Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-3_14-cv-01866/USCOURTS-cand-3_14-cv-01866-5/pdf.json

Nature of Suit Code: 110
Nature of Suit: Insurance
Cause of Action: 28:1441 Petition for Removal- Breach of Contract

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United States District Court

Northern District of California

UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF CALIFORNIA

SAN FRANCISCO BAY AREA RAPID 

TRANSIT DISTRICT,

Plaintiff,

v.

GENERAL REINSURANCE 

CORPORATION,

Defendant.

Case No. 14-cv-01866-JSC 

OPINION RE: PHASE ONE BENCH 

TRIAL 

Re: Dkt. Nos. 35, 36

Defendant General Reinsurance Corporation (“General Reinsurance”) issued an excess 

insurance policy to Plaintiff San Francisco Bay Area Rapid Transit District (“BART”), which is a 

self-insured employer for workers’ compensation. This dispute arises out of a multiple myeloma 

workers’ compensation claim of a former BART employee, Michael Gonsolin (“Gonsolin”), 

which BART settled with Gonsolin before the Workers’ Compensation Appeals Board (“WC 

Appeals Board”). BART contends that General Reinsurance is obligated to pay the claim because, 

as stipulated by the parties before the WC Appeals Board, and found by the WC Appeals Board,

Gonsolin’s injury occurred during the policy period, and BART has reached its retention limit 

triggering General Reinsurance’s coverage. General Reinsurance contends that it has no 

obligation to pay because Gonsolin’s injury in fact occurred after its policy had ended. 

The parties agreed to resolve their dispute in a bench trial based upon stipulated facts. In 

Phase One the Court must decide whether the parties can litigate the date of injury; that is, whether 

for purposes of the application of the excess policy, General Reinsurance is bound by the decision 

of the WC Appeals Board. After carefully considering the parties’ submissions (Dkt. Nos. 35, 

36), and having had the benefit of oral argument on May 28, 2015, the Court finds that under the 

circumstances here General Reinsurance is not bound in this breach of contract action by the date 

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of injury that the WC Appeals Board found. 

BACKGROUND1

A. The Policy at Issue

BART is self-insured for workers’ compensation claim purposes. It nonetheless purchases 

excess insurance to cover claims that exceed a particular amount. General Reinsurance issued

BART an Excess Insurance Policy For Self-Insurer Of Workers’ Compensation and Employers 

Liability Policy (the “Policy”), effective July 1, 1985 through July 1, 1992. Under the Policy’s 

terms, BART had a $500,000 retention on workers’ compensation claims, meaning that BART 

was obligated to pay the first $500,000 and General Reinsurance was obligated to indemnify 

BART up to $10,000,000 in excess of that retention. (See Dkt. No. 34-1 at 1.)2 The Policy applies 

to “losses paid by” BART for “bodily injury by disease,” provided

the bodily injury or disease is caused or aggravated by the 

conditions of employment by the Insured. The employee’s last day 

of last exposure to those conditions of that employment causing or 

aggravating such bodily injury by disease must occur during the 

period this policy is in force. 

(Id. at 3.) When the Policy ended in 1992, BART obtained an excess insurance policy with a 

different insurer, but with the same retention amount. Beginning in 2002 and through the present,

BART’s excess insurance policies have had a much higher retention amount. (Dkt. 34-3.)

B. Gonsolin’s Workers’ Compensation Claim

Michael Gonsolin worked as a BART police officer from 1979 to 2005, except for 1985 to 

1987, when he worked as a detective. Gonsolin retired in 2005, and in October 2006 he was 

diagnosed with multiple myeloma. The following month Gonsolin filed an Application for 

Adjudication of Claim in WC Appeals Board Case No. SFO 0499837 (the “myeloma case”). 

Gonsolin claimed that he was entitled to workers’ compensation benefits due to his cumulative 

 

1

The following facts are taken from the parties’ Stipulated Facts (Dkt. No. 29), the Exhibits 

attached thereto (Dkt. No. 34), and the docket of this case.

2

Page numbers herein refer to those that the Court’s electronic case filing system automatically 

assigns.

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exposure to carcinogens, specifically benzene,3 while employed as a BART police officer. In his 

application, he listed the date of injury as “CT [cumulative trauma]” through October 13, 2006. 

(Dkt. No. 34-40 at 168.)

California’s workers’ compensation statutory scheme provides that “liability for 

occupational disease or cumulative injury” is limited to the employer who employed the claimant 

“during a period of four years immediately preceding either the date of injury, as determined 

pursuant to Section 5412, or the last date on which the employee was employed in an occupation 

exposing him or her to the hazards of the occupational disease or cumulative, injury, whichever 

occurs first.” Labor Code § 5505.5(a). Labor Code Section 5412, which governs the date of 

injury for occupational diseases or cumulative injury, defines date of injury as “that date upon 

which the employee first suffered disability therefrom and either knew, or in the exercise of 

reasonable diligence should have known, that such disability was caused by his present or prior 

employment.” Id. § 5412. “The fact of injury (exposure) and the date of injury (disability), by 

definition, are not equivalent in cases involving the latent effects of an occupational disease.” See 

Chevron U.S.A., Inc. v. WC Appeals Bd., 219 Cal. App. 3d 1265, 1271 (1990).

Special rules govern defining and proving injury when the occupational injury is cancer 

developed by peace officers exposed to carcinogens known to cause cancer. Labor Code § 3212.1. 

Under such circumstances, California law provides that “[t]he cancer so developing or manifesting 

itself in these cases shall be presumed to arise out of and in the course of employment.” Id.

§ 3212.1(d) (emphasis added). The presumption relates to the connection between the exposure 

and the disease, not to a particular date of injury. See Faust v. San Diego, No. SDO 244774, 68 

Cal. Comp. Cases 1822, 2003 WL 23148877, at *6-7 (W.C.A.B. Dec. 11, 2003) (en banc). The 

“presumption is disputable and may be controverted by evidence that the primary site of the 

cancer has been established and that the carcinogen to which the member has demonstrated 

exposure is not reasonably linked to the disabling cancer[,]” but “[u]nless so controverted, the 

 

3

 Benzene is “a component of products derived from coal and petroleum and is found in gasoline 

and other fuels.” Benzene, Occupational Safety & Health Admin., available at

https://www.osha.gov/SLTC/benzene/ (last visited June 24, 2015).

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[WC Appeals Board] is bound to find in accordance with the presumption.” Id. In Ennis v. BART, 

72 Cal. Comp. Cases 1694 (2007), the WC Appeals Board held that the Section 3212.1 cancer 

presumption applies to BART police officers.

