Judgment Against State Insurance Fund Restored

SAN FRANCISCO (CN) - A California appeals court reinstated a $1.13 million judgment for Palm Medical Group, an occupational medical clinic that challenged the State Compensation Insurance Fund's process of admitting clinics into its preferred-provider network.

Palm Medical claimed the state fund violated the fair procedures doctrine by arbitrarily denying its application for admission into the network of preferred providers.

The appellate court overturned a ruling by Superior Court Judge Donald Mitchell, who reversed a jury's 2005 decision for Palm Medical and granted the fund's motion for judgment notwithstanding the verdict.

Jurors had determined that, because the fund wields so much influence on the treatment of work injuries in Fresno, its failure to admit an "ordinary, competent" medical provider "would significantly impair that provider's ability to practice occupational medicine in the Fresno area."

The appellate court saw no reason for granting the defendant's motion. But instead of ordering a new trial, it upheld the original verdict, finding that "the record includes ample evidence to support the jury's finding."

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