On July 2, 2020, Plaintiff Forrest Kolb filed a first amended complaint (“FAC”) against Defendants Expertise LLC (“Expertise”), Stripes39, David Franklin, Salil Jain, Carl Ng, and Patrick Gavin (collectively, “Defendants”). On December 18, 2020, the Court sustained in part and overruled in part Defendants’ demurrer to the FAC. Plaintiff filed a second amended complaint (“SAC”) on January 12, 2021.
On February 11, 2021, Defendants filed a demurrer and motion to strike. Plaintiff’s request for judicial notice is granted.
Defendants demur to the sixth, seventh, and fifteenth causes of action. A demurrer for sufficiency tests whether the complaint states a cause of action. (Hahn v. Mirda (2007) 147 Cal.App.4th 740, 747.) When considering demurrers, courts read the allegations liberally and in context, accepting the alleged facts as true. (Nolte v. Cedars-Sinai Medical Center (2015) 236 Cal.App.4th 1401, 1406.) A special demurrer for uncertainty under Code of Civil Procedure section 430.10, subdivision (f) is disfavored and will only be sustained where the pleading is so bad that defendant or plaintiff cannot reasonably respond—i.e., cannot reasonably determine what issues must be admitted or denied, or what counts or claims are directed against him or her. (Khoury v. Maly’s of Calif., Inc. (1993) 14 Cal.App.4th 612, 616.) Even if the pleading is somewhat vague, “ambiguities can be clarified under modern discovery procedures.” (Ibid.)
“[F]acts in support of each of the requirements of a statute upon which a cause of action is based must be specifically pled.” (Fisher v. San Pedro Peninsula Hospital (1989) 214 Cal.App.3d 590, 604; see Hawkins v. TACA Internat. Airlines, S.A. (2014) 223 Cal.App.4th 466, 478 (Hawkins) [“[S]imply parroting the language of [a statute] in the complaint is insufficient to state a cause of action under the statute.”].)
- Sixth/Seventh Causes of Action
The sixth cause of action alleges discrimination based on Plaintiff’s disability. The seventh cause of action alleges Defendants failed to prevent discrimination against Plaintiff. Defendants argue Plaintiff does not allege sufficient facts about his disability or medical condition. (Demurrer at pp. 6-7.)
The SAC alleges, “Plaintiff’s disability (both actual and perceived) and association with disabled persons (both actual and perceived) and/or other characteristics protected by FEHA, Government Code section 12900, et seq., were substantial motivating reasons in defendants’ decision to terminate plaintiff’s employment and/or to take other adverse employment actions against plaintiff.” (SAC ¶ 69.) In February 2020, Plaintiff told Defendants his family was ill, and he sent an email about risking exposure to Covid. (SAC ¶ 20(a), (d).) On about March 10, 2020, Plaintiff told Defendants he had a fever and asked for two days off. (SAC ¶ 20(c).) During this time, Plaintiff continued contract negotiations. (SAC ¶ 20(d).) On March 10, 2020, Plaintiff’s counsel sent a cease and desist letter regarding Defendants’ use of Plaintiff’s name and likeness and telling Defendants not to retaliate against Plaintiff. (SAC ¶ 20(d).) Within hours, Plaintiff told Defendants all communications needed to be directed to his attorney. One of the defendants then told Plaintiff that Defendants were not going to want to work for him. (SAC ¶ 20(e).) The next day Defendants locked Plaintiff out of his email accounts. (SAC ¶ 20(g).) On March 19, 2020, Plaintiff accepted the terms Defendant had proposed on February 28, 2020. (SAC ¶ 20(k).) On March 27, 2020, Defendant terminated his employment. (SAC ¶ 20(l).)
Plaintiff does not allege that he knew he or his family had Covid, or had told Defendants he or his family had Covid, before being terminated. Plaintiff does not allege whether he was discriminated against because he had a fever or because he had Covid. In his opposition, Plaintiff states his cause of actions are based on his disability as a person perceived to have contracted Covid. (Opposition at p. 6.) Accordingly, the demurrer to the sixth and seventh causes of action is sustained leave to amend to state expressly that these causes of action are based on the disability of being perceived to have contracted Covid.
