Judge Audra Mori, Case 22STCV29276 2023-01-25 Tentative Ruling

Plaintiffs Ani Khachikyan, Elah Kaseblyan, a minor by and through her guardian ad litem, Ani Khachikyan; and Leah Kaseblyan, a minor by and through her guardian ad litem, Ani Khachikyan, (collectively, “Plaintiffs”), filed this action against defendants Platinum Transportation Group, Inc. (“Platinum”) and Miguel Angel Pacheco (“Pacheco”) for damages arising from a motor vehicle accident. Plaintiffs allege that defendants were hired to transport Plaintiffs, and that defendants negligently caused an accident while Plaintiffs were passengers in defendants’ vehicle. Plaintiffs further allege that Pacheco was under the influence of marijuana at the time of the accident, and that Platinum had knowledge of such of Pacheco’s history of marijuana use and still allowed him to operate the common carrier vehicle. The complaint alleges claims for (1) motor vehicle negligence, (2) general negligence, and (3) negligent hiring/training/supervision/retention. The complaint includes a prayer for punitive damages against defendants.

Defendant Platinum now moves to strike the punitive damages and the related allegations at paragraphs 12 and 19 of the complaint. Plaintiffs oppose the motion, and Platinum filed a reply.

Platinum contends that the punitive damages allegations against it are insufficient as a matter of law because the complaint merely alleges Pacheco used drugs and alcohol without any evidence of such. Platinum argues that the complaint contains only conclusory allegations against that Pacheco drove while intoxicated, and that Platinum knew Pacheco was intoxicated at the time of the accident. Further, Platinum avers that the allegations are insufficient to state a claim for punitive damages against Platinum as Pacheco’s employer because there are no factual allegations showing that Platinum authorized or ratified any alleged wrongful conduct.

In opposition, Plaintiffs argue that the complaint sufficiently states a claim for punitive damages as it alleges that Platinum had advanced knowledge of Pacheco’s long-standing marijuana use and of operating a vehicle under the influence of such. Additionally, Plaintiffs assert that Platinum was aware that its vehicle lacked a sufficient number of seatbelts to adequately protect all customers.

In reply, Platinum asserts that the Traffic Collision Report prepared regarding the accident indicates that the responding officer did not notice any alcohol or marijuana on the driver. Platinum contends that the allegations against Defendants are a sham, and that they are insufficient to plead a claim for punitive damages against Platinum because there is no factual showing of oppression, malice or fraud.

California law authorizes a party’s motion to strike matter from an opposing party’s pleading if it is irrelevant, false, or improper. (CCP §§ 435; 436(a).) Motions may also target pleadings or parts of pleadings which are not filed or drawn in conformity with applicable laws, rules or orders. (CCP § 436(b).) A motion to strike is used to address defects that appear on the face of a pleading or from judicially noticed matters that are not grounds for a demurrer. (Pierson v Sharp Memorial Hospital (1989) 216 Cal.App.3d 340, 342; see also City & County of San Francisco v Strahlendorf (1992) 7 Cal.App.4th 1911, 1913 (motion may not be based on a party's declaration or factual representations made by counsel in the motion papers).) In particular, a motion to strike can be used to attack the entire pleading or any part thereof – in other words, a motion may target single words or phrases, unlike demurrers. (Warren v. Atchison, Topeka & Santa Fe Railway Co. (1971) 19 Cal.App.3d 24, 40.) The Code of Civil Procedure also authorizes the Court to act on its own initiative to strike matters, empowering the Court to enter orders striking matter “at any time in its discretion, and upon terms it deems proper.” (CCP § 436.)

Civil Code § 3294 authorizes the recovery of punitive damages in non-contract cases “where the defendant has been guilty of oppression, fraud, or malice, express or implied . . . .” “Malice” means conduct which is intended by the defendant to cause injury to the plaintiff or despicable conduct which is carried on by the defendant with a willful and conscious disregard of the rights or safety of others. “Oppression” means despicable conduct that subjects a person to cruel and unjust hardship in conscious disregard of that person’s rights. Finally, “fraud” means an intentional misrepresentation, deceit, or concealment of a material fact known to the defendant with the intention on the party of the defendant of thereby depriving a person of property or legal rights or otherwise causing injury. (Civil Code §3294.)

