Judge: Elaine Lu, Case: 22STCV28564, Date: 2023-08-08 Tentative Ruling

Case Number: 22STCV28564    Hearing Date: December 14, 2023    Dept: 26

Superior Court of California

County of Los Angeles

Department 26

Procedural Background

            On September 1, 2022, Plaintiff Christina Development Corporation (“CDC”) filed the instant tortious interference action against Defendant Steven Raymond Short (“Short”).  CDC’s complaint asserts five causes of action for (1) Tortious Interference with Contractual Relations, (2) Defamation, (3) Civil Harassment, (4) Conversion, and (5) Breach of Contract.

            On January 18, 2023, Short filed the case entitled Steve Short v. Christina Development Corporation; Christina Properties Limited, et al. Los Angeles Superior Court, Case No. 23VECV00203 for Labor Code violations against CDC, Christina Properties Limited, G&A Partners, LTD, David Allen Whitehead, Lawrence Norman Taylor, Adam Jacob Rosenkranz, Vincent Chan, Connor Stephen Wilks, JW Associates, LLC, Empire View Homes, LLC, and Crescent Hill Lofts, LLC. 

            On March 10, 2023, CDC filed a notice of related cases with the case entitled Steve Short v. Christina Development Corporation; Christina Properties Limited, et al. Los Angeles Superior Court, Case No. 23VECV00203.  On March 29, 2023, the Court found the two cases related and set an Order to Show Cause as to why the cases should not be consolidated.  (Minute Order 3/29/23.)  On April 20, 2023, the Court consolidated the two actions for all purposes.  (Minute Order 4/20/23.) 

            On June 13, 2023, Plaintiff Short filed the operative second amended complaint (“SAC”) against Defendants CDC, Christina Properties Limited, G&A Partners, LTD, David Allen Whitehead, Lawrence Norman Taylor, Adam Jacob Rosenkranz, Vincent Chan, Connor Stephen Wilks, JW Associates, LLC, Empire View Homes, LLC, Crescent Hill Lofts, LLC, and Chateau Park Homes, LLC.  The SAC asserts nineteen causes of action for (1) Failure to Pay Sick Time Per LAMC §§ 187, 188 and Labor Code § 558.1, (2) Breach of Contract, (3) Civil Harassment – Civil Code § 527.6 and Labor Code § 1290(j)(1), (4) Not Paying Expenses – Labor Cde § 2802 and Labor Code § 558.1, (5) Retaliation, (6) Hostile Work Environment, (7) Using Megan’s Law Website to Terminate in Violation of Penal Code § 290.4(d)(1)(E), (8) Not Paying Overtime in Violation of Labor Code §§ 510, 558.1, (9) Forcing Plaintiff to be a Part of its Loan Fraud in Violation of Civil Code § 1710, (10) Conversion, (11) Disclosing that Plaintiff is Listed on Megan’s Law Website in Violation of Violation of Penal Code § 290.4(d)(1), (12) Unfair Competition Law – Business and Professions Code § 17200, et seq., (13) Not Paying Minimum Wage in Violation of Labor Code §§ 1197, 558.1, (14) Failure to Pay Sick Time under the WHMC § 5.130.030 and Labor Code § 558.1, (15) False Promise to Induce Plaintiff into Employment per Labor Code §§ 970, 558.1, (16) Wrongful Termination, (17) OSHA Safety Violations, (18) Whistleblower Retaliation in Violation of Labor Code § 1102.5, and (19) Invasion of Privacy.

            On June 26, 2023, Defendants CDC, Christina Properties Limited, David Allen Whitehead, Lawrence Norman Taylor, Adam Jacob Rosenkranz, Vincent Chan, Connor Stephen Wilks, JW Associates, LLC, Empire View Homes, LLC, and Crescent Hill Lofts, LLC (collectively “Moving Defendants”) filed the instant demurrer to Short’s SAC. 

            On September 11, 2023, the instant consolidated action was deemed related to the case entitled Christina Development Corporation v. Creditlink Corporation, et al., Los Angeles Superior Court, Case No. 23STCV18491.  (Minute Order 9/11/23.)

            Due to service defects, the Court continued the instant demurrer to December 14, 2023.

