Defendants Roy C. Springer et al.
Knowing the United States Food and Drug Administration (FDA) had not approved use of a low-level laser procedure to remove cellulite, unwelcome lumpy fat deposits especially in the thigh and buttocks, California-licensed physician Dr. Springer opened the Laser Center clinic in Tijuana, Mexico, to perform such procedure. Dr. Springer solicited persons in San Diego to enroll in his Tijuana clinic for laser removal of cellulite. In soliciting plaintiffs, Dr. Springer made various misrepresentations involving past use of the laser procedure in Europe to remove cellulite and the anticipated FDA approval of such procedure for use in the United States. Relying on Dr. Springer's representations, plaintiffs underwent the laser procedure at his Tijuana clinic without significant removal of cellulite. Plaintiffs sued defendants on fraud and contractual theories. By special verdict the jury found for plaintiffs on all causes of action.
In 1988 Dr. Springer learned of a procedure using a low-level laser to remove cellulite. Aware that the FDA had not approved the laser procedure for use in the United States in removing cellulite, Dr. Springer contacted the FDA about the approval process. Because of the lack of FDA approval, Dr. Springer did not open a laser therapy clinic in San Diego.
In April 1989 the Springers formed a Mexican corporation, bought four lasers in the corporation's name and established the Laser Center clinic in Tijuana to perform the laser procedure on cellulite.
In 1989 and 1990 defendants falsely represented to plaintiffs that although the FDA had not yet approved the laser technique used by defendants, an application for approval was pending before the FDA with such approval expected within a few months. Defendants told plaintiffs the new low-level laser technique was the most effective and convenient method developed for removing cellulite. Defendants also represented that at the end of a specified period of treatment plaintiffs would have the legs, hips, or buttocks they wanted.
Relying on defendants' representations, plaintiffs enrolled at defendants' Tijuana clinic for removal of cellulite through the laser procedure. Beginning in September 1989, plaintiff Roosdahl underwent the laser procedure about 80 times over the course of 11 months and was charged at least $2,000. Roosdahl's cellulite condition did not disappear or improve. Beginning in February 1990, plaintiff Hartwigsen underwent the laser procedure about 40 times over the course of 7 months without improvement and was charged $2,000. Beginning in March 1990, plaintiff Vallbona underwent the laser procedure forty-seven times over the course of five or six months and was charged $2,000. Vallbona's cellulite condition remained the same.
SUPERIOR COURT PROCEEDINGS
In August 1991 plaintiffs filed this lawsuit seeking damages for intentional misrepresentation as to a past or existing material fact, negligent misrepresentation, and breach of contract. Plaintiffs alleged they spent considerable sums to undergo defendants' laser procedure based upon various misrepresentations. Plaintiffs also alleged defendants breached their oral contracts with plaintiffs by failing to remove plaintiffs' cellulite within the time promised and failing to provide plaintiffs with the promised leg, hip and buttock size reductions. Denying any liability, defendants asserted the laser procedure did not in any way damage plaintiffs.
After several discovery disputes, the matter came for jury trial in September 1992. Plaintiffs presented expert testimony that defendants distributed incorrect information. As a sanction for Dr. Springer's failing to respond and produce documents during discovery, the court excluded some proffered defense evidence and instructed the jury on various factual matters admitted by Dr. Springer.
By special verdict the jury made true findings against all defendants on all elements of plaintiffs' causes of action for intentional misrepresentation, negligent misrepresentation, and breach of contract. On the misrepresentation causes of action, the jury also found all defendants acted with oppression, fraud, or malice. The jury concluded defendants' conduct caused plaintiffs economic damages (Vallbona $6,295; Hartwigsen $11,800; and Roosdahl $8,730) and noneconomic damages (Vallbona $10,000; Hartwigsen $12,500; and Roosdahl $15,000).
Trial then proceeded to the punitive damages phase. Dr. Springer testified about defendants' assets. The jury assessed punitive damages of $125,000 against Dr. Springer; $75,000 against Mrs. Springer; and $25,000 against Laser Center.
In October 1992 the court entered judgment favoring plaintiffs on the jury's special verdict. Later the court denied defendants' motions for new trial or judgment notwithstanding the verdict.
Entitlement to Punitive Damages
Defendants attack the ruling denying their motion in limine involving punitive damages. Defendants contend plaintiffs' noncompliance with section 425.13's requirements barred any punitive damages award since plaintiffs' claims were assertedly directly related to professional services rendered by defendants. However, since this record indicates defendants waived the benefit of section 425.13, we conclude the trial court properly denied defendants' motion in limine to preclude plaintiffs from pursuing punitive damages.
