Judge: Frank M. Tavelman, Case: 22BBCV00656, Date: 2024-01-26 Tentative Ruling
Case Number: 22BBCV00656 Hearing Date: January 26, 2024 Dept: A
DEMURRER
& MOTION TO STRIKE
Los Angeles Superior Court
Case # 22BBCV00656
MP: TransUnion Rental Screening Solutions,
Inc. (Defendant)
RP: Wayan and Natalia Palmieri (Plaintiffs)
The Court is not requesting oral argument on this matter. Pursuant to California Rules of Court, Rule 3.1308(a)(1) notice of intent to appear is required. Unless the Court directs argument in the Tentative Ruling, no argument will be permitted unless a “party notifies all other parties and the court by 4:00 p.m. on the court day before the hearing of the party’s intention to appear and argue. The tentative ruling will become the ruling of the court if no notice of intent to appear is received.”
Notice may be given either by email at
BurDeptA@LACourt.org or by telephone at (818) 260-8412.
ALLEGATIONS:
Wayan Palmieri and Natalia Palmieri (“Plaintiffs”) bring this action against Equity Residential Management, LLC (“Equity Residential”) and TransUnion Rental Screening Solutions, Inc. (“TransUnion”) (collectively “Defendants”), alleging that Defendants failed to comply with statutory requirements when Plaintiffs applied for housing with Equity Residential. Plaintiffs allege that Defendants improperly procured consumer reports pertaining to Plaintiffs and that Plaintiffs were harmed as such. Plaintiffs’ initial Complaint stated three causes of action for: (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 previously sustained a demurrer brought by Equity Residential to the second and third causes of action in Plaintiffs’ Complaint for Invasion of Privacy and Declaratory Relief with leave to amend. Plaintiffs subsequently filed a First Amended Complaint (“FAC”) asserting a singular cause of action against TransUnion for violations of the ICRAA.
Before the Court is demurrer
brought by Transunion to the FAC. While Plaintiffs appear to have abandoned
their causes of action for invasion of privacy and declaratory relief,
TransUnion demurs to them regardless. Accordingly, the Court will only address
the demurrer as it relates to the remaining cause of action for violations of
the ICRAA.
I.
LEGAL
STANDARDS
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. (Id.)
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 318.)
Pursuant to Code of Civil Procedure (“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 without leave to amend 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.)
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.)
II. MERITS
Meet and Confer
C.C.P. §§ 430.41(a) and 435.5(a) requires that the moving
party meet and confer with the party who filed the pleading that is subject to
the demurrer and/or motion to strike. Upon review the Court finds the meet and
confer requirements were met. (Singh Decl. ¶¶ 3-6.)
Demurrer
The purpose of ICRAA is “to ensure that consumer reporting agencies ‘exercise their grave responsibilities with fairness, impartiality, and a respect for the consumer’s right to privacy.’” (Connor v. First Student, Inc (2018) 5 Cal.5th 1026, 1032.) “[T]he statute defines an ‘investigative consumer report’ as one ‘in which information on a consumer’s character, general reputation, personal characteristics, or mode of living is obtained through any means.’” (Id., citing Civ. Code, § 1786.2(c).)
Plaintiffs allege that Equity Residential and TransUnion, in procuring the reports, failed to comply with disclosure and authorization requirements under the Investigative Consumer Reports Agency Act (ICRAA), Civ. Code §§ 1786, et seq. (FAC. ¶ 15.) Defendants allegedly “concealed from Plaintiffs the nature and type of the investigative consumer reports they would procure about the Plaintiffs, the date the reports would be procured, the entity or entities which would provide the reports, and Plaintiffs’ rights regarding investigative consumer reports,” and “did not provide a means by which the Plaintiffs could indicate that he or she wished to receive a copy of any report prepared in connection with the application.” (FAC. ¶¶ 23-24.)
TransUnion argues that because they are a consumer reporting agency, not a landlord, they are not subject to action brought under ICRAA. TransUnion cites to no legal authority for this assertion, instead presenting the declaration of Vanessa Armbruster, TransUnion’s Operations Lead. Armbruster states that TransUnion is not a landlord, is not an entity that requests investigative consumer reports, and is not an entity that procures or causes a report to be made. (Armbruster Decl. ¶ 3.)
The Court finds that TransUnion’s argument does not speak to the standard of a demurrer. Whether TransUnion is subject to an action under ICRAA requires both a determination of law and fact, neither of which is the subject of a demurrer. Armbruster’s declaration is not the subject of judicial notice nor part of Plaintiffs’ Complaint. A court may not “convert a demurrer into an incomplete evidentiary hearing in which the demurring party can present documentary evidence and the opposing party is bound by what that evidence appears to show.” (Fremont Indemnity Co. v. Fremont General Corp. (2007) 148 Cal.App.4th 97, 115.) Furthermore, many of Armbruster’s statements are conclusions of law whose admissibility is questionable in this case. Nothing about Armbruster’s position as an Operations Lead qualifies her statement that TransUnion is not subject to an action under ICRAA.
