Judge: Mark H. Epstein, Case: 23SMCV06068, Date: 2025-01-27 Tentative Ruling
Case Number: 23SMCV06068 Hearing Date: January 27, 2025 Dept: I
The demurrer is SUSTAINED WITH LEAVE TO AMEND. This is a case alleging sexual assault and
misconduct by the defendants, which include some jural entities as well as an
individual. Plaintiff alleges that in
April and May 2002, she and Markoff met to discuss saving an historic property
in Los Angeles. Eventually, defendant
Markoff allegedly invited plaintiff and her husband to his Big Bear residence
to discuss the deal’s framework. Plaintiff
alleges that Markoff made unwanted sexual advances and engaged in sexual
assault with which she put up due to the business deal under discussion. In May 2002, Markoff allegedly told plaintiff
she would have to get insurance for the property that would cost about $5200,
which plaintiff did not have. Markoff
purportedly told plaintiff to come to his home to get a check. Plaintiff contends that Markoff invited her
inside and gave her a cookie, which she ate, as well as a one page document he
wanted her to sign before giving her the check.
Plaintiff says that things started to get fuzzy for her after eating the
cookie and she was manipulated into signing the document, which turned out to
be a joint venture agreement. Plaintiff
believes that the cookie contained marijuana.
The contract is, plaintiff states, very one-sided. Plaintiff states that defendants used that
contract as leverage to cover-up Markoff’s misconduct in Big Bear by
threatening to destroy plaintiff and her husband using the contract. Markoff also allegedly repeated his unwanted
sexual advances and assaults against plaintiff during May and June 2002. Markoff missed an escrow-related deadline in
June 2002, and plaintiff wanted to end the business, but defendants began to
bully plaintiff (according to the complaint) so she stayed silent. Plaintiff asserts she was forced to quit
working with defendants and withdrew from the venture in June 2002 due to the
total effect of Markoff’s sexual misconduct.
Plaintiff alleges that there were two later suits against Markoff before
Judge Biederman, apparently in about 2007, and that those furthered Markoff’s
cover-up of the sexual assaults and that the judge’s conduct assisted in that
endeavor. Plaintiff states that she
tried to tell her story of sexual assault to the press during the trial, but
Markoff suppressed the articles.
Plaintiff contends that Markoff’s conduct included sexual assault of her
inside the courtroom. Plaintiff says
that when she tried to tell the judge about it, the judge removed Markoff from
the trial table. Plaintiff states that
she was told by producers that they could not make a film about Markoff’s
sexual assault of her due to Markoff’s power in the film industry. On December 29,2023, plaintiff brought this
suit against defendants. Markoff and
Palm Finance Corporation have filed the instant demurrer to the fourth amended
complaint and plaintiff opposes.
Plaintiff filed her timely opposition on January 13, 2025, and an
amended one a day late, on January 14, 2025.
The court has considered the January 14, 2025, submission, to which
defendant did not object.
The demurrer has three arguments. The first, and major, argument is that the
case is barred by the statute of limitations.
The second is a failure to plead adequately. The third is that plaintiff ought not proceed
as a DOE. Far and away the biggest
argument is the statute of limitations.
No one disputes that under traditional statutes of
limitations, this case would be time-barred.
Many of the events occurred in 2002, and the most recent appears to have
been in 2007 or so. Suit was not filed
until over 16 years after the most recent event—well beyond any limitations
period. Plaintiff’s theory is that the
suit is saved by Code of Civil Procedure section 340.16(e)(1). That statute revives sexual assault causes of
action that have expired if certain criteria are met. Specifically, that statute gives a plaintiff
until December 31, 2023, to file “any claim seeking to recover damages suffered
as a result of a sexual assault that occurred on or after the plaintiff’s 18th
birthday that would otherwise be barred before January 1, 2023, solely because
the statute of limitations has expired.”
