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California nurses board spends $53,000 to prosecute Kathleen Holt

Gave facial peels at home

Kathleen Holt thought she might be needed to work again as the traditional hospital nurse she used to be. The California Board of Registered Nurses had other plans for her.
Kathleen Holt thought she might be needed to work again as the traditional hospital nurse she used to be. The California Board of Registered Nurses had other plans for her.

In early March, as COVID-19 began to spread, Kathleen Holt, 64, thought she might be needed to work again as the traditional hospital nurse she used to be. The California Board of Registered Nurses had other plans for her.

Holt first came to San Diego in the early 2000s, partially on the suggestion of then local attorney Robert Hyde. The two had been friends in Minnesota, where Holt earned her nursing credentials and worked in hospitals and the state’s correctional system for 12 years. Once in San Diego, she worked as the manager of the medical/surgical floor at Sharp Memorial Hospital before being recruited by Thornton Hospital in La Jolla. After seven years, she sought “more of a wellness type” of nursing and found some training for moving forward.

Since 2009, under a cooperative agreement with Dr. Stephen Brody, proprietor of the Infertility and Lifespan Medical Institute in San Diego, Holt’s work has consisted of giving patients, mostly middle-aged women, injections of Botox for shaping facial features and dermal fillers for removing wrinkles.

Attorney Robert Hyde says, “They had 11 attorneys and 3 paralegals working on this matter and spent $53,124.”

At the time Brody brought Holt into his practice, she was finishing a three-year probation for taking with her the email addresses of patients she had treated at a previous doctor’s office. Although she did not realize it at the time, Holt grants that what she did was wrong. “It was a HIPAA violation,” she told me over clam chowder on a rainy day at Swami’s Cafe in La Mesa. (The 1996 federal Health Insurance Portability and Accountability Act forbids compromising people’s privacy and the security of their medical information.) The probation required Holt to jump through several hoops that allowed the Board of Registered Nurses to monitor her activity. Brody, too, was required to sign off monthly on a statement that she was behaving herself. The worst part of the probation was the $8000 fine the board imposed.

In March 2014, Don Continelli, an investigator for the California Department of Consumer Affairs, working on behalf of the Board of Registered Nurses, showed up at Holt’s office to say that someone had filed a complaint against her anonymously. Among other investigative techniques, Continelli staked out Holt’s office and her house. By pressing him during one encounter, she learned that the complainant was Donna McArdle, also a registered nurse, and a woman Holt had been treating for several years.

“I never treated Donna or any other patient at my home,” Holt said. But she did acknowledge that the two women became friends, and that McArdle visited her occasionally at home. There, Holt gave her “facial peels” and sold her a German line of skin care called Sesderma. “Neither of those require prescriptions,” said Holt, “so they are totally legal.”

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They attended acting classes together with an eye toward becoming spokespersons in skin care television commercials.

The women’s formerly close relationship caused Holt to agonize over why McArdle would turn on her. During the times they spent together, Holt said McArdle openly shared the details of struggles she had been through, and Holt empathized. Why, then, did McArdle turn on her? “The only thing I could imagine was that Donna was angry that I never shared with her anything about my probation. I think I was just too embarrassed.”

The investigation into Holt continued, and she felt exasperated that she could not learn what Continelli’s questions were. “Every time I asked, the board would say only that the investigation was ongoing.”

Meanwhile, Continelli retired and was replaced by Michael Polino, also an investigator with the Department of Consumer Affairs. “Polino was even more intrusive. Once, he came and was accosting my clients in the elevator to see what he could learn after they left my office.

“So, after more than two years, in 2016, I sent letters to the governor, my state senator Joel Anderson, assemblywoman Shirley Weber, and the Department of Consumer Affairs. They then put pressure on the board to move the case along.

“I think that made them mad. They still refused to say what the questions were. Then, in 2018, they decided to prosecute me. When we did discovery, that’s when I finally learned the questions. I could hardly believe it. ‘Did I treat patients at my home, and did I store Botox in my house?’”

By then, the board’s investigation had incurred sizable expenses. So they offered her the opportunity to settle out of court. But the deal came with a price. She would have to pay the board’s costs, which ran up over $50,000.

“No thanks,” said Holt, “I’ll see you in court.”

