The agreement by which almost all California license discipline or denial cases are settled is called a stipulated settlement. In a stipulated settlement, a licensee or license applicant usually makes admissions of some wrongdoing and agrees to accept an administrative sanction. The stipulated settlement is usually prepared by the attorney for the licensing agency, which is often a deputy attorney general. The stipulated settlement is a proposal sent to the agency head or license board for adoption, which in the case of a board usually means a vote. Although the stipulated settlement is binding upon the licensee or license applicant unless it is rejected, it does not bind the licensing agency unless it is approved.
The language of the stipulated settlement is usually provided by the licensing agency’s disciplinary guidelines, which almost all agencies have. However, certain parts of the stipulated settlement can be negotiated, including what if any admissions will be made, and if so what, the amount of cost recovery to be paid by the licensee, the duration of probation (if probation is included), and what conditions will be required during probation or what tasks are to be performed.
The agency’s attorney, often a deputy attorney general, receives settlement terms from a representative of the agency’s enforcement unit. That representative sets the terms based upon what they believe will be acceptable to the decision making body or agency head. There can sometimes be a range of possible outcomes, and within that range negotiations can take place. If the agency does not adopt the settlement, the decision maker(s) will sometimes indicate what settlement terms would be acceptable. The alternative is to proceed to hearing.
I advise clients who we represent in settlement negotiations to set priorities for what terms are most important to avoid or reduce. For some clients, they might want the shortest possible probation, if probation is the best possible outcome. For other clients, their priority might be reducing the amount of cost recovery, or avoiding making damaging admissions of wrongdoing.
The stipulated settlement should never be viewed as a take-it-or-leave-it proposition. Sometimes the offered settlement is just so painful and punitive that it is preferable to put the case before an administrative law judge. An experienced license law attorney will have a good idea of what a case is worth in settlement, in order to strike the best possible deal.