Motion-Secondary: Diana Blum, MD vs Sutter Health et al

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Theresa J. Barta, SBN 150995
BARTA LAW

4041 Macarthur Blvd., Ste. 280
Newport Beach, CA 92660-2537
Telephone: (949) 833-3383
Facsimile: (949) 209-2530
Email: theresa@barta-law.com

Charles M. Louderback, SBN 88788

Stacey L. Pratt, SBN 124892

LOUDERBACK LAW GROUP

44 Montgomery Street, Suite 2970

San Francisco, CA 94104

Telephone: (415) 615-0200

Facsimile: (415) 795-4775

E-Mail: — clouderback@louderbackgroup.com
spratt@louderbackgroup.com

Attorneys for Plaintiff
DIANA P. BLUM, M.D.

IN AND FOR THE STATE OF CALIFORNIA
COUNTY OF SANTA CLARA - UNLIMITED JURISDICTION

DIANA P. BLUM, M_D., Civil Case No. 2015-1-CV-277582

Plaintiff,
MEMORANDUM OF POINTS AND
v. AUTHORITIES IN SUPPORT OF
PLAINTIFF’S MOTION FOR NEW

SUTTER HEALTH, a California corporation, | TRIAL

PALO ALTO FOUNDATION MEDICAL . T

GROUP, INC., a California corporation; PALO Pate: ane

ALTO MEDICAL FOUNDATION, a Dept. 16

California corporation; and DOES 1 through 20,) Judge: Drew C. Takaichi

Defendants.

Complaint filed: March 4, 2015
Trial Date: January 8, 2018

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MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF PLAINTIFF’S MOTION FOR NEW
TRIAL; Case No. 2015-1-CV-277582Table of Contents

I. INTRODUCTION scsssssssossaasnosssssaronosasatsnssanaraovavevcnueseseasnencesnzereannseanesaesnronasysnqvenayeesaceneees

IL. SUMMARY OF LEGAL PRINCIPLES GOVERNING THIS COURT’S

AUTHORITY TO GRANT A NEW TRIAL .......cescesessssessesseneeeeneensnteneneeanescensenereneeneeeneey

I. LEGAL ARGUMENT
A. The Court Erred in Excluding Relevant Evidence of Policies and Procedures Via

Motions in Limine...........sececessececesseeseesessessessesssssssscsnecssesesucsuceecssesesueneensenseneeaeeneeneenes

B. The Court’s Exclusion of Plaintiff's Expert Dr. Label Was Irregular, Unfair, and

an Error Of Law’ sssssscsssvcessseszesveneonsesnseveessesqnosnvevessrcnscosscesovcssescnueassevenenssonesnonesnenasesnesonesye

C. It was Error to Exclude Relevant, Admissible and Non-Cumulative Evidence at

Trial... ccssssesssssecescoossvsenssnrevssrnntsversssessnesssoesonenstsnsaasnessesnnsuesseonssnssocossnsezsunenouereesasatsesnseren

1. — Testimony re Patient Questionnaire .........s.cssecsecssesssesssesssecnesceesaeenseeneeeneeneenccnsennesnaets

Evidence of Productivity (Budgeting of RVUs) as Business Practice

= +

5. | The Court Erred in Excluding Evidence of Plaintiffs’ Emotional Distress ..............

D. The Court Erred in Instructing the Jury on Occurrence of Agreed Condition
Precedent (CACTI 322)...

E. The Court Erred in Refusing to Give Plaintiff's Constructive Termination

Instruction (CACT 2510) .us.sssscessecssnssosscsessnesctecsssnscontsnscenbesncssesanesasentessvesnoesvonssnqnenessess

F. The Court Erred in Unilaterally Changing the Jury Instructions During

Deliberations ..c.cscssocssssceresvosoneaveresvessncensseseccnsenerensesersuenseseneessenenctssseaeassonsonenensanesnasonseen

G. The Court Erred in Changing the Special Verdict Form During Deliberations...
H. The Court Erred in Failing to Allow Plaintiff to “Re-Close” on the New

Instructions or New Applicability of the New Verdict Forms .........sssessssssesseseesseessees

I. The Court Erred in Granting Defendant’s Motion for Partial Nonsuit ...........scsesssesssees

J. It was Error for the Court to Deny Plaintiff's Motion to Reopen...

TV. — CONCLUSION... ..-cscsoscssssnscsnsssnsenseensessscansensennsconssaneenssenssanconssseensounennecensenocssenvensssoesse

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Exhibit 32: EMR: United Parkinson Scale .........sscsssssssssesssesesesesneeseeensesceeeneennees

Evidence re “Bastards” Language in Text Message ...........ssssesssssssessesesensneeeeseeneeaneee

MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF PLAINTIFF’S MOTION FOR NEW
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Cases

Alpert v. Villa Romano Homeowners Assn.
(2000) 81 Cal.App.4™ 1320...

Campbell v. General Motors Corp.
(1982) 32 Cal3d 112 cssccososnmeasoisandessnsimanacanssmer cman anrarn nvanenscnnmareens 11

Carson v. Facilities Development Co.
(1984) 36 Cal.3d 830 v.ceccecsessssessesssesnecsesecsesssssesessesssssessessessessessssnessesnssnssessessesseessesacsnsseesess 11

CC-California Plaza Associates v. Paller & Goldstein
(1996) 51 Cal App.4th: 1042, csescsnssossanswosnconnenssnnsasasszaeskercsssnasstecoseensusineistonsamnvestgearneceaonsese 1

Charles C. Chapman Building Co. v. California Mart

(1969) 2 Cal.App.3d 846
Golceff v. Sugarman

(1950) 36 Cal.2d U52 ssassssexsossssscsusssssncssnnpcarsaarnesausousasanvasansanianbevanssevoasenitsiesssavercosapasatpesnsiics 1
Khajavi v. Feather River Anesthesia Med. Grp.

