Kaiser Arbitration May Be Unenforceable, Says Unfair Business Competition
Case Finalized Today
To: State and City Desk

Contact: Carmen Balber of Election Watchdog, 310-392-0522, ext. 324; web:

LOS ANGELES, March 17 /U.S. Newswire/ — The son of a Kaiser Permanente
patient who died under Kaiser’s care filed final papers with the court today
in a groundbreaking suit which requires Kaiser to disclose to patients that
its arbitration provisions may be unenforceable. Kaiser routinely funnels
aggrieved patients and survivors into binding arbitration and denies them
access to the courtroom. Chant Yedalian’s case, brought under the unfair
business competition law and finalized today, restricts the ability of the
HMO to continue forcing arbitration on patients as a way to limit their
liability.
Yedalian went to law school following his mother’s death to find a way to
prevent others from suffering as his mother did. Now, Kaiser has contributed
$100,000 to a ballot initiative which would gut the unfair business
competition law, which Yedalian used to force Kaiser’s disclosure.

“Kaiser broke California law by forcing patients into secret arbitration
proceedings without fully and properly disclosing that they had given up
their rights. Today’s filing closes the door on the HMO’s illegal actions.
The unfair business competition law was the only tool I had to hold Kaiser
accountable for its deception. With today’s resolution of the case, Kaiser
should take back the donation it made to the anti- patient initiative and
stop its efforts to restrict patients’ rights,” said Yedalian.

Mandatory arbitration is a private proceeding in which there is no public
record or judicial appeal, and arbitrators are often biased in favor of the
HMO. Kaiser failed to follow state law requiring the HMO to disclose to
enrollees that they were giving up their right to go to court in case of a
dispute. Because of this failure, a court found that the HMO’s arbitration
provision was not enforceable. Yedalian’s suit forced Kaiser to disclose to
patients considering a medical malpractice claim that they may not be bound
to arbitration. After the document filed today is signed by the court, the
action will be dismissed and the court will retain jurisdiction over the
case to ensure that the settlement is enforced and Kaiser informs patients
of their rights.

Yedalian’s mother, Zevart, died in 1998 at the age of 53. She died from
breast cancer after Kaiser denied her a bone marrow transplant that could
have saved her life. His only avenue to ensure that other Kaiser patients
are not secretly deprived of their day in court through hidden mandatory
arbitration agreements was the state’s unfair business competition law.
Under the initiative to gut the law, currently circulating for the November
ballot, Yedalian’s case could never have been brought.

Yedalian joined over 60 public interest groups last week who have asked that
Kaiser and other corporate donors withdraw their support of the
anti-consumer initiative. (Read their letter at
Read the
initiative at .

“Kaiser should not be using premium dollars to fight against patient rights
and HMO accountability,” said Carmen Balber, a consumer advocate with
Election Watchdog. “This ballot initiative is an attempt by big business to
eliminate responsibility when they mislead, abuse and cheat consumers.”

The unfair business competition law was “the only vehicle we had to
vindicate the public’s constitutional right to trial by jury,” said
Yedalian.

Insurance, HMO and auto companies are bankrolling the initiative which would
eliminate the right of public interest organizations to bring cases on
behalf of Californians to prevent injury or harm to the environment,
workers, consumers or the public health, instead only allowing cases brought
by the government or after the damage has been done. Further, the
legislature would never be allowed to amend the law.

The big business initiative is in part a response to successful suits
brought by the Foundation for Taxpayer and Consumer Rights and other
organizations under the Unfair Business Competition Law against HMOs that
put profits before patients and insurance companies that low-balled claims
in the wake of the Northridge earthquake.

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Election Watchdog is a political action committee sponsored by Consumer
Watchdog, a nonprofit public benefit corporation organized in California.
Election Watchdog was organized to protect consumers’ interests in the
ballot initiative process and does not take positions on candidate
elections. Consumer Watchdog is the advocacy and campaign affiliate of the
Foundation for Taxpayer and Consumer Rights (FTCR). Learn more at