Supreme Court of California Justia
Docket No. S121724
People v. Cole

Filed 6/12/06

IN THE SUPREME COURT OF CALIFORNIA

THE PEOPLE,
Plaintiff and Appellant,
S121724
v.
Ct.App.
4/1
D040475
JEFFREY A. COLE et al.,
San
Diego
County
Defendants and Respondents. )
Super. Ct. No. GIC783135

Sections 655 and 2556 of the Business and Professions Code prohibit
certain business and financial relationships between registered dispensing
opticians and licensed optometrists. We granted review in this case to consider
whether the Knox-Keene Health Care Service Plan Act of 1975 (Health & Saf.
Code, § 1340 et seq.1) (Knox-Keene Act) creates an exemption to these
prohibitions when a licensed specialized health care service plan sublets space
within the retail stores of a registered dispensing optician and employs
optometrists to provide professional optometric services to plan subscribers at
those locations. The Court of Appeal held that although the provisions of the
Knox-Keene Act establish an exemption to the rule against the corporate practice
of optometry, they do not affect the statutory prohibitions on the relationships
between registered dispensing opticians and licensed optometrists. On the facts of
1
All further unlabeled statutory references are to the Health and Safety
Code.
1


this case, we agree with the Court of Appeal’s conclusion. We therefore affirm
the Court of Appeal’s judgment.
I. FACTUAL AND PROCEDURAL BACKGROUND

California law authorizes optometrists licensed by the California Board of
Optometry and physicians licensed by the Medical Board of California (Medical
Board) to perform eye examinations and write prescriptions for contacts and
eyeglasses. (See Bus. & Prof. Code, §§ 2003, 2050, 3010.1, 3041, 3041.2, 3042,
3055.) After receiving a prescription, a consumer may get the prescription filled
not only by optometrists and physicians who sell eyewear as part of their practice,
but also by registered dispensing opticians (RDO’s), i.e., dispensing opticians
registered with the Division of Licensing of the Medical Board. (See Bus. & Prof.
Code, §§ 2543, 2550, 2553, 3041, 3042.)
California law contains restrictions on the relationships that licensed
optometrists and physicians may have with others involved in providing optical
services, including RDO’s. At issue here are the restrictions contained in Business
and Professions Code sections 655 and 2556. The former prohibits: (1) licensed
optometrists from having “any membership, proprietary interest, coownership,
landlord-tenant relationship, or any profit-sharing arrangement in any form,
directly or indirectly,” with an RDO or “with any person who is engaged in the
manufacture, sale, or distribution to physicians and surgeons, optometrists, or
dispensing opticians of lenses, frames, optical supplies, optometric appliances or
devices or kindred products;” and (2) RDO’s from having any such arrangement
with a licensed optometrist. (Bus. & Prof. Code, § 655, subds. (a), (b), (c).) “Any
violation of this section constitutes a misdemeanor as to” the licensed optometrist
involved in the violation “and as to any and all persons . . . who participate with”
the optometrist “in [the] violation.” (Bus. & Prof. Code, § 655.) Business and
Professions Code section 2556, as here relevant, makes it “unlawful” for RDO’s
“to advertise the furnishing of, or to furnish, the services of . . . an optometrist,” or
2


“to directly or indirectly employ or maintain on or near the premises used for
optical dispensing, . . . an optometrist.” “Any person who violates” this section “is
guilty of a misdemeanor.” (Bus. & Prof. Code, § 2558.) Courts have described
the “basic aim” of these statutes as being “the elimination of the chance of
dominion of the professional decisions of the practitioner by commercial
interest.”2 (Drucker v. State Bd. of Med. Examiners (1956) 143 Cal.App.2d 702,
712.)
California law also restricts the relationships that optometrists may have
with corporations. In general, under California’s long-standing “policy . . . against
[the] corporate practice of the learned professions,” for-profit corporations “may
not engage in the practice of . . . medicine.” (People v. Pacific Health Corp.
(1938) 12 Cal.2d 156, 158-159 (Pacific Health).) The ban on the corporate
practice of medicine generally precludes for-profit corporations—other than
licensed medical corporations—from providing medical care through either
salaried employees or independent contractors. (Ibid.; Conrad v. Medical Bd. of
California (1996) 48 Cal.App.4th 1038, 1047-1048 [discussing exceptions].) It
has been held applicable with respect to optometrists. (California Assn. of
Dispensing Opticians v. Pearle Vision Center, Inc. (1983) 143 Cal.App.3d 419,
427 (CADO).) Courts have said that the ban on the corporate practice of medicine
“is intended to ameliorate ‘the evils of divided loyalty and impaired confidence’
which are thought to be created when a corporation solicits medical business from
2
Defendants claim “there is strong evidence” that the commonly cited
justification for Business and Professions Code sections 655 and 2556 “is a
pretense, and that the statutes were really interest-group legislation designed to
prevent competition with private optometrists who profit by selling eyewear to
their patients.” Defendants state that this issue was raised below in a counterclaim
that was dismissed, and is separately being litigated by other parties in federal
court. However, in this court, defendants do not pursue this claim and “assume[]
arguendo that the statutes’ stated justification is true.” We express no view on the
issue.
3
the general public and turns it over to a special group of doctors, who are thus
under lay control.” (Conrad v. Medical Bd. of California, supra, 48 Cal.App.4th
at pp. 1042-1043.)
Defendant Pearle, Inc., operates optical stores across the country where, in
a single location, consumers may obtain not only frames and contact lenses, but
also eye examinations and other treatment from licensed optometrists. In the late
1970’s and early 1980’s, Pearle Vision Centers, Inc., which was the operating
subsidiary of Pearle, Inc.’s corporate predecessor, attempted to bring this business
model to California, by selling franchises to optometrists licensed in California.
The California Association of Dispensing Opticians sued Pearle Vision Centers,
Inc., arguing that its franchise program violated California law. The superior court
issued both a temporary restraining order and preliminary injunction prohibiting
Pearle Vision Centers, Inc., from offering franchises to optometrists in California.
(CADO, supra, 143 Cal.App.3d at pp. 422-423.) In 1983, a Court of Appeal
upheld the superior court’s order, finding in part that by virtue of the control
Pearle Vision Centers, Inc., retained under the franchise agreement, it was
engaging in the illegal corporate practice of optometry.3 (CADO, supra, 143
Cal.App.3d at pp. 426-428.)
In 1986, with the case against Pearle Vision Centers, Inc., still pending, the
Pearle entities adopted a new strategy for bringing their operations to California;
as defendants here explained in the Court of Appeal, “[i]nstead of franchising its
stores to [licensed] optometrists,” the Pearle entities “divided [their] operations in
California in two, with” defendant Pearle Vision, Inc., “providing the services of
opticians and a separate corporation,” defendant Pearle VisionCare, “employing
optometrists and providing their services under the Knox-Keene Act.” Pearle
3
According to defendants here, “[t]he primary defendants in CADO were
Pearle Vision Centers, Inc. and its parent company, G.D. Searle, Inc. [Citation.]
G.D. Searle later reorganized and sold its Pearle entities to Grand Metropolitan
Corporation, which, in turn, sold them to . . . Cole National Group, Inc. in 1996.”
4
Vision, Inc. (Pearle RDO) is an RDO; as such, it provides eyeglasses, contacts,
and related fitting services using prescriptions written by licensed optometrists and
ophthalmologists. (Bus. & Prof. Code, § 2550.) Pearle VisionCare (VisionCare)
is a licensed “specialized health care service plan” under the Knox-Keene Act,
which means that it “undertakes to arrange for the provision of health care services
[in a single specialized area] to subscribers or enrollees, or to pay for or to
reimburse any part of the cost for those services, in return for a prepaid or periodic
charge paid by or on behalf of the subscribers or enrollees.” (§ 1345, subd. (f)(1).)
Operating under a license issued by the director of the Department of Managed
Health Care (DMHC) (see §§ 1341, 1349), VisionCare provides, through licensed
optometrists it employs or contracts with, eye examinations to individuals who pay
a set enrollment fee. VisionCare’s optometrists provide these examinations inside
Pearle RDO’s retail stores, in distinct areas set off from the rest of the store, at
some locations by separate doors or internal walls. VisionCare sublets these areas
from Pearle RDO. To perform examinations, VisionCare’s optometrists use
optometric equipment provided by Pearle RDO. Thus, as defendants explained in
the Court of Appeal, “since 1986,” Pearle RDO and VisionCare “have been
operating in California in parallel within the same storefronts,” i.e., “the ‘Pearle
Vision Stores.’ ”
Pearle RDO and VisionCare are sister corporations; they are both wholly
owned subsidiaries of Pearle, Inc. Pearle, Inc.’s sole assets are shares of
VisionCare and Pearle RDO. Thus, Pearle, Inc., through its subsidiaries, operates
retail outlets where customers can get both eye examinations from optometrists—
who are employed by VisionCare—and glasses from an optician—Pearle RDO.
Pearle RDO advertises the availability of eye examinations at its retail optical
stores; some of these advertisements state that eye examinations are performed by
independent doctors of optometry, or that doctors in California are employed by
VisionCare. According to defendants, Pearle RDO and VisionCare adopted this
business “model” in order “to provide consumers with integrated optical services”
5
by offering “optometrists’ services in close proximity to affiliated eyewear stores
operated by” RDO’s.4
In February 2002, the People filed this action against Pearle, Inc., Pearle
RDO, VisionCare, other related entities, and individuals who allegedly had served
as officers and/or directors of these entities. In their first amended complaint, the
People alleged in relevant part: (1) that Pearle RDO had violated Business and
Professions Code section 17500 by disseminating advertisements that were untrue
or misleading in that they implied that Pearle RDO can and does provide
optometric services (including eye examinations) and the services of optometrists,
when in fact Pearle RDO is prohibited by law from providing such services and
maintaining an optometrist on or near its premises; (2) that Pearle RDO had
violated Business and Professions Code section 2556—and, in turn, Business and
Professions Code section 17200, which prohibits unfair competition in the form of
an unlawful business practice—by advertising the furnishing of optometrists and
maintaining optometrists for the purpose of examining and treating eyes on or near
premises used for optical dispensing; and (3) that Pearle RDO’s relationship with
VisionCare “and [VisionCare’s] optometrists” violates Business and Professions
Code section 655 and, in turn, Business and Professions Code section 17200. For
relief, the People requested that the court impose civil penalties for the alleged
violations and permanently enjoin Pearle RDO and VisionCare from
disseminating false or misleading advertising and from violating Business and
Professions Code sections 655 and 2556.
In April 2002, the People moved for a preliminary injunction prohibiting
Pearle RDO from violating Business and Professions Code section 2556 by
advertising the furnishing of optometric services, including eye examinations. In
4
Pearle, Inc., is wholly owned by defendant Cole National Group, Inc.
(CNG). CNG acquired Pearle, Inc., Pearle RDO and VisionCare in 1996. CNG is
wholly owned by defendant Cole National Corporation.
6
opposition, defendants argued that the challenged advertisements were not untrue,
misleading or unlawful, because they specified that all eye examinations are
performed, not by Pearle RDO, but by optometrists employed by VisionCare. In
July 2002, the superior court granted the motion and issued a preliminary
injunction prohibiting Pearle RDO from disseminating advertisements in
California that have “the tendency or capacity to mislead the unwary or trusting
consumer that [Pearle RDO] . . . employs optometrists within the State of
California.” Regarding the latter prohibition, the court added the following
proviso: “[A]ny [Pearle RDO] advertisement . . . which references ‘eye
examination[s],’ ‘exam[s],’ ‘examination[s],’ ‘doctor[s],’ ‘optometrist[s],’ or uses
the image of a doctor is not enjoined if it prominently and, in close proximity to
such word or image, states or displays: ‘[Pearle RDO] does not employ Doctors
of Optometry and does not provide eye exams in California. [VisionCare] . . . , a
licensed vision health care service plan, provides eye exams in California.’ ”
Defendants appealed from the order granting the preliminary injunction,
arguing in part that the Knox-Keene Act “relieves” specialized health care service
plans “of restrictions on employing doctors, optometrists, and other health care
professionals by providing” in section 1395, subdivision (b) (section 1395(b))
“that [plans] licensed under the Knox-Keene Act ‘shall not be deemed to be
engaged in the practice of a profession, and may employ, or contract with, any
professional . . . to deliver services.’ ” The People cross-appealed, arguing that the
preliminary injunction did not go far enough and, under Business and Professions
Code section 2556, should have prohibited all advertising by Pearle RDO that
mentions eye examinations, regardless of the inclusion of a disclaimer stating that
VisionCare, rather than Pearle RDO, provides eye examinations. Regarding
section 1395(b), the People argued that this provision merely establishes an
“exception regarding the corporate practice of optometry” and “does not change
the laws that separate the practice of optometry from dispensing opticians/eyeglass
retailers” or “permit opticians to practice or advertise the practice of optometry.”
7

