Judge: Barbara M. Scheper, Case: 22STCV22993, Date: 2023-01-23 Tentative Ruling
Case Number: 22STCV22993 Hearing Date: January 23, 2023 Dept: 30
Dept.
30
Calendar
No.
Kwasha
vs. JPMorgan Chase Bank, NA, et. al., Case No. 22STCV22993
Tentative
Ruling re: Defendant’s Demurrer to
Second Amended Complaint’ Motion to Strike
Defendant JP Morgan Chase Bank, N.A. (Chase) demurs to the Second Amended Complaint (SAC) of
Plaintiff Linda Kwasha (Plaintiff). The demurrer is sustained without leave to
amend. The motion to strike is denied as moot.
In reviewing the legal sufficiency of a complaint against a
demurrer, a court will treat the demurrer as admitting all material facts
properly pleaded, but not contentions, deductions, or conclusions of law. (Blank
v. Kirwan (1985) 39 Cal.3d 311, 318 (Blank); C & H Foods Co.
v. Hartford Ins. Co. (1984) 163 Cal.App.3d 1055, 1062.) It is well settled
that a “demurrer lies only for defects appearing on the face of the
complaint[.]” (Stevens v. Superior Court (1999) 75 Cal.App.4th 594,
601.) “The rules by which the sufficiency of a complaint is tested against a
general demurrer are well settled. We not only treat the demurrer as admitting
all material facts properly pleaded, but also give the complaint a reasonable
interpretation, reading it as a whole and its parts in their context.” (Guclimane Co. v.
Stewart Title Guaranty Co. (1998) 19 Cal.4th 26, 38 (internal quotes
omitted).) For purposes of ruling on a demurrer, the complaint must be
construed liberally by drawing reasonable inferences from the facts pleaded. (Wilner
v. Sunset Life Ins. Co. (2000) 78 Cal.App.4th 952, 958.)
When ruling on a demurrer, the Court may only consider the
complaint’s allegations or matters which may be judicially noticed. (Blank,
supra, 39 Cal.3d at p. 318.) The Court may not consider any other extrinsic
evidence or judge the credibility of the allegations plead or the difficulty a
plaintiff may have in proving his allegations. (Ion Equip. Corp. v. Nelson
(1980) 110 Cal.App.3d 868, 881.) A demurrer is properly sustained only when the
complaint, liberally construed, fails to state facts sufficient to constitute
any cause of action. (Kramer v. Intuit Inc. (2004) 121 Cal.App.4th 574,
578.)
Plaintiff alleges that in July 2008, she entered into a
written agreement with Washington Mutual Bank (WaMu) to rent a safe deposit box
at its branch located in Studio City, California. (SAC ¶ 6.) WaMu had one box
numbered 100510, and another numbered 510; it is alleged that WaMu rented
Plaintiff the box numbered 100510, but recorded in its records that Plaintiff
was rented box 510. Plaintiff placed her diamond jewelry in box 100510, though
Plaintiff was told that she was putting the items in box number 510. (Ibid.)
WaMu was purchased by Chase on September 25, 2008. (SAC ¶ 7.) In October 2010,
Plaintiff decided that she would not wear the diamond jewelry and so cancelled
insurance for it, based on the belief that the jewelry was secured in the safe
deposit box. (SAC ¶ 8.)
On September 8, 2021, Plaintiff emailed Defendant Michelle
Raigoza née Rivas (Rivas), the manager of Chase’s Studio City branch, regarding
the status of box number 510. The following day, Rivas told Plaintiff over the
telephone that there was no safe deposit box at the branch under Plaintiff’s or
her daughter’s names or social security numbers. (SAC ¶ 11.) In fact, Chase’s
customer profile for Plaintiff at the time showed that box number 510 was
rented to Plaintiff, though Rivas testified at her deposition on November 9,
2022, that she was not able to access that profile. (SAC ¶ 10.)
Plaintiff arranged to visit the bank in person on September
13, 2021. On that date, Plaintiff drove to the bank accompanied by her
significant other, Gato Grossman. (SAC ¶ 12.) Rivas called Plaintiff’s cell
phone while Plaintiff was on her way to the bank with Grossman, and Plaintiff
answered the call via her car speakerphone. Rivas told Plaintiff that “on
December 27, 2010, the plaintiff had come into the Studio City Branch, claimed
she had lost her keys to the Safe Deposit Box, had the box drilled open, was
given the contents of the Safe Deposit Box, and closed the account." (Ibid.)