Malice has long been interpreted to mean that malice in fact, as opposed to malice implied by law, is required. Malice in fact may be proved under § 3294 either expressly (by direct evidence probative on the existence of hatred or ill will) or by implication (by indirect evidence from which the jury may draw inferences). Thus, it has been held that the “malice” required by §3294 implies an act conceived in a spirit of mischief or with criminal indifference towards the obligations owed to others. Where the defendant’s wrongdoing has been intentional and deliberate and has the character of outrage frequently associated with crime, all but a few courts have permitted the jury to award in the tort action “punitive” or “exemplary” damages. Something more than the mere commission of a tort is always required for punitive damages. There must be circumstances of aggravation or outrage, such as spite or “malice,” or a fraudulent or evil motive on the part of the defendant, or such a conscious and deliberate disregard of the interests of others that his conduct may be called willful or wanton. (Taylor v. Superior Court (1979) 24 Cal. 3d 890, 894; Grieves v. Superior Court (1984) 157 Cal.App.3d 159, 166.)

Moreover, “[a]n employer shall not be liable for damages pursuant to subdivision (a), based upon acts of an employee of the employer, unless the employer 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 or authorized or ratified the wrongful conduct for which the damages are awarded or was personally guilty of oppression, fraud, or malice. With respect to a corporate employer, the advance knowledge and conscious disregard, authorization, ratification or act of oppression, fraud, or malice must be on the part of an officer, director, or managing agent of the corporation.”

“Corporations are legal entities which do not have minds capable of recklessness, wickedness, or intent to injure or deceive. An award of punitive damages against a corporation therefore must rest on the malice of the corporation's employees.” (Cruz v. HomeBase (2000) 83 Cal.App.4th 160, 167.) “ “[T]he punitive damage statute requires proof of malice among corporate leaders: the “officer[s], director[s], or managing agent [s].” [Citation.] This is the group whose intentions guide corporate conduct. By so confining liability, the statute avoids punishing the corporation for malice of low-level employees which does not reflect the corporate “state of mind” or the intentions of corporate leaders. This assures that punishment is imposed only if the corporation can fairly be viewed as guilty of the evil intent sought to be punished. “ ‘[T]o award [punitive] damages against the master for the criminality of the servant is to punish a man for that of which he is not guilty.’ ” [Citation.]” (Id.) “Managing agents” are employees who “exercise [ ] substantial discretionary authority over decisions that ultimately determine corporate policy.” (Id.)

b. Law Governing Punitive Damages in the Context of Driving Under the Influence

Civil Code § 3294(a) states, “[i]n an action for the breach of an obligation not arising from contract, where it is proven by clear and convincing evidence that the defendant has been guilty of oppression, fraud, or malice, the plaintiff, in addition to the actual damages, may recover damages for the sake of example and by way of punishing the defendant.”

Allegations that a defendant exhibited a conscious disregard for the safety of others are sufficient to show malice. (Taylor v. Superior Court (1979) 24 Cal.3d 890, 895-96.) The Taylor court concluded that the act of operating a motor vehicle while intoxicated may constitute an act of "malice" under section 3294 if performed under circumstances which disclose a conscious disregard of the probable dangerous consequences. "One who willfully consumes alcoholic beverages to the point of intoxication, knowing that he thereafter must operate a motor vehicle, thereby combining sharply impaired physical and mental faculties with a vehicle capable of great force and speed, reasonably may be held to exhibit a conscious disregard of the safety of others." (Id., at p. 897.)

To properly allege punitive damages in a motor vehicle accident action, a plaintiff needs to "establish that the defendant was aware of the probable dangerous consequences of his conduct, and that he willfully and deliberately failed to avoid those consequences." (Id., at p. 896.) If the gravamen of the complaint is that "Defendant became intoxicated and thereafter drove a car while in that condition, despite his knowledge of the safety hazard he created thereby" then this is sufficient to allege punitive damages. (Id.) While a history of prior arrests, convictions and mishaps may heighten the probability and foreseeability of an accident, we do not deem these aggravating factors essential prerequisites to the assessment of punitive damages in drunk driving cases. (Id.)

Taylor justified imposing punitive damages upon the “deliberate” drunk driver for many reasons, including the high degree of foreseeability of injury and damage flowing from driving while intoxicated. The court stated that the essential allegation is that defendant became intoxicated and thereafter drove a car while in that condition, despite his knowledge of the safety hazard he created thereby. The decision also discusses the grave havoc wrought by intoxicated drivers nationwide and equates the act of deliberately driving while under the influence with a conscious and deliberate disregard of the interests of others which may be described as willful or wanton. Such conduct, the court said, has traditionally been a basis for awarding punitive damages. (Herrick v. Superior Court (1987) 188 Cal.App.3d 787, 790.)

