Judge: Elaine Lu, Case: 22STCV14368, Date: 2023-04-06 Tentative Ruling

Case Number: 22STCV14368    Hearing Date: April 6, 2023    Dept: 26

Superior Court of California

County of Los Angeles

Department 26

Procedural Background

            On April 29, 2022, Plaintiff Paul Falzon (“Plaintiff”) filed the instant wrongful termination action.  On October 24, 2022, Plaintiff filed a First Amended Complaint against Defendants SMG Holdings, Inc. (“SMG Inc.”), SMG Holdings, LLC, (“SMG LLC”), ASM Global (“ASM”), and Steve Goodling (“Goodling”).  On November 29, 2022, Defendant Goodling filed a demurrer and motion to strike portions of the First Amended Complaint which on January 13, 2023, the Court sustained and granted, respectively, with leave to amend.  (Order 1/13/23.)

            On February 1, 2023, Plaintiff filed the operative Second Amended Complaint (“SAC”).  The SAC asserts four causes of action for (1) Retaliation (Labor Code § 1102.5), (2) Wrongful Termination in Violation of Public Policy, (3) Intentional Interference with Prospective Economic Advantage, and (4) Negligent Interference with Prospective Economic Advantage.

            On March 8, 2023, Defendant Goodling filed the instant demurrer and motion to strike portions of the SAC.  On March 24, 2023, Plaintiff filed oppositions to the demurrer and motion to strike.  On March 29, 2023, Defendant Goodling filed a reply to the motion to strike.  No reply for the demurrer has been filed.

Allegations of the Operative Complaint

            The SAC alleges that:

            ASM is a venue and event management company that manages “over 300 stadiums, arenas and convention centers around the world.”  (SAC ¶ 11.)  AMS’s subsidiary SMG, Inc. and its successor SMG LLC “manage[] and operate[] the venue known as the Long Beach Convention & Entertainment Center (LBCEC) pursuant to a contract between SMG and the City of Long Beach.”  (SAC ¶¶ 2-3, 11.)  Defendant Goodling is the President and Chief Executive Officer of the Long Beach Convention & Visitors Bureau.  (SAC ¶ 12.)

            ASM, SMG, Inc., and SMG, LLC hired Plaintiff to serve as the Director of Finance, and Senior Accounting and Finance Executive at LBCEC, and Plaintiff reported to the LBCEC’s General Manager Charlie Beirne.  (SAC ¶ 13.)  Plaintiff had no performance issues and in fact received a substantial salary increase in August 2021.  (SAC ¶ 15.)

            While serving as Director of Finance, and Senior Accounting and Finance Executive, Plaintiff uncovered that “Goodling was spending public money to buy furniture that he converted to his personal use. Ultimately, Plaintiff calculated that Goodling spent over $1.3 million in public funds on furniture and unapproved purchases.”  (SAC ¶ 17.)  “Plaintiff determined that there were no purchase orders, no competitive bidding, no vendor selection process, and the City of Long Beach, which owns the LBCEC, was unaware of the full extent of Goodling’s unapproved furniture shopping activities.”  (SAC ¶ 18.)  “Plaintiff reasonably believed that Goodling, in his role as President and CEO of the LBCVB was a public officer. As a certified public accountant charged with accounting for Goodling' s purchases, Plaintiff believed that he and Goodling shared duties and responsibilities for the proper handling and disposition of the monies in the Parking Fund and Facility Fund described above.”  (SAC ¶ 19.)

            “Goodling committed financial waste in other areas. For example, at one event, the client wanted music played off an iPhone music playlist. Goodling felt this was below standard so he ordered a DJ with a light package that was paid for by the City of Long Beach.”  (SAC ¶ 22.)  “Goodling spent City of Long Beach money on extravagant holiday lighting displays and expensive landscaping projects. Goodling spent approximately $102,345 for flowers on a rainbow bridge.”  (SAC ¶ 23.)  “Goodling’s fraudulent purchases, [] were extravagant and wasteful and violated state and local laws and regulations because they had not been preapproved as per the SMG/LBCEC purchasing guidelines.”  (SAC ¶ 25.) 

