Superior Court, State of California
PLEASE READ: DUE TO A CRITICAL SHORTAGE OF SHERIFF’S DEPUTIES AVAILABLE TO SUPPORT AND SECURE COURT FACILITIES, BEGINNING JUNE 13, 2022 AND UNTIL FURTHER NOTICE, NO IN PERSON APPEARANCES ARE PERMITTED IN DEPARTMENT 16. APPEARANCES BY MICROSOFT TEAMS ARE MANDATORY. THE COURT SINCERELY REGRETS THE INCONVENIENCE.
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TROUBLESHOOTING TENTATIVE RULINGS
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|LINE # |CASE # |CASE TITLE |RULING |
|LINE 1 |19CV347669 |NSS Enterprises vs Easy Print Design, Inc. |A judgment creditor may apply to the proper court for an order |
| | |(Order of Exam) |requiring the judgment debtor to appear before the court, or |
| | | |before a court-appointed referee, and furnish information to aid |
| | | |in enforcement of the money judgment. (Code of Civil Procedure, § |
| | | |708.110(a).) Information to aid in enforcement of the judgment may|
| | | |include information concerning future employment prospects. A |
| | | |proper proof of service having been filed on November 14, 2022, |
| | | |all parties are to appear in Department 16 at 9:00 AM via TEAMS. |
| | | |The Court will administer the oath and the examination will take |
| | | |place off line. The parties are to report after the examination |
| | | |has been completed. If there is no appearance by the moving |
| | | |party, the matter will be ordered off calendar. |
|LINE 2 |21CV384873 |Peter Kleidman vs Franklin Elia |See Tentative Ruling. Court will prepare final order. |
| | |et al | |
|LINE 3 |21CV386613 |Kent Taylor vs City of Sunnyvale |See Tentative Ruling. Court will prepare final order. |
| | |et al | |
|LINE 4 |21CV390847 |Kuba Litwin vs Mathew Caldwell |See Tentative Ruling. Court will prepare final order. |
| | |et al | |
|LINE 5 |21CV377836 |Roger Dell vs VOLKSWAGEN GROUP OF AMERICA, INC. |The matter was taken off calendar. |
|LINE 6 |19CV356394 |David Starcks et al vs. FORD MOTOR COMPANY et al |No opposition has been filed; however, no amended NOH or proof of |
| | | |service of notice of date and time of hearing has been filed. |
| | | |Moving party is directed to appear at hearing for setting motion |
| | | |for continued date to permit service of notice with date and time |
| | | |of hearing. If moving party does not appear, the motion will be |
| | | |taken off calendar. |
|LINE 7 |19CV358030 |Weckworth Electric Group, Inc vs Metcalf Builders, Inc |See Tentative Ruling. Defendant Hyatt will submit the final order.|
| | |et al | |
|LINE 8 |21CV383939 |Delfino Birrueta-Cruz vs Normandin’s et al |See Tentative Ruling. Intervenor will submit the final order. |
|LINE 9 |22CV401142 |Heidi Hassan vs Hermes-Microvision, Inc et al |Seeing no opposition, and service appearing proper, Defendant’s |
| | |(Pro Hac Vice) |motion is GRANTED. Defendant will submit the final order. |
|LINE 10 | | | |
|LINE 11 | | | |
|LINE 12 | | | |
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Case Name: Kleidman v. Elia, et al.
Case No.: 21CV384873
According to the allegations of the first amended complaint (“FAC”), plaintiff Peter Kleidman (“Plaintiff”) contends that the settlement agreement in the underlying action, Kleidman v. Shah, et al. (Super. Ct. Santa Clara County, No. 13CV247406) (“underlying action”), signed on March 25, 2015 is not valid because Jonathan Gaskin signed on behalf of nominal defendant Feeva Technology, Inc. (“Feeva”) and Plaintiff asserts that Feeva never authorized Gaskin to sign the 3/25/15 document on Feeva’s behalf. (See FAC, ¶¶ 4-7.) While Plaintiff admits to having signed the agreement, he thereafter revoked his offer before all of the other sixteen parties validly executed the March 25, 2015 document. (See FAC, ¶ 8.)
In the underlying action, on September 12, 2014, Plaintiff moved for an order deeming that Kaufhold Gaskin LLP (“KG”) did not represent Feeva, referencing the insurance policy issued by U.S. Specialty Insurance Company (“USSIC”). (See FAC, ¶ 11.) KG opposed the motion. (See FAC, ¶ 12.) On October 8, 2014, the court denied Plaintiff’s motion. (See FAC, ¶ 13.) Plaintiff appealed the Court’s October 8, 2014 order, resulting in the April 27, 2021 opinion by the Sixth District in Kleidman v. Feeva Technology Inc., case no. H041738. (See FAC, ¶ 14.) The Sixth District affirmed the October 8, 2014 order, “find[ing] no error in the superior court’s conclusion that USSIC had the authority to select KG to defend the action….”
Recognizing that the October 8, 2014 “Order is a final judgment on the merits embracing an affirmative finding of fact that KGGLLP is in fact Feeva’s attorney,” Plaintiff asserts that “Plaintiff’s rights under Rule 3.1590 were violated.” (FAC, ¶ 16.) “Plaintiff did not raise this issue [on appeal] in H041738 because he did not construe the 10/8/14 Order as a final judgment on the merits of any cause of action, but rather as merely the denial of a motion, without prejudice to bringing a plenary action.” (Id.) “Since the trial court did not follow Rule 3.1590 and based on the language of the 10/8/14 Order, the correct interpretation is that the trial court did not render any final judgment on the merits with any preclusive effect, and Plaintiff is not barred from bringing a plenary action to determine whether Feeva authorized KGGLP to be its attorney in Kleidman v. Shah.” (FAC, ¶ 17.)
“Insofar as the 10/18/14 Order is a final judgment on the merits embracing an affirmative finding of fact that KGGLLP is in fact Feeva’s attorney, then the DCA6 Defendants [the Hon. Franklin D. Elia, the Hon. Allison M. Danner, the Hon. Adrienne M. Grover and the Sixth District Court of Appeal (collectively, ‘DCA6 Defendants’)] violated Plaintiff’s due process rights and acted without subject matter jurisdiction.” (FAC, ¶ 18.) “Insofar as the 10/8/14 Order is not a final judgment on the merits, then the DCA6 Defendants impermissibly blindsided Plaintiff by ruling: ‘We find no error in the superior court’s conclusion that USSIC had the authority to select KG to defend the action against Feeva.’” (FAC, ¶ 24.) “DCA6 Defendants’ factual finding – that the trial court found that USSIC had the authority to select KGGLLP to defend Feeva – is a brand new factual finding that blindsided Plaintiff and violated his due process rights.” (Id.)
Plaintiff complains that “[t]he California Supreme Court (‘CSC’) refuses to exercise subject matter jurisdiction when it in fact has such original jurisdiction under California Constitution, Article VI, § 10, CCP Part 3, Title 1.” (FAC, ¶ 44.) Plaintiff contends that because the California Supreme Court exercises jurisdiction “only in cases in which the issues presented are of great public importance and must be resolved promptly,” that this “violates the Fourteenth Amendment… [and] invidiously discriminates against unimportant claims and denies access to the courts.” (FAC, ¶¶ 44-47.)
On July 20, 2022, Plaintiff filed the FAC against the California Supreme Court, the California Court of Appeal, Sixth Appellate District, Hon. Franklin D. Elia (ret.), Hon. Allison M. Danner, Hon. Adrienne M. Grover (collectively, “Judicial Branch Defendants”), Nitin Shah (“Shah”), Estate of Robert Quist (“Quist”), David Becker (“Becker”), Becker Legal Group, LLC (“BLG”), Don Lloyd Cook (“Cook”), EJ Von Schaumburg (“Von Schaumburg”), Michael Maidy (“Maidy”), Timothy Cox (“Cox”), Martin Pichinson (“Pichinson”), Bernie Murphy (“Murphy”), Bridge and Post, Inc. (“BPI”), Sherwood Partners, LLC, Sherwood Management, LLC, FeevT (assignment for the benefit of creditors), Feeva, and Sherwood Partners, Inc., asserting causes of action for:
1) Declaratory relief (against Shah, Quist, Becker, BLG, Cook, Von Schaumburg, Maidy, Cox, Pichinson, Murphy, BPI, Sherwood Partners, LLC, Sherwood Management LLC, FeevT, Feeva and Sherwood Partners, Inc.);
2) Violation of California Constitution, Article VI, § 11 (against all defendants);
3) Violation of Due Process (against all defendants);
4) Violation of Rule 3.1590 and Code of Civil Procedure section 632 (against all defendants);
5) Declaratory relief (against all defendants);
6) Declaratory relief (against all defendants);
7) Violation of Government Code § 68081 (against all defendants);
8) Violation of California Constitution, Article VI, § 14 (against all defendants);
9) Declaratory relief (against all defendants);
10) Violation of US Constitution, Fourteenth Amendment (against California Supreme Court);
11) Violation of California Constitution, Article III, § 3 (against California Supreme Court); and,
12) Violation of US Constituion, Fourteenth Amendment (against California Supreme Court).
The Judicial Branch Defendants demur to the FAC and each of the causes of action of the FAC on the grounds that this Court has no jurisdiction of the subject of the cause of action alleged in the pleading and each of the causes of action alleged against the Judicial Branch Defendants fail to state facts sufficient to constitute a cause of action.
JUDICIAL BRANCH DEFENDANTS’ DEMURRER TO THE FAC
Judicial Branch Defendants’ request for judicial notice
In support of their demurrer, the Judicial Branch Defendants request judicial notice of the following:
• The docket for Kleidman v. Feeva Technology Inc., case no. H041738 (attached as Exhibit A);
• The June 30, 2021 stipulation and order re settlement (attached as Exhibit B); and,
• The unpublished opinion in Kleidman v. Feeva Technology Inc., case no. H041738 (attached as Exhibit C).
