angeles County Superior Court granted Technicolor's demurrer without leave to amend, finding the Article 145 proceeding was dissimilar in the relief it sought and therefore equitably tolling did not apply.  The California action was therefore barred by the Statute of Limitations.

The genesis of Metabyte’s claims was that after obtaining a majority interest in a portfolio of patents owned by its subsidiary MNI, Technicolor then auctioned them off in a process that resulted in payment being made to preferred shares only and thus nothing to common shareholders such as Metabyte.

Metabyte is a California corporation. Metabyte's subsidiary Metabyte Networks, Inc (MNI) owned patents on digital video recording (DVR) technology used by cable television companies in set top boxes. Metabyte and its CEO and principal shareholder Manu Mehta owned the stock of MNI. At some point, Metabyte sold shares in MNI to an entity eventually known as Technicolor USA, but it retained majority ownership of MNI's stock. When MNI needed additional financing, it sold shares to Canal+ Technologies, a corporation in which Technicolor S.A. was a minority shareholder. An entity which became Technicolor International then purchased a controlling interest in Canal+ Technologies, giving Technicolor majority ownership of MNI stock.

At some point, Technicolor decided to liquidate MNI. In July 2001, liquidation preferences were set. Common shareholders such as Metabyte could not receive any money from the liquidation of assets until the preferred shareholders received over $16.4 million. In December 2009, Technicolor forced an auction of MNI's patent portfolio. A Technicolor subsidiary bought the patents for $1 million. In October 2010, Technicolor dissolved MNI. (Id., pp. 3-4.)

Metabyte later learned of allegations that Technicolor was being investigated in France for wrongfully acquiring assets of another company in which it invested, driving it into bankruptcy and then acquiring its assets for less than market value.  Metabyte alleged Technicolor committed similar fraud here in that it valued the patent portfolio originally owned by MNI for less than it was worth so that Metabyte received nothing. 

In 2010 Metabyte initiated an Article 145 proceeding in France, the result of which appears to have been mixed at best.  Metabyte obtained an order to have a bailiff appear unannounced at Technicolor to seize documents from Technicolor, but was then denied access to some of these documents.  While the Cour D’Appel and the Cour de Cassation (respectively, the Court of Appeal and Supreme Court) both ruled in favor of Metabyte, it appears Technicolor’s threats and an order it obtained from the Paris Bar discouraged the Bailiff in the section 145 proceeding from releasing documents to Metabyte.

Metabyte also initiated a criminal complaint in France.  However, the Prosecuting Magistrate found France lacked jurisdiction to prosecute French entity Technicolor on behalf of the American entity Metabyte.

Metabyte then filed a RICO complaint in the United States District Court for the Northern District of California.  The District Court granted Technicolor’s Rule 12(b) motion to dismiss, noting equitable tolling did not apply because the Article 145 proceeding did not seek the same relief and the statute of limitations barred the action.  Metabyte then voluntarily dismissed the District Court action but without prejudice.

When Metabyte filed the present suit in the Superior Court of Los Angeles County, Technicolor adopted the District Court’s reasoning as its chief defense argument.  Technicolor filed a demurrer based, inter alia, upon the statute of limitations which, as noted, was sustained without leave to amend.

Metabyte should have been given the opportunity to state additional facts showing equitable tolling might apply

Technicolor not only argued that equitable tolling did not apply to save the last-filed California court action, but also that judicial estoppel applied to bar the new California complaint.  Specifically, Technicolor argued the dismissal of the RICO action barred any subsequent state law claims by Metabyte.  The Second District disagreed, noting that where a demurrer is sustained with leave to amend (and, of course, the Rule 12(b) motion was akin to a demurrer), any subsequent dismissal “without prejudice” is not dispositive, and thus not res judicata on the claims dismissed so as to preclude these claims.  In a footnote, the appellate  court explained that even where a complaint is dismissed “with prejudice,” the res judicata effect is limited and a subsequent claim is not barred if “new or additional facts are alleged that cure the effects in the original pleading. . . .” (Metabyte, p. 12, citing to Wells v. Marina City Properties (1981) 29 Cal. 3d. 781, at 789.)

        

Having disposed of Technicolor’s argument that claim preclusion did not apply to bar the action, it turned to Metabyte’s argument that equitable tolling applied save the otherwise timely claims for fraud dating from the 2009 patent auction.  Technicolor argued the dissimilarity in the prior French actions meant the doctrine did not apply.  However, the appellate court stressed this was not the proper test; rather, in order to extend the statute of limitations by way of “equitable tolling,” a court must conduct a three-part analysis:

To determine whether equitable tolling may extend a statute of limitations, courts must analyze whether a plaintiff has established the doctrine's three elements: timely notice to the defendant, lack of prejudice to the defendant, and reasonable and good faith conduct by the plaintiff. (Metabyte, p. 16, quoting from Saint Francis Memorial Hospital v. State Dept. of Public Health (2020) 9 Cal. 5th 710, pp. 725–726.)

Metabyte then discussed the nature of this three-part analysis, calling it “fact-intensive” and concluding such issues are more properly resolved by way of a motion for summary judgment. (Id., pp. 16-17.)  Towards this, the Second District rejected Technicolor’s argument that the Article 145 procedure was so dissimilar as to make it impossible for plaintiff Metabyte to show a lack of prejudice to Technicolor, noting that the original French civil proceeding gave Technicolor sufficient notice to begin a defense to Metabyte’s claims.

The appellate court therefore held the trial court had improperly failed to grant leave to amend, explaining Metabyte should be given an opportunity to plead further facts which indicate it is entitled to equitable tolling, such as that it acted reasonably and in good faith in bringing the French actions before the California suit.  The Second District found this “good faith” had not been sufficiently plead, but also held Metabyte should be permitted to plead such facts.  In summary, the Metabyte court found that equitable tolling could, at least in theory, be based upon the section 145 proceeding:

We reverse the order insofar as it requires a legal remedy which seeks to lessen damages and which holds that Article 145 proceedings can never satisfy the requirements for equitable proceedings. (Id., p. 20.)

Lessons for practitioners

Perhaps an overly-simplistic way in which to view this foregoing is to note the “home court” advantage which Technicolor obtained in France, where the Bailiff would not turn over documents despite multiple orders to do so, and, at the same time, the advantage Metabyte obtained in California, where the appellate court revived claims of fraud based on a 2009 patent sale.  

Whether one agrees with this somewhat cynical view, the opinion offers other lessons for practitioners.  The Second District appears to have taken a broad view of when leave to amend should be granted, giving the plaintiff the benefit of the doubt as to facts which one could plead on the issue of equitable tolling so that the suit might survive claims it was untimely.  On this point one may speculate the actions of Technicolor in effectively blocking the Article 145 action and preventing the Bailiff from providing documents to Metabyte may have had some bearing on the issue of whether equitable tolling — with an emphasis on the word “equitable’ — applied in the California action

A more jaundiced view might be that a party who has plead a claim since 2009 on two continents has already been given sufficient opportunity to plead whatever it might plead.  Nonetheless, Metabyte was given leave at this late date to state additional facts to meet the test for the application of equitable tolling.  

Also relevant is the appellate court’s discussion of res judicata, giving a nuanced approach as to when the doctrine applies. Therefore, those who encounter an argument that dismissal with prejudice bars all future claims might want to cite Metabyte in support of their counter-argument that newly-discovered facts may in fact be an exception.