On January 26, 2007, Athens Administrators, BART’s workers’ compensation claims 

administrator, denied Gonsolin’s claim, concluding that his “claim for cancer does not fall within 

the presumptions under Labor Code[ Sections] 3213.5 and 3212.6 . . . and there is no medical 

evidence to indicate that [his] cancer is related to [his] employment.” (Dkt. No. 34-39 at 17.) The 

matter then proceeded through the WC Appeals Board. On March 23, 2007, Gonsolin was 

deposed in connection with his myeloma case, and on April 19, 2007, Dr. Revels Cayton, a boardcertified internal medicine and pulmonary disease specialist chosen to be the Agreed Medical 

Examiner (“AME”) assigned to the case, issued a report regarding Gonsolin’s condition. Among 

other things, Dr. Cayton found that “Mr. Gonsolin’s multiple myeloma has reasonably been 

caused by his benzene exposure in the workplace.” (Dkt. No. 34-14 at 8.) Dr. Cayton was 

deposed on August 23, 2007 and testified that the average latency period for multiple myeloma is 

8 to 10 years. (Dkt. No. 34-15 at 4; see also Dkt. No. 34-37 at 15 (“[T]he average latency is 

probably eight to ten years. It can extend out, and it can be shorter, but eight to ten years would 

cover most bases.”).) Discovery in Gonsolin’s myeloma case closed on October 12, 2007.

Later that month, BART’s claims administrator reviewed a study from September and 

October 2007 that concluded, in relevant part, that there were no detectable levels of benzene 

present at any BART facilities and that “BART Police Sergeants are not exposed to Benzene in the 

course of their work.” (Dkt. No. 34-18 at 1.) BART thereafter filed a petition for removal to 

reopen discovery in the Gonsolin myeloma case to further depose Dr. Cayton about that study;

specifically, BART argued that Dr. Cayton’s analysis was “flawed” insofar as he had relied on 

inaccurate data about benzene levels in BART facilities to reach the conclusion that Gonsolin’s 

benzene exposure caused his myeloma. (See Dkt. No. 34-19 at 5.) BART further contended that 

Dr. Cayton was “cajoled” by Gonsolin’s attorney to find that Gonsolin had been exposed to 

“threshold levels” of benzene that caused his disease. (Id.) On November 19, 2007, the WC

Appeals Board judge rejected those arguments and issued a report recommending that the petition 

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be denied. (Dkt. No. 34-21 at 5.)

Also in November of 2007, the California Court of Appeal denied a petition for writ of 

review of the decision in Ennis v. BART, 72 Cal. Comp. Cases 1694 (2007), in which the WC

Appeals Board had held that the Labor Code Section 3212.1 cancer presumption applies to BART 

police officers. In the wake of that decision, BART’s attorney noted that it would have “a very 

difficult time prevailing on a question of” whether Gonsolin’s myeloma is a condition arising out 

of and occurring in the course of his employment. (Dkt. No. 34-22 at 2.)

BART thereafter sought to settle Gonsolin’s myeloma claim. The proposed settlement 

involved, among other things, obtaining Dr. Cayton’s opinion on the date of injury. On 

December 5, 2007, BART provided its excess insurer for injuries occurring in 2002 and later (not 

defendant General Insurance) a First Notice of Loss that represented the date of injury was 

October 13, 2006. (Dkt. No. 34-25.) The next day, Dr. Cayton issued a letter to BART and 

Gonsolin, regarding the date of injury, in which he states that “[t]he latency period for Mr. 

Gonsolin’s myeloma is fifteen years” . . . therefore “exposures prior to 1991 were injurious.” 

(Dkt. No. 34-26.)

On December 14, 2007, BART and Gonsolin reached an agreement and presented 

settlement terms to the WC Appeals Board, which thereafter entered a Partial Order Approving 

Compromise and Release with Open Medical Award and Partial Compromise and Release. The 

order was partial insofar as the WC Appeals Board reserved jurisdiction over an outstanding lien 

claim pertaining to certain medical expenses. (See Dkt. No. 34-27 at 3-4.) The agreement

resolved the dispute for $200,000 and stated in relevant part that the “[p]arties stipulate there is a 

dispute re[garding] date of injury, but based upon new medical information contained within Dr. 

Cayton’s [Agreed Medical Examiner] report of [December 6, 2007], [the] parties stipulate to a 

date of injury of . . . [November 1, 1990 to October 31, 1991], pursuant to [Labor Code 

§] 5500.5.” (Id. at 5.) Hearing minutes from the proceeding approving the settlement likewise 

reflect that “[t]he parties stipulate that there is a dispute regarding the date of injury[,] but based 

upon the recent medical information set forth by Dr. Cayton . . . the parties now stipulate to a date 

of injury described as cumulative trauma from November 1, 1990 through October 31, 1991 

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pursuant to Labor Code section 5500.5.” (Dkt. No. 34-28 at 3.)

C. BART/General Reinsurance Reimbursement History

One week after the settlement was approved, Athens claims supervisor Jan Ramacciotti 

sent a Notice of Claim via email to Genesis Underwriting Management Company (“Genesis”), the 

entity authorized to receive the claim on General Reinsurance’s behalf. This Notice of Claim was 

nearly identical to the one sent to the later excess insurer, but it listed October 31, 1991 as the date 

of injury instead of October 13, 2006. (Dkt. No. 34-29 at 2.) The Notice of Claim itself did not 

indicate that Gonsolin continued to work for BART through 2005. 

Genesis did not respond to the first notice or to Ramacciotti’s follow-up email of January 

2008, so Ramacciotti called Genesis and spoke with claim examiner Edith Coutinho on February 

25, 2008. In March and April of 2008, Ramacciotti and Coutinho spoke about the claim again. 

According to Ramacciotti’s notes, on March 17, 2008, Coutinho requested “just an update” and 

materials from Dr. Cayton, not the entire universe of medical and legal documents. (Dkt. No. 34-8 

at 2.) In response, on March 21, 2008, Ramacciotti provided case documents to Coutinho, 

including a status report from defense counsel that mentioned latency but did not state outright 

that Gonsolin continued to work for BART through 2005. (Dkt. No. 34-31.) Defense counsel’s 

summary represented that “the applicant, a police officer, sustained multiple myeloma/cancer as a 

result of his cumulative exposure to carcinogens through October 13, 2006.” (Id. at 1.) In 

addition to defense counsel’s report, Ramacciotti provided Dr. Cayton’s deposition, medical 

report, and his December 6 letter regarding date of injury; and the WC Appeal Board’s order 

approving the settlement. The attached report of Dr. Cayton states that Gonsolin “worked as a 

police officer for BART from 1979 until September 11, 2005.” (Dkt. No. 34-31 at 8.) Athens sent 

Genesis the award itself on April 4, 2008. (Dkt. No. 34-34.)