            On December 4, 2023, Short filed an opposition.  No reply has been filed.

Legal 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 read the allegations liberally and in context.  (Taylor v. City of Los Angeles Dep’t of Water & Power (2006) 144 Cal. App. 4th 1216, 1228.)  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.) 

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).)

Moving Defendants have satisfied the meet and confer requirement.  (Williams Decl. ¶¶ 6-14, Exhs. C-E.)

Discussion

            Moving Defendants demurrer to the first, second, third, fourth, fifth, sixth, eighth, ninth, twelfth, thirteenth, fourteenth, fifteenth, sixteenth, seventeenth, and eighteenth causes of action.

First and Fourteenth Causes of Action: Sick Pay Leave

            Moving Defendants contend that the claims for sick pay leave under the West Hollywood Municipal Code and the Los Angeles Municipal Code fail because Plaintiff Short concedes he was provided paid time off.

            Under the LAMC, employers are required to provide full-time employees a minimum of 48 hours paid sick leave per year.  (LAMC § 187.04.)  However, “[i]f an Employer has a paid leave or paid time off policy or provides payment for compensated time off, that is equal to or no less than 48 hours, no additional time is required.”  (LAMC § 187.04(F).)  Under the WHMC, “[e]mployers shall provide at least ninety-six compensated hours off per year for sick leave, vacation, or personal necessity to full time employees to be made available at the employee’s request.”  (WHMC § 5.130.030(a).) 

            As the SAC concedes, Plaintiff Short has paid time off, as “Plaintiff had to use PTO whenever Plaintiff had a sick day or doctor’s appointment.”  (SAC at p.4:25-26.)  Paid time off is permitted in lieu of sick leave as long as it provides at least the minimum of 48 hours and 96 hours for the LAMC and WHMC respectively.  The SAC does not allege that Plaintiff Short was provided less than the minimum of 48 hours and 96 hours for the LAMC and WHMC respectively.  Accordingly, Moving Defendants’ demurrer to the first and fourteenth causes of action is SUSTAINED.

Second Cause of Action: Breach of Contract

            Moving Defendants assert that Plaintiff Short fails to sufficiently allege a contract between the parties.

            “The elements of a cause of action for breach of contract are: ‘(1) the contract, (2) plaintiff's performance or excuse for nonperformance, (3) defendant's breach, and (4) the resulting damages to plaintiff.’”  (Coles v. Glaser (2016) 2 Cal.App.5th 384, 391 [internal citations omitted].)  “A contract is an agreement to do or not to do a certain thing.”  (Civ. Code, § 1549.)  The essential elements of a contract are parties capable of contracting; their consent; a lawful object; and a sufficient cause or consideration.  (Civ. Code, § 1550.) “To state a cause of action for breach of contract, it is absolutely essential to plead the terms of the contract either in haec verba or according to legal effect.” (Progressive West Ins. Co. v. Yolo County Superior Court (2005) 135 Cal.App.4th 263, 270, Fn. 1.)

            Here, the SAC alleges that “[a]s an inducement for Plaintiff join Defendant CDC as an employee, Plaintiff negotiated and Defendant subsequently offered a quarterly bonus incentive plan (the contract) since Defendant could not afford to pay the salary Plaintiff could command elsewhere. Plaintiff earned quarterly bonuses the first few quarters of Plaintiff’s employment but was not given the opportunity to earn bonuses from 2018/2019 to 2022 save for one random bonus of $2,500.00 or so in 2020 or 2021. [¶] Plaintiff by any measure – and by CDC’s reviews of Plaintiff’s reviews – performed under the terms of the agreement with CDC.”  (SAC at p.5:8-16.)  This alleged contract with CDC is not attached to the SAC.  Nor has Plaintiff Short alleged the terms verbatim or according to legal effect.  Though the SAC alleges that a quarterly bonus incentive plan exists pursuant to the parties’ agreement, Short fails to specify the terms of this plan, including what Short had to do to earn the respective bonus and what the specific bonus amounts would be.

            Accordingly, Moving Defendants’ demurrer to the second cause of action is SUSTAINED.

