Judge Frank M. Tavelman, Case 22BBCV00656 2023-01-18 Tentative Ruling

TENTATIVE RULING

JANUARY 18, 2023

(Continued from January 13, 2023)

Los Angeles Superior Court Case # 22BBCV00656

Wayan Palmieri and Natalia Palmieri ("Plaintiffs") filed suit against Equity Residential Management, LLC (“Defendant”), alleging that Defendant failed to comply with the statutory requirements when Plaintiffs applied for housing at Defendant’s property. Plaintiffs allege that Defendant improperly procured consumer reports pertaining to Plaintiffs and that Plaintiffs were harmed as such. Plaintiffs filed the Complaint on September 15, 2022 alleging three causes of action: (1) violation of the Investigative Consumer Reporting Agencies Act (“ICRAA”); (2) invasion of privacy; and (3) declaratory relief under C.C.P. §1060.

The Court received the Demurrer and Motion to Strike filed by Defendant on October 19, 2022; the opposition filed by Plaintiff on December 30, 2022; and the reply filed by Defendant on January 6, 2023.

The grounds for a demurrer must appear on the face of the pleading or from judicially noticeable matters. (C.C.P. § 430.30(a); Blank v. Kirwan (1985) 39 Cal. 3d 311, 318.) A demurrer for sufficiency tests whether the complaint states a cause of action. (Hahn v. Mirda (2007) 147 Cal.App.4th 740, 747.) The only issue involved in a demurrer hearing is whether the complaint states a cause of action. (Ibid.)

A demurrer assumes the truth of all factual, material allegations properly pled in the challenged pleading. (Blank v. Kirwan, supra, 39 Cal. 3d at p. 318.) No matter how unlikely or improbable, the plaintiff’s allegations must be accepted as true for the purpose of ruling on the demurrer. (Del E. Webb Corp. v. Structural Materials Co. (1981) 123 Cal. App. 3d 593, 604.) But this does not include contentions; deductions; conclusions of fact or law alleged in the complaint; facts impossible in law; or allegations contrary to facts of which a court may take judicial notice. (Blank, supra, 39 Cal. 3d at p. 318.)

Pursuant to C.C.P. §§ 430.10(e) and (f), the party against whom a complaint has been filed may demur to the pleading on the grounds that the pleading does not state facts sufficient to constitute a cause of action, or that the pleading is uncertain, ambiguous and/or unintelligible. It is an abuse of discretion to sustain a demurrer if there is a reasonable probability that the defect can be cured by amendment. (Schifando v. City of Los Angeles (2003) 31 Cal. 4th 1074, 1082, as modified (Dec. 23, 2003).)

CCP § 430.41(a) requires that the demurring party meet and confer with the party who filed the pleading that is subject to the demurrer at least 5 days before the date the responsive pleading is due, by telephone or in person, for the purpose of determining if the parties can resolve the objections to be raised in the demurrer. The demurring party must file and serve a declaration detailing their meet and confer efforts. Failure to meet and confer is not grounds to overrule or sustain a demurrer, or grant or deny a motion to strike. (CCP §§ 430.41(a)(4); CCP 435.5(a)(4).)

Upon review of the record the Court finds that meet and confer requirements have been satisfied to code. (Farag Demurrer Decl., ¶¶ 4-5.)

The court may take judicial notice of “official acts of the legislative, executive, and judicial departments of the United States and of any state of the United States,” “[r]ecords of (1) any court of this state or (2) any court of record of the United States or of any state of the United States,” and “[f]acts and propositions that are not reasonably subject to dispute and are capable of immediate and accurate determination by resort to sources of reasonably indisputable accuracy.” (Evid. Code § 452(c), (d), and (h).)¿¿

Defendant and Plaintiffs both request judicial notice be taken of orders on Demurrers and Motions to Strike made in similar cases involving Defendant. Plaintiff objects to the judicial notice on the grounds that: (1) such orders are irrelevant; (2) cannot be legal precedent for anything in this case; (3) are hearsay, and (4) are not authenticated. Regardless, Plaintiff also submits an order on a Demurrer and Motion to strike for judicial notice.