In September of 2008, Coutinho emailed Ramacciotti noting that she still had not received 

the documents requested in March 2008. In response, by the first week of October an Athens

claims examiner sent the full legal and medical file in Gonsolin’s case, which Genesis received by 

October 7, 2008. This file included Dr. Cayton’s deposition, which repeatedly mentions that 

Gonsolin worked for BART through 2005. (See, e.g., Dkt. No. 34-37 at 35; Dkt. No. 34-39 at 27; 

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Dkt. No. 34-40 at 141; Dkt. No. 34-41 at 23.) The file also included a letter from defense counsel 

from December 2007 indicating that Dr. Cayton had revised his opinions regarding the applicant’s 

date of injury, and that both he and the WC Appeals Board judge concluded that the date of injury 

was prior to 1991. (Dkt. No. 34-38 at 40-41.)

On October 7, 2008, Coutinho requested further information about Gonsolin’s current 

medical condition. Athens’ response email noted that the outstanding medical lien likely would 

exceed BART’s payment ceiling and, accordingly, would require General Reinsurance to pay out 

on the policy, and therefore resolution of the lien claims would require General Reinsurance’s

agreement. To that end, Athens sent Genesis a Settlement Authority Request, noting that 

Gonsolin’s medical bills to date were nearly $700,000, and noting that monies paid beyond 

$500,000 were subject to reimbursement from General Reinsurance as the excess carrier. On 

September 17, 2009, an Athens claims administrator wrote to Coutinho requesting reimbursement 

from General Reinsurance in the amount of $212,077.28, as Gonsolin’s total medical bills had 

reached $712,077.28. The following month, Athens received a reimbursement check for BART 

from General Reinsurance for $192,535.02. A year later, Athens requested further reimbursement 

of $73,021.75 for Gonsolin’s continued myeloma treatment, and on December 14, 2010 General 

Reinsurance reimbursed BART $64,422.97. In August of 2011 Athens submitted a third 

reimbursement request on BART’s behalf, this time seeking $130,000 for indemnity and 

$697,987.55 for medical claims, less the prior reimbursements. In November of 2011, General 

Reinsurance sent BART $70,112.11 in further reimbursement. In total, General Reinsurance

reimbursed BART for medical expenses in the amount of $327,070.10. 

It was not until January 27, 2012 that General Reinsurance notified BART and Athens that 

it had “no obligation under the Policy with respect to the Gonsolin Claim” and was therefore 

“entitled to reimbursement from BART of $327,070 previously paid on the claim.” (Dkt. No. 34-

51 at 1.) BART has continued to administer the Gonsolin claim, and since August of 2011 it has 

paid approximately $300,000 in excess of its $500,000 self-insured retention that General 

Reinsurance has not reimbursed.

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D. Procedural History

BART initiated this breach of contract action in Alameda County Superior Court on 

January 24, 2014. Thereafter General Reinsurance removed to matter to federal court, and the 

Court denied BART’s motion to remand. (Dkt. No. 16.) In March 2015, the Court agreed to the 

parties’ stipulation to try this matter in two phases. In Phase One, the Court will determine based 

on stipulated facts whether the “date of injury” is subject to litigation in this action or whether 

General Reinsurance is bound by the WC Appeals Board finding. If it is so bound, then General 

Reinsurance must indemnify BART. If BART prevails on the Phase One issue, then in Phase Two 

the Court will determine whether BART is entitled to attorneys’ fees. If, on the other hand, 

General Reinsurance prevails at Phase One, then at Phase Two the Court instead will determine 

whether the date of injury falls within General Reinsurance’s policy period. (See Dkt. No. 28-1.) 

The parties’ Phase One briefing is now before the Court. 

DISCUSSION

The Court must decide whether General Reinsurance is bound by the date of injury 

identified in the WC Appeals Board’s compensation award. General Reinsurance advances a host 

of reasons why the workers’ compensation judge did not make a correct factual determination 

about the date of injury, and even if she did, why the decision was wrong due to errors that BART 

and Gonsolin made regarding the law, misrepresentations they purportedly made to the workers’ 

compensation judge, and the judge’s improper adoption of a medical opinion that, in General 

Reinsurance’s view, lacked sufficient support in medical evidence. But these arguments all put 

the proverbial cart before the horse: at this stage of the litigation, the question is not whether the 

date of injury was wrong or why that might be the case; rather, the question is only whether 

General Reinsurance can seek to establish a different date of injury in this breach of contract 

action. BART argues that the Court has no jurisdiction to change the date of injury that the WC

Appeals Board determined, and even if it does, General Reinsurance is nonetheless barred from 

asserting a different date of injury now. 

A. The Court has Jurisdiction to Make a Factual Finding About the Date of Injury

There is no dispute that this federal court has diversity jurisdiction of this state law breach 

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of contract this action. BART instead argues that the Court lacks jurisdiction to find a different 

date of injury from that found by the WC Appeals Board for a variety of reasons. The Court 

disagrees.

1. In this Context, Date of Injury is Not Within the WC Appeal Board’s Exclusive 

Jurisdiction

Labor Code Section 5300 defines the “exclusive jurisdiction” of the WC Appeals Board, 

and provides in relevant part that all of the following proceedings “shall be instituted before the 

[WC Appeals Board] and not elsewhere”:

(a) For the recovery of compensation, or concerning any right or 

liability arising out of or incidental thereto.

(b) For the enforcement against the employer or an insurer of any 

liability for compensation imposed upon the employer by this 

division in favor of the injured employee[.]

. . . 

(e) For obtaining any order which by Division 4 the [WC Appeals 

Board] is authorized to make. 

(f) For the determination of any other matter, jurisdiction over which 

is vested by Division 4 in the Division of Workers’ Compensation[.]

Labor Code § 5300. Section 5300 is limited to claims involving compensation to the employee. 

In Millman v. Contra Costa Cnty., W.C.A.B. No. ADJ1527953, 2013 Cal. Wrk. Comp. P.D. 

LEXIS 615 (Appeals Bd. noteworthy panel decision), summarized at 79 Cal. Comp. Cases 439, 

2014 Cal. Wrk. Comp. LEXIS 32 (Dec. 13, 2013), a WC Appeals Board panel held that it does not 

have jurisdiction to resolve a contract dispute between a self-insured employer and its excess 

insurer. In other words, the panel held that Division Four of the Labor Code (the workers’ 

compensation statutory scheme, including Section 5300) is limited to disputes involving workers’

compensation claims, including claims against workers’ compensation policies. An excess 

insurance policy, however, is not a workers’ compensation policy and thus not subject to Division 

Four. Id.