Moreover, the second cause of action is asserted against Defendants CDC, Vincent Chan, and Lawrence Norman Taylor.  However, there is no allegation that Defendants Vincent Chan and Lawrence Norman Taylor are parties to the contract.  Accordingly, the demurrer is sustained on this additional basis as to Defendants Vincent Chan and Lawrence Norman Taylor.

Third and Sixth Cause of Action: Civil Harassment and Hostile Work Environment

            Moving Defendants assert that the claims for civil harassment and hostile work environment fail because Plaintiff Short fails to allege that he is part of a protected class.

            The Fair Employment and Housing Act (“FEHA”) prohibits harassment of an employee. (Gov. Code § 12940(j).) “[H]arassment focuses on situations in which the social environment of the workplace becomes intolerable because the harassment (whether verbal, physical, or visual) communicates an offensive message to the harassed employee.”  (Roby v. McKesson Corp. (2009) 47 Cal.4th 686, 706.)  Thus, “‘the exercise of personnel management authority properly delegated by an employer to a supervisory employee might result in discrimination, but not in harassment.’”  (Ibid.)  Harassing acts “consists of conduct outside the scope of necessary job performance, conduct presumably engaged in for personal gratification, because of meanness or bigotry, or for other personal motives.”  (Reno v. Baird (1998) 18 Cal.4th 640, 646.)  “To prevail on a hostile work environment claim under California's FEHA, an employee must show that the harassing conduct was ‘severe enough or sufficiently pervasive to alter the conditions of employment and create a work environment that qualifies as hostile or abusive to employees because of their [disability].’”  (Hughes v. Pair (2009) 46 Cal.4th 1035, 1043 [internal citations omitted].)

            “The elements of such a cause of action are: ‘(1) plaintiff belongs to a protected group; (2) plaintiff was subject to unwelcome [] harassment; (3) the harassment complained of was based on [the protected characteristic]; (4) the harassment complained of was sufficiently pervasive so as to alter the conditions of employment and create an abusive working environment; and (5) respondeat superior.’ [Citation.]”  (Kelley v. The Conco Companies (2011) 196 Cal.App.4th 191, 202–203.) 

            Here, the third cause of action is purportedly based on a non-existent Civil Code section 527.6 and non- existent Labor Code section 12940(j)(1) while the sixth cause of action for hostile work environment fails to state any statutory basis whatsoever.  Regardless, the only statutory basis for such causes is for harassment under FEHA – i.e., Government Code § 12940(j).  To state a claim for harassment or hostile work environment, Plaintiff Short is required to identify a protected group under FEHA of which Short is a member, and Plaintiff must allege that the harassment is based on this protected characteristic.  Plaintiff Short fails to do so and does not identify a protected class of which he is a part.  Nor does Plaintiff Short allege that any harassment was based on this protected class as required.

            Accordingly, Moving Defendants’ demurrer to the third and sixth causes of action is SUSTAINED.

Fourth Cause of Action: Unreimbursed Business Expenses

            Moving Defendants contends that the claim for unreimbursed business expenses is deficient and that the claim cannot be made against individual defendants.

            Pursuant to Labor Code section 2802, “[a]n employer shall indemnify his or her employee for all necessary expenditures or losses incurred by the employee in direct consequence of the discharge of his or her duties[.]”  (Lab. Code, § 2802(a).)  “‘The elements of a claim under Section 2802 are: (1) the employee made expenditures or incurred losses; (2) the expenditures or losses were incurred in direct consequence of the employee's discharge of his or her duties, or obedience to the directions of the employer; and (3) the expenditures or losses were reasonable and necessary.’”  (Arroyo v. International Paper Company (N.D. Cal. 2020) 611 F.Supp.3d 824, 844–845.)

