Superior Court of California 

County of Los Angeles – West District  

Beverly Hills Courthouse / Department 205 

 

 

MOVING PARTY: Defendant Jordan Mack d/b/a Brilliant Notion 

 

RESPONDING PARTY: Plaintiff Darrell Survey Company 

 

BACKGROUND 

This is a breach of contract case.  Plaintiff Darrell Survey Company is a leading provider of data on golf equipment.  (Second Amended Complaint (“SAC”) ¶ 1.)  In 2014, it developed a plan to use the data it collected plus data purchased through third party sources to build an interactive website called Darrell Analytics.  (SAC ¶ 16).  In 2016, Plaintiff entered into an “implied in fact oral agreement” with Defendant Jordan Mack to help build the site.  (SAC ¶ 3.)  The parties agreed on a payment plan of four installments totaling $60,000.  (SAC ¶ 4.)  

In September 2018, Defendant stopped work on the project and refused to return the data it obtained from Plaintiff, to provide Plaintiff with access to the website, and to make any further changes to fix the site.  (SAC ¶ 5.)  Defendant demanded a lump sum payment of $200,000, holding Plaintiff’s website and data hostage.  (SAC ¶ 6.)  It was not until March 2019 that Mack returned access to Plaintiff’s proprietary data and website.  (SAC ¶ 6.)  By then, Plaintiff’s relations with prospective clients, to whom Plaintiff had pitched the concept of the website, had been severely damaged.  (SAC ¶ 6.)   

The operative (second amended) complaint alleges nine causes of action for (1) breach of contract, (2) breach of the implied covenant of good faith and fair dealing, (3) conversion, (4) intentional interference with contractual relations, (5) intentional interference with prospective economic advantage, (6) negligent interference with prospective economic relations, (7) negligent misrepresentation, (8) violation of the Bus. & Prof. Code § 17200, et seq., and (9) injunctive relief. 

The Court previously sustained a demurrer on Plaintiff’s first amended complaint (“FAC”), with leave to amend except as to two claims (for declaratory relief and unjust enrichment).  The Court concluded Plaintiff failed to allege the terms of the contract, and “Plaintiff appears to have converted a breach of contract claim into eleven insufficiently pled claims.”       

This hearing is on Defendant’s demurrer on grounds that Plaintiff’s SAC is not materially different than its FAC, and demurrer should be sustained on the same grounds as the Court’s prior ruling.  Further, Defendant argues that Plaintiff should not be given leave to amend its Complaint for the fourth time.   

LEGAL STANDARD 

“[A] demurrer tests the legal sufficiency of the allegations in a complaint.” (Lewis v. Safeway, Inc. (2015) 235 Cal.App.4th 385, 388.)  A demurrer can be used only to challenge defects that appear on the face of the pleading under attack or from matters outside the pleading that are judicially noticeable.  (See Donabedian v. Mercury Ins. Co. (2004) 116 Cal.App.4th 968, 994 (in ruling on a demurrer, a court may not consider declarations, matters not subject to judicial notice, or documents not accepted for the truth of their contents).)  For purposes of ruling on a demurrer, all facts pleaded in a complaint are assumed to be true, but the reviewing court does not assume the truth of conclusions of law. (Aubry v. Tri-City Hosp. Dist. (1992) 2 Cal.4th 962, 967.)  

Special demurrers for uncertainty are disfavored and are only granted where the complaint is so unintelligible that the defendant cannot reasonably respond.  (Williams v. Beechnut Nutrition Corp. (1986) 185 Cal.App.3d 135, 139 (“[W]here the complaint contains substantive factual allegations sufficiently apprising defendant of the issues it is being asked to meet, a demurrer for uncertainty should be overruled or plaintiff given leave to amend.”); see also Weil & Brown, Cal. Practice Guide: Civ. Proc. Before Trial (The Rutter Group 2018 ed.) 117:84 to 7:88.)  The favored approach is to clarify theories in the complaint through discovery. (See Khoury v. Maly's of Calif., Inc. (1993) 14 Cal.App.4th 612, 616.)  A defendant demurring to a complaint on grounds of uncertainty has an obligation to specify the particulars of the complaint that are uncertain. (See Fenton v. Groveland Comm. Servs. Dist. (1982) 135 Cal.App.3d 797, 809.) 

