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Personal Injury Damages Update: California High Court Denies Review of Pebley v. Santa Clara Organics, LLC

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Last month, we reported that a petition for review was filed seeking to overturn and depublish the decision by the Second Appellate District, Division 6, in Pebley v. Santa Clara Organics, LLC (2018) 22 Cal.App.5th 1266 (Pebley), which holds that an insured plaintiff who chooses to treat with medical providers outside his/her insurance plan “shall be considered uninsured, as opposed to insured, for the purpose of determining economic damages.” In other words, plaintiffs who seek medical treatment through liens instead of health insurance are not precluded from introducing evidence of those liens in support of their claim(s) for medical damages.

On August 8, 2018, the California Supreme Court denied the petition for review and depublication. Therefore, there remains a split in authority among the appellate districts on the issue. Until another appellate court publishes a decision explaining all the flaws in the Pebley court’s reasoning, defense counsel is left to argue that Pebley conflicts not only with the California Supreme Court’s rationale in Howell v. Hamilton Meats & Provisions, Inc. (2011) 52 Cal.4th 541, but also with other published Court of Appeal opinions, including Ochoa v. Dorado (2014) 228 Cal.App.4th 120 and State Farm Mutual Automobile Ins. Co. v. Huff (2013) 216 Cal.App.4th 1463, both of which hold that Howell applies even in the absence of pre-negotiated insurance rates. (For a more detailed chronology of Howell and its progeny, please see: Damages: Lien In: How One CA Appellate Decision May Change The Damages Game In Personal Injury Cases.")

Importantly, trial courts in California are not bound by the Pebley decision, even within the Second Appellate District, which encompasses Los Angeles, Ventura, Santa Barbara, and San Luis Obispo counties. However, superior courts generally follow appellate opinions emanating from their own districts, even if not bound to do so. In this circumstance, trial courts must decide which line of authority is better reasoned and follow that authority.

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