            Here, the claim is asserted against defendants CDC and Vincent Chan.  The SAC states that “Defendant CDC failed to pay Plaintiff’s full mileage reimbursement from 8/1/17 to 2/15/22. Even though Defendant CDC paid Plaintiff approximately $500.00 per month, Defendant surreptitiously taxed each and every one of these reimbursements even though Defendant knows that expense reimbursements are not to be taxed. CDC ultimately paid Plaintiff amounts less than the IRS-mandated and State-mandated amounts Plaintiff was due.”  (SAC at p.8:5-10.)  “CHAN ordered that Short not be fully paid for his mileage.”  (SAC at p.8:16.)  While somewhat unclear, the SAC does assert that Short was paid in an amount less than required by law – i.e., in this case not for the full mileage reimbursement as required.  Thus, the SAC sufficiently states a claim under Labor Code section 2802.  Moreover, contrary to Moving Defendants’ contention, individuals and agents of an employer are both liable for specific Labor Code violations including this specific section.  “Any employer or other person acting on behalf of an employer, who violates, or causes to be violated, any provision regulating minimum wages or hours and days of work in any order of the Industrial Welfare Commission, or violates, or causes to be violated, Sections 203, 226, 226.7, 1193.6, 1194, or 2802, may be held liable as the employer for such violation.”  (Lab. Code, § 558.1(a), [bold and italics added].)

            Accordingly, Moving Defendants’ demurrer to the fourth cause of action is OVERRULED.

Fifth Cause of Action: Retaliation

            Moving Defendants assert that the claim for retaliation is insufficiently alleged.  The Court agrees.

            A claim for retaliation is a statutory claim.  Thus, “the general rule that statutory causes of action must be pleaded with particularity is applicable.”  (Lopez v. Southern Cal. Rapid Transit Dist. (1985) 40 Cal.3d 780, 795.)  Here, the SAC fails to allege the fifth cause of action for retaliation with any particularity whatsoever.  No statutory basis for the fifth cause of action for retaliation has even been identified.  Nor has Plaintiff Short included sufficient allegations of his protected activity or Moving Defendants’ retaliatory conduct.  Accordingly, Moving Defendants’ demurrer to the fifth cause of action is SUSTAINED.

Eighth Cause of Action: Overtime Pay

            Moving Defendants contend that the eighth cause of action for failure to pay overtime is improperly brought against Vincent Chan and that Plaintiff Short fails to allege any facts to support the claim that he was a non-exempt employee.

            Under Labor Code section 510, non-exempt employees are entitled to overtime for work in excess of eight hours in one day and work in excess of 40 hours in one work week.  (Id.)  Under Labor Code section 1194, an employee can sue an employer to enforce a failure to pay overtime and/or minimum wages.

            Here, the eighth cause of action is against Defendants CDC and Vincent Chan.  As to Defendant Vincent Chan, Labor Code section 558.1 does permit Plaintiff Short to bring claims against agents of an employers for failure to pay overtime wages.  (Lab. Code, § 510(a).) 

            The SAC merely alleges that “[e]ven though Defendants CDC and Chan treated Plaintiff like an exempt employee, Plaintiff was, in fact, a non-exempt employee. Critically, CDC never paid Plaintiff for all hours worked. Plaintiff worked anywhere from 5-10 hours of overtime every Monday-Friday, worked 6 days per week every single week, and often worked 7 days per week from 8/1/17 to 2/15/22.”  (SAC at p.12:23-26.)  These allegations are insufficient.

            As noted above, statutory claims must be pled with particularity.  (Lopez, supra, 40 Cal.3d at p.795.)  Moreover, the allegation that Short was a non-exempt employee is a conclusion of law without any specific factual allegations to support it.  (Aubry v. Tri-City Hospital Dist. (1992) 2 Cal.4th 962, 967, [“The court does not … assume the truth of contentions, deductions or conclusions of law.”].) 

            Accordingly, Moving Defendants’ demurrer to the eighth cause of action is SUSTAINED.

Ninth Cause of Action: Forcing Plaintiff to be a Part of Loan Fraud in Violation of Civil Code § 1710

            Moving Defendants contend that the ninth cause of action is insufficiently alleged.  The Court agrees.

            “A violation of a state statute does not necessarily give rise to a private cause of action. [Citation.] Instead, whether a party has a right to sue depends on whether the Legislature has ‘manifested an intent to create such a private cause of action’ under the statute. [Citations.]”  (Vasquez v. Solo 1 Kustoms, Inc. (2018) 27 Cal.App.5th 84, 90.)  Civil Code section 1710 provides in full, “[a] deceit, within the meaning of the last section, is either: [¶] 1. The suggestion, as a fact, of that which is not true, by one who does not believe it to be true; [¶] 2. The assertion, as a fact, of that which is not true, by one who has no reasonable ground for believing it to be true; [¶] 3. The 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; or, [¶] 4. A promise, made without any intention of performing it.” 