After the parties completed their briefing, the Second District Court of
Appeal, in a published opinion, addressed related questions in Consumer Cause,
Inc. v. National Vision, Inc. (Cal. App.), which we ordered depublished March 3,
2004, S119959 (Consumer Cause). That case involved an RDO that had set up
optician centers in retail stores and, through a subsidiary licensed as a specialized
health care service plan, had provided the services of licensed optometrists and
ophthalmologists in separate but nearby offices within the retail stores. The Court
of Appeal held that Health and Safety Code section 1395 expressly exempted both
the licensed specialized health care service plan and its parent company, the RDO,
from the restrictions of Business and Professions Code sections 655 and 2556.
The parties in this case, at the Court of Appeal’s request, submitted
additional briefs addressing the relevance of Consumer Cause. After receiving
those briefs and hearing oral argument, the Court of Appeal held that the trial
court had properly enjoined Pearle RDO’s advertising, but had erred in allowing
Pearle RDO to advertise eye examinations with a disclaimer. It thus ordered the
superior court to expand the injunction to prohibit all advertising by Pearle RDO
of optometric services. In so holding, the court expressly disagreed with
Consumer Cause and concluded, based on “the plain language of” the statute, that
section 1395(b) “only . . . provide[s] an exception for Knox-Keene-approved
corporations from the requirement that optometrists may only be employed by
professional corporations.” It “does not,” the court stated, either “expressly or
impliedly . . . create an exemption from the restrictions on relationships between
optometrists/ophthalmologists and opticians/optical retailers provided in Business
and Professions Code sections 655 or 2556.”
We granted the petition for review filed by Pearle RDO and VisionCare,
limiting the issue to whether the Knox-Keene Act “exempt[s] approved providers
under the Act from the limitations that Business and Professions Code sections
655 and 2556 otherwise impose on business and financial relationships between
8
dispensing opticians and optometrists or ophthalmologists.” We simultaneously
ordered that the decision in Consumer Cause not be published.5
DISCUSSION

This case requires us to determine the meaning and interrelationship of
several statutes. “As in any case involving statutory interpretation, our
fundamental task is to determine the Legislature’s intent so as to effectuate the
law’s purpose.” (People v. Murphy (2001) 25 Cal.4th 136, 142.) The rules for
performing this task are well established. We begin by examining the statutory
language, giving it a plain and commonsense meaning. (Ibid.) We do not,
however, consider the statutory language in isolation; rather, we look to the entire
substance of the statutes in order to determine their scope and purposes. (Ibid.)
That is, we construe the words in question in context, keeping in mind the statutes’
nature and obvious purposes. (Ibid.) We must harmonize the various parts of the
enactments by considering them in the context of the statutory framework as a
whole. (Ibid.) If the statutory language is unambiguous, then its plain meaning
controls. If, however, the language supports more than one reasonable
construction, then we may look to extrinsic aids, including the ostensible objects
to be achieved and the legislative history. (In re Young (2004) 32 Cal.4th 900,
906.)
1. The Statutory Language Supports the People’s Interpretation.

As often happens in cases involving statutory interpretation, both sides in
this case argue that the plain meaning of the statutory language supports their
position. The statute the parties focus on is section 1395(b), which provides:
“Plans licensed under this chapter shall not be deemed to be engaged in the
practice of a profession, and may employ, or contract with, any professional
licensed pursuant to Division 2 (commencing with Section 500) of the Business

5
No petition for review was filed in Consumer Cause.
9


and Professions Code to deliver professional services. Employment by or a
contract with a plan as a provider of professional services shall not constitute a
ground for disciplinary action against a health professional licensed pursuant to
Division 2 (commencing with Section 500) of the Business and Professions Code
by a licensing agency regulating a particular health care profession.”
Defendants assert that the “plain language” of this provision “makes it clear
that Knox-Keene plans are exempted from the restrictions found in” Business and
Professions Code sections 655 and 2556.6 They reason as follows: As here
relevant, Business and Professions Code sections 655 and 2556 apply only to
relationships of or with licensed professional optometrists. The first clause of
section 1395(b), by providing that Knox-Keene plans are not “engaged in the
practice of a profession,” establishes that Knox-Keene plans are not licensed
professional optometrists. Because, under the first clause, “a Knox-Keene plan
itself is not a professional,” it is “not subject to . . . statutory restrictions that apply
to individual professionals,” including Business and Professions Code sections
655 or 2556. The second clause of section 1395(b) “reinforces” this conclusion by
“grant[ing] Knox-Keene plans the authority to employ or contract with ‘any
professional licensed pursuant to Division 2 [of the Business and Professions
Code],’ i.e., both optometrists and RDO’s.” This clause “unconditional[ly]
authoriz[es]” Knox-Keene plans “to employ or contract with ‘any’ health care
professional” and “specifically permit[s]” them “to establish various employment
and contractual relationships with both optometrists and RDO’s,” notwithstanding
Business and Professions Code sections 655 and 2556. Finally, the second
sentence of section 1395(b), in providing that “[e]mployment by or a contract with
a plan as a provider of professional services shall not constitute a ground for
disciplinary action against a [licensed] health professional,” establishes that
6
Like defendants, for convenience, we will use the term Knox-Keene plan to
refer to a health care service plan licensed under the Knox-Keene Act.
10
“professionals may contract with plans” and that “neither an optometrist nor an
RDO who is employed by or contracts with a Knox-Keene plan is in violation of
Business and Professions Code [section] 655 or [section] 2556.”
According to defendants, “[t]he net effect of these plainly written
provisions” is to “exempt[] the relationships challenged” in this case “from the
limitations on business and financial relationships between RDO’s and
optometrists contained in [Business and Professions Code] sections 655 and
2556.” Taken together, they “specifically negate[] anything in [Business and
Professions Code] sections 655 and 2556 that would make it illegal for an
optometrist to be employed by a plan that contracts with an RDO or optical
company, or for an RDO to contract with a plan that employs optometrists.” As
here relevant, they establish that (1) “a Knox-Keene plan employing an
optometrist may lease space from an optical company because the status of Knox-
Keene plans as non-professionals, reinforced by the right of Knox-Keene plans to
‘contract with’ professionals to provide professional services, renders [Business
and Professions Code section] 655 inapplicable to a lease of space to a Knox-
Keene plan”; and (2) “optometrists and RDO’s who enter into these arrangements
with VisionCare cannot be disciplined under [Business and Professions Code]
sections 655 or 2556 for doing so.”7

7
In a footnote, defendants argue that their interpretation is “confirmed by”
the last paragraph of Business and Professions Code former section 3103,
renumbered as Business and Professions Code section 3109 as of January 1, 2005,
which provides: “Notwithstanding the provisions of this section or the provisions
of any other law, a licensed optometrist may be employed to practice optometry
. . . by a health care service plan pursuant to” the Knox-Keene Act. It appears,
however, that the Legislature added this exemption in 1979 simply to bring the
relevant provision of the Business and Professions Code in line with the
authorization in Health and Safety Code section 1395(b). In describing this
change, one legislative analysis stated: “[Business and Professions Code former]
[s]ection 3103 is [being] amended to include language currently existing in the
Health and Safety Code, sections 1340 through 1395 . . . . No change in law is
taking place.” (Sen. Com. on Business and Professions, analysis of Sen. Bill No.
11



Defendants also make the broader claim that through section 1395(b), “the
Legislature specifically designed the Knox-Keene Act” to make “traditional
corporate practice restrictions inapplicable to Knox-Keene plans.” In place of
these restrictions, defendants assert, the Legislature made Knox-Keene plans
subject to a “comprehensive . . . regulatory scheme . . . designed in substantial part
to address precisely [the same] concern”—“commercial interference with
optometrists’ professional judgment.” According to defendants, Business and
Professions Code sections 655 and 2556 “are precisely the type of ‘corporate
practice restrictions that the Legislature intended to override for health care
service plans.’ ”
Consistent with the Court of Appeal’s holding, the People argue that the
“plain language” of section 1395(b) “create[s] only a narrow employment
exemption and not [the] broad based commercial practice exemption” defendants
assert. According to the People, the first sentence of this provision “is aimed at
[Knox-Keene] plans” and “clarifie[s]” that such plans are “not subject to
prosecution for the unauthorized practice of the healing arts merely because [they]
employ or contract with healing-arts professionals for the delivery of services to
members. Prior to Knox-Keene, this arrangement was unlawful.” The provision’s
second sentence, the People argue, is aimed at “licensed professional providers,”
and simply establishes a complementary exemption for qualifying “ ‘professional
person[s]’ ” from the “historical prohibition” against “working for non-
professionals.” Thus, although the People agree that section 1395(b) both
authorizes Knox-Keene plans to “employ or contract with RDO’s and
optometrists,” and establishes that Knox-Keene plans are not professionals, they
disagree that it “relieve[s]” Knox-Keene plans or their “providers”—here,

461 (1979-1980 Reg. Sess.) as amended Apr. 19, 1979.) Indeed, notwithstanding
their argument, defendants acknowledge that this language was added as part of a
“general ‘clean-up’ bill . . . to ‘correct antiquated language’ and bring the
optometry chapter of the Business [and] Professions Code up to date.”
12