4

This holding makes sense. Indeed, BART initiated its breach of contract action against 

 

4

The WC Appeals Board designated Millman a “significant panel decision.” Although such 

decisions are citable authority, they are not binding precedent, but are deemed persuasive by the 

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General Reinsurance in state court because it, too, does not believe that the exclusive jurisdiction 

of Labor Code Section 5300 applies to its contract action. 

The real question, then, is whether this Court has jurisdiction to make a finding in a 

contract action that is contrary to a finding made by the WC Appeals Board. While perhaps not 

optimal, and a situation to be avoided if possible, BART offers no authority that supports its 

assertion that this Court is without jurisdiction to do so. BART tries to reframe the question as 

whether the Court has jurisdiction to “alter” or “change” the finding of the WC Appeals Board. 

But this Court is not reviewing any decision of the WC Appeals Board, and any decision the Court 

makes will not affect the WC Appeals Board’s decision as to the compensation BART, as a selfinsured employer, owes its former employee. Put simply, regardless of this case’s outcome, 

BART will remain liable to Gonsolin as a self-insured employer even if it is determined that 

General Reinsurance is not the proper excess carrier because the date of injury fell outside of the 

Policy period.

It follows, then, that BART’s argument that 28 U.S.C. § 1257 deprives this Court of 

subject matter jurisdiction also fails. Section 1257 states that “federal review of state court 

judgments can be obtained only in the United States Supreme Court.” True. But this Court is not 

reviewing the WC Appeals Board order and is not and will not review the decision awarding the 

claimant benefits from BART. Instead, this case is limited to a breach of contract dispute between 

BART and General Reinsurance. The same fate applies to BART’s reliance on Labor Code 

Section 5302 as depriving this Court of jurisdiction to decide the date of injury for purposes of 

BART’s breach of contract claim. Section 5302 merely speaks to the finality of WC Appeals 

Board orders. Again, this action is not about the WC Appeals Board order, and this Court has no 

jurisdiction to review that order. This action is only about BART’s breach of contract action 

against General Reinsurance.

 

WC Appeals Board. See Guitron v. Santa Fe Extruders, WCAB No. ADJ163338, 76 Cal. Comp. 

Cases 228 n.7 (2011). The WC Appeals Board’s decisions, and summaries thereof, are authority 

“to the extent that they point out the contemporaneous interpretation and application of the 

workers’ compensation laws by the [WC Appeals Board].” Victor Valley Transit Auth. v. WC

Appeals Bd., 83 Cal. App. 3rd at 1075 n.9 (2000) (citation omitted).

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The Court similarly rejects BART’s assertion that pursuant to the Rooker Feldman

doctrine this Court lacks jurisdiction to decide the date of injury. Rooker-Feldman prohibits 

federal district courts “from exercising subject matter jurisdiction over a suit that is a de facto 

appeal from a state court judgment.” Kougasian v. TMSL, Inc., 359 F.3d 1126, 1139 (9th Cir. 

2004). The Rooker-Feldman doctrine bars subject matter jurisdiction in federal district court if “a 

federal plaintiff asserts as a legal wrong an allegedly erroneous decision by a state court, and seeks 

relief from a state court judgment based on that decision.” Noel v. Hall, 341 F.3d 1148, 1164 (9th 

Cir. 2003); see also ScripsAm., Inc. v. Ironridge Global LLC, 56 F. Supp. 3d 1121, 1137 (C.D. 

Cal. 2014) (“A losing party in state court is thus barred from seeking what in substance would be 

appellate review of a state judgment in federal district court[.]” (citation omitted)). Put another 

way, if “adjudication of the federal claims would undercut [a] state ruling, the federal [claim] must 

be dismissed for lack of subject matter jurisdiction.” Bianchi v. Rylaarsdam, 334 F.3d 895, 898 

(9th Cir. 2003). Rooker-Feldman also bars a defendant from asserting a substantive defense that 

attacks a state court judgment. See MacKay v. Pfeil, 827 F.2d 540, 544-45 (9th Cir. 1987). But 

this action does not attack the WC Appeals Board order; thus Rooker-Feldman does not apply. 

Moreover, Rooker-Feldman cannot be applied against anyone who was not a party to the 

state court action, see So. Cal. Edison Co. v. Lynch, 307 F.3d 794, 805 (9th Cir. 2002) (“The 

Rooker-Feldman doctrine does not bar the exercise of federal court jurisdiction when the federal 

court litigant was not a party to the state court action.”) (citation omitted), even if the party against 

whom the doctrine is asserted is in privity to a party to the earlier action, see Lance v. Dennis, 546 

U.S. 459, 466 (2006); see also Bennett v. Yoshina, 140 F.3d 1218, 1224 (9th Cir. 1998) (“[M]ere 

participation in the state case . . . does not invoke the Rooker/Feldman bar.”). Thus, because 

General Reinsurance was not a party to the WC Appeals Board proceedings, Rooker-Feldman

does not bar these claims. What is more, the doctrine does not apply to suits seeking review of 

state agency action. See Exxon Mobil Corp. v. Saudi Basic Indus. Corp., 544 U.S. 280, 287 

(2005) (citing Verizon Md. Inc. v. Pub. Serv. Comm’n of Md., 535 U.S. 635, 544 n.3 (2002)). 

Thus, even though the WC Appeals Board decision was final, it was a final agency decision and 

therefore the Rooker-Feldman bar does not apply for this additional reason.

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The conclusion that this action will not affect BART’s obligations to Gonsolin is consistent 

with those cases holding that the courts, as opposed to the WC Appeals Board, have exclusive 

jurisdiction over contract and tort actions for damages that relate to an underlying workers’ 

compensation action. See La Jolla Beach & Tennis Club, Inc. v. Indus. Indem. Co., 9 Cal. 4th 27, 

35 (1994); see also Scott v. Indus. Acc. Comm., 46 Cal. 2d 76, 82-83 (1956) (“[T]he superior court 

cannot award workmen’s compensation benefits, and the [WC Appeals Board] cannot award 

damages for injuries.”); U.S. Fidelity & Guar. Co. v. Lee Investments LLC, 641 F.3d 1126, 1135

(9th Cir. 2011) (WC Appeals Board lacks jurisdiction over actions by a workers’ compensation

insurer against the insured-employer for rescission and reimbursement of policy proceeds); Victor 

Valley Transit Auth. v. WC Appeals Bd., 83 Cal. App. 4th 1068, 1070 (2000) (superior court, not 

WC Appeals Board, has jurisdiction over contribution action by one city against another for 

reimbursement payment of works’ compensation benefits); Salimi v. State Comp. Ins. Fund, 54 

Cal. App. 4th 216, 218 (1997) (holding that the superior court has jurisdiction over employer’s 

suit against workers’ compensation insurer for breach of contract for failure to defend a workers’ 

compensation claim).

