Document ID: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caed-2_06-cv-01921/USCOURTS-caed-2_06-cv-01921-2/pdf.json

Parties Involved:
Kristine Blas
Defendant
Broadspire Services, Inc.
Defendant
Darlene Gomes
Plaintiff
Michaels Stores, Inc.
Defendant

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On October 26, 2006, the court found that Kristine Blas, a 1

Broadspire agent, was an improperly joined defendant and was

therefore dismissed pursuant to Rule 21. 

1

UNITED STATES DISTRICT COURT

FOR THE EASTERN DISTRICT OF CALIFORNIA

DARLENE GOMES,

NO. CIV. S-06-1921 LKK/KJM

Plaintiff,

v.

O R D E R

MICHAELS STORES, INC.;

BROADSPIRE SERVICES, INC.;

KRISTINE BLAS; and 

DOES 1-100,

Defendants.

 /

Darlene Gomes (“plaintiff”) brings a wrongful termination

action against her former employer, Michaels Stores, Inc.

(“Michaels”) and Broadspire Services Inc., Michaels workers’

compensation insurance carrier (“Broadspire”). Pending before the 1

court is a motion to dismiss filed by Broadspire. Broadspire

maintains that the Workers’ Compensation Act provides the exclusive

remedy for plaintiff’s claims. For the reasons set forth below,

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the court grants Broadspire’s motion. 

I.

BACKGROUND FACTS

1. Facts as Alleged in the Complaint

Plaintiff began employment with Michaels in July of 1994 and

held the position of Office Specialist. In 2003, plaintiff was

promoted to the position of Lead Sales Person, and in August of

2004 she was again promoted to Front End Supervisor. She held this

position until the termination of her employment on October 15,

2004. Plaintiff alleges that at all times during her employment

Broadspire was the workers’ compensation insurance carrier for her

employer, Michaels.

In December of 1999 plaintiff sustained a work-related injury

which affected her right shoulder, leg, hip and arm. She was

treated and released to return to work shortly thereafter.

Plaintiff subsequently filed a claim for workers’ compensation.

This claim is still pending. 

According to plaintiff, Broadspire requested that plaintiff

submit to a series of medical examinations and misrepresented the

purpose of these examinations. Plaintiff alleges that the true

intention of these exams was for Michaels to use the information

as a basis of terminating plaintiff’s employment. Similarly, prior

to a medical examination on September 24, 2004, Broadspire

allegedly forwarded to the medical examiner an outdated description

of plaintiff’s occupational duties. This description allegedly

referred to the position of Lead Sales Associate, when at that time

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plaintiff held the position of Front End Supervisor. Pursuant to

this incorrect occupational description and the multiple medical

reviews, an allegedly inaccurate medical report was issued and

plaintiff was given work restrictions that Michaels was unable to

accommodate. Rather than accommodate plaintiff’s needs, Michaels

elected to terminate her.

2. Plaintiff’s Claims

Plaintiff alleges that Michaels sought to avoid paying her

future medical expenses and that together with Broadspire,

conspired to terminate her employment. She states five causes of

action against Broadspire: (1) invasion of privacy; (2) conspiracy

to terminate; (3) fraud & deceit; (4) unfair competition; and (5)

intentional infliction of emotional distress. Plaintiff alleges

these same five claims against Michaels, as well as additional

claims for wrongful termination in violation of public policy and

failure to make timely payment of wages, in violation of Cal. Lab.

Code § 203. 

Broadspire now moves to dismiss on the grounds that

plaintiff’s claims stem from an injury sustained at work and

therefore, her sole remedy is found in the workers’ compensation

system.

II.

Standard for Motion to Dismiss

On a motion to dismiss, the allegations of the complaint must

be accepted as true. See Cruz v. Beto, 405 U.S. 319, 322 (1972).

The court is bound to give the plaintiff the benefit of every

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reasonable inference to be drawn from the "well-pleaded"

allegations of the complaint. See Retail Clerks Intern. Ass'n,

Local 1625, AFL-CIO v. Schermerhorn, 373 U.S. 746, 753 n.6 (1963).

Thus, the plaintiff need not necessarily plead a particular fact

if that fact is a reasonable inference from facts properly alleged.

