Judge: Frank M. Tavelman, Case: 24NNCV00197, Date: 2024-08-09 Tentative Ruling

Case Number: 24NNCV00197    Hearing Date: August 9, 2024    Dept: A

LOS ANGELES SUPERIOR COURT

NORTH CENTRAL DISTRICT - BURBANK

DEPARTMENT A

DEMURRER & MOTION TO STRIKE

MP:     Cynthia R. Sison & Nader Allahverdy (Defendants)

RP:     Larry Pobre Viglia (Plaintiff) [No Opposition Rendered]

NOTICE:

The Court is not requesting oral argument on this matter.  The Court is guided by California Rules of Court, Rule 3.1308(a)(1) whereby notice of intent to appear is requested.  Unless the Court directs argument in the Tentative Ruling, no argument is requested and any party seeking argument should notify 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 argument is received.  

Notice may be given either by email at BurDeptA@LACourt.org or by telephone at (818) 260-8412.

ALLEGATIONS:

Larry Pobre Viglia (Plaintiff) brings this action against Cynthia R. Sison & Nader Allahverdy (Defendants). Plaintiff alleges Defendants conspired to induce a loan in the amount of $20,000 and thereafter refused to repay the loan pursuant to their agreement. Plaintiff’s Complaint contains causes of action for (1) Fraud, (2) Conversion, (3) Breach of Contract, and (4) Damages Pursuant to Cal. Penal Code § 496(c).

Defendants now demur to Plaintiff’s fourth cause of action for Damages Pursuant to Cal. Penal Code § 496(c). Defendants argue that Cal. Penal Code § 496(c) does not authorize an independent civil cause of action. Defendants also move to strike Plaintiff’s claim for treble damages pursuant to Penal Code § 496(c) and his request for attorney’s fees. Plaintiff has rendered no opposition to the demurrer or motion to strike.

ANALYSIS:

I.                    LEGAL STANDARDS

Demurrer

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 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.)

Motion to Strike

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).)

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. (Tran Decl. ¶ 2.)

Fourth COA –Damages pursuant to Cal. Penal Code § 496(c) – Overruled

Defendant demurs to this cause of action on grounds that it does not permit an independent right of action. Penal Code § 496(a) provides in relevant part:

Every person who buys or receives any property that has been stolen or that has been obtained in any manner constituting theft or extortion, knowing the property to be so stolen or obtained, or who conceals, sells, withholds, or aids in concealing, selling, or withholding any property from the owner, knowing the property to be so stolen or obtained, shall be punished...

A principal in the actual theft of the property may be convicted pursuant to this section. However, no person may be convicted both pursuant to this section and of the theft of the same property.

Penal Code § 496(c) provides:

Any person who has been injured by a violation of subdivision (a) or (b) may bring an action for three times the amount of actual damages, if any, sustained by the plaintiff, costs of suit, and reasonable attorney's fees.

Defendants’ argument that Penal Code § 496(c) does not permit an independent right of action is unpersuasive. The statute explicitly states that, “Any person who has been injured by a violation of subdivision (a) or (b) may bring an action for three times the amount of actual damages…” By its plain language the statute authorizes an independent cause of action and Defendants cite to no authority interpreting the statute otherwise. Defendants’ argument that this cause of action is subsumed by Plaintiff’s causes of action for fraud and conversion is similarly unavailing for reasons that will be discussed below.

Defendants cite to the recent California Supreme Court decision in Siry Investment, L.P. v. Farkhondehpour, which they argue stands for the idea that an action cannot be maintained under Penal Code § 496(c) where a Plaintiff alleges only simple misrepresentation. The Court finds this argument is not supported by the Court’s reading of the holding in Siry. (Siry Investment, L.P. v. Farkhondehpour (2022) 13 Cal.5th 333).

The Court in Siry did explain that not all consumer fraud or misrepresentations fall within the purview Penal Code § 496. “To prove theft, a plaintiff must establish criminal intent on the part of the defendant beyond mere proof of nonperformance or actual falsity. If misrepresentations or unfulfilled promises are made innocently or inadvertently, they can no more form the basis for a prosecution for obtaining property by false pretenses than can an innocent breach of contract.” (Siry Investment, L.P. v. Farkhondehpour, supra, 13 Cal.5th at 362 [internal quotation marks and citations omitted].) This quote from Siry, presented in Defendants’ moving papers, simply does not concern the sufficiency of pleadings. The Siry court was reinforcing that a plaintiff must prove theft and intent to commit theft in order to recover under the statute, they did not opine on the circumstances under which a plaintiff’s pleadings concerning theft and intent were sufficient.

Here, Plaintiff has alleged that Defendants purposefully defrauded him of $20,000 under the guise of needing funding for a film project. (Compl. ¶ 6.) Plaintiff further alleges that Defendant Sison issued a predated check which was intended to fulfil the loan, but thereafter closed the account the check was to draw upon. (Compl. ¶¶ 8-9.) It is unmistakable that Plaintiff alleges Defendants made the fraudulent representations with the intent to deprive Plaintiff of the $20,000. 

The holding in Siry makes clear that Plaintiff will eventually have to prove Defendants’ intent in committing theft to succeed on his cause of action. This is an element which separates the cause of action under 496(c) from those of fraud and conversion such that the statutory cause of action is not duplicative. While Plaintiff may ultimately be unable to prove the intent required to recover on this cause of action, it does not follow that the cause of action is subject to demurrer.

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

Motion to Strike

Defendants move to strike Plaintiff’s claim for treble damages pursuant to Penal Code § 496(c). Defendants also move to strike Plaintiff’s request for attorney’s fees and related allegations, arguing there is no statutory basis for them.

Defendants’ motion to strike is predicated on the success of their demurrer to Plaintiff’s cause of action under Penal Code § 496(c). As the Court has overruled Defendants’ demurrer, the motion to strike is without basis. Plaintiff maintains a valid cause of action under Penal Code § 496(c) and the statute provides the basis for the recovery of attorney’s fees. Accordingly, the motion to strike is DENIED.

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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

Cynthia R. Sison & Nader Allahverdy’ s Demurrer and Motion to Strike came on regularly for hearing on August 9, 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 TO THE FOURTH CAUSE OF ACTION IS OVERRULED.

THE MOTION TO STRIKE IS DENIED IN ITS ENTIRETY.  

UNLESS ALL PARTIES WAIVE NOTICE, DEFENDANTS TO GIVE NOTICE.

IT IS SO ORDERED.

DATE:  August 9, 2024                                  _______________________________

                                                                        F.M. Tavelman, Judge

                                                                        Superior Court of California

County of Los Angeles