“A court may judicially notice the “[r]ecords of ... any court of this state.” (Evid. Code, § 452, subd. (d).) “We may take judicial notice of the existence of judicial opinions and court documents, along with the truth of the results reached—in documents such as orders, statements of decision, and judgments—but cannot take judicial notice of the truth of hearsay statements in decisions or court files, including pleadings, affidavits, testimony, or statements of fact.” (Aixtron, Inc. v. Veeco Instruments Inc. (2020) 52 Cal.App.5th 360 quoting Williams v. Wraxall (1995) 33 Cal.App.4th 120, 130.)

The Court SUSTAINS Plaintiff’s objection to the judicial notice of the ruling in Cary Singleton et al v. Equity Residential Management, LLC. The Court cannot take notice of the truth of the statements of fact relied upon by this order. The Court agrees with Plaintiff that because only the existence of the orders can be noticed, they are of little to no relevance to the instant motion. Under this same logic, the Court DECLINES to take judicial notice of the order in Dwight Evans, et al. v. Equity Residential Management, LLC as requested by Plaintiff.

“An actionable claim [for invasion of privacy] requires three essential elements: (1) the claimant must possess a legally protected privacy interest; (2) the claimant’s expectation of privacy must be objectively reasonable; and (3) the invasion of privacy complained of must be serious in both its nature and scope.” (County of Los Angeles v. Los Angeles County Employee Relations Commission (2013) 56 Cal.4th 905, 926)

Defendant claims that Plaintiffs did not have a reasonable expectation of privacy; Plaintiffs voluntarily completed their applications and consented to the release of their information through investigative consumer reports. (Demur. p. 2-3; Compl. ¶¶ 15, 17, 19.) Defendant’s cite to Sheehan v. San Francisco 49ers, Ltd. (2009) 45 Cal.4th 992 and its interpretation of the standards set out by Hill v. National Collegiate Athletic Assn. (1994) 7 Cal.4th 1. Defendant invokes Sheehan claiming that voluntary consent generally precludes a finding that the privacy invasion is so offensive as to justify tort liability. While this is true, the court in Sheehan also clarified that Hill’s interpretation of consent depends on context. (Ibid. at 998.) The Sheehan court clarified that just because a party has consented to one form of search does not mean they have consented to all forms. (Ibid. at 1001.)

Plaintiffs did not sufficiently alleged a reasonable expectation of privacy. Plaintiffs argue that even with consent to a “release of information permitting the Defendants to get private and personal information from third parties about the Plaintiffs as required for all applications by the Property Owner” they still “have a reasonable expectation of privacy in the reports about them and a reasonable expectation that such reports will not be obtained without complying with the ICRAA.” (Oppo. p. 2.) While it may be true that Plaintiffs may reasonably expect Defendants’ compliance with ICRAA, any failure in this instance does not necessarily result in an invations of privacy to the material which the Plaintiffs consented.

Plaintiffs’ invasion of privacy claim stems from allegations that: (1) Defendant failed to inform Plaintiffs that a consumer report would be made; and (2) failed to provide a copy of this report within three days of its creation. Plaintiffs’ allegation that they signed a form acknowledging that private information would be released undermines their conclusory allegation that they held a reasonable expectation of privacy in the contents of any consumer report generated with their permission.

Plaintiffs argue they have a reasonable expectation that investigative consumer reports about them will comply with the ICRAA;the Complaint states, “[w]ithout disclosure to Plaintiffs and other persons about whom such investigative consumer reports are written, Plaintiffs would not be able to read the reports and demand that errors be corrected, and Plaintiffs would not even known if such reports were being used against him or her.” (Oppo. p. 2; Compl. ¶ 3.)

Plaintiffs have alleged that they have a reasonable expectation of ICRAA compliance; however, these allegations do not speak to the elements of an invasion of privacy claim. The failure to provide the report obtained with Plaintiffs’ consent may constitute an ICRAA violation, but Plaintiffs have not alleged sufficient facts as to how a failure to do so violates their privacy interest.

Defendant’s demurrer to the second cause of action for invasion of privacy is SUSTAINED with leave to amend.