In August 1991 without obtaining court permission under section 425.13, plaintiffs filed a complaint against defendants containing claims for punitive damages. Defendants did not demur or move to strike plaintiffs' punitive damages allegations. In October 1991 defendants answered the complaint without mentioning section 425.13 or otherwise challenging the pleading's
In Villa Pacific Building Co. v. Superior Court, supra, 233 Cal.App.3d 8, the appellate court held Civil Code section 1714.10's requirement of a court order as a condition precedent to suit against an attorney for civil conspiracy with the attorney's client was "not jurisdictional and that, absent timely objection to a complaint filed without permission of court, the protection conferred by section 1714.10 is waived." (233 Cal. App.3d at p. 9.)
Finding persuasive the analysis in Villa Pacific Building Co. v. Superior Court, supra, 233 Cal.App.3d 8, we conclude that section 425.13's requirement of a court order as a condition precedent to including a claim for punitive damages in an action arising out of the professional negligence of a health care provider is not jurisdictional, and absent timely objection to a complaint's inclusion of a punitive damages claim without court permission, the protection conferred by section 425.13 is waived. (233 Cal. App.3d at p. 12.) We find nothing in the language of section 425.13 — the pattern for Civil Code section 1714.10 — suggesting its benefit cannot be waived. (233 Cal. App.3d at p. 11.) Further, section 425.13, like Civil Code section 1714.10, is procedural, affecting only a remedy and not a substantive right. (233 Cal. App.3d at p. 11.) Hence, by answering plaintiff's complaint and litigating this case for almost a year before raising by motion in limine the issue of section 425.13, defendants waived any rights they might have had under the statute. (233 Cal. App.3d at p. 12.)
Amount of Punitive Damages Not Excessive
At the liability/compensatory damages phase of trial, the jury found Dr. Springer had been willfully false and had defrauded plaintiffs. At the punitive damages phase of trial, plaintiffs elicited Dr. Springer's testimony about defendants' assets and asserted liabilities. Dr. Springer claimed a net worth of "much less than" $100,000. At the punitive damages phase, the jury knew that Dr. Springer had been given notice to bring to trial all documentary evidence on the issue of net worth. In the jury's presence, Dr. Springer admitted he knew he would be asked to present evidence of his net worth and that his best interests dictated he bring to trial all documentary evidence demonstrating the existence of debts, liens or encumbrances assertedly reducing such net worth. However, in response to plaintiffs' discovery requests for all documents involving assets he owned, the only document Dr. Springer produced before trial was a handwritten loan application never submitted to any institution. Further, at the punitive damages phase, Dr. Springer failed to produce documents confirming the existence of most of his asserted liabilities. Instead, Dr. Springer presented only minimal evidence supporting defendants' claim that their outstanding liabilities minimized their net financial worth. Where, as here, a witness is knowingly false in one part of his testimony, the jury may distrust other portions of his testimony as well. (People v. Cook (1978) 22 Cal.3d 67, 86 [148 Cal.Rptr. 605, 583 P.2d 130].) Thus, the jury as fact finder was "permitted to credit some portions" of Dr. Springer's testimony "and not credit others." (People v. Williams (1992) 4 Cal.4th 354, 364 [14 Cal.Rptr.2d 441, 841 P.2d 961].) Moreover, the jury could properly view with distrust the weak evidence of liabilities presented by Dr. Springer since it was within his power to produce stronger and more satisfactory evidence. (Evid. Code, § 412.)
Dr. Springer testified the Springers' La Mesa condominium was worth $175,000 and produced $950 monthly rent. Dr. Springer testified there was little or no equity in the La Mesa condominium. According to Dr. Springer, the La Mesa condominium was subject to a $60,000 first trust deed with a $715 monthly payment; a $25,000 second trust deed; a $10,000 third trust deed; and the $70,000 trust deed also encumbering the El Cajon residence. At the outset of the punitive damages phase of trial, Dr. Springer for the first time produced a copy of the first trust deed on the La Mesa condominium. However, Dr. Springer did not present documentary evidence of the other asserted encumbrances on the La Mesa condominium.
Dr. Springer testified he was one of two remaining partners in a limited partnership owning an office building worth about $500,000. Dr. Springer testified there was little or no equity in the limited partnership. According to Dr. Springer, the partnership's office building was subject to a $300,000 trust deed. However, Dr. Springer did not present documentary evidence of such asserted trust deed.