VisionCare’s optometrists—“from any other obligations imposed upon them by
the Business and Professions Code.” Nor do the People agree that section 1395(b)
“relieve[s]” Pearle RDO, “by virtue of [its] association with” VisionCare, “of the
limitations” in Business and Professions Code section 655 “on financial
relationships with optometrists” or “the prohibition” in Business and Professions
Code section 2556 “against advertising the furnishing of optometric
examinations.” In short, the People argue, VisionCare’s “status as a Knox-Keene
plan does not shield [its] providers from their obligations under the Business and
Professions Code.”
In evaluating these conflicting interpretations, it is useful to begin by
examining defendants’ alternative characterizations of Business and Professions
Code section 655 and 2556 as “relationship restrictions,” “commercial-
relationship restrictions,” “commercial-practice restrictions,” or “corporate
practice restrictions.” In a 1982 report to the Legislature, the California
Department of Consumer Affairs (DCA) identified four different types of
“[c]ommercial practice restrictions” relating to optometry: (1) “[p]rohibitions
against the employment of optometrists by commercial corporations”; (2)
“[p]rohibitions against landlord-tenant relationships between optometrists and
opticians”; (3) “[r]estrictions on the number of branch offices an optometrist can
operate”; and (4) “[r]estrictions on the use of trade names.”8 (DCA, Commercial
Practice Restrictions in Optometry (Dec. 1982) Introduction (DCA Report).) In a
1989 rulemaking proceeding, the Federal Trade Commission (FTC) identified
8
The report was submitted pursuant to Business and Professions Code
former section 655.1, which referred to “substantial evidence that the provisions of
[Business and Professions Code] [s]ection 655 may adversely affect vision care
consumers in California,” and required the DCA to submit “findings and
recommendations for legislative action” to the Legislature after “conduct[ing] a
study to determine the impact of commercial practice restrictions in the
ophthalmic industry upon vision care consumers and competition in the
ophthalmic industry.” (Stats. 1982, Ch. 1594, § 1, p. 6299.)
13
these same “types” of “[s]tate restrictions on commercial practice,” although it
characterized the first two as different “forms” of a broader “type” of restriction
on “lay affiliations” with optometrists. (54 Fed. Reg. 10286 (Mar. 13, 1989).)
Thus, it appears that California’s ban on the corporate practice of optometry—i.e.,
employment of optometrists by for-profit corporations—and its restrictions in
Business and Professions Code section 655 and 2556 on the relationships
optometrists may have with RDO’s and manufacturers, are properly characterized
as different types of commercial practice restrictions.
With this understanding in mind, we agree with the People’s reading of the
statutes in question. Defendants’ broad claim that the Legislature enacted Health
and Safety Code section 1395(b) specifically to make restrictions like Business
and Professions Code sections 655 and 2556 inapplicable to Knox-Keene plans
finds little support in the statutory language. As the People observe, the “language
of section 1395(b) mentions only employment and contracting relationships
between [Knox-Keene] plans and providers,” and contains “no mention . . . of
other, broader-based commercial relationship exemptions” and no “reference to
[Business and Professions Code] sections 655 and 2556.” As the People also
observe, the language of Business and Professions Code sections 655 and 2556
“extends well beyond employment and contracting relationships and forbids a
variety of acts, such as profit sharing, proprietary interests and stock ownership.”
Thus, as the People argue, adopting defendants’ broad claim would require us to
find that the Legislature “intend[ed] to create an unstated exemption by
implication to allow plans or their providers to do business outside the parameters
of” other commercial practice restrictions, including Business and Professions
Code section 655 and 2556. Had the Legislature intended section 1395(b) to apply
to all forms of lay affiliations with optometrists, as defendants contend, it would
14
not have used language limited to “employ[ing], or contract[ing] with” licensed
professionals “to deliver professional services.”9 (§ 1395(b).)
In this regard, section 1395(b) stands in marked contrast to the immediately
preceding subdivision, section 1395, subdivision (a), which provides that Knox-
Keene plans may advertise “[n]otwithstanding Article 6 (commencing with
Section 650) of Chapter 1 of Division 2 of the Business and Professions Code.”
Had the Legislature intended to create the broad exemption defendants posit, it no
doubt would have included similar language in section 1395(b). That the
Legislature did not include such language suggests it did not intend to establish a
broad exemption rendering inapplicable any provision of the Business and
Professions Code that could be classified as a “corporate practice” or
“relationship” restriction. It is unlikely the Legislature would have established
such a far-reaching exemption without being more specific about the particular
restrictions being overridden, especially given the specificity of the language it
used in subdivision (a) of section 1395.
Defendants’ broad claim is also inconsistent with other provisions of the
Knox-Keene Act. As noted above, among the types of commercial practice
restrictions are restrictions on using trade names and having branch offices. In
separate provisions of the Knox-Keene Act, the Legislature has specified that
California’s statutory restrictions on using trade names remain applicable to
“specialized health care service plans” like VisionCare (§ 1366, subd. (b)), and
that the restrictions in “the Business and Professions Code” on the number of
branch offices remain applicable to licensed “professional[s] . . . who [are]
employed by, or under contract to, a plan.” (§ 1395, subd. (d).) In still another

9
As amicus curiae California Medical Association (CMA) observes, the
language the Legislature used in section 1395(b) closely tracks the language of
decisional law on the corporate practice of medicine that existed when the
Legislature passed the Knox-Keene Act. (E.g., Pacific Health, supra, 12 Cal.2d at
p. 158 [corporations may neither “employ[]” doctors “on a salary basis” nor
“engage[]” them as “independent contractors”].)
15


provision, the Legislature has specified that “[e]xcept as specifically provided in
[the Knox-Keene Act], nothing in [the Knox-Keene Act] shall be construed to
limit the effect of the laws governing professional corporations, as they appear in
applicable provisions of the Business and Professions Code, upon specialized
health care service plans.” (§ 1395, subd. (f), italics added.) These provisions
belie defendants’ claim that the Legislature “designed the Knox-Keene Act to
render [all] corporate practice prohibitions inapplicable” either to Knox-Keene
plans—especially specialized Knox-Keene plans like VisionCare—or to licensed
professionals performing professional services for those plans.10
Finally, defendants’ broad claim is inconsistent with the provisions of the
Business and Professions Code. The article of that code containing Business and
Professions Code section 655 also contains provisions that prohibit specified
licensed health care professionals from: (1) making referrals for certain services if
they have “a financial interest with the person or in the entity that receives the
referral” (Bus. & Prof. Code, § 650.01, subd. (a)); (2) billing for “clinical
laboratory service[s] not actually rendered by” them “or under” their “direct
supervision,” without identifying the laboratory actually performing the service
(Id., § 655.5, subd. (a)); (3) “employ[ing]” licensed hearing aid dispensers “for the
purpose of fitting or selling hearing aids” (Id., § 655.2); and (4) billing for certain
“cytologic services . . . not actually rendered by” them “or under” their “direct
supervision.” (Id., § 655.6, subd. (a).) As to each of these prohibitions, the
10
That the Legislature addressed the various types of commercial practice
restrictions in these separate provisions of the Knox-Keene Act also further
undermines defendants’ view that although section 1395(b), on its face, addresses
only one type of restriction—the prohibition against corporations employing or
contracting with licensed professionals—it nevertheless addresses a different type
of restriction, i.e., the prohibition against optometrists having landlord-tenant
relationships with RDO’s.
16
Legislature has enacted an express, but limited, exception that applies under
certain circumstances where a Knox-Keene plan is involved.11
These express exceptions are significant for several reasons. First, as
amicus curiae CMA notes, they show that “where the Legislature want[s] to
exempt health plans from” commercial restrictions in the Business and Professions
Code, “it clearly knows how to do so.” The absence of similar provisions
establishing express exceptions to Business and Professions Code sections 655 and
2556 makes defendants’ broad interpretation less plausible. Second, the existence
of these express exceptions is inconsistent with defendants’ view that section
1395(b) renders, or was intended to render, all commercial practice restrictions in
the Business and Professions Code inapplicable where Knox-Keene plans are
involved.12 Were defendants correct, these express exemptions would be

11
See Bus. & Prof. Code, § 650.02, subd. (i) (“prohibition of [Bus. & Prof.
Code, §] 650.01 shall not apply to health care services provided to an enrollee of
a” Knox-Keene plan); id., § 655.5, subd. (e) (“[t]his section shall not apply to any
person . . . who . . . contracts directly with a” Knox-Keene plan “if the services are
to be provided to members of the plan on a prepaid basis and without additional
charge or liability on account thereof”); id., § 655.2 (“[t]his section shall not apply
to any physician and surgeon or medical corporation which contracts with or is
affiliated with a comprehensive group practice” Knox-Keene plan); id., § 655.6,
subd. (d)(1) (section does not apply to “[a]ny person who . . . contracts directly
with a” Knox-Keene plan “if services are to be provided to members of the plan
on a prepaid basis”).
12
Business and Professions Code sections 655.2, 655.6, and 650.02 were
enacted after passage of the Knox-Keene Act. As “expression[s] of legislative
intent in a later enactment,” they are nonbinding “factor[s] that may be
considered” in construing the “earlier enacted statute.” (Cummins, Inc. v. Superior
Court
(2005) 36 Cal.4th 478, 492.) Business and Professions Code section 655.5
was enacted in 1970, before passage of the Knox-Keene Act. It originally referred
to the Knox-Mills Health Plan Act (Gov. Code, former § 12530 et. seq.), which
formerly regulated health plans. (Stats. 1970, ch. 658, § 1, p. 1282.) In 1978, this
reference was replaced with a reference to the Knox-Keene Act. (Stats. 1978, ch.
1161, § 18, p. 3592.)
17


