FRESNO, Calif. (Legal Newsline) - A law firm has no basis for suing to eliminate California’s cap on contingency fees and non-economic damages in malpractice lawsuits, an appeals court ruled, citing previous decisions by the state Supreme Court as well as the law firm’s speculative theories about how the caps deny plaintiffs the right to sue.
Carpenter, Zuckerman & Rowley represents Tracy Dominguez and Ruben Xavier DeLeon, who are suing Mercy Hospital of Bakersfield and two doctors over the deaths of their relatives. In 2020, CZR and the plaintiffs filed a complaint for declaratory judgment against California Attorney General Rob Bonta, claiming a $250,000 cap on pain and suffering awards in malpractice suits and limits on contingency fees makes it economically unfeasible to hire lawyers and expert witnesses.
The firm, which filed at least four similar cases, said the laws violate the First, Fifth and 14th amendments of the U.S. Constitution as well as similar clauses in the California Constitution.
“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,” the law firm said in a court filing. If the cap applies, the law firm said, it would only recover “a mere $20,000 in fees” on a maximum award of $250,000.
The law firm also argued the laws give defendants an incentive to run up the costs of litigation, leaving plaintiffs, “at least in terms of expert witnesses, to only be able to bring a knife to the defendant’s gunfight.”
The AG moved to dismiss the case, arguing the plaintiffs don’t have standing. In September 2020 a trial court agreed, ruling they hadn’t suffered any injuries giving them the right to challenge the law. The Fifth District Court of Appeal affirmed the dismissal in an opinion published Jan. 3.
The California Legislature passed Section 3333.2 in 1975 limiting noneconomic damages to $250,000, citing the threat to the healthcare system of soaring malpractice insurance premiums. In 2014, voters rejected Proposition 46, which would have raised the cap to $1.1 million and adjusted it to inflation after that, and the California Supreme Court has repeatedly upheld both laws against constitutional challenges.
Business and Professions Code 6146 limits contingency fees to 40% of the first $50,000, 33.3% for the next $50,000, down to 15% of recoveries over $600,000.
The plaintiffs didn’t explain how CZR had any grounds for suing, the appeals court said, “nor are we able to discern a basis for CZR’s standing in this matter.” Further, the court said, there was no evidence in the record CZR had actually threatened to stop representing the plaintiffs or that they wouldn’t be able to present evidence.
“Even if we were to assume that heirs’ medical malpractice attorney will withdraw from the litigation, heirs have no due process right to an attorney in the medical malpractice case,” the court concluded. “Plaintiffs’ alleged injuries are neither concrete nor actual, and that they are, at the present time, conjectural and hypothetical.”
The plaintiffs were ordered to pay costs. The California Medical Association filed a brief in support of the state.