Dr. Springer testified he owned a Mercedes worth $15,000 subject to a $6,000 loan; a new Toyota Previa worth $27,000 subject to a $24,000 loan; and a 1984 Nissan worth $2,000. However, Dr. Springer did not present documentary evidence of the asserted loans.
Dr. Springer produced documentary evidence indicating his medical practice was worth $150,000, although when testifying he asserted its value was less. Dr. Springer also testified he had a $3,000 bank account and a life insurance policy with a $4,000 residual value. Dr. Springer further testified Mrs. Springer owned jewelry worth $5,000.
In sum, Dr. Springer admitted the Springers jointly owned assets worth at least $1,126,000.
At oral argument defendants contended that — even accepting the $866,000 figure as the Springers' net worth — the $200,000 total punitive damages award against the Springers ($125,000 against Dr. Springer and $75,000 against Mrs. Springer) was excessive as a matter of law as representing about 25 percent of such net worth.
On this record we cannot conclude the $200,000 total punitive damages award against the Springers was excessive. Defendants' conduct in defrauding persons seeking professional medical treatment was reprehensible. (Devlin v. Kearny Mesa AMC/Jeep/Renault, Inc., supra, 155 Cal. App.3d at pp. 389-390.) Punitive damages of $200,000 were less than three times the $64,325 compensatory damages awarded. (Id. at p. 390.)
Finally, absent documentary evidence to the contrary, the jury could reasonably infer Laser Center owned laser equipment worth $77,000. Thus, in light of the relevant factors, the $25,000 punitive damages award against Laser Center was also not excessive as a matter of law. (Devlin v. Kearny Mesa AMC/Jeep/Renault, Inc., supra, 155 Cal. App.3d at pp. 388-392.)
Accordingly, we affirm the awards of punitive damages.
As a sanction for Dr. Springer's noncompliance with discovery, the court precluded defendants from introducing documentary evidence about Dr. Springer's purported effort to obtain FDA approval for use of his laser procedure to treat cellulite. The court also instructed the jury on various factual matters admitted by Dr. Springer. Defendants assert those rulings constituted prejudicial error. We disagree.
On January 13, 1992, plaintiffs served defendants with a request to produce various documents. Among the requested documents were those pertaining to the laser equipment defendants used on plaintiffs including any material indicating whether defendants applied to the FDA for approval of the laser procedure for cellulite.
On April 15, 1992, defendants' counsel responded informally, providing copies of some requested documents with a statement Dr. Springer did not presently have other requested materials. Defendants did not produce any documents pertaining to the laser equipment used by defendants on plaintiffs or application for FDA approval.
On August 3, 1992, upon plaintiffs' request, the court ordered the Springers' depositions be taken on August 20, 1992. The court indicated the Springers' failure to appear on that date might result in "terminating sanctions."
On August 24, 1992, the parties filed a joint disposition conference report. In that report defendants did not list any documents supporting their claims about the status of their purported pursuit of FDA approval of laser treatment for cellulite. The advance trial review conference orders indicated exhibits not listed on the joint disposition conference report were subject to exclusion at trial.
On September 2, 1992, the court ordered Dr. Springer to resume his deposition the next day and indicated that a referee would be appointed immediately to rule on evidentiary matters if Dr. Springer refused to answer.
On September 4, 1992, the court appointed a referee to mediate Dr. Springer's deposition.
On September 9 and 10, 1992, Dr. Springer testified at deposition. Dr. Springer testified that although at some time in the past he possessed documents pertaining to the laser equipment he did not search for such documents upon receiving the January 1992 request to produce. Dr. Springer also testified he had recently been unable to locate any such documents and believed they had been stolen on May 5, 1992. Dr. Springer further testified that neither before nor after plaintiffs' discovery request did he look for documents about application for FDA approval. According to Dr. Springer, at one time he had copies of written correspondence with the FDA and an independent review board in Northern California but believed those documents were among those stolen on May 5, 1992. Dr. Springer admitted he possessed requested documents about defendants' solicitations pertaining to the laser procedures performed on plaintiffs but had declined to produce them without "any particular reason."
On September 21, 1993, at the outset of trial, the court granted plaintiffs' motion in limine to exclude any mention of document theft. Based upon information discovered at Dr. Springer's deposition about his failure even to attempt to produce various requested documents, plaintiffs brought an in limine motion for evidence sanctions or terminating sanctions against defendants. (§ 2023.) The court reserved ruling on plaintiffs' motion until development of evidence on the issues raised.