On March 2, 2020, one week after Holt announced she’d fight to keep her license, Administrative Law Judge Mary Agnes Matyszewski brought down her gavel. California Deputy Attorney General Marichella Tahimic argued the board’s case. She elicited from Donna McArdle that Holt had treated her from home, a claim that both the accused and Dr. Brody denied under oath from the witness stand.

“Then, because Donna and I gave the same description of my home,” Holt told me, “the attorney assumed I must have treated her there.”

Holt’s attorney, Natalia Matusik, a former deputy attorney general, questioned Continelli and Polino about what their long investigations turned up. Neither of them cited anything improper, especially not treating patients at home.

On March 9, sitting at the back of the courtroom, I watched Tahimic give very sophisticated closing arguments. She maintained that Holt and Brody never worked out the “standardized procedures” that must be followed by a nurse when she works in the absence of direct supervision by a doctor. She went to a flipchart at the front of the room and drew a two-circle Venn diagram showing what a nurse can do by herself and what only a doctor can do. Express standardized procedures must cover the intersecting area in between.

“If immediate supervision is required to do the many things nurses do, the doctors would never accomplish a thing,” Holt reminded me later.

On the stand, McArdle testified that Dr. Brody never met with her prior to Holt’s treatments, one of the requirements of standardized procedures. But Brody testified that he remembered meeting with McArdle.

Holt agrees with the concept of standardized procedures, she told me, and she asserted adamantly on the witness stand that she and the doctor did establish them when she first came to work at his office. Matusik noted, in the back-and-forth over the issue, that the Board accepted the arrangement Brody and Holt worked out at the beginning of their collaboration.

“Why is it suddenly an issue now?” Holt rhetorically asked me later. “And they suggested I am a menace to society. So they have let me continue to be that menace for more than six and a half years?”

Last, but hardly the least significant, came Tahimic’s argument that Holt was the one to seek out Brody to hire him as her supervising physician, not the other way around. That suggested that Holt was acting as the doctor in charge. “You even pay him,” Tahimic suggested. But Matusik asked Holt on the stand what the payments are for. “I pay him $500 per month to rent the space I use in his office,” said Holt.

On May 7, Judge Matyszewski submitted a 72-page proposal to the Board of Registered Nursing. In it, she declared, “Cause does not exist… to impose discipline on Ms. Holt’s license.” And “in light of the record as a whole, dismissal of the accusation is proper, because public protection does not require that any discipline be imposed.”

The judge’s opinion is not binding on the board, which can either accept it and drop the case or decide to remove Holt’s license anyway. If the latter, however, Holt has the right to appeal in Superior Court, where Judge Matyszewski’s decision would weigh heavily. She said she will do whatever it takes to maintain her license.

“It is hard to believe,” Holt’s friend and first attorney Robert Hyde told me, “that they had 11 attorneys and 3 paralegals working on this matter and spent $53,124.”

In England, Hyde said, a litigant who sues and loses pays the defendant’s legal expenses. “It’s called the English rule. The American rule says each side pays its own expenses. Except when governments are the complainants. Somehow, here, governments have worked it out so that the defendant must pay both sides’ expenses. That’s why attorneys don’t like to take cases defending a client against government lawsuits. But if judges deem the government’s case to be frivolous, they can overrule the right to have its expenses paid.”

In Holt’s case, the board asked for all $53,124 it had spent. Judge Matyszewski awarded them nothing. “That means,” Hyde said, “the California taxpayers paid all of those attorneys’ fees and costs plus the cost of the judge, the court staff, and so on.”

Over the last 15 years, the California Board of Registered Nurses has faced surprising amounts of harsh criticism. In 2009, then Governor Arnold Schwarzenegger fired three of its top leaders, charging the entire board with incompetence. The issue at the time was that the Board was not taking action against serious offenders. More in line with what Holt has experienced, a 2017 “sunset review” gave the board a “negative evaluation of its enforcement program.” The Department of Consumer Affairs had set an 18-month goal for the Board to resolve cases. But between January 1, 2013, and June 30, 2016, 31 out of 40 “investigated consumer complaints” had not been resolved. Of those, 15 took longer than 36 months and 7 of the 15 took longer than 48 months to resolve. Holt’s case took over 6 and a half years.