Plaintiff, shocked and astounded, denied Rivas’s account, but Rivas remained
adamant that Plaintiff had accessed the box and removed the property within.
(SAC ¶ 13.) Plaintiff understood Rivas to be accusing Plaintiff of lying and
attempting to commit bank fraud. (SAC ¶ 14.) When Plaintiff arrived at the
branch, she was told by an employee that Rivas would get back in touch with
Plaintiff at a later time. (SAC ¶ 16.) A few days later, Rivas called Plaintiff
and told her that someone “higher up” would contact Plaintiff, though no one
from Chase ever did contact Plaintiff. (SAC ¶¶ 16-17.)
In May 2022, two employees conducting an audit of the
Studio City Branch’s records found that there was no contract for the renting
of box 100510 and no keys for that box. The employees subsequently drilled open
the box, then removed and inventoried its contents. Chase later determined that
this box was the one rented to Plaintiff, and returned the property contained within
to Plaintiff. (SAC ¶ 22.)
First Cause of Action for
Defamation
“The elements of a defamation claim are (1) a publication
that is (2) false, (3) defamatory, (4) unprivileged, and (5) has a natural
tendency to injure or causes special damage.” (See Wong v. Tai Jing
(2010) 189 Cal.App.4th 1354, 1369.)
“If a
defamatory meaning appears from the language itself without the necessity of
explanation or the pleading of extrinsic facts, there is libel per se.” (Palm
Springs Tennis Club v. Rangel (1999) 73 Cal.App.4th 1, 5.)
“Where the words or
other matters which are the subject of a defamation action are of ambiguous
meaning, or innocent on their face and defamatory only in the light of
extrinsic circumstances, the plaintiff must plead and prove that as used, the
words had a particular meaning, or ‘innuendo,’ which makes them defamatory.
[Citations.] Where the language at issue is ambiguous, the plaintiff must also
allege the extrinsic circumstances which show the third person reasonably
understood it in its derogatory sense (the ‘inducement’). [Citations.]” (Smith
v. Maldonado (1999) 72 Cal.App.4th 637, 646.) “An innuendo, however, cannot
ascribe a meaning to assertedly defamatory matter other or broader than the
words themselves naturally bear; it cannot add to, enlarge, or change the sense
of the published words. (Emde v. San Joaquin County Central Labor Council
(1943) 23 Cal.2d 146, 159–160.) “The question whether a statement is reasonably
susceptible to a defamatory interpretation is a question of law for the trial
court.” (Maldonando, 72 Cal.App.4th. at 647.)
“The charge may be
that the plaintiff has been guilty of an act of dishonesty, or that plaintiff
has some particular defect of character.” (5 Witkin, Summary of Cal. Law (11th
ed. 2022) Torts § 640.) False accusations of crime are defamatory per se. (See Weinberg
v. Feisel (2003) 110 Cal.App.4th 1122, 1136 [discussing libel]; 5 Witkin,
Summary of Cal. Law (11th ed. 2022) Torts § 639.)
Plaintiff’s
defamation claim is based on Rivas’s alleged statements, made over Plaintiff’s
car speakerphone, that Plaintiff had come to the branch in December 2010,
claimed she lost her keys to the box, had the box drilled open, removed the
contents, then closed the account. (SAC ¶¶ 12-13.)
As an
initial matter, Plaintiff’s allegations that “Rivas’s
accusations were slanderous in that they clearly conveyed the message that the
plaintiff was lying. . . and was attempting to commit bank fraud by
extorting money from Chase for the value of
the supposedly lost property,” and that this was “how any normal person would
interpret the accusations” are conclusions of law and may not be relied
upon. (SAC ¶ 14.) Furthermore, for purposes of demurrer, Plaintiff may not rely
upon the statements in the declaration of her counsel citing evidence and
purported facts not pled in the SAC. When ruling on a
demurrer, the Court may only consider the complaint’s allegations or matters
which may be judicially noticed. (Blank, supra, 39 Cal.3d at p. 318.)