See id.; see also Wheeldin v. Wheeler, 373 U.S. 647, 648 (1963)

(inferring fact from allegations of complaint).

In general, the complaint is construed favorably to the

pleader. See Scheuer v. Rhodes, 416 U.S. 232, 236 (1974). So

construed, the court may not dismiss the complaint for failure to

state a claim unless it appears beyond doubt that the plaintiff can

prove no set of facts in support of the claim which would entitle

him or her to relief. See Hishon v. King & Spalding, 467 U.S. 69,

73 (1984) (citing Conley v. Gibson, 355 U.S. 41, 45-46 (1957)).

In spite of the deference the court is bound to pay to the

plaintiff's allegations, however, it is not proper for the court

to assume that "the [plaintiff] can prove facts which [he or she]

has not alleged, or that the defendants have violated the . . .

laws in ways that have not been alleged." Associated General

Contractors of California, Inc. v. California State Council of

Carpenters, 459 U.S. 519, 526 (1983).

III.

Analysis

Because the WCA provides the exclusive remedy for work-related

injuries and claims deriving from such an injury, plaintiff may

only seek remedies for her present claims within the WCA. The

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 Cal. Lab. Code § 5300 states in part: 2

All the following proceedings shall be instituted before

the appeals board and not elsewhere, except as otherwise

provided in Division 4:

(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, his or her dependents, or any

third person.

...

(f) For the determination of any other matter,

jurisdiction over which is vested by Division 4 in

the Division of Workers' Compensation, including

the administrative director and the appeals board.

5

court’s task, therefore, is to determine whether the pending claims

against Broadspire are sufficiently tied to plaintiff’s

occupational injury to be barred by the WCA exclusivity provision.

The court sets forth the relevant legal framework and then

addresses the five claims which pertain to Broadspire. 

1. Workers’ Compensation Exclusivity

An employee's right to recover against an employer is usually

limited to remedies set forth in the Workers' Compensation Act.

(Cal. Lab. Code § 5300). The exclusivity feature of the workers' 2

compensation system is sometimes known as the "compensation

bargain." Shoemaker v. Myers, 52 Cal. 3d 1, 15-16 (1990). The

function of exclusivity, "is to give efficacy" to that bargain.

Id. at 16. Under this “bargain,” 

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 Unruh was overruled by statutory amendment on other grounds. 3

Cal. Lab. Code § 3602 (expressly eliminating the "dual capacity"

doctrine as an exception to workers’ compensation exclusivity). 

The dual capacity doctrine is not relevant in the case at bar. 

6

the employer assumes liability for industrial personal injury

or death without regard to fault in exchange for limitations

on the amount of that liability. The employee is afforded

relatively swift and certain payment of benefits to cure or

relieve the effects of industrial injury without having to

prove fault but, in exchange, gives up the wider range of

damages potentially available in tort. 

Id. The Legislature has extended the protection of these exclusive

remedy provisions to workers' compensation insurance carriers by

defining the word "employer" to include "insurer." (Cal. Lab. Code.

§ 3850(b).) This provision similarly limits the insurer’s exposure

to liability with respect to the employee. 

The court in Unruh v. Truck Ins. Exchange, 7 Cal. 3d 616, 630

(1972) provides insight into the objective of the Legislature's 3

perception of the workers’ compensation scheme: 

A negligent investigation of an employee's claim may well be

an aberration in the carrier's normal activities, but when it

does have a harmful effect on the employee, we see no reason

why it cannot be treated by the Board as a compensable

aggravation of the original injury, if the evidence so

warrants. This result provides for prompt and effective

relief within the compensation scheme without disturbing the

administrative process. We can find no justification either

in statutory or policy considerations for treating the

negligent carrier as no longer acting as a carrier but rather

as a third party

Unruh, 7 Cal. 3d at 628.

a. The Test for Exclusivity 

Determining whether a claim is barred by the exclusivity

provision of the WCA involves a three step analysis. First, ”the

trigger for workers' compensation exclusivity is a compensable

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injury,” Charles J. Vacanti, M.D., Inc. v. State Comp. Ins. Fund,

 24 Cal. 4th 800, 813 (2001). A workplace injury, such as the one

alleged in the case at bar, constitutes a compensable injury. Id.

