Co-authored by Hinshaw partner David Alfini and Adelman Firm, PLLC founder Rebecca Adelman, the following white paper is prepared for owners, operators, insurers, claims professionals, risk managers, and defense counsel in senior living and long-term care.
Executive Summary
On July 22, 2026, the California Court of Appeal (Second District, Division Seven) filed its partially published decision in Aud v. RRT Enterprises, LP (2026 Cal. App. LEXIS 449, B341254), reinstating a jury’s award of $1,837,032 in noneconomic damages against a skilled nursing facility and reversing the trial court’s reduction of that award to $250,000 under the Medical Injury Compensation Reform Act (MICRA).
The court held that the resident’s injuries—repeated falls, pressure injuries, malnutrition, and dehydration—arose from the facility’s failures as a custodian and caregiver, not as a healthcare provider, and that MICRA’s cap on noneconomic damages therefore did not apply at all.
Aud is the first published appellate decision to apply the California Supreme Court’s framework from Holland v. Silverscreen Healthcare, Inc. (2025) 18 Cal. 5th 364 to a full jury verdict, and it does so aggressively. Three of its holdings deserve particular attention:
1. The Care Plan Does Not Save You
Even where the facility properly performed a clinical fall-risk assessment and identified high-risk interventions, the failure to implement those interventions—supervision, call-light response, toileting assistance, alarms, adequate staffing—is custodial neglect outside MICRA.
Attaching the words “assessment,” “care plan,” or “nursing judgment” to operational failures will not convert them into professional negligence.
2. Mental State is Irrelevant to the MICRA Line
The jury found neglect but expressly found no recklessness, oppression, fraud, or malice. The defense argued that ordinary (non-egregious) neglect must therefore fall under MICRA.
The court rejected the argument: it is the type of conduct and the capacity in which the facility acted—not the defendant’s culpability—that controls. A facility can now face uncapped non-economic damages on a theory of simple negligence in custodial care.
3. The Plaintiffs’ Roadmap is Now Published
Holland and Aud together tell the plaintiffs’ bar exactly how to plead and try these cases: characterize every failure as supervision, staffing, hygiene, hydration, toileting, repositioning, or call-light response, and MICRA (and, in many cases, the resident’s arbitration agreement) falls away.
We should expect nearly every complaint filed against a California facility going forward to be drafted to this template.
The practical consequence is that MICRA can no longer be treated as a reliable damages backstop in California long-term care litigation. Defense of these claims must shift decisively toward:
operational and documentation practices that close the gap between assessment and implementation,
contract and arbitration architecture drafted with the custodial/medical line in mind,
litigation strategies that force pleading specificity and preserve MICRA, arbitration, and allocation arguments where genuinely medical conduct is at issue, and
claims-evaluation, reserving, and underwriting assumptions recalibrated for uncapped exposure.
Section by section, this alert traces the law, then sets out a concrete playbook for each stakeholder.
A status note: Aud was certified for partial publication and is citable, but it is not yet final. A Court of Appeals opinion ordinarily becomes final 30 days after filing, and a petition for review to the California Supreme Court remains possible. Its status should be confirmed before it is relied upon in a filed brief.
1. The Aud Decision
Facts and Trial Outcome
Betsy Jentz, a former marathon runner in her 80s, was admitted to Country Villa Wilshire Convalescent Center, a skilled nursing facility operated by RRT Enterprises, LP, in late 2020 for custodial care and rehabilitation following a hip fracture. On admission, the facility’s nursing staff assessed her as a high fall risk and recommended implementing high-risk fall interventions.
The evidence at trial showed what followed: her call light was frequently out of reach or not working; when it did work, responses took 30 to 45 minutes; staff did not provide regular toileting assistance or meaningful supervision; no bed alarm or observation arrangement was implemented; and understaffing prevented these basic measures from being carried out. Jentz fell repeatedly.
In her worst fall, in October 2021, she got out of bed after no one answered her call, made it to the bathroom, and fell on the way back, fracturing her humerus, pubic ramus, and ischium. She also developed pressure ulcers attributed to failures to reposition her and keep her skin clean, and evidence showed inadequate food and water, with no one assisting her to eat after she lost the use of her arm.
The jury found elder neglect under the Elder Abuse Act and negligence, awarded $2,342,800 in total (including $1,837,032 in noneconomic damages and $53,150 in statutory damages for 132 violations of Health & Safety Code section 1430(b)), and found the facility acted with malice, oppression, or fraud for punitive-damages purposes—but critically, the jury found no recklessness, oppression, fraud, or malice for purposes of the Elder Abuse Act’s heightened remedies under Welfare & Institutions Code section 15657.
The trial court granted the defendants’ post-trial motions, reducing noneconomic damages to MICRA’s $250,000 cap (the pre-2023 figure, because the action was filed in 2022) and reducing economic damages to $69,812.19, the amounts Medicare and Medi-Cal actually paid.
The Holding
The Court of Appeals reversed the MICRA reduction. Applying Holland, the court concluded that Jentz’s negligence and elder abuse causes of action “arose out of Country Villa Wilshire’s acts and omissions as Jentz’s custodian and caregiver, not as her health care provider.”
The failure to assist her from bed to bathroom, the unanswered call lights, the absence of supervision and alarms, the failure to reposition and clean her, and the failure to provide adequate food and hydration were all “paradigmatic” custodial failures. Civil Code section 3333.2, therefore, did not limit her recovery, and the full $1,837,032 noneconomic award was reinstated.
The Arguments the Court Rejected—and Why They Matter