(2000) 84 Cal. App.4! 32... eccssssssssssesscsssssseessesssssseecssssssnsuessesssssssneeessssnsssecensssnensssnsssestte 3,5
Korea Supply Co. v. Lockheed Martin Corp.

(2003) 29 Cal.4” 1134 sisssanacnamcnnenatamancnmumncenananiacmnmienunmmnanci 1
People v. Fruits

(2016) 247 Cal. App.4! 198......ccsssssssessescesssesssssssnesseseeessneeteesesesssnessssssssneesssssneeessesnnnesesee 2.
People v. Sakarias

(2000) 22 Cal. A™ 596 sccssssocesscccesssaseeasssssncassounssncarsaswusestenveanccansmnnn ansauinnchoues asnapunaiinsnaniciand 8
Platt Pacific, Inc. v. Andelson

(1993) 6 Cal 4 307 ooncsessssssessscecsssessseesscceccsssessesesnnssesesseessnnsessseeseesssesessessansesessesueesssossnnsecs 9
Sarka v. Regents of the Univ. of CA

(2006) 146 Cal-Agip.4" 261 ssccsssssrscvcrmsccre merc rennsemnonananennnentamanmncrnmannammenannmatirs 3

Statutes

Bus;:86 Pro€: Code § 2056 ssscarscsssusssvssvonscarnsacsceresansveseonvovnnenesenasnasseonpavenerseenncausennacepecageosccegpange passim
Code Civ. Proc. § SR 0 acini taint i indica Asana anaaRAaAARReaARRRaEA ARRAS 14
Code Civ. Proc. § 657 ....sessssscsssssssssesesssenssssnarsssesesnsnscscsesssssssesssessscenscsssesssnseeesseenseeeneesceeeaaees 1, 3, 6, 12
Code: Civ: Proc: §:660 sss scssesescssusenosesecarssensnsnswsscsnesesnsasaseussnasaatnanssonavansnansisiannsnssnes enssnosusnagsesssoveenasvence 1

Evid. Code § 356...

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MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF PLAINTIFF’S MOTION FOR NEW
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Health & Safety Code § 1373.95 .....ssscsecsessesescsessssesssessesecsessssessecsesssesssessnssnessansensseesesseeseseseseageceneeae 2
Other Authorities

7 Witkin, Cal.Procedure (3d ed. 1985) Trial, § 409.
9 Cal Tre: 558-559 sessecsscssscessssesssessansncescaeueesmuanercurcvensrusinsisearsestussavevesvstsessevorntsnienssnsnsssnvencaenasbenneticssie 11
CACI NO, 2510 scssssacavssncsscascavsansscacsonosnacncanveanevannsesisaepahsasensestansesestunemazuscnensvawsnsesvenwacesuseescennsassauecateed 9
CACI NO. 300 uoesseessesssecssscsssseessecsesssccsnsssesssnecssessnessnesnssssecascanecsucsscssessseessceseenscansecanecneeenecseauesneeesecees 10
GAGT No, 3034 -srscssecsssenscenezsunancepsnnsesnusesnesnncaserosssennnescocorcesscgesteuscusnesitassoasabiniasennetensnasensanennonnenerss 9
CACI No. 322..
CACI No. 3900
CACI No. 3902

CACI No. 3905

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L INTRODUCTION

Plaintiff Diana Blum, M.D. (“Plaintiff”) brings this motion for new trial pursuant to Code
of Civil Procedure section 657 because, by virtue of the Court’s erroneous rulings, she was
prevented from presenting relevant evidence at trial; the Court erred in granting partial nonsuit in
favor of Defendant Palo Alto Foundation Medical Group (“Defendant”) and in failing to grant
Plaintiff's motion to reopen in its entirety; and the Court gave incorrect jury instructions and
erred in changing the verdict forms during jury deliberations. The Court should thus order a new

trial.

Il. SUMMARY OF LEGAL PRINCIPLES GOVERNING THIS COURT’S
AUTHORITY TO GRANT A NEW TRIAL

Code of Civil Procedure section 657 authorizes this Court to grant a new trial on any of
several grounds, including but not limited to: “1. Irregularity in the proceedings of the court, jury
or adverse party, or any order of the court or abuse of discretion by which either party was
prevented from having a fair trial.... 7. Error in law, occurring at the trial and excepted to by the
party making the application.” Code of Civil Procedure section 660 sets forth the evidence that

may be considered in relation to Plaintiff's motion for new trial.
I. LEGAL ARGUMENT

A. The Court Erred in Excluding Relevant Evidence of Policies and Procedures
Via Motions in Limine

On motions in /imine and in trial, the Court erred in excluding relevant evidence
regarding the policies and procedures Plaintiff complained about as adversely affecting her
ability to render appropriate patient care. The Court erred in granting Defendants’ Joint Motion
in Limine No. 1 to exclude evidence and references to coding, including but not limited to HCC
coding, described by Defendants (erroneously) as “an alleged policy and practice of having

physicians ‘over-code’, i.e., code at a higher level than appropriate to increase reimbursement

! The procedural history underlying this motion is set forth in detail in the Declaration of Theresa
Barta in Support of Plaintiff's Motion for New Trial, filed herewith.

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rates form third party payors.” (Declaration of Theresa J. Barta in Support of Plaintiff's Motion
for New Trial (“Barta Decl.”), 62, Exh. B, RT 1/9, 40:24-46:14), Exh. AA (Defendants’ MIL 1,
5:24-26).)

