Judge: Jon R. Takasugi, Case: 23STCP02715, Date: 2025-01-07 Tentative Ruling

Case Number: 23STCP02715    Hearing Date: January 7, 2025    Dept: 17

Superior Court of California

County of Los Angeles

DEPARTMENT 17

TENTATIVE RULING

            Defendant’s demurrer is OVERRULED.

On 7/28/2023, Plaintiff Nicole Rio (Plaintiff) filed suit against Myth Division, LLC and Ramon Govea (collectively, Defendants).

On 7/25/2024, Plaintiff filed a first amended complaint (FAC), alleging: (1) breach of fiduciary duty; (2) demand for accounting; (3) unfair business practices; (4) declaratory relief; and (5) fraud.

            On 8/23/2024, Defendant Ramon Govea (Defendant) demurred to the FAC’s fifth cause of action for fraud.

Discussion 

            Defendant argues that Plaintiff has not alleged sufficient facts to state a claim for fraud. More specifically, Defendant argues that Plaintiff has added new allegations not contained in her original Complaint, and that this renders the fifth cause of action defective.

            After review, the Court disagrees.

            “Under the sham pleading doctrine, plaintiffs are precluded from amending complaints to omit harmful allegations, without explanation, from previous complaints to avoid attacks raised in demurrers or motions for summary judgment.” (Deveny v. Entropin, Inc. (2006) 139 Cal.App.4th 408, 425.)  Moreover, any inconsistencies with prior pleadings must be explained; if the pleader fails to do so, the court may disregard the inconsistent allegations. [Citation.] Accordingly, a court is ‘not bound to accept as true allegations contrary to factual allegations in former pleading in the same case.’ [Citation.]” (Larson v. UHS of Rancho Springs, Inc. (2014) 230 Cal.App.4th 336, 343; quoting Vallejo Development Co. v. Beck Development Co. (1994) 24 Cal.App.4th 929, 946.)  

            Here, Plaintiff’s FAC alleges that in or around May 2021, in order to induce Plaintiff to work exclusively for Myth Division, LLC, Govea represented to Plaintiff that he would pay Plaintiff $10,000.00 per month for her work, give her an ownership stake in the LLC, and accurately account for royalties. (FAC ¶ 54.) Plaintiff further alleges that Govea told Plaintiff she should transfer her film projects to Myth Division, LLC and he would use his resources and experience to market her films and media projects. Plaintiff also alleges that Govea made false statements to Plaintiff that Govea, through Myth Division, would produce, promote, market and release Plaintiff’s films when, in fact, Govea had no intention of doing so. (Id. at ¶ 55)

            While these allegations were not included in the original Complaint, these allegations are not inconsistent with, or in contradiction to, any previous allegations. As such, the Court finds an insufficent basis for applying the sham pleading doctrine.

            “Fraud must be pleaded with specificity rather than with “general and conclusory allegations.” (Small v. Fritz Companies, Inc. (2003) 30 Cal.4th 167, 184.) The specificity requirement means a plaintiff must allege facts showing how, when, where, to whom, and by what means the representations were made, and, in the case of a corporate defendant, the plaintiff must allege the names of the persons who made the representations, their authority to speak on behalf of the corporation, to whom they spoke, what they said or wrote, and when the representation was made. (Lazar v. Superior Court (1996) 12 Cal.4th 631, 645.)” (West v. JPMorgan Chase Bank, N.A. (2013) 214 Cal.App.4th 780, 793.)

            Here, Plaintiff’s allegations set forth the “how, when, where, to whom, and by what means the representations were made” and thus are sufficient at the pleadings stage to state a claim.

            Based on the foregoing, Defendant’s demurrer is overruled.

It is so ordered.

Dated:  January    , 2025

   Hon. Jon R. Takasugi
   Judge of the Superior Court

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