These are all proper subjects of judicial notice. (See Evid. Code § 452, subds. (d), (h); see also First American Title Co. v. Mirzaian (2003) 108 Cal.App.4th 956, 961 (taking judicial notice of the court docket in the matter); see also Wertheim, LLC v. Currency Corp. (2021) 70 Cal.App.5th 327, 330, fn. 1 (taking judicial notice of the Second District’s docket); see also in Epic Communications, Inc. v. Richwave Technology, Inc. (2015) 237 Cal.App.4th 1342, 1347, fn. 3 (taking judicial notice of docket and calendar); see also Dziubla v. Piazza (2020) 59 Cal.App.5th 140, 151, fn. 6 (taking judicial notice of stipulation and order “which is proper under Evidence Code section 452, subdivision (d)”); see also Western Mutual Ins. Co. v. Yamamoto (1994) 29 Cal.App.4th 1474, 1485 (taking judicial notice of unpublished opinion in matter involving collateral estoppel issue); see also Singh v. Lipworth (2014) 227 Cal.App.4th 813, 816, fn. 1 (taking judicial notice of unpublished opinion); see also Bui v. Nguyen (2014) 230 Cal.App.4th 1357, 1363, fn. 3 (taking judicial notice of prior unpublished opinion, stating “[j]udicial notice of our prior opinion is appropriate because it ‘help[s] complete the context of this case’”).)
The Judicial Branch Defendants’ request for judicial notice is GRANTED.
The Judicial Branch Defendants are absolutely immune from suit.
The Judicial Branch Defendants argue that each of the FAC’s causes of action against them fail to state facts sufficient to constitute a cause of action because they are absolutely immune from suit. Plaintiff filed an opposition on October 5, 2022, and then filed a second opposition on January 3, 2023. The first opposition does not address absolute judicial immunity whatsoever. The second opposition argues that “the relief that Plaintiff seeks is declaratory relief… [b]ased on Mahler [v. Judicial Council of California (2021) 67 Cal.App.5th 82, 110], there is no judicial immunity for these claims for declaratory relief.” (Pl.’s second opposition to demurrer, p.4:2-7.)
“[J]udicial immunity is long-standing and absolute… [and] bars civil actions against judges for acts performed in the exercise of their judicial functions and it applies to all judicial determinations, including those rendered in excess of the judge's jurisdiction, no matter how erroneous or even malicious or corrupt they may be.” (Howard v. Drapkin (1990) 222 Cal.App.3d 843, 851-852 (also stating that “[t]he judge is immune unless ‘he has acted in the clear absence of all jurisdiction… [b]eyond doubt, the doctrine of ‘civil immunity of the judiciary in the performance of judicial functions is deeply rooted in California law’”); see also Tagliavia v. County of Los Angeles (1980) 112 Cal.App.3d 759, 761 (stating that “[t]he decisions of this state uniformly and consistently grant immunity from civil suit to judges in the exercise of their judicial functions… [and t]hat is true even if the acts are in excess of the jurisdiction of the judge and are alleged to have been done maliciously and corruptly”); see also Frost v. Geernaert (1988) 200 Cal.App.3d 1104, 1107 (stating that “[i]t is well established judges are granted immunity from civil suit in the exercise of their judicial functions… [t]his rule applies even where the judge’s acts are alleged to have been done maliciously and corruptly”); see also Oppenheimer v. Ashburn (1959) 173 Cal.App.2d 624, 630 (stating that “the civil immunity of the judiciary in the performance of judicial functions is deeply rooted in California law”); see also Greene v. Zank (1984) 158 Cal.App.3d 497, 507 (stating that “[a] judge is not deprived of immunity because the action he took was in error, was done maliciously, or was in excess of his authority; rather, a judge will be subject to liability only when he has acted in the clear absence of all jurisdiction”); see also Taliaferro v. County of Contra Costa (1960) 182 Cal.App.2d 587, 592 (stating that “it is well settled that a judge is immune from civil liability for every act performed within the general scope of the official duties entailed by law upon him”); see also Kleidman v. Barash (C.D.Cal. Apr. 21, 2022, No. CV 22-610-DMG (JPRx)) 2022 U.S.Dist. LEXIS 82678, at *6 (stating that “[j]udges are immune from civil suits arising out of the exercise of their judicial functions… [j]udicial immunity shields a judge from suit, not just the assessment of damages”).) Judicial immunity “protect[s] the finality of judgments [and] discourag[es] inappropriate collateral attacks… [and] protect[s] judicial independence by insulating judges from vexatious actions prosecuted by disgruntled litigants.” (Howard, supra, 222 Cal.App.3d at p.852 (also stating that “[w]ith respect to the latter reason, the immunity is necessary in order to have an independent and impartial judiciary… [t]he public is best served when its judicial officers are free from fear of personal consequences for acts performed in their judicial capacity… [i]f judges were personally liable for erroneous decisions, the resulting avalanche of suits, most of them frivolous but vexatious, would provide powerful incentives for judges to avoid rendering decisions likely to provoke such suits… [t]he resulting timidity would be hard to detect or control, and it would manifestly detract from independent and impartial adjudication… [h]is errors may be corrected on appeal, but he should not have to fear that unsatisfied litigants may hound him with litigation charging malice or corruption”); see also Frost, supra, 200 Cal.App.3d at pp.1107-1108 (stating that “[t]he rule is based on ‘a general principle of the highest importance to the proper administration of justice that a judicial officer, in exercising the authority vested in him, shall be free to act upon his own convictions, without apprehension of personal consequence to himself’… [j]udicial immunity is a principle of common law which is necessary for the welfare of the state and the peace and happiness of society”); see also Greene, supra, 158 Cal.App.3d at p.508 (stating that “[t]his immunity ‘is not for the protection or benefit of a malicious or corrupt judge, but for the benefit of the public, whose interest it is that the judges should be at liberty to exercise their functions with independence and without fear of consequences’”).)
In the case cited by Plaintiff, Mahler, supra, certain retired superior court judges who participated in the Temporary Assigned Judges Program (TAJP), challenged recent changes in the program made by the Chief Justice, including limits on the duration of service in the program. (Mahler, supra, 67 Cal.App.5th at p.92.) The Second District first concluded that legislative immunity applied to the promulgation of the revised TAJP, but, that enforcement of the TAJP comes within the bounds of judicial immunity. (See Mahler, supra, 67 Cal.App.5th at pp.101-109.) Citing Justice Network Inc. v. Craighead Cty. (8th Cir. 2019) 931 F.3d 753, the Mahler court stated that “it is generally recognized by the federal courts that judicial immunity, unlike legislative immunity, does not foreclose suit for prospective declaratory relief and in limited circumstances does not foreclose injunctive relief.” (Mahler, supra, 67 Cal.App.5th at p.109, citing Justice Network, supra, 931 F.3d at pp.763-764.) However, as the Justice Network court states: “declaratory relief is limited to prospective declaratory relief.” (Justice Network, supra, 931 F.3d at p.764 (emphasis original) (concluding that plaintiff’s request for declaratory relief was “retrospective” and was thus not entitled to declaratory relief because “declaratory judgment is meant to define the legal rights and obligations of the parties in anticipation of some future conduct, not simply to proclaim liability for a past act… [a] complaint ‘seeking . . . a declaration of past liability’ against a judge instead of ‘future rights’ does not satisfy the definition of ‘declaratory judgment’ and renders declaratory relief unavailable”); see also Canova v. Trustees of Imperial Irrigation Dist. Employee Pension Plan (2007) 150 Cal.App.4th 1487, 1497 (stating that “[d]eclaratory relief operates prospectively to declare future rights, rather than to redress past wrongs”); see also County of San Diego v. State of California (2008) 164 Cal.App.4th 580, 607 (stating same); see also Monterey Coastkeeper v. California Regional Water Quality Control Bd. (2022) 76 Cal.App.5th 1, 13 (stating same).) Here, the FAC proclaims liability against the Judicial Branch Defendants for past acts. (See FAC, ¶¶ 16 (alleging that “Plaintiff’s rights under Rule 3.1590 were violated… Plaintiff was never put on notice that a final judgment on the merits was being rendered”), 18 (alleging that “Defendants violated Plaintiff’s due process rights and acted without subject matter jurisdiction… Defendants affirmed the 10/8/14 Order based on new, purported facts of which Plaintiff had no due notice, and was denied the opportunity to conduct discovery thereon”), 21 (alleging that “Defendants made such illegal, factual findings… the DCA6 Defendants made a factual finding on the interpretation of language in OTDCI Part (2)… DCA6 Defendants raised the following question sua sponte”), 22 (alleging that “the DCA6 Defendants made the factual finding that ‘associate’ with Feeva means to act unilaterally on behalf of Feeva and without communicating with Feeva when Feeva itself has no agents… the DCA6 Defendants violated both due process and Cal. Const. Art. VI, § 11, by denying Plaintiff his due process rights and acting as a court of original jurisdiction”), 23 (alleging that “DCA6 Defendants found that USSIC associated with Feeva… the DCA6 Defendants violated Plaintiff’s right to due process and illegally acted as a court of original jurisdiction”), 24 (alleging “the DCA6 defendants impermissibly blindsided Plaintiff by ruling”), 28 (alleging that “DCA6 Defendants further violated Plaintiff’s due process rights by making arguments against Plaintiff for the first time in their 4/27/21 Opinion, without first affording Plaintiff the opportunity to be heard thereon… DCA6 Defendants blindsided Plaintiff by ruling that Harbor applied to the instant case… DCA6 Defendants blindsided Plaintiff by ruling that the trial court found that Feeva authorized KGGLLP to be its attorney in Kleidman v. Shah”), 30 (alleging that “the DCA6 Defendants violated Plaintiff’s rights to the benefits of Rule 3.1590 and CCP § 632”), 32 (seeking a declaration regarding the 10/8/14 Order and the H041738 opinion), 34 (seeking a declaration regarding application of option to tender defense of claims to insurer such that Feeva never authorized KGGLLP to be is attorney), 36 (alleging that “DCA6 Defendants ruled for the first time in the 4/27/21 Opinion that Harbor was factually on point”), 37 (alleging that “DCA6 Defendants also ruled for the first time in the 4/27/21 Opinion that the trial court found ‘that USSIC had the authority to select KG to defend the action against Feeva”), 39 (alleging that “DCA6 Defendants failed to state their reasons that Harbor applies to the circumstances involved in Kleidman v. Shah”), 40 (alleging that “DCA6 Defendants ruled for the first in the 4/27/21 Opinion that the trial court found ‘that USSIC had the authority to select KG to defend the action against Feeva’… DCA6 Defendants violated Art. VI, § 14, for failure to state their reasons for this ruling”), 42 (alleging that “the DCA6 Defendants have already shown how they desires [sic] the outcome to be”), 45 (alleging that “the DCA6 Defendants acted in excess of their jurisdiction and without subject jurisdiction by purporting to exert original jurisdiction when they only had appellate jurisdiction”).)