superfluous. The rules of statutory construction direct us to avoid, if possible,
interpretations that render a part of a statute surplusage. (See Fontana Unified
School Dist. v. Burman (1988) 45 Cal.3d 208, 221; Stafford v. Realty Bond Service
Corp. (1952) 39 Cal.2d 797, 805.) Finally, it is significant that the Legislature, in
expressly establishing Knox-Keene exceptions to commercial practice restrictions
appearing in the same article of the code as Business and Professions Code section
655, made those exceptions limited. These express exceptions apply only to
licensed professionals affiliated with “a comprehensive group practice” Knox-
Keene plan (Bus. & Prof. Code, § 655.2), or only to health care services “provided
to an enrollee of a” Knox-Keene plan (id., § 650.02, subd. (i)) or to a “member[]
of [a] plan on a prepaid basis” (id., §§ 655.5, subd. (e), 655.6, subd. (d)(1)). That
the Legislature carefully limited the Knox-Keene exemptions it expressly
established casts substantial doubt on defendants’ broad claim that, through
section 1395(b), the Legislature implicitly established (or intended to establish) an
unlimited exception that renders the commercial relationship restrictions in
Business and Professions Code section 655 (or Business and Professions Code
section 2556) wholly inapplicable when Knox-Keene plans are involved.
Indeed, the express exemptions discussed above highlight a practical
problem with defendants’ position: defining the scope of the exemption they
assert. As the People rightly ask, under defendants’ interpretation, “what happens
to practitioners who provide services for both Knox-Keene plan members as well
as the general public?” Does the exemption defendants assert apply to services
such practitioners provide to those who are not members of the Knox-Keene plan,
or is it limited to services provided to plan “enrollee[s]” (Bus. & Prof. Code,
§ 650.02, subd. (i)) or “members”? (Id., §§ 655.5, subd. (e), 655.6, subd. (d)(1).)
Does it apply to optometrists and RDO’s affiliated with any Knox-Keene plan, or
only to those affiliated with “a comprehensive group practice” Knox-Keene plan?
(Id., § 655.2.) May an optometrist and RDO employed by a Knox-Keene plan,
18
neither of whom is regulated under the Knox-Keene Act, enter into a separate and
otherwise-prohibited profit-sharing agreement just between the two of them? As
demonstrated by the limitations in the express statutory exemptions discussed
above, these are the kinds of questions the Legislature would address in
establishing a Knox-Keene exception to Business and Professions Code sections
655 or 2556. Defendants appear to argue that Business and Professions Code
sections 655 and 2556 are wholly inapplicable to Knox-Keene plans and
professionals who contract with or are employed by Knox-Keene plans. However,
given the limitations on the express exceptions the Legislature has enacted, we
have no basis to accept defendants’ view that the Legislature implicitly
established, or intended to establish, an unlimited exception. Nor have we any
basis for determining which of the possible limitations the Legislature would have
chosen.
Defendants argue that insofar as these express exceptions relate to statutory
restrictions that were “first enacted . . . after passage of the Knox-Keene Act” (see
fn. 12, ante) they have “no bearing” on the issue here. “Under such
circumstances,” they contend, “it is not at all surprising that the statute would
specifically address the new statute’s relationship with the Knox-Keene Act.” By
contrast, defendants assert, because Business and Professions Code sections 655
and 2556 were enacted before the Knox-Keene Act, there is “no reason to expect”
they would include language “addressing the effect of the Knox-Keene Act.”
Defendants’ argument is suspect in light of several legislative actions in
1979. In 1975, when the Knox-Keene Act was passed, Business and Professions
Code former section 3103 (renumbered as Business and Professions Code section
3109 as of January 1, 2005), declared it to be “unprofessional conduct” for a
licensed optometrist to “accept[] employment to practice optometry from . . . any
company or corporation.” (Stats. 1974, ch. 874, § 2, p. 1867.) In 1979, the
Legislature amended this statute to include a Knox-Keene exception, by providing
that “[n]otwithstanding the provisions of this section or the provisions of any other
19
law, a licensed optometrist may be employed to practice optometry . . . by a health
care service plan pursuant to” the Knox-Keene Act. (Stats. 1979, ch. 788, § 6, p.
2687.) According to one legislative analysis, the purpose of this amendment was
to “conform[]” Business and Professions Code former section 3103 “to language
currently existing in” the Knox-Keene Act, and “to remove inconsistencies
between certain statutory . . . provisions regarding . . . employment of
optometrists.” (Assem. Subcom. on Health Personnel, analysis of Sen. Bill No.
461(1979-1980 Reg. Sess.), as amended June 20, 1979.)
The same year, the Legislature also amended both Business and Professions
Code sections 655 and 2556, but those amendments did not include language
referencing the Knox-Keene Act. (Stats. 1979, ch. 975, § 1, p. 3339; Stats. 1979,
ch. 653, § 9, p. 2012-2013.) The 1979 amendment to Business and Professions
Code section 655 significantly strengthened that section’s prohibitions by (1)
deleting an exception for optometrists and RDO’s who do not refer patients and
customers to each other, and (2) adding subsection (b) to make explicit that the
statute not only prohibits optometrists from having proprietary relationships with
RDO’s, it likewise prohibits RDO’s from having proprietary relationships with
optometrists. (Stats. 1979, ch. 975, § 1, p. 3339.) Notably, the legislative history
of the amendment contains no mention of the Knox-Keene Act, and no suggestion
that Business and Professions Code section 655 is inapplicable where optometrists
and RDO’s are employed by or contract with Knox-Keene plans. On the contrary,
several legislative analyses explained that the revised statute would prohibit any
and all proprietary relationships between optometrists and RDO’s. (Legis.
Analyst, analysis of Assem. Bill No. 1125 (1979-1980 Reg. Sess.) as amended
June 8, 1979; Sen. Democratic Caucus, analysis of Assem. Bill No. 1125 (1979-
1980 Reg. Sess.) as amended Sept. 5, 1979; Sen. Republican Caucus, analysis of
Assem. Bill No. 1125 (1979-1980 Reg. Sess.) as amended Sept. 5, 1979; Dept. of
Finance, Enrolled Bill Rep. on Assem. Bill No. 1125 (1979-1980 Reg. Sess.) Sept.
18, 1979.) Similarly, an opposition letter submitted on behalf of Cole National
20
Corporation argued that the revised statute “would prohibit any form of landlord-
tenant relationship” between RDO’s and optometrists “under any circumstances
whatsoever.” (Donald Brown, Advocation, Inc., letter to Assemblymember Daniel
Boatwright re: Assem. Bill No. 1125 (1979-1980 Reg. Sess.) June 11, 1979, p. 1.)
And, in a letter asking the Governor to veto the passed bill, Stanley Pearle, as
Chairman of Searle Optical Inc., argued that the revised statute would “outlaw[]
any landlord-tenant relationship between an optician and optometrist” and
“exclude[]” opticians “from making available to their customers one-stop
shopping for both optometric services and optical goods.” (Stanley Pearle, letter
to Governor Jerry Brown re: Assem. Bill No. 1125 (1979-1980 Reg. Sess.) Sept.
19, 1979, pp. 1-2.) These events undermine defendants’ assertion that there is “no
reason to expect language in [Business and Professions Code] sections 655
addressing the effect of the Knox-Keene Act.”
Defendants also err in asserting that the People’s interpretation, by making
part of section 1395(b) surplusage, violates our rules for construing statutes.
According to defendants, because the second clause of section 1395(b)’s first
sentence expressly authorizes plans to “employ, or contract with, any” licensed
professional, reading the entire sentence as “only” an authorization to hire licensed
professionals gives no effect to the sentence’s first clause, which provides that
“[p]lans licensed under this chapter shall not be deemed to be engaged in the
practice of a profession.” (§ 1395(b).) However, as noted above, the People’s
interpretation gives meaning to the first sentence’s first clause by acknowledging
that it establishes that in providing health care services through licensed
professionals, Knox-Keene plans are not “engaged in the practice of a profession.”
(§ 1395(b).) Under California law, “[t]he practice of optometry is the performing
or the controlling of any of the acts set forth in [Business and Professions Code]
[s]ection 3041.” (Bus. & Prof. Code, § 3070.) Thus, without the first clause of
section 1395(b), a Knox-Keene plan’s provision of optometric services through
hired optometrists, though expressly authorized, would likely constitute the
21
practice of optometry. Under the People’s interpretation, the provision’s first
clause definitively establishes otherwise.13 Thus, the People’s interpretation gives
meaning to that clause, just not the expansive meaning defendants proffer: a broad
exemption from all the otherwise applicable commercial-relationship restrictions
in the Business and Professions Code.
Like their broad claim regarding section 1395(b), defendants’ discussion of
the statute’s specific application in this case suffers several problems. Defendants
are correct, and the People agree, that in light of the first clause of the statute—
Knox-Keene plans “shall not be deemed to be engaged in the practice of a
profession” (Ibid.)—VisionCare itself is not a “person licensed” as an optometrist
within the meaning of Business and Professions Code section 655. However, as
here relevant, Business and Professions Code section 655, subdivisions (a) and (b),
prohibit licensed optometrists from having a “landlord-tenant relationship” with
RDO’s either “directly or indirectly.” Although section 1395(b) would appear to
preclude a finding that Pearle RDO and VisionCare’s optometrists “directly” have
a prohibited “landlord-tenant relationship” within the meaning of Business and
Professions Code section 655, it does not preclude a finding that they “indirectly”
have such a prohibited relationship.14
13
That the Legislature could have decided otherwise is demonstrated by its
enactment, only four years before passing the Knox-Keene Act, of a statute
providing: “The offering and operation by a medical corporation of a health care
service plan . . . shall be the practice of medicine by such corporation, and is
hereby authorized.” (Stats. 1971, ch. 1467, § 1, p. 2897.)
14
This case comes to us upon the trial court’s issuance of a preliminary
injunction regarding advertising, and the trial court has yet to decide whether the
relationship between Pearle RDO and VisionCare’s optometrists violates Business
and Professions Code section 655. Nor has the trial court decided whether Pearle
RDO has violated Business and Professions Code section 2556’s prohibitions
against “furnish[ing] the services of . . . an optometrist” and “directly or indirectly
employ[ing] or maintain[ing]” an optometrist “on or near the premises for optical
dispensing.” We express no view on these questions, which are beyond the scope
of the issue on which we granted review. Because we do not answer these
22

Nothing in section 1395(b) supports defendants’ contrary position. As
defendants acknowledge, that section authorizes Knox-Keene plans “to ‘contract
with’ professionals to provide professional services.” (Italics added; see § 1395(b)
[plans may contract with licensed professionals “to deliver professional
services”].) Similarly, section 1395(b) provides that a licensed professional may
not be disciplined for contracting “as a provider of professional services” with a
plan. Pearle RDO’s rental agreement with VisionCare does not constitute a
contract “to deliver professional services,” and Pearle RDO, as VisionCare’s
landlord, is not acting “as a provider of professional services.”15 (§ 1395(b).)

questions, we also cannot, and do not, address defendants’ argument that because
Business and Professions Code sections 655 and 2556 do not prohibit the
arrangements at issue here, the latter’s prohibition against RDO’s advertising “the
furnishing of” an optometrist’s services “must be read” to allow Pearle RDO to
advertise those arrangements, and that Pearle RDO therefore has not violated that
prohibition.
15
Our discussion assumes that RDO’s, which are “registered” with the
Division of Licensing of the Medical Board (Bus. & Prof. Code, § 2550),
otherwise qualify under Health and Safety Code section 1395(b) as
“professional[s] licensed pursuant to Division 2 (commencing with Section 500)
of the Business and Professions Code.” (Italics added.) As already noted, the
People concede that section 1395(b) authorizes Knox-Keene plans to “employ or
contract with RDO’s.” We also note that the statutory chapter on RDO’s appears
in the division of the Business and Professions Code mentioned in Health and
Safety Code section 1395(b); that Business and Professions Code section 655
refers to persons “licensed” under the provisions relating to RDO’s; and that
Business and Professions Code section 23.7 states that “[u]nless otherwise
expressly provided, ‘license’ means license, certificate, registration, or other
means to engage in a business or profession regulated by this code.”
Our discussion also assumes that, as the People assert, VisionCare does not
provide VisionCare’s subscribers with “eyewear benefits under the plan,” and that
Pearle RDO’s only contractual arrangement with VisionCare is the lease
agreement. Defendants do not contest this assertion. Nor did they oppose the
People’s request for judicial notice of a sample membership contract VisionCare
filed with the DMHC, which indicates that VisionCare’s plan does not cover the
costs of frames, lenses or contacts. Given the facts, we have no occasion to
discuss the application of these statutes where a Knox-Keene plan employs or
contracts with both optometrists and RDO’s to provide professional services.
23