As the
Court previously found, Rivas’s statements are not reasonably susceptible to a
defamatory interpretation. First, they are not defamatory per se, as Rivas did
not accuse Plaintiff of any crime, and no defamatory meaning appears from the
language of the alleged statement itself.
The statements
are also not defamatory in the light of the alleged extrinsic circumstances. Plaintiff
argues that Rivas’s statement, in context, may be reasonably interpreted as
accusing Plaintiff of being a liar who was attempting to commit fraud against
the bank. The Court disagrees. The alleged fact that Plaintiff strenuously denied
Rivas’s incorrect account of the withdrawal does not reasonably transform that
account into an insinuation that Plaintiff was a liar attempting to commit bank
fraud. There are no allegations that Rivas accused Plaintiff of being dishonest
in her denial (i.e., of denying the statements despite knowing that she did, in
fact, withdraw the contents of the box in 2010), or of wrongfully seeking to
gain a financial benefit from Chase. Disagreement on a fact is not equivalent
to an accusation of lying, and the extrinsic fact of Plaintiff’s denial “cannot add to, enlarge, or change the sense of the
published words.” (Emde, 23 Cal.2d at 159.) The meaning that Plaintiff
seeks to ascribe to Rivas’s statements goes significantly beyond the sense of
the alleged words themselves, and so the allegations fail to show that a “third
party reasonably understood [the statement] in its derogatory sense.” (Maldonando,
72 Cal.App.4th. at 646.) Accordingly, the demurrer is sustained as to
the first cause of action.
Second
Cause of Action for Negligence
Plaintiff’s second cause of action
for negligence is premised on WaMu’s alleged failure to accurately record the
renting of Plaintiff’s safe deposit box and failure to maintain proper records
regarding which box was rented to Plaintiff. (SAC ¶ 26.) Plaintiff’s alleged
damages are for attorney’s fees incurred in filing a prior suit against Chase
in Los Angeles Superior Court (Case No. 21STCV41742),
as well as “extreme physical and emotional distress,” including “dizziness,
transient visual phenomena or visual field
scotoma of both eyes, sleeplessness, and an increase in her blood pressure.”
(SAC ¶¶ 27-28.) Plaintiff “consulted medical specialists and underwent several tests
and medical procedures, including an MRA/MRI
brain scan,” and was prescribed medications for stress, sleeping, and anxiety.
(SAC ¶ 28.) Plaintiff seeks to hold Chase liable for WaMu’s negligence based on
Chase’s acquisition of WaMu. (SAC ¶ 29.)
The Court first considers Chase’s argument
that it lacks subject matter jurisdiction over Plaintiff’s negligence claim
under the Financial Institution Reform, Recovery and Enforcement Act of 1989, 12 U.S.C. § 1811, et seq.
(FIRREA).
“Under FIRREA, the FDIC has ‘authority to act as receiver
or conservator of a failed institution for the protection of depositors and
creditors.’ [Citation.] [FIRREA] provides detailed procedures to allow the FDIC
to consider certain claims against the receivership estate, [Citation] ‘to
ensure that the assets of a failed institution are distributed fairly and
promptly among those with valid claims against the institution, and to
expeditiously wind up the affairs of failed banks… FIRREA requires that a
plaintiff exhaust these administrative remedies with the FDIC before filing
certain claims.’” (Saffer v. JP Morgan Chase Bank, N.A. (2014) 225
Cal.App.4th 1239, 1246.)
Once the
FDIC is appointed receiver of a failed institution, it is required to publish
notice to the institution’s creditors that claims must be presented to the
receiver by a specified date, called the “bar date.” (Id. at 1247.) With certain
exceptions, claims filed after the bar date “shall be disallowed and such
disallowance shall be final.” (12 U.S.C. § 1821, subd. (d)(5)(C).) The
exceptions are where “the claimant did not receive notice of the appointment of
the receiver in time to file such claim before such date,” and where “such
claim is filed in time to permit payment of such claim.” (Ibid.)