As Plaintiff does not otherwise establish the inapplicability of judicial immunity, the case authority demonstrates the application of judicial immunity bars the causes of action of the FAC against the Judicial Branch Defendants for the acts performed in the exercise of their judicial functions. (See Goodman v. Kennedy (1976) 18 Cal.3d 335, 349 (stating that “Plaintiff must show in what manner he can amend his complaint and how that amendment will change the legal effect of his pleading”); see also Cooper v. Leslie Salt Co. (1969) 70 Cal.2d 627, 636 (stating same); see also Ferrick v. Santa Clara University (2014) 231 Cal.App.4th 1337, 1341 (Sixth District, stating same); see also Larson v. UHS of Rancho Springs, Inc. (2014) 230 Cal.App.4th 336, 343 (also stating that “[t]he assertion of an abstract right to amend does not satisfy this burden… [t]he plaintiff must clearly and specifically set forth the ‘applicable substantive law’ and the legal basis for amendment, i.e., the elements of the cause of action and authority for it… [f]urther, the plaintiff must set forth factual allegations that sufficiently state all required elements of that cause of action… [t]he burden of showing that a reasonable possibility exists that amendment can cure the defects remains with the plaintiff; neither the trial court nor this court will rewrite a complaint”).) The Judicial Branch Defendants’ demurrer to each cause of action of the FAC is SUSTAINED without leave to amend.
The causes of action are also barred by res judicata/collateral estoppel
“[T]he doctrine of res judicata gives certain conclusive effect to a former judgment in subsequent litigation involving the same controversy.” (Boeken v. Philip Morris USA, Inc. (2010) 48 Cal.4th 788, 797.) “The doctrine ‘has a double aspect.’” (Id.) “In its primary aspect, commonly known as claim preclusion, it ‘operates as a bar to the maintenance of a second suit between the same parties on the same cause of action.’” (Id.) “‘In its secondary aspect, commonly known as collateral estoppel, ‘[t]he prior judgment … ‘operates’ in a second suit… based on a different cause of action… ‘as an estoppel or conclusive adjudication as to such issues in the second action as were actually litigated and determined in the first action.’” (Id.) “The prerequisite elements for applying the doctrine to either an entire cause of action or one or more issues are the same: (1) A claim or issue raised in the present action is identical to a claim or issue litigated in a prior proceeding; (2) the prior proceeding resulted in a final judgment on the merits; and (3) the party against whom the doctrine is being asserted was a party or in privity with a party to the prior proceeding.” (Id.)
Here, it is clear that the FAC’s causes of action are issues raised and litigated in prior proceedings involving Plaintiff—the FAC explicitly alleges that he disagrees with the October 8, 2014 Order in Kleidman v. Shah, the underlying action, as well as the Sixth District’s April 27, 2021 opinion affirming the October 8, 2014 Order in the underlying action in appellate case H041738. (See FAC, ¶¶ 4, 9, 11-58.) Plaintiff contends that the issue here is not a final judgment on the merits and thus, collateral estoppel does not apply, explaining that “[t]he 10/8/14 Order (FAC, ¶ 13) is not a final judgment on the merits, but is merely an interlocutory denial of a motion.” (Pl.’s second opposition, p.2:27-28.) However, “interlocutory or interim orders are not appealable, but are only ‘reviewable on appeal’ from the final judgment.” (County of San Diego v. Arzaga (2007) 152 Cal.App.4th 1336, 1343-1344; see also Doran v. Magan (1999) 76 Cal.App.4th 1287, 1292-1293 (stating same; also stating that “[i]f no issues in the action remain for further consideration, the decree is final and appealable… [b]ut if further judicial action is required for a final determination of the rights of the parties, the decree is interlocutory”); see also Kleidman v. United States Specialty Ins. Co. (N.D.Cal. Feb. 10, 2015, No. 5:14-cv-05158 HRL) 2015 U.S.Dist. LEXIS 16243, at *9 (stating that plaintiff Kleidman was collaterally estopped from asserting UCL and declaratory relief claims as he “raised the very issues he now seeks to litigate before this court… Judge Lucas, who apparently presided over the matter in the state court, denied that motion… Kleidman has, in fact, appealed Judge Lucas' decision… there is nothing to suggest that her ruling was anything other than a decision on the merits”).) Here, as stated in the Sixth District’s opinion (H041738), Plaintiff appealed the order in which “the superior court[] conclu[ded] that USSIC had the authority to select KG to defend the action against Feeva,” and then affirmed that order concluding as such. Plaintiff’s argument that the October 8, 2014 Order was not a final determination on the merits lacks merit.
Plaintiff litigated the issues of the October 8, 2014 Order. He appealed that Order which was subsequently affirmed by the Sixth District. Plaintiff disputes the Sixth District’s opinion. Plaintiff apparently did not petition the California Supreme Court for review due to his perception that the issues were not important enough to the public, thereby waiving his right for review. Regardless of Plaintiff’s perceived recourse, it is not to file a new complaint with the superior court seeking to reverse the opinion of the appellate court that affirmed the superior court’s order.
In addition to judicial immunity barring the FAC’s causes of action, Plaintiff is also collaterally estopped from pursuing the causes of action. (See Goodman v. Kennedy (1976) 18 Cal.3d 335, 349 (stating that “Plaintiff must show in what manner he can amend his complaint and how that amendment will change the legal effect of his pleading”); see also Cooper v. Leslie Salt Co. (1969) 70 Cal.2d 627, 636 (stating same); see also Ferrick v. Santa Clara University (2014) 231 Cal.App.4th 1337, 1341 (Sixth District, stating same); see also Larson v. UHS of Rancho Springs, Inc. (2014) 230 Cal.App.4th 336, 343 (also stating that “[t]he assertion of an abstract right to amend does not satisfy this burden… [t]he plaintiff must clearly and specifically set forth the ‘applicable substantive law’ and the legal basis for amendment, i.e., the elements of the cause of action and authority for it… [f]urther, the plaintiff must set forth factual allegations that sufficiently state all required elements of that cause of action… [t]he burden of showing that a reasonable possibility exists that amendment can cure the defects remains with the plaintiff; neither the trial court nor this court will rewrite a complaint”).) The Judicial Branch Defendants’ demurrer to each cause of action of the FAC is also SUSTAINED without leave to amend on this separate ground.
The Judicial Branch Defendants’ alleged conduct is protected by the litigation privilege.
The Judicial Branch Defendants assert that their alleged conduct is protected by the litigation privilege. In opposition, Plaintiff asserts that: Civil Code section 47(b) applies only to communicative conduct and the Judicial Branch Defendants fail to identify the communicative conduct at issue; the Judicial Branch Defendants fail to prove that section 47(b) applies to court orders, decisions and rules, and allowing courts and judicial officers to keep their orders and decisions privileged does not further the policies underlying the privilege; and, the Judicial Branch Defendants fail to prove that section 47(b) outweighs Plaintiff’s constitutional rights.
Civil Code section 47, subdivision (b) states that “[a] privileged publication or broadcast is one made… [i]n any… judicial proceeding.” (Civ. Code § 47, subd. (b).)
Several policies underlie the privilege. First, it affords litigants free access to the courts to secure and defend their rights without fear of harassment by later suits. Second, the courts rely on the privilege to prevent the proliferation of lawsuits after the first one is resolved. Third, the privilege facilitates crucial functions of the trier of fact.
The statutory privilege protects attorneys, judges, jurors, witnesses, and other court personnel from liability arising from publications made during a judicial proceeding. (Rosenfeld, Meyer & Susman v. Cohen (1983) 146 Cal.App.3d 200, 231 [194 Cal.Rptr. 180].) Although originally enacted in the context of defamation actions, the privilege now applies to “any communication, whether or not it amounts to a publication [citations], and all torts except malicious prosecution. [Citations.] Further, it applies to any publication required or permitted by law in the course of a judicial proceeding to achieve the objects of the litigation, even though the publication is made outside the courtroom and no function of the court or its officers is involved.”
(Mattco Forge, Inc. v. Arthur Young & Co. (1992) 5 Cal.App.4th 392, 402 (emphasis added); see also Budwin v. American Psychological Assn. (1994) 24 Cal.App.4th 875, 880; see also Silberg v. Anderson (1990) 50 Cal.3d 205, 215 (also stating that “the litigation privilege is held to be absolute in nature”).)