Although section 1395(b) expressly authorizes Knox-Keene plans to employ
licensed optometrists to provide professional services, it does not provide that
optometrists so employed may operate without regard to other professional
restrictions. Moreover, the Knox-Keene Act elsewhere provides that Knox-Keene
plans “shall employ and utilize allied health manpower for the furnishing of
services to the extent permitted by law.” (§ 1367, subd. (f), italics added.) In
short, with respect to Knox-Keene plans, section 1395(b) removes only one
preexisting restriction on health care licensed professionals: the ban on
employment by a corporation other than a medical corporation. Nothing in its
language establishes or suggests that it removes other restrictions on the
relationships such professionals may have, such as the prohibition against
“directly or indirectly” having a landlord-tenant relationship with an RDO. (Bus.
& Prof. Code, § 655.) A licensed professional working for a Knox-Keene plan
who is disciplined for having such a prohibited relationship is not being
disciplined for that employment, but for additionally having a prohibited
relationship.
Defendants’ discussion of Business and Professions Code section 2556
fares no better. Again, defendants are correct that, in light of Health and Safety
Code section 1395(b), VisionCare itself is not an “optometrist” within the meaning
of Business and Professions Code section 2556. However, contrary to defendants
claim, this fact does not establish that Pearle RDO does not “directly or indirectly
employ or maintain on or near the premises for optical dispensing . . . an
optometrist” within the meaning of Business and Professions Code section 2556.
Defendants’ contrary analysis of the statutory language is unpersuasive.
Defendants argue that “the second clause of [section] 1395(b) plainly authorizes
relationships like VisionCare’s,” and that whatever the phrase “indirectly employ
or maintain on or near the premises” means (Bus. & Prof. Code, § 2556), it
“cannot apply to optometric services provided by a Knox-Keene plan, pursuant to
express statutory language allowing the plan to provide such services and
24
exempting it from restrictions applicable to professionals.” Defendants are
incorrect; as explained above, section 1395(b) authorizes Knox-Keene plans to
contract with licensed professionals “to deliver professional services,” not, as
defendants contend, “to lease space in” RDO’s retail optical stores. As a landlord,
Pearle RDO simply is not acting “as a provider of professional services.” (§
1395(b).)
Finally, we reject defendants’ assertion that because Business and
Professions Code sections 655 and 2556 “carry[] misdemeanor penalties,” we
should apply the rule that directs courts to resolve ambiguities in penal statutes in
the defendant’s favor. That rule “ ‘applies only if the court can do no more than
guess what the legislative body intended.’ ” (People v. Avery (2002) 27 Cal.4th
49, 58.) It does not apply “ ‘unless two reasonable interpretations of the same
provision stand in relative equipoise’ ” (ibid.), i.e., that “the defendant’s proposed
interpretation is at least as plausible as that of the People. [Citations.]” (People v.
Hammer (2003) 30 Cal.4th 756, 771, fn. 13.) Because, for the reasons stated
above, defendants’ interpretation is not equally plausible, the rule is inapplicable.16

16
In supporting defendants’ interpretation, amicus curiae California
Association of Health Plans (CAHP) relies in part on a provision defendants do
not mention: section 1395, subdivision (c), which provides that a licensed “health
care service plan . . . may directly own, and may directly operate through its
professional employees or contracted licensed professionals, offices and
subsidiary corporations . . . as are necessary to provide health care services to the
plan’s subscribers and enrollees.” By its terms, that provision does not apply here
because VisionCare, the specialized Knox-Keene plan, does not “directly own”
and “directly operate” Pearle RDO’s retail stores. (§ 1395, subd. (c).) Given this
fact, we express no opinion on the People’s view that the provision is inapplicable
for another reason: because it mentions only “health care service plan[s]” (§ 1395,
subd. (c)), and therefore does not apply to specialized health care service plans
like VisionCare.
25


2. Extrinsic Sources Do Not Support Defendants’ Interpretation.

Although asserting that the plain language of section 1395(b) is dispositive,
defendants also rely heavily on various extrinsic sources. As explained below,
defendants’ discussion of these sources is unpersuasive.
a. Prior Administrative Construction
Defendants assert that “[t]he agencies charged with administering the
Knox-Keene Act have applied [defendants’] understanding of the Act for almost
two decades.” In support of their argument, defendants rely principally on
a petition the Attorney General filed, as counsel for the California Board of
Optometry, with the Federal Trade Commission (FTC) in 1989, and on internal
memoranda of the Medical Board’s Division of Licensing and the Department of
Corporations (DOC), which was originally charged with administering the Knox-
Keene Act.
Defendants’ reliance on these documents is unavailing. How much, if any,
“deference” we give the type of administrative interpretation defendants cite
depends on “a complex of factors material to the substantive legal issue before
[us], the particular agency offering the interpretation, and the comparative weight
the factors ought in reason to command.” (Yamaha Corp. of America v. State Bd.
of Equalization (1998) 19 Cal.4th 1, 12.) Several of the relevant factors indicate
that deference is unwarranted here. First, the FTC petition and the internal agency
memoranda were not “contemporaneous with” enactment of the relevant statutes
(id. at p. 13); they were all prepared years later. Second, none of these documents
discusses the relevant statutory language or reflects “careful consideration” of the
precise issue before us. (Ibid.) Third, the internal memoranda, which are
essentially advice letters prepared by individual staff members, are not entitled to
the deference we afford “ ‘a regulation adopted after public notice and
comment.’ ” (Ibid.) Finally, the issue here is the construction of statutes, and we
generally “are less inclined to defer to an agency’s interpretation of a statute than
26
to its interpretation of a self-promulgated regulation. [Citation.]” (Bonnell v.
Medical Board (2003) 31 Cal.4th 1255, 1265.) Here, we have no reason to believe
the agencies in question have a “ ‘comparative interpretive advantage over the
courts’ ” in interpreting the relevant statutes. (Yamaha, supra, 19 Cal.4th at p. 12.)
For these reasons, the documents defendants cite do not persuade us to adopt
defendants’ interpretation.17
Nor are we persuaded by defendants’ more general assertion that since
1986, “California regulators” have either expressly approved, or failed to object to,
the operation of specialized Knox-Keene vision care plans affiliated with optical
companies that are RDO’s. As the People point out, “no state agency has ever
promulgated a regulation or issued a formal opinion interpreting the [Knox-Keene]
Act to create an exemption to Business and Professions Code sections 655 or
2556.” And, as we stated over 70 years ago in rejecting a similar argument by a
dentist who sought to overturn his suspension for aiding the unlawful corporate
practice of dentistry, “[d]elayed action on the part of those who are charged with
the execution of laws will not be permitted to annul the law. It may be considered
by the court as a reason for the mitigation of punishment, but the judicial
department is not absolutely bound to regard it.”18 (Painless Parker v. Board of
Dental Examiners (1932) 216 Cal. 285, 299 (Painless Parker).) Ultimately, the
17
We also note that, contrary to defendants’ claim, none of the cited
documents states that either the Knox-Keene Act in general or section 1395(b) in
particular makes commercial practice restrictions inapplicable to specialized
Knox-Keene plans. However, in light of the factors discussed above, we need not
detail the reasons why our reading of these documents differs from defendants’.
18
Regarding punishment—imposition of fines and penalties—defendants
state that they have asserted “estoppe[l]” in the trial court, and that the issue “is
not implicated here.”
27
interpretation of a statute is a question of law for the courts to decide.19 (Reno v.
Baird (1998) 18 Cal.4th 640, 660.)
b. Legislative History
Defendants rely in part on the legislative history of the Knox-Keene Act,
which was enacted through passage of Assembly Bill No. 138 (1975-1976 Reg.
Sess.). They cite statements in an Assembly third reading analysis that the Knox-
Keene Act “opens licensure to for-profit organizations which were prohibited
under earlier registration procedure,” and that “regulating performance regardless
of the corporate status is seen as a more logical way to control abuses.” (Assem.
third reading analysis, Assem. Bill No. 138 (1975-1976 Reg. Sess.) as amended
Apr. 17, 1975.)
Contrary to defendants’ assertion, these statements provide little, if any,
support for defendants’ broad interpretation. To the extent they explain that the
Knox-Keene Act permits for-profit corporations to deliver health care services,
these statements are fully consistent with the People’s view that section 1395(b)
simply exempts Knox-Keene plans from the rule that otherwise prohibits for-profit
corporations from employing licensed health care professionals to provide health
care services. The same is true regarding the comment about the benefits of
regulation, viewed in context. The Assembly third reading analysis explained that,
although existing law “prohibited” licensing of “for-profit organizations,” such
entities were “find[ing] their way into the system via subsidiary for-profit
19
We also note that, according to documents submitted by amici curiae
Melvin Snow and Sabrina Hughes, as early as February 2002, the same month the
Attorney General filed this action, the Medical Board rejected several RDO
applications based on its view that Business and Professions Code sections 655
and 2556 preclude an RDO from subleasing space within its retail store to a
specialized Knox-Keene plan so that optometrists employed by the Knox-Keene
plan may provide optometric services to plan members at those locations. Thus,
there is reason to question defendants’ assertion that “[t]he present lawsuit is the
first manifestation . . . of any official objection to the legality of th[e]
arrangements” at issue here.
28
management and supply companies to a nonprofit corporate shell.” (Assem. third
reading analysis, Assem. Bill No. 138 (1975-1976 Reg. Sess.) as amended April
17, 1975.) “Consequently”—i.e., because for-profit entities were finding ways to
avoid existing prohibitions—“regulating performance regardless of the corporate
status [was] seen as a more logical way to control abuses” than prohibiting for-
profit entities from providing health care services. (Ibid.) Again, this discussion
is fully consistent with the People’s view that section 1395(b) simply exempts
Knox-Keene plans from the rule against for-profit corporations employing
licensed health care professionals. It does not indicate a more expansive intent to
eliminate all other restrictions on the relationships that licensed health care
professionals may have.20
Indeed, a complete review of the Knox-Keene Act’s voluminous legislative
history does not support defendants’ broad interpretation of section 1395(b) and
generally supports the People’s more limited reading of that section. The
legislative analyses consistently stressed two key aspects of the Knox-Keene Act:
“a new licensing and [expanded] regulatory structure governing health care service
plans” and a “transfer” of regulatory authority “from the Attorney General to the

