MARY KAY RADAVICH ET AL VS HRAYR K SHAHINIAN ET AL

Tentative Rulings

Case Number: BC657669    Hearing Date: August 21, 2020    Dept: U

PLEASE POST THIS FOR BOTH CASES:

Tentative ruling on the motions to stay filed by Defendant Hrayr Shahinian, M.D. in two related cases, STEPHANIE BROWN JACOBSON SPIES, et al. v. HRAYR SHAHINIAN MD, et al., Case No. BC684807, and MARY KAY RADAVICH, et al., v. HRAYR K. SHAHINIAN, Case No. BC657669.

BACKGROUND

In these related actions for medical malpractice, multiple plaintiffs allege that Defendant Hrayr Shahinian MD misrepresented that he was qualified to perform brain surgery. Plaintiffs allege Defendants Deanco Healthcare, LLC dba Mission Community Hospital knew Shahinian was negligent in his performance of brain surgery in at least four hospitals but nevertheless allowed Shahinian to perform perhaps hundreds of brain surgeries at Mission Community Hospital.

On or about October 28, 2019, Defendant Shahinian filed motions in both actions to stay all proceedings against him pending the completion of his declaratory relief action against his malpractice insurer, his writ proceedings challenging an administrative decision revoking his medical license, and the coordination of the various related cases that have been brought against him in Los Angeles Superior Court.  In his supplemental briefing, Defendant Shahinian adds that the stay should extend to allow him to secure a ruling on his recent efforts to reinstate his physician’s and surgeon’s licenses. 

In the oppositions filed by plaintiffs in both cases, they argue that the stay motions are Defendant Shahinian’s latest attempt to needlessly delay these action and is based on several flawed contentions: (1) that Shahinian’s coverage dispute with his carrier is directly related to the claims in this case; (2) that Shahinian has a pending appeal which impacts this case; (3) that the results of Shahinian’s application for reinstatement of his license will have any impact on the insurance coverage case or the underlying negligence actions; and (4) that Shahinian can secure prompt relief in his coverage action.  Plaintiffs ask this Court to deny Shahinian’s Motion arguing that neither Shahinian’s coverage dispute nor his reinstatement application has anything to do with whether Shahinian acted negligently or intentionally to injure plaintiffs, and that any further delays are unjustified and will unduly prejudice plaintiffs. 

TENTATIVE RULING

Defendant Hrayr Shahinian MD’s motions to stay are DENIED.

DISCUSSION

Defendant Hrayr Shahinian MD (“Defendant”) moves to stay both proceedings based on four sets of cases that Defendant contends are pending and present the risk of inconsistent rulings on common questions of fact.  Defendant also argues that he will be severely prejudiced if he is forced to mount a defense to Plaintiff’s actions without an attorney provided by his insurance carrier because he lacks funds to hire a private attorney and the legal training necessary to represent himself. 

Based on the Court’s analysis, the Court determines the reasons offered by Defendant are insufficient to justify the requested order.

A. Defendant’s Action against His Insurer, Physicians’ Casualty Risk Retention Group

Defendant contends that the Court should stay the action because Defendant’s action against his malpractice insurer (“Insurer Action”) is pending and he may obtain a legal defense in this action if he is successful in that action.  On May 30, 2018, Defendant commenced the Insurer Action against his malpractice insurer, Physicians’ Casualty Risk Retention Group, for breach of insurance contract and declaratory relief on the duty to defend. (See Case No. BC708094.)  Defendant urges the Court to set a schedule for the filing and consideration of cross-motions for summary adjudication to reach a prompt resolution of this action with the potential that he will be afforded a defense by his insurer in these malpractice actions.

The Court finds this argument to be unpersuasive for two reasons.  First, resolution of the coverage issues in the Insurer Action will have no impact on these malpractice actions as they are wholly unrelated to the negligence and other claims raised by Plaintiffs in their actions.  Second, in light of the mandatory stay issued in the Insurer Action, this Court lacks the authority to schedule cross-motions for summary adjudication on coverage issues.  Third, given the current posture of the Insurer Action, the Court concludes that Defendant’s successful resolution of those coverage issues in the proper forum in Alabama seems unlikely to occur any time soon. 