Here, the FAC alleges that the Judicial Branch Defendants violated certain rights and rules by deciding and finalizing its opinion on H041738 (see FAC, ¶ 14), affirming the finding of fact that KGGLLP is in fact Feeva’s attorney (see FAC, ¶¶ 16, 18), “affirm[ing] the 10/8/14 Order based on new, purported facts of which Plaintiff had no due notice, and was denied the opportunity to conduct discovery thereon” (FAC, ¶ 18), “affirm[ing] a final judgment on the merits by re-finding new facts in a manner that is contrary to the facts asserted by the parties in the trial court and contrary to the facts found by the trial court” (FAC, ¶ 19), “mak[ing] brand new factual findings, sua sponte for the first time on appeal, contrary to the facts alleged by the parties and found by the trial court, without affording the parties the due process right to conduct discovery thereon… [and] by making factual findings without affording the due process right to conduct discovery thereon” (FAC, ¶ 20), “ma[king] such illegal, factual findings... making a factual finding on the interpretation of language in OTDCI Part (2)… rais[ing] the following question sua sponte” (FAC, ¶ 21), “ma[king] the factual finding that ‘associate’ with Feeva means to act unilaterally on behalf of Feeva and without communicating with Feeeva when Feeva itself has no agents… [and] denying Plaintiff his due process rights and acting as a court of original jurisdiction” (FAC, ¶ 22), “f[inding] that USSIC associated with Feeva” (FAC, ¶ 23), “ruling… that the trial court found that USSIC had the authority to select KGGLLP to defend Feeva” (FAC, ¶ 24), “impermissibly act[ing] as a court of original jurisdiction… [and] issuing a judgment for the first time on appeal” (FAC, ¶ 25), “making arguments against Plaintiff for the first time in their 4/27/21 Opinion, without first affording Plaintiff the opportunity to be heard thereon… ruling that Harbor applied to the instant case, even though Harbor is not even remotely factually similar… [and] ruling that the trial court found that Feeva authorized KGGLLP to be its attorney in Kleidman v. Shah” (FAC, ¶ 28), “rul[ing] for the first time in the 4/27/21 Opinion that Harbor was factually on point” (FAC, ¶ 36), “rul[ing] for the first time in the 4/27/21 Opinion that the trial court found ‘that USSIC had the authority to select KG to defend the action against Feeva’” (FAC, ¶ 37), “f[inding] that OTDCI Part (2) gave USSIC the right to unilaterally appoint Feeva’s counsel without Feeva previously making an appearance in the action and without even communicating with Feeva… fail[ing] to state their reasons for this ruling… [and] fail[ing] to state their reasons that Harbor applies to the circumstances involved in Kleidman v. Shah” (FAC, ¶ 39), “rul[ing] for the first time in the 4/27/21 Opinion that the trial court found ‘that USSIC had the authority to select KG to defend the action against Feeva’… [and] fail[ing] to state their reasons for this ruling” (FAC, ¶ 40), and “purporting to exert original jurisdiction when they only had appellate jursidction” (FAC, ¶ 45). Here, it is clear that each of these causes of action are premised on communications made in judicial proceedings to achieve the object of the litigation that have direct connection to the action. Plaintiff’s arguments that the Judicial Branch Defendants fail to identify the communicative conduct at issue and fail to prove that section 47(b) applies to court orders, decisions and rules are plainly without merit. Plaintiff’s argument that allowing courts and judicial officers to keep their orders and decisions privileged does not further the policies underlying the privilege is contradicted by the fact that the privilege facilitates crucial functions of the trier of fact and is specifically meant to protect judges from liability arising from publications made during a judicial proceeding. (See Mattco Forge, Inc., supra, 5 Cal.App.4th at p.402.) Plaintiff’s argument that the Judicial Branch Defendants fail to prove that section 47(b) outweighs Plaintiff’s constitutional rights ignores the fact that the litigation privilege is “absolute in nature.” (Id.)
As Plaintiff’s arguments lack merit, the demurrer to each cause of action of the FAC is additionally SUSTAINED without leave to amend on the ground that they are barred by the litigation privilege. (See Goodman v. Kennedy (1976) 18 Cal.3d 335, 349 (stating that “Plaintiff must show in what manner he can amend his complaint and how that amendment will change the legal effect of his pleading”); see also Cooper v. Leslie Salt Co. (1969) 70 Cal.2d 627, 636 (stating same); see also Ferrick v. Santa Clara University (2014) 231 Cal.App.4th 1337, 1341 (Sixth District, stating same); see also Larson v. UHS of Rancho Springs, Inc. (2014) 230 Cal.App.4th 336, 343 (also stating that “[t]he assertion of an abstract right to amend does not satisfy this burden… [t]he plaintiff must clearly and specifically set forth the ‘applicable substantive law’ and the legal basis for amendment, i.e., the elements of the cause of action and authority for it… [f]urther, the plaintiff must set forth factual allegations that sufficiently state all required elements of that cause of action… [t]he burden of showing that a reasonable possibility exists that amendment can cure the defects remains with the plaintiff; neither the trial court nor this court will rewrite a complaint”).)
In light of the above ruling, it is unnecessary to address arguments relating to the official immunity pursuant to Government Code section 821.6.
The Court otherwise lacks jurisdiction for the FAC’s causes of action for declaratory relief, or, alternatively, its declaration is not necessary or proper under all circumstances.
As previously stated, each of the causes of action of the FAC are barred by collateral estoppel/res judicata, absolute judicial immunity, and the litigation privilege. The Judicial Branch Defendants argue, notwithstanding that the action is barred for the aforementioned reasons, this court lacks jurisdiction to any claims for declaratory relief as the Judicial Branch Defendants are not parties to the underlying action, and it is improper and unsupported by any authority to seek declaratory relief from this court that would vacate all previous orders in the underlying action, allowing Plaintiff to relitigate orders which are now final and law of the case. Alternatively, the Judicial Branch Defendants argue that to the extent that Plaintiff’s prayer for declaratory relief can be considered a petition for writ of mandate, a writ is unavailable since Plaintiff had an adequate remedy at law and had his day in court and thus cannot establish that he will suffer immediate and irreparable harm since he appealed the October 8, 2014 order, it was affirmed and did not seek review by the California Supreme Court. Under these circumstances, a declaration or determination is not proper.
Plaintiff, in opposition, acknowledges that he does not assert any cause of action for injunctive relief or seek a writ of mandate to compel performance of a judicial act—he only seeks declaratory relief. (See Pl.’s second opposition, pp.8:27-28, 9:1-11 (stating that “[t]he FAC does not pray for coercive writs, but rather for declaratory relief… Plaintiff seeks only declaratory relief against the Judicial Branch Defendants, not injunctive relief, but rather declaratory relief”).)
Code of Civil Procedure section 1060 provides that “[a]ny person interested under a written instrument… or who desires a declaration of his or her rights or duties with respect to another… may, in cases of actual controversy relating to the legal rights and duties of the respective parties, bring an original action or cross-complaint in the superior court for a declaration of his or her rights and duties in the premises….” (Code Civ. Proc. § 1060.) Section 1061 states that “[t]he court may refuse to exercise the power granted by this chapter in any case where its declaration or determination is not necessary or proper at the time under all the circumstances.” (Code Civ. Proc. § 1061.)
As the Judicial Branch Defendants argue, Plaintiff may not seek a declaration that would attempt to vacate the orders in the underlying action and reverse the Sixth District’s opinion and allow him to relitigate orders that are now final. Here, at issue is the language of the insurance contract and whether such language gave USSIC the right to select KG to defend Feeva. The Sixth District affirmed the trial court’s conclusion that USSIC had such authority to select KG to defend the action. This court does not have the jurisdiction to reverse the appellate court. Even if it did, Plaintiff appealed the order and it became final. The Court agrees that under the circumstances, a further declaration or determination is neither necessary nor proper as a determination has already been made.
For this additional basis, the demurrer to each cause of action for declaratory relief is SUSTAINED without leave to amend.
The Court will prepare the Order.
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Case Name: Kent Taylor v. City of Sunnyvale, et al.
Case No.: 21-CV-386613
Demurrer to the Second Amended Complaint by Defendants City of Sunnyvale and Mary Cayori
Factual and Procedural Background
This case arises from an improper search of a motor vehicle.
According to the second amended complaint (“SAC”), on April 17, 2018, plaintiff Kent Taylor (“Plaintiff”) (self-represented) was shopping at a Safeway store located at 150 East El Camino Real in the City of Sunnyvale (“City”). (See SAC at p. 5.) After Plaintiff completed his shopping and put his bags in his vehicle, he was stopped by Mary Cayori (“Cayori”) from the City’s police department. (Ibid.) She detained Plaintiff to determine if he had placed stolen items in his shopping bags. (Ibid.) Plaintiff responded he had a valid receipt for everything and encouraged the officer to review the store’s video footage to confirm. (Id. at pp. 5-6.)
Following review of the video, Officer Cayori requested permission to search the bags in Plaintiff’s vehicle. (SAC at p. 6.) Plaintiff did not give his consent but the officer searched the vehicle anyway. (Ibid.) Two hours later, the officer completed her search of the vehicle and determined there were no stolen items. (Id. at pp. 6-7.) Plaintiff claimed the search was unreasonable and thereafter requested an internal affairs investigation into the incident. (Id. at p. 7, Ex. A.) According to a report, the City’s Department of Public Safety concluded that Cayori conducted an unreasonable search of Plaintiff’s vehicle during the theft investigation. (Id. at Ex. A.)
On September 10, 2021, Plaintiff filed a judicial council form complaint alleging causes of action for intentional tort, fraud and intentional deceit.
On March 28, 2022, Plaintiff filed a judicial council form first amended complaint (“FAC”) asserting claims for intentional tort and negligent misrepresentation.
On May 20, 2022, defendants City, Cayori, and City’s Department of Public Safety (collectively, “Defendants”) filed a demurrer to the FAC.[1] The motion was set for hearing on September 1, 2022. Prior to the hearing, the court (Hon. Takaichi) posted a tentative ruling sustaining the demurrer with leave to amend. The court sustained the demurrer on grounds that Plaintiff’s FAC did not comply with the Government Claims Act and failed to state a valid claim. Neither party appeared at the hearing to contest the tentative ruling. Thus, the tentative ruling became the final order of the court.
On September 8, 2022, Plaintiff filed the operative SAC alleging claims for what appears to be negligence and intentional tort.
On October 11, 2022, Defendants filed the motion presently before the court, a demurrer to the SAC. Plaintiff filed written opposition. Defendants filed reply papers.
A further case management conference is set for February 7, 2023.
Demurrer to the SAC
Defendants argue the SAC is subject to demurrer on the following grounds: (1) failure to comply with the Government Claims Act; (2) failure to state a claim; and (3) statute of limitations.
Procedural Issues
As a preliminary matter, Defendants argue Plaintiff did not timely serve his opposition to the demurrer. (See Reply at pp. 1-2.) Code of Civil Procedure section 1005, subdivision (b), requires all papers opposing a motion to be filed and served at least nine court days before the hearing. If the court, in its discretion, refuses to consider a late-filed paper, the minutes or order must so indicate. (Cal. Rules of Court, rule 3.1300(d).)
The hearing date for the instant demurrer is January 17, 2023. Thus, Plaintiff was required to file and serve opposition papers no later than January 3, 2023 to be considered timely.[2] While Plaintiff timely filed his opposition on January 3rd, he did not serve his opposition until January 7, 2023, a Saturday and beyond the deadline imposed by statute. Defendants were clearly prejudiced by the untimely service of the opposition as reply papers were due to be filed and served on Monday January 9, 2023. That prejudice is further demonstrated by the fact that service of the opposition was by regular mail and thus Defendants would not likely receive it until after the deadline to submit reply papers. Defendants however gained access to the opposition before the deadline to file and serve reply papers by checking the Court’s Civil Case Portal. (See Reply at p. 2.) As a consequence, Defendants filed and served timely reply papers.