BART’s reliance on General Reinsurance Corp. v. WC Appeals Board (“St. Jude Joinder 

Case”), No. A092380, 65 Cal. Comp. Cases 1441 (2000), is misplaced. After the employer, St. 

Jude, and the claimant had reached a settlement, the claimant sought to obtain penalties from St. 

Jude for late payments. The penalties were likely to exhaust St. Jude’s retention with its excess 

insurer, General Reinsurance; accordingly, St. Jude sought successfully to join General 

Reinsurance to the workers’ compensation proceeding. In denying General Reinsurance’s writ 

petition, the California Court of Appeal held that an excess insurer may be joined to a workers’ 

compensation proceeding pursuant to Labor Code Section 3753, which permits an injured worker 

to join “any insurer,” and Section 5307.5(b), which authorizes the joinder of “all persons 

interested in the proceeding.” Id. at 1444. Thus, St. Jude stands for the proposition that an excess 

insurer may be a party to a workers’ compensation proceeding; it does not in any way support 

BART’s argument that when neither the employee nor the employer joins the excess insurer, a 

civil court is without jurisdiction to adjudicate any facts that were adjudicated in the workers’

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compensation proceeding. 

* * *

Accordingly, the Court is not stripped of its jurisdiction to make a factual determination 

regarding the date of injury to resolve the parties’ coverage dispute. Because this action it pertains 

exclusively to whether General Reinsurance is obligated to indemnify BART and has no effect on 

Gonsolin’s statutory right to workers’ compensation for myeloma that the WC Appeals Board

determined arose out of his employment, the Court has jurisdiction to decide the date of injury for 

purposes of General Insurance’s contractual obligations.

B. General Reinsurance May Litigate a Change in Date of Injury

BART next contends that, even if the Court has jurisdiction to determine the date of injury, 

General Reinsurance is nonetheless barred from litigating it on the grounds of (1) issue preclusion,

(2) equitable estoppel, (3) waiver, and (4) laches. Unfortunately for BART, none of these 

arguments succeeds. 

1. Issue Preclusion Does Not Apply

BART’s issue preclusion argument hinges on workers’ compensation statutory sections 

pertaining to administrative and judicial review of matters within the WC Appeal Board’s 

exclusive jurisdiction. Specifically, Labor Code Section 5804 provides that “[n]o award of 

compensation shall be rescinded, altered, or amended after five years from the date of the injury 

except upon a petition by a party in interest filed within such five years and any counterpetition 

seeking other relief filed by the adverse party within 30 days of the original petition raising issues 

in addition to those raised by such original petition.” BART contends that General Reinsurance, 

as a “party in interest,” “could have submitted a petition for relief under Section 5804, and having 

failed to do so, is bound to the WC Appeal Board’s date of injury determination due to claim 

preclusion.

As a preliminary matter, General Reinsurance is not seeking in this action (which, in any 

event, was filed by BART) to rescind, alter, or amend the award of compensation to Gonsolin. 

Thus, Section 5804 simply does not apply. Apart from Section 5804, however, the Court 

interprets BART’s argument as being that because the “date of injury” was actually litigated in the 

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workers’ compensation proceedings, and General Reinsurance could have participated in those 

proceedings, its defense in this action is barred by issue preclusion. Not so.

“Collateral estoppel, or issue preclusion, precludes relitigation of issues argued and 

decided in prior proceedings.” Myocogen Corp. v. Monsanto Co., 28 Cal. 4th 888, 896 (2002) 

(internal quotation marks and citation omitted). “The doctrine applies only if the decision in the 

initial proceeding was final and on the merits and the issue sought to be precluded from 

relitigation is identical to that decided in the first action and was actually and necessarily litigated 

in that action.” Lucido v. Super. Ct., 51 Cal. 3d 335, 341 (1990). In addition, the party against 

whom preclusion is sought must be the same as, or in privity with, the party to the first action. Id. 

In other words, even where the second cause of action is not barred by claim preclusion, judgment 

in an earlier case can “operate[ ] as an estoppel or conclusive adjudication as to such issues in the 

second action as were actually litigated and determined in the first action” between the same 

parties. Branson, 24 Cal. App. 4th at 345 (citation omitted); see also Johnson v. City of Loma 

Linda, 24 Cal. 4th 61, 78 (2000) (listing the elements of collateral estoppel as “identity of issues, 

finality of the decision, and identity or privity of the party against whom estoppel is sought”); 

Segal v. AT&T Co., 606 F.2d 842, 845 (9th Cir. 1979). 

Issue preclusion may operate as a bar to litigation of an issue that was decided in an earlier 

administrative proceeding “if the agency, acting in a judicial capacity, resolved disputed issues of 

fact properly before it, in a proceeding in which the parties had an adequate opportunity to litigate 

the factual issues” and “where the time for seeking judicial review of the administrative decision 

through a petition for writ of mandate had expired without such review being sought.” Johnson, 

24 Cal. 4th at 78 (citing People v. Sims, 32 Cal. 3d 468, 484-86 (1982)).

Issue preclusion does not apply here because General Reinsurance was not in privity with 

BART in the workers’ compensation proceedings. To determine privity, “courts examine the 

practicalities of the situation and attempt to determine whether [the parties] are sufficiently close 

. . . to afford application of the principles of preclusion.” Armstrong v. Armstrong, 15 Cal. 3d 942, 

951 (1976) (internal quotation marks and citation omitted). Privity may be established by “a 

mutual or successive relationship to the same rights of property, or to such an identification in 

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interest of one person with another as to represent the same legal rights.” Citizens for Open 

Access to Sand & Tide, Inc. v. Seadrift Ass’n, 60 Cal. App. 4th 1053, 1069 (1998) (internal 

citations omitted). Privity “has also been expanded to refer to . . . a relationship between the party 

to be estopped and the unsuccessful party in the prior litigation which is ‘sufficiently close’ so as 

to justify application” or preclusion. Id. at 1069-60. Privity will be found where the two parties 

have a “sufficient commonality of interests.” Tahoe-Sierra Preservation Council, Inc. v. Tahoe 

Regional Planning Agency, 322 F.3d 1064, 1081 (9th Cir. 2003) (citations omitted).