- Fifteenth Cause of Action – Intentional Infliction of Emotional Distress
The fifteenth cause of action alleges Defendants intended to cause Plaintiff emotional distress by terminating his employment. (SAC ¶ 132.) “‘[T]o state a cause of action for intentional infliction of emotional distress a plaintiff must show: (1) outrageous conduct by the defendant; (2) the defendant’s intention of causing or reckless disregard of the probability of causing emotional distress; (3) the plaintiff’s suffering severe or extreme emotional distress; and (4) actual and proximate causation of the emotional distress by the defendant’s outrageous conduct.’ [Citation.] ‘Conduct, to be ‘outrageous’ must be so extreme as to exceed all bounds of that usually tolerated in a civilized society.’ [Citation.]” (Huntingdon Life Sciences, Inc. v. Stop Huntingdon Animal Cruelty USA, Inc. (2005) 129 Cal.App.4th 1228, 1259.) “While the outrageousness of a defendant’s conduct normally presents an issue of fact to be determined by the trier of fact [citation], the court may determine in the first instance, whether the defendant’s conduct may reasonably be regarded as so extreme and outrageous as to permit recovery.” (Trerice v. Blue Cross of California (1989) 209 Cal.App.3d 878, 883.)
Defendants contend that terminating employment is not “outrageous” conduct. (Demurrer at pp. 9.) Plaintiff alleges that extreme and outrageous conduct “occurred by and through individual defendants Franklin, Jain, Ng, and Gavin.” (SAC ¶ 135.) Plaintiff alleges that they “attempted to hide the true reason for their illegal actions in order to avoid liability and any their obligation to make Kolb whole,” “were aware that treating plaintiff in the manner alleged above, including depriving plaintiff of his livelihood, would devastate plaintiff and cause him extreme hardship,” abused their power to do so, and unlawfully terminated his employment “in during a Global Pandemic when they knew he needed his job to support his family.” (Id. at ¶ 134.) A claim for intentional infliction of emotional distress arising from employment is not barred when it is based on illegal employment practices such as discrimination. (Nazir v. United Airlines, Inc. (2009) 178 Cal.App.4th 243, 288.)
The SAC also alleges that Defendants’ use of Plaintiff’s name and likeness in marketing emails was extreme and outrageous because Defendants “decided to engage in this theft to rob from Kolb compensation instead of gainfully employing him,” and caused Plaintiff to lose control of his name and likeness, “leaving him helpless and Defendants free have their way with Kolb’s reputation and the way the outside world perceived him.” (SAC ¶ 136; see id. at ¶¶ 2, 18.) Defendants do not demur to these allegations or argue that they do not allege outrageous conduct.
Instead, Defendants argue that Plaintiff does not identify any “outrageous” conduct by the individual defendants, and the alter ego allegations are boilerplate. (Demurrer at pp. 9-10.) “In California, two conditions must be met before the alter ego doctrine will be invoked. First, there must be such a unity of interest and ownership between the corporation and its equitable owner that the separate personalities of the corporation and the shareholder do not in reality exist. Second, there must be an inequitable result if the acts in question are treated as those of the corporation alone.” (Sonora Diamond Corp. v. Superior Court (2000) 83 Cal.App.4th 523, 538.)
The SAC alleges that there was a unity of interest between Defendants “such that any individuality and separateness between or among those defendants has ceased, and defendants are the alter egos of one another.” (SAC ¶ 9.) Defendants exercised dominion and control over each other such that there was no individuality or separateness, and permitting their separate existence would promote injustice. (Ibid.) These allegations are sufficient to allege the individual defendants’ involvement on an alter ego theory at this stage.
Because at least some of the bases for this cause of action are sufficiently pleaded or not challenged by Defendants, the demurrer to the fifteenth cause of action is overruled. (See Fire Ins. Exchange v. Superior Court (2004) 116 Cal.App.4th 446, 452 [“Ordinarily, a general demurrer does not lie as to a portion of a cause of action, and if any part of a cause of action is properly pleaded, the demurrer will be overruled.”].)