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Kathleen Holt thought she might be needed to work again as the traditional hospital nurse she used to be. The California Board of Registered Nurses had other plans for her.
Kathleen Holt thought she might be needed to work again as the traditional hospital nurse she used to be. The California Board of Registered Nurses had other plans for her.

In early March, as COVID-19 began to spread, Kathleen Holt, 64, thought she might be needed to work again as the traditional hospital nurse she used to be. The California Board of Registered Nurses had other plans for her.

Holt first came to San Diego in the early 2000s, partially on the suggestion of then local attorney Robert Hyde. The two had been friends in Minnesota, where Holt earned her nursing credentials and worked in hospitals and the state’s correctional system for 12 years. Once in San Diego, she worked as the manager of the medical/surgical floor at Sharp Memorial Hospital before being recruited by Thornton Hospital in La Jolla. After seven years, she sought “more of a wellness type” of nursing and found some training for moving forward.

Since 2009, under a cooperative agreement with Dr. Stephen Brody, proprietor of the Infertility and Lifespan Medical Institute in San Diego, Holt’s work has consisted of giving patients, mostly middle-aged women, injections of Botox for shaping facial features and dermal fillers for removing wrinkles.

Attorney Robert Hyde says, “They had 11 attorneys and 3 paralegals working on this matter and spent $53,124.”

At the time Brody brought Holt into his practice, she was finishing a three-year probation for taking with her the email addresses of patients she had treated at a previous doctor’s office. Although she did not realize it at the time, Holt grants that what she did was wrong. “It was a HIPAA violation,” she told me over clam chowder on a rainy day at Swami’s Cafe in La Mesa. (The 1996 federal Health Insurance Portability and Accountability Act forbids compromising people’s privacy and the security of their medical information.) The probation required Holt to jump through several hoops that allowed the Board of Registered Nurses to monitor her activity. Brody, too, was required to sign off monthly on a statement that she was behaving herself. The worst part of the probation was the $8000 fine the board imposed.

In March 2014, Don Continelli, an investigator for the California Department of Consumer Affairs, working on behalf of the Board of Registered Nurses, showed up at Holt’s office to say that someone had filed a complaint against her anonymously. Among other investigative techniques, Continelli staked out Holt’s office and her house. By pressing him during one encounter, she learned that the complainant was Donna McArdle, also a registered nurse, and a woman Holt had been treating for several years.

“I never treated Donna or any other patient at my home,” Holt said. But she did acknowledge that the two women became friends, and that McArdle visited her occasionally at home. There, Holt gave her “facial peels” and sold her a German line of skin care called Sesderma. “Neither of those require prescriptions,” said Holt, “so they are totally legal.”

Sponsored
Sponsored

They attended acting classes together with an eye toward becoming spokespersons in skin care television commercials.

The women’s formerly close relationship caused Holt to agonize over why McArdle would turn on her. During the times they spent together, Holt said McArdle openly shared the details of struggles she had been through, and Holt empathized. Why, then, did McArdle turn on her? “The only thing I could imagine was that Donna was angry that I never shared with her anything about my probation. I think I was just too embarrassed.”

The investigation into Holt continued, and she felt exasperated that she could not learn what Continelli’s questions were. “Every time I asked, the board would say only that the investigation was ongoing.”

Meanwhile, Continelli retired and was replaced by Michael Polino, also an investigator with the Department of Consumer Affairs. “Polino was even more intrusive. Once, he came and was accosting my clients in the elevator to see what he could learn after they left my office.

“So, after more than two years, in 2016, I sent letters to the governor, my state senator Joel Anderson, assemblywoman Shirley Weber, and the Department of Consumer Affairs. They then put pressure on the board to move the case along.

“I think that made them mad. They still refused to say what the questions were. Then, in 2018, they decided to prosecute me. When we did discovery, that’s when I finally learned the questions. I could hardly believe it. ‘Did I treat patients at my home, and did I store Botox in my house?’”

By then, the board’s investigation had incurred sizable expenses. So they offered her the opportunity to settle out of court. But the deal came with a price. She would have to pay the board’s costs, which ran up over $50,000.

“No thanks,” said Holt, “I’ll see you in court.”