            The statute merely provides the definition of deceit and is not a substantive statute.  To the extent that Plaintiff Short attempts to state a claim for fraud, the ninth cause of action is woefully insufficient.

            “The elements of fraud are (a) a misrepresentation (false representation, concealment, or nondisclosure); (b) scienter or knowledge of its falsity; (c) intent to induce reliance; (d) justifiable reliance; and (e) resulting damage.”  (Hinesley v. Oakshade Town Center (2005) 135 Cal.App.4th 289, 294.)  “Fraud allegations ‘involve a serious attack on character’ and therefore are pleaded with specificity.  [Citation.]  General and conclusory allegations are insufficient.  [Citation.]  The particularity requirement demands that a plaintiff plead facts which ‘‘‘show how, when, where, to whom, and by what means the representations were tendered.’’’  [Citation.]”  (Cansino v. Bank of America (2014) 224 Cal.App.4th 1462, 1469.)  Moreover, “each element must be pleaded with specificity.  [Citations.]”  (Daniels v. Select Portfolio Servicing, Inc. (2016) 246 Cal.App.4th 1150, 1166 disapproved of on other grounds by Sheen v. Wells Fargo Bank, N.A. (2022) 12 Cal.5th 905.)

            Here, the SAC merely alleges that Moving Defendants lied to vendors and buyers involving a property.  There are no allegations of what specifically was misrepresented, who made these misrepresentations, to whom these misrepresentations were made, where these misrepresentations were made, by what means these misrepresentations were made, nor specifically when these alleged misrepresentations took place.  Moreover, Plaintiff Short fails to allege any actions Short took in reliance on these misrepresentations or any specific damages Short suffered.

            Accordingly, Moving Defendants’ demurrer to the ninth cause of action is SUSTAINED.

Twelfth Cause of Action: Unfair Business Practices

Moving Defendants contend that Short has failed to allege any unfair, unlawful, or fraudulent actions.  The Court disagrees.

The purpose of California’s Unfair Competition Law (“UCL”) “is to protect both consumers and competitors by promoting fair competition in commercial markets for goods and services. [Citation.]” (Kasky v. Nike, Inc. (2002) 27 Cal.4th 939, 949.)  Thus, the UCL prohibits unlawful, unfair or fraudulent business acts or practices.  (Bus. & Prof. Code, § 17200.)  “The Legislature intended this ‘sweeping language’ to include ‘anything that can properly be called a business practice and that at the same time is forbidden by law.’” (Bank of the West v. Sup. Ct. (1992) 2 Cal.4th 1254, 1266.)  “A plaintiff alleging unfair business practices under these statutes must state with reasonable particularity the facts supporting the statutory elements of the violation.” (Khoury v. Maly's of California, Inc. (1993) 14 Cal.App.4th 612, 619.)

“Because the statute is framed in the disjunctive, a business practice need only meet one of the three criteria to be considered unfair competition.”  (Durell v. Sharp Healthcare (2010) 183 Cal.App.4th 1350, 1359.)  Section 17200’s “unlawful” prong “borrows violations of other laws ... and makes those unlawful practices actionable under the UCL.”  (Klein v. Chevron U.S.A., Inc. (2012) 202 Cal.App.4th 1342, 1383.)  “[V]irtually any law or regulation—federal or state, statutory or common law—can serve as [a] predicate for a ... [section] 17200 ‘unlawful’ violation.’ ”  (Ibid.)  “A business practice is “fraudulent” within the meaning of section 17200 if it is “likely to deceive the public.”  (Id. at p.1380.) “‘A business practice is unfair within the meaning of the UCL if it violates established public policy or if it is immoral, unethical, oppressive or unscrupulous and causes injury to consumers which outweighs its benefits.’ [Citation.]”  (Nolte v. Cedars-Sinai Medical Center (2015) 236 Cal.App.4th 1401, 1407–1408.)  The determination of whether a business practice is unfair involves an examination of that practice’s impact on its alleged victim, balanced against the reasons, justifications, and motives of the alleged wrongdoer.  (Ibid.)  In brief, the court must weigh the utility of the defendant's conduct against the gravity of the harm to the alleged victim.  (Nolte, Supra, 236 Cal.App.4th at pp. 1407–1408; Cf. Durell v. Sharp Healthcare, supra, 183 Cal.App.4th at 1365 [“[u]nfair” business practices are those which offend an “established public policy” that is tethered to “specific constitutional, statutory, or regulatory provisions”]; Morgan v. AT & T Wireless Services, Inc. (2009) 177 Cal.App.4th 1235, 1254–1255.)

