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People v. Super. Ct.

Filed 6/26/17 IN THE SUPREME COURT OF CALIFORNIA THE PEOPLE, ) ) Petitioner, ) ) S232639 v. ) ) Ct.App. 4/2 E062380 THE SUPERIOR COURT OF ) RIVERSIDE COUNTY, ) ) Riverside County Respondent; ) Super. Ct. No. INF1302523 ) HOSSAIN SAHLOLBEI, ) ) Real Party in Interest. ) ____________________________________) Government Code section 1090 prohibits public officers and employees from making contracts in which they have a financial interest when they act in their official capacities. Knowing and willful self-dealing can result in criminal liability. In this case, the District Attorney of Riverside County seeks to prosecute Dr. Hossain Sahlolbei under section 1090 for allegedly influencing the public hospital where he worked to hire another doctor and then profiting from that doctor‘s contract. The Court of Appeal held that because Sahlolbei was an independent contractor and not an employee of the hospital, section 1090 does not apply to Sahlolbei. We conclude that independent contractors are not categorically excluded from section 1090. Liability under the statute can extend to independent contractors who have duties to engage in or advise on public contracting. Because Sahlolbei‘s duties brought him within the scope of the statute, we reverse. I. Sahlolbei was a surgeon at Palo Verde Hospital (the Hospital) in Blythe, Riverside County. The Hospital is a public entity under California law. It is undisputed that Sahlolbei was an independent contractor and never an employee of the Hospital. In addition to providing medical services as the Hospital‘s codirector of surgery, Sahlolbei served on the Hospital‘s medical executive committee (the Committee). The Committee, comprised of members of the medical staff, is independent of the Hospital and advises the board of governors of the Hospital (the Board) on the Hospital‘s operations, including physician hiring. Sahlolbei was at times the chief of staff or the vice-chief of staff of the Committee, and he is alleged to have had considerable influence over the Board‘s decisions in those roles. The prosecution alleges that Sahlolbei in 2009 recruited an anesthesiologist, Dr. Brad Barth, to work at the Hospital. Sahlolbei negotiated a contract with Barth under which Barth would receive $36,000 a month with a one-time relocation fee of $10,000. But Sahlolbei pressured the Board into hiring Barth for $48,000 a month with a one-time relocation fee of $40,000 as well as a directorship position of $3,000 a month. Sahlolbei allegedly threatened to have the medical staff stop admitting patients to the Hospital if the Board did not agree to his terms. Sahlolbei instructed Barth to have Barth‘s paychecks deposited directly into Sahlolbei‘s account, out of which Sahlolbei remitted to Barth the $36,000 a month on which they had agreed. The Board was not aware that Sahlolbei was profiting from Barth‘s contract. When this was brought to the Board‘s attention, the Hospital renegotiated Barth‘s contract to pay Barth directly. 2 The Riverside County District Attorney charged Sahlolbei with grand theft and violation of Government Code section 1090, which provides in relevant part: ―Members of the Legislature, state, county, district, judicial district, …
Original document
Source: California Supreme Court