Judge: Kevin C. Brazile, Case: BC716244, Date: 2022-09-21 Tentative Ruling

Hearing Date: September 21, 2022

Case Name: Su, et al. v. Calcrete Construction, Inc., et al.

Case No.: BC667644

Matter: Demurrer

Moving Party: Defendant Vachik Danoukh

Responding Party: Plaintiff Labor Commissioner

Notice: OK

Ruling: The Demurrer is sustained in part, with five days leave to amend.

Moving party 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 September 20, 2019, the Labor Commissioner filed the operative Second Amended Complaint (“SAC”) against Calcrete Construction, Inc., Calcrete Inc., and Does 2-10 for (1) failure to pay overtime wages, (2) penalties for failure to pay overtime wages, (3) waiting time penalties, (4) failure to pay sick leave, (5) failure to provide accurate wage statements, and (6) willful misclassification.  Calcrete Construction, Inc. and Calcrete Inc. are alleged to be alter egos.

On April 25, 2022, Plaintiff identified Doe 2 as Vachik Danoukh.

The trial date is set for September 26, 2022.  This seems to be a “5-year” case. 

Vachik Danoukh demurs to the SAC for failure to state sufficient facts.  Specifically, Danoukh argues that he is not properly pled as an alter ego of the other Defendants and that this action is time-barred as to him because his existence was known in 2017. 

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.)

As to liability for Doe 2, the SAC states, “Defendants DOES 2 through 10 were in some manner responsible for the acts and injuries complained of herein, and were at all times mentioned herein employees, agents, partners, and/or representatives of Defendants  CALCRETE and CALCRETE INC., and were at all times acting within the course and scope of such agency, service, employment, partnership and/or joint venture.”  The SAC asserts all causes of action against Doe 2.

Based on these allegations, Danoukh could be liable for the second cause of action as a person acting on behalf of the employer.  (Lab. Code § 558.)

On the other hand, it is not apparent how Danoukh can be liable for the other Labor Code violations as an agent, employee, partner, or representative of the remaining Defendants.  Further, the SAC does not plead any facts to indicate that Danoukh was operating in a joint venture.

In its Opposition, Plaintiff contends Danoukh is an alter ego of the other Defendants.  However, this is not actually alleged in the SAC.

As the basis for liability for Danoukh is currently unclear, the Demurrer is sustained as to the first, third, fourth, fifth, and sixth causes of action, with five days leave to amend.

As to the second cause of action, as mentioned, Defendant argues that the statute of limitations applies.

A plaintiff may file an action against a doe defendant when she is “ignorant of the name of a defendant.”  (Code Civ. Proc. § 474.)  The phrase, “ignorant of the name of a defendant” means either (1) plaintiff was unaware of defendant's identity, (2) plaintiff was unaware of defendant's culpability (facts giving rise to a cause of action against the defendant), or (3) the law did not give plaintiff a right of action until after commencement of the action.  (See Marasco v. Wadsworth (1978) 21 Cal.3d 82, 88.)  “[Code Civ. Proc.] [s]ection 474 allows a plaintiff in good faith to delay suing particular persons as named defendants until he has knowledge of sufficient facts to cause a reasonable person to believe liability is probable. The distinction between a suspicion that some cause could exist and a factual basis to believe a cause exists is critical in the operation of section 474. The former is one reason attorneys include general charging allegations against fictitiously named defendants; the latter requires substitution of the defendant's true name.”  (Dieckmann v. Superior Court (1985) 175 Cal.App.3d 345, 363.)

Code Civ. Proc. § 474 “includes an implicit requirement that a plaintiff may not ‘unreasonably delay’ his or her filing of a Doe amendment after learning a defendant's identity.”  (A.N. v. Cty. of Los Angeles (2009) 171 Cal.App.4th 1058, 1066–67.)

“When a defendant is properly named under section 474, the amendment relates back to the filing date of the original complaint.”  (McClatchy v. Coblentz, Patch, Duffy & Bass, LLP (2016) 247 Cal.App.4th 368, 371.)  

Here, it is a factual matter whether Plaintiff was aware of Defendant’s culpability at the time the SAC was filed or whether Plaintiff unreasonably delayed filing a doe amendment.

Regardless, if Plaintiff were to plead an alter ego theory for Danoukh, the statute of limitations would be irrelevant.  Indeed, “[i]t is established that an action may be brought against an alter ego defendant after the statute of limitations applicable to the cause of action alleged in the original complaint has expired.”  (Hennessey's Tavern, Inc. v. Am. Air Filter Co. (Ct. App. 1988) 204 Cal.App.3d 1351, 1359.)

In sum, the Demurrer is sustained as to the first, third, fourth, fifth, and sixth causes of action, with five days leave to amend.  The Demurrer is overruled as to the second cause of action.

The Court discourages any further demurrers as all that is required is the ultimate facts or basic elements of alter ego liability.  (Rutherford Holding, LLC v. Plaza Del Rey (2014) 223 Cal.App.4th 221, 236.)

Moving party 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.