Judge Christopher K. Lui, Case 20STCV41226 2023-04-18 Tentative Ruling

Pursuant to California Rule of Court 3.1308(a)(1), the Court does not desire oral argument on the demurrer and motion addressed herein. As required by Rule 3.1308(a)(2), any party seeking oral argument must notify ALL OTHER PARTIES and the staff of Department 76 of their intent to appear and argue. Notice to Department 76 may be sent by email to smcdept76@lacourt.org or telephonically at 213-830-0776. If notice of intention to appear is not given and the parties do not appear, the Court will adopt the tentative ruling as the final ruling.

The motion to strike the punitive damage allegations at Page 23, lines 13, subpart 6 of the 1AC is GRANTED with leave to amend.

The demurrer to the second cause of action is SUSTAINED with leave to amend.

The Declaration of Scott Hancox reflects that Defendant’s counsel satisfied the meet and confer requirement set forth in CCP § 430.41.

Defendant American Honda Motor Co., Inc. demurs to the First Amended Complaint as follows:

Defendant argues that the 1AC does not establish that Defendant omitted a material fact that was contrary to a material representation made to Plaintiffs.

60. AMERICAN HONDA drafted, produced, and distributed marketing materials to the public containing factual representations about the Subject Vehicle. Prior to purchasing the Subject Vehicle, Plaintiffs reviewed marketing brochures, viewed television commercials and/or heard radio commercials about the qualities of the 2018 Honda Odyssey.

[T]he elements of a cause of action for fraud based on concealment are: “ ‘(1) the defendant must have concealed or suppressed a material fact, (2) the defendant must have been under a duty to disclose the fact to the plaintiff, (3) the defendant must have intentionally concealed or suppressed the fact with the intent to defraud the plaintiff, (4) the plaintiff must have been unaware of the fact and would not have acted as he did if he had known of the concealed or suppressed fact, and (5) as a result of the concealment or suppression of the fact, the plaintiff must have sustained damage. [Citation.]’ [Citation.]” (Citation omitted.)

(Kaldenbach v. Mutual of Omaha Life Ins. Co. (2009) 178 Cal.App.4th 830, 850.)

“There are ‘four circumstances in which nondisclosure or concealment may constitute actionable fraud: (1) when the defendant is in a fiduciary relationship with the plaintiff; (2) when the defendant had exclusive knowledge of material facts not known to the plaintiff; (3) when the defendant actively conceals a material fact from the plaintiff; and (4) when the defendant makes partial representations but also suppresses some material facts. [Citation.]’ ” (Citations omitted.) Where, as here, there is no fiduciary relationship, the duty to disclose generally presupposes a relationship grounded in “some sort of transaction between the parties. [Citations.] Thus, a duty to disclose may arise from the relationship between seller and buyer, employer and prospective employee, doctor and patient, or parties entering into any kind of contractual agreement. [Citation.]” (Citation omitted.)

(OCM Principal Opportunities Fund, L.P. v. CIBC World Markets Corp. (2007) 157 Cal.App.4th 835, 859 [bold emphasis added].)

Fraud causes of action must be pled with specificity. (Hills Transportation Co. v. Southwest Forest Ind., Inc. (1968) 266 Cal.App.2d 702, 707.) The complaint must allege facts as to “‘how, when, where, to whom, and by what means the representations were tendered.’" (Stansfield v. Starkey (1990) 220 Cal.App.3d 59, 73.) “The requirement of specificity in a fraud action against a corporation requires the plaintiff to allege the names of the persons who made the allegedly fraudulent representations, their authority to speak, to whom they spoke, what they said or wrote, and when it was said or written. (Citations omitted.)” (Tarmann v. State Farm Mut. Auto. Ins. Co. (1991) 2 Cal.App.4^th 153, 157.)

Less specificity is required to plead fraud by concealment. (Jones v. ConocoPhillips Co. (2011) 198 Cal.App.4th 1187, 1199.) However, “[i]f a fraud claim is based upon failure to disclose, and ‘the duty to disclose arises from the making of representations that were misleading or false, then those allegations should be described.’ (Citation omitted.)” (Morgan v. AT&T Wireless Services, Inc. (2009) 177 Cal.App.4th 1235, 1262.)

Plaintiffs must plead more specificity as to when, if at all, Plaintiffs were exposed to Defendant’s marketing materials and exactly what statements were made in the materials upon which Plaintiffs relied. Plaintiffs are required to allege statements which would constitute, at the very least, half-truths if not outright misrepresentations as to the subject vehicle, and actual reliance upon such statements. If Plaintiffs never relied on any statements by Defendant, there was never an opportunity for Defendant to disclose material facts to Plaintiffs.

Civil Code § 1710(3)(deceit is defined to include “[t]he suppression of a fact, by one who is bound to disclose it, or who gives information of other facts which are likely to mislead for want of communication of that fact. . . .”)(bold emphasis added).

In a misleading half-truth situation, where the defendant undertakes to provide some information, the defendant is “obliged to disclose all other facts which ‘materially qualify’ the limited facts disclosed. (Citations omitted.)” (Randi W. v. Muroc Joint Unified School Dist. (1997) 14 Cal.4th 1066, 1082.)

Because Plaintiffs have not pled fraud with sufficient specificity, the Court declines to address Defendant’s additional arguments.

The Declaration of Scott Hancox reflects that Defendant’s counsel satisfied the meet and confer requirement set forth in CCP § 435.5.

The motion to strike the punitive damage allegations at Page 23, lines 13, subpart 6 of the 1AC is GRANTED with leave to amend.

For the reasons discussed above re: the demurer, Plaintiffs have not sufficiently pled fraud.

Moreover, although it appears that punitive damages are available as to the Song-Beverly Act claims (Johnson v. Ford Motor Co. (2005) 135 Cal.App.4th 137, 141, 143), so long as they are not awarded for the same acts for which a civil penalty is recovered (Troensegaard v. Silvercrest Indus. (1985) 175 Cal.App.3d 218, 228.), Plaintiffs have not pled malice, oppression or fraud[1] in connection with the Song-Beverly Act violations.

[1]

(1) “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.

(2) “Oppression” means despicable conduct that subjects a person to cruel and unjust hardship in conscious disregard of that person’s rights.

(3) “Fraud” means an intentional misrepresentation, deceit, or concealment of a material fact known to the defendant with the intention on the part of the defendant of thereby depriving a person of property or legal rights or otherwise causing injury.

(Civ. Code, § 3294 (Deering).)