BILL ANALYSIS                                                                                                                                                                                                    �




                   Senate Appropriations Committee Fiscal Summary
                           Senator Christine Kehoe, Chair

                                          SB 206 (Kehoe)
          
          Hearing Date: 4/11/2011         Amended: 3/15/2011
          Consultant: Bob Franzoia        Policy Vote: None
          
















































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          BILL SUMMARY: SB 206, an urgency measure, would appropriate 
          $600,000 from the State Board of Chiropractic Examiners' Fund to 
          the State Board of Chiropractic Examiners (board) to pay for the 
          settlement in the case of Catherine Hayes v. Board of 
          Chiropractic Examiners  (Sacramento County Superior Court, Case 
          No. 34-2008-0000647).  Any funds appropriated in excess of the 
          amounts required for payment of this claim shall revert to the 
          State Board of Chiropractic Examiners' Fund on June 30 of the 
          fiscal year in which the final payment is made.
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          ____
                            Fiscal Impact (in thousands)

           Major Provisions         2011-12      2012-13       2013-14    Fund
           Appropriation          $600                             Special*
          * State Board of Chiropractic Examiners' Fund
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          ____

          STAFF COMMENTS: This bill meets the criteria for referral to the 
          Suspense File.
          Pursuant to the committee's rules, the Suspense File rule does 
          not apply to the provisions of this bill as judgments and 
          settlement are considered valid obligations of the state.  
          Additionally, judgments and settlements may have time 
          sensitivity.
           
          Catherine Hayes v. Board of Chiropractic Examiners
          Sacramento County Superior Court, Case No. 34-2008-0000647
          $600,000 stipulated settlement
           
          The board agreed to a stipulated settlement with the former 
          Board Executive Officer, Catherine Hayes, to settle this case.  
          Pursuant to the settlement agreement, the board agreed to pay 
          Hayes a total sum of $600,000 in full settlement of this case.

          Hayes had alleged the board retaliated against her, terminating 
          her employment as a result of (1) her testimony and cooperation 
          in criminal investigations and prosecutions of chiropractors in 
          the County of San Joaquin relating to the practice of 
          manipulation under anesthesia; (2) conspiring to affect the 
          outcome of criminal prosecutions by voting to recognize 
          manipulation under anesthesia as falling within the chiropractic 
          scope of practice; (3) intimidating witnesses called to testify 








          SB 206 (Kehoe)
          Page 3

          in the criminal proceedings, (4) her reprimand of board members 
          for presumptively violating the Bagley-Keene Open Meetings Act 
          through serial communications outside the board meetings; (5) 
          her refusal to illegally terminate the employment of a civil 
          service employee against the boards' demands; (6) gender 
          discrimination in hiring and pay for replacement executive 
          officers; and (7) defamation based on an article written about 
          the policies and practices of the board staff.

          The board, represented by the Department of Justice, recently 
          suffered an adverse verdict at trial in a case in which the 
          department had advised presented little or no liability 
          exposure.  The jury award exceeded $1,000,000 in compensatory 
          damages, with an award of attorney's fees and costs in excess of 
          $1,000,000 to be determined by the court.  The facts and 
          circumstances of the Hayes dispute combined with the recent 
          experience at trial compelled the settlement resolution.