Judge: Kevin C. Brazile, Case: 22STCV08879, Date: 2023-04-10 Tentative Ruling

Hearing Date: April 10, 2023

Case Name: AMAG, Inc. v. Cubas, et al.

Case No.: 21STCV38459

Matter: Demurrer

Moving Party: Cross-Defendants Marc Cubas, individually and DBA Mint Supply and 

Distribution; Injected Arts, Inc.; Zambrano Law Corporation; Sydney Cubas; Cathy Cubas; Nadia Nino; Mara Cubas; Dominic Cubas; Ashley Cubas; Branding Amazing; Vanderbilt Wholesalers; and Strawberry Visual Components, joined by Omar Zambrano

Responding Party: Cross-Complainant Anastasiia Arseneva

Notice: OK

Ruling: The Demurrer is sustained as to the third through eighth causes of 

action, but is overruled as to the first and second causes of action.  Twenty days leave to amend is granted as to the fourth cause of action.  Leave to amend is denied as to the third, fifth, sixth, seventh, and eighth causes of action.

Moving parties to give notice.

If counsel do not submit on the tentative, they are strongly 

encouraged to appear by LACourtConnect rather than in person due to the COVID-19 pandemic. 

On March 6, 2023, Plaintiff AMAG, Inc. filed the operative First Amended Complaint (“FAC”) for (1) fraudulent conversion, (2) misrepresentation, (3) constructive fraud, (4) breach of fiduciary duty, and (5) declaratory relief.  Plaintiff alleges that Defendant Vlaze Media Networks, Inc. sought to avoid the judgment against it in case no. BC587406 by fraudulently transferring certain assets to the other Defendants or with the help of the other Defendants.  

On January 13, 2023, Anastasiia Arseneva, a pro per litigant, filed the First Amended Cross-Complaint (“FACC”) for (1) breach of written contract, (2) quantum meruit, (3) fraud, (4) violation of Pen. Code §§ 528.5, 529, (5) invasion of privacy/misappropriation of name, (6) quiet title, (7) breach of oral contract, and (8) declaratory relief.

Cross-Defendants Marc Cubas, Injected Arts, Inc., Zambrano Law Corporation, Sydney Cubas, Cathy Cubas, Nadia Nino, Mara Cubas, Dominic Cubas, Ashley Cubas, Branding Amazing, Vanderbilt Wholesalers, and Strawberry Visual Components, joined by Omar Zambrano, demur to all causes of action in the FACC for failure to state sufficient facts.  

When considering demurrers, courts read the allegations liberally and in context, and “treat the demurrer as admitting all material facts properly pleaded, but not contentions, deductions or conclusions of fact or law.” (Serrano v. Priest (1971) 5 Cal.3d 584, 591.)  “A demurrer tests the pleadings alone and not the evidence or other extrinsic matters. Therefore, it lies only where the defects appear on the face of the pleading or are judicially noticed. The only issue involved in a demurrer hearing is whether the complaint, as it stands, unconnected with extraneous matters, states a cause of action.”  (Hahn v. Mirda¿(2007) 147 Cal.App.4th 740, 747.)  It is error “to sustain a demurrer without leave to amend if the plaintiff shows there is a reasonable possibility any defect identified by the defendant can be cured by amendment.”  (Aubry v. Tri-City Hospital Dist.¿(1992) 2 Cal.4th 962, 967.)

1. Breach of Written Contract and Quantum Meruit

The first cause of action is for breach of a written employment contract.  The second cause of action is for quantum meruit.  The allegations are sufficient:  Cross-Complainant alleges a written contract for $150,000 per year for Cross-Complainant acting as Brand Manager/Production Executive/Marketing Manager.  Whether there actually was such a contract with all of the Cross-Defendants is a factual question.

Cross-Defendants also argue that the statute of limitations applies, but there are allegations as to a breach in 2021, which is within two/four years of the Cross-Complaint’s filing.

Cross-Defendants also argue that these claims are barred by res judicata because Cross-Complainant never sought this debt in a marital dissolution proceeding with her husband, Cross-Defendant Marc Cubas.  However, Cross-Defendants fail to explain why wages would be a component of a family law proceeding.  Additionally, the marital dissolution obviously does not pertain to any of the other Cross-Defendants.  In sum, the Demurrer is overruled as to the first and second causes of action.

2. Fraud 

Cross-Defendants argue the fraud claim is not particularly pled and that the proper elements have not been alleged.

“The elements of fraud, which give rise to the tort action for deceit, are (a) misrepresentation (false representation, concealment, or nondisclosure); (b) knowledge of falsity (or ‘scienter’); (c) intent to defraud, i.e., to induce reliance; (d) justifiable reliance; and (e) resulting damage.”  (Lazar v. Superior Court (1996) 12 Cal.4th 631, 638, internal quotation marks omitted.) 

“[F]raud must be pled specifically; general and conclusory allegations do not suffice. [Citations] Thus the policy of liberal construction of the pleadings . . . will not ordinarily be invoked to sustain a pleading defective in any material respect.  This particularity requirement necessitates pleading facts which show how, when, where, to whom, and by what means the representations were tendered.”  (Lazar v. Superior Court (1996) 12 Cal.4th 631, 645, internal quotation marks omitted.)  