MOTION TO STRIKE
The court may, upon a motion or at any time in its discretion: (1) strike out any irrelevant, false, or improper matter inserted in any pleading; or (2) strike out all or any part of any pleading not drawn or filed in conformity with the laws of California, a court rule, or an order of the court. (Code Civ. Proc., § 436, subds.(a)-(b).)
Defendants move to strike allegations related to punitive damages. A plaintiff can recover punitive damages in tort cases where “the defendant has been guilty of oppression, fraud, or malice.” (Civ. Code, § 3294, subd. (a).) Punitive damages thus require more than the mere commission of a tort. (Taylor v. Superior Court (1979) 24 Cal.3d 890, 894-895.) “[W]rongful termination, without more, will not sustain a finding of malice or oppression.” (Scott v. Phoenix Schools, Inc. (2009) 175 Cal.App.4th 702, 717.)
A corporate employer can be liable for punitive damages only when an officer, director, or managing agent of the corporation (1) had advance knowledge of the unfitness of the employee and employed him or her with a conscious disregard of the rights or safety of others, (2) authorized or ratified the wrongful conduct, or (3) was personally guilty of oppression, fraud, or malice. (Civ. Code, § 3294, subd. (b).) Specific facts must be pleaded in support of punitive damages. (Hillard v. A.H. Robins Co. (1983) 148 Cal.App.3d 374, 391-392.)
In the first and second causes of action, Plaintiff alleges that Defendants misappropriated his name and likeness “with a conscious disregard of plaintiff’s rights, with the intent to vex, annoy, and/or harass plaintiff and to unjustly profit from the use of plaintiff’s name, likeness, photograph, and identity,” constituting “oppression, fraud, and/or malice.” (SAC ¶¶ 33, 39-40.) In the third, fourth, fifth, sixth, seventh, and fourteenth causes of action, Plaintiff alleges that Defendants’ misconduct was committed “intentionally, in a malicious, fraudulent, despicable, and/or oppressive manner.” (SAC ¶¶ 51, 59, 66, 129.) As with the FAC, these causes of action do not allege specific facts of the kind of outrageous conduct supporting punitive damages. The motion to strike is granted. If Plaintiff discovers facts showing the type of conduct supporting punitive damages, he can file a motion for leave to amend the complaint.
The eleventh cause of action seeks punitive damages for unfair or fraudulent business practices under Business and Professions Code section 17200 et seq. “ ‘[N]o claim for compensatory or punitive damages can be recovered in a [UCL] action.’ ” (Zhang v. Superior Court (2013) 57 Cal.4th 364, 376, quoting State Farm Fire & Casualty Co. v. Superior Court (1996) 45 Cal.App.4th 1093, 1110.) The motion to strike is granted.
In the fifteenth cause of action, Plaintiff alleges that Defendants’ actions “constituted the very definition of malice and fraud, which of course should never be tolerated in any society, whether considered civilized or not,” and “was committed intentionally, in a malicious, fraudulent, despicable, and/or oppressive manner.” (SAC ¶¶ 137, 142.) Plaintiff does not allege specific facts of the kind of outrageous conduct supporting punitive damages. If Plaintiff discovers facts showing the type of conduct supporting punitive damages, he can file a motion for leave to amend the complaint.
Defendants also move to strike allegations relating agency and alter ego. (Motion to Strike at p. 12.) For the reasons discussed with the demurrer, the motion is denied.
The Court SUSTAINS the demurrer to the sixth and seventh causes of action with leave to amend. The Court OVERRULES the demurrer to the fifteenth cause of action.
The Court GRANTS the motion to strike portions of paragraphs 18, 23, 33, 40, 51, 59, 66, 73, 84, 110, 129, 137, 142, and Prayer paragraph 2. The Court DENIES the motion to strike paragraphs 9, 10, and 12.
Plaintiff is to file a Third Amended Complaint within 10 days.
Moving party to give notice.