            “Plaintiff complained internally to Beirne about Goodling operating outside company and city policy. Beirne threatened Plaintiff, saying that if SMG lost the contract to manage the LBCEC a new management company would take over and Beirne and Plaintiff would be terminated. Beirne explained that Goodling’s political influence, i.e., ‘clout,’ with the Mayor and City Council would help ASM / SMG renew the contract without going to a request for proposal (RFP). Beirne made clear that SMG/ASM Management would not care about Goodling’s financial abuse because Steve Goodling was wasting City of Long Beach funds and not SMG/ASM funds. Plaintiff was essentially told to shut up and remain silent about Goodling’s fraud, or else lose his job.”  (SAC ¶ 26.)

            “In July 2021, after Plaintiff complained again, Beirne said that Plaintiff’s complaints of inappropriate spending and misuse of city funds would be investigated. The City of Long Beach sent a warning letter to ASM about abiding by the City’s purchasing requirements. However, there was no investigation by SMG or ASM at that time. Instead, Goodling and Beirne cornered Plaintiff and threatened him.”  (SAC ¶ 27.)

            “On August 9, 2021, Plaintiff attended a work-related event in Bogarts Café. After the event, Beirne asked Plaintiff to meet with him and Goodling. In this impromptu meeting, Goodling wanted Plaintiff to apologize for complaining. Goodling said he did not think Plaintiff was ‘on board’ with Goodling’s vision for the LBCEC. Goodling pressured and bullied Plaintiff, saying to Plaintiff, in an aggressive tone, that if Plaintiff was unwilling to get on board with his vision, then ‘this was not the right job’ for him. Goodling stated, in essence, that Plaintiff needed to get on board with Goodling's vision or else he needed ‘to go.’ Thus, Goodling had the power, authority, and influence to determine whether Plaintiffs job was ‘right’ for Plaintiff.”  (SAC ¶ 28.)  “Goodling exerted his ‘clout’ with the City and the corporate defendants, SMG and ASM by telling Plaintiff that SMG (and its affiliate/parent, ASM) were making a lot of money on the City contract (as if the profit on the management contract should justify or excuse his shopping sprees). Goodling informed Plaintiff that the contract was up for renewal in an effort to pressure Plaintiff into remaining silent. Goodling further pressured Plaintiff by telling Plaintiff that Plaintiff’s complaints were making ‘things difficult’ for Goodling.”  (SAC ¶ 29.)

            “There was a power imbalance in the special relationship between Goodling, as the Chief Executive Officer of the facility where Plaintiff worked and officed, and Plaintiff, the Finance Director responsible for accounting for Goodling's financial transactions. Goodling expressed his displeasure with Plaintiff because of Plaintiffs complaints. Goodling acted as a manager and supervisor of LBCEC staff by making it clear to Plaintiff and SMG/ASM, through his actions and conduct, that Goodling had the power and authority to silence Plaintiff, by retaliating and having Plaintiff terminated from his job. Plaintiffs direct supervisor, Beirne did nothing while Goodling attacked, intimidated and threatened Plaintiff for making complaints about Goodling's expenditures. Beirne did not defend Plaintiff at all during or after the meeting. It appeared to Plaintiff that Beirne sided with Goodling during Goodling's unlawful, verbal assault and vicious attacks on Plaintiff.”  (SAC ¶ 32.) 

            On “August 17, 2021, Plaintiff met with an auditor and supervisor with the firm of Lance, Soll & Lunghard, the LBCEC External Auditors.”  (SAC ¶ 34.)  During this audit meeting, “Plaintiff disclosed Goodling’s inappropriate and unlawful purchasing activities.”  (SAC ¶ 34.) 