The second prong of the analysis is determining whether the

alleged claims raised in the complaint are “collateral to or

derivative” of the compensable injury. Id. Claims which are

collateral to or derivative of the compensable injury are barred

under the exclusivity clause. Moreover, it is well established

that disputes which arise over the handling of compensation claims

“fall within the scope of the exclusive remedy provisions because

this process is tethered to a compensable injury.” Id. at 815.

See also Marsh & McLennan, Inc v. Superior Court, 49 Cal. 3d 1, 8

(1989) (“[t]he workers’ compensation system encompasses all

disputes over coverage and payment, whether they result from

actions taken by the employer, [or] by the employer’s insurance

carrier”); Stoddard v. Western Employers Ins. Co., 200 Cal. App.

3d 165, 168-69 (4th Dist. 1988) (injury claim resulting from a

delay in payment of benefits is confined to the jurisdiction of the

WCAB).

If the claims are collateral to or derivative of the

compensable injury, a plaintiff may still pursue his or her causes

of action if the, fit within the "narrow exception to the [WCA]

jurisdiction" established in Unruh, 7 Cal. 3d at 630, see Vacanti,

24 Cal.4th at 819. This narrow exception applies when the conduct

by an employer or insurer goes beyond the normal role contemplated

in the compensation scheme. See Unruh, 7 Cal. 3d at 630. Conduct

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‘so extreme and outrageous that’ the insurer ‘in effect stepped out

of its role as’ an insurer precludes the application of workers'

compensation exclusivity. Vacanti, 24 Cal. 4th at 820, (citing

Marsh, 49 Cal. 3d at 11); see also Unruh, 7 Cal. 3d at 616 (actions

by claims investigator who became romantically involved with

claimant were not subject to WCA exclusivity). 

The California courts have construed this exception narrowly.

Marsh & McLennan, 49 Cal. 3d at 6. Even allegations of fraud and

misconduct by an insurer in the processing of claims are subject

to the exclusive jurisdiction of the WCAB. Vacanti, 24 Cal. 4th

at 821; see also Mitchell v. Scott Wetzel Services, Inc., 227 Cal.

App. 3d 1474 (4th Dist. 1991) (WCA holds exclusive jurisdiction

over injured employee’s allegations of insurer misrepresentations

and perjury in connection with claims handling). 

In making this determination, courts may consider only those

acts that relate to an element of the cause of action. Where these

acts are “a normal part of the employment relationship” or the

workers' compensation claims process, the cause of action is

subject to exclusivity. Vacanti, 24 Cal.4th at 820. As the

Vacanti court explained: 

Insurer activity intrinsic to the workers' compensation

claims process is also a risk contemplated by the

compensation bargain. Thus, insurer actions ‘closely

connected to the payment of benefits’ fall within the scope

of the exclusive remedy provisions. 

Id. at 821 (citations omitted). For example, a claims

investigation, by itself, does not exempt a cause of action from

exclusivity. See Unruh, 7 Cal.3d at 628-629. As the Vacanti court

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observed, “California courts have invariably barred statutory and

tort claims alleging that an insurer unreasonably avoided or

delayed payment of benefits even though the insurer committed fraud

and other misdeeds in the course of doing so.” Vacanti, 24 Cal. 4th

at 821. In short, “where the tortious act is not closely connected

to a normal employer or insurer action, it is not subject to

exclusivity.” Id. at 822. 

Similarly, in making this determination, “courts consider only

the acts themselves-and not the motive behind the acts.” Id. “The

critical issue is whether the alleged acts, bereft of their

motivation, ‘can ever be viewed as a normal aspect of the employer

relationship’ or claims process.” Id. at 822 (citations omitted).

 Thus, 

[C]ourts should disregard any alleged intent beyond the

intent to do the acts that establish the elements of the

cause of action when determining whether these acts are

encompassed within the compensation bargain. Such a focus is

necessary in order to preserve the compensation bargain.

Indeed, permitting civil claims based on conduct that

‘appeared on its face to be a normal part of the employment

relationship [or claims process] ... merely because the

mental state ... rendered the conduct intentionally or

knowingly tortious’ undermines the premise behind the

workers' compensation system. 