20
Defendants also cite the statement at an April 1974 press conference of
former Assemblymember John Knox, who cosponsored the Knox-Keene Act. The
statement, which did not identify the proposed legislation by bill number,
apparently related not to Assembly Bill No. 138, which was introduced in
December 1974, but to Assembly Bill No. 3385 (1973-1974 Reg. Sess.), which
dealt with the same subject and which former Assemblymember Knox introduced
the day before the press conference. There were many similarities between
Assembly Bill No. 3885, as introduced, and Assembly Bill No. 138, but there were
also many differences, including one of particular note here. Section 1395(b), as
proposed in Assembly Bill No. 3885, apparently would have applied only to
licensed plans providing a broad range of “basic health care services,” and not to
“ ‘specialized’ ” plans providing services in “a single specialized area of health
care such as optometry . . . .” (Assem. Bill No. 3885 (1973-1974 Reg. Sess.) as
introduced Apr. 18, 1974, pp. 6-7, 24.) In any event, nothing in cited statement is
inconsistent with the People’s interpretation.
29


Department of Corporations.” (Assem. Com. on Health, analysis of Assem. Bill
No. 138 (1975-1976 Reg. Sess.) as amended Apr. 17, 1975, p. 1.) Some, but not
all, of the analyses also briefly noted, with little or no discussion, that the Knox-
Keene Act would change existing law by allowing for-profit corporations to
operate as licensed health care services plans. (Id. at pp. 7-8; Assem. Off. of
Research, third reading analysis of Assem. Bill No. 138 (1975-1976 Reg. Sess.) as
amended Sept. 2, 1975, pp. 1-2; Assem. Com. on Ways & Means, analysis of
Assem. Bill No. 138 (1975-1976 Reg. Sess.) as amended Apr. 17, 1975, p. 2; Sen.
Com. on Health & Welfare, analysis of Assem. Bill No. 138 (1975-1976 Reg.
Sess.) as amended June 27, 1975, p. 2.) However, nowhere in the limited
discussion of this change is there any mention of an intent to sweep away all other
restrictions on commercial relationships in the Business and Professions Code.
Nor is there any discussion of the pros and cons of maintaining or creating an
exemption from any other relationship restriction. Instead, consistent with the
People’s interpretation, the relevant discussion indicates no more than an intent to
establish an exception to only one such restriction: the prohibition against for-
profit corporations employing licensed health care professionals to provide health
care services. Had the Legislature intended to enact the broad and sweeping
exemption defendants assert, the legislative history would, no doubt, contain some
mention of that intent.
c. Statutory Purpose
Defendants argue that their interpretation is strongly supported by the
purposes of the Knox-Keene Act, specifically, to “preserv[e] the quality of care,”
to “ensur[e] easy access to care,” and to “reduc[e] health care costs through
competition.” Defendants assert that adopting the People’s view “would cause
serious harm to consumers, without any offsetting benefit.” In making their
argument, defendants rely principally on a 1986 finding by the FTC, based largely
on earlier studies, that because “commercial practice” restrictions “increase
prices” and thus “reduc[e] the frequency with which consumers obtain vision
30
care,” they “decrease the overall quality of care” without “provid[ing] offsetting
quality-related benefits.” (54 Fed. Reg. 10286 (Mar. 13, 1989).) Defendants also
rely on a 1982 finding by the DCA, based on FTC data, that California’s
“commercial practice restrictions [would] cost California consumers $102 million
in 1983.” (DCA Rep., supra, Executive Summary, p. i.) Defendants argue that, in
light of these findings, their interpretation would promote the Knox-Keene Act’s
purposes, whereas the People’s interpretation would defeat those purposes by
“inflict[ing] sharply higher costs, reduced services, and lower-quality care on
California consumers.”
The premise of defendants’ argument—that commercial practice
restrictions increase prices and reduce the overall quality of care by decreasing the
frequency of visits—appears to be open to question. The People, citing several
analyses and scholarly criticisms, challenge not only the findings of the FTC and
the DCA, but also the methodology and objectivity of the earlier studies on which
those findings were based. The People also argue that even were these underlying
studies correct when done, “the almost 30-year old . . . data” from those studies
and the FTC’s finding based on that data “have little relevance to California’s
current vision care market.”
This policy debate was before our Legislature in 1979 when it strengthened
Business and Professions Code section 655 (see pp. 20-21, ante), and again in
1983 and 1985 when it rejected proposals to repeal some or all of the prohibitions
in that section and in Business and Professions Code section 2556. The relevant
legislative history demonstrates that defendants’ corporate predecessors
participated in those proceedings, opposing the 1979 legislation and supporting the
unsuccessful repeal proposals based on the same arguments and studies defendants
31
offer here.21 Thus, defendants are now inviting us to resolve in their favor an old
policy debate based on arguments and studies that have, thus far, failed to move
the Legislature. We decline the invitation. In light of the legislative history and
the contrary studies the People cite—one of which was published in 1995—we
have no basis for concluding that the Legislature agrees with defendants’ view or
that the findings on which defendants rely were accurate when made more than 20
years ago, are accurate now, or are now or ever were applicable to California’s
vision care market.22 Instead, we leave this policy debate with the body to which
it rightly belongs: the Legislature, which has “the ability to gather empirical
evidence, solicit the advice of experts, and hold hearings at which all interested
parties may present evidence and express their views.” (Foley v. Interactive Data
Corp. (1988) 47 Cal.3d 654, 694, fn. 31.)
21
E.g., Donald Brown, Advocation, Inc., letter to Assemblymember Daniel
Boatwright re: Assem. Bill No. 1125 (1979-1980 Reg. Sess.) June 11, 1979, p. 1
[arguing for Cole National Corporation that the strengthened statute would be
“anti-competitive and anti-consumer” and would “caus[e] inconvenience and
potentially higher prices to” consumers]; Stanley Pearle, letter to Governor Jerry
Brown re: Assem. Bill No. 1125 (1979-1980 Reg. Sess.) Sept. 19, 1979, pp. 1-2
[arguing for Searle Optical Inc., that the strengthened statute would “prevent[]
aggressive competition in [California’s] optical business,” would result in “higher
prices for California consumers,” and would “not [be] in the best interest of the
consuming public”]; Assem. Health Com., analysis of Assem. Bill No. 1926
(1983-1984 Reg. Sess.) as amended May 4, 1983, pp. 2-3 [proposed repeal of Bus.
& Prof. Code, §§ 655 and 2556 “was introduced at the request of Pearle Vision
Centers” and was based on DCA and FTC data]; Assem. Health Com., analysis of
Assem. Bill No. 1217 (1985-1986 Reg. Sess.) as amended Mar. 28, 1985, p. 2
[proposed repeal was “sponsor[ed]” by “Pearle Health Services,” which “argue[d]
that restrictions in existing law on vision care services are anti-competitive and
reduce patient access to care”].
22
Nor can we conclude that the FTC findings are, or ever were, valid as to
ophthalmologists, given the FTC’s statement that the regulation it had
promulgated “was never intended to address commercial practices by
ophthalmologists,” and that “there is little evidence concerning” such practices.
(54 Fed. Reg. 10300, fn. 164 (Mar. 13, 1989).) Yet defendants’ interpretation of
section 1395(b) would apply equally to such professionals.
32

Defendants also assert that their interpretation is consistent with another
purpose of the Knox-Keene Act: to “prevent[] commercial influence” on
professional judgment through “comprehensive regulatory oversight rather than by
structural prohibitions on with whom [a Knox-Keene] plan may affiliate.” In
making this argument, defendants first assert that the “corporate practice
restrictions barring for-profit corporations from the health care field [are]
expressly based on concern” that professional judgment may be influenced by
“ ‘the profit motive of the corporation employer,’ ” and that the Legislature
“expressly abolished this bar for Knox-Keene companies, based on the judgment
that in the Knox-Keene context it [is] ‘more logical . . . to control abuses’ by
‘regulating performance’ pursuant to a comprehensive regulatory scheme.”
Defendants then assert that because the “concerns cited as the basis for [Business
and Professions Code sections] 655 and 2556 are almost identical to those which
underlie corporate practice prohibitions,” we should construe Health and Safety
Code section 1395(b) also to abolish the prohibitions in Business and Professions
Code sections 655 and 2556 where Knox-Keene plans are involved. According to
defendants, “[i]n view of [the Knox-Keene Act’s] express focus on protecting
professional independence, no purpose (other than protecting the business interests
of optometrists and reducing the availability of vision care to California
consumers) would be served by applying [Business and Professions Code
sections] 655 and 2556 in the Knox-Keene context.”
We believe that we should leave to the Legislature the decision whether the
justification for exempting Knox-Keene plans from the prohibition against
employing optometrists also warrants an exemption from the prohibitions of
Business and Professions Code sections 655 and 2556. To paraphrase one of our
prior decisions, “[t]he question before us is, of course, one of statutory
construction and we do not decide whether the Legislature in [1975] should have
[established this exemption] or whether it should do so now. That is a public
policy issue properly left to the Legislature. . . . ‘Our holding [must be] based on
33
the [Knox-Keene] Act as it is written, not on a different, perhaps broader, version
that could have been, or still may be, enacted.’ [Citation.] Public policy,
however, is a relevant, albeit secondary, consideration for our decision in the
present case. We are asked in this case to decide whether the Legislature intended
to abolish a well-established legal doctrine that raises significant public policy
considerations. We are not persuaded the Legislature would have silently, or at
best obscurely, decided so important and controversial a public policy matter and
created a significant departure from the existing law.” (In re Christian (1994) 7
Cal.4th 768, 782.)
For similar reasons, we reject defendants’ policy arguments for deferring to
what they claim has been the “accepted [administrative] practice” for “nearly two
decades.” According to defendants, “[i]t is extremely important for [Knox-Keene]
plans to be able to develop their products and plans knowing that there is but a
single set of state law standards they must satisfy, and with the understanding that
actions approved by their designated state regulator—the DMHC—are permissible
and may be undertaken with confidence.” Defendants assert that by now adopting
the People’s interpretation, we would frustrate this need for certainty—and thus
“defeat the purposes of the Knox-Keene Act”—by “rais[ing] the specter of later
intervention by the Attorney General to declare unlawful (and seek penalties for)
activity and structures long approved by the DOC and DMHC.” Defendants also
more broadly assert that adopting the People’s interpretation will “deter
investment in California, by undermining confidence in the stability of the legal
structures under which businesses operate, and contributing to a perception that
California’s legal climate is unfriendly to business and makes this State a risky
place to invest or operate.” These arguments, which are unrelated to the language
of the governing statutes, should be directed to the Legislature. As stated earlier,
we must take the law as it is written, and “[d]elayed action on the part of those
who are charged with [its] execution . . . will not be permitted to annul [it].”
(Painless Parker, supra, 216 Cal. at p. 299.) Thus, we leave it to the Legislature
34
to determine whether defendants’ policy arguments merit modification of the
law.23
DISPOSITION
For the reasons discussed above, we affirm the judgment of the Court of
Appeals and remand the case for further proceedings consistent with this opinion.