Turning to the first issue, the Court disagrees with Defendant that there is a factual or legal basis for staying the malpractice actions while the coverage issues are resolved.  The authority relied upon by the Defendant for a stay is Haskel, Inc. v. Superior Court (1995) 33 Cal.App.4th 963, 979.  Haskel rested on general principles from Montrose Chemical Corp. v. Superior Court (1993) 6 Cal.4th 287, 301-302, stating: “when the third party seeks damages on account of the insured's negligence, and the insurer seeks to avoid providing a defense by arguing that its insured harmed the third party by intentional conduct, the potential that the insurer's proof will prejudice its insured in the underlying litigation is obvious. This is the classic situation in which the declaratory relief action should be stayed.  By contrast, when the coverage question is logically unrelated to the issues of consequence in the underlying case, the declaratory relief action may properly proceed to judgment.” (Haskel, Inc. v. Superior Court, supra, 33 Cal.App.4th at 979.)

Here, the Insurer Action, which is a declaratory relief action to determine Defendant’s insurer’s duty to defend, is not logically related to issues of consequence in the underlying malpractice actions. The Insurer Action concerns whether Defendant’s insurer breached the insurance contract with Defendant based on the insurer’s allegedly incorrect assertion that Defendant failed to disclose a complaint by a patient to the insurer. (Complaint in Case No. BC708094, ¶ 26.)  By contrast, the underlying actions concern whether Defendant committed medical negligence by performing brain surgeries. (E.g., Jacobson Spies Second Amended Complaint, ¶ 1.) Defendant’s alleged failure to disclose a patient complaint to the insurer and Defendant’s performance of brain surgeries on patients are not logically related and do not require the same factual findings to determine liability.  Defendant has not made a sufficient showing that the actions are logically related or that they will involve overlapping factual findings.  Even if Defendant had shown the issues of consequence in the actions to be logically related, Haskel and Montrose authorized staying the declaratory relief action, not the underlying action, as requested here.  So, Defendant’s authority must also be distinguished on this basis.

Second, the Court lacks authority to schedule dispositive motions in the Insurer Action, which must be pursued in the insurance liquidation proceeding in Alabama.  On April 23, 2020, this Court issued an order staying all proceedings in the Insurer Action consistent with the August 16, 2019 order from the Circuit Court for Montgomery County, State of Alabama, in case no. 03-CV-2019-900803, Jim L. Ridling as Commissioner of Insurance v. Physicians Casualty Risk Retention Group, Inc., until further order of this Court.  The stay was entered in deference to the Alabama court’s determinations in a delinquency proceeding against Physicians Casualty Risk Retention Group that the company is insolvent and that all claims against the delinquent company must be prosecuted before the Alabama court.  This Court found that such a result was mandated by California Insurance Code section 1064.5.  Recently, on August 10, 2020, the Alabama court issued a further order terminating the rehabilitation proceedings, ordering liquidation of Physicians, and reaffirming its exclusive jurisdiction over all claims and cases brought against Physicians.  These rulings bar any action by this Court to schedule or consider the resolution of the coverage issues in the Insurer Action.  Any motions brought to determine coverage issues must be filed with and ruled on by the Alabama court presiding over Physicians’ delinquency proceeding. 

Third, in light of the Alabama court’s recent order to liquidate Physicians and require that all claims against the company be litigated in Alabama, this Court has no control over the timing of the resolution of Defendant’s coverage claims.  These claims have been pending in this Court for more than two years, and there is no assurance that they will be promptly resolved in the Alabama action or that any determination in the context of that liquidation proceeding will result in Defendant’s ability to secure insurance counsel.  With no foreseeable end in sight for Defendant’s efforts to establish coverage, the Court concludes that the balance of equities tips sharply in favor of denying a stay to avoid any further delays in the prosecution of Plaintiffs’ malpractice claims against Defendant. 

Based on the foregoing, the Court is not persuaded that a stay should be entered because of the pendency of the Insurer Action or Defendant’s underlying coverage arguments.

B. Writ after Defendant’s License was Revoked

Next, Defendant contends a petition for writ of mandate he filed in Sacramento County in response to the administrative decision revoking his medical license (the “Writ Action”) may be dispositive of claims in this case, and thus, the Court should stay this action pending the result of the Writ Action.

Defendant contends the Writ Action may be dispositive of this lawsuit because the underlying administrative decision challenged in the Writ Action and this action address similar “issues” arising from the Ralli case (Case No. BC362005), which was an action brought by a patient who is unrelated to the plaintiffs here, charging Defendant with medical malpractice and fraud. Defendant argues that a decision on the Writ Petition that is favorable to him would discredit the Ralli case and therefore the issues from Ralli raised in this case would also be decided in Defendant’s favor.