            “On September 28, 2021, Beirne called Plaintiff into a termination meeting. Beirne, and McClintock informed Plaintiff that Plaintiff was being terminated due to ‘position elimination.’”  (SAC ¶ 36.)  “SMG purported to offer Plaintiff a corporate job at SMG’s corporate office in Los Angeles.”  (SAC ¶ 38.)  However, this was not a legitimate job offer as “[t]he offer was vague[,] [t]he position was temporary[,] [and] [t]he Defendant’s Human Resources Manager has confirmed in a sworn statement that the corporate job offer was pretextual and the termination was retaliatory.”  (SAC ¶ 38.)  “Plaintiff immediately complained to McClintock that his termination was based on Goodling retaliating against Plaintiff.”  (SAC ¶ 39.)  Immediately after, on October 22, 2021, Plaintiff was placed on administrative leave.  (SAC ¶¶ 39-40.)  On October 25, 2021, ASM’s Executive Vice-President, Bob McClintock sent an email announcing to SMG Inc. and SMG LLC employees that Plaintiff had resigned.  (SAC ¶ 41.)  This was untrue as Plaintiff did not resign.  (SAC ¶ 41.)  “On October 28, 2021, SMG’s investigator, Ms. Gilkin, finally interviewed Plaintiff in response to Plaintiff’s complaints.”  (SAC ¶ 42.)

            “Plaintiff was told that he would be terminated, effective November 12, 2021 or the following Monday, November 15, 2021.  The termination was finalized, effective November 12, 2021.”  (SAC ¶ 43.)

Untimely Opposition Papers

            “All papers opposing a motion so noticed shall be filed with the court and a copy served on each party at least nine court days, and all reply papers at least five court days before the hearing.”  (Code Civ. Proc., § 1005(b).)  This is calculated by counting backwards from the hearing date and excluding holidays and weekends.  (Code Civ. Proc. §§ 12-12(c).)  The court may refuse to consider a late-filed paper.  (Cal. Rules of Court, Rule 3.1300(d).) 

            Here, the opposition was filed on March 24, 2023 – eight court days before the instant hearing.  Accordingly, the opposition is untimely.  However, as Defendant Goodling was able to timely file a reply, the Court will consider the untimely opposition.

Legal Standard

Demurrer Standard 

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. (Blank v. Kirwan (1985) 39 Cal 3d 311, 318.) No other extrinsic evidence can be considered (i.e., no “speaking demurrers”). (Ion Equipment Corp. v. Nelson (1980) 110 Cal.App.3d 868, 881.)

A demurrer for sufficiency tests whether the complaint states a cause of action. (Hahn v. Mirda (2007) 147 Cal. App. 4th 740, 747.)  When considering demurrers, courts “give the complaint a reasonable interpretation, and read it in context.”  (Schifando v. City of Los Angeles (2003) 31 Cal.4th 1074, 1081.)  In a demurrer proceeding, the defects must be apparent on the face of the pleading or via proper judicial notice.  (Donabedian v. Mercury Ins. Co. (2004) 116 Cal. App. 4th 968, 994.)  “A demurrer tests the pleadings alone and not the evidence or other extrinsic matters.  Therefore, it lies only where the defects appear on the face of the pleading or are judicially noticed.”  (SKF Farms v. Superior Ct. (1984) 153 Cal. App. 3d 902, 905.)  “The only issue involved in a demurrer hearing is whether the complaint, as it stands, unconnected with extraneous matters, states a cause of action.”  (Hahn, supra, 147 Cal.App.4th at 747.) 

Motion to Strike Standard

Motions to strike are used to reach defects or objections to pleadings that are not challengeable by demurrer (i.e., words, phrases, prayer for damages, etc.).  (See CCP §§ 435-437.)  A party may file a motion to strike in whole or in part within the time allowed to respond to a pleading.  However, if a party serves and files a motion to strike without demurring to the complaint, the time to answer is extended.  (CCP §§ 435(b)(1), 435(c).)

