Judge: Laura A. Seigle, Case: 22STCV18841, Date: 2023-02-14 Tentative Ruling

Case Number: 22STCV18841    Hearing Date: February 14, 2023    Dept: 15

[TENTATIVE] ORDERS RE MOTIONS FOR SUMMARY JUDGMENT, SUMMARY ADJUDICATION, AND TO BIFURCATE OR SEVER

            Defendant Central Garden & Pet Company, Farnam Companies, Inc. filed a motion for summary judgment and a motion to bifurcate or sever, and Defendant Whittaker, Clark & Daniels filed a motion for summary adjudication.

A defendant seeking summary judgment must “conclusively negate[] a necessary element of the plaintiff’s case, or . . . demonstrate[] that under no hypothesis is there a material issue of fact that requires the process of trial.”  (Guz v. Bechtel Nat. Inc. (2000) 24 Cal.4th 317, 334.)  To show that a plaintiff cannot establish an element of a cause of action, a defendant must make the initial showing “that the plaintiff does not possess, and cannot reasonably obtain, needed evidence.”  (Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826, 854.)  “The defendant may, but need not, present evidence that conclusively negates an element of the plaintiff’s cause of action.  The defendant may also present evidence that the plaintiff does not possess, and cannot reasonably obtain, needed evidence – as through admissions by the plaintiff following extensive discovery to the effect that he has discovered nothing.”  (Id. at p. 855.)  A plaintiff’s deposition testimony that the plaintiff has no knowledge of any exposure to the defendant’s products may be sufficient to shift the burden to the plaintiff to demonstrate the existence of triable issues of fact.  (McGonnell v. Kaiser Gypsum Co., Inc. (2002) 98 Cal.App.4th 1098, 1103-1104.)  The plaintiff’s deposition testimony that he did not recall ever working with a product manufactured by the defendant may not be sufficient to shift the burden if the plaintiff is able to prove his case by another means.  (Weber v. John Crane, Inc. (2006) 143 Cal.App.4th 1433, 1439.)  “ ‘If plaintiffs respond to comprehensive interrogatories seeking all known facts with boilerplate answers that restate their allegations, or simply provide laundry lists of people and/or documents, the burden of production will almost certainly be shifted to them once defendants move for summary judgment and properly present plaintiff’s factually devoid discovery responses.’”  (Id. at p. 1440.)

I.          Central Garden and Farnam’s Motion for Summary Judgment

            A.        Objections

            Plaintiffs’ Objection Nos. 1-3, 5-9:  Overruled

            Plaintiffs’ Objection No. 2 :  Sustained.  Pursuant to Evidence Code section 1523, oral testimony is not admissible to prove the content of a writing except in certain situations that Defendants have not shown apply here.  However, even if the court overruled the objection, the decision below would not be impacted.

B.        Summary Judgment

Defendant Central Garden & Pet Company and Farnam Companies, Inc. argue Plaintiffs cannot prove Defendants are liable because Marni Regan used the Adams brand flea and tick powder in the 1990s to 2003, before Defendants owned the company.  (Motion at p. 1.)  Defendant cites to the declaration of Barry Harrison, who states Farnam entered into an asset purchase agreement to buy the Adams Brand in 2002.  (Harrison Decl., ¶ 5.)  The agreement transferred rights to the Adams brand in December 2004.  (Ibid.)  Farnam acquired ownership of the Adams brand on December 18, 2004.  (Id. at ¶ 7.) 

            “The rule ordinarily applied to the determination of whether a corporation purchasing the principal assets of another corporation assumes the other’s liabilities” is that “the purchaser does not assume the seller’s liabilities.”  (Ray v. Alad Corp. (1977) 19 Cal.3d 22, 28.  However, there are several exceptions to that rule including where there is an express or implied agreement of assumption.  (Ibid.)  The Harrison declaration did not attach a copy of the asset purchase agreement or state whether the agreement contained an assumption of the prior owner’s liabilities.  Nor did Defendants address the other exceptions to the general rule set forth in Ray.  Therefore, even assuming that Marni Regan never used Adams brand products after December 18, 2004, Defendants did not show that they did not assume any pre-December 18, 2004 liabilities or that the other exceptions do not apply.

            The motion for summary judgment is denied.

C.        Summary Adjudication

            Defendants move for summary adjudication of the negligence and strict liability causes of action on the ground that they did not own the Adams brand products at the time Marni Regan used the products and therefore they are not liable.  (Motion a p. 8.)  For the reasons discussed above, this motion fails.

            Defendants move for summary adjudication of the fraud cause of action on the ground that Plaintiffs have no evidence that Defendants’ manufactured the product at issue.  (Motion at p. 9.)  This argument is unclear.  If Defendants are arguing that Plaintiffs’ discovery responses are factually devoid and Plaintiffs cannot obtain evidence, the argument fails because Defendants did not cite to Plaintiffs’ discovery responses or show they are factually devoid.  If the argument is that Defendants did not own the Adams Brand products at the time of exposure, it fails for the reasons discussed above.