HCC coding was a practice directly impactful to Plaintiff's care of patients. She testified
in deposition that she did not engage in this practice because it eroded the limited time she had
with her patients, who had complex neurological issues — and thus impacted patient care. (Barta
Decl., 463.) Plaintiff complained about HCC coding because it was a practice that impaired her
ability to provide medically appropriate health care. (/d., Exh. B, RT 1/9, 40:24-42:6.) This
issue was highly relevant, because, as Plaintiffs counsel argued, HCC Coding “goes to the 2056
[claims], which is the underpinning of the constructive termination, the underpinning of the fifth
and sixth cause of action and the 17200.” (/d., J 63, Exh. B, 1/9, 45:26-46:6.)

This ruling was error and precluded Plaintiff from presenting evidence at trial of this
policy that she protested while advocating for medically appropriate healthcare. (Barta Decl., {
64.) (See People v. Fruits (2016) 247 Cal.App.4™ 198, 205 (“{T]he prejudice which exclusion of
evidence under Evidence Code section 352 is designed to avoid is not the prejudice or damage to
a defense that naturally flows from relevant, highly probative evidence.”) Specifically, this was
error because the Court conflated the concepts of upcoding for third-party billing purposes and
HCC coding for diagnostic purposes and precluded Plaintiff from introducing relevant evidence
to demonstrate this important distinction at trial.

In response to Motion in Limine 1, Plaintiff sought to introduce evidence of continuity of
care, including evidence of internal policies regarding continuance of care with a terminated
provider (Exh. 79) and continuity, coordination and transition of care (Exh. 80), and the laws
referenced therein (i.e., Health & Safety Code § 1373.95.) (Barta Decl., 45, Exh. QQ.) These
policies, in keeping with Section 1373.95, permitted a patient to keep their physician for up to 12
months after termination under certain conditions. The Court excluded “evidence as to
continuity of care, that particular issue as to the fifth and sixth causes of action having to do with
the intentional interference and negligent interference with prospective economic advantage,”

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(d., §40, Exh. B, RT 1/9, 31:22-32:2), and then clarified that its ruling “applies to all
defendants.” (/d., §41, 35:27-36:1.) The Court later revisited the issue, and extended the ruling
to breach of contract. (/d., 143, Exh. D, RT 1/18, 29:6-32:12.) After the nonsuit, the Court
further extended its ruling, excluding the internal policies regarding continuity of care as to the
remaining causes of action for intentional interference with prospective economic relations, and
breach of contract. Here, the Court ruled that, as to the failure to “follow this policy and perhaps
the law” (Id., Exh. D, RT 1/18, 42:7-17), the “probative value to — that the specific allegations
and contentions in this case is pretty thin. And I still have the feeling that the potential of
confusing the issues to the jury, as well as the significant amount of time afforded for this”
would detract from the focus of the case. (Id., 42:7-43:11.)

Excluding this highly relevant evidence was further prejudicial error. Plaintiff contended
that Defendant breached her employment agreement and interfered with her prospective
economic relations in failing to provide her contact information to her patients. Internal policies
and the underlying laws were the cornerstone of her claims for Section 2056 retaliation and
constructive discharge. And, as discussed below, Plaintiff's failure to provide evidence of

policies grounded in law was used against her as grounds for granting partial nonsuit.

B. The Court’s Exclusion of Plaintiff's Expert Dr. Label Was Irregular, Unfair,
and an Error of Law

A further, independent cause for a new trial exists due to the Court’s improper exclusion
of Plaintiff's expert witness Dr. Lorne Label. The exclusion of Dr. Label materially affected the
substantial rights of Plaintiff, constituted an error in law at trial (Code Civ. Proc. § 657(7), and
prevented Plaintiff from having a fair trial (Code Civ. Proc. § 657(1).). Section 2056 was
enacted to prevent physicians from retaliation when they “advocate[e] for medically appropriate
health care.” Whether the advocacy was “medically appropriate” requires expert testimony from

a physician? “with “like degree of learning and skill.” (Bus. & Prof. Code § 2056.) Accordingly,

2 See Sarka v. Regents of the Univ. of CA (2006) 146 Cal.App.4" 261, 273; Khajavi v. Feather
River Anesthesia Med. Grp. (2000) 84 Cal.App.4" 32, 42.

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Plaintiff retained and designated Dr. Label — a full time Neurologist with over 30 years of
practice — to support her case. (Barta Decl., 16.)

Dr. Label’s “Scope of Expertise” was “Neurology and whether or not protests about
policies and practices that affect a neurologist are medically appropriate.” (Barta Decl., 416, Exh.
E, RT 1/19, 128:18-21.) Dr. Label testified to his experience and qualifications on January 19,
2018, and on January 24, 2018, Plaintiff filed her “Memorandum re: Motion to Qualify Dr.
Lorne Label as an Expert Witness with Regard to Plaintiff's ‘Advocacy’ Per Bus. & Prof. Code
Section 2056.” (Barta Decl., 17, Exh. GG.) Plaintiff set forth the topics of expert testimony and
the specific questions that Dr. Label would opine on, including the following key topics in
relation to Plaintiff's Section 2056 claim: Questionnaires; Printing of Chart Notes: ‘Parkinson’s
Disease Rating Scale’, Reminder Calls, Length of Patient Visits (60 minutes vs. 30 minutes);
Referral for CT Angiogram Outside of PAMF (Leakage); and Referral for Physical Therapy
Outside of PAMF (Leakage). (/d., Exh. GG.)

Evidence about Dr. Label’s knowledge, skill, experience, training, and education was
presented in Plaintiff's case-in-chief. (Barta Decl., 18.) Plaintiff established that he had been a
full time neurologist for the past 35 years seeing both adult and pediatric patients, taught
neurology to residents and medical students; completed both a Residency and a Fellowship in
neurology, and has been Board Certified in neurology since 1984. Dr. Label further testified that
for the past three years, he has been employed by the UCLA Health System, and prior to that was
in private medical practice for 32 years. (/d., J18, Exh. E, RT 1/19, 131:12-132:4.)