A motion to strike lies only where the pleading has irrelevant, false, or improper matter, or has not been drawn or filed in conformity with laws.  (CCP § 436.)  The grounds for moving to strike must appear on the face of the pleadings or by way of judicial notice.  (CCP § 437.)

Meet and Confer Requirement

Code of Civil Procedure § 430.41, subdivision (a) requires that “[b]efore filing a demurrer pursuant to this chapter, the demurring party shall meet and confer¿in person or by telephone¿with the party who filed the pleading that is subject to demurrer for the purpose of determining whether an agreement can be reached that would resolve the objections to be raised in the demurrer.” The parties are to meet and confer at least five days before the date the responsive pleading is due and if they are unable to meet the demurring party shall be granted an automatic 30-day extension.  (CCP § 430.41(a)(2).)  The demurring party must also file and serve a declaration detailing the meet and confer efforts.  (Id.¿at (a)(3).)¿ If an amended pleading is filed, the parties must meet and confer again before a demurrer may be filed to the amended pleading.  (Id.¿at (a).)  There is a similar meet and confer requirement for motions to strike.  (CCP § 435.5.)

Here, Defendant Goodling has fulfilled the meet and confer requirements.  (Peterson Decl. ¶¶ 2-4, Exh. A.)[1]

Discussion – Demurrer

            Defendant Goodling demurrers to the causes of action raised against him – i.e., the third and fourth causes of action for intentional interference of prospective economic advantage and negligent interference of prospective economic advantage.

Third and Fourth Causes of Action: Lack of Independently Wrongful Conduct

            Defendant Goodling asserts that the third and fourth causes of action fail because there is no allegation of independently wrongful conduct committed by Goodling.

            “To establish a prima facie case of intentional interference with prospective economic advantage, a plaintiff must demonstrate (1) an economic relationship between the plaintiff and a third party, with a probability of future economic benefit to the plaintiff; (2) the defendant's knowledge of this relationship; (3) intentional and wrongful conduct on the part of the defendant, designed to interfere with or disrupt the relationship; (4) actual disruption or interference; and (5) economic harm to the plaintiff as a proximate result of the defendant's wrongful conduct.”  (Overstock.com, Inc. v. Gradient Analytics, Inc. (2007) 151 Cal.App.4th 688, 713.)  “With respect to the third element, a plaintiff must show that the defendant engaged in an independently wrongful act.” (San Jose Construction, Inc. v. S.B.C.C., Inc. (2007) 155 Cal.App.4th 1528, 1544.) 

            “The elements of negligent interference with contract or prospective economic advantage are (1) the existence of a valid contractual relationship or other economic relationship between the plaintiff and a third party containing the probability of future economic benefit to the plaintiff; (2) the defendant’s knowledge (actual or construed) of the relationship; (3) the defendant’s knowledge (actual or construed) that the relationship would be disrupted if the defendant failed to act with reasonable care; (4) the defendant’s failure to act with reasonable care; (5) actual disruption of the relationship; and (6) resulting economic harm.”  (Nelson v. Tucker Ellis, LLP (2020) 48 Cal.App.5th 827, 844, Fn. 5.)  Similar to a claim for intentional interference with prospective economic advantage, “[f]or negligent interference, a defendant's conduct is blameworthy only if it was independently wrongful apart from the interference itself.”  (Lange v. TIG Ins. Co. (1998) 68 Cal.App.4th 1179, 1187.)

