Judge: Kevin C. Brazile, Case: 23STCV15519, Date: 2024-11-22 Tentative Ruling

Hearing Date: November 22, 2024

Case Name: Pfau v. Riko Wiemer International, LLC, et al.

Case No.: 21STCV27719

Matter: Demurrer

Moving Party: Jeremy Pfau

Responding Party: Riko Weimer and Riko Weimer International, LLC

Notice: OK

Ruling: The Demurrer is sustained, without leave to amend.

Moving party to give notice.

On July 28, 2021, Plaintiff Jeremy Pfau filed the operative Complaint against Defendants Riko Wiemer International, LLC and Riko Wiemer (actually spelled “Weimer”) for (1) violation of Labor Code §§ 1182.12, 1194, 1197, 1197.1, and 1198 (Unpaid Wages); (2) violation of Labor Code §§ 226.7 and 1198 (Failure to Authorize and Permit Rest Periods); (3) violation of Labor Code § 2802 (Unreimbursed Business Expenses); (4) violation of Labor Code §§ 201-202 (Wages Not Timely Paid Upon Termination); (5) violation of Business & Professions Code §§ 17200, et seq., (6) retaliation in violation of Labor Code § 1102.5; and (7) wrongful termination.  Plaintiff alleges he was a piano instructor for Defendants and that he was not paid for all hours worked, not paid for business expenses, and not given rest breaks.  Plaintiff alleges he was terminated for complaining about these issues.

On July 29, 2024, Riko Weimer International, LLC and Riko Weimer filed a Second Amended Cross-Complaint (“SACC”) against Jeremy; this pleading also identified Does 1 and 2 as Jeremy’s parents, Bruce and Amy Pfau.  

Riko contends that Jeremy’s parents were part of some sort of conspiracy in which they aided Jeremy with his wage and hour complaints and settlement, “concealed” that Jeremy had depression, and objected to a subpoena for phone records.  The SACC goes as far as saying that the Pfaus were “acting in a conspiracy with one another to accomplish the unlawful purpose of extracting money from Cross Complainants via poorly researched and understood claims in this lawsuit, and/or intentional misuse of litigation processes to pay Pfau family medical and business expenses attributable to Jeremy’s chronic mental health condition and to support Jeremy’s business in competition with RWI.”

On November 7, 2024, the Court granted motions to quash service of summons for lack of personal jurisdiction; Bruce and Amy were dismissed.  

Jeremy now demurs to the SACC 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.)

“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 first cause of action for fraud alleges that Jeremy is liable for not disclosing that he had preexisting depression.  As an initial matter, there is no duty to disclose a preexisting medical condition to an employer.  If any injury arose from the normal course of the employment relationship, Riko can prove her defense relating to the workers’ compensation exclusivity rule.  She, however, has not pleaded any affirmative claim for fraud.  Aside from there being no duty to disclose a preexisting condition, Riko failed to sufficiently and specifically plead causation, reliance, and damages.  The other supposed acts of concealment are deficient and/or uncertain, and cannot support any claim.  The Demurrer is sustained as to the fraud claim, without leave to amend.

Next, “to establish a cause of action for abuse of process, a plaintiff must plead two essential elements: that the defendant (1) entertained an ulterior motive in using the process and (2) committed a wilful act in a wrongful manner.”  (State Farm Mut. Auto. Ins. Co. v. Lee (2011) 193 Cal.App.4th 34, 40.)

The abuse of process claim is defective.  This claim is premised on the filing of “poorly researched and understood claims in this lawsuit”.  However, “the mere filing or maintenance of a lawsuit—even for an improper purpose—is not a proper basis for an abuse of process action.”  (Oren Royal Oaks Venture v. Greenberg, Bernhard, Weiss & Karma, Inc. (1986) 42 Cal.3d 1157, 1169.)   Thus, the Demurrer is sustained as to the second cause of action, without leave to amend.

Next, “The elements of a cause of action for breach of a duty of loyalty, by analogy to a claim for breach of fiduciary duty, are as follows: (1) the existence of a relationship giving rise to a duty of loyalty; (2) one or more breaches of that duty; and (3) damage proximately caused by that breach.”  (Huong Que, Inc. v. Luu (2007) 150 Cal.App.4th 400, 410.)

“[A]n employer has the right to expect the undivided loyalty of its employees. The duty of loyalty is breached, and may give rise to a cause of action in the employer, when the employee takes action which is inimical to the best interests of the employer.”  (Stokes v. Dole Nut Co. (1995) 41 Cal.App.4th 285, 295.)

This claim is primarily premised on Jeremy establishing a competing business, but this is barred by Bus. & Prof. Code § 16600.  Notably, Jeremy is permitted to make preparations before termination.

Finally, the UCL claim fails because it is derivative of the other unsuccessful claims.  Furthermore, Riko failed to plead a right to restitution or an injunction.  

In sum, the Demurrer is sustained, without leave to amend.  The RJN is granted.

Moving party to give notice.