“There is a very commonly understood risk which attends every motor vehicle driver who is intoxicated. [Citation.] One who wilfully [sic] consumes alcoholic beverages to the point of intoxication, knowing that he thereafter must operate a motor vehicle, thereby combining sharply impaired physical and mental faculties with a vehicle capable of great force and speed, reasonably may be held to exhibit a conscious disregard of the safety of others. The effect may be lethal whether or not the driver had a prior history of drunk driving incidents.” (Taylor v. Superior Court (1979) 24 Cal.3d 890, 896-897.) “[T]he fact of common knowledge that the drinking driver is the cause of so many of the more serious automobile accidents is strong evidence in itself to support the need for all possible means of deterring persons from driving automobiles after drinking, including exposure to awards of punitive damages in the event of accidents.” (Id., at p. 897.)

Taylor fell short, however, of holding that punitive damages are always appropriate in cases involving driving while intoxicated. The Court noted, “we have concluded that the act of operating a motor vehicle while intoxicated may constitute an act of ‘malice’ under §3294 if performed under circumstances which disclose a conscious disregard of the probable dangerous consequences.” (Id. at 892.) Emphasis added.

Notably, a subsequent decision held that driving while intoxicated does not always give rise to a claim for punitive damages. “[W]e do not agree that the risk created generally by one who becomes intoxicated and decides nevertheless to drive a vehicle on the public streets is the same as the risk created by an intoxicated driver’s decision to zigzag in and out of traffic at 65 miles per hour in a crowded beach recreation area at 1:30 in the afternoon on a Sunday in June. The risk of injury to others from ordinary driving while intoxicated is certainly foreseeable, but it is not necessarily probable. The risk of injury to others from Mardian's conduct under the circumstances alleged was probable.” (Dawes v. Superior Court (1980) 111 Cal.App.3d 82.)

The court went on to note, “In contrast, in the case at bench, as previously noted, petitioners pleaded specific facts from which the conscious disregard of probable injury to others may reasonably be inferred. Justice Franson aptly noted the distinction in his article on punitive damages in vehicle accident cases: Allegations of intoxication, excessive speed, driving with defective equipment or the running of a stop signal, without more, do not state a cause of action for punitive damages. [Par.] On the other hand, if the facts show that the defendant intentionally drove his vehicle at a high speed into an intersection crowded with pedestrians, or if he drove at a high speed through a crowded residential area where children were playing in the street, a legitimate inference of actual malice perhaps could arise. This would be particularly true if the defendant had not been drinking, or, if drinking, he was not under the influence to the point where he was incapable of being aware of the situation confronting him. Under these circumstances, it reasonably might be said that the defendant acted in such an outrageous and reprehensible manner that the jury could infer that he knowingly disregarded the substantial certainty of injury to others."

Further complicating the matter, in 1987, after all of the foregoing cases were decided, the legislature amended Civil Code § 3294 to include a requirement that conduct in conscious disregard of the rights and safety of others be “despicable” in order to support imposition of punitive damages.

As an initial matter, as to Platinum’s contentions that Plaintiffs fail to submit any evidence to support the allegations made against it, Plaintiffs are not required to submit evidence to support their allegations in connection with these proceedings. In ruling on a motion to strike, the Court is limited to the four corners of the complaint and to judicially noticeable evidence. Platinum’s reference to a Traffic Collision Report filed with the reply is therefore improper. Additionally, even if the Court could consider such extrinsic evidence with the motion, which it cannot and does not, it is improper to file new evidence with reply papers as it deprives Plaintiffs of the opportunity to address the evidence in their opposition.

