Suit Against CalPERS Survives Demurrer For The Time Being

Last Friday, I wrote this post about Sacramento Superior Court Judge Allen Sumner’s tentative ruling in a case alleging that CalPERS improperly laundered the salary of the receiver appointed by the U.S. District Court to oversee California’s prison health care. On Tuesday, Judge Sumner signed this order. Consistent with the tentative ruling, the case has survived for now CalPERS’ demurrer.[1] However, Judge Sumner has asked for additional briefing on the question of the petitioner’s standing. Thus, it remains to be seen whether the case will survive.

In 2005, U.S. District Court Judge Thelton E. Henderson established a receivership for medical care in California’s prisons. The Receiver reports to the federal court, not the Governor. The gist of the petitioner’s claim is that the California Judicial Council through the Administrative Office of the Courts appointed the current receiver as a “Federal Court Consultant” and then “loaned” the receiver to the California Prison Health Care Receivership Corporation (the “CPHCR Corporation”). The alleged purpose of all these machinations was to maintain the receiver’s eligibility with CalPERS.

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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