The fraud claim is defective because it merely states that Cross-Defendants falsely stated to escrow companies that Cross-Complainant lent them money.  This was allegedly a part of a scheme to launder money.  The FACC fails to explain how there was any misrepresentation directed at Cross-Complainant or how Cross-Complainant relied on such a misrepresentation.  The Opposition fails to meaningfully address these issues.   Therefore, the Demurrer is sustained as to the third cause of action, without leave to amend.

3. Violation of Pen. Code §§ 528.5, 529

Cross-Defendants argue that the fourth cause of action for violation of Pen. Code §§ 528.5, 529 is defective because there is no private right of action for these statutes and no damages are pled.  

The argument as to a private right of action lacks merit.  Cross-Defendants themselves cite Pen. Code § 528.5(e), which states, “In addition to any other civil remedy available, a person who suffers damage or loss by reason of a violation of subdivision (a) may bring a civil action against the violator for compensatory damages and injunctive relief or other equitable relief pursuant to paragraphs (1), (2), (4), and (5) of subdivision (e) and subdivision (g) of Section 502.”

On the other hand, the allegations as to damages are insufficient.  There is only the allegation that “the false representations clearly expose Cross-Complainant to harm for allegedly engaging in a criminal conspiracy to launder money and engage in mail and wire fraud.”  Exposure to risk alone is not actual injury.  There is also an allegation that Cross-Complainant suffered $5,000,000 in damages, but this is merely a conclusion.  The Demurrer is sustained as to the fourth cause of action, with twenty days leave to amend.

4. Misappropriation of Name

Civ. Code § 3344(a) provides in relevant part, “Any person who knowingly uses another's name, voice, signature, photograph, or likeness, in any manner, on or in products, merchandise, or goods, or for purposes of advertising or selling, or soliciting purchases of, products, merchandise, goods or services, without such person's prior consent, or, in the case of a minor, the prior consent of his parent or legal guardian, shall be liable for any damages sustained by the person or persons injured as a result thereof. . . .”

Further, “California has long recognized a common law right of privacy (see, e.g., Melvin v. Reid (1931) 112 Cal.App. 285, 297 P. 91), which provides protection against four distinct categories of invasion (see Kapellas v. Kofman (1969) 1 Cal.3d 20, 35, fn. 16, 81 Cal.Rptr. 360, 459 P.2d 912). These four distinct torts . . . are: (1) intrusion upon the plaintiff's seclusion or solitude, or into his private affairs; (2) public disclosure of embarrassing private facts about the plaintiff; (3) publicity which places the plaintiff in a false light in the public eye; and (4) appropriation, for the defendant's advantage, of the plaintiff's name or likeness.”  (Eastwood v. Superior Court (1983) 149 Cal.App.3d 409, 416.)  At issue here is the appropriation of Cross-Complainant’s name.  “A common law cause of action for appropriation of name or likeness may be pleaded by alleging (1) the defendant's use of the plaintiff's identity; (2) the appropriation of plaintiff's name or likeness to defendant's advantage, commercially or otherwise; (3) lack of consent; and (4) resulting injury.”  (Id. at p. 417.)  

The Court does not see how Cross-Complainant’s name was used for a commercial advantage.  Typically this claim relates to using one’s name for making money on merchandise or advertisements.  It does not apparently relate to using a person’s name to allow for an escrow transaction to be completed.  In any case, as previously discussed, there is no allegation of resulting damages, other than conclusory allegations.  Therefore, the Demurrer is sustained as to the fifth cause of action, without leave to amend.

5. Quiet Title 

The quiet title claim is barred by a 4-year limitations period (see, e.g, 5 Cal. Real Est. Digest 3d Quieting Title § 5), because the subject property was purchased in June 2018, but the Cross-Complaint was filed in September 2022.

Cross-Complainant argues that she did not discover that her name was not on the grant deed for the property until January 2020.  However, Cross-Complainant fails to explain why she could not discover the issue earlier with reasonable diligence.  The limitations period accrues upon inquiry notice, which includes constructive notice based on recorded documents.  The Demurrer is sustained as to the sixth cause of action, without leave to amend.

6. Oral Contract 

The FACC fails to describe any oral contract actually at issue.  A written contract, as previously described, is alleged.  The only oral contract described is as follows: “Cross-Defendants, Vanderbilt Wholesalers, Injected Arts, Zambrano Law Corporation, through Sydney Cubas, Omar Zambrano and Marc Cubas orally promised Cross-complainant, on or April, 2020, that she would be paid all of her arrears from the written employment agreement when they were paid from their EIDL and PPP disaster loans.”  There is no consideration alleged.  Therefore, the Demurrer is sustained as to the seventh cause of action, without leave to amend. 

7. Declaratory Relief

The Demurrer is sustained as to the declaratory relief claim, without leave to amend.  This is because this claim impermissibly relates to a past controversy.  (Osseous Techs. of Am., Inc. v. DiscoveryOrtho Partners LLC (2010) 191 Cal.App.4th 357, 366) 

8. Summary 

The Demurrer is sustained as to the third through eighth causes of action, but is overruled as to the first and second causes of action.  Twenty days leave to amend is granted as to the fourth cause of action.  Leave to amend is denied as to the third, fifth, sixth, seventh, and eighth causes of action.  The Request for Judicial Notice is granted.

Moving parties to give notice.

If counsel do not submit on the tentative, they are strongly encouraged to appear by LACourtConnect rather than in person due to the COVID-19 pandemic.