Leave to amend must be allowed where there is a reasonable possibility of successful amendment. (See Goodman v. Kennedy (1976) 18 Cal.3d 335, 349 (court shall not “sustain a demurrer without leave to amend if there is any reasonable possibility that the defect can be cured by amendment”); Kong v. City of Hawaiian Gardens Redevelopment Agency (2002) 108 Cal.App.4th 1028, 1037 (“A demurrer should not be sustained without leave to amend if the complaint, liberally construed, can state a cause of action under any theory or if there is a reasonable possibility the defect can be cured by amendment.”).)  The burden is on the complainant to show the Court that a pleading can be amended successfully. (Blank v. Kirwan (1985) 39 Cal.3d 311, 318.)  

REQUEST FOR JUDICIAL NOTICE 

 Defendant requests judicial notice of six court records.  The Court grants the request pursuant to Evid. Code § 452, subdivision (d).      

 

DISCUSSION 

Breach of Contract 

Plaintiff alleges a partly oral and partly written contract, which was allegedly breached in September 2018.  (SAC ¶¶ 3, 5; see also Opp. at 4 (“In September of 2018, Defendant Mack breached this agreement by stopping working on the website prior to its completion[.]”).)  If the terms of a contract are partly oral and partly written, the statute of limitations is the one applicable to oral contracts, which is two years.  (1-2 Corbin on Contracts § 2.10; McClain v. Rush (1989) 216 Cal.App.3d 18, 30-31; see also Civ. Proc. Code § 339.)  Plaintiff did not file its complaint until March 5, 2021.  Accordingly, Plaintiff’s breach of contract claim is time-barred, and the Court SUSTAINS the demurrer as to the first cause of action for breach of contract without leave to amend.   

Breach of Implied Covenant of Good Faith and Fair Dealing 

Plaintiff’s second cause of action alleges a breach of the covenant of good faith and fair dealing implied in the parties’ contract.  Because the implied covenant claim is based on a contractual theory, its statute of limitations is the same as that for breach of the underlying contract.  Krieger v. Nick Alexander Imports, Inc., 234 Cal.App.3d 205, 220-21, 285 Cal. Rptr. 717 (1991) (statute of limitations for breach of implied covenant of good faith and fair dealing, when it is based on a contractual theory, is the same as that for breach of the underlying contract).  Accordingly, as with its breach of contract claim, Plaintiff’s claim for breach of the implied covenant of good faith and fair dealing is also time-barred.  The Court, therefore, SUSTAINS the demurrer on Plaintiff’s second cause of action without leave to amend. 

Conversion   

Conversion is the wrongful exercise of dominion over the property of another.  The elements of a conversion claim are: (1) the plaintiff’s ownership or right to possession of the property, (2) the defendant’s conversion by a wrongful act or disposition of property rights, and (3) damages.  (Lee v. Hanley (2015) 61 Cal.4th 1225, 1240.)   

Plaintiff alleges Defendant has converted Plaintiff’s data and website by refusing to return them upon Plaintiff’s request in September 2018.  (SAC ¶¶ 44-45.)  The Court previously sustained a demurrer on this cause of action because it was unclear based on Plaintiff’s allegations regarding the terms of the contract whether Defendant could rightfully withhold the data and website under certain conditions, including failure to make payments.  (6/2/2022 Minute Order at 4.)  The Court concludes Plaintiff’s allegations regarding the contract have not materially changed.  The terms of the contract are still too uncertain for the Court to conclude whether Defendant’s possession was wrongful.  Accordingly, the Court SUSTAINS the demurrer without leave to amend.  Plaintiff has the burden to show these defects can be cured by amendment which Plaintiff has failed to do.  Indeed, Plaintiff was already given an opportunity to amend the claim to correct these same defects but it failed to do so. 

