Kaiser NICU Nurse Lawsuit: The $41.5M Retaliation Verdict

A Los Angeles County jury awarded Maria Gatchalian, a longtime neonatal intensive care nurse, $41.5 million in December 2023 in her Kaiser NICU nurse lawsuit, finding that Kaiser Permanente fired her in retaliation for years of internal patient safety and staffing complaints. A judge later trimmed the punitive portion, Kaiser appealed, and the case closed in December 2024 when the appeal was dismissed and the judgment was recorded as satisfied.¹

Who Maria Gatchalian Is and What She Reported

Gatchalian was hired as a NICU registered nurse at Kaiser Permanente Hospital in Woodland Hills in February 1989 and was promoted to NICU charge nurse in February 2006, a position she held until her termination in June 2019.² Over three decades, she filed many internal “unusual occurrence reports” documenting what she considered serious problems on her unit.

Among the incidents she flagged: in January 2017 she reported that a NICU patient’s father had been bringing a knife into the unit and that her supervisor, Stella Riddell, knew but had not alerted staff. In May 2018 she filed a report after a metal bar and monitor nearly fell onto an infant’s crib. In early 2019 she flagged what she called a potential HIPAA violation involving patient information disclosed to an unauthorized visitor, and in March 2019 she reported that a nurse had failed to feed a critically ill patient as ordered.² She also raised broader concerns that the NICU was not meeting California’s mandatory nurse-to-patient ratios.

According to her complaint, management pushed back. She alleged that Helen Kersey, director of maternal child health at Woodland Hills, told her to stop filing complaints and relayed that the hospital’s chief nurse executive, Valerie McPherson, “did not want too many” unusual occurrence reports being filed.² After the 2017 knife report, Gatchalian said her supervisor began to “routinely harass, micro-manage, retaliate, and intimidate” her.³ She also alleged age discrimination, pointing to a February 2019 meeting in which she said Kersey suggested she should retire; Gatchalian was 63 at the time.

Why Kaiser Said It Fired Her

In April 2019, someone described in court filings as a patient’s family member anonymously photographed Gatchalian sitting in a recliner in the NICU with her bare feet resting on an isolette while she held a newborn.⁴³⁵

The termination itself unfolded oddly. On June 11, 2019, Gatchalian was struck by a transport isolette at work and placed on medical leave. A week later she received an email saying her employment had ended as of June 15. When she asked, HR initially called the notice an error, but on June 27 her union representative told her Kaiser was going through with the firing. A formal termination letter signed by Kersey followed on July 10, 2019.²

What the Jury Decided

Gatchalian filed suit in Los Angeles County Superior Court on April 22, 2021, as Gatchalian v. Kaiser Foundation Hospitals, et al. (Case No. 21STCV15300), naming Kaiser Foundation Hospitals, Kaiser Foundation Health Plan, Inc., and Southern California Permanente Medical Group.² The case went to trial before Judge Maurice Leiter in early December 2023 and ran for 11 days. During trial, Kaiser’s chief nurse executive acknowledged under oath that she was unaware of any other nurse being terminated for a single dress-code or infection-control policy violation.⁵

On December 11, 2023, the jury returned a verdict for Gatchalian totaling $41.5 million:⁴

$2.5 million for past and future lost earnings
$9 million for past and future emotional distress
$30 million in punitive damages

The jury found that Kaiser had acted with fraud, malice, or oppression in retaliating against Gatchalian for her safety complaints, and that the isolette-photo incident was a pretext for a termination driven by her whistleblowing.⁵

How the Punitive Award Was Cut

Kaiser retained Gibson Dunn for post-trial work and moved for judgment notwithstanding the verdict, asking the court to throw the award out entirely. Kaiser’s attorney Julian Poon argued that testimony about a complicated delivery — in which a patient’s request for a C-section was allegedly refused — had improperly swayed the jury, telling the judge, “This is not some roving referendum on the state of healthcare in the United States.”⁵

In a tentative ruling in March 2024, Judge Leiter refused to overturn the verdict, finding “sufficient evidence here for the jury to determine that plaintiff’s termination was pretextual and disproportionate, and that defendants acted with fraud, malice, or oppression.” He did agree that the $30 million punitive award was excessive against $11.5 million in compensatory damages. He gave Gatchalian’s attorneys 21 days to accept a reduction of the punitive damages to $10 million or face a new trial limited to that amount.⁵

How the Appeal Ended

Kaiser filed notices of appeal in late April and early May 2024, and the matter was assigned appellate case number B337930. The appeal never produced a merits decision. On December 18, 2024, Gatchalian filed an acknowledgment of satisfaction of judgment. The next day, the appellate court dismissed the appeal, and by December 23, 2024, the case was marked “Satisfied.”¹

The specific terms — whether Gatchalian accepted the reduced $10 million punitive figure, whether the parties reached a separate settlement, or any other conditions — are not reflected in the public record. What the record does show is that the judgment was paid and the litigation is over.

The California Laws Behind the Claim

Two California statutes framed Gatchalian’s retaliation claims. Health and Safety Code Section 1278.5 prohibits health facilities from retaliating against employees who file reports or participate in investigations concerning the quality of care or conditions at accredited facilities.⁶ Labor Code Section 1102.5, a broader whistleblower statute, bars employers from retaliating against employees who disclose information about suspected violations of law to a government agency.⁷ Gatchalian’s complaint alleged that Kaiser posted notices in the hospital assuring staff they would be protected for reporting unsafe conditions while management was simultaneously discouraging those very reports.²

1
UniCourt. Gatchalian v. Kaiser Foundation Hospitals, et al.
2
Courthouse News Service. Gatchalian v. Kaiser Foundation Hospitals, Complaint for Damages
3
The Sacramento Bee. Nurse Awarded Millions in Wrongful Termination Lawsuit Against Kaiser
4
Courthouse News Service. Kaiser Aims for Mediation to Avoid Nurse’s Retaliation Award
5
Courthouse News Service. Kaiser Pleads to Scrap Nurse’s Retaliation Verdict
6
National Nurses United. Whistleblower Protection Laws for Healthcare Workers
7
California Department of Industrial Relations. California Whistleblower Protections Notice