“To qualify for declaratory relief, a party would have to demonstrate its action presented two essential elements: (1) a proper subject of declaratory relief, and (2) an actual controversy involving justiciable questions relating to the party’s rights or obligations.” (Jolley v. Chase Home Finance, LLC (2013) 213 Cal.App.4th 872, 909, quotation marks and brackets omitted.)

A cause of action for declaratory relief should not be used as a second cause of action for the determination of identical issues raised in another cause of action. (General of America Insurance Co. v. Lilly (1968) 258 Cal.App.2d 465, 470.)

Defendant claims that “Plaintiffs’ request for declaratory relief is merely a concealed attempt to obtain an advisory opinion from the court regarding a hypothetical controversy that does not presently exist.” (Demur. p. 5.) This is premised on the fact that Plaintiffs’ claims are based on Defendant’s violations of the ICRAA in connection with the application process, but Plaintiffs claim there is an ongoing controversy because Defendant requires all leases to be renewed or re-certified and uses the same forms which authorize investigative consumer reports. (Oppo. p. 3.)

Here, Plaintiffs cannot sufficiently allege facts supporting an actual controversy with Defendant because the Complaint does not sufficiently allege that a future controversy is guaranteed to occur. Plaintiffs allege that Defendant will continue to violate the ICRAA by stating that “judicial determination is necessary to prevent [Defendant’s] continued violations of the ICRAA.” (Compl. ¶ 49.) Plaintiffs also claim that Defendant requires all leases to be renewed or re-certified and that Defendant uses the same forms which authorize Defendant to obtain investigative consumer reports. (Oppo. p. 3.) However, Plaintiffs have not sufficiently alleged harm because the Plaintiffs do not claim they intend to renew their leases. The Court finds the alleged controversy does not presently exist and whatever future harm Plaintiffs refer to will not necessarily involve them. Thus, Plaintiffs have failed to allege no basis for declaratory relief.

Defendant’s demurrer as to the third cause of action is SUSTAINED with leave to amend.

The Court thus SUSTAINS the demurrer as to the second and third cause of action with 20 days’ leave to amend.

Motions to strike are used to reach defects or objections to pleadings that are not challengeable by demurrer, such as words, phrases, and prayers for damages. (See C.C.P. §§ 435, 436, and 437.) The proper procedure to attack false allegations in a pleading is a motion to strike. (C.C.P. § 436(a).) In granting a motion to strike made under C.C.P. § 435, “[t]he court may, upon a motion made pursuant to Section 435 [notice of motion to strike whole or part of complaint], or at any time in its discretion, and upon terms it deems proper: (a) Strike out any irrelevant, false, or improper matter inserted in any pleading.” (C.C..P § 436(a).) Irrelevant matters include immaterial allegations that are not essential to the claim or those not pertinent to or supported by an otherwise sufficient claim. (C.C.P. § 431.10.) The court may also “[s]trike out all or any part of any pleading not drawn or filed in conformity with the laws of this state, a court rule, or an order of the court.” (C.C.P. § 436 (b).)

To succeed on a motion to strike punitive damages allegations, it must be said as a matter of law that the alleged behavior was not so vile, base, or contemptible that it would not be looked down upon and despised by ordinary decent people. (Angie M. v. Superior Court (1995) 37 Cal. App. 4th 1217, 1228-1229.)

CCP § 435.5(a) provides that before filing a motion to strike, the moving party shall meet and confer in person or by telephone with the party who filed the pleading that is subject to the motion to strike for the purpose of determining if an agreement can be reached that resolves the objections to be raised in the motion to strike.

Upon review of the record the Court finds that meet and confer requirements have been satisfied to code. (Farag Strike Decl., ¶¶ 4-5.)

Under the statute, the remedies for a violation of the ICRAA does not include injunctive relief. Under the ICRAA because remedies are limited to damages and attorneys’ fees. (C.C.P. §§ 1786.50(a)(1)-(2).)The Court GRANTS Defendant’s motion to strike Paragraph 45 from Plaintiffs’ Complaint; Similarly, the court GRANTS Defendant’s motion to strike the portion of Paragraph 43 from Plaintiffs’ Complaint which requests injunctive relief under ICRAA.