On the first day of trial Dr. Springer testified that in January 1992 — after receiving plaintiffs' request to produce various documents including materials pertaining to any applications for government approval of defendants'
On the second day of trial, plaintiffs renewed their motion for discovery sanctions. Dr. Springer appeared in court with various documents he had not earlier produced. Dr. Springer asserted such documents were responsive to plaintiffs' earlier discovery requests and notice to produce at trial. Among those documents was correspondence with a federal employee in the Health and Human Services Department's radiation biology branch. The court told defense counsel it was "a total reprehensible violation of this court's rules, practices, and policies for a litigant to withhold documentation that is the subject of discovery and then surprisingly and unexplainedly find them during the trial." The court also stated: "That's not the way we try cases here, Dr. Springer, and your failure to comply or to establish any basis for refusing to comply with legitimate timely discovery requests subject you to sanctions. Your production of those documents at this stage of the game raises serious questions of propriety...."
Plaintiffs sought an issue sanction (§ 2023, subd. (b)(2)) ordering that it be taken as established in the lawsuit that Dr. Springer never applied to any organization in the United States for FDA approval of use of his laser procedure to treat cellulite. When the court asked defendants' counsel for documentary evidence of a pending application to the FDA for approval of the laser treatment, Dr. Springer asked if he could answer the question. After defense counsel indicated no objection to Dr. Springer conversing directly with the court, Dr. Springer addressed the court and was questioned by the judge. During that colloquy Dr. Springer admitted: before January 1990 there was no application with the FDA; between January and September 1990 Dr. Springer's application for approval through an independent review board at a San Diego hospital was pending; in September 1990 the hospital declined to permit Dr. Springer to do a laser study there; upon contacting an
After conversing with Dr. Springer, the court imposed an evidence sanction (§ 2023, subd. (b)(3)) for defendants' noncompliance with plaintiffs' earlier discovery request to produce documents pertaining to Dr. Springer's purported application for independent review board approval of the laser treatment for cellulite. Specifically, the court prohibited defendants from introducing any such documents into evidence. The court also imposed an issue sanction for defendants' misuse of the discovery process, directing plaintiffs' counsel to reduce to writing Dr. Springer's judicial admissions of various facts. The court later used the resulting document as a special jury instruction on Dr. Springer's factual admissions.
"The court may impose an evidence sanction by an order prohibiting any party engaging in the misuse of the discovery process from introducing designated matters in evidence." (§ 2023, subd. (b)(3).) Defendants' failure to respond to an authorized method of discovery constituted misuse of the discovery process. (§ 2023, subd. (a)(4).) As we shall explain, notwithstanding the language of section 2031, subdivision (k),
In Do It Urself Moving & Storage, Inc. v. Brown, Leifer, Slatkin & Berns, supra, 7 Cal.App.4th 27, the appellate court rejected contentions similar to defendants' that plaintiffs were required to obtain an order to compel compliance with discovery before seeking sanctions more drastic than monetary sanctions. (Id. at pp. 35-37.) The appellate court observed: "[W]hile the cases and treatises have interpreted the Civil Discovery Act of 1986 (§ 2016 et seq.), and the statutory scheme which preceded it, to require that, prior to the imposition of sanctions harsher than monetary sanctions, a party must have disobeyed a court order compelling discovery [citations], these authorities are distinguishable from the circumstances of the case at bench. Here, it is conceded that plaintiffs are unable to provide the promised items of discovery. Under the circumstances of this case, a warning to plaintiffs, in the form of a formal order to comply, would have been futile. [Citation.]" (Id. at pp. 35-36.) Requiring plaintiffs here to seek a formal order to compel defendants to comply with discovery would have been similarly futile since Dr. Springer had claimed the requested documents were stolen. Further, the evidence sanction actually imposed was not punitive but instead reflected the court's attempt to "tailor" the sanction to the harm caused by the withheld discovery. (Id. at p. 36.) Moreover, the question before us is not whether the superior court should have imposed a lesser sanction but rather "whether the trial court abused its discretion by imposing the sanction it chose. [Citation.]" (Id. at pp. 36-37.) Imposition of a lesser sanction here would have permitted defendants to benefit from their withholding of discovery by forcing plaintiffs "to proceed to trial without the benefit of the bargained-for evidence." (Id. at p. 37.)