Dr. Label’s testimony at trial showed that he has special knowledge, skill, and experience
in each of the following “decision, policies and practices”: RVU production (RT 1/19, 133:2-
134:14); length of time of patient visit re: various illness (RT 1/19, 136:7-137:20); referral
guidelines for referring patients to other physicians (RT 1/19, 136:7-137:20); referrals of
neurology patients for physical therapy (RT 1/19, 137:21-24); referrals of neurology patients for
CT Angio scans (RT 1/19, 137:21-138:25); use of EMR (RT 1/19, 140:22-141:13); use of
questionnaires for various types of neurologic conditions (RT 1/19 141:14-23); reminder calls to

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patients (RT 1/19, 141:24-142:25); prescription of generic medications (RT 1/19, 144:16-26);
and use of sample medications (RT 1/19,144:16-26). (Barta Decl., 18, Exh. E) The Court
acknowledged Dr. Label’s expertise on multiple occasions. PAFMG’s attorney admitted that
Dr. Label was competent and it would be proper for him to say whether it would be appropriate
to refer a Parkinson’s patient out for physical therapy. (Id., 20, Exh. B, RT 1/9, 99:25-100:2).
Thus, Dr. Label was specifically qualified to provide an expert opinion on whether Plaintiff's
ability to provide medically appropriate health care as a neurologist was, or would be, impaired
by Defendants’ policies. (See Bus. & Prof. Code §2056 (b).)

Yet, despite the clear language of Section 2056, the Court excluded Dr. Label from
testifying, ruling that no expert opinion was needed on the subjects of questionnaires, printing
from patients file, reminder calls, length of patient appointments, and length of time between
appointments. (Barta Decl., (21, Exh. H, RT 1/24, 211:27-212:10). Further, the Court ruled
that Dr. Label was not qualified to testify on the issue of referring to one facility over another for
CT Angio scans (/d., RT 1/24, 206:24-207:10) or the referral of Parkinson’s patients for physical
therapy. (/d., 207:11-16).

The Court’s exclusion directly contradicts the public policy behind Section 2056 to
“protect physicians’ exercise of their professional judgment in advocating for medically
appropriate health care, without limitation over the basis of the dispute.” (Khajavi, at 47-48)
(emphasis added). Moreover, this exclusion was prejudicial and harmful, because the Court later
ruled, as part of the basis for granting partial non-suit, that, “plaintiff did not have an expert
qualified to render an opinion for the medical appropriateness of that particular advocacy”
(referring to what the court called “administrative decisions and policies”), (Barta Decl., Exh. I,
RT 1/29, 8:1-5). Thus, the Court granted nonsuit directly because Dr. Label was excluded. Had
Dr. Label not been prevented from testifying, Plaintiff would have established all necessary

3 See Barta Decl., 19, Exh. H, RT 1/24, 200:12-14) (“Clearly at least from my point of view that
he’s an expert in general practice of neurology.”); Exh, E, RT 1/19, 153:18-24 (“If his opinions
are sought as to whether it was medically appropriate to refer a patient for some sort of
treatment, then I think he can testify about that.”)

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elements of her case-in-chief and nonsuit would not have been granted. The exclusion of Dr.
Label was unfair, irregular, and error of law and an abuse of discretion. Pursuant to Code of

Civil Procedure Section 657 (1) and (7), a new trial should be granted.

C. It was Error to Exclude Relevant, Admissible and Non-Cumulative Evidence at
Trial

1. Testimony re Patient Questionnaire
During trial, Plaintiff testified at length about her use of a patient questionnaire she
devised and used in her clinical practice (Exh. 31), the importance of the questionnaire in making
a diagnosis, and criticism she received for having her medical assistant distribute the
questionnaires to patients. (Barta Decl., 932, Exh. F, RT 1/22, 89:27-96:28.) Yet, when asked a
key question relating to the conditions surrounding her constructive termination -- whether she
believed that if she were not allowed to use her patient questionnaires it would have impaired her
ability to provide medically appropriate health care -- the Court sustained objections based on
relevance and “state of mind.” (/d., Exh. F, RT 1/22. 97:1-7.) Plaintiff's reasons for using the
questionnaires with patients were highly relevant to the issue of her working conditions, and
germane to the issue of patient care which permeated her causes of action for constructive
discharge, the Section 2056 retaliation claim, and the Section 17200 claim. And to the extent
that the Court sustained counsel’s “state of mind” objection, this was not a valid objection, as
Plaintiff's testimony as to her own views about patient care is within her personal knowledge and
admissible evidence.
2. Exhibit 32: EMR: United Parkinson Scale
While the Court admitted Exhibit 31 (patient questionnaire) into evidence, the Court
erred in excluding Exhibit 32,4 based on Defendant’s objections that the document was a medical
record from Plaintiff's current practice and irrelevant. (Barta Decl., (33, Exh. F, 1/22 RT, 99:27-

102:28.) However, the foundation was laid that the motor examination listed on this document

4 Plaintiff's counsel requested that only the “portion starting with PE and general regarding to the
United Parkinson’s Disease Rating Motor Examination admitted into evidence.” (Barta Decl.,
436, Exh F, RT 1/22, 102:19-28.)