Here, the WC Appeals Board proceedings involved Gonsolin versus BART, while the 

instant action involves BART versus General Reinsurance. Plainly, General Reinsurance was not 

a party to the earlier proceedings. Nor does General Reinsurance have a sufficient commonality of 

interest with BART to find the two parties in privity. Indeed, instead of having an “identification 

in interest . . . [so] as to represent the same legal rights[,]” Seadrift Ass’n, 60 Cal. App. 4th at 

1069, BART and General Reinsurance had competing interests in the prior proceedings: it was in 

BART’s interest to settle the compensation claim with Gonsolin and trigger whatever excess 

policy had the lowest retention so that BART would pay as little as possible out of its own 

pockets; in contrast, it was in General Reinsurance’s interest to avoid indemnity altogether, 

regardless of whether the WC Appeals Board found Gonsolin’s claims compensable. 

California courts have reached similar conclusions when it comes to co-insurers’ interests 

in underlying WC Appeals Board proceedings. For example, in Chartis Insurance v. WC Appeals 

Board, 75 Cal. Comp. Cases 891 (2010), a California Court of Appeal determined that an insurer 

and insured’s stipulated date of injury is not binding on a later contribution action between the two 

insurers, nor does claim preclusion bar the newly added insurer from litigating the date of injury in 

the later contribution action. The court emphasized that an earlier date of injury is not binding on 

later contribution proceedings in part because the nonelected defendants’ rights—i.e., those 

insurance carriers not named in the initial workers’ compensation action—“are not fully 

represented in the original proceeding.” Id. at 893. Likewise, even in successive proceedings all 

before the WC Appeals Board, courts have held that liability findings premised on the WCJ’s 

findings of fact based on stipulations between the claimant and insured employer are not binding 

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on subsequent contribution proceedings between insurers for the simple reason that the other 

insurers who were not named as defendants in the earlier proceedings were not fully represented in 

the WC Appeals Board proceedings. See, e.g., id. at 894; Fremont Comp. Ins. Grp. v. WC Appeals 

Bd., 64 Cal. Comp Cases 1400, 1999 Cal. Wrk. Comp. LEXIS 5701, *3-4 (1999) (workers’ 

compensation insurers are free to relitigate date of injury determinations in contribution and 

insurance coverage arbitrations); Rex Club v. WC Appeals Bd., 53 Cal. App. 4th 1465, 1472 

(1997) (insurers are free to relitigate liability in contribution proceedings). 

In its argument for issue preclusion, BART ignores the well-established requirements for 

privity—i.e., a sufficient commonality of interest— and instead insists that issue preclusion will 

apply when three factors (protection against vexatious litigants; furtherance of finality where 

public interests are involved; and promotion of stability of adjudications of prior actions) favor its 

application. (Dkt. No. 35 at 26 (citing Lynch v. Glass, 44 Cal. App. 3d 943, 947-48 (1975)).) But 

the Lynch court listed those factors as examples where issue preclusion had applied, and still noted 

that privity, at bottom, comes down to “whether a nonparty was ‘sufficiently close’ to an 

unsuccessful party in a prior action as to justify the application of collateral estoppel against the 

nonparty.” 44 Cal. App. 3d at 948 (citations omitted). BART and General Reinsurance have no 

such sufficiently close relationship; if anything, their positions in the WC Appeals Board 

proceedings were antagonistic. Accordingly, issue preclusion does not bar General Reinsurance 

from litigating the date of injury.

BART’s arguments to the contrary are unpersuasive. First, its argument is premised on its 

misplaced insistence that General Reinsurance was subject to mandatory administrative exhaustion 

of the WC Appeal Board’s decision under Section 5804. But the Court already rejected this 

argument. Moreover, the cases on which BART relies miss the mark. Ford v. Providence 

Washington Insurance Co., 151 Cal. App. 2d 431 (1957), merely holds that “an insurer who has 

had an opportunity to defend is bound by the judgment against its insured as to all issues which 

were litigated in the action against the insured.” Id. at 436. But General Reinsurance, as BART’s 

excess insurer, had no obligation to defend BART against Gonsolin’s claim. Ford is simply 

inapplicable. Clemmer v. Hartford Insurance Company, 22 Cal. 3d 865, 872, 886 (1978), is

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inapplicable for the same reason. It, too, involves an insurer who had the opportunity to defend its 

insured but chose not to do so. Id. at 886. Notably, in both cases each insurer was in privity with 

its insured: each had the exact same interest in defending the claim against the insured. Here, such 

privity is plaining lacking. As General Reinsurance was not in privity with BART, claim 

preclusion does not bar litigation of the date of injury in the context of this breach of contract suit.

2. General Reinsurance is not Equitably Estopped from Litigating the Date of Injury

BART next asserts that General Reinsurance should be equitably estopped from litigating 

the date of injury. The doctrine of equitable estoppel, also known as promissory estoppel, “is 

founded on concepts of equity and fair dealing. It provides that a person may not deny the 

existence of a state of facts if he intentionally led another to believe a particular circumstance to be 

true and to rely upon such belief to his detriment.” City of Goleta v. Super. Ct., 40 Cal. 4th 270, 

279 (2006) (internal quotation marks and citation omitted). The elements of equitable estoppel 

are: “(1) the party to be estopped must be apprised of the facts; (2) he must intend that his conduct 

shall be acted upon, or must so act that the party asserting the estoppel has a right to believe it was 

so intended; (3) the other party must be ignorant of the true state of facts; and (4) he must rely 

upon the conduct to his injury.” People v. Castillo, 49 Cal. 4th 145, 155 n.10 (2010) (citations 

omitted). “One aspect of equitable estoppel[,]” and the particular brand that BART advances, “is 

codified in Evidence Code section 623, which provides that whenever a party has, by his own 

statement or conduct, intentionally and deliberately led another to believe a particular thing true 

and to act upon such belief, he is not, in any litigation arising out of such statement or conduct, 

permitted to contradict it.” Superior Dispatch, Inc. v. Ins. Corp. of N.Y., 181 Cal. App. 4th 175, 

186-87 (alterations and citations omitted); see also Strong v. Cnty. of Santa Cruz, 15 Cal. 3d 720, 

725 (1975) (noting that the doctrine of equitable estoppel “provides that a person may not deny the 

existence of a state of facts if he intentionally led another to believe a particular circumstance to be 

true and to rely upon such a belief to his detriment”). The existence of estoppel is a question of 

fact, Gen. Motors Acceptance Corp. v. Gilbert, 196 Cal. App. 2d 732, 742 (1961), and the party 

asserting estoppel bears the burden of proving it, see Domarad v. Fisher & Burke, Inc., 270 Cal. 

App. 2d 543, 556 (1969).