No one disputes plaintiff meets that test. She was over 18 when the events occurred—even
the ones in 2002. And her suit would be
barred as of January 1, 2023. Finally,
she brought the suit prior to December 31, 2023. The issue is joined by subdivision (e)(2)(C),
which establishes the 1 year revival window only where the plaintiff alleges
that the “entity or entities . . . engaged in a cover up or attempted a cover
up of a previous instance or allegations of sexual assault by an alleged
perpetrator of such abuse.” “Cover up”
is defined as “a concerted effort to hide evidence relating to a sexual assault
that incentivizes individuals to remain silent or prevents information relating
to a sexual assault from becoming public or being disclosed to the plaintiff,
including, but not limited to, the use of nondisclosure agreements or
confidentiality agreements.”
The moving parties contend that this statute requires that
the cover-up relate to a person other than the plaintiff and that it occur
before the alleged assault against plaintiff.
The moving parties also contend that the cover up must be for their
benefit—that is, that an entity that helps a third party cover up the third
party’s sexual assault would not count.
Plaintiff disagrees.
Plaintiff’s allegations in support of a cover up largely go
to the Playboy Mansion. In its heyday,
the Playboy Mansion was notorious for sexual behavior and misbehavior that
occurred there. The darker side of the
story, which was not told more formally for many years, was that many of the
women who participated in the sexual activity did so against their will. Plaintiff alleges that Markoff, in his
capacity as CEO of Palm Finance, regularly attended those parties and had sex
with a number of the women there.
Plaintiff alleges that some of those women were drugged or raped. (4AC par. 42.) Markoff wrote off the expenditures as
business expenses, and it is further alleged that women attended those parties
to obtain opportunities in the film industry, of which Markoff was allegedly a
major part. (Id., at par.
45.) Plaintiff asserts that there was a
cover up relating to hose parties. There
was a clean up crew to hide evidence, women were coerced into signing away
important rights and that their supposed agreements—sometimes signed when the
women were drugged—were used to blackmail the women, as were pictures and
videos of the women performing sexual acts or taken when they were in
compromising positions. (Id., at
pars. 49-50.)
Those allegations are certainly allegations of a cover
up. The problem is that it is not clear
what role, if any, Markoff or Palm Finance had in the cover up. A cover up by Playboy or Heffner will not do;
they are not defendants here. Markoff’s
alleged participation in the sexual misconduct at the Playboy Mansion is not
enough because there is no evidence that Markoff or Palm Finance engaged in the
cover up. In short, plaintiff has not
adequately linked the cover ups at the Playboy Mansion with cover up activity
by Markoff or Palm Finance. Without that
link, the statute’s requirements are not met, for the statute requires that the
“entity or entities” engaged in the cover up; not that another third party did
so. The court also agrees with the
defense that the cover up be for the benefit of the entity or entities, not a
third party. There is also a question
whether the “entity” can be a human.
“Entity” is defined as “a sole proprietorship, partnership, limited
liability company, corporation, association, or other legal entity.” Oddly missing from that list is a human. Of course, a human is a sort of legal entity,
but the more natural reading of that term coming (as it does) at the end of the
list of legally created entities strongly suggests that it was meant as a catch
all for something like a limited liability partnership or some other jural
entity that the Legislature might create rather than being a natural person. That said, Palm Finance is an “entity” under
the statutory definition; it is just unclear that Markoff is. (It might not matter, though. The complaint is broad enough to assert that
the individuals acted in concert and the court would guess that Markoff will be
alleged to have alter ego liability, which would be enough.)
Plaintiff also argues that things like the May 2002 contract
that Markoff made her sign while she had been allegedly drugged constitutes a
cover up. To the extent that the conduct
can be attributed to Palm Finance (which it likely can as a pleading matter),
that would be a cover up within the definition of cover up, at least if one
reads the phrase “to the plaintiff” as modifying only the word
“disclosed.” But there are two problems
with using the 2002 events. The first is
defendants’ argument that the cover up must be as to a different person. The point, they argue, of the statute was to
deal with the “me, too” movement. That
movement recognized that the point of the cover up was to make the victim of a
later sexual assault believe that she or he was the only one, thereby making it
far more difficult to come forward and bring a suit, especially against the
powerful. That purpose, defendants
assert, is not furthered if the cover up relates only to the plaintiff. On the other hand, there is nothing in the
definition that expressly requires that the cover up be as to a separate
person. Defendants’ position has some
appeal; after all, if the cover up involves only one person (but multiple
times), it is not really a “cover up” in the same way. By definition, the defendant is not covering
up the sexual assault to keep knowledge from the only other person who by
definition already has knowledge.