The court notes Plaintiff fails to explain or justify the untimely service of the opposition. Nor is Plaintiff relieved of complying with court rules and procedures by virtue of his self-representation status. (See Burnete v. La Casa Dana Apartments (2007) 148 Cal.App.4th 1262, 1267 [a litigant appearing in propria persona is entitled to the same, but no greater, consideration than other litigants and attorneys]; see also Bistawros v. Greenberg (1987) 189 Cal.App.3d 189, 193 [self-represented party “held to the same restrictive procedural rules as an attorney”].) That said, this court prefers to address cases on the merits whenever possible and thus will consider the merits of the opposition. (See Fox v. Ethicon Endo-Surgery, Inc. (2005) 35 Cal.4th 797, 806 (Fox) [courts have a policy favoring disposition of cases on the merits rather than on procedural grounds].) Plaintiff is admonished to comply with court rules and procedures with respect to future filings.
In addition, Plaintiff filed a declaration in support of his opposition on January 9, 2023. The court however declines to address the declaration as it is untimely filed and served and constitutes extrinsic evidence which cannot be considered in opposition to a demurrer. (See Code Civ. Proc., § 1005, subd. (b); see also Donabedian v. Mercury Ins. Co. (2004) 116 Cal.App.4th 968, 994 [in reviewing the ruling on demurrer, a court cannot consider the substance of declarations].)
Legal Standard
“In reviewing the sufficiency of a complaint against a general demurer, we are guided by long settled rules. ‘We treat the demurrer as admitting all material facts properly pleaded, but not contentions, deductions or conclusions of fact or law. We also consider matters which may be judicially noticed.’ ” (Blank v. Kirwan (1985) 39 Cal.3d 311, 318.) “A demurrer tests only the legal sufficiency of the pleading. It admits the truth of all material factual allegations in the complaint; the question of plaintiff’s ability to prove these allegations, or the possible difficulty in making such proof does not concern the reviewing court.” (Committee on Children’s Television, Inc. v. General Foods Corp. (1983) 35 Cal.3d 197, 213–214.)
“The reviewing court gives the complaint a reasonable interpretation, and treats the demurrer as admitting all material facts properly pleaded. The court does not, however, assume the truth of contentions, deductions or conclusions of law. … [I]t is error for a trial court to sustain a demurrer when the plaintiff has stated a cause of action under any possible legal theory. And it is an abuse of discretion to sustain a demurrer without leave to amend if the plaintiff shows there is a reasonable possibility any defect identified by the defendant can be cured by amendment.” (Gregory v. Albertson’s, Inc. (2002) 104 Cal.App.4th 845, 850.)
Government Claims Act
The Government Claims Act (Gov. Code, § 810 et seq.) applies to actions against public entities and public employees. (County of Los Angeles v. Super. Ct. (2005) 127 Cal.App.4th 1263, 1267.) “Under the Act, no person may sue a public entity or public employee for ‘money or damages’ unless a timely written claim has been presented to and denied by the public entity.” (Ibid.)
“Compliance is mandatory, and cannot be excused on the theory that the entity was not surprised by the suit. ‘It is not the purpose of the claims statutes to prevent surprise. Rather, the purpose of these statutes is to provide the public entity sufficient information to enable it to adequately investigate claims and to settle them, if appropriate, without the expense of litigation. [Citations.] It is well-settled that claims statutes must be satisfied even in [the] face of the public entity’s actual knowledge of the circumstances surrounding the claim. Such knowledge—standing alone—constitutes neither substantial compliance nor basis for estoppel.’ [Citation.] The failure to timely present a proper claim for money or damages to a public entity bars a plaintiff from filing a lawsuit against that entity. [Citation.]” (Gong v. City of Rosemead (2014) 226 Cal.App.4th 363, 374 (Gong).)
“The procedural requirements for claim presentation are prerequisites to litigation against a local public entity or employee thereof based not only on tort liability, but on any claim for ‘money or damages.’ [Citation.] A cause of action that is subject to the statutory claim procedure must allege either that the plaintiff complied with the claims presentation requirement, or that a recognized exception or excuse for noncompliance exists. A plaintiff may allege compliance with the claims requirements by including a general allegation that he or she timely complied with the claims statute. [Citation.] If the plaintiff fails to include the necessary allegations, the complaint is subject to attack by demurrer. [Citation.]” (Gong, supra, 226 Cal.App.4th at p. 363, 374.)
As stated above, the court previously sustained the demurrer on the ground that Plaintiff did not allege compliance with the claims statutes or an excuse for non-compliance. Again, using a judicial council form, the SAC does not allege compliance with the claims statutes. Rather, Plaintiff has checked the box stating he is excused from complying and alleges the following:
“Citing: Government Code, 950.8. The complaint was filed within the applicable statute of limitations, and the cause of action was reasonable discovered, after the internal affairs investigation.” (SAC at p. 2 at #9(b).)
This allegation is identical to the one previously contained in the FAC and rejected by the court in the prior demurrer. The allegation does not constitute a proper exception or excuse for non-compliance with the Government Claims Act. For example, Plaintiff’s vague statement regarding the statute of limitations is not a valid excuse. Nor is Plaintiff’s reliance on Government Code section 950.8 which provides:
“Any provision of a charter, ordinance or regulation heretofore or hereafter adopted by a local public entity which requires the presentation of a claim as a prerequisite to the maintenance of an action against a public employee to enforce his personal liability is invalid.”
The language of section 950.8 however only applies to a local regulation or ordinance, and simply indicates that a local ordinance, or regulation, cannot usurp, or modify, the necessary prerequisite of a government claim. Nothing in this section suggests Plaintiff should be excused from non-compliance with the Government Claims Act. Plaintiff appears to concede this issue as he fails to address it in his opposition. Instead, Plaintiff primarily focuses on the defenses of res judicata and collateral estoppel which are not relevant to resolving the Government Claims Act issue on this demurrer. (See OPP at pp. 2-6; see also Alston v. Dawe (2020) 52 Cal.App.5th 706, 725 [res judicata and collateral estoppel are procedural concepts and affirmative defenses concerned with the need for finality and avoiding relitigation of issues].)
Accordingly, the demurrer to the SAC is SUSTAINED for failure to comply with the Government Claims Act.
Failure to State a Claim
“Public entities in California are not liable for tortious injury unless liability is imposed by statute. [Citation.] ‘[S]overeign immunity is the rule in California; governmental liability is limited to exceptions specifically set forth by statute.’ [Citations.]” (San Mateo Union High School Dist. v. County of San Mateo (2013) 213 Cal.App.4th 418, 427 (San Mateo Union High School Dist).)
“[Government Code] Section 815 establishes that public entity tort liability is exclusively statutory: ‘Except as otherwise provided by statute: [¶] (a) A public entity is not liable for an injury, whether such injury arises out of an act or omission of the public entity or a public employee or any other person.’ ” (C.A. v. Williams S. Hart Union High School Dist. (2012) 53 Cal.4th 861, 868.)
“ ‘This section abolishes all common law or judicially declared forms of liability for public entities, except for such liability as may be required by the state or federal constitution, e.g., inverse condemnation. In the absence of a constitutional requirement, public entities may be held liable only if a statute (not including a charter provision, ordinance or regulation) is found declaring them to be liable. … [¶] … [¶] … [T]here is no liability in the absence of a statute declaring such liability.’ [Citation.]” (Corona v. State of California (2009) 178 Cal.App.4th 723, 728.)
“This means that ‘ “liability of public entities must be based on a specific statute declaring them to be liable, or at least creating some specific duty of care” ’ to the plaintiff. [Citations.]” (San Mateo Union High School Dist., supra, 213 Cal.App.4th at p. 428.) “The law’s clear purpose was ‘ “ ‘not to expand the rights of plaintiffs in suits against governmental entities, but to confine potential governmental liability to rigidly delineated circumstances.’ ” ’ [Citation.]” (Ellerbee v. County of Los Angeles (2010) 187 Cal.App.4th 1206, 1214.)
As stated above, the court previously sustained the demurrer to the FAC because Plaintiff did not state a valid claim. Specifically, Plaintiff did not allege a cause of action arising from a statute. That is the case here as the SAC alleges claims for negligence, intentional tort, and “property damage, negligent cause” which do not arise from any particular statute. (See McCarty v. Department of Transportation (2008) 164 Cal.App.4th 955, 977 [“Once again, a public entity cannot be held liable for common law negligence.”]; see also Torres v. Department of Corrections & Rehabilitation (2013) 217 Cal.App.4th 844, 850 [“Although the complaint sounds in negligence, there is no common law tort liability for public entities in California.”].)
In opposition, Plaintiff contends his action against Defendants arises from Code of Civil Procedure section 338 which is also cited briefly in the SAC. (See OPP at pp. 7-8; SAC at p. 6.) This statute however does not impose liability against a public entity or create some specific duty of care. Instead, section 338 outlines the three-year statute of limitations applicable to certain claims delineated in the statute. (See Code Civ. Proc., § 338, subds. (a) – (p).)
Therefore, the demurrer to the SAC is SUSTAINED for failure to state a valid claim.
Statute of Limitations
A statute of limitations prescribes the period “beyond which a plaintiff may not bring a cause of action. [Citations.]” (Fox, supra, 35 Cal.4th at p. 806.) It “strikes a balance among conflicting interests. If it is unfair to bar a plaintiff from recovering on a meritorious claim, it is also unfair to require a defendant to defend against possibly false allegations concerning long-forgotten events, when important evidence may no longer be available.” (Pooshs v. Philip Morris USA, Inc. (2011) 51 Cal.4th 788, 797.)
“A plaintiff must bring a claim within the limitations period after accrual of the cause of action. In other words, statutes of limitation do not begin to run until a cause of action accrues. Generally speaking, a cause of action accrues at the time when the cause of action is complete with all its elements.” (V.C. v. Los Angeles Unified School Dist. (2006) 139 Cal.App.4th 499, 509-510, internal citations and quotation marks omitted.)
Although the statute of limitations is a factual issue, it can be subject to demurrer if the pleading discloses that the statute of limitations has expired regarding one or more causes of action. (Fuller v. First Franklin Financial Corp. (2013) 216 Cal.App.4th 955, 962.) If a demurrer demonstrates that a pleading is untimely on its face, it becomes the plaintiff’s burden “even at the pleading stage” to establish an exception to the limitations period. (Aryeh v. Cannon Business Solutions, Inc. (2013) 55 Cal.4th 1185, 1197.)
