Judge: Gail Killefer, Case: 23STCV26231, Date: 2025-02-11 Tentative Ruling



Case Number: 23STCV26231    Hearing Date: February 11, 2025    Dept: 37

HEARING DATE:                 Tuesday, February 11, 2025

CASE NUMBER:                   23STCV26231

CASE NAME:                        People of the State of California, ex rel. Allstate Insurance Company v. Pacific MRI, A Nursing Corporation, et al.

MOVING PARTY:                 Plaintiff People of the State of California, ex rel. Allstate Insurance Company

OPPOSING PARTY:             Defendant Amjad Safvi, M.D.

TRIAL DATE:                        Not set.

PROOF OF SERVICE:           OK

                                                                                                                                                           

PROCEEDING:                      Demurrer to Answer

OPPOSITION:                        29 January 2025

REPLY:                                  04 February 2025

 

TENTATIVE:                         Plaintiff’s demurrer to Defendant Safvi’s First Amended Answer is sustained with leave to amend. Defendant Safvi is granted 10 days leave to amend. The court sets the OSC RE: Amended Answer for February 28, 2025, at 8:30 a.m.

                                                                                                                                                           

 

Background

 

On October 25, 2023, People of the State of California, ex rel. Allstate Insurance Company (“Plaintiff”) filed a Complaint for violations of the Insurance Frauds Prevention Act (“IFPA”) against Pacific MRI, A Nursing Corporation (“Pacific MRI”); Sarabjit Singh Anand, R.N., N.P. (“Anand”); GA Management and Consulting LLC (“GA Management”); Mustafa Asghari (“Asghari”); Mars Healthcare Inc. (“Mars”); Nicholas Dzebolo, M.D. (“Dzebolo”); Amjad Safvi, M.D. (“Safvi”); and Does 1 to 200 inclusive.

 

Defendant Safvi filed a First Amended Answer (“FAA”) on November 27, 2024. Plaintiff now demurs to the FAA. Defendant Safvi opposes the demurrer. The matter is now before the court.

 

Demurrer[1]

 

I.         Legal Standard

 

A verified complaint must be denied positively or according to information and belief. A general denial is effective to controvert all material allegations of an unverified complaint.  (CCP, § 431.30(d).)  Anything less than a general denial of the whole complaint is a “qualified” or “specific” denial.  A defendant can direct his or her denials to specific sentences, paragraphs, of parts of the complaint.  Although not widely used, a defendant can also effectively deny allegations in the complaint by alleging contrary or inconsistent facts. 

 

The same pleading of “ultimate facts” rather than evidentiary matter or legal conclusions is required as in pleading a complaint.  The answer must aver facts as carefully and with as much detail as the facts which constitute the cause of action and which are alleged in the complaint.  (FPI Development, Inc. v. Nakashimi (1991) 231 Cal.App.3d 367, 384.)  The various affirmative defenses must be separately stated and must refer to the causes of action to which they relate “in a manner by which they may be intelligently distinguished.”  (CCP, § 431.30(g).)  Defenses must be pleaded in the nature of “yes, the allegations [of the complaint] are true, but . . .”  (FPI Development, Inc., at p. 383.) 

 

The allegations of the pleading demurred to must be regarded as true.  (South Shore Land Co. v. Petersen (1964) 226 Cal.App.2d 725, 730.)  All that is necessary against a demurrer is that, upon consideration of all of the facts stated, it appears that the party whose pleading is attacked by such a demurrer is entitled to any relief at the hands of the court against his adversary.  (Id. at p. 733.)  When considering a demurrer to answer, the “determination of the sufficiency of the answer requires an examination of the complaint because its adequacy is with reference to the complaint it purports to answer.”  (Ibid.)  “[T]he demurrer to the answer admits all issuable facts pleaded therein and eliminates all allegations of the complaint denied by the answer.”  (Ibid.) 

