Jon C. Brissman, Esq. and Mona M. Nemat, Esq.
Riverside, California

By now, we have all heard that there is a “lien problem” in California. In fact, the legislature has gone to great lengths to combat this problem, including by enacting Senate Bill 863, a sweeping bill designed in part to reduce the backlog of liens before the Board and minimize the filing of new frivolous liens. The authors cannot help but to think that all these valiant efforts miss the mark. The problem is not necessarily that there are too many liens; the problem, from a practical standpoint, is the inefficiencies in the resolution process.

The common theme we see at lien conferences is that with few exceptions, neither lien claimants nor defense attorneys nor judges are prepared. Although 8 C.C.R. § 10770.1(e)(1) requires that parties “shall have sufficient knowledge of the lien dispute(s) to inform the Workers’ Compensation Appeals Board as to all relevant factual and/or legal issues in dispute,” compliance is 1) unusual and 2) rarely sanctioned.

All too often, a familiar scene plays out during a lien conference. The lien claimant representative is reviewing the “file” for the first time at the conference. Inevitably, they are missing documents and the background necessary to engage in effective negotiations. This lack of preparedness often, and perhaps rightfully, gives rise to animosity on the part of defense counsel. They, in turn, clam up and refuse to engage in anything productive.

The authors have also experienced the opposite situation. Because we prepare for each appearance, all too often we end up educating our counterparts on theunderlying issues of a case: why our client’s lien is valid and why compensation must be paid. The problem is that these discussions are often happening for the first time at the Board.

Lien claimant representatives who appear with only a bill from the provider prevent other parties from conducting a productive hearing. Similarly, defense attorneys or representatives who appear stating that they just were assigned the file and know little thereof are impediments to parties who arrived prepared.

Preparation can facilitate a fair and quick resolution. Below are a few practice tips we suggest.

Know Your Facts:

Knowing the basic yet imperative background facts will facilitate settlement by allowing for educated discussions. At a minimum, we submit that lien and defense representatives know the following about the services which are at issue:

  • Date(s) services provided (to verify that IBR does not apply)?
  • Was lien filed timely? If not, does some SOL exception apply?
  • Are there any assignment issues or exceptions?
  • Who ordered the services?
  • Must MPN issues be addressed?
  • What services were provided? Were they medical-legal?
  • Are there medical reports or supporting documentation?
  • Did U.R. address the services?
  • Are the charges controlled by a fee schedule? If so, what is allowed?
  • If no fee schedule, do you have an exhibit package per Kunz/Tapia?
  • Was objection sent timely? If so, was basis liability or amount charged?
  • From what date is any applicable interest to be calculated?
  • Are there any bad-faith issues?
  • What witness(-es) can help the court make its decision?
  • Have exhibits been served? If not, by what date will they be?

Know Your Law:

  • Lien claimant shoulders initial burden of proof.
  • Defendant has initial burden of proof for affirmative defenses.
  • Know UR, SOL, MPN, OMFS, §4603.2, §4622 laws and exceptions.
  • Know lien procedures via Regs. §10770, §10770.1 et seq.
  • Review WCAB panel and en banc decisions on specific issues involved.
  • Consider writing a brief to assist the judge on unusual issues.

Prepare A Pre-Trial Conference Statement:

All too often, unprepared lien claimants seek to continue the lien conference to avoid preparing the pretrial conference statement. Unprepared defense counsel often seek to take the hearing off calendar to allow for time to conduct a bill review. Either of these requests simply kick the can down the road and further perpetuate the “lien problem;” judges should accommodate such requests only in limited circumstances.

To the extent the parties are unable to settle, having an understanding of the background will also allow for a significantly more complete pretrial conference statement. If any issue, exhibit, or witness is not listed on the pretrial conference statement, it is off limits for trial purposes without a showing of good cause. (Reg.
§10770.1(f) and (h).)

Preparing the pretrial conference statement in advance of the lien conference is often one of the best ways to be prepared for the conference itself.

The parties should bear in mind that in the en banc decision Tito Torres v. AJC Sandblasting (77 Cal. Comp. Cases 1113 (2012)), the Appeals Board held that going to trial without sufficient evidence to support the party’s contentions can subject that party to sanctions. This applies equally to lien claimants and to the defense.

Communicate With The Other Side:

Reg. 10250(d) requires that the party filing a Declaration of Readiness state with specificity the good faith efforts undertaken to attempt resolution prior to requesting the court’s intervention. Our office settles more liens prior to filing DORs than subsequently and we find such resolutions to be far more cost-effective than those requiring an appearance. Note that the regulation does not specify any consequence for failure to comply; we suggest that judges use their inherent powers to correct noncompliant behavior.

Be Prepared To Bring The Judge Up To Speed:

Few judges have time to review their files prior to a lien conference or to become familiar with the issues that will be raised with respect to each lien. If the parties can narrow the scope of issues and get right to the point, the court will often be able to guide the parties towards a resolution.

Even fewer judges are knowledgeable about the Official Medical Fee Schedule (L.C. § 5307.1(a)(1) et seq., Reg. §§ 9789.10 et seq., § 9792.5), Medical-Legal Fee Schedule (L.C. § 4622, Reg. § 9795), Durable Medical Equipment, Prosthetics, Orthotics and Supplies (DMEPOS) fee schedule (L.C. § 5307.1(e)(4), Reg. § 9789.60), Interpreter Fee Schedule (L.C. § 5710(b)(5), Reg. §§ 9795.1), copy service fee schedule, home health care fee schedule, or the Medicare fee schedule ground rules upon which the OMFS is based. Where applicable, the defense and the lien representatives should have the relevant rules readily available at the lien conference.

It would help the process if WCJs who regularly hear lien issues (which includes most WCJs in Southern California) learn thoroughly the Medical-Legal Fee Schedule and the Interpreter Fee Schedule. They should know where and how to access the other fee schedules and the ground rules therefor. Unfortunately, with a system that is already overburdened, many WCJs simply do not have the time. A representative who is prepared and educated in the facts and the law of the lien at issue can often carry the day and resolve a lien before its set for trial simply by knowing what the issues are.

Brissman & Nemat is a law firm in Riverside CA representing lien claimants in advisory, regulatory, and collection matters.