CHIN, J.
WE CONCUR:
GEORGE, C.J.
KENNARD, J.
BAXTER, J.
MORENO, J.
CORRIGAN, J.
IKOLA, J. ∗

23
Amici curiae John Knox and CAHP make the related argument that in
passing the Knox-Keene Act, the Legislature divested the Attorney General of
authority to challenge a statutory interpretation that the director of the DMHC
renders in acting on an application for a Knox-Keene license, and of jurisdiction to
bring this action. Because these issue are beyond the scope of the issue on which
we granted review, we decline to address them.

Associate Justice, Court of Appeal, Fourth Appellate District, Division
Three, assigned by the Chief Justice pursuant to article VI, section 6 of the
California Constitution.
35



See last page for addresses and telephone numbers for counsel who argued in Supreme Court.

Name of Opinion People v. Cole
__________________________________________________________________________________

Unpublished Opinion


Original Appeal
Original Proceeding
Review Granted
XXX 113 Cal.Appp.4th 955
Rehearing Granted

__________________________________________________________________________________

Opinion No.

S121724
Date Filed: June 12, 2006
__________________________________________________________________________________

Court:

Superior
County: San Diego
Judge: J. Richard Haden

__________________________________________________________________________________

Attorneys for Appellant:

Bill Lockyer, Attorney General, Manuel M. Medeiros, State Solicitor General, Andrea Lynn Hoch and
James Humes, Chief Assistant Attorney General, Albert Norman Shelden, Acting Assistant Attorney
General, Robert M. Foster, Susan A. Ruff, Linda K. Schneider, Sherry L. Ledakis, Antoinette Cincotta,
Jennifer L. Weck and Diane de Kervor, Deputy Attorneys General, for Plaintiff and Appellant.

Catherine I. Hanson and Astrid G. Meghrigian for California Medical Association as Amicus Curiae on
behalf of Plaintiff and Appellant.

Wilke, Fleury, Hoffelt, Gould & Birney, William A. Gould, Jr., Alan G. Perkins and Megan Lewis for
California Optometric Association as Amicus Curiae on behalf of Plaintiff and Appellant.

Walkup, Melodia, Kelly & Echeverria and Matthew D. Davis for Melvin Snow and Sabrina Hughes as
Amici Curiae on behalf of Plaintiff and Appellant.

Robert E. Moss, Jr., and Stuart Thompson for Vision Services Plan as Amicus Curiae on behalf of Plaintiff
and Appellant.

__________________________________________________________________________________

Attorneys for Respondent:

Jones, Day, Reavis & Pogue, Jones Day, Thomas R. Malcolm, Richard J. Grabowski, Daniel H. Bromberg,
Amar D. Sarwal, Dominick V. Freda and Elwood Lui for Defendants and Respondents.

Timothy J. Murris and Robert Pitofsky as Amici Curiae on behalf of Defendants and Respondents.

Charles D. Conner for National Optometric Association as Amicus Curiae on behalf of Defendants and
Respondents.

John T. Knox as Amicus Curiae on behalf of Defendants and Appellants.


Page 2 – S121724 – counsel continued

Attorneys for Respondent:

K & R Law Group, Peter Roan and James F. Novello for California Association of Health Plans as Amicus
Curiae on behalf of Defendants and Appellants.

Morrison & Foerster, Michael M. Carlson, Lori A. Schechter and Tiffany Cheung for National Association
of Optometrists and Opticians as Amicus Curiae on behalf of Defendants and Appellants.

No appearance for Defendants and Respondents.


Counsel who argued in Supreme Court (not intended for publication with opinion):

Jennifer L. Weck
Deputy Attorney General
110 West A Street, Suite 1100
San Diego, CA 92101
(619) 645-2653

Elwood Lui
Jones Day
555 South Flower Street, Fiftieth Floor
Los Angeles, CA 90071-2300
(213) 489-3939


Opinion Information
Date:Docket Number:
Mon, 06/12/2006S121724

Parties
1Pearle Vision, Inc. (Defendant and Appellant)
Represented by Elwood Lui
Jones Day
555 S. Flower Street, 50th Floor
Los Angeles, CA

2Pearle Vision, Inc. (Defendant and Appellant)
Represented by Thomas R.. Malcolm
Jones Day
3 Park Plaza, Suite 1100
Irvine, CA

3Cole, Jeffrey A. (Defendant and Respondent)
Represented by Richard J. Grabowski
Jones, Day, Reavis & Pogue
3 Park Plaza, Suite 1100
Irvine, CA

4The People (Plaintiff and Appellant)
Represented by Jennifer L. Weck
Office of the Attorney General
110 West "A" Street, Suite 1100
San Diego, CA

5The People (Plaintiff and Appellant)
Represented by Susan Ann Ruff
Office of the Attorney General
110 West "A" Street, Suite 1100
San Diego, CA

6California Medical Association (Amicus curiae)
Represented by Astrid Gloria Meghrigian
California Medical Association
221 Main Street, 5th Floor
San Francisco, CA

7California Optometric Association (Amicus curiae)
attn: Dr. Charles D. Comer
3723 Main Street, P.O. Box F
East Chicago, IN 46312

Represented by William Adolph Gould
Wilke Fleury Hoffelt et al
400 Capitol Mall #2200
Sacramento, CA

8California Optometric Association (Amicus curiae)
attn: Dr. Charles D. Comer
3723 Main Street, P.O. Box F
East Chicago, IN 46312

Represented by Megan Alisha Lewis
Wilke Fleury et al LLP
400 Capitol Mall 22nd Fl
Sacramento, CA

9Vision Service Plan (Amicus curiae)
Represented by Stuart L. Thompson
Vision Service Plan
3333 Quality Drive
Rancho Cordova, CA

10Knox, John T. (Amicus curiae)
11California Association Of Health Plans (Amicus curiae)
Represented by Peter Michael Roan
Konowiecki & Rank, LLP
350 S Grand Avenue, Suite 2100
Los Angeles, CA

12California Association Of Health Plans (Amicus curiae)
Represented by James Francis Novello
K&R Law Group, LLP
400 Capitol Mall, Suite 1460
Sacramento, CA

13National Association Of Optometrists & Opticians (Amicus curiae)
Represented by Lori A. Schechter
Morrison & Foerster, LLP
425 Market Street
San Francisco, CA

14Snow, Melvin Gene (Amicus curiae)
Represented by Matthew D. Davis
Walkup Melodia Kelly Wecht & Schoenberg
650 California Street, 26th Floor
San Francisco, CA

15Hughes, Sabrina (Amicus curiae)
Represented by Matthew D. Davis
Walkup Melodia et al.
650 California Street, 26th Floor
San Francisco, CA

16Muris, Timothy J. (Amicus curiae)
Represented by Timothy Joseph Muris
Attorney at Law
3301 North Fairfax Drive
Arlington, VA

17Pitofsky, Robert (Amicus curiae)
Represented by Timothy Joseph Muris
Attorney at Law
3301 North Fairfax Drive
Arlington, VA

18National Optometric Association (Amicus curiae)
19Deal, Peggy (Defendant and Respondent)
20Gagliotti, Joseph (Defendant and Respondent)
21Holden, Stephen L. (Defendant and Respondent)
22Osgood, Dennis C. (Defendant and Respondent)
23Sherrif, David J. (Defendant and Respondent)
24Stefko, David (Defendant and Respondent)
25Pearl Visioncare, Inc. (Defendant and Appellant)

Disposition
Jun 12 2006Opinion: Affirmed

Dockets
Jan 5 2004Petition for review filed
  counsel for appellants Pearle Vision, Inc.
Jan 6 2004Record requested
 