            Defendants next move for summary adjudication of the request for punitive damages because “Plaintiffs lack evidence establishing that Ms. Regan was exposed to an asbestos-containing product made by Defendants, but they also fail to present any evidence that Defendants acted with malice, oppression or fraud.”  (Motion at p. 9.)  In their moving papers, Defendants cite no evidence in support of this argument.  A defendant must show with evidence, and not merely assert, that a plaintiff does not possess and cannot reasonably obtain needed evidence.  (Aguilar, supra, 25 Cal.4th at p. 854.)  As explained above, Defendants failed to show they did not assume any liability for pre-acquisition claims.  Also, in their separate statement Defendants do not show that they served an interrogatory asking Plaintiffs to state for all facts supporting their request for punitive damages and that Plaintiffs gave a factually-devoid response.  Because Defendants did not satisfy their initial burden, the motion is denied.

            For the same reasons, Defendants’ motion for summary adjudication of the cause of action for loss of consortium is denied.

            The motion for summary judgment and adjudication is DENIED.

II.        Whittaker, Clark & Daniels, Inc.’ Motion for Summary Adjudication

            Defendant Whittaker, Clark & Daniels, Inc. seeks summary adjudication of the third cause of action for fraud and the request for punitive damages.  The third cause of action actually alleges several causes of action – fraudulent misrepresentation, fraudulent concealment, claims under Civil Code sections 1708, 1709 and 1710, and conspiracy to commit fraud.  The complaint is defectively vague and fails to identify with any specificity what false statement Defendant alleged made to Plaintiffs.  It is also extremely vague about the information Defendant alleged concealed from Plaintiffs and how Defendant conspired to commit fraud.

A.                Objections

Defendant’s Objections to Longo Declaration:  The court did not rely on this evidence.

Defendant’s Objections Nos. 1, 2, 3:  Overruled.

Defendant’s Objections Nos. 4-31:  The court did not rely on this evidence.

            B.        Fraudulent Misrepresentation

            To prove a cause of action for a false representation, a plaintiff must prove the defendant represented to plaintiff that a fact was true, the defendant’s representation was false, the defendant knew the representations was false when the defendant made it, the defendant intended the plaintiff to rely on the representation, the plaintiff reasonably relied on the representation, the plaintiff was harmed, and the reliance was a substantial factor in causing the harm.  (CACI 1900.)  Defendant argues Plaintiffs have no evidence it made any false representation to Plaintiffs.  Defendant cites to Marni Regan’s deposition where Plaintiffs stipulated Marni Regan has no knowledge that Defendant made misrepresentations to her.  (Arnett Decl., Ex. C at pp. 104-105, 397-398.)  This, along with the defectively vague complaint, is sufficient to shift the burden. 

In opposition, Plaintiffs argue that Defendant did not shift the burden because Defendant did not cite to Plaintiffs’ responses to special interrogatories.  In special interrogatory No. 3, Defendant asked Plaintiffs to state all facts supporting the third cause of action for fraud.  (Rahmes Decl., Ex. 3 at p. 14.)  Plaintiffs responded by incorporating their response to interrogatory No. 1 and by referring to Marni Regan’s deposition testimony.  (Ibid.)  As already discussed, in her deposition, Plaintiff stipulated she knew nothing about Defendant.  In response to interrogatory No. 1, Plaintiffs did not identify any evidence that Defendant made any statement to Plaintiffs or had any direct relationship with Plaintiffs.  Thus, these discovery responses are factually devoid and sufficient to shift the burden to Plaintiffs.

Plaintiffs do not contend that Defendant made any affirmative misrepresentation to Marni Regan.  The complaint alleges that every defendant made false representations to “a third party intending and reasonably expecting that the substance of those representations would be repeated to Plaintiff,” but Plaintiffs provide no evidence that Defendant made a false representation to a specific third party intending that it be repeated to Marni Regan.  Plaintiffs failed to the existence of a disputed fact regarding affirmative misrepresentations to Marni Regan.

Therefore, summary adjudication is granted as to the cause of action for fraudulent misrepresentation.

