Judge: Kevin C. Brazile, Case: 22STCV23080, Date: 2023-05-03 Tentative Ruling

Hearing Date: May 3, 2023

Case Name: Simmons Unlimited, LLC v. Izydorczyk, et al.

Case No.: 21STCV43407 

Matter: Demurrer; Motion to Strike

Moving Party: Cross-Defendants Simmons Unlimited, LLC and Imani Simmons

Responding Party: Cross-Complainant Dejanee Riley Izydorczyk

Notice: OK

Ruling: The Demurrer is overruled.

The Motion to Strike is denied.

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. 

1. Background

On November 24, 2021, Plaintiff Simmons Unlimited, LLC filed the operative Complaint against Defendants Dejanee Riley Izydorczyk (“Riley”), Gabriella McNeill, and Deja Riley Athletics, LLC (“DRA”) for (1) breach of contract, (2) breach of the implied covenant of good faith and fair dealing, (3) fraud—intentional misrepresentation, (4) fraud—negligent misrepresentation, (5) intentional interference with contract, (6) intentional interference with prospective economic advantage, (7) negligent interference with prospective economic advantage, (8) unjust enrichment, (9) accounting, (10) constructive trust, and (11) declaratory relief.  

The allegations of the Complaint are as follows.  Plaintiff is a brand manager who entered into an agreement to provide services for Defendant Riley, who is a fitness celebrity.  Plaintiff was able to bring together a long-term, six-figure brand partnership with Lululemon/Mirror.  Immediately before this deal closed, Defendant Riley wrongfully terminated the subject management agreement with Plaintiff and declined to pay any commissions resulting from the Lululemon/Mirror deal.  Defendant Gabriella McNeill is a friend of Riley and worked as her “managing director”, although she had virtually no experience in the industry.  McNeill excluded Plaintiff from various communications with Lululemon/Mirror and ultimately sought to terminate Plaintiff’s relationship with Riley.  DRA is Riley’s loan-out company and alter ego.  DRA was ultimately used to circumvent payment of commissions to Plaintiff. 

On February 24, 2023, Riley filed a Third Amended Cross-Complaint (“TACC”) for (1) intentional misrepresentation and (2) negligent misrepresentation.  Riley alleges that Cross-Defendants Simmons Unlimited, LLC and Imani Simmons made the following misrepresentations, which caused Riley to enter into a management agreement with Cross-Defendants: 

a. On August 11, 2020, at an initial meeting between Cross-Complainant and CrossDefendants, which began on a hike at Griffith Park in Los Angeles, California, continued at Toast Bakery Café in Los Angeles, California, and ended at a hotel in Los Angeles, California, Imani Simmons repeatedly represented to Cross-Complainant verbally that Cross-Defendants had personally worked with and personally managed multiple “big name” brands and talent including, but not limited to, Jagermeister, Puma, and Lady Footlocker, and “big name” musical artists and further represented to Cross-Complainant verbally that Cross-Defendants had personally secured large deals for them; 

b. On August 11, 2020 and in early September 2020, at Toast Bakery Café in Los Angeles, California and at Chao Krung Thai restaurant in Los Angeles, California, where meetings took place between Cross-Defendants and Riley, Imani Simmons also represented to Cross-Complainant verbally that Cross-Defendants personally had connections to secure large deals for Cross-Complainant and were working on a deal with Jagermeister for Cross-Complainant amidst other deals, such as with Puma and Lady Footlocker, for Cross-Complainant; 

c. On August 11, 2020, at the initial meeting between Cross-Complainant and CrossDefendants, which began on a hike at Griffith Park in Los Angeles, California, continued at Toast Bakery Cafe in Los Angeles, California, and ended at a hotel in Los Angeles, California, Imani Simmons further represented to Cross-Complainant that Ms. Simmons and Simmons Unlimited was an established and experienced brand manager with “several clients.”

2. Demurrer 

Cross-Defendants Simmons Unlimited, LLC and Imani Simmons demur to the TACC for failure to state sufficient facts.  They argue, “CrossComplainant again unequivocally fails to allege each element with the required degree of particularity. Second, the alleged conduct amounts to nothing more than mere puffery and is not actionable fraud. Third, Riley’s allegations substantially pertain to opinions about ‘future’ events that are not actionable fraud.” 

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.)

“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.)  

“Negligent misrepresentation is a form of deceit, the elements of which consist of (1) a misrepresentation of a past or existing material fact, (2) without reasonable grounds for believing it to be true, (3) with intent to induce another's reliance on the fact misrepresented, (4) ignorance of the truth and justifiable reliance thereon by the party to whom the misrepresentation was directed, and (5) damages.”  (Fox v. Pollack (1986) 181 Cal. App. 3d 954, 962.)

A negligent misrepresentation claim should also be pled with specificity.  (Charnay v. Cobert (2006) 145 Cal.App.4th 170, 185, fn. 14.) 

For the previous demurrers, the Court stated, “there is no specific allegation of what damages were suffered.  Further, for the alleged misrepresentation that Cross-Defendants had secured large deals with large brands, there is no allegation of where or how this misrepresentation was tendered.  Further, it is not apparent that a misrepresentation claim can be based on an assertion that one is ‘established and experienced’ as this seems to be an opinion or puffery.  (See Cal. Prac. Guide Civ. Pro. Trial Claims and Def. Ch. 14(I)-B [‘Generalized, vague assertions of superiority that do not make specific claims about a product or service may be regarded as ‘mere puffery’ upon which a reasonable consumer could not rely, and hence are not actionable as ‘fraudulent’ business practices or false advertising.’].)”

The TACC now contains sufficient factual specificity as described above.  Further, the subject claims are appropriately premised on representations that Cross-Defendants had worked with brands like Jagermeister and Puma and that Cross-Defendants had several clients.  The TACC states that none of this was true.    

The Court’s biggest concern was the allegations as to damages.  The TACC now states there were “financial losses from any and all monies spent and/or costs incurred as a result of Cross-Complainant’s reliance on CrossDefendants’ representations (e.g. all costs incurred in the attempted production of the above referenced YouTube video, which resulted in an unusable final product, and monies paid to Cross-Defendants); loss of business opportunities and deals (e.g. including but not limited to Puma and Lady Footlocker); loss of opportunity to pursue other management; damages to reputation; any and all other out-of-pocket and/or benefit-of-the-bargain damages; attorney’s fees and costs incurred in connection with this action or proceeding; and mental and emotional distress and discomfort . . . .”

Most of the above is still insufficient, but the TACC is adequate to the extent based on the costs of production of an unusable Youtube video.  Riley alleges that despite Cross-Defendants stating they had several clients, they could not acquire sufficient talent for her video.  

Thus, the Demurrer is overruled.  An answer is to be filed within twenty days.  The Request for Judicial Notice is granted.

3. Motion to Strike

Cross-Defendants seek to strike the TACC’s references to attorneys’ fees and punitive damages.

The Motion is denied as to punitive damages because fraud is pled.  (Civ. Code § 3294.)

The Motion is denied as to attorneys’ fees because these fees seem to be premised on the management agreement between the parties.

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.