The failure to exhaust FIRREA
administrative remedies deprives courts of subject matter jurisdiction. (Id. at 1248.) Under 12 U.S.C. § 1821, subd. (d)(13)(D), “Except as
otherwise provided in this subsection, no court shall have jurisdiction
over—[¶] (i) any claim or action for payment from, or any action seeking a
determination of rights with respect to, the assets of any depository
institution for which the Corporation has been appointed receiver, including
assets which the Corporation may acquire from itself as such receiver; or [¶]
(ii) any claim relating to any act or omission of such institution or the
Corporation as receiver.” “Thus, ‘[f]ailure to comply with the claims procedure
bars any lawsuit against a failed depository institution.’” (Saffer, 225
Cal.App.4th at 1247.)
FIRREA “bars judicial
review of any non-exhausted claim, monetary or nonmonetary, which is
‘susceptible of resolution through the claims procedure.’” (Saffer at
1253 [quoting Henderson v. Bank of New England (9th Cir.1993) 986 F.2d
319, 321].) “Courts have concluded that claims of varying subject matters
required FIRREA exhaustion, including employment-related claims, so long as
they were claims relating to the acts or omissions of a failed depository
institution over which the FDIC was appointed receiver.” (Id. at 1254.)
The Court agrees with Chase that Plaintiff’s negligence
claim is subject to FIRREA, and that Plaintiff must therefore satisfy FIRREA’s
exhaustion requirement before the Court may obtain subject matter jurisdiction
over the claim. As here, Saffer involved a plaintiff who sought to bring
monetary claims against JP Morgan Chase Bank, N.A., which “exclusively
concerned the prereceivership acts of the failed bank, WaMu.” (Id. at
1253.) Those claims were subject to FIRREA, and because the plaintiff had not
satisfied the exhaustion requirements, the court found that it lacked subject
matter jurisdiction. (Id. at 1262-63.) Plaintiff has provided no reason
why that reasoning would not also apply to her negligence claim based on WaMu’s
pre-receivership conduct.
Plaintiff argues that FIRREA is inapplicable
because no claim existed at the time of WaMu’s failure, as Chase had not yet
refused to return Plaintiff’s property. But as pled, Plaintiff’s negligence
claim is premised on WaMu’s alleged failure “to accurately
record the renting of a safe deposit box to
the plaintiff and to maintain proper records reflecting which safe deposit box
was rented to the plaintiff to ensure she
could access the correct box and retrieve her property.” (SAC ¶ 26.) WaMu’s
negligent conduct is alleged to have taken place in July 2008, prior to the
FDIC’s receivership. (SAC ¶¶ 6, 26.)
On similar grounds, Plaintiff also argues that
her claim is subject to the exception for claims where “the claimant did not
receive notice of the appointment of the receiver in time to file such claim
before such date.” (12 U.S.C. § 1821, subd. (d)(5)(C).) This exception refers
to the claimant’s notice of the receivership, not her knowledge of her claim. A
claimant’s notice of the receivership may be satisfied based on inquiry notice;
for instance, the court in Saffer found that the plaintiff had inquiry
notice of the FDIC’s receivership over WaMu based on the FDIC’s published
notice in the Wall Street Journal “on at least two occasions at the beginning
and end of October 2008.” (Saffer at 1259.) Plaintiff’s knowledge
argument was rejected in Potter v. JPMorgan Chase Bank, N.A., (C.D.
Cal., May 8, 2013) 2013 WL 1912718, in which the court found, “the statutory
text does not support a rule based on a claimant's knowledge. If a plaintiff's
claim has accrued prior to the claims bar date, then it has accrued ‘in time
[for the plaintiff] to file such claim,’ even if the plaintiff lacks knowledge
of the claim.” (Id. at *8.) Thus, the proper inquiry is “whether a claim
arises out of pre-bar date events or post-bar dates events.” (Id. at
*9.)
Because Plaintiff’s negligence claim is based
on conduct alleged to have occurred in July 2008, prior to the December 2008
bar date for WaMu (See Saffer at 1262), it is subject to FIRREA’s
administrative exhaustion requirement. Plaintiff has not satisfied those
requirements, and so the Court lacks subject matter jurisdiction over her
negligence claim. Accordingly, the demurrer is sustained
as to the second cause of action.
The
motion to strike is denied as moot.