A court may sustain a demurrer on the ground of failure to state sufficient facts if “the complaint shows on its face the statute [of limitations] bars the action.” (E-Fab, Inc. v. Accountants, Inc. Services (2007) 153 Cal.App.4th 1308, 1315 (E-Fab, Inc.).) A demurrer is not sustainable if there is only a possibility the cause of action is time-barred; the statute of limitations defense must be clearly and affirmatively apparent from the allegations in the pleading. (Id. at pp. 1315-1316.)
When evaluating whether a claim is time-barred, a court must determine (1) which statute of limitations applies and (2) when the claim accrued. (E-Fab, Inc., supra, 153 Cal.App.4th at p. 1316.)
As stated above, Plaintiff has not alleged any valid cause of action based on statute to impose liability against a public entity. As a consequence, the court cannot properly determine which statute limitations applies and when the claim accrued. The court therefore declines to consider this argument.
Leave to Amend
Should the court sustain the demurrer, Plaintiff requests further leave to amend. (See OPP at p. 8.)
“The plaintiff bears the burden of proving there is a reasonable possibility of amendment.” (Rakestraw v. California Physicians’ Service (2000) 81 Cal.App.4th 39, 43 (Rakestraw).) To satisfy this burden, a plaintiff “must show in what manner he (or she) can amend his (or her) complaint and how that amendment will change the legal effect of his pleading.” (Goodman v. Kennedy (1976) 18 Cal.3d 335, 349.) “Plaintiff must clearly and specifically set forth the ‘applicable substantive law’ [citation] and the legal basis for amendment, i.e., the elements of the cause of action and authority for it. Further, plaintiff must set forth factual allegations that sufficiently state all required elements of that cause of action. [Citations.] Allegations must be factual and specific, not vague or conclusionary.” (Rakestraw, supra, at 81 Cal.App.4th at pp. 43-44.)
The court here has already afforded Plaintiff an opportunity to amend and he has not yet been able to state a valid cause of action against Defendants to overcome a pleading challenge on demurrer. Nor does Plaintiff explain how any such amendment will change the legal effect of his pleading. Again, Plaintiff is not relieved of this burden in proving a reasonable possibility of amendment by virtue of his self-representation status. (See Harding v. Collazo (1986) 177 Cal.App.3d 1044, 1055-1056 [a litigant appearing in propria persona is not entitled to special treatment].) As a consequence, the court finds no basis for further amendment.
Accordingly, leave to amend is DENIED. (See Shaeffer v. Califia Farms, LLC (2020) 44 Cal.App.5th 1125, 1145 [“The onus is on the plaintiff to articulate the ‘specifi[c] ways’ to cure the identified defect, and absent such an articulation, a trial or appellate court may grant leave to amend ‘only if a potentially effective amendment [is] both apparent and consistent with the plaintiff’s theory of the case. [Citation.]’ ”].)
Disposition
The demurrer to the SAC is SUSTAINED WITHOUT LEAVE TO AMEND for failure to comply with the Government Claims Act and failure to state a valid claim.
The court will prepare the Order.
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Case Name: Kuba Litwin v. Matthew Caldwell, et al.
Case No.: 21-CV-390847
I. Factual and Procedural Background
According to the allegations of the cross-complaint (“XC”), plaintiff and cross-defendant Kuba Litwin (“Litwin”) was employed as an accountant by defendant and cross-complainant RocketPower Ops, LLC (“RPO”). (See XC, ¶ 5.) During his employment, Litwin had access to RPO’s confidential information, including trade secrets. (Id. at ¶¶ 6-8.)
RPO required Litwin to review and sign an employment agreement because he had access to confidential information in the regular course of his job. (See XC, ¶ 10 and Exhibit 1.) The employment agreement defines RPO’s “confidential information” to include customer lists and accounting records. (Id. at ¶ 11.) It also requires Litwin to protect RPO’s confidential information during his employment and upon termination. (Id. at ¶¶ 12-13).
At or near the end of Litwin’s employment at RPO – without the employer’s knowledge or consent and contrary its policies regarding confidentiality – Litwin forwarded various email and documents, including emails containing employer’s confidential information, to his personal email address. (See XC, ¶ 15.) After RPO terminated Litwin, he remained in possession of RPO’s confidential information and did not disclose this fact to RPO. (Id. at ¶ 16.) Litwin still has a large amount of RPO’s confidential information in his possession and control. (Id. at ¶ 17.) RPO does not know how much of its confidential information Litwin retained during and after his employment or how much Litwin has sent to third parties. (Id. at ¶ 18.)
On October 22, 2021, Litwin filed a complaint against Mathew Caldwell, RPO, and others (collectively, “Cross-complainants”) alleging causes of action for unpaid wages, penalty for unpaid wages, failure to produce payroll records, whistleblower retaliation, and wrongful termination.
On August 10, 2022, Cross-complainants filed the XC alleging causes of action for misappropriation of trade secrets and breach of contract.
Litwin demurs to each cause of action of the XC on the ground that they fail to state facts sufficient to constitute a cause of action.
II. Demurrer to the Cross-Complaint
Legal Standard
“In reviewing the sufficiency of a complaint against a general demurer, we are guided by long settled rules. ‘We treat the demurrer as admitting all material facts properly pleaded, but not contentions, deductions or conclusions of fact or law. We also consider matters which may be judicially noticed.’ ” (Blank v. Kirwan (1985) 39 Cal.3d 311, 318.) “A demurrer tests only the legal sufficiency of the pleading. It admits the truth of all material factual allegations in the complaint; the question of plaintiff’s ability to prove these allegations, or the possible difficulty in making such proof does not concern the reviewing court.” (Committee on Children’s Television, Inc. v. General Foods Corp. (1983) 35 Cal.3d 197, 213–214.)
“The reviewing court gives the complaint a reasonable interpretation, and treats the demurrer as admitting all material facts properly pleaded. The court does not, however, assume the truth of contentions, deductions or conclusions of law. … [I]t is error for a trial court to sustain a demurrer when the plaintiff has stated a cause of action under any possible legal theory. And it is an abuse of discretion to sustain a demurrer without leave to amend if the plaintiff shows there is a reasonable possibility any defect identified by the defendant can be cured by amendment.” (Gregory v. Albertson’s, Inc. (2002) 104 Cal.App.4th 845, 850.)
A. First Cause of Action: Misappropriation of Trade Secrets
Plaintiff contends the XC fails to state facts sufficient to constitute a cause of action for misappropriation of trade secrets because: 1) it fails to allege misappropriation; and 2) it fails to identify a trade secret with sufficient particularity.
1. Whether the Cross-Complaint Alleges Misappropriation
Under the California Uniform Trade Act (“CUTSA”), the elements for a cause of action for misappropriation of trade secrets are: “(1) possession by the plaintiff of a trade secret; (2) the defendant's misappropriation of the trade secret, meaning its wrongful acquisition, disclosure, or use; and (3) resulting or threatened injury to the plaintiff.” (Silvaco Data Systems v. Intel Corp. (2010) 184 Cal.App.4th 210, 220, disapproved on other grounds by Kwikset Corp v. Superior Court (2011) 51 Cal.4th 310.) Relying largely on Cypress Semiconductor Corp. v. Superior Court, (2008) 163 Cal.App.4th 575, Silvaco, supra, 184 Cal.App.4th 210, and a number of federal cases, Plaintiff contends that the first cause of action is subject to demurrer because it merely alleges possession as opposed to misappropriation. But, “‘misappropriation’ can occur through improper acquisition of a trade secret, not only through use.” (Silvaco, supra, 184 Cal.App.4th at p. 223 (stating that “wrongful acquisition of a trade secret may be actionable in itself”), citing San Jose Construction, Inc. v. S.B.C.C., Inc. (2007) 155 Cal.App.4th 1528, 1544.)
Civil Code section 3426.1, subd. (a), defines “misappropriation” of a trade secret to include “[a]cquisition of a trade secret of another by a person who knows or has reason to know that the trade secret was acquired by improper means.” Subdivision (a) defines “improper means” to include “theft, bribery, misrepresentation, breach or inducement of breach of duty to maintain secrecy, or espionage through electronic or other means.” Thus, one need not allege disclosure or use of a trade secret to allege “misappropriation,” as defined by the statute.
In Silvaco, the plaintiff corporation had previously secured a judgment against software developer CSI after alleging it had misappropriated trade secrets used in its software and incorporated them into its own products. (Silvaco, supra, 184 Cal.App.4th at p. 216.) Defendant Intel had purchased CSI’s software to test its integrated circuits. (Ibid.) After obtaining the judgment against CSI, Silvaco filed a complaint against Intel, alleging that it misappropriated its trade secrets by using CSI’s software. (Ibid.) It was undisputed that Intel never had access to the underlying “source code” at issue in the action against CSI. (Ibid.) Silvaco argued that Intel’s mere acquisition of CSI’s software was actionable in itself. (Silvaco, supra, 184 Cal.App.4th at p. 222.) Thus in the context of a misappropriation claim under Civil Code section 3426.1, the Sixth District distinguished “acquisition” from passive receipt:
“To acquire a thing is, most broadly, to ‘receive’ or ‘come into possession of’ it. But the term implies more than passive reception; it implies pointed conduct intended to secure dominion over the thing, i.e., ‘[t]o gain, obtain, or get as one’s own, to gain the ownership of (by one’s own exertions or qualities).’ [¶] One does not ordinarily ‘acquire’ a thing inadvertently; the term implies conduct directed to that objective. The choice of that term over ‘receive’ suggests that inadvertently coming into possession of a trade secret will not constitute acquisition. Thus one who passively receives a trade secret, but neither discloses nor uses it, would not be guilty of misappropriation.”
(Silvaco, supra, 184 Cal.App.4th at pp. 222-223, internal citations omitted.)