On March 2, 2020, one week after Holt announced she’d fight to keep her license, Administrative Law Judge Mary Agnes Matyszewski brought down her gavel. California Deputy Attorney General Marichella Tahimic argued the board’s case. She elicited from Donna McArdle that Holt had treated her from home, a claim that both the accused and Dr. Brody denied under oath from the witness stand.

“Then, because Donna and I gave the same description of my home,” Holt told me, “the attorney assumed I must have treated her there.”

Holt’s attorney, Natalia Matusik, a former deputy attorney general, questioned Continelli and Polino about what their long investigations turned up. Neither of them cited anything improper, especially not treating patients at home.

On March 9, sitting at the back of the courtroom, I watched Tahimic give very sophisticated closing arguments. She maintained that Holt and Brody never worked out the “standardized procedures” that must be followed by a nurse when she works in the absence of direct supervision by a doctor. She went to a flipchart at the front of the room and drew a two-circle Venn diagram showing what a nurse can do by herself and what only a doctor can do. Express standardized procedures must cover the intersecting area in between.

“If immediate supervision is required to do the many things nurses do, the doctors would never accomplish a thing,” Holt reminded me later.

On the stand, McArdle testified that Dr. Brody never met with her prior to Holt’s treatments, one of the requirements of standardized procedures. But Brody testified that he remembered meeting with McArdle.

Holt agrees with the concept of standardized procedures, she told me, and she asserted adamantly on the witness stand that she and the doctor did establish them when she first came to work at his office. Matusik noted, in the back-and-forth over the issue, that the Board accepted the arrangement Brody and Holt worked out at the beginning of their collaboration.

“Why is it suddenly an issue now?” Holt rhetorically asked me later. “And they suggested I am a menace to society. So they have let me continue to be that menace for more than six and a half years?”

Last, but hardly the least significant, came Tahimic’s argument that Holt was the one to seek out Brody to hire him as her supervising physician, not the other way around. That suggested that Holt was acting as the doctor in charge. “You even pay him,” Tahimic suggested. But Matusik asked Holt on the stand what the payments are for. “I pay him $500 per month to rent the space I use in his office,” said Holt.

On May 7, Judge Matyszewski submitted a 72-page proposal to the Board of Registered Nursing. In it, she declared, “Cause does not exist… to impose discipline on Ms. Holt’s license.” And “in light of the record as a whole, dismissal of the accusation is proper, because public protection does not require that any discipline be imposed.”

The judge’s opinion is not binding on the board, which can either accept it and drop the case or decide to remove Holt’s license anyway. If the latter, however, Holt has the right to appeal in Superior Court, where Judge Matyszewski’s decision would weigh heavily. She said she will do whatever it takes to maintain her license.

“It is hard to believe,” Holt’s friend and first attorney Robert Hyde told me, “that they had 11 attorneys and 3 paralegals working on this matter and spent $53,124.”

In England, Hyde said, a litigant who sues and loses pays the defendant’s legal expenses. “It’s called the English rule. The American rule says each side pays its own expenses. Except when governments are the complainants. Somehow, here, governments have worked it out so that the defendant must pay both sides’ expenses. That’s why attorneys don’t like to take cases defending a client against government lawsuits. But if judges deem the government’s case to be frivolous, they can overrule the right to have its expenses paid.”

In Holt’s case, the board asked for all $53,124 it had spent. Judge Matyszewski awarded them nothing. “That means,” Hyde said, “the California taxpayers paid all of those attorneys’ fees and costs plus the cost of the judge, the court staff, and so on.”

Over the last 15 years, the California Board of Registered Nurses has faced surprising amounts of harsh criticism. In 2009, then Governor Arnold Schwarzenegger fired three of its top leaders, charging the entire board with incompetence. The issue at the time was that the Board was not taking action against serious offenders. More in line with what Holt has experienced, a 2017 “sunset review” gave the board a “negative evaluation of its enforcement program.” The Department of Consumer Affairs had set an 18-month goal for the Board to resolve cases. But between January 1, 2013, and June 30, 2016, 31 out of 40 “investigated consumer complaints” had not been resolved. Of those, 15 took longer than 36 months and 7 of the 15 took longer than 48 months to resolve. Holt’s case took over 6 and a half years.

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