Defendant’s motion to strike Paragraphs 8 through 10 of from the Prayer for Relief on the ground that there is no basis stated in the Complaint for Plaintiffs’ requests for declaratory and injunctive relief is moot due to the Court’s sustaining the demurrer to the declaratory relief cause of action. It is unclear whether the Complaint prays for injunctive relief as to the invasion of privacy claim, and thus unclear whether Defendant’s motion requests to strike such relief. Regardless, considering the Court’s ruling sustaining the demurrer on the invasion of privacy claim the motion would be moot.

“In order to survive a motion to strike an allegation of punitive damages, the ultimate facts showing an entitlement to such relief must be pled by a plaintiff. [Citations.]” (Clauson v. Superior Court, (1998) 67 Cal.App.4th 1253, 1255.) In order to state a prima facie claim for punitive damages, a complaint must set forth the elements as stated in the general punitive damage statute, Civil Code Section 3294. (College Hospital, Inc. v. Superior Court, (1994) 8 Cal. 4th 704, 721.) These statutory elements include allegations that the defendant has been guilty of oppression, fraud or malice. (C.C.P. § 3294 (a).) “Malice is defined in the statute as conduct 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.” (College Hospital, Inc. v. Superior Court, at 725.) “The mere allegation an intentional tort was committed is not sufficient to warrant an award of punitive damages. [Citation.] Not only must there be circumstances of oppression, fraud or malice, but facts must be alleged in the pleading to support such a claim. [Citation.]” (Grieves v. Superior Ct., (1984) 157 Cal.App.3d 159, 166, fn. omitted.)

The Court DENIES Defendant’s motion to strike Paragraphs 6, 31, and 43 of Plaintiffs’ Complaint and Paragraph 4 of the Prayer for Relief on the ground that Plaintiffs have not properly alleged oppression, fraud, or malice to warrant an award of punitive damages.

Plaintiffs claim that the ICRAA provides for punitive damages for grossly negligent or willful violations, and that Plaintiffs have properly alleged this in their Complaint by stating Defendant’s “violations of the ICRAA was [sic] and is willful and grossly negligent.” (C.C.P. § 1786.50(b).) As referenced in Defendant’s reply, these allegations alone are insufficient because Plaintiffs’ statements are legal conclusions and are not supported by specific facts which show how they were willful and grossly negligent. However, Plaintiffs do properly allege malice by alleging Defendant’s “awareness of and willful failure to follow the governing laws concerning such authorizations,” and Defendant’s “deliberate or reckless disregard of … the rights of the Plaintiffs’” in their lease which resulted in the procurement of Plaintiffs’ confidential and private information. (Compl. p.7 & 10.) Defendant replies that Plaintiff’s opposition does not reference the pleading standard and only makes legal conclusions. Plaintiffs’ opposition makes clear that is addressing the standard of proof for malice and referencing specific allegations in the Complaint which allege malice.

Defendant’s motion to strike is GRANTED as to Complaint Paragraphs 45, 43 [only as to the request for injunctive relief], and DENIED as to Paragraphs 6, 31, and 43 of the complaint and Paragraph 4 of the Prayer for Relief. Defendant’s motion to strike Prayer for Relief Paragraphs 8 through 10 is moot in light of the Court’s ruling on the demurrer.

In the event the parties submit on this tentative ruling, or a party requests a signed order or the court in its discretion elects to sign a formal order, the following form will be either electronically signed or signed in hard copy and entered into the court’s records.

Defendant Equity Residential Management, LLC’s Demurrer and Motion to Strike came on regularly for hearing on August 12, 2022, with appearances/submissions as noted in the minute order for said hearing, and the court, being fully advised in the premises, did then and there rule as follows:

THE MOTION TO STRIKE IS GRANTED AS TO THE PORTION OF PARAGRAPH 43 REQUESTING INJUNCTIVE RELIEF UNDER ICRAA.

THE MOTION TO STRIKE IS MOOT AS TO PARAGRAPHS 8 THOUGH 10 OF THE PRAYER FOR RELIEF.