California Code, Labor Code - LAB § 3709

If, as a result of such action for damages, a judgment is obtained against the employer, any compensation awarded, paid, orsecured by the employer shall be creditedagainst the judgment.  The court shall allow as a first lien against such judgment the amount of compensation paid by the director from the Uninsured Employers Fund pursuant to Section 3716.

Such judgment shall include a reasonable attorney's fee fixed by the court.  The director, as administrator of the Uninsured Employers Fund, shall have a first lien against any proceeds of settlement in such action, before or after judgment, in the amount of compensation paid by the director from the Uninsured Employers Fund pursuant to Section 3716.

No satisfaction of a judgment in such action, in whole or in part, shall be valid as against the director without giving the director notice and a reasonable opportunity to perfect and satisfy his lien.