The California Department of Insurance broke its silence Friday on a lawsuit filed by a former administrative law judge against Insurance Commissioner Ricardo Lara, and in doing so revealed that a second sitting judge within the agency had also lodged misconduct complaints against department attorneys.
The disclosure came as the department pushed back against allegations from Kristin Rosi, who served as an administrative law judge and later chief judge within the department’s Administrative Hearing Bureau. Rosi filed suit in Alameda County Superior Court in late September, claiming she was fired last year in retaliation for 2024 rulings that found Lara and his former special counsel, Lucy Wang, had improperly approved insurance rate hikes.
At issue is Proposition 103, the landmark 1988 ballot measure that governs how insurance rates are set in California. The law requires public hearings whenever an insurer seeks to raise premiums by 7% or more and a member of the public formally objects through the intervenor process. According to Rosi’s complaint, her rulings determined that department officials skipped required hearings, leaned on regulations that hadn’t been properly authorized, and sidestepped transparency rules in settlement agreements.
Rosi further alleges that after she issued those rulings, Lara, Wang and other unnamed department staff pressured her to alter her decisions or rule differently going forward.
The department initially declined to discuss the pending litigation but reversed that stance this week. “While it is our policy to not comment on pending litigation, the egregious nature of these demonstrably false allegations and blatant inaccuracies requires a response,” said department spokesperson Gabriel Sanchez. He added that Lara and his staff “acted properly, legally, and within the decades-old framework of Proposition 103 to protect consumers and ensure accountability.”
In defending the department, Sanchez disclosed that the State Bar had investigated and closed misconduct complaints Rosi filed last year against Wang and three other department attorneys. Those complaints, obtained by CalMatters though not publicly available, detailed accusations that department officials held closed-door meetings that should have included insurers and intervenors alike, among other alleged violations.
Sanchez characterized Rosi’s complaints as a misunderstanding of long-standing procedures under Proposition 103. He shared a July 14 letter from a State Bar investigator confirming the case had been closed. Notably, that letter referenced not only Rosi but also “Hon. Fredric J. Seligman” as having reported allegations of professional misconduct — marking the first public indication that a second judge, identified elsewhere as Karl-Frederic Seligman, had also raised concerns with the State Bar.
Seligman is currently the only administrative law judge listed on the department’s website. He did not respond to a request for comment.
Wendy Musell, the attorney representing Rosi, said her client has appealed the State Bar’s decision to close the complaints and that the matter remains active. “My understanding is the State Bar still has jurisdiction and the matter is still under appeal,” Musell said.
Rosi joined the department as an administrative law judge in 2007 and was elevated to chief judge in 2016. She was placed on administrative leave in January 2025, and her position was listed as vacant by that July. The department formally confirmed her termination in November, according to the lawsuit.
Because Rosi named Lara and Wang in their official capacities as state employees, the California Department of Justice is representing them in the case.
Lara’s second term as insurance commissioner is set to end in January. Wang departed the department in late 2025 and has since taken a position with a law firm that represents insurance companies.
Original source: CalMatters