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MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF PLAINTIFF’S MOTION FOR NEW
TRIAL; Case No. 2015-1-CV-277582was a “standardized tool that is used when you see Parkinson’s patients... to understand where in
their disease course they were” (/d., 99:27-100:16), and the reasons why Plaintiff wanted to have
this EMR printed out in advance of patient visits. (/d., 95:27-98:4; 100:17-26.) Moreover,
Plaintiff used this same scale in her practice at PAFMG (Jd., 101:28-102:4). The Court erred in
excluding this evidence based on relevance.
oe Evidence of Productivity (Budgeting of RVUs) as Business Practice

On direct, Plaintiff testified she received an email (Exhibit 46)° from Dr. Gershfield that
had to do with “budgeting for RVUs,” which occurred every year. (Barta Decl., 439. Exh. F, RT
1/22, 152:8-22.) Although Plaintiff, a physician knowledgeable about the business of her own
medical group, was permitted to testify, without objection, that she wrote her email to the
department chair as “part of her business,” when asked the corollary question whether budgeting
of RVUs was “part of the business practice of the Medical Group,” objections based on
speculation and lack of foundation were sustained and her affirmative answer stricken. (Jd., 438,
Exh. F, 152:24-153:2.) This was error. Exhibit 46 originated as a routine request for budgeting
information fo her. Plaintiff was competent to testify based on her personal knowledge that this
yearly budgeting for RVUs was a business practice of the group, and this did not call for
speculation on her part. (See Evid. Code §702.)

4. Evidence re “Bastards” Language in Text Message

The Court granted Defendant’s motion in limine No. 2 to exclude “me too” evidence
regarding other physicians. The ruling was broad enough to encompass Exhibit 89, a text
exchange between Plaintiff and one of those physicians. In that exchange, Plaintiff responded:
“They did that to me. They want doctors who fit a certain profile, caring for patients and doing
the right thing is not it... They are such bastards...” (Barta Decl., $57.) However, defense
counsel opened the door by referencing that same text when she asked Plaintiff: “You yourself

described my clients — the Physicians Group, PAMF and Sutter Health — as bastards in a text

5 Exhibit 46 was admitted into evidence with no objection. (Barta Decl., 939, Exh. F, RT 1/22,
153:14-16.)

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TRIAL; Case No. 2015-1-CV-277582message, correct?” (/d., 455, Exh. H, RT 1/24, 159:17-20.) On redirect, when Plaintiff's counsel
attempted to elicit testimony to provide context for Plaintiff's statement, the Court sustained
defense counsel’s objection. (/d., ] 56, Exh. H, RT 1/24, 232:28-234:26.) It was error for the
Court to allow Defendant to elicit testimony regarding the contents of an exhibit it successfully
sought to exclude - and to then sustain Defendant’s objections to Plaintiff's redirect on this same
issue. See e.g., People v. Sakarias (2000) 22 Cal.4"" 596, 644 (held, no error in allowing redirect
on same subject where questions regarding excluded statement “opened the door, under Evid.
Code § 356, to a fuller exploration of the contents of those statements.”)
5. The Court Erred in Excluding Evidence of Plaintiffs’ Emotional Distress

Similarly, the Court excluded evidence of two patient inquiries about Plaintiff and the
disruption of their care following her separation (Exhibit 12, 84), as well as Plaintiff's own
testimony about how she felt about leaving patients behind (Barta Decl., { 947-49, Exh. G, RT
1/23 46:25-47:6; 47:8-14; 47:16-23; 51:9-23; 64:5-25; 65:13-23. Exhs. RR, SS), all which were
highly relevant to her emotional distress damages. Once again, Court erred in excluding such
evidence under Evid. Code §352 (Exhibits 12, 84) and as evidence of Plaintiff's “state of mind.”
The patient emails were more probative than prejudicial, and should not have been excluded as
such. Furthermore, with respect to the issue of Plaintiff's testimony that she felt distress about
leaving her patients behind, evidence of Plaintiff's own feelings was not only relevant, but

essential to her claim for emotional distress.

D. The Court Erred in Instructing the Jury on Occurrence of Agreed Condition
Precedent (CACI 322)

Over Plaintiff's objection, the Court gave an instruction based on CACI 322 that
provided in part, “Dr. Diana Blum and the Physician Group agreed in their contract under
Section 10.2.2 that the Physician Group would not have to obtain a vote of seventy-five (75%) of
the [Physician] Group Shareholders unless the Physician Group terminated the contract.”
(Emphasis added.) (Barta Decl., 423, Exh. HH.) “Under the law of contracts, parties may

expressly agree that a right or duty is conditional upon the occurrence or nonoccurrence of an act

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MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF PLAINTIFF’S MOTION FOR NEW
TRIAL; Case No. 2015-1-CV-2775820 em NY DH FB WN

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or event.” (Platt Pacific, Inc. v. Andelson (1993) 6 Cal.4™ 307, 313). However, this instruction
‘was an inaccurate statement of the parties’ contract, and confusing. It was error to give this
instruction, objected to by Plaintiff, which interjected a purported condition precedent, when no
such agreed upon condition precedent existed in Section 10.2.2.

Section 10.2.2 provided:” By Medical Group: “Termination without cause procedures
by Medical Group shall be initiated by the Medical Group’s Board of Directors and require a
vote of seventy-five percent (75%) of the Medical Group Shareholders...”) (Barta Decl., 423,
Exh. M, [emphasis added.]) Testimony of Dr. Smith echoed this language: “To be terminated
without cause required a 75 percent vote.” (/d., 24, Exh. C, RT 1/17, 40:22-41:14.) Section
10.2.2 does not state that the 75% vote is not required unless the Physician Group terminated the
contract. Rather, it states that termination without cause procedures shall be initiated by the
Board of Directors and require a 75% vote -- the means by which the shareholder may be
terminated. As set forth below, the error in giving this instruction was compounded by the fact
that the Court rewrote Verdict Form 1 to require the jury to first consider whether “ail conditions
that were required” occurred on the breach of contract claim with respect to Section 10.2.2.
Both were error.