In this case, the first cause of action alleges that Litwin misappropriated RPO’s confidential information by forwarding company emails and documents to his personal email address. (See XC, ¶¶ 11-15, 21.) While Litwin’s alleged emails to himself, or failure to disclose and return confidential information upon termination, may be distinguishable from the passive receipt of trade secrets in Silvaco, the XC nevertheless fails to allege misappropriation of a trade secret. Allegations of forwarded emails with unspecified confidential information are insufficient to state misappropriation of trade secrets, particularly where the XC defines confidential information as including trade secrets, but is broader and includes other non-trade secret information. (See XC ¶¶ 7, 8, and 9). The federal cases cited by Cross-complainants are of little help. For example, while Cross-complainants rely on Allergan, Inc. v. Merz Pharmaceiticals, LLC (2012) U.S. Dist. LEXIS 31981, that case is inapplicable because, there, the plaintiff’s claims “arose from defendant’s breach of contractual, not statutory, duties.” (Vigil v. Muir Medical Group IPA, Inc. (2022) 84 Cal.App.5th 197, 217, fn. 5.) To state sufficient facts for a claim for misappropriation of a trade secret under CUTSA, the alleged misappropriation must be of a trade secret as defined by statue, not simply material defined by a contract to be confidential. (See Civil Code section 3426.1.)
Thus, the XC does not sufficiently allege misappropriation.
2. Whether the Cross-Complaint Identifies a Trade Secret With Sufficient Particularity
Litwin argues that the XC has only made conclusory allegations and fails to allege the trade secrets with “reasonable particularity,” citing Diodes, Inc. v. Franzen (1968) 260 Cal.App.2d 244. In Diodes, the defendants were the president and vice president of Diodes who were in complete control of its research and development program. (Id. at p.249.) Diodes alleged that the defendants misappropriated their “secret process.” (Id. at p.250.) However, the Diodes third amended complaint “speaks in circumlocutions and innuendoes… [t]he subject matter of the so-called ‘secret process’ is not stated, except to hint that it had something to do with the manufacture of diodes.” (Id. at p.251.) “The allegations amount to this: [defendants] told the board that they developed a “metallurgical process” in manufacturing diodes, but did not tell the board the details of that process. (Id. at p. 251-252) The Diodes court found that the allegations were insufficient:
“One who seeks to protect his trade secret from wrongful use or disclosure does not have to spell out the details of the trade secret to avoid a demurrer to a complaint …The plaintiff must nevertheless allege ultimate facts showing the existence of a trade secret or other confidential data to state such a cause of action. Before a defendant is compelled to respond to a complaint upon claimed misappropriation or misuse of a trade secret and to embark on discovery which may be both prolonged and expensive, the complainant should describe the subject matter of the trade secret with sufficient particularity to separate it from matters of general knowledge in the trade or of special knowledge of those persons who are skilled in the trade, and to permit the defendant to ascertain at least the boundaries within which the secret lies.”
(Diodes, supra, 260 Cal.App.2d at pp. 252-253, internal citations omitted.)
Here, as in Diodes, while the XC plainly alleges that Litwin misappropriated trade secrets, there is very little if any description or identification of the alleged trade secrets in question. The XC alleges that Litwin emailed RPO’s “confidential information” to his personal email address; however, at no point does the XC state what kind of information was in the emails that Litwin sent himself, nor does it even allege that those emails actually contained trade secrets. (See XC, ¶ 15.) While it is possible that the alleged “confidential information” could be trade secrets (see XC, ¶ 11), there is no allegation of any facts showing the existence of a trade secret so as to state a cause of action. As Litwin himself suggests in his reply, an averment that he had taken a list of RPO’s customers would sufficiently allege a trade secret (see Courtesy Temp. Serv. v. Camacho (1990) 222 Cal.App.3d 1278, 1287-1288 (concluding customer list is a trade secret since “Courtesy's customer list and related information was the product of a substantial amount of time, expense and effort on the part of Courtesy… [m]oreover, the nature and character of the subject customer information, i.e., billing rates, key contacts, specialized requirements and markup rates, is sophisticated information and irrefutably of commercial value and not readily ascertainable to other competitors”); Morlife, Inc. v. Perry (1997) 56 Cal.App.4th 1514, 1521; and American Credit Indemnity Co. v. Sacks (1989) 213 Cal.App.3d 622, 630-632), the XC does not allege that Litwin took a customer list. In fact, the language of the XC is vague enough to include activity other than the emails that Litwin sent himself at or near the end of his employment. (See XC at ¶¶ 7-8, 17-18.) Thus, from the face of the XC, it is impossible to determine the “ultimate facts” upon which Cross-complainants base their claim of a trade secret. (See Diodes, supra, 260 Cal.App.2d at p. 252.)
The court acknowledges that at issue here is the sufficiency of the pleading rather than the scope of permissible discovery. Cross-complainants are correct that the standard applicable on demurrer is distinguishable from the requirement of Code of Civil Procedure section 2019.210. By its own terms, the latter applies “at the commencement of discovery.” (Code Civ. Proc. § 2019.210.) But here, with respect to the claim for misappropriation of trade secrets, “[t]he pleading does not state facts sufficient to constitute a cause of action” because it does not allege ultimate facts showing the existence of a trade secret. (Code Civ. Proc. § 430.10, subd. (e).)
Consequently, the demurrer to the first cause of action is SUSTAINED with 10 days leave to amend.
B. Second Cause of Action: Breach of Contract.
Litwin contends the XC fails to state facts sufficient to constitute a cause of action for breach of contract.
Under California law, a plaintiff must plead facts establishing the following elements for a breach of contract claim: (1) existence of the contract; (2) plaintiff’s performance or excuse for nonperformance; (3) defendant’s breach; and (4) damages to plaintiff as a result of the breach. (CDF Firefighters v. Maldonado (2008) 158 Cal.App.4th 1226, 1239.)
Litwin argues that the second cause of action fails to states facts sufficient to constitute a breach of contract cause of action because it is necessarily dependent on the first cause of cause of action for misappropriation of trade secrets. However, these causes of action are distinct with different elements.
The XC alleges that: there was an employee agreement (see XC, ¶¶ 26-28); RPO performed its responsibilities under the agreement or that performance was excused (id. at ¶ 31); Litwin breached the contract by misappropriating confidential information as described by the contract (id. at ¶¶ 29-30); and, RPO has sustained damages caused by Litwin’s breach (id. at ¶¶ 32-34). Thus, as the second cause of action alleges each of the elements of a breach of contract cause of action, the argument that the second cause of action fails to state facts sufficient to constitute a cause action is without merit.
Consequently, the demurrer to the second cause of action is OVERRULED.
The court will prepare the Order.
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Calendar Line 7
Case Name: Weckworth Electric Group, Inc. v. Metcalf Builders, Inc. et al.
Case No.: 19CV358030 (Consolidated with Case Nos. 19CV351620, 19CV360725, and 20CV369509)
BACKGROUND
Plaintiff Weckworth Electric Group (WEG) filed its original complaint on November 4, 2019. A number of related cases were subsequently filed and the cases were consolidated on April 29, 2021. On September 20, 2022 (and again on December 5, 2022), Plaintiff Weckworth Electric Group (WEG) filed a motion for preference pursuant to Cal. Code of Civil Procedure § 36(f). Plaintiff and Cross-Defendant Johnson Controls Fire Protection LP, Defendants Hyatt Corp., San Jose Hotel Partners, LLC, HPHH San Jose, LLC, and PNC Bank, and Defendant and Cross-Complainant Metcalf Builders (hereinafter collectively referred to as “Defendants”) all filed oppositions to the motion for preference on either December 19, 2022 or January 3, 2023. WEG filed its reply to the oppositions on January 9, 2023. Hearing on the motion is set for January 17, 2023.
SUMMARY OF CONTENTIONS
WEG asserts that it is entitled to trial preference pursuant to Code of Civil Procedure section 36(a) because Mr. Weckworth, a key witness, owner, and major shareholder of Plaintiff is 77 years old, has a terminal illness, and is in failing health. Alternatively, Plaintiff contends pursuant to CCP § 36(e) that it would serve the interests of justice to give the case trial preference because of Mr. Weckworth’s age and deteriorating health.
In essence, the opposing parties argue that because Mr. Weckworth is not a party, CCP § 36(a) does not apply to him. They further argue that granting the preference under CCP § 36(e) would not serve the interests of justice. There are multiple parties and discovery has not been completed. Denying the other parties in the case reasonable time to complete discovery would prejudice them and deny them due process. Moreover, they claim that there would be no prejudice to plaintiff from denying the request, as Mr. Weckworth’s deposition was already taken at the request of plaintiff, in order to preserve his testimony for trial.
Plaintiff responds to Defendants’ claims that their case will be prejudiced by asserting that they have had years to conduct discovery, such that any prejudice to them from an early trial date is their own fault.
ANALYSIS
Code of Civil Procedure section 36, subdivision (a) provides that “[a] party to a civil action who is over 70 years of age may petition the court for a preference, which the court shall grant if the court makes both of the following findings: (1) The party has a substantial interest in the action as a whole. (2) The health of the party is such that a preference is necessary to prevent prejudicing the party’s interest in the litigation.”
Regardless of Mr. Weckworth’s age, health condition, or interest in the action, the opposing parties argue that the Court cannot grant Plaintiff’s request under § 36(a) because Mr. Weckworth is not a party to the litigation. Rather, the sole Plaintiff in the case is Weckworth Electric Group, a corporation. Defendants contend that there is no authority for granting a trial preference based on the age or ill health of a witness, who is not a party, regardless of that witness’s interest in the case. Defendants further point out that Plaintiff has cited no authority to suggest that § 36(a) applies to a corporation. In its reply, Plaintiff basically concedes that it is not entitled to the benefits of 36(a), describing the statute’s application to this case as “problematic.” See Reply p2. The Court agrees that CCP § 36(a) is limited to parties and that because Mr. Weckworth is not a party to the instant case, Plaintiff is not entitled to trial preference under this provision.
Plaintiff alternatively asserts that the court in its discretion can grant it trial preference under CCP § 36(e). That subsection provides that “[n]otwithstanding any other provision of law, the court may in its discretion grant a motion for preference that is supported by a showing that satisfies the court that the interests of justice will be served by granting this preference.” To meet this standard Plaintiff cites to Mr. Weckworth’s age of 77, his deteriorating health, and his substantial interest in the outcome of the case given his role as owner and key shareholder of Plaintiff. Additionally, Plaintiff contends that because it has acted diligently in moving the case forward, and because the case was originally filed in 2019 and its claim for lien still has not been heard, despite the fact that such claims should ordinarily be brought to trial within two years (citing CC 8462), it is in the interests of justice to set this case for trial within 120 days.