Vacanti, 24 Cal.4th at 820 (citations omitted); see also

Fermino v. Fedco, Inc., 7 Cal.4th 701, 717 (1994) (holding that

normal employer actions causing injury does not fall outside the

scope of the exclusivity rule merely by plaintiff attributing to

the employer a sinister intention). 

Finally, in “adjudicating whether a claim falls within the

workers' compensation system, all doubt should be resolved in favor

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 It is not clear to the court why the ordinary rules of joint 4

action do not apply, but as I indicate above, they apparently do

not.

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of finding jurisdiction within the workers' compensation system.”

Mitchell, 227 Cal. App. 3d at 1480; see also Fremont Indemnity Co.

v. Superior Court, 133 Cal. App.3d 879, 881 (2nd Dist. 1982) ("The

preferred policy is to repose in the WCAB as much as possible

resolution of problems and alleged claims arising out of workers’

compensation matters."]; Gilford v. State Compensation Ins. Fund,

41 Cal. App. 3d 828, 834 (1st Dist. 1974) (“Where there is any

reasonable doubt as to the jurisdiction, the courts must resolve

such doubts in favor of jurisdiction”). Accordingly, a close case

should be found to fall within the exclusivity provision of WCA.

2. Plaintiff’s Claim for Conspiracy to Terminate in Violation of

Public Policy

As a threshold matter, the court addresses plaintiff’s third

cause of action which alleges that Broadspire conspired to

terminate plaintiff’s employment in violation of public policy.

This claim is dismissed on the grounds that Broadspire cannot be

liable for an act that it cannot commit, namely, terminating

plaintiff’s employment.4

California courts have consistently held that “a third party

who is not and never has been the plaintiff’s employer cannot be

bootstrapped by conspiracy into tort liability for a wrong he is

legally incapable of committing.” Weinbaum v. Goldfarb, Whitman

& Cohen, 46 Cal. App. 4th 1310, 1313 (2nd Dist. 1996); see also

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Khajavi v. Feather River Anesthesia Med. Group, 84 Cal. App. 4th

32, 55 (3rd Dist. 2000) (Plaintiff’s claim of conspiracy to

terminate his employment fails because a “non-employer

defendant-who cannot commit the tort of wrongful discharge in

violation of public policy-can have no liability for a conspiracy

to wrongfully discharge the employee.”)

As the insurance carrier to plaintiff’s employer, Broadspire

is not in an employment relationship with plaintiff. Like the

defendants in Weinbaum and Khahavi, Broadspire is a third party.

Simply put, a conspiracy to terminate claim cannot lie against the

insurer, who is not, and has not been, plaintiff’s employer.

Plaintiff spends the majority of her opposition arguing that

she was wrongfully discharged. Citing to City of Moorpark v.

Superior Court, 18 Cal. 4th 1143(1998), plaintiff argues that

workers’ compensation is not the exclusive remedy for disability

discrimination and wrongful discharge. The court agrees that

Moorpark supports the general principal that claims alleging

wrongful discharge or discrimination are not necessarily barred by

the exclusivity provision. What plaintiff fails to appreciate is

that the plaintiff in Moorpark brought suit against her employer.

The Moorpark plaintiff did not bring suit against a workers’

compensation carrier or claims administrator. In the case at bar,

plaintiff fails to cite to any legal basis for how Broadspire could

be held liable for a claim of wrongful termination. 

3. Plaintiff’s Tort-Based Claims

Plaintiff brings three causes of action against Broadspire

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which may be characterized as tort-based claims. They are:

invasion of privacy, fraud (and deceit), and intentional infliction

of emotional distress. The court must determine whether these

claims are barred by the exclusivity provision of the WCA. 

As discussed above, “the trigger for workers' compensation

exclusivity is a compensable injury,” Vacanti, 24 Cal.4th at 813.

A workplace injury, such as the one plaintiff suffered in December

of 1999, constitutes a compensable injury. Id. The court next

determines whether the alleged tort claims are “collateral to or

derivative” of the compensable injury. Claims which are collateral

to or derivative of the compensable injury are barred under the

exclusivity clause. If it is determined that the claims are

collateral to or derivative of the compensable injury, the court

also considers whether the Unruh exception precludes the

exclusivity bar. 

a. Invasion of Privacy & Intentional Infliction of

Emotional Distress 

Plaintiff claims that Broadspire invaded her right to privacy

and caused her emotional distress. Specifically, plaintiff alleges

that she was subjected to “multiple, intrusive physical

examinations based on fraudulent misrepresentations as to the real

purpose of said records.” Compl. ¶ 72. Plaintiff also claims that

defendants (she does not specify which) used her medical records

in an impermissible way, namely, to terminate her employment.