E. The Court Erred in Refusing to Give Plaintiff's Constructive Termination
Instruction (CACI 2510)

The Court also erred in refusing to give Plaintiff's proposed CACI 2510 instruction on
constructive termination. (Barta Decl., 25, Exh. K.) Had the instruction been given, which
refers specifically to a person “resigning,” the jury would have been informed that they could
still find a breach of Section 10.2.2., (which refers to a “termination”), even though Plaintiff had
submitted a “resignation.” This error was significant, because the damages here would have
been Plaintiff's “economic damages” which Plaintiff's economist Darryl Zengler calculated as
between $445,000 and $950,000. (/d., 9g., Exh. O. (Exh. 106.)®

6 The Court also omitted, over Plaintiff's objection, “damage to reputation” as one of the
itemized damages recoverable by Plaintiff from CACI 3900, CACI 3902, CACTI 3905, and CACI
3034. (Barta Decl., 30-31, Exh. MM.)

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MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF PLAINTIFF’S MOTION FOR NEW
TRIAL; Case No. 2015-1-CV-277582F. The Court Erred in Unilaterally Changing the Jury Instructions During
Deliberations

During deliberations, the Court unilaterally modified the original CACI 300 (breach of
contract) read to the jury.” The modified instruction removed the 4-paragraph summary of the
provisions of Sections 4.6 and 10.2.2 and replaced it with a truncated version of Plaintiff's
claims of breach. (Barta Decl., 926, Exhs. II, JJ..) The Court erred in removing part 1 of the
form CACTI instruction: “[insert brief summary of alleged contract]” and modifying the
instruction in this manner. Plaintiff never had the opportunity to argue these changes, and
objected to these changes made during jury deliberations. (/d., 427.)

G. The Court Erred in Changing the Special Verdict Form During Deliberations

The Court also, over Plaintiffs objection, changed Verdict Form 1 during deliberations
so that the jury’s first question on Section 10.2.2. of the contract (question 4) read: “As to Section
10.2.2 of the Shareholder Employment Agreement, did all the conditions that were required for
the Physician Group’s performance occur?” (Barta Decl., {| 28-29, Exhs. KK, LL.) The jury
responded, “No,” and thus was instructed to proceed to Verdict Form 2. As such, the jury never
reached the question whether Defendant breached Section 10.2.2. As noted above, because the
Court gave the erroneous CACI 322 which mischaracterized Section 10.2.2 as a “condition
precedent,” removed the summary of the contract terms from CACI 300, and imbedded this
“condition” question in Verdict Form 1 as to Section 10.2.2, it caused the jury to first answer
whether a condition precedent that did not exist in the contract had occurred. This was error.

The Court also unilaterally, during deliberations, changed Verdict Form 2 (Intentional
Interference with Prospective Economic Relations) to limit “wrongful conduct to “deceitful
conduct” and breach of contract, and added the question: “Did the Physician Group engage in
deceitful conduct?” (Barta Decl., 28, Exhs. LL.) For purposes of the interference claim, “an act
is independently wrongful if it is unlawful, that is, if it is proscribed by some constitutional,

statutory, regulatory, common law, or other determinable legal standard.” (Korea Supply Co. v.

7 The Court similarly modified CACI 336. Affirmative Defense — Waiver. (Barta Decl., 425.)

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MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF PLAINTIFF’S MOTION FOR NEW
TRIAL; Case No. 2015-1-CV-277582Lockheed Martin Corp. (2003) 29 Cal.4" 1134, 1159.) The court erred in changing the verdict

form in this manner during deliberations.

H. The Court Erred in Failing to Allow Plaintiff to “Re-Close” on the New
Instructions or New Applicability of the New Verdict Forms

Because the Court changed the jury instructions and verdict forms during deliberations,
Plaintiff should have been allowed to “re-close.” As she was not given this opportunity, she was
deprived of the ability to argue the revised instructions and verdict forms on which the jury
rendered its verdict. (Barta Decl., 29.) Since the jury found against Plaintiff on the cause of
action for interference with prospective economic relations, and on the second part of her breach
of contract claim under Section 10.2.2 — the Court’s failure to permit Plaintiff to re-close
warrants a new trial.

I. The Court Erred in Granting Defendant’s Motion for Partial Nonsuit

A motion for nonsuit is an extraordinary form of relief that takes a case from the jury’s
consideration, and should only be granted under very limited circumstances. (See Carson v.
Facilities Development Co. (1984) 36 Cal.3d 830, 838.) A court may not grant a motion for
nonsuit “if plaintiff's evidence would support a jury verdict in plaintiff's favor.” (Campbell v.
General Motors Corp. (1982) 32 Cal.3d 112, 117-118) (emphasis added.) In ruling on the
motion, the court “does not consider credibility of witnesses but gives to the evidence of the
party against whom it is directed all its legal value, indulges every legitimate inference from
such evidence in favor of that party, and disregards conflicting evidence.” (CC-California
Plaza Associates v. Paller & Goldstein (1996) 51 Cal.App.4th 1042, 1050 citing 7 Witkin,
Cal.Procedure (3d ed. 1985) Trial, § 409, p. 412) (emphasis in original.) “If there is any doubt, it
is the duty of the court to let the case go to the jury.” (Golceff v. Sugarman (1950) 36 Cal.2d
152, 153 citing 9 Cal.Jur. 558-559.)