            Here, Plaintiff has alleged multiple statutory violations that Moving Defendants do not even challenge – i.e., such as the seventh cause of action for violation of Penal Code section 290.4(d)(1)(E).  This statutory violation can serve as an unlawful business practice for purposes of the twelfth cause of action.  Accordingly, Moving Defendants’ demurrer to the twelfth cause of action is OVERRULED.

Thirteenth Cause of Action: Failure to Pay Minimum Wage

            Moving Defendants contend that the thirteenth cause of action for failure to pay minimum wage fails because Short does not allege any facts.

            “‘For the purpose of testing the sufficiency of the cause of action, the demurrer admits the truth of all material facts properly pleaded (i.e., all ultimate facts alleged, but not contentions, deductions or conclusions of fact or law).’ [Citations.]”  (290 Division (EAT), LLC v. City and County of San Francisco (2022) 86 Cal.App.5th 439, 452.)

            Here, the SAC alleges that Moving Defendants JW Associates, LLC and Lawrence Norman Taylor failed to pay Plaintiff Short for work that he did.  Specifically, Short alleges that “From 2017 to 2022, Plaintiff worked 2-10 hours per week for Defendant JW without getting paid for any of it. Some of the work was in Ventura County but some work was also performed in Los Angeles County and in the City of Los Angeles. Defendant TAYLOR owns via some corporate structure the JW property at 1700 Jones Way in Oxnard, CA. When Plaintiff started work for CDC and TAYLOR asked Plaintiff to manage what is essentially his personal property (it’s a car warehouse where TAYLOR keeps a large number of old and raggedy cars), Plaintiff lightly objected. TAYLOR told Plaintiff that Plaintiff would get paid separately by the JW entity for the hours and efforts put into the property. However, that never happened even after Plaintiff broached the subject a number of times.”  (SAC at p.18:4-14.)  These allegations clearly allege that Plaintiff Short was employed by defendant JW Associates, LLC and was not paid.  As to Defendant Lawrence Norman Taylor, acting as an agent of the employer JW Associates, LLC gives rise to liabilty under Labor Code section 558.1(a). 

            Accordingly, Moving Defendants’ demurrer to the thirteenth cause of action is OVERRULED.

Fifteenth Cause of Action: Violation of Labor Code § 970

            Moving Defendants assert that the fifteenth cause of action is not sufficiently alleged.  The Court agrees.

            Pursuant to Labor Code section 970, “[n]o person, or agent or officer thereof, directly or indirectly, shall influence, persuade, or engage any person to change from one place to another in this State or from any place outside to any place within the State, or from any place within the State to any place outside, for the purpose of working in any branch of labor, through or by means of knowingly false representations, whether spoken, written, or advertised in printed form, concerning either: [¶] (a) The kind, character, or existence of such work; [¶] (b) The length of time such work will last, or the compensation therefor; [¶] (c) The sanitary or housing conditions relating to or surrounding the work; [¶] (d) The existence or nonexistence of any strike, lockout, or other labor dispute affecting it and pending between the proposed employer and the persons then or last engaged in the performance of the labor for which the employee is sought.