Defendants counter that their right to discovery would be prejudiced if the case were to be set within 120 days and that Plaintiff would not be prejudiced by allowing them to finish discovery. Defendants point out that Mr. Weckworth’s deposition was taken in May of 2022, so as to preserve his testimony for trial. As such, Plaintiff would not be prejudiced even if Mr. Weckworth were unable to be present for trial. Defendants contend that “significant” discovery remains for all of the consolidated matters to be ready for trial. According to the declaration of the Hyatt Defendants’ counsel, multiple parties have yet to be deposed, some parties have still not issued written discovery or responded to written discovery, and no end date for discovery has been set yet. The declaration further asserts that the claims and cross-claims are extensive, require significant discovery and investigation, and will likely require experts, none of whom have been disclosed at this time.
It should be noted that the Hyatt Defendants also take issue with the severity of Mr. Weckworth’s medical condition, note that his prognosis is not supported by a doctor’s declaration, and claim he has not shown that his deteriorating condition is a result of the litigation (see Hyatt Opposition pp12-15). The Court does not question Mr. Weckworth’s condition and notes that his statements regarding his own health, fatigue, and deterioration of cognitive process, including concentration and communication, are facts within his personal knowledge and experience.
In making a determination, the Court must consider the “total picture,” including "the condition of the court calendar, dilatory conduct by plaintiff, prejudice to defendant of an accelerated trial date, and the likelihood of eventual mandatory dismissal if the early trial date is denied." Howard v. Thrifty Drug & Discount Stores (1995) 10 Cal. 4th 424, 441. In all, these factors weigh in favor of denying Plaintiff’s request. The Court calendar is very congested over the next 120 days (though this is not the reason the request is being denied). While it may be that some delay in finishing discovery has been caused by Defendants’ conduct, it is also true that Covid has been a factor in causing delay for the parties, as some depositions had to be postponed at Plaintiff’s request (see Declaration of Perry ¶8). The Court does not find that either Plaintiff or Defendants have been dilatory. This is a case involving many parties and many claims. Plaintiff does not dispute that expert discovery is still needed in the case or that no experts have yet been disclosed. As such, Defendants may be prejudiced by an accelerated trial date. Plaintiff has not shown that it would be prejudiced if the case were not awarded preferential status, given that Mr. Weckworth’s deposition has been taken and his testimony preserved. Finally, there is little likelihood of eventual mandatory dismissal if an early trial date is denied since CC §8462 is not mandatory, and we are not yet near the five-year deadline.
While the Court is sympathetic to Plaintiff and to the need to have this case heard expeditiously, the Court does not believe the interests of justice warrant giving preference to this case under CCP § 36(e) given the complexity of the case, the need to conduct more and expert discovery, and given that Mr. Weckworth’s testimony has been preserved. As suggested by Plaintiff, the Court is inclined to refer this case to the trial setting calendar so that the case will be heard in the Summer or early Fall of 2023. An additional six to nine months should give the parties the requisite time to prepare for trial.
The Motion is DENIED. Defendant Hyatt shall prepare the final order.
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Calendar Line 8
Case Name: Delfino Birrueta-Cruz v. Nomandin’s, a Corporation, et al.
Case No.: 21CV383939
BACKGROUND
On October 7, 2022, Intervenor Labor Commissioner (“Commissioner”) filed a Motion to Modify Order Compelling Arbitration and Staying Proceedings. Respondent Normandin’s filed an opposition on January 3, 2023. The Labor Commissioner filed a reply on January 9, 2023. Hearing on the motion is set for January 17, 2023.
SUMMARY OF CONTENTIONS
The Labor Commissioner has intervened and now asks this Court to modify its Order of December 21, 2021 (hereinafter “the Order”) to compel arbitration and stay proceedings to make explicit that notwithstanding any agreement between Appellant and Respondent to arbitrate employment disputes, the Labor Commissioner has the right to investigate and prosecute, if warranted, the retaliation claim filed by Appellant under Labor Code Section 98.7. The Commissioner asserts this is warranted under Code of Civil Procedure section 473(d) because the stay Order is void as to the Labor Commissioner, in that at the time of the Order’s issuance, the Court lacked personal jurisdiction over the Commissioner. Commissioner argues that relief is also warranted under Code of Civil Procedure section 1008(a) or (c) because the case of Crestwood Behavioral Health, Inc. v. Lacy (2021), 70 Cal.App.5th 560 controls and presents new law (as compared to the law that was presented to the Court when it issued the stay Order) essential to a proper ruling on the issue of whether the Labor Commissioner should be subject to a stay order.
Respondent Normandin’s contends that a modification is not needed because the Order does not stay the Commissioner from investigating or prosecuting the retaliation claim. In any event, respondent also argues that the Federal Arbitration Act preempts the Crestwood decision, citing Preston v. Ferrer (2008) 552 U.S. 346.
ANALYSIS
1. Modification of the Order is Necessary Regardless of Respondent’s Concession that the Order Does Not Stay the Commissioner’s Retaliation Claim
In opposing the motion, Respondent first claims that the Order does not in fact stay the Commissioner from investigating or prosecuting the retaliation claim. As such, this Court does not need anything more to grant Commissioner’s motion. If Respondent believes the Order does not in fact stay the Commissioner’s actions, then as the Commissioner argues, there is no harm or prejudice to Respondent from modifying the order to make that fact explicit. On this basis alone, the Court will grant the motion.
Despite Respondent’s admission, a modification to the Order is necessary to make explicit that the Commissioner’s investigation is not stayed for two reasons. First, the Order needs to be modified because the plain language of the Order stays the retaliation claim, despite Respondent’s argument that it does not. The Order states:
IT IS HEREBY ORDERED THAT Appellant arbitrate all individual claims against Respondent, including . . . State Case N0. RCI—CM—817756 filed with the California Department of Industrial Relations, Office of the Labor Commissioner, Retaliation Complaint Unit; and IT IS HEREBY ORDERED THAT . . . all claims ordered to arbitration herein above are hereby stayed until the arbitration is completed.
As such, the Order specifically refers the retaliation claim to arbitration and then stays all claims referred to arbitration. It is hard to see how the Order could be read to not stay the retaliation claim from moving forward during the pendency of the arbitration.
Secondly, it is necessary to modify the Order because Respondent has previously claimed that the Order did stay the Commissioner from proceeding with the retaliation claim. Respondent’s counsel emailed the Labor Commissioner’s retaliation complaint investigator on December 28, 2021, asking her to confirm that “the Labor Commissioner will stay the action and not move forward with any hearing until after the arbitration process has taken place in accordance with the ordered stay.” See Declaration of John P. Boggs In Support of Opposition to the Labor Commissioner’s Motion to Modify Order Compelling Arbitration and Staying Proceedings, Ex. A).
2. The Stay Order is Void as to the Labor Commissioner and Will be Set Aside
Although not necessary, the Court will address Respondent’s other objections to modifying the order. The Commissioner asserts that she was not made a party and did not receive lawful notice of the motion to compel arbitration and stay the proceedings, such that the order is void and should be set aside. (Commissioner’s Motion pp10-13.) Respondent contends that he did not need to make the Labor Commissioner a party to the action or provide notice to her because he did not seek to enjoin the Commissioner from exercising her independent prosecutorial authority. This Court finds that because Respondent did seek to enjoin the Commissioner, his argument fails. (See Memorandum of Points and Authorities in Support of Petition to Compel Arbitration and Stay or Dismiss Proceedings filed 9/20/21 at p2: “not only must [Appellant’s] review of the rejected wage claims be pursued in arbitration, but every other claim . . . including . . . that he was subjected to retaliation. . . must be adjudicated . . . in arbitration. As such, Respondent respectfully request that this Court grant its Petition . . . staying or dismissing his judicial and administrative actions until arbitration is completed”). Respondent provides no authority for the proposition that because the deputy labor commissioner had actual knowledge of his petition, he was relieved of his duty to properly serve the Labor Commissioner. As such, the Court agrees with the arguments set out in Commissioner’s motion at pp10-13 and finds the Order void as to the Labor Commissioner and sets aside the Order as to the Labor Commissioner under CCP § 473(d).
Alternatively, the Commissioner argues that the Crestwood case requires reconsideration and modification of the Order because it was not considered by the Court at the time of the hearing on the petition and it dictates that the retaliation claim should not be stayed. (Commissioner’s Motion pp 13-15). Respondent claims that Crestwood is inapplicable and that in any event, the Federal Arbitration Act preempts Crestwood. Both these arguments fail. As argued by Commissioner, Crestwood has almost identical facts and is controlling in this matter and Respondent’s attempts to distinguish it fail. Respondent’s papers initially seeking the order to compel arbitration and stay the proceedings specifically included a request to stay all claims, including the retaliation claim. Nor is Crestwood preempted by the FAA, for all the reasons laid out both in the Crestwood decision itself and as laid out in Commissioner’s Reply brief at pp5-8. Respondent makes no argument suggesting that CCP section 1008(a) and (c) is unavailable in this case. Accordingly, because Crestwood dictates that the Commissioner may investigate and prosecute a complaint against an employer for retaliation against any employee covered by an agreement to arbitrate employment disputes, this Court’s order staying such proceedings will be vacated and a new order to arbitrate and stay proceedings will be issued explicitly stating that notwithstanding any agreement between Normandin’s and Mr. Birrueta-Cruz to arbitrate employment disputes, the Labor Commissioner has the right to investigate and, if warranted, to prosecute the retaliation complaint filed by Mr. Birrueta-Cruz, in accordance with the procedures set out in Labor Code § 98.7.
Intervenor Labor Commissioner’s Motion is GRANTED. Intervenor Labor Commissioner shall prepare and submit the modified order.
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[1] The Notice of Demurrer to the FAC was brought by defendants the City and Cayori. But, the memorandum in support of the demurrer provides that the Department of Public Safety is not a separate entity, but a department of the City. (See Memo of P’s & A’s at p. 1, fn. 1.) This information was also included on the Notice of Demurrer to the SAC. (See Notice at p. 1, fn. 1.) Thus, the Department of Public Safety is also included here as a defendant for purposes of this action.
[2] This deadline accounts for the court holiday on January 16, 2023.
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