            “ ‘[A]n act is independently wrongful if it is unlawful, that is, if it is proscribed by some constitutional, statutory, regulatory, common law, or other determinable legal standard .... an act must be wrongful by some legal measure, rather than merely a product of an improper, but lawful, purpose or motive.’ [Citation.]”  (San Jose Construction, Inc., supra, 155 Cal.App.4th at p.1545.)  As the Supreme Court has noted, “[t]he tort of intentional interference with prospective economic advantage is not intended to punish individuals or commercial entities for their choice of commercial relationships or their pursuit of commercial objectives, unless their interference amounts to independently actionable conduct. [Citation.] We conclude, therefore, that an act is independently wrongful if it is unlawful, that is, if it is proscribed by some constitutional, statutory, regulatory, common law, or other determinable legal standard.”  (Korea Supply Co. v. Lockheed Martin Corp. (2003) 29 Cal.4th 1134, 1158–1159.)  “The plaintiff must also prove that the interference was wrongful, independent of its interfering character.”  (Edwards v. Arthur Andersen LLP (2008) 44 Cal.4th 937, 944.)

            Here, the SAC alleges that Goodling misappropriated $1.3 million in funds from the City of Long Beach on furniture and unapproved purchases and committed financial waste by spending the City of Long Beach’s money on extravagant holiday lighting displays and expensive landscaping projects.  (SAC ¶¶ 16-24.)  While misappropriating funds is an independently wrongful act, this conduct is unrelated to Plaintiff’s alleged harm of being terminated.  Rather, the SAC contends that “Defendant Goodling sought to and did influence SMG/ASM to terminate Plaintiff’s employment for retaliatory reasons based on Plaintiff’s complaints.”  (SAC ¶ 69; see also SAC ¶ 82, [“Defendant Goodling negligently engaged in threats and meddling and influenced SMG/ASM to terminate Plaintiff’s employment for retaliatory reasons based on Plaintiff’s complaints.”].) 

            While Goodling was not Plaintiff’s supervisor, Plaintiff alleges that Plaintiff had an indirect reporting relationship with Goodling.  (SAC ¶ 14.)  “Goodling acted as a manager and supervisor of LBCEC staff by making it clear to Plaintiff and SMG/ASM, through his actions and conduct, that Goodling had the power and authority to silence Plaintiff, by retaliating and having Plaintiff terminated from his job. Plaintiffs direct supervisor, Beirne did nothing while Goodling attacked, intimidated and threatened Plaintiff for making complaints about Goodling's expenditures. Beirne did not defend Plaintiff at all during or after the meeting. It appeared to Plaintiff that Beirne sided with Goodling during Goodling's unlawful, verbal assault and vicious attacks on Plaintiff.”  (SAC ¶ 32.)  On August 9, 2021, at an impromptu meeting during a work event in Bogarts Café, Goodling pressured Plaintiff into remaining silent by implying that Plaintiff’s employers’ contract was up for renewal.  (SAC ¶ 29.)  After, Plaintiff net with an auditor and reported Goodling’s conduct “Beirne met with Goodling, ASM's Executive Vice-President, Bob McClintock (McClintock), and the Long Beach City Manager. Goodling conspired with ASM/SMG's executives to have Plaintiff terminated from his job. Defendants, including Goodling acted unlawfully during this meeting by discussing Plaintiffs employment status, because the employment relationship between Plaintiff and ASM/SMG was confidential. Goodling unlawfully interfered with a confidential personnel matter to harm Plaintiff. Shortly after that meeting, Beirne informed SMG's Human Resources Manager that Plaintiffs position was going to be eliminated.”  (SAC ¶ 35.)

            This conduct is sufficient to state an independently wrongful act for violation of the whistleblower protection act through a civil conspiracy.