            Here, the SAC merely alleges that “[a]s an inducement for Plaintiff join Defendant CDC as an employee, Plaintiff negotiated – and Defendants CDC, TAYLOR, and CHAN offered – a quarterly bonus incentive plan since Defendants could not afford to pay the salary Plaintiff could command elsewhere. Plaintiff earned quarterly bonuses the first few quarters of Plaintiff’s employment. However, Plaintiff’s bonus program was halted in 2018/2019. Plaintiff was not given the opportunity to earn bonuses from 2018/2019 to 2022 save for one random bonus of $2,500.00 or so in 2020 or 2021.”  (SAC at p.19:10-16.)  However, there is no allegation that Plaintiff Short was convinced to relocate due to the employment offer.

            Accordingly, Moving Defendants’ demurrer to the fifteenth cause of action is SUSTAINED.

Sixteenth Cause of Action: Wrongful Termination

Moving Defendants assert that the individual defendants are not Plaintiff Short’s employers, and thus, the sixteenth cause of action fails against them.

An employee has a common law right to sue for wrongful termination “when he or she is discharged for performing an act that public policy would encourage, or for refusing to do something that public policy would condemn.”  (Gantt v. Sentry Insurance (1992) 1 Cal.4th 1083, 1090 overruled on other grounds by Green v. Ralee Engineering Co. (1998) 19 Cal.4th 66.)  “‘The elements of a claim for wrongful discharge in violation of public policy are (1) an employer-employee relationship, (2) the employer terminated the plaintiff’s employment, (3) the termination was substantially motivated by a violation of public policy, and (4) the discharge caused the plaintiff harm.’”  (Nosal-Tabor v. Sharp Chula Vista Medical Center (2015) 239 Cal.App.4th 1224, 1234-35 (quoting Yau v. Allen (2014) 229 Cal.App.4th 144, 154).)  “A discharge is actionable as against public policy if it violates a policy that is: ‘(1) delineated in either constitutional or statutory provisions; (2) ‘public’ in the sense that it ‘inures to the benefit of the public’ rather than serving merely the interests of the individual; (3) well established at the time of discharge; and (4) ‘substantial’ and ‘fundamental.’’”  (Id. at 1238-39 [quoting Carter v. Escondido Union High School District (2007) 148 Cal.App.4th 922, 929].) 

            “The tort we recognized in Tameny, and reaffirmed in Gantt, is premised on the wrongful termination of an employment relationship. If an employer terminates an employment relationship for a reason that contravenes some fundamental public policy, then the employer breaches a general duty imposed by law upon all employers and the employee's remedy therefore sounds in tort.”  (Miklosy v. Regents of University of California (2008) 44 Cal.4th 876, 900.)  However, “the breach of the employment relationship is an indispensable element of the tort, because it serves factually as the instrument of injury. Thus, there can be no Tameny cause of action without the prior existence of an employment relationship between the parties.”  (Ibid.)  Accordingly, “ ‘the duty on which the tort is based is a creature of the employer-employee relationship, and the breach of that duty is the employer's improper discharge of an employee otherwise terminable at the will or whim of the employer. [Citation.] There is nothing in ... any ... case we have found to suggest that this tort imposes a duty of any kind on anyone other than the employer. Certainly, there is no law we know of to support the notion that anyone other than the employer can discharge an employee.’ [Citation.]”  (Id. at p.901.)  Thus, “the common law Tameny cause of action for wrongful termination in violation of public policy lies only against an employer.”  (Ibid.) 

            Here, the wrongful termination claim is alleged against – in relevant part – defendants Vincent Chan and Lawrence Norman Taylor.  There is no allegation that Vincent Chan or Lawrence Norman Taylor were Plaintiff Short’s employer.  Accordingly, there is no basis for a wrongful termination claim against them.

            Therefore, Vincent Chan and Lawrence Norman Taylor’s demurrer to the sixteenth cause of action is SUSTAINED.

Seventeenth Cause of Action: OSHA Violations

            Moving Defendants assert that Plaintiff fails to set forth any statutory basis to bring a civil lawsuit for OSHA violations. 

            “A violation of a state statute does not necessarily give rise to a private cause of action. [Citation.] Instead, whether a party has a right to sue depends on whether the Legislature has ‘manifested an intent to create such a private cause of action’ under the statute. [Citations.]”  (Vasquez v. Solo 1 Kustoms, Inc. (2018) 27 Cal.App.5th 84, 90.) 