 

II.        Discussion

 

Plaintiff demurs to Defendant Safvi’s 7th, 8th, 9th, and 10ths affirmative defenses for waiver, unclean hands, laches, and estoppel on the basis that they contain no supporting factual allegation of fact sufficient to put Plaintiff on notice as to the nature of the defenses. In addition to denials, the answer should contain all affirmative defenses or objections to the complaint that defendant may have, and that would otherwise not be in issue under a simple denial.  Such defenses or objections are “new matter.”  (CCP § 431.30(b).) “Such ‘new matter” is also known as ‘an affirmative defense.’ ” (Quantification Settlement Agreement Cases (2011) 201 Cal.App.4th 758, 812 (Quantification Settlement Agreement Cases).) In other words, defense or objection based on “new matter” “must be specifically pleaded.” (Advantec Group, Inc. v. Edwin's Plumbing Co., Inc. (2007) 153 Cal.App.4th 621, 628.)

 

 “The phrase ‘new matter’ refers to something relied on by a defendant which is not put in issue by the plaintiff.”  (Walsh v. West Valley Mission Community College District (1998) 66 Cal.App.4th 1532, 1546.)  Where the answer sets forth facts showing some essential allegation of the complaint is not true, such facts are not new matters but are denials.  (Ibid.) “However, [n]o error or defect in a pleading is to be regarded unless it affects substantial rights …. The primary function of a pleading is to give the other party notice so that it may prepare its case …, and a defect in a pleading that otherwise properly notifies a party cannot be said to affect substantial rights. (Harris v. City of Santa Monica (2013) 56 Cal.4th 203, 240 [internal citations and quotation marks omitted].) 

 

Defendant Safvi’s 7th affirmative defense for waiver alleges that Plaintiff’s own actions, omission or conduct, resulted in waiver without elaborating what specific conduct Plaintiff engaged in support defense of waiver. The 8th affirmative defense for unclean hands similarly fails to allege what actions Plaintiff took or failed to take that contributed Plaintiff’s harm, including what specific business practices Defendant Safvi believes results in unclean hands. The 9th affirmative defense fails to allege facts to support the allegation that Plaintiff had actual or constructive knowledge of the facts giving rise to this action. Lastly, the 10th affirmative Defense alleges that “Defendant to reasonably believe that Plaintiff had approved the transactions in question” but fails to state what specific conduct led Defendant to believe Plaintiff approved the transactions.

 

Without specific factual allegations to support Defendant Safvi’s affirmative defenses, Safvi defenses consist solely of legal conclusions. (See Bagatti v. Department of Rehabilitation (2002) 97 Cal.App.4th 344, 366, fn. 8 [“These conclusionary allegations, which allege no specific acts, are insufficient to survive demurrer.”].)

 

“The particularity required in pleading facts depends on the extent to which the defendant in fairness needs detailed information that can be conveniently provided by the plaintiff.” (Ludgate Ins. Co. v. Lockheed Martin Corp. (2000) 82 Cal.App.4th 592, 608.) The court is aware that affirmative defenses are waived if not raised in the Answer. (See California Academy of Sciences v. County of Fresno (1987) 192 Cal.App.3d 1436, 1442 [“A party who fails to plead affirmative defenses waives them.”].) If Defendant Safvi insists that the specific standard for affirmative defenses be relaxed because certain facts relevant to Defendant’s affirmative defenses are known only to the Plaintiff and can be uncovered through discovery, those allegations may be pled on information and belief provided that Defendant could provide the information that lead the Defendant to believe the allegations are true.  (See Brown v. USA Taekwondo (2019) 40 Cal.App.5th 1077, 1106; Doe v. City of Los Angeles (2007) 42 Cal.4th 531, 551, fn. 5.)

 

“As we have noted, affirmative defenses cannot be pled as mere legal conclusions but must instead be alleged with as much factual detail as the allegations of a complaint.” (Quantification Settlement Agreement Cases, supra, 201 Cal.App.4th at p. 813.) As Defendant Safvi’s fails to plead factual allegation to support Defendant’s affirmative defenses the demurrer to answer is sustained with leave to amend.

 

Conclusion

 

Plaintiff’s demurrer to Defendant Safvi’s First Amended Answer is sustained with leave to amend. Defendant Safvi is granted 10 days leave to amend. The court sets the OSC RE: Amended Answer for February 28, 2025, at 8:30 a.m.



[1] Pursuant to CCP § 430.41, the meet and confer requirement has been met. (Reichmuth Decl., ¶ 2.)