Accordingly, the demurrer to the first cause of action is OVERRULED.
Motion to Strike
The Court notes that TransUnion’s motion to strike appears to be based upon Plaintiffs’ Complaint and not the FAC. As such, the paragraphs referred to in TransUnion’s memorandum are incongruent with the operative pleading. Regardless, TransUnion’s motion to strike essentially seeks to strike (1) Plaintiffs’ request for injunctive relief, (2) Plaintiffs’ claims for damages/fees, and (3) Plaintiffs’ request for punitive damages. Despite the discrepancy in numbering of specific paragraphs, all of the requests sought to be stricken are present in Plaintiffs’ FAC. As such the Court will address each motion accordingly.
General Damages/ Fees
TransUnion’s only argument in support of their motion to strike Plaintiffs’ claim for damages/fees is that Plaintiffs cannot sustain a cause of action under ICRAA against TransUnion. As the Court has previously explained, this argument is not dispositive at this stage of litigation. As the Court has overruled TransUnion’s demurrer, there is no basis to strike Plaintiffs’ claims for damages/fees and the motion is DENIED.
Injunctive Relief
(a) An investigative
consumer reporting agency or user of information that fails to comply with any
requirement under this title with respect to an investigative consumer report
is liable to the consumer who is the subject of the report in an amount equal
to the sum of all the following:
(1) Any actual
damages sustained by the consumer as a result of the failure or, except in the
case of class actions, ten thousand dollars ($10,000), whichever sum is
greater.
(2) In the case of
any successful action to enforce any liability under this chapter, the costs of
the action together with reasonable attorney's fees as determined by the court.
(b) If the court determines that the violation was grossly negligent or willful, the court may, in addition, assess, and the consumer may recover, punitive damages.
In the opposition, Plaintiffs argue that TransUnion cites to non-binding federal authority in support of the assertion that “[t]he ICRAA is limited to damages and attorney's fees.” Regardless, Plaintiffs do not address the fact that Civil Code §1786.50 presents no statutory basis for injunctive relief. It appears from the plain language of the statute that injunctive relief is not a method of relief which is authorized or even contemplated. Accordingly, the motion to strike is GRANTED as to this issue.
Punitive Damages
TransUnion also asserts that Plaintiffs’ request for punitive damages should be stricken. TransUnion cites to Turman v. Turning Point of Central California, Inc., where the Court of Appeal noted that “[i]n 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...These statutory elements include allegations that the defendant has been guilty of oppression, fraud or malice.” (Turman v. Turning Point of Central California, Inc. (2010) 191 Cal.App.4th 53, 63.) TransUnion argues Plaintiffs have failed to state any facts to show that TransUnion’s conduct, if any, amounted to malice, oppression, or fraud.
Plaintiffs assert that the ICRAA contains its own standard pertaining to punitive damages, citing to Civil Code § 1786.50 (b), which provides that “[i]f the court determines that the violation was grossly negligent or willful, the court may, in addition, assess, and the consumer may recover, punitive damages.” In their reply, TransUnion conceded that punitive damages are statutorily permissible, but maintains that the FAC has stated no facts as to TransUnion’s grossly negligent or willful activity.
Plaintiffs assert that they have alleged facts supporting a finding that defendants have acted with lack of care with respect to obligations under the ICRAA, sufficient to constitute gross negligence. Plaintiffs allege that “Defendants were aware of the Investigative Consumer Reporting Agencies Act (ICRAA) prior to committing the above violations and were on notice that their conduct was unlawful, and committed the above violations anyway.” (FAC ¶ 31.) Defendant further alleges that the failure to comply with ICRAA was willful in that Defendants were aware of the provisions beforehand and could have sought clarity from legal counsel if desired. (FAC ¶ 31.)
The Court finds there are
sufficient factual allegations to sustain Plaintiffs’ request for punitive
damages. TransUnion’s role in the ICRAA violation, or lack thereof, requires a
determination of fact which is not appropriately addressed by striking
Plaintiffs’ request for punitive damages.
RULING:
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.
ORDER
TransUnion Rental Screening Solutions, Inc.’s Demurrer and Motion to Strike came on regularly
for hearing on January 26, 2024, 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 DEMURRER IS OVERRULED.
THE MOTIONS TO STRIKE GENERAL AND PUNITIVE DAMAGES ARE DENIED.
THE MOTION TO STRIKE THE REQUEST FOR INJUNCTIVE RELIEF IS GRANTED.
AN AMENDED PLEADING IS DUE WITHIN 30 DAYS
UNLESS ALL PARTIES WAIVE NOTICE, TRANSUNION TO GIVE NOTICE.
IT IS SO ORDERED.
DATE: January
26, 2024 _______________________________
Yolanda Orozco, Judge
Superior
Court of California
County of Los Angeles