C.        Fraudulent Concealment

“ ‘[T]he elements of a cause of action for fraud based on concealment are “ ‘(1) the defendant must have concealed or suppressed a material fact, (2) the defendant must have been under a duty to disclose the fact to the plaintiff, (3) the defendant must have intentionally concealed or suppressed the fact with the intent to defraud the plaintiff, (4) the plaintiff must have been unaware of the fact and would not have acted as he did if he had known of the concealed or suppressed fact, and (5) as a result of the concealment or suppression of the fact, the plaintiff must have sustained damage.’ ”  [Citation.]’ ”  (Bigler-Engler v. Breg, Inc. (2017) 7 Cal.App.5th 276, 310-311.)  When a fiduciary duty does not exist, a duty to disclose arises only “when the defendant had exclusive knowledge of material facts not known to the plaintiff,” or “when the defendant actively conceals a material fact from the plaintiff,” or “when the defendant makes partial representations but also suppresses some material facts.”  (Id. at p. 311.)  This type of relationship “ ‘can only come into being as a result of some sort of transaction between the parties’ ” and “must necessarily arise from direct dealings between the plaintiff and the defendant; it cannot arise between the defendant and the public at large.”  (Ibid.)   

In the fraudulent concealment cause of action, the complaint alleges with no specificity each defendant “made affirmative statements that were so misleading.”  (Complaint, ¶ 32(a).)   The complaint also alleges every defendant “entered into a relationship and/or transaction with Marni Regan sufficient to give rise to a duty to disclose.”  (Complaint, ¶ 32(c).)  The complaint further alleges without any specificity that every defendant actively concealed material facts from Marni Regan.  (Complaint, ¶ 32(b).)  The complaint fails to plead this cause of action with any specificity against Defendant and is therefore defective.

Further, as explained above, Plaintiffs’ discovery responses and Marni Regan’s deposition did not identify any specific affirmative statement Defendant made to Marni Regan or any relationship or transaction between Defendant and Marni Regan.  Therefore, the burden is shifted to Plaintiffs.  In their opposition, Plaintiffs do not cite any evidence that Defendant and Marni Regan had any direct dealings.    

Because the complaint is defective and fails to give Defendant any notice about the alleged fraud, and because Plaintiffs have not shown any evidence that Marni Regan had direct dealings with Defendant, this cause of action fails.

The motion for summary adjudication is granted.

D.        Sections 1709, 1710, and 1711

            In opposition, Plaintiff contends it is asserting a cause of action under Civil Code sections 1709, 1710, and 1711.  (Opposition at p. 14.)  The complaint refers to sections 1708, 1709, and 1710.  (Complaint, ¶ 35.) 

Section 1708 states generally that a person is to abstain from injuring another person.  That does not create a cause of action. 

Sections 1709 and 1710 state that a person may be liable for damage caused by willful deceit, defined as including “[t]he suggestion, as a fact, of that which is not true, by one who does not believe it to be true,” [t]he assertion, as a fact, of that which is not true, by one who has no reasonable ground for believing it to be true,” “[t]he suppression of a fact, by one who is bound to disclose it, or who give information of other facts which are likely to mislead for want of communication of that fact,” and “[a] promise, made without any intention of performing it.”  As discussed above, these claims of misrepresentations and fraudulent concealment fall because they require statements to the defendant or direct dealings between the plaintiff and defendant, and Plaintiffs have not shown any evidence of that.

Section 1711 states, “One who practices a deceit with intent to defraud the public . . . is deemed to have intended to defraud every individual in that class, who is actually misled by the deceit.”  The complaint does not mention section 1711.  In any event, Marni Regan admitted to have no knowledge of any statements from Defendant and therefore could not have been actually misled by any statement of Defendant.

The motion for summary adjudication is granted.

E.        Conspiracy to Commit Fraud

Because the underlying fraud claims fail, this claim fails as well.

            The motion for summary adjudication is granted.

            F.         Punitive Damages

            Defendant contends Plaintiffs cannot prove an officer, director, or managing agent of Defendant acted with malice, fraud or oppression.  (Motion at p. 15.)  Defendant cites to its Undisputed Material Facts (“UMF”) 1-5 in support of this argument.  UMF 1-4 merely restate the allegations in the complaint.  UMF 5 summarizes the stipulation that Marni Regan has no knowledge about Defendant.  This evidence does not show that Plaintiffs cannot reasonably obtain evidence that an officer, director, or managing agent of Defendant acted with malice, fraud or oppression.  For example, Plaintiffs could take discovery of Defendant and find in Defendant’s files or through Defendant’s witnesses such evidence.

            Because Defendant did not satisfy its initial burden, the motion is denied.

            The motion for summary adjudication is GRANTED as to the third cause of action for fraud and denied as to the request for punitive damages.

III.       Central Garden and Farnam’s Motion to Bifurcate or Sever

            Defendant moves to bifurcate or sever the issue of whether it has liability for pre-purchase claims.  Successor liability is an equitable issue to be tried by the court.  How the court orders the trial of equitable and legal issues is for the trial court to decide.  Therefore, the motion is OFF CALENDAR.  The parties can raise the issue of the order of trial with the trial court.

            The moving party is to give notice.