After excluding key evidence and testimony from Plaintiff's case-in-chief, on February 7,
2018, the Court granted PAFMG’s Motion for Partial Nonsuit, finding in part:

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MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF PLAINTIFF’S MOTION FOR NEW
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[A]s a matter of law that the evidence presented by Plaintiff is insufficient to

permit a jury to find in Plaintiff's favor as against the Physician Group with respect

to the first cause of action for wrongful (constructive) termination in violation of

public policy and the second cause of action for retaliation in violation of Business

and Professions Code section 2056. The Court therefore grants the Physicians

Group’s motion for partial nonsuit and these claims are dismissed. (Barta Decl., 96

Exh. J, Order, 2:1-5 [emphasis added].)

The Court’s Order prevented Plaintiff from having a fair trial and was an error of law.
(See Code Civ. Proc. § 657.) The evidence below demonstrates that, when accepting as true the
evidence most favorable to Plaintiff and disregarding conflicting evidence, and indulging every
legitimate inference that may be drawn from the evidence in Plaintiff's favor, there was
sufficient evidence to permit a jury to find in Plaintiff’s favor as to her first and second causes
of action.

Plaintiff's case revolved around the question of whether Defendants constructively
terminated Plaintiff for “advocating for medically appropriate health care”®. (Bus. and Prof.
Code § 2056.) “Advocating for medically appropriate health care” means to protest? a decision,
policy or practice that the physician believes impairs the physician’s ability to provide medically
appropriate health care to his or her patients. To establish this claim, Plaintiff must prove all of

the following:

That Plaintiff was employed by the PAFMG; (2) that Plaintiff “advocated for
medically appropriate health care”; (3) that PAFMG constructively discharged
Plaintiff principally for her “advocating for medically appropriate health care”; (4)

8Special Instruction 3 -- Meaning of “To Advocate for Medically Appropriate Health Care”
explains that “To advocate for medically appropriate health care” means:

To protest a decision, policy, or practice that the physician, consistent with that degree of
learning and skill ordinarily possessed by reputable physicians practicing according to the
applicable legal standard of care, reasonably believes impairs the physician’s ability to
provide medically appropriate health care to his or her patients.

(Barta Decl., 97, Exh. K.)
° Special Instruction 4 provided the definition of “Protest” as, “making a complaint, statement,

objection, or display of unwillingness or disapproval of something, such as an idea or a course of
action.” (Barta Decl., 7, Exh. K.)

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MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF PLAINTIFF’S MOTION FOR NEW
TRIAL; Case No. 2015-1-CV-277582that Plaintiff was harmed; and (5) that PAFMG’s constructive discharge of Plaintiff

was a substantial factor in causing her harm.

During her case-in-chief, Plaintiff presented evidence sufficient to satisfy all of the above
elements of proof for a jury to find in her favor on her claims for wrongful (constructive)
termination and violation of Section 2056, including the only element at issue on the motion for
nonsuit, whether Plaintiff “advocated for medically appropriate health care.”

As set forth below, and in greater detail in the Barta Declaration, Plaintiff presented
evidence at trial to establish that Plaintiff “protested” the following policies, procedures or
decisions that were the subject of Plaintiff's repeated complaints and other efforts to advocate for
medically appropriate health care: (1) Use of Questionnaires and the Lean Program; (2) Print-
Outs of the Unified Parkinson’s Scale and Notes from Patient’s Previous Patient Exams;'! (3)
Patient Reminder Calls;!? (4) Referrals to Out-of-Network Providers (“Leakage”); (5) Generic
Medications;!* (6) Prescription Renewals;'‘ (7) Throughput and Patient Visit Duration;!° (8)
Length of Time Between Patient Visits;'7 (9) Productivity Budgets and RVU Production.'*

Mt

10 (Barta Decl., ff 11(a), 12(a), Exh. F, RT 1/22, 91:23-25; 94:25-95:2; 95:3-11; 95:15-96:4;
96:17-28; 98:10-17, 134:22-135:3; 164:23-165:2, 170:5-11, 179:28-180:4; Exh. G, RT 1/23,
8:25-9:15; Exh. C, RT 1/17, 107:22-108:1).

' (Barta Decl., ff 11(b), 12(b), Exh. F, RT 1/22, 99:27-100:26, 175:10-18; 103:2-12; 180:5-7;
174:28-175:18.)

2 Barta Decl., ff 11(c), 12(c), Exh. F, RT 1/22 37:7-18; 110:24-111:10; 138:28-139:6; 109:7-
110:8, 111:22-112:2; 111:15-21; Exh. G, RT 1/23, 10:2-24).

8 (Barta Decl., ff 11(d), 12(d), Exh. F, RT 1/22, 53:17-21; 54:4-55-3, 55:25-56:1; 139:1-11,
141:24-145:11, 143:23-144:7, 144:22-25; Exh. D, RT 1/18, 72:1-10, 75:5-76:16, 120:2-9.

4 (Barta Decl., {] 11(c), 12(e), Exh. D, RT 1/18, 205:20-206:8; 224:8-25, Exh. F, RT 1/22,
147:9-16.)

'5 (Barta Decl., ff 11(f), 12(f), Exh. D, RT 1/18, 257:14-258:8; Exh. F, 1/22, 149:10-150:2.)
16 (Barta Decl., ff 11(g), 12(g), Exh. F, RT 1/22, 120:20-121:6, 121:7-28,122:1-14, 126:6-21,
127: 17-128:3,128:2-27,170:5-11; Exh. G, RT 1/23, 7:24-8:8.)

7 Barta Decl., ff 11(h), 12(h), Exh. F, RT 1/22, 150:27-151:14; 151:3-19.)

'8 Barta Decl., ff 11(, 12(), Exh. F, RT 1/22, 152:10-13, 155:1-3, 153:27-154:28, 155:1-8;
154:18-24; 155:9-11, 156:11-15.)

