Judge: Matthew C. Braner, Case: 37-2023-00041997-CU-BT-CTL, Date: 2024-03-15 Tentative Ruling

SUPERIOR COURT OF CALIFORNIA,

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HALL OF JUSTICE

TENTATIVE RULINGS - March 14, 2024

03/15/2024  09:00:00 AM  C-60 COUNTY OF SAN DIEGO

JUDICIAL OFFICER:Matthew C. Braner

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Civil - Unlimited  Business Tort Demurrer / Motion to Strike 37-2023-00041997-CU-BT-CTL DMCG INC VS SYNERGY BAIL SERVICES INC [IMAGED] CAUSAL DOCUMENT/DATE FILED:

Defendants Synergy Bail Services, Inc., Alejandro Estrella, Arthur Navarro; Jorge Estrella, Enrique Garcia, Andres Valenzuela, Maria Estrella, Sahara Lopez, and Ivan Navarro's demurrer is SUSTAINED.

Plaintiff DMCG, Inc. did not file an opposition to Defendants' motion. Pursuant to this court's local rules, such failure to respond will be deemed a concession the motion has merit. (San Diego Local Rule 2.1.19.B.) A demurrer shall be sustained if the complaint 'does not state facts sufficient to constitute a cause of action.' (Code Civ. Proc., § 430.10(e).) To test the sufficiency of a cause of action, the court treats as true 'all material facts properly pleaded, but not contentions, deductions or conclusions of fact or law.' (Centinela Freeman Emergency Medical Associates v. Health Net of California, Inc. (2016) 1 Cal.5th 994, 1010.) The court may also consider matters that have been judicially noticed. (Id.) The court shall give the complaint a 'reasonable interpretation, reading it as a whole and its parts in their context.' (Blank v. Kirwan (1985) 39 Cal.3d 311, 318.) Defendants demur to the fourth and fifth causes of action for intentional and negligent interference with prospective economic advantage, respectively, and to the eighth, tenth, eleventh, and fourteenth causes of action for breach of fiduciary duty, unfair competition, violation of RICO, and conversion, respectively.

As to the eighth, tenth, and fourteenth causes of action, Defendants contend they are preempted by Plaintiff's ninth cause of action for misappropriation of trade secrets under the California Uniform Trade Secrets Act, as they each are based on and arise from Defendants' alleged use of confidential information. The court agrees. '[S]ection 3426.7, subdivision (b), preempts common law claims that are 'based on the same nucleus of facts as the misappropriation of trade secrets claim for relief.'' (K.C.

Multimedia, Inc. v. Bank of America Technology & Operations, Inc. (2009) 171 Cal.App.4th 939, 958; Civ.

Code, § 3426.7, subd. (b).) Here, the complaint tethers Defendants' alleged breach of fiduciary duty (which it also calls a breach of the duty of loyalty) to 'using Plaintiff's confidential and proprietary business information and providing it said [sic] competitor of Plaintiff.' (Complaint, ¶ 57.) Similarly, Plaintiff's claims for unfair competition and conversion arise from Defendants' alleged 'use of the Confidential Information obtained improperly from Plaintiff,' (Complaint, ¶ 69), and 'conver[sion] for their own use proprietary information belonging to Plaintiff.' (Complaint, ¶ 87.) The same purported theft and misuse of confidential information forms the basis for Plaintiff's claim under CUTSA. (Complaint, ¶¶ 61-64.) As to the fourth and fifth causes of action, Plaintiff has failed to allege facts to show that Defendants' Calendar No.: Event ID:  TENTATIVE RULINGS

3068508  16 CASE NUMBER: CASE TITLE:  DMCG INC VS SYNERGY BAIL SERVICES INC [IMAGED]  37-2023-00041997-CU-BT-CTL conduct was independently wrongful apart from the purported theft and misuse of confidential information. Without such factual allegations, the claims are either insufficiently pled, or they are preempted by CUTSA.

Finally, as to the eleventh cause of action under RICO, Plaintiff has failed to allege sufficient facts to support the elements of racketeering activity and an effect on interstate commerce. (Eclectic Properties, LLC v. Marcus & Millichap Co. (9th Cir. 2014) 751 F.3d 990, 997 [the elements of a claim under RICO are: 1) participation in conduct that affects interstate commerce; 2) through a pattern of racketeering activity or collection of unlawful debt; and 3) that is the proximate cause of harm to the victim].) Instead of providing facts to support its claim, Plaintiff at best states the elements for the claim and in conclusory fashion alleges the elements have been satisfied. As currently pled, the claim cannot survive demurrer.

Accordingly, Defendants' demurrer is sustained with leave to amend.

Plaintiff has 30 days from entry of this order to file and serve a first amended complaint.

The minute order is the order of the court.

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3068508  16