            “Civil conspiracy is not an independent tort.”  (City of Industry v. City of Fillmore (2011) 198 Cal.App.4th 191, 211.)  Rather, it is “a legal doctrine that imposes liability on persons who, although not actually committing a tort themselves, share with the immediate tortfeasors a common plan or design in its perpetration.”  (Applied Equipment Corp. v. Litton Saudi Arabia Ltd. (1994) 7 Cal.4th 503, 510–511.)  “The elements of liability under conspiracy are: (1) formation and operation of the conspiracy; (2) wrongful conduct in furtherance of the conspiracy; and (3) damages arising from the wrongful conduct.”  (Spencer v. Mowat (2020) 46 Cal.App.5th 1024, 1037.)  “By its nature, tort liability arising from conspiracy presupposes that the coconspirator is legally capable of committing the tort, i.e., that he or she owes a duty to plaintiff recognized by law and is potentially subject to liability for breach of that duty.”  (Applied Equipment Corp., supra, 7 Cal.4th at p.511.) 

            Here, unlike the prior pleadings, the SAC alleges that Defendant Goodling is capable of committing whistleblower retaliation.  Under Labor Code section 1102.5(b), “[a]n employer, or any person acting on behalf of the employer, shall not retaliate against an employee for disclosing information, … if the employee has reasonable cause to believe that the information discloses a violation of state or federal statute, or a violation of or noncompliance with a local, state, or federal rule or regulation, regardless of whether disclosing the information is part of the employee's job duties.”  (Ibid., [italics added].)  The SAC sufficiently alleges that Goodling was acting on behalf of Plaintiff’s employer as Plaintiff’s supervisor.  (SAC ¶ 32.)  Thus, Goodling could potentially commit a violation of Labor Code section 1102.5(b) by retaliating against Plaintiff for reporting illegal conduct.  The SAC alleges Goodling did this by conspiring with the other Defendants.  (SAC ¶ 35.)

            Accordingly, as the SAC alleges independently wrongful conduct by Defendant Goodling, Defendant Goodling’s demurrer to the third and fourth cause of action is overruled on this ground.

Fourth Cause of Action: Negligent Interference with Prospective Economic Advantage

            Defendant Goodling also asserts that the fourth cause of action also fails because Plaintiff cannot establish a duty of care.

            As noted above, “[t]he elements of negligent interference with contract or prospective economic advantage are (1) the existence of a valid contractual relationship or other economic relationship between the plaintiff and a third party containing the probability of future economic benefit to the plaintiff; (2) the defendant’s knowledge (actual or construed) of the relationship; (3) the defendant’s knowledge (actual or construed) that the relationship would be disrupted if the defendant failed to act with reasonable care; (4) the defendant’s failure to act with reasonable care; (5) actual disruption of the relationship; and (6) resulting economic harm.”  (Nelson, supra, 48 Cal.App.5th at p.844, Fn. 5.)  “‘The tort of negligent interference with economic relationship arises only when the defendant owes the plaintiff a duty of care.’ [Citation.]”    (LiMandri v. Judkins (1997) 52 Cal.App.4th 326, 348.)

            “Duty is not universal; not every defendant owes every plaintiff a duty of care. A duty exists only if ‘ “the plaintiff's interests are entitled to legal protection against the defendant's conduct.” ’ [Citations.]”  (Brown v. USA Taekwondo (2021) 11 Cal.5th 204, 213.)  “Whether a duty exists is a question of law to be resolved by the court.”  (Ibid.)

“The determination whether in a specific case the defendant will be held liable to a third person not in privity is a matter of policy and involves the balancing of various factors, among which are the extent to which the transaction was intended to affect the plaintiff, the foreseeability of harm to him, the degree of certainty that the plaintiff suffered injury, the closeness of the connection between the defendant's conduct and the injury suffered, the moral blame attached to the defendant’s conduct, and the policy of preventing future harm.”  (Biakanja v. Irving (1958) 49 Cal.2d 647, 650.) 

In Biakanja v. Irving, the Court found that the plaintiff could recover despite a lack of privity where the defendant, a notary public, prepared an improperly attested will, wherein the plaintiff's brother attempted to give his entire estate to the plaintiff. The will was denied probate, and the plaintiff received only his intestate share.  (Id. at pp.648-651.)  The Supreme Court noted that “the ‘end and aim’ of the transaction was to provide for the passing of [plaintiff’s brother]'s estate to plaintiff.  (Id. at p.650.)