To the extent Defendant is suggesting that issue preclusion applies, Defendant has failed to demonstrate that any ruling on the Writ Action regarding his medical license would have any impact on the Court’s analysis of the argument that there were issues resolved in Ralli that bar relitigation in this case.  If faced with an issue preclusion argument, this Court would have to examine Ralli to determine if any issue resolved in that case is barred from being relitigated in this case.  Any conclusions reached in the Writ Action would be totally immaterial to this inquiry.  This is true whether the court in the Writ Action decided to rely on factual findings in Ralli or concluded that they were invalid or irrelevant.  The Court concludes that any reliance of the court in the Writ Action on factual findings made in the Ralli case would have no effect on this Court’s potential resolution of issue preclusion arguments that might be raised by the parties here.  Thus, regardless of its procedural status, the Writ Action does not provide any justification for staying this action. 

What is more, according to the website for the Court of Appeal for the Third Appellate District, the appellate court has already rejected Defendant’s petition for writ of mandate.  The only matter that remained to be resolved on Defendant’s challenge to his license revocation when when the Court first addressed Defendant’s motion to stay was his petition for review by the California Supreme Court which was received by the Court of Appeal on February 4, 2020.  That petition was denied by the Supreme Court on April 15, 2020. 

C. Resolution of Defendant’s Application to Reinstate His Medical Licenses

In his supplemental papers, Defendant asserts that the Court should stay the malpractice cases to allow him to pursue his application to reinstate his medical licenses.  Defendant fails to explain how this proceeding could have any impact on the negligence issues raised in the malpractice actions or on the coverage issues in the Insurer Action.  Any prospective relief Defendant might obtain can have no relevance whatsoever to these pending actions.  Nor is there any basis for concluding that any administrative findings in those cases would be of any significance in the malpractice actions, much less of such great import that the Court should arrest their progress to wait for such findings.

D. Resolution of Related Actions

Defendant contended in this moving papers that, although some Superior Court cases have been deemed related since September 20, 2018, “there has been no clarification or order as to how the related cases are to be handled or which of the several judges before whom this action and the two sister actions (the Radavich and Singh matters) are currently pending will ultimately preside over discovery, dispositive motions, or trial and pre- and post-trial related matters.” (Shahinian Decl. ¶ 13.) Thus, Defendant requests the Court stay the action until these issues are resolved.

Since Defendant’s motion to stay was initially heard in the Jacobson Spies case, all coordination issues have been resolved by the Superior Court.  On April 24, 2020, this Court ruled that the Jacobson Spies case (BC684807) and the Radavich action (BC657669) are related within the meaning of CRC 3.300(a), because both of them assert similar medical malpractice and other associated claims against Hrayr K. Shahinian, M.D., in connection with the medical treatment he provided the plaintiffs in both cases at Mission Community Hospital.  Accordingly, the Court ordered the Radavich action transferred to this judicial officer in Department U of the Van Nuys Courthouse East. 

A third case, PARMINDER SINGH, et al., v. HRAYR SHAHINIAN MD (Case No. BC694194), remains pending before Judge Lia Martin in Department 16 of the Stanley Mosk Courthouse.  Defendant Shahinian’s suggestion that the Court find it to be related to the Insurer Action and various actions brought against him was denied on November 4, 2019. 

Even if there are additional cases that raise similar claims or issues, Defendant has not shown that there are any matters raised by these cases that must be coordinated with the litigation of the two malpractice cases pending in Department U, nor any reason to stay this case to assess a purported need for such coordination.  If Defendant suggests to the Court that there are other cases that should be found to be related to this action, any issues of concern to him may be resolved.  The Court is not inclined to enter a stay of this action based on a theoretical coordination problem that may be resolved by the simple process of filing of notices of related cases. 

Defendant also cites authority for the Court to stay these malpractice action as a means of preventing inconsistent verdicts and findings of common factual issues. (Mot. 8:16-22.)  But Defendant has failed to show that either the Insurer Action, the Writ Action or any other actions pose such a problem.  The Court finds there is no showing of a danger of inconsistent rulings in permitting the continued litigation of these malpractice cases. 

Accordingly, the motion to stay is DENIED.

Plaintiffs’ counsel in each case is ordered to give notice of the Court’s ruling to the parties in that action.