Intentional and Negligent Interference     

Plaintiff’s claims for intentional interference with contractual relations, intentional interference with prospective economic advantage and negligent interference with prospective economic advantage are all subject to the two-year limitations period set forth in Code Civ. Proc. § 339(1). (See, e.g., Knoell v. Petrovich (1999) 76 Cal.App.4th 164, 168; August v. United Service Automobile Assn. (1993) 13 Cal.App.4th 4, 10); 3 Witkin, Cal. Procedure (3d ed. 1985) Actions, § 439, pp. 469, 470).  Accordingly, they are all time barred, as Plaintiff should have discovered the interference when Defendant refused to return their data and website in September 2018.  The Court, therefore, SUSTAINS the demurrer as to Plaintiff’s fourth, fifth and sixth causes of action without leave to amend. 

Negligent Misrepresentation   

A cause of action for negligent misrepresentation typically is subject to a two-year limitations period. (See Code Civ. Proc., § 339; Ventura County Nat. Bank v. Macker (1996) 49 Cal.App.4th 1528, 1530–1531; see generally 1 Schwing, Cal. Affirmative Defenses, supra, § 25:21, pp. 1415–1416, fns. 8–9.)  Plaintiff should have discovered Defendant’s alleged misrepresentations at least by September 2018 when it obtained access to the unfinished website and discovered that Defendant’s work was shoddy and contrary to their representations that Defendant was a proficient website development company or had the right people and skillset.  (SAC ¶ 68.)  Also, in September 2018, Defendant demanded payment of $200,000 which Plaintiff alleges rendered false their earlier representation that they would accept $60,000.  (SAC ¶¶ 24, 68.)  Accordingly, even assuming Plaintiff had properly stated a claim for negligent misrepresentation, the claim is time-barred, and the Court SUSTAINS the demurrer as to Plaintiff’s negligent misrepresentation claim without leave to amend.  

Bus. & Prof. Code § 17200    

The limitations period for an unfair business claim is generally four years (Bus. & Prof. Code, § 17208), but “under California's ‘primary right’ theory of code pleading, we determine the causes of action alleged in the complaint ‘based on the injury to the plaintiff, not on the legal theory or theories advanced to characterize it.’ [Citations.] ‘Thus, if a plaintiff states several purported causes of action which allege an invasion of the same primary right he has actually stated only one cause of action …’”  (Moss v. Duncan (2019) 36 Cal.App.5th 569, 574; Choi v. Sagemark Consulting (2017) 18 Cal.App.5th 308, 335; see Curtis v. Kellogg & Andelson (1999) 73 Cal.App.4th 492, 503).  Here, Plaintiff’s claim for unfair business practices is based on the invasion of the same primary rights as Plaintiff’s other causes of action, and accordingly, the two year limitations period applies.  (Moss, 36 Cal.App.5th at 574.)  The two year period began to run when Defendant allegedly withheld Plaintiff’s data and website in September 2018 which purportedly constituted “unlawful and unfair acts.”  (SAC ¶¶ 24, 74.)  Plaintiff did not file its complaint until March 2021.  Therefore, the claim is time-barred, and the Court SUSTAINS the demurrer without leave to amend as to Plaintiff’s eighth cause of action.   

Injunctive Relief 

Plaintiff seeks injunctive relief in the form of enjoining Defendant from withholding Plaintiff’s data and website.  However, the SAC alleges that Defendant returned the data and website to Plaintiff on March 25, 2019.  (SAC ¶27.)  Therefore, there can be no order requiring Defendant to do something it is alleged to have already done.  Accordingly, the Court SUSTAINS the demurrer to Plaintiff’s ninth cause of action for injunctive relief without leave to amend.    

CONCLUSION 

Based on the foregoing, the Court SUSTAINS Defendants’ demurrer without leave to amend as to all causes of action.    

 

IT IS SO ORDERED. 

 

DATED: April 28, 2023 ___________________________ 

Edward B. Moreton, Jr. 

Judge of the Superior Court