Judge: Armen Tamzarian, Case: 23STCV05874, Date: 2023-08-18 Tentative Ruling

Case Number: 23STCV05874    Hearing Date: August 18, 2023    Dept: 52

Defendants Akdok, Inc. and Akdok, LLC’s Demurrer and Motion to Strike

Demurrer

Defendants Akdok, Inc. and Akdok, LLC demur to both causes of action alleged by plaintiffs Antonio Vincenzo Silletti, Maziyar Hassanpour, and Steven James Emery Gonzalez.

Employer/Employee Relationship

            Plaintiffs allege two causes of action: (1) wrongful termination in violation of public policy, and (2) wrongful termination in violation of Labor Code section 1102.5.  Both require that defendants employed plaintiffs.  (Miklosy v. Regents of University of California (2008) 44 Cal.4th 876, 901 [a “cause of action for wrongful termination in violation of public policy lies only against an employer”]; Lawson v. PPG Architectural Finishes, Inc. (2022) 12 Cal.5th 703, 709 [“section 1102.5 prohibits an employer from retaliating against an employee”].)

Defendants argue plaintiffs have not alleged sufficient facts to show they were defendants’ employees.  On demurrer, courts liberally construe the complaint and draw “inferences favorable to the plaintiff, not the defendant.” (Perez v. Golden Empire Transit Dist. (2012) 209 Cal.App.4th 1228, 1238.)  Courts also “give the complaint a reasonable interpretation by reading it as a whole.”  (Moore v. Regents of University of California (1990) 51 Cal.3d 120, 125.)  When doing so, the complaint alleges sufficient facts to show defendants Akdok, Inc. and Akdok, LLC employed each plaintiff. 

The complaint alleges Akdok, Inc. and Akdok, LLC each “do[] business as Audi Valencia.”  (¶¶ 4, 5.)  It further alleges, “Plaintiff and the aggrieved employees worked as sales capacities [sic] for Defendants.”  (¶ 9.)  The complaint alleges plaintiff Silletti “was terminated” for pretextual reasons.  (¶ 28.)  It also alleges plaintiff Hassanpour was “the general manager” (¶ 29) and “was terminated under the false pretext that he was dishonest” (¶ 31).  Finally, it alleges plaintiff Gonzalez “was constructively terminated” and that various circumstances made it so that “he could not do his job properly.”  (¶ 32.) 

Though the complaint has minor inconsistencies, its gravamen is clear: all three plaintiffs worked for all defendants (Akdok, Inc., Akdok, LLC, and Does 1-100) at an auto dealer, Audi Valencia. 

2nd Cause of Action for Whistleblower Retaliation

            Each plaintiff alleges sufficient facts for this cause of action.  Labor Code section 1102.5, subdivision (b) prohibits an employer from retaliating against an employee for reporting information that “the employee has reasonable cause to believe … discloses a violation of state or federal statute, or a violation of or noncompliance with a local, state, or federal rule or regulation.” 

            Defendants correctly note that, in the factual allegations specific to each plaintiff, the complaint only alleges Silletti complained that defendants did something illegal.  The complaint alleges, “Silletti complained to Defendants about illegally running credit since Defendants did not obtain permission to do so, and about the payment packing.”  (¶ 28.)  As for Hassanpour, the complaint alleges, “Hassanpour complained about the dealership’s advertising budget and methods” (¶ 29) and questioned defendants about “why El Famosisimo,” who does marketing on social media, “was paid around $100,000 per month” (¶ 30).  And for Gonzalez, the complaint alleges he “was constructively terminated because with all the consumers coming to the dealership and getting taken advantage of as described above, as a result of El Famosisimo’s advertising . . . the regular Audi customers felt uncomfortable, and he could not do his job properly.”  (¶ 32.) 

            The complaint, however, also makes allegations common to all plaintiffs.  It alleges, “Civil Code section 1632 . . . provides that when a contract is negotiated in a language other than English, the consumer must be given a copy of the contract that the language was negotiated in.”  (¶ 36.)  “[T]he consumers who came to Defendants as a result of El Famosisimo’s advertising were Spanish speakers, but Defendants did not provide documents in Spanish.”  (¶ 37.)  “When Plaintiffs complained about Defendants’ violations of the above public policies,” including violation of Civil Code section 1632, “they were wrongfully terminated.”  (¶ 41.)  The complaint further alleges, “Plaintiffs complained about the above statutory violations, which included Civil Code 1632,” among others, “and as a result they were wrongfully terminated.”  (¶ 47.)

            Despite the dearth of specific factual allegations about each plaintiff’s complaints in paragraphs 28 to 33, the complaint’s other allegations in paragraphs 36 to 47 cure any defect.  When liberally construed and read as a whole, the complaint alleges each of the three plaintiffs complained to defendants about each of the violations of law discussed in the complaint, and defendants terminated them in retaliation for those complaints.

Motion to Strike

            Defendants Akdok, Inc. and Akdok, LLC move to strike the complaint’s allegations related to punitive damages.  Courts may strike such allegations where the facts alleged “do not rise to the level of malice, oppression or fraud necessary” to recover punitive damages under Civil Code section 3294.  (Turman v. Turning Point of Central California, Inc. (2010) 191 Cal.App.4th 53, 64.)  Conclusory allegations are not enough.  (Smith v. Superior Court (1992) 10 Cal.App.4th 1033, 1042.)  The complaint must make “factual assertions supporting a conclusion [defendants] acted with oppression, fraud or malice.”  (Ibid.)

            Plaintiffs allege sufficient facts for malice or oppression.  “[W]illfully and consciously retaliat[ing] against” employees for exercising their rights can constitute malicious or oppressive conduct sufficient for punitive damages.  (Colucci v. T-Mobile USA, Inc. (2020) 48 Cal.App.5th 442, 455.)  The complaint alleges defendants willfully retaliated against plaintiffs for exercising their rights to report violations of law.  (¶¶ 36-41.)

Defendants argue the complaint fails to allege sufficient facts to make business entities liable for punitive damages.  Civil Code section 3294, subdivision (b) provides that for a corporate employer to be liable for punitive damages, “the advance knowledge and conscious disregard [of an employee’s unfitness], authorization, ratification or act of oppression, fraud, or malice must be on the part of an officer, director, or managing agent of the corporation.”  The complaint alleges “the employee who wrongfully terminated Plaintiffs . . . was Shariq Khan (an officer of Defendants as the acting vice president).”  (¶ 44.)  Plaintiffs thus allege the oppressive or malicious conduct was personally done by an officer of Akdok, Inc. and Akdok, LLC.

Disposition

Defendants Akdok, Inc. and Akdok, LLC’s demurrer to the complaint by plaintiffs Antonio Vincenzo Silletti, Maziyar Hassanpour, and Steven James Emery Gonzalez is overruled. 

Defendants’ motion to strike portions of the complaint is denied.

Defendants Akdok, Inc. and Akdok, LLC are ordered to answer within 20 days.