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 I note in passing plaintiff has not brought suit alleging 5

violation of the ADA or its state counterpart.

 This is not to say that plaintiff does not have a viable 6

claim against defendant Michaels. Whether Michaels invaded

plaintiff’s privacy and caused emotional distress, and whether

those claims would be barred under the exclusivity provision as to

Michaels, are not questions not before the court. 

13

Compl. ¶ 73. 

5

Both plaintiff’s claims for invasion of privacy and emotional

distress stem directly from her workers’ compensation claim. Being

subjected to repeated medical exams is collateral to and derivative

of her workplace injury. Indeed, the gist of plaintiff’s claims

“arise out of and in the course of” her workers’ compensation

claim. Vacanti, 24 Cal. 4th at 815. 

With respect to the records being used to terminate

plaintiff’s employment, as discussed above, Broadspire was not

legally capable of terminating plaintiff and therefor, cannot be

liable for that aspect of plaintiff’s claims. Moreover, merely 6

alleging that Broadspire acted with an illegal intent does not

remove the claim from the exclusivity bar. Fermino, 7 Cal.4th at

717.

The court next considers whether the conduct giving rise to

plaintiff’s alleged emotional injury and invasion of privacy is of

the kind reasonably encompassed in the compensation bargain. As

mentioned earlier, the question is “whether the alleged acts,

bereft of their motivation, ‘can ever be viewed as a normal aspect

of the...claims process.’” Vacanti, at 822. (citations omitted).

In the case at bar, all alleged conduct by Broadspire relates

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directly to the processing of plaintiff’s compensation claim.

Requests for medical examinations are a normal and necessary part

of the claims process. In this case, plaintiff was examined on

four separate occasions between September of 2000 and July of 2004.

As Broadspire points out in its motion to dismiss, the Labor Code

expressly envisions repeated medical examinations as part of the

workers’ compensation claim process: 

Whenever the right to compensation under this division exists

in favor of an employee, he shall, upon the written request

of his employer, submit at reasonable intervals to

examination by a practicing physician, provided and paid for

by the employer, and shall likewise submit to examination at

reasonable intervals by any physician selected by the

administrative director or appeals board or referee thereof.

Cal. Lab. Code § 4050 (emphasis added). The court finds that

four separate medical exams over the course of four years is

consistent with the Labor Code, clearly falls within the normal

workers’ compensation claims process and is not “outrageous or

extreme.” 

Plaintiff gives short shrift to these claims in her

opposition. Plaintiff argues that Broadspire was “motivated by an

illegal purpose, to disqualify the plaintiff for a job she was

already doing without restriction.” Pl.’s Opp’n at 10:1-3. She

also claims that Broadspire was acting outside of the their normal

role in the claims processing. Id. at 7. As noted above, it is

well established that motivation is not a factor the court

considers. See Vacanti, 24 Cal. 4th at 820-21. Moreover,

plaintiff fails to explain how being subjected to multiple medical

exams constitutes action which falls outside of an insurer’s normal

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actions in a workers’ compensation claim process. 

For these reasons, plaintiff’s claims for invasion of privacy

and intentional infliction of emotional distress are subject to the

WCA bar of exclusivity and must be dismissed.

b. Fraud & Deceit

Plaintiff next claims that Broadspire’s actions constituted

fraud and deceit. Plaintiff alleges that in reliance on fraudulent

statements made by Broadspire, she was forced to undergo medical

examinations, was placed on leave at work, and was ultimately

terminated due to her disability. Plaintiff specifically states

that Broadspire engaged in fraud when it required four medical

exams. In the general allegations section of the complaint,

plaintiff also claims that Broadspire knowingly provided the wrong

job description to the examining doctor. This faulty job

description caused the examining doctor to find that plaintiff

needed certain work restrictions. 

