Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-casd-3_14-cv-00164/USCOURTS-casd-3_14-cv-00164-6/pdf.json

Nature of Suit Code: 362
Nature of Suit: Medical Malpractice
Cause of Action: 42:1395 Emergency Medical Treatment and Active Labor Act

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UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF CALIFORNIA

YARET MORALES, as next friend 

of ESTELA LOREDO MORALES, 

the real party in interest,

Plaintiffs, 

v.

PALOMAR HEALTH; et al., ,

Defendants. 

Case No.: 14cv164-GPC-MDD

REPORT AND 

RECOMMENDATION 

APPROVING MINOR'S PETITION 

AND COMPROMISE AND FOR 

FEES AND COSTS 

[ECF NO. 182]

On January 23, 2014, Plaintiff filed a complaint against Rady 

Children’s Hospital and Health Center (“Rady”) and Children’s Specialists of 

San Diego, a Medical Group, Inc. (“Specialists”). 1 (ECF No. 1). The parties 

reached a settlement and on May 30, 2017, Plaintiff Yaret Morales, Estela

 

1 Eight Defendants were originally named in the suit. Defendant United States of 

America was terminated from the case by way of a motion to dismiss which was granted 

on March 17, 2016. (ECF No. 101). Defendant Wendy Hunter, M.D. was terminated from 

the case by way of a motion to dismiss which was granted on May 25, 2016. (ECF No. 113). 

On September 12, 2016, Defendant Palomar Health, Bruce Friedburg and CEP American, 

LLC reached an agreement with Plaintiffs to be dismissed from the case with each party 

to bear their own costs. (ECF No. 139). 

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Loredo Morales’ next friend (“Plaintiff”) filed a Petition for Compromise of the 

Claim of minor and real party in interest, Estela Loredo Morales. (ECF No. 

182). 

It is well settled that the district court has a special duty, rising out of 

Federal Rule of Civil Procedure 17(c), to safeguard the interests of litigants 

who are minors within the context of settlements proposed in civil suits with 

minors and plaintiffs. The duty obliges the court to “conduct its own inquiry 

to determine whether the settlement serves the best interests of the minor.” 

Dacanay v. Mendoza, 573 F.2d 1075, 1080 (9th Cir. 1978). The Ninth Circuit 

has held that this “duty requires only that the district court determine 

whether the net amount distributed to [a] minor plaintiff in the proposed 

settlement is fair and reasonable, without regard to the proportion of the 

total settlement value. . . .” Robidoux v. Rosengren, 638 F.3d 1177, 1179 (9th 

Cir. 2011). Here, the Court has considered the Petition, the supplemental 

information and after conducting an independent inquiry and evaluation of 

the proposed settlement, the Court finds that the proposed settlement is fair 

and reasonable and serves the best interest of Estela Loredo Morales, a 

minor. 

IT IS HEREBY RECOMMENDED that the settlement between 

defendant Rady Children’s Hospital and Health Center, and defendant 

Children’s Specialist of San Diego, A Medical Group, Inc. and Plaintiff 

(including Estela Loredo Morales, real party in interest) be approved.

The Settlement as to defendants “Rady” and “Specialists” is set forth in 

Plaintiff’s Ex Parte Motion. (ECF No. 182). The amount to be paid to Plaintiff 

by defendant Rady is $150,000.00. (Id. at 2). The amount to be paid to 

Plaintiff by defendant Specialists is $150,000.00. (Id.). The proceeds of the 

settlement shall be disbursed in the following manner:

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1. Rady Children’s Hospital and Health Center shall pay to the Casey 

Gerry Trust Account the amount of $150,000.00;

2. Children’s Specialists of San Diego, a Medical Group, Inc., shall pay 

to the Casey Gerry Client Trust Account the amount of $150,000.00;

3. $128,031.50 from the settlement funds shall be paid to the Special 

Needs Trust, First Party Master Trust II, on behalf of Estela Loredo 

Morales pursuant to the San Diego Superior Court order dated May 

9, 2017, (ECF No. 182-1, Exhibit1) approving the establishment of a 

special needs trust for Estela Loredo Morales for the settlement 

funds from this action;

4. $107,069.11 shall be paid from the settlement funds to Plaintiff’s 

attorneys for litigation costs they have advanced in this action;

5. $59,899.39 shall be paid from the settlement funds to Plaintiff’s 

attorneys for their attorney’s fees in litigating this action for 

Plaintiff;

6. $5,000.00 shall be paid to the law firm of Battaglia and Waltari for 

preparing a special needs trust for Plaintiff’s settlement funds.

IT IS FURTHER RECOMMENDED:

1. Plaintiff be authorized and directed to execute any and all 

documents reasonably necessary to carry out the terms of the 

settlement.

2. Plaintiff shall be responsible for maintaining a current address on 

behalf of Estela Loredo Morales with the Special Needs Trust and 

defendants “Rady” and “Specialists” until such time as the above 

payment schedule is completed. 

3. Plaintiff shall have seventy-five days from the date that this report 

and recommendation is adopted to submit proof of funding of the 

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Special Needs Trust to the court.

4. After Plaintiff has received the cash payment from defendants, 

Plaintiff shall cause her attorney to file with the United States 

District Court for the Southern District of California a dismissal of 

this action against defendant “Rady” and defendant “Specialist” with 

prejudice. 

This Report and Recommendation of the undersigned Magistrate

Judge is submitted to the United States District Judge assigned to this case, 

pursuant to the provisions of 28 U.S.C. § 636(b)(1). Any written objections to 

this report must be filed with the court and served on all parties no later 

than July 26, 2017. The document should be captioned “Objections to Report 

and Recommendation.” 

 Any reply to the objections shall be filed with the court and served 

on all parties no later than August 2, 2017. The parties are advised that 

failure to file objections within the specified time may waive the right to 

those objections on appeal of the Court's order. Martinez v. Ylst, 951 F.2d 

1153 (9th Cir. 1991). 

IT IS SO ORDERED.

Dated: July 11, 2017

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