Jan 26 20042nd record request
  By overnight Service.
Jan 27 2004Received Court of Appeal record
  two doghouses
Mar 3 2004Petition for review granted; issues limited (civil case)
  The issue to be briefed and argued is limited to the following issue: Does the Knox-Keene Health Care Service Plan Act of 1975 (Health & Saf. Code, Section 1340 et seq.) exempt approved providers under the Act from the limitations that Business and Professions Code sections 655 and 2556 otherwise impose on business and financial relationships between dispensing opticians and optometrists or ophthalmologists? Votes: George, C.J., Kennard, Baxter, Werdegar, Chin, Brown, and Moreno, JJ.
Mar 3 2004Letter sent to:
  Counsel re Certification of Interested Entities or Persons.
Mar 17 2004Certification of interested entities or persons filed
  Jones Day counsel of record for Pearle Vision, Inc.
Mar 18 2004Certification of interested entities or persons filed
  In San Diego by appellant {The People}.
Mar 22 2004Request for extension of time filed
  to file appellant Pearle Vision, Inc.'s opening brief on the merits asking to May 17, 2004.
Mar 29 2004Change of contact information filed for:
  Counsel for Appellant {The People}.
Mar 30 2004Extension of time granted
  To May 17, 2004 to file appellants' {Pearle Vision Inc., et al.,} Opening Brief on the Merits.
May 7 2004Request for extension of time filed
  appellants Pearle Vision Inc., et al. asking for a 30-day extension to and including June 16, 2004 to file appellants' opening brief on the merits.
May 11 2004Extension of time granted
  To June 16, 2004 to file Appellants' {Pearle Vision Inc.,} Opening Brief on the Merits.
Jun 16 2004Opening brief on the merits filed
  appellant, PEARLE VISION, INC.
Jun 16 2004Request for judicial notice filed (granted case)
  appellant, PEARLE VISION, INC.
Jun 25 2004Opposition filed
  In San Diego by counsel for plaintiff/appellant {The People} to request for Judicial Notice.
Jun 29 2004Received:
  Appellant's {The People} amended proof of service.
Jul 7 2004Received:
  application for permission to file reply to plaintiffs and appellant's opposition to defendants' and appellants' [Pearle Vision,Inc.] request for judicial notice.
Jul 7 2004Request for extension of time filed
  By counsel for Plaintiff/Appellant {The People} requesting a 31-day extension to August 16, 2004 to file Appellant's Answer Brief on the Merits.
Jul 14 2004Extension of time granted
  To August 16, 2004 to file appellant's answer brief on the merits.
Jul 14 2004Filed:
  Appellants' {Pearle Vision, Inc., et al.,} Reply to Opposition to Request for Judicial Notice.
Aug 10 2004Request for extension of time filed
  Plaintiff/Appellant (The People) requesting to Aug. 31, 2004 to file answer brief on the merits. (recv'd in San Diego)
Aug 17 2004Extension of time granted
  To August 31, 2004 to file Plaintiff/Appellant {The People} Answer Brief on the Merits.
Aug 18 2004Received:
  letter dated August 18, 2004, from counsel for appellant PEARLE VISION
Aug 27 2004Request for extension of time filed
  counsel for appellants Pearle Vision, Inc. et al. request to 9/27/04 to file reply brief on the merits
Aug 30 2004Answer brief on the merits filed
  By Appellant {The People}.
Aug 30 2004Exhibit(s) lodged
  Two volumes in support of Appellant's {The People} answer brief on the merits.
Aug 30 2004Request for judicial notice filed (granted case)
  Appellant {The People}.
Sep 3 2004Extension of time granted
  To September 27, 2004 to file Appellants {Pearle Vision, Inc., et al., } Reply Brief on the Merits.
Sep 27 2004Reply brief filed (case fully briefed)
  appellants, PEARLE VISION, INC.
Sep 27 2004Opposition filed
  appellants, PEARLE VISION, iNC., opposing appellant's (the Peopole's) motion requesting Judicial Notice. submitted concurrent with Reply Brief/Merits.
Oct 7 2004Received:
  Appellant's {The People} application to file reply to opposition to request for judicial notice.
Oct 8 2004Filed:
  Appellant's {The People} reply to Appellants {Pearle Vision Inc.,} opposition to request for judicial notice. Filed w/ perm.
Oct 12 2004Received application to file Amicus Curiae Brief
  California Medical Association in support of plaintiff/appellant The People.
Oct 15 2004Permission to file amicus curiae brief granted
  The California Medical Association in support of Plaintiff/Appellant.
Oct 15 2004Amicus curiae brief filed
  The California Medical Association in support of Plaintiff/Appellant. Answer is due within twenty days.
Oct 26 2004Received application to file Amicus Curiae Brief
  by Former Chairmen of the Federal Trade Commission, Timothy J. Muris and Robert Pitofsky in support of defendants and appellants.
Oct 26 2004Received application to file Amicus Curiae Brief
  National Optometrict Association in support of defendants and appellants.
Oct 26 2004Received application to file Amicus Curiae Brief
  Vision Service Plan in support of plaintiff/appellant The People
Oct 26 2004Received application to file Amicus Curiae Brief
  California Optometric Association in support of plaintiff/appelant The People.
Oct 27 2004Received application to file Amicus Curiae Brief
  Melvin Gene Snow and Sabrina Hughes in support of plaintiff and appellant. Submitted with request for judicial notice and exhibits in support.
Oct 27 2004Received application to file Amicus Curiae Brief
  California Association of Health Plans, supporting appellants Pearle Vision, Inc. & Pearle Visioncare, Inc. appllication & brief under separate covers.
Oct 27 2004Permission to file amicus curiae brief granted
  Vision Service Plan in support of plaintiff/appellant.
Oct 27 2004Amicus curiae brief filed
  Vision Service Plan in support of plaintiff/appellant. Answer is due within twenty days.
Oct 27 2004Permission to file amicus curiae brief granted
  California Optometric Associationin support of plaintiff/appellant.
Oct 27 2004Amicus curiae brief filed
  California Optometric Association in support of plaintiff/appellant. Answer is due within twenty days.
Oct 27 2004Received application to file Amicus Curiae Brief
  John T. Knox in support of appellants Pearle Vision, Inc., & Pearle Visioncare, Inc. Application and brief under same cover.
Oct 27 2004Received application to file Amicus Curiae Brief
  National Association of Optometrists and Opticians in support of appellant Pearle Vision Inc. submitted along with request for judicial notice.
Nov 1 2004Permission to file amicus curiae brief granted
  John T. Knox in support of defendants/appellants.
Nov 1 2004Amicus curiae brief filed
  John T. Knox in support of Defendants/Appellants. Answer is due within twenty days.
Nov 1 2004Permission to file amicus curiae brief granted
  California Association of Health Plans in support of defendants/appellants.
Nov 1 2004Amicus curiae brief filed
  California Association of Health Plans in support of denfendants/appellants. Answer is due within twenty days.
Nov 1 2004Permission to file amicus curiae brief granted
  National Association of Optometrists and Opticians in support of defendants/appellants.
Nov 1 2004Amicus curiae brief filed
  National Association of Optometrists and Opticians in support of denfendants/appellants. Answer is due within twenty days.
Nov 1 2004Request for judicial notice filed (granted case)
  By AC National Association of Optometrists and Opticians.
Nov 2 2004Request for extension of time filed
  defendant/appellant Pearle Vision, Inc., requesting permission to file a consolidated answer to all amicus brief on or before November 23, 2004.
Nov 2 2004Permission to file amicus curiae brief granted
  Melvin Gene Snow and Sabrina Hughes in support of plaintiff/appellant.
Nov 2 2004Amicus curiae brief filed
  Melvin Gene Snow and Sabrina Hughes in support of Plaintiff/appellant. Answer is due within twenty days.
Nov 2 2004Request for judicial notice filed (granted case)
  By AC Melvin Gene Snow and Sabrina Hughes / with one volume of exhibits.
Nov 3 2004Request for extension of time filed
  plaintiff/appellant The People requesting a 22-day extension to and including December 13, 2004 to file the answer to amicus briefs.
Nov 5 2004Received:
  Plaintiff/Appellant's (The People) amended proof of service for application for extension of time.
Nov 8 2004Extension of time granted
  To November 23, 2004 to file defendants/appellants' consolidated answer to amicus briefs.
Nov 8 2004Extension of time granted
  To December 13, 2004 to file plaintiff/appellant's answer to amicus briefs.
Nov 8 2004Permission to file amicus curiae brief granted
  National Optometric Association in support of defendants/appellants.
Nov 8 2004Amicus curiae brief filed
  National Optometric Association in support of defendants/appellants. Answer is due within twenty days.
Nov 8 2004Permission to file amicus curiae brief granted
  Timothy J. Muris and Robert Pitofsky in support of defendants/appellants.
Nov 8 2004Amicus curiae brief filed
  Timothy J. Muris and Robert Pitofsky in support of defendants and appellants. Answer is due within twenty days.
Nov 10 2004Request for extension of time filed
  defendants and appellants requesting a 20-day extension to and including December 13 to file consolidated answer to amicus briefs.
Nov 19 2004Extension of time granted
  To December 13, 2004 to file appellant's consolidated answer to amicus briefs.
Dec 13 2004Received:
  Appellant's {The People} oversized response to AC Briefs.
Dec 13 2004Response to amicus curiae brief filed
  appellant, PEARLE VISION, INC.'s consolidated answer brief to all A.C. briefs.
Dec 13 2004Motion filed (non-AA)
  appellant, PEARLE VISIONCARE, INC. re: Amicus Curiae Brief of Melvin Gene Snow and Sabrina Hughes and (2) re: their motion for judicial notice.
Dec 15 2004Response to amicus curiae brief filed
  By appellant {The People} to AC Briefs. Filed with permission.
Dec 15 2004Request for judicial notice filed (granted case)
  (Supplemental) By appellant {The People}.
Dec 15 2004Exhibit(s) lodged
  1 vol. in support of appellant's {The People} response to AC Briefs.
Dec 20 2004Opposition filed
  by: PEARLE VISION, INC. to appellant's Lodgment of exhibits.
Aug 1 20052nd record request
  the rest of the record in D040475
Aug 3 2005Change of contact information filed for:
  Appellants (Pearle Vision, Inc., et al)
Aug 3 2005Received additional record
 
Feb 3 2006Filed:
  Notice of unavailability for participation in oral argument for May 2006 Elwood Lui, counsel for Pearle Vision, defendant and appellant
Mar 8 2006Case ordered on calendar
  Wednesday, April 5, 2006, at 2:00 p.m., in Los Angeles
Mar 14 2006Justice pro tempore assigned
  Werdegar, J., has recused and is not participating. Raymond J. Ikola, Associate Justice of CA 4/3, assigned justice pro tempore.
Mar 30 2006Request for judicial notice granted
  The Request for Judicial Notice of defendants Pearle Vision, Inc., and Pearle VisionCare, Inc., is granted as to Exhibits 1 and 3-9. It is denied as to Exhibit 2. The People's Requests for Judicial Notice is granted as to Exhibits A-R, W, X, Z, and BB-JJ. It is denied as to Exhibits S, T, U, V, Y, and AA. The Request for Judicial Notice of amicus curiae National Association of Optometrists and Opticians is granted in its entirety. The Request for Judicial Notice amici curiae Melvin Snow and Sabrina Hughes is granted as to Exhibits A, B, and G7-G9. It is denied as to Exhibits C-F, G1-G6, and H. As to Exhibit G10, it is granted insofar as this exhibit includes various versions of proposed legislation, chaptered statutes, legislative analyses, enrolled bill reports to the Governor, letters to the Governor from the legislative author of Senate Bill No. 932 (1969-1970 Reg. Sess.), and a letter from the Attorney General to the Governor regarding Assembly Bill No. 1125 (1979-1980 Reg. Sess.), and is denied insofar as this exhibit includes letters regarding these bills from private individuals or organizations to members of the Legislature. The motion of defendants Pearle Vision, Inc., and Pearle VisionCare, Inc., to strike portions of the brief of amici curiae Melvin Snow and Sabrina Hughes is denied.
Apr 5 2006Cause argued and submitted
 
Jun 12 2006Opinion filed: Judgment affirmed in full
  and remand the case for further proceedings consistent with this opinion. Opinion by: Chin, J. Joined by: George, C.J., Kennard, Baxter, Moreno, Corrigan, J.J. Ikola, J. Associate Justice, Court of Appeal, Fourth Appellate District, Division Three, assigned by the Chief Justice pursuant to article VI, section 6 of the California Constitution.
Jul 6 2006Request for publication filed (initial case entry)
  Partial publication after Opinion has been issued. Attorney General Albert N. Shelden, Senior Assistant Attorney General
Jul 6 2006Case start date (publication request)
  Attorney General Albert N. Shelden, Senior Assistant Attorney General
Jul 10 2006Opposition filed
  Pearle Vision, Inc., Appellate Elwood Lui, Counsel
Jul 10 2006Opposition filed
  National Association of Optometrists and Opticians, Inc., Amicus Curiea Michael M. Carlson, Counsel
Aug 23 2006Publication request denied (case closed)
  The request for an order directing partial-republication of the court of appeal opinion in the above-entitled appeal is denied. Werdegar, J., was recused and did not participate. Corrigan, J., was absent and did not participate.
Aug 25 2006Remittitur issued (civil case)
 
Sep 5 2006Received:
  Receipt for remittitur CA4 Div. 1

Briefs
Jun 16 2004Opening brief on the merits filed
 
Aug 30 2004Answer brief on the merits filed
 
Sep 27 2004Reply brief filed (case fully briefed)
 
Oct 15 2004Amicus curiae brief filed
 
Oct 27 2004Amicus curiae brief filed
 
Oct 27 2004Amicus curiae brief filed
 
Nov 1 2004Amicus curiae brief filed
 
Nov 1 2004Amicus curiae brief filed
 
Nov 1 2004Amicus curiae brief filed
 
Nov 2 2004Amicus curiae brief filed
 
Nov 8 2004Amicus curiae brief filed
 
Nov 8 2004Amicus curiae brief filed
 
Dec 13 2004Response to amicus curiae brief filed
 
Dec 15 2004Response to amicus curiae brief filed
 
If you'd like to submit a brief document to be included for this opinion, please submit an e-mail to the SCOCAL website