As with the claims for invasion of privacy and intentional

infliction of emotional distress, the claim regarding fraud and

deceit is collateral and derivative of plaintiff’s workers’

compensation claims process. Indeed, these claims are sufficiently

tethered to plaintiff’s workers’ compensation claim that any

allegation of fraud or deceit “can be well inquired into by the

board and where necessary, discipline imposed.” Marsh, 49 Cal.3d

at 7.

The court also determines that the acts implicated by

plaintiff’s claims do not go “beyond the normal role of an insurer

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in a compensation scheme” Unruh, 7 Cal. 3 at 630. As discussed

above, multiple medical exams do not constitute extreme or

outrageous conduct which falls outside of the normal course of a

workers’ compensation claim. 

Perhaps plaintiff’s strongest argument is that Broadspire

intentionally gave the examining doctor the wrong job description.

However, even this alleged wrong act falls within the normal

conduct of an insurer. Again, the court looks not to the alleged

motivation of the insurer, but only the act. Vacanti, 24 Cal.4th

at 820. Here, the allegations are insufficient for a finding that

by providing the wrong job description Broadspire “stepped out of

it’s role as an insurer.” Marsh, 49 Cal. 3d at 11. 

Indeed, as the Vacanti decision points out, with respect to

insurers, the conduct alleged must be extreme: 

courts have permitted fraud claims when the insurer denies

the existence of a workers' compensation insurance policy,

because such denials are not a normal part of the claims

process. Trespassing is also an atypical insurer activity

even when committed in the course of a claims investigation.

Therefore, it falls outside the compensation bargain.

Finally, assault and the formation of a romantic relationship

with an injured employee are not closely connected to the

claims process and are exempt from exclusivity. 

Vacanti, 24 Cal. 4th at 822-23 (citations omitted). It is

clear that in the few instances in which fraud claims have not been

barred, the alleged wrongful conduct was much more extreme than the

conduct alleged in the instant case. 

Other courts faced with fraud claims akin to those in the case

at bar have come to similar conclusions regarding exclusivity. See

Vacanti, 24 Cal. 4th at 829 (fraud claim barred by exclusivity of

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WCA); Lamke v. Sunstate Equipment Co., 387 F. Supp. 2d 1044, 1051

(N.D. Cal. 2004)(plaintiff’s fraud claim is "encompassed within the

compensation bargain"); Mitchell, 227 Cal. App. 3d at 1474 (4th

Dist. 1991) (WCA holds exclusive jurisdiction over injured

employee’s allegations of insurer misrepresentations and perjury

in connection with claims handling). 

For these reasons, the court finds that plaintiff’s fraud and

deceit claims are barred and must be dismissed. 

4. Plaintiff’s Unfair Competition Claim 

Plaintiff also alleges the Broadspire engaged in unfair or

fraudulent business practices, in violation of Cal. Bus. & Prof.

Code §§ 17200 et. seq. To plead a cause of action under the Unfair

Competition Law (“UCL”), a plaintiff must show that “members of the

public are likely to be deceived.” Quacchia v. DaimlerChrysler

Corp., 122 Cal. App. 4th 1442, 1453 (1st Dist. 2004). A plaintiff

does not need to state the elements of a tort. Id. Therefore,

claims under the UCL “only escape preemption if the underlying acts

fall outside the scope of the compensation bargain.” Vacanti, 24

Cal. 4th at 828. 

As best as the court can decipher from the complaint,

Broadspire’s alleged unfair or fraudulent conduct included requests

for medical examinations and misrepresentations regarding both the

purpose of these examinations and the physical duties required of

plaintiff’s job. However, plaintiff’s complaint contains no

allegations as to how these actions were likely to “deceive the

public.” The allegations suggest that plaintiff was deceived, but

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fails to discuss how the public was deceived. On this ground

alone, plaintiff’s claim must be dismissed.

The claim may also be dismissed on exclusivity grounds. For

the reasons noted earlier, the underlying acts which support

plaintiff’s UCL claim are all closely tied to the workers’

compensation claims process. Accordingly, plaintiff’s unfair

competition claim is barred by the WCA exclusivity rule.

V.

CONCLUSION

For the reasons explained above, Broadspire’s motion to

dismiss is GRANTED. 

IT IS SO ORDERED. 

DATED: November 15, 2006.

Case 2:06-cv-01921-LKK -KJM Document 25 Filed 11/16/06 Page 18 of 18