            Here, Short fails to even cite any statute to identify the specific basis for his claim for unstated OSHA violations.  Regardless, there is no basis set forth in the SAC for Plaintiff Short to bring a civil action to enforce OSHA violations against Moving Defendants.

            Accordingly, Moving Defendants’ demurrer to the seventeenth cause of action is SUSTAINED.

Eighteenth Cause of Action: Whistle Blower Retaliation

            Moving Defendants assert that the fifth and eighteenth causes of action fail because the alleged complaints were not made to government or law enforcement agency.

            “ ‘ “ ‘To establish a prima facie case of [whistle blower] retaliation, [1] a plaintiff must show that she engaged in protected activity, that [2] she was thereafter subjected to adverse employment action by her employer, and [3] there was a causal link between the two.’ ” ’ [Citation.]”  (Soukup v. Law Offices of Herbert Hafif (2006) 39 Cal.4th 260, 287–288.)  “Section 1102.5 provides whistleblower protections to employees who disclose wrongdoing to authorities.”  (Lawson v. PPG Architectural Finishes, Inc. (2022) 12 Cal.5th 703, 709.)  However, “Section 1102.5, subdivision (b), concerns employees who report to public agencies. It does not protect plaintiff, who reported his suspicions directly to his employer.”  (Green v. Ralee Engineering Co. (1998) 19 Cal.4th 66, 77.)

            Here, the SAC alleges that Plaintiff Short reported the alleged loan fraud to defendant Vincent Chan.  (SAC at p.21:20-24.)  Defendant Vincent Chan is an agent of the employer, (SAC at p.4:10-18), and thus a complaint to Chan does not fall within the purview of the whistleblower protection statute.   Accordingly, Moving Defendants’ demurrer to the eighteenth cause of action is SUSTAINED.

Leave to Amend

Leave to amend must be allowed where there is a reasonable possibility of successful amendment. (Goodman v. Kennedy (1976) 18 Cal.3d 335, 348.) The burden is on the plaintiff to show the court that a pleading can be amended successfully. (Goodman v. Kennedy, supra, 18 Cal.3d at p.348; Lewis v. YouTube, LLC (2015) 244 Cal.App.4th 118, 226.) 

Though it is unclear whether Short’s claims can be successfully amended, the Court has not previously sustained any demurrer on these grounds.  The court finds it is proper to allow Plaintiffs an opportunity to cure the defects discussed in this order. (See Goodman v. Kennedy (1976) 18 Cal.3d 335, 349; Kong v. City of Hawaiian Gardens Redevelopment Agency (2002) 108 Cal.App.4th 1028, 1037.) 

CONCLUSION AND ORDER

Based on the forgoing, Defendants Christina Development Corporation, Christina Properties Limited, David Allen Whitehead, Lawrence Norman Taylor, Adam Jacob Rosenkranz, Vincent Chan, Connor Stephen Wilks, JW Associates, LLC, Empire View Homes, LLC, and Crescent Hill Lofts, LLC’s demurrer to Plaintiff Steven Raymond Short’s Second Amended Complaint is SUSTAINED IN PART as to first, second, third, fifth, sixth, eighth, ninth, fourteenth, fifteenth, seventeenth, and eighteenth causes of action WITH LEAVE TO AMEND.  As to Defendants Vincent Chan and Lawrence Norman Taylor only, Defendants’ demurrer to the sixteenth cause of action is SUSTAINED WITH LEAVE TO AMEND.

Defendants’ demurrer is otherwise OVERRULED.

Plaintiff is to file and serve a Third Amended Complaint within 30 days.  The case management conference is continued to February 29, 2024 at 8:30 am.

The Court notes that on August 2, 2023, Steve Short filed a Motion to Compel Arbitration without any accompanying memorandum of points and authorities and without any evidence.  Steve Short noticed this Motion to Compel Arbitration for today, December 14, 2023.  However, on December 12, 2023, Steve Short contacted the Courtroom Assistant for this department and notified that he was taking his motion to compel arbitration set for December 14, 2023 off calendar.

Moving Parties shall give notice and file proof of service of such.

DATED: December ___, 2023                                               ___________________________

                                                                                          Elaine Lu

                                                                                          Judge of the Superior Court