            Here, Goodling is the President and Chief Executive Officer of the Long Beach Convention & Visitors Bureau.  (SAC ¶ 12.)  Though Goodling was not Plaintiff’s supervisor, Plaintiff alleges that Plaintiff had an indirect reporting relationship with Goodling.  (SAC ¶ 14.)  “Goodling acted as a manager and supervisor of LBCEC staff by making it clear to Plaintiff and SMG/ASM, through his actions and conduct, that Goodling had the power and authority to silence Plaintiff, by retaliating and having Plaintiff terminated from his job. Plaintiff’s direct supervisor, Beirne did nothing while Goodling attacked, intimidated and threatened Plaintiff for making complaints about Goodling's expenditures. Beirne did not defend Plaintiff at all during or after the meeting. It appeared to Plaintiff that Beirne sided with Goodling during Goodling's unlawful, verbal assault and vicious attacks on Plaintiff.”  (SAC ¶ 32.)  Moreover, the SAC alleges that Goodling directly participated in Plaintiff’s termination.  (SAC ¶ 35.) 

            Applying the Biakanja factors, the Court finds that there is a basis to impose a duty on Goodling. Goodling’s meeting and working with the other defendants to terminate Plaintiff is clearly intended to affect Plaintiff and did result in harm to Plaintiff due to the authority that Goodling had and exercised with respect to the renewal of Plaintiff’s employers’ contract.

            Therefore, Defendant Goodling’s demurrer to the fourth cause of action is also overruled on this additional ground.

Discussion – Motion to Strike

            Defendant Goodling moves to strike the prayer for punitive damages from the FAC. 

California Civil Code section 3294 authorizes the recovery of punitive damages in non-contract cases where “the defendant has been guilty of oppression, fraud, or malice . . . .” (Civ. Code, § 3294(a).) “‘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.” (Id. at (c)(1).) “‘Oppression’ means despicable conduct that subjects a person to cruel and unjust hardship in conscious disregard of that person’s rights.” (Id. at (c)(2).) “‘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.” (Id. at (c)(3).) Punitive damages thus require more than the mere commission of a tort. (See Taylor v. Superior Court (1979) 24 Cal.3d 890, 894-895.)

Moreover, a demand for punitive damages for the commission of any tort requires more than the mere conclusory allegations of “oppression, fraud, and malice.”  (Civ. Code § 3294; see Perkins v. Superior Court (1981) 117 Cal. App.3d 1, 6-7.)  Rather, “[t]here must be circumstances of aggravation or outrage, such as spite or malice, or a fraudulent or evil motive on the part of Defendant, or such a conscious and deliberate disregard of the interest of others that its conduct may be called willful or wanton.” (Taylor, supra, 24 Cal.3d at pp.894-895, [italics added].)

Here, as alleged, Defendant Goodling was misappropriating public funds and when Plaintiff reported such conduct, Goodling utilized his connections and sway over Plaintiff’s employers and directly participated in terminating Plaintiff in retaliation.  (SAC ¶¶ 30-35.)  This is sufficient to show willful or wanton conduct against Plaintiff such as to warrant punitive damages.

Accordingly, Plaintiff’s motion to strike the prayer for punitive damages is DENIED.

Conclusion and ORDER

            Based on the foregoing, Defendant Steve Goodling’s demurrer to the second amended complaint is OVERRULED.

            Defendant Steve Goodling’s motion to strike is DENIED.

            Defendant Goodling is to file an answer within thirty (30) days of notice of this order – no later than May 8, 2023.

            The case management conference is continued to May 10, 2023 at 8:30 am.

            Moving Party is to provide notice of this order and file proof of service of such.

DATED: April 6, 2023                                                           ___________________________

                                                                                          Elaine Lu

                                                                                          Judge of the Superior Court