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MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF PLAINTIFF’S MOTION FOR NEW
TRIAL; Case No. 2015-1-CV-277582Bw N

J. It was Error for the Court to Deny Plaintiff's Motion to Reopen

Plaintiff moved to reopen her case-in-chief to present additional evidence, supported by
an offer of proof identifying the additional evidence that would be presented, including nineteen
witnesses on evidentiary issues relating to Defendants’ policies and procedures, including the use
of questionnaires, patient reminder calls, out-of-network referrals, throughput and brand name
medications. (Barta Decl., 14, Exh. EE, FF.) The Court acknowledged that Plaintiff “did an
offer of proof of what she would propose to proffer as additional evidence” (Barta Decl., 15,
Exh. I, RT 1/29, 13:12-15), however, the Court granted the motion only as to Dr. Gershfield, and
only on one subject — Defendants’ policies and practices regarding “throughput.” (Id., Exh. I, RT
1/29 13:6-14:16.)

“After a motion for nonsuit is made in a jury trial (Code Civ. Proc. § 581(c)), it is the trial
court’s duty, if so requested, to permit the plaintiff to reopen his case and introduce further
evidence, since one of the objects served by the motion is to point out the oversights and defects
in the plaintiff's proof so that he may supply, if possible, the specified deficiencies.” (Charles C.
Chapman Building Co. v. California Mart (1969) 2 Cal.App.3d 846, at 858.) “The denial of a
request to reopen which is accompanied by an offer of proof of the evidence that will cure the
deficiency is reversible error.” (Alpert v. Villa Romano Homeowners Assn. (2000) 81 Cal.App.4
1320, 1337, as modified on denial of reh’g (June 30, 2000).) Here, it was error for the Court to
deny Plaintiff's request which was accompanied by an offer of proof that would cure any alleged
deficiencies. Specifically, the evidence would further establish the policies and procedures
underlying Plaintiff's section 2056 claim, which also relates to the public policy underlying her
claim for wrongful (constructive) termination. The evidence set forth in relation to Plaintiff's
protests and Defendants’ policies and procedures is substantial and far beyond a “mere scintilla.”
(Barta Decl., Exh. I, RT 1/29, 13:6-14:6.) It was error to not allow Plaintiff an opportunity to
cure any deficiencies after her offer of proof.

Ml

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MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF PLAINTIFF’S MOTION FOR NEW
TRIAL; Case No. 2015-1-CV-277582IV.

CONCLUSION

Based upon the foregoing, and any further matters and argument that may presented on

this motion, Plaintiff Diana P. Blum, M.D. requests that the Court grant this motion, and enter an

order granting her a new trial in this action.

BARTA LAW

DATE: March 19, 2018 Ny (Uy lowe

DATE: March 19, 2018

Theresa J B:
Attorney for Plaintiff
DIANA P. BLUM, M.D.

LOUDE CEP LAW GROUP

ows ¥. “Touderback
Stacey L. Pratt
Attorneys for Plaintiff
DIANA P. BLUM, M.D.

00022136 vi4 -15-

MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF PLAINTIFF’S MOTION FOR NEW
TRIAL; Case No. 2015-1-CV-277582PROOF OF SERVICE

I, Jung Shin, am employed in the City and County of San Francisco, State of California. I
am over the age of eighteen years and not a party to the within-entitled action. My business
address is 44 Montgomery St., Suite 2970, San Francisco, CA 94104, and email address is
Jshin@louderbackgroup.com. On March 19, 2018, I served the foregoing document(s) described
as:

e MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF

PLAINTIFF’S MOTION FOR NEW TRIAL

on the following persons in this action by placing a true copy thereof enclosed in sealed

envelope(s) with postage thereon fully prepaid and addressed as stated below:

Attorneys for Defendants
SUTTER HEALTH and PALO ALTO MEDICAL FOUNDATION

Lindbergh Porter, Jr. Iporter@littler.com
LITTLER MENDELSON PC

333 Bush St F134

San Francisco, CA 94104

Maiko Nakarai-Kanivas mnakaraikanivas@littler.com
LITTLER MENDELSON PC

1255 Treat Blvd Ste 600

Walnut Creek, CA 94597

Attorney for Defendant
PALO ALTO FOUNDATION MEDICAL GROUP, INC.

Marcie Isom Fitzsimmons misom@grsm.com
GORDON REES LLP

275 Battery St Ste 2000

San Francisco CA 94111

Xx] BY U.S. MAIL: I am readily familiar with my firm’s practice of collection and
processing correspondence for mailing with the Unites States Postal Service. Under that
practice, correspondence will be deposited with the U.S. Postal Service on this same day
with postage thereon fully prepaid at San Francisco, California, in the ordinary course of
business.

[] BY OVERNIGHT DELIVERY OVERNIGHT: I caused such envelope(s) to be
delivered by Federal Express, next business day delivery to the addressee(s) listed above.

00022136 v15 -16-
MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF PLAINTIFF’S MOTION FOR NEW
TRIAL; Case No. 2015-1-CV-277582So 0D mem ND HW BF WY

N NN NY NY NN KN NY Be Bee eee ew ew eB
oN DU FF BH KF So we ADH BF YW NY

—] BY E-MAIL: Additionally, I caused said documents to be prepared in portable
document format (PDF) for e-mailing and served by electronic mail on March 19, 2018
as indicated above. That the document was served electronically and the transmission
was reported as complete and without error.

[] BY PERSONAL SERVICE: I caused the said document(s) to be served by hand
delivery to the offices of the addressee(s) listed above.

I declare under penalty of perjury under the laws of the State of California that the

foregoing is true and correct. Executed on March 19, 2018 at San Francisco,California.

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MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF PLAINTIFF’S MOTION FOR NEW
TRIAL; Case No. 2015-1-CV-277582