In sum, the superior court acted within its discretion in imposing an evidence sanction tailored to defendants' particular discovery misuse by precluding them from introducing evidence pertaining to their purported effort to obtain approval for use of their laser procedure in the United States to remove cellulite. (Do It Urself Moving & Storage, Inc. v. Brown, Leifer, Slatkin & Berns, supra, 7 Cal. App.4th at p. 37; § 2023, subds. (a)(4) & (b)(3).)
In implementing an issue sanction imposed for defendants' misuse of the discovery process, the court instructed the jury: "There is no application
"The court may impose an issue sanction ordering that designated facts shall be taken as established in the action in accordance with the claim of the party adversely affected by the misuse of the discovery process." (§ 2023, subd. (b)(2).) As detailed above, the record amply supported a finding defendants misused the discovery process by willfully failing to respond to plaintiffs' authorized discovery request. (Do It Urself Moving & Storage, Inc. v. Brown, Leifer, Slatkin & Berns, supra, 7 Cal. App.4th at p. 36; § 2023, subd. (a)(4).)
The record indicates Dr. Springer initially testified that through independent review boards he indirectly applied for FDA approval of the laser procedure to remove cellulite; at one time he had documents pertaining to such purported application but chose not to produce them; and the application was later stolen so he no longer had a copy. However, on the next day of trial, Dr. Springer appeared in court with some of the purportedly stolen documents. After Dr. Springer then made various factual admissions, the
We reject defendants' contention the special instruction implementing the issue sanction improperly embodied judicial findings on disputed facts. The challenged instruction simply recited four facts admitted by Dr. Springer on the record directly to the court. Under those circumstances, the instruction was proper as stating facts no longer in dispute and upon which reasonable minds could not disagree. (Howard v. Global Marine, Inc. (1972) 28 Cal.App.3d 809, 813 [105 Cal.Rptr. 50].)
Finally, even if we deemed the challenged special jury instruction to be error, we would conclude defendants suffered no prejudice since on this record it is not reasonably likely an outcome more favorable to defendants would have resulted absent any such error. (Pool v. City of Oakland (1986) 42 Cal.3d 1051, 1069-1070 [232 Cal.Rptr. 528, 728 P.2d 1163]; LeMons v. Regents of University of California (1978) 21 Cal.3d 869, 876 [148 Cal.Rptr. 355,
Exclusion of Testimony of Defense Witnesses
At trial defendants sought to present three witnesses (Pont, Willis and Cardell) to testify they told defendants they were personally satisfied with defendants' laser treatment to reduce their cellulite. Defendants asserted those witnesses' statements to defendants were relevant to the issue of defendants' mental state for fraud as tending to show that defendants' representations about past successes with the laser procedure were made in good faith. The court granted plaintiffs' motion to preclude those three defense witnesses from testifying about their personal satisfaction with the results of the laser procedure performed by defendants. (Evid. Code, § 352.)
The court excluded Cardell's testimony since she underwent the laser procedure after plaintiffs and thus her satisfaction could not have influenced defendants' mental state when they made representations to plaintiffs. The court also declined to permit Willis and Pont to testify that their satisfaction justified defendants' representations of results. The court observed that — although beginning the laser treatment before plaintiffs — Willis and Pont had not received enough treatment to have influenced defendants' state of mind by the time of defendants' representations to plaintiff Roosdahl. The court also stated the statistical weight of the experience of Willis and Pont was slight since they were only two patients among the dozens treated before
The issue was whether defendants made various bad faith misrepresentations to plaintiffs involving FDA approval of use of the laser procedure to remove cellulite and the likelihood of successful results based in part on past experience in Europe. The issue was not whether the laser procedure worked to remove cellulite.
The judgment is affirmed.
Nares, J., and McDonald, J., concurred.
"`The amount of damages is a fact question, first committed to the discretion of the jury and next to the discretion of the trial judge on a motion for new trial. They see and hear the witnesses.... As a result, all presumptions are in favor of the decision of the trial court [citation]. The power of the appellate court differs materially from that of the trial court in passing on this question. An appellate court can interfere on the ground that the judgment is excessive only on the ground that the verdict is so large that, at first blush, it shocks the conscience and suggests passion, prejudice or corruption on the part of the jury.' [Citations.]" (Fagerquist v. Western Sun Aviation, Inc., supra, 191 Cal. App.3d at pp. 727-728.)
"The court may impose a terminating sanction by one of the following orders:
"(A) An order striking out the pleadings or parts of the pleadings of any party engaging in the misuse of the discovery process.
"(B) An order staying further proceedings by that party until an order for discovery is obeyed.
"(C) An order dismissing the action, or any part of the action, of that party.
"(D) An order rendering a judgment by default against that party."