Defendants and each of them acted with malice and/or oppression prior to and at the time of the incident, […]. Specifically, defendant MIGUEL ANGEL PACHECO, who had a long history of marijuana use, knew before getting behind the wheel of the subject vehicle and transporting plaintiffs that he was intoxicated and impaired given his use of marijuana prior to the incident and that he was unfit to drive. Said defendant further knew that it was illegal to drive while intoxicated, and that if he were to drive while under the influence of marijuana and impaired, it was entirely probable that he would lose control of the vehicle and cause a collision with another motorist, thereby causing injury to his passengers, including the plaintiffs herein. Despite this actual knowledge, defendant purposely consumed such large amounts of marijuana with the intention of getting high and becoming impaired. Further, a strong smell of marijuana was noticeable both inside the vehicle and on defendant's person prior to the subject collision. Despite knowing he was unfit to drive, and posed a risk to others, defendant chose to operate the vehicle. In fact, prior to the collision causing injury to plaintiffs, defendant drove so erratically with plaintiffs in the vehicle that he nearly caused three other accidents until causing the subject collision in this case. Defendant nevertheless continued to operate the vehicle at unsafe speeds and in an erratic manner resulting in the collision giving rise to this action…

Moreover, and with respect to defendants PLATINUM TRANS GRP, INC. LSR and Does 1 through 20, and each of them, said defendants had advance knowledge of co-defendant MIGUEL ANGEL PACHECO' s longstanding use of marijuana and operating a motor vehicle while under the influence of marijuana, significantly impaired, and otherwise unfit to safely act as a common carrier and transport persons for hire. Despite such knowledge, defendants and each of them knowingly and willfully hired and retained defendant MIGUEL ANGEL PACHECO and allowed him to operate the common carrier vehicle, all in conscious disregard of the safety and rights of their passenger customers and clients, including the plaintiffs herein. Said knowledge, authorization and/or ratification by defendants was carried on by one or more of their officers, directors and managing agents. Furthermore, defendants PLATINUM TRANS GRP, INC. LSR and Does 1 through 20, and each of them, were aware that their vehicle lacked a sufficient number of seatbelts and restraints to adequately protect all passengers, including the plaintiffs, but knowingly and willfully used such vehicle to transport plaintiffs in conscious disregard of the safety and rights of their passenger customers and clients, including the plaintiffs herein. Said knowledge, authorization and/or ratification by defendants was carried on by one or more of their officers, directors and managing agents.

Plaintiffs, thus, allege that Pacheco, before driving Platinum’s vehicle, was under the influence of marijuana and drove erratically with Plaintiffs in the vehicle, including driving at unsafe speeds. However, there are insufficient factual allegations showing a conscious and deliberate disregard of the safety of others. Further, there are no factual allegations against Pacheco demonstrating any despicable conduct that subjected Plaintiffs to cruel and unjust hardship in conscious disregard of Plaintiffs’ rights, or any allegations showing Pacheco’s driving at the time of the accident equates to outrageous or extreme conduct. The complaint’s conclusory allegations that Pacheco was under the influence of marijuana and drove erratically are insufficient to support a request for punitive damages. (Brousseau v. Jarrett (1977) 73 Cal.App.3d 864, 872 [“the second count's conclusory characterization of defendant's conduct as intentional, willful and fraudulent is a patently insufficient statement of "oppression, fraud, or malice, express or implied."].) The allegation that Pacheco drove under the influence is insufficient without more to state a claim for punitive damages. If it were, it would essentially mean anyone driving under the influence would be subject to punitive damages.

Furthermore, Plaintiffs merely allege in a conclusory manner regarding Pacheco’s unfitness and driving of the vehicle, “[s]aid knowledge, authorization and/or ratification by defendants was carried on by one or more of their officers, directors and managing agents.” (Compl. ¶ 12.) Plaintiffs must plead facts with particularity regarding the alleged advanced knowledge, authorization, and ratification on the part of an officer, director, or managing agent of the corporation. (Civ. Code, § 3294(b).) Lastly regarding the claims that Platinum lacked the number of seatbelts to protect all passengers, Plaintiffs do not allege how the alleged lack of seatbelts contributed to Plaintiffs’ injuries, or how such was ratified or authorized by Platinum’s officers, directors, or managing agents. (See Dawes v. Superior Court (1980) 111 Cal.App.3d 82, 90 [noting, “’[A]llegations of intoxication, excessive speed, driving with defective equipment or the running of a stop signal, without more, do not state a cause of action for punitive damages.’”].)

The burden is on Plaintiffs to show in what manner they can amend the complaint, and how that amendment will change the legal effect of the pleading. (Goodman v. Kennedy (1976) 18 Cal.3d 335, 349; Hendy v. Losse (1991) 54 Cal.3d 723, 742.) Plaintiffs request leave to amend, and given Plaintiffs assertions about the incident, the Court thus finds there is a reasonable probability the complaint can be amended to state a claim for punitive damages.

Hon. Audra Mori

Judge of the Superior Court