Another problem is that it almost certainly the case that the cover up
had to happen in the past. That is plain
from the past tense (“engaged in a cover up or attempted a cover up”) and also
the express use of the word “previous.”
As such, covering up the 2002 events would not be sufficient to bring
the allegations relating to those events within the statute. That leaves plaintiff with the argument that
the 2002 events constitute a cover up and would bring the 2007 event within the
statute. To put it all together, it
seems to be that plaintiff is alleging that she was sexually assaulted by
Markoff in 2002 and that Markoff used the contract she signed at that time to
cover up the 2002 wrongdoing (or Palm Finance did). Then, in 2007, when she brought suit against
Markoff for the 2002 events, his sexual assault at that time comes within the
statute based on his earlier cover up back in 2002. The court notes that this is a pretty think
chain of reasoning. The court’s point is
not the factual one; that is something that cannot be addressed on
demurrer. It is the legal one: does the
cover up have to involve a third person, can Markoff be within the statute
himself or only through an entity, and can the 2002 cover up be used to extend
the statute of limitations for 2007 misconduct based on what appears to have
been a lawsuit alleging sexual misconduct in which further misconduct took
place. Relatedly, is there any link that
can be forged between the alleged misdeeds at the Playboy Mansion and cover up
activity by Markoff or Palm Finance. And
as a final overlay, there is an odd statutory construction question. This is plainly a revival statute. Not only does it have the effect of reviving
claims that had already expired, it expressly states that such claims are
“hereby revived.” Revival statutes are
generally narrowly construed. On the
other hand, the Legislature’s goal was obviously to aid those it considered to
be victims of wrongdoing, and in that way the statute is more of one that would
be construed broadly. The court also
wonders how, if the 2007 case involved the 2002 events, that case did not
resolve this one, at least as it relates to 2002.
The court well understands that this is plaintiff’s fifth
effort to allege facts that will survive the pleading stage, although not the
fifth litigated attempt. But justice
suggests that the court given plaintiff one, and only one, last chance to
address the foregoing concerns.
The court also turns to the fourth and sixth causes of
action, brought under FEHA. The demurrer
to that extent is SUSTAINED WITH LEAVE TO AMEND. The court does not see how plaintiff was an
employee of the moving defendants.
Absent an employer/employee relationship, these causes of action cannot
stand. The only reason leave to amend is
being given here is because it is being given generally under the statute of
limitations issue. Frankly, plaintiff
might be well advised to let those causes of action go.
The second cause of action is for gender violence. Palm Finance demurs, arguing that the statute
applies only to humans, not jural entities.
That is not quite the case. The
statute state that it “does not establish any civil liability of a person
because of his or her status as an employer, unless the employer personally
committed an act of gender violence.”
Only humans can “personally” conduct any act. But the statute in general states that a
victim of gender violence can bring an action against “any responsible
party.” The court does not see why
Markoff would not come within the statute.
The harder question is the statute of limitations, discussed above. The demurrer in this regard is SUSTAINED WITH
LEAVE TO AMEND, essentially on the statute of limitations issue.
Finally, defendants challenge plaintiff’s use of a
pseudonym, in part because she never sought leave of court. The use of a pseudonym requires that the
court conduct a hearing and apply the overriding interest test. (Department of Fair Employment and Housing
v. Superior Court (2022) 82 Cal.App.5th 105.) There is an exception where a statute
specifically authorizes the use of a pseudonym, but the court is not aware of
any such statute here. And further, such
a use should occur “only in the rarest of circumstances.” (Id., at pp. 111-112.) But it is not fair to make plaintiff adhere
to that test in a demurrer. A demurrer
is not a speaking motion and plaintiff therefore cannot introduce evidence to
meet her burden. The court will
therefore OVERRULE the demurrer.
However, the order is WITHOUT PREJUDICE to a separate motion.