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In insurance disputes, “the doctrines of implied waiver and of estoppel, based upon the 

conduct or action of the insurer, are not available to bring within the coverage of a policy risks not 

covered by its terms, or risks expressly excluded therefrom.” Supervalu, Inc. v. Wexford 

Undewriting Mgrs., Inc., 175 Cal. App. 4th 64, 77 (2009). Thus, to the extent that the date of 

injury falls outside General Reinsurance’s excess coverage policy, BART cannot use equitable 

estoppel to find that it does. For this reason, alone, estoppel does not apply.

Even if such affirmative equitable estoppel usage was permitted, BART cannot not avail 

itself of the doctrine here. The first element of equitable estoppel requires that the party to be 

estopped is apprised of the facts—i.e., has knowledge of the facts. Castillo, 49 Cal. 4th at 155 

n.10. Conversely, there can be no equitable estoppel where the party asserting equitable estoppel 

misrepresents the true facts, such that the party to be estopped was not apprised of the true facts. 

See, e.g., Stokes v. Bd. of Permit Appeals, 52 Cal. App. 4th 1348, 1357 (1997) (rejecting plaintiff’s 

argument that defendant should be estopped from revoking building permits where the plaintiff 

misrepresented true facts about the use of the property). However, “negligence satisfies the 

element of knowledge.” Green v. MacAdam, 175 Cal. App. 2d 481, 487 (1959) (citation omitted). 

This is the element to which the parties devote the most significant attention, disputing 

whether General Reinsurance possessed sufficient information about Gonsolin’s employment and 

Dr. Cayton’s medical opinion to understand that the October 1991 date of injury was stipulated to 

based on Gonsolin’s employment with BART through 2005 and Dr. Cayton’s 15-year latency 

determination. By March of 2008 General Reinsurance had received documents that clearly 

indicated that Gonsolin worked at BART through 2005. (See, e.g., Dkt. No. 34-31 at 1 (noting 

that Gonsolin “sustained multiple myeloma/cancer as a result of his cumulative exposure to 

carcinogens through October 13, 2006”); id. at 8 (“Mr. Gonsolin has worked as a police officer for 

BART from 1979 until September 11, 2005.”).) Likewise, the documents received in March also 

reflect the parties’ stipulation and the WC Appeal Board’s acceptance of the parties’ agreement 

that Gonsolin’s myeloma had a 15-year latency period. (Dkt. No. 34-31 at 2 (quoting the WC

Appeal Board’s decision as noting that “[h]aving considered the reports of Dr. Cayton, I find that 

the latency period for Mr. Gonsolin’s myeloma is 15 years. Therefore, looking back from the date 

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of diagnosis in 2006, I am persuaded that Dr. Cayton is correct in setting forth the exposures prior 

to 1991 as being injurious causing the injury herein.”).) By October of 2008, General Reinsurance

received even more documents that reflected Gonsolin’s 2005 retirement, his 2006 date of 

diagnosis, and the 15-year latency period stipulation. (See, e.g., Dkt. No. 34-37 at 41.)5 General 

Reinsurance had also received Dr. Cayton’s deposition testimony, which reflected his earlier 

statement that the average latency period for myeloma was between 8 and 12 years. (See Dkt. No. 

34-37 at 15.) The Court thus finds that the first estoppel element is satisfied. That General 

Reinsurance perhaps did not fully assess the documents before it does not preclude equitable 

estoppel, but rather suggests that General Reinsurance was negligent in reviewing the information 

before it. See Green, 175 Cal. App. 2d at 487.

The second element is that the party to be estopped had an intent that his conduct would be 

acted upon. Carillo, 49 Cal. 4th at 155 n.10. “The defendant need not intend to deceive the 

plaintiff to give rise to an equitable estoppel.” Superior Dispatch, Inc., 181 Cal. App. 3d at 1295 

(citation omitted); see also Domarad, 270 Cal. App. 2d at 555 (“Negligence that is careless and 

culpable conduct is, as a matter of law, equivalent to an intent to deceive and will satisfy the 

element of fraud necessary to an estoppel.” (internal quotation marks and citations omitted)). 

Rather, “[t]o create an equitable estoppel, it is enough if the party has been induced to refrain from 

using such means or taking such action as lay in his power, by which he might have retrieved his 

position and saved himself from loss.” Id. (internal quotation marks and citation omitted). Here, 

when General Reinsurance actually reimbursed BART three times for the compensation BART 

paid Gonsolin above and beyond BART’s retention, General Reinsurance induced BART to 

believe that General Reinsurance would not be challenging the date of injury determination and its 

coverage. BART relied on General Reinsurance not challenging the date of injury and its 

coverage by not pursuing another excess coverage insurer. Thus, the Court finds that the element 

of intent is satisfied.

 

5

For a comprehensive list of the fifteen different documents that General Reinsurance possessed 

by October 2008 referring to the 2006 date of injury and 2005 date of retirement, see Docket No. 

40 at 14.

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The third element of estoppel is that the party asserting estoppel is ignorant of the true 

facts. Carillo, 49 Cal. 4th at 155 n.10. This element requires that the party asserting equitable 

estoppel not only lacked actual knowledge of the true facts, but also did not have notice of the 

facts sufficient to put a reasonably prudent person on inquiry notice. Life v. Cnty. of Los Angeles, 

227 Cal. App. 3d 894, 902 (1991). Here, this would mean that BART was ignorant of facts that 

give rise to the possibility that General Reinsurance might challenge the date of injury or deny 

coverage. This is where BART’s equitable estoppel argument fails. The Court finds that BART 

had knowledge that there was a dispute over the date of injury; indeed, the WC Appeal Board’s 

order approving the settlement even stated as much. (See Dkt. No. 34-27 at 5.) Moreover, prior to 

giving notice of the settlement to General Reinsurance, BART gave notice to a different excess 

insurer, Midwest, suggesting that Midwest would cover the excess compensation payments based 

on a later date of injury. (See Dkt. No. 34-25.)

Nor can BART show that it has been harmed by General Reinsurance’s conduct. BART 

can still report the claim to another excess coverage insurer, as late notice of a claim is not a 

defense to coverage absent prejudice. See Safeco Ins. Co. of Am. v. Parks, 170 Cal. App. 4th 992, 

1004 (2009). Thus, BART has not established that equitable estoppel bars General Reinsurance

from litigating the date of injury now.

3. General Reinsurance Did Not Waive Challenge to the Date of Injury

Next, BART contends that General Reinsurance waived its right to litigate the date of 

injury issue because it failed to challenge the issue before the WC Appeals Board. Under 

California law, waiver is “the intentional relinquishment or abandonment of a known right.” 

