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Deborah Gray v. John Chiu et al

January 22, 2013


Timothy J. Staffel, Judge Superior Court County of Santa Barbara (Super. Ct. No. 1274258)

The opinion of the court was delivered by: Perren, J.


(Santa Barbara County)

The parties to a medical malpractice arbitration agree upon a neutral arbitrator. Subsequent to commencing arbitration proceedings but prior to the hearing, counsel for the defendant doctor affiliates with the firm providing the arbitrator. Neither counsel nor the arbitrator discloses that relationship. Here we conclude that the California Arbitration Act (the Act) (Code Civ. Proc., § 1280 et seq.),*fn1 and the California Ethics Standards for Neutral Arbitrators in Contractual Arbitrations (Ethics Standards) require that the arbitrator disclose the relationship. The Act and the Ethics Standards require (1) a neutral arbitrator to disclose that a lawyer in the arbitration is a member of the administering "dispute provider resolution organization" (DRPO); and (2) section 1286.2, subdivision (a)(6) compels a trial court to vacate the arbitration award if the arbitrator fails to disclose that information.

In her appeal from the judgment affirming a medical malpractice arbitration award in favor of respondents, appellant Deborah Gray contends that the trial court erred by denying her petition to vacate the award on the ground that the arbitrator violated the disclosure provisions of the Act and the Ethics Standards. We agree and reverse.


For many years, William Ginsburg represented respondent John Chih Chiu, M.D. (Chiu). In January 2009, appellant and her husband, Tom Gray, filed a medical malpractice complaint against Chiu, California Back Specialist Medical Group, California Minimally Invasive Surgical Center, Inc., and Thousand Oaks Spine Medical Group (respondents). The complaint alleged that appellant was injured by respondents' negligent treatment during and following spinal disc surgery, and that Tom Gray suffered a loss of consortium.*fn2

Attorney Eugene D. Locken represented appellant and Tom Gray. The Peterson & Bradford firm (Ginsburg, of counsel) represented respondent Chiu. Ginsburg was the lead trial attorney for the defense team. On July 20, 2009, the trial court granted respondents' motion to compel arbitration under the terms of the parties' "Physician-Patient Arbitration Agreement." The agreement provides for a three-member arbitration panel consisting of one arbitrator selected by the plaintiff, and one selected by the defense (party arbitrators), with a neutral arbitrator to be selected by the party arbitrators. Ginsburg helped select the defense party arbitrator.

In September 2009, Ginsburg announced that he would retire from Peterson & Bradford, and the practice of litigation, and become an arbitrator. He started an "arbitration/mediation business known as William H. Ginsburg Mediation Services." For a while, he continued working at Peterson & Bradford. An email message from Ginsburg dated October 6, 2009, stated, "I'm doing [alternative dispute resolution] with ADR Services, Inc. . . . ." George E. Peterson, a partner at Peterson & Bradford, became lead trial counsel for the defense of this matter, and Chiu retained Ginsburg as his personal counsel.

In October 2009, the party arbitrators selected the Honorable Robert T. Altman (Ret.) as the neutral arbitrator. In November 2009, ADR Services, Inc. (ADR) notified the party arbitrators that Judge Altman could not serve. The party arbitrators then selected the Honorable Alan Haber (Ret.) as the neutral arbitrator.

Judge Haber sent the parties a disclosure statement in January 2010 and a supplemental disclosure statement in April 2010. On each occasion, Judge Haber stated that he had no significant personal relationship or other professional relationship with any party, or lawyer for a party. Both disclosure statements listed the names of participants for whom a conflict check was performed, including several attorneys and firms. Ginsburg was not named on either disclosure statement.

The arbitration took place at the ADR Century City office, over nine working days from January 31, 2011, through February 10, 2011. Ginsburg attended all sessions of the arbitration, as personal counsel for Chiu, and used the defense team's private room to speak with Chiu and Peterson. Several weeks after the sessions concluded, Judge Haber issued a binding arbitration award for respondents. The award included findings that appellant failed to meet the burden of proving that respondents' care of her was "below the standard of care and practice," or that respondents caused her injuries.

Appellant filed a petition to vacate the arbitration award on multiple grounds, including the failure of Judge Haber to disclose that Ginsburg was an ADR member. The parties presented written and oral arguments, declarations, and documentary exhibits, but no live testimony.

Ginsburg submitted a declaration stating that he first began providing arbitration services through ADR in March 2010, and served on their panel as an independent contractor, without any formal contract. He had no financial interest in ADR. Ginsburg attended some of the expert depositions relating to this matter in 2010. He did not actively participate. During 2010, Ginsburg told Locken that he was performing arbitrations and mediations. He recalled giving Locken his ADR business card in 2010. The hallways and meeting areas of the ADR Century City office displayed posters with photographs and names of ADR panel members, including Ginsburg. ADR brochures throughout ...

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