Judge: Elaine W. Mandel, Case: 23SMCV05898, Date: 2024-06-18 Tentative Ruling

Case Number: 23SMCV05898    Hearing Date: June 18, 2024    Dept: P

Tentative Ruling

Hudson v. FCI 2 Holdings, LLC, et al., Case No. 23SMCV05898

Hearing date June 18, 2024

Defendants FCI Holdings, LLC, Peyman Jacob Yadegar, Kambiz Yadegar, Romero, and Battimo’s (1) Demurrer and (2) Motion to Strike

Plaintiff tenant sues defendant landlords/property managers, alleging defendants attempted to force him from the property, violated LARSO and various habitability issues, as well as age and racial discrimination.

Plaintiff alleged: (1) violation of Business & Professions Code §17200, (2) violation of LARSO, (3) racial harassment/FEHA, (4) violation of Unruh Civil Rights Act, (5) breach of contract, (6) breach of implied warranty of habitability, (7) breach of covenant of quiet enjoyment, (8) fraud, and (9) intentional infliction of emotional distress.

Defendants FCI Holdings, LLC (also erroneously sued and served as FCI2 Holdings, LLC) (FCI), Peyman Jacob Yadegar, Kambiz Yadegar, Romero, and Battimo demur to the complaint as a whole to the extent it is alleged against FCI2 Holdings, LLC, Peyman Jacob Yadegar, Kambiz Yadegar, Romero and Battimo, arguing misjoinder and failure to state a claim. Defendants also move to strike punitive damages.

In reviewing the legal sufficiency of a complaint against a demurrer, a court will treat the demurrer as admitting all material facts properly pleaded. 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. A “demurrer lies only for defects appearing on the face of the complaint[.]” Stevens v. Superior Court (1999) 75 Cal.App.4th 594, 601. 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.

A special demurrer for uncertainty is appropriate where the pleading is so poorly written that defendant cannot reasonably respond.¿Code Civ. Proc. §430.10(f); Khoury v. Maly’s of California, Inc. (1993) 14 Cal.App.4th 612, 616. A demurrer for uncertainty is a disfavored ground for sustaining a demurrer. Id.

Judicial Notice

Defendants request the court to take judicial notice of Exhibit A, the California Secretary of State Business Search Results for searches of “FCI2 Holdings” and “FCI 2 Holdings” under Evidence Code section 452(h). Granted without opposition.

Incorrect Entity Name

Defendants argue defendant FCI 2 Holdings, LLC is not a valid entity, so the complaint is uncertain and plaintiff’s causes of action cannot be properly alleged against it.

In plaintiff’s statement of no opposition to defendants’ Request for Judicial Notice, he claims: “The fact that ‘FCI 2 Holdings, LLC’ apparently does not appear as a registered limited liability company with the Secretary of State establishes a key element of Mr. Hudson’s charging

allegations against FCI 2 Holdings, LLC . . . namely, that it was, in fact, an unregistered limited liability company. That unregistered limited liability company [nevertheless] did conduct business in California (at least with respect to Mr. Hudson) that it had no legal right to conduct.” Plaintiff's Statement of No Opposition, p. 2.

In the complaint, plaintiff states on 10/4/22, FCI 2 Holdings, LLC filed an unlawful detainer action against plaintiff: FCI 2 Holdings, LLC v. Herbert Hudson, Case No. 22SMUD01466. Compl. ¶20. On 2/1/23, the unlawful detainer action was dismissed, and Hudson obtained a judgment for costs against FCI 2 Holdings, LLC, which remains unpaid. Compl. ¶22. Plaintiff alleges FCI 2 Holdings, LLC has been used to hide and shelter income that otherwise would be attributed to FCI, Peyman Jacob Yadegar, and Kambiz Yadegar, in furtherance of a scheme. Compl. ¶24. Additionally, he alleges FCI 2 Holdings, LLC filed the unlawful detainer action to shield the other defendants from liabilities associated with their plot to force plaintiff out of his leased property. Compl. ¶24.

The court cannot conclude from the face of the complaint and the judicially noticed search results that FCI 2 Holdings, LLC is an improper party. The court accepts the allegations in paragraphs 20, 22, and 24 of the complaint as true. If FCI 2 Holdings, LLC is found to be an improper party in the future, such can be the subject of motion practice. OVERRULED.

Individual Defendants

Defendants argue the complaint lacks allegations against individual defendants, Peyman Jacob Yadegar, Kambiz Yadegar, Romero and Battimo in their individual capacities, and the complaint solely contains allegations against FCI because actions taken by individual defendants were solely conducted on behalf of FCI. Defendants argue neither Romero nor Battimo are managers or officers of FCI, and the complaint does not allege such.

The complaint alleges Peyman Jacob Yadegar and Kambiz Yadegar were managers, members, owners, and alter egos of FCI 2 Holdings, LLC. Compl. ¶¶2, 4-5. The complaint alleges Romero and Battimo acted as agents and/or employees of FCI Holdings, LLC and the “shell” company, FCI 2 Holdings, LLC, with Battimo acting as the on-site manager at the property. Compl. ¶¶ 6-7, 14. The complaint alleges all defendants were involved in actions that deprived plaintiff of the benefits of his tenancy at the rental property. These allegations are sufficient to state a cause of action against the individual defendants. OVERRULED.

Motion to Strike Punitive Damages

To support a prayer for punitive damages, the complaint must allege “oppression, fraud, or malice.” Cyrus v. Haveson (1976) 65 Cal.App.3d 306, 316-17. “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.” Civ. Code §3294.

Plaintiff alleges failure to repair water leaks (Compl. ¶18), failed to upgrade his unit consistent with work done in other units (Compl. ¶17), deprive plaintiff of his parking spaces (Compl. ¶19), overcharging and double charging the monthly rent (Compl. ¶ 23), taking unwarranted and improper actions to evict plaintiff, including filing the UD action (Compl. ¶20). The allegations sufficiently allege malice for pleading purposes within the meaning of Civil Code section 3294. DENIED