Bickel v. City of Piedmont, 16 Cal. 4th 1040, 1048 (1997) (citations omitted), abrogated on other 

grounds by DeBerard Props, Ltd. v. Lim, 20 Cal. 4th 659, 668 (1999). Waiver is a question of 

fact, Bickel, 16 Cal. 4th at 1052, and always is based upon the parties’ intent, Waller v. Truck Ins. 

Exch., Inc., 11 Cal. 4th 1, 31 (1995). The party claiming waiver must “prove it by clear and 

convincing evidence that does not leave the matter to speculation, and doubtful cases will be 

decided against a waiver.” Waller, 11 Cal. 4th at 31 (internal quotation marks and citations 

omitted). “The waiver may either be express, based on the words of the waiving party, or implied, 

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based on conduct indicating an intent to relinquish the right.” Id. (citation omitted). In the 

insurance context in particular, California courts have applied a particularly high bar for 

demonstrating waiver, noting that denial of coverage on one ground does not impliedly waive 

denial on the basis of grounds not stated in the denial. See id. (citations omitted); see also State 

Farm Fire & Cas. Co. v. Jioras, 24 Cal. App. 4th 1619, 1628 n.7 (1994). Further, just as with 

equitable estoppel, a party cannot use implied waiver to establish coverage where none exists. 

Supervalu, Inc., 175 Cal. App. 4th at 77. For this reason alone BART’s implied waiver argument 

fails.

Even if implied waiver were available, it does not apply. BART argues implied waiver

based upon General Reinsurance’s failure to seek to rescind, alter or amend the WC Appeals 

Board’s award of compensation or to file a petition for relief to the WC Appeals Board pursuant to 

Labor Code Section 5804, and its failure to seek contribution pursuant to Labor Code Section 

5500.5. The Court cannot infer General Reinsurance’s intent to waive a challenge to the date of 

injury determination from its failure to engage in an administrative challenge to the WC Appeal 

Board’s compensation award as it has already determined that General Reinsurance was not 

obligated to do so.

Thus, BART has failed to establish by clear and convincing evidence that BART intended 

to relinquish its right to challenge the date of injury determination and contest coverage.

4. Laches Does Not Bar General Reinsurance From Litigating the Date of Injury

Finally, laches does not bar General Reinsurance from litigating the date of injury. Laches 

is an equitable defense that bars a claim when there is “unreasonable delay plus either 

acquiescence in the act about which plaintiff complains or prejudice to the defendant resulting 

from the delay.” Johnson v. City of Loma Linda, 24 Cal. 4th 61, 77 (2000). Laches is “designed 

to promote justice by preventing surprises through the revival of claims that have been allowed to 

slumber until evidence has been lost, memories have faded, and witnesses have disappeared[.]” 

Brown v. State Pers. Bd., 166 Cal. App. 3d 1151, 1161 (1985). Any delay is measured from the 

time the plaintiff knew or should have known about the alleged claim. Magic Kitchen LLC v. 

Good Things Int’l Ltd., 153 Cal. App. 4th 1144, 1157 (2007). “Prejudice is never presumed; 

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rather it must be affirmatively demonstrated by the defendant in order to sustain his burdens of 

proof and the production of evidence on the issue.” Miller v. Eisenhower Med. Ctr., 27 Cal. 3d 

614, 624 (1980). The prejudice may be factual in nature or compromise the presentation of the 

defense.” Drake v. Pinkham, 217 Cal. App. 4th 400, 406 (2013) (citation omitted). Put another 

way, “[c]ourts have recognized two chief forms of prejudice in the laches context—evidentiary 

and expectations-based.” Danjaq LLC v. Sony Corp., 263 F.3d 942, 955 (9th Cir. 2001) (citation 

omitted). Evidentiary prejudice “includes such things as lost, stale, or degraded evidence, or 

witnesses whose memories have faded or who have died.” Id. Expectations-based prejudice 

occurs when a party “show[s] that it took actions or suffered consequences that it would not have, 

had the plaintiff brought suit properly.” Id. (citation omitted).

Normally, laches applies to bar a particular cause of action from moving forward, not to 

bar a particular defense. See Miller, 27 Cal.3d at 624 (noting that the “affirmative defense of 

laches requires unreasonable delay in bringing suit” (emphasis added)). But here, BART contends 

that laches bars General Reinsurance from asserting in this breach of contract action that BART 

brought a date of injury different from the WC Appeal Board’s date of injury determination. The 

Court finds that laches does not apply to this situation. Laches here is just another way of arguing 

equitable estoppel, an issue the Court has already rejected. 

* * *

BART has failed to establish that any legal doctrine bars General Reinsurance from 

litigating the date of injury in the context of this breach of contract dispute. General Reinsurance

was not obligated to seek to change the date of injury determined in the WC Appeals Board

proceedings, and its failure to do so does not preclude it from litigating that issue now. To be 

sure, a date of injury determination in this action may be inconsistent with the stipulated date of 

injury accepted in the WC Appeals Board proceedings, but an inconsistent determination will not 

disturb Gonsolin’s statutorily-owed compensation. Moreover, the Court’s finding does not mean 

an excess insurer will never be bound by findings of fact made in workers’ compensation 

proceedings. An employer may seek to join its excess insurer to a workers’ compensation 

proceeding. See Millman, 79 Cal. Comp. Cases at 439; St. Jude Joinder Case, 65 Cal. Comp. 

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Cases at 1444. If it successfully does so, the excess insurer may be prohibited by issue preclusion

from litigating in a subsequent coverage dispute with its insured issues decided in the workers’ 

compensation action. But General Reinsurance was not joined, or even sought to be joined, to the 

workers’ compensation proceedings here. Thus, it is not bound by the WC Appeals Board finding 

of date of injury.

CONCLUSION

For the reasons described above, the Court concludes that it has jurisdiction to make a 

factual determination regarding the date of injury in the context of this breach of contract suit and

that General Reinsurance is entitled to litigate the date of injury. This Order constitutes the 

findings of fact and conclusions of law required by Federal Rule of Civil Procedure 52(a)(1).

Because the Court has answered the Phase One questions in General Reinsurance’s favor, 

this matter shall proceed to Phase Two, in which the parties may actually litigate the date of injury 

and the Court will make a final coverage determination. The parties shall submit by July 8, 2015, 

a proposed schedule for Phase Two, including deadlines for the exchange of medical expert 

reports and a suggested date for the one-day bench trial.

IT IS SO ORDERED.

Dated: June 24, 2015

________________________

JACQUELINE SCOTT CORLEY

United States Magistrate Judge

Case 3:14-cv-01866-JSC Document 43 Filed 06/24/15 Page 23 of 23