Judge: Michael E. Whitaker, Case: 19STCV20310, Date: 2023-03-21 Tentative Ruling

Case Number: 19STCV20310    Hearing Date: March 21, 2023    Dept: 32

PLEASE NOTE:   Parties are encouraged to meet and confer concerning this tentative ruling to determine if a resolution may be reached.  If the parties are unable to reach a resolution and a party intends to submit on this tentative ruling, the party must send an email to the Court at sscdept32@lacourt.org indicating that party’s intention to submit.  The email shall include the case number, date and time of the hearing, counsel’s contact information (if applicable), and the identity of the party submitting on this tentative ruling.  If the Court does not receive an email indicating the parties are submitting on this tentative ruling and there are no appearances at the hearing, the Court may place the motion off calendar or adopt the tentative ruling as the order of the Court.  If all parties do not submit on this tentative ruling, they should arrange to appear in-person or remotely (which is highly encouraged).  Further, after the Court has posted/issued a tentative ruling, the Court has the inherent authority to prohibit the withdrawal of the subject motion and adopt the tentative ruling as the order of the Court. 

TENTATIVE RULING

MOTION

Plaintiff Rebecca Scherer (Plaintiff) sued Defendants Douglas Emmett 1998 LLC, Encino Gateway, a corporation, Universal Protection Service LP, Mitsubishi Electric, and Brandon O’Brien, based on an alleged abrupt stop and elevator entrapment in a commercial building.

Defendants Douglas Emmett 1998, LLC and Mitsubishi Electric US, Inc. (Moving Defendants) move to strike Plaintiff’s claim for punitive damages and related portions of the First Amended Complaint (FAC).  Plaintiff opposes the motion.  Defendants reply.

ANALYSIS

1. MOTION TO STRIKE

Any party, within the time allowed to respond to a pleading, may serve and file a motion to strike the whole pleading or any part thereof.  (Code Civ. Proc., § 435, subd. (b)(1); Cal. Rules of Court, rule 3.1322, subd. (b).)  On a motion to strike, the court may: (1) strike out any irrelevant, false, or improper matter inserted in any pleading; or (2) strike out all or any part of any pleading not drawn or filed in conformity with the laws of California, a court rule, or an order of the court.  (Code Civ. Proc., § 436, subds. (a)-(b); Stafford v. Shultz (1954) 42 Cal.2d 767, 782.)

In ruling on a motion to strike punitive damages, “judges read allegations of a pleading subject to a motion to strike as a whole, all parts in their context, and assume their truth.”  (Clauson v. Superior Court (1998) 67 Cal.App.4th 1253, 1255.)  To state a prima facie claim for punitive damages, a plaintiff must allege the elements set forth in the punitive damages statute, Civil Code section 3294.  (College Hosp., Inc. v. Superior Court (1994) 8 Cal.4th 704, 721.)  Per Civil Code section 3294, a plaintiff must allege that the defendant has been guilty of oppression, fraud, or malice.  (Civ. Code, § 3294, subd. (a).)   As set forth in the Civil Code,

(1) “Malice” means conduct which is intended by the defendant to cause injury to the plaintiff or despicable conduct which is carried on by the defendant with a willful and conscious disregard of the rights or safety of others.  (2) “Oppression” means despicable conduct that subjects a person to cruel and unjust hardship in conscious disregard of that person's rights.  (3) “Fraud” means an intentional misrepresentation, deceit, or concealment of a material fact known to the defendant with the intention on the part of the defendant of thereby depriving a person of property or legal rights or otherwise causing injury.

(Civ. Code, § 3294, subd. (c)(1)-(3), emphasis added.) 

Further, a plaintiff must assert facts with specificity to support a conclusion that a defendant acted with oppression, fraud or malice.  To wit, there is a heightened pleading requirement regarding a claim for punitive damages.  (See Smith v. Superior Court (1992) 10 Cal.App.4th 1033, 1041-1042.)  “When nondeliberate injury is charged, allegations that the defendant’s conduct was wrongful, willful, wanton, reckless or unlawful do not support a claim for exemplary damages; such allegations do not charge malice.  When a defendant must produce evidence in defense of an exemplary damage claim, fairness demands that he receive adequate notice of the kind of conduct charged against him.” (G. D. Searle & Co. v. Superior Court (1975) 49 Cal.App.3d 22, 29 [cleaned up].)  In Anschutz Entertainment Group, Inc. v. Snepp, the Court of Appeal noted that the plaintiffs’ assertions related to their claim for punitive damages were “insufficient to meet the specific pleading requirement.”  (Anschutz Entertainment Group, Inc. v. Snepp (2009) 171 Cal.App.4th 598, 643 [plaintiffs alleged “the conduct of Defendants was intentional, and done willfully, maliciously, with ill will towards Plaintiffs, and with conscious disregard for Plaintiff's rights. Plaintiff's injuries were exacerbated by the malicious conduct of Defendants. Defendants' conduct justifies an award of exemplary and punitive damages”]; see also Grieves v. Superior Court (1984) 157 Cal.App.3d 159, 166 [“The mere allegation an intentional tort was committed is not sufficient to warrant an award of punitive damages.  Not only must there be circumstances of oppression, fraud, or malice, but facts must be alleged in the pleading to support such a claim”].) 

            In addition, “[t]he imposition of punitive damages upon a corporation is based upon its own fault.  It is not imposed vicariously by virtue of the fault of others.”  (City Products Corp. v. Globe Indemnity Co. (1979) 88 Cal.App.3d 31, 36.)  “Corporations are legal entities which do not have minds capable of recklessness, wickedness, or intent to injure or deceive.  An award of punitive damages against a corporation therefore must rest on the malice of the corporation’s employees.  But the law does not impute every employee’s malice to the corporation.  Instead, the punitive damages statute requires proof of malice among corporate leaders:  the officers, directors, or managing agents.”  (Cruz v. Home Base (2000) 83 Cal.App.4th 160, 167 [cleaned up].) 

            Moreover, “[a]n employer shall not be liable for damages pursuant to subdivision (a), based upon acts of an employee of the employer, unless the employer had advance knowledge of the unfitness of the employee and employed him or her with a conscious disregard of the rights or safety of others or authorized or ratified the wrongful conduct for which the damages are awarded or was personally guilty of oppression, fraud, or malice. With respect to a corporate employer, the advance knowledge and conscious disregard, authorization, ratification or act of oppression, fraud, or malice must be on the part of an officer, director, or managing agent of the corporation.”  (Civ. Code, § 3294, subd. (b).)

Defendants move to strike Plaintiff’s claim for punitive damages.  Defendants argue the FAC fails to plead specific facts showing malice, oppression, recklessness, or fraud on the part of Defendants.  Defendants further argue Plaintiff’s punitive damages allegations against Defendants as corporate entities are deficient because Plaintiff fails to allege that a specific officer, director, or managing agent of each Defendant authorized, ratified, or knew of the alleged conduct of its employees. 

In opposition, Plaintiff points to the following allegations in support of her contention that the FAC pleads specific facts showing Defendants’ malice, oppression, and recklessness.  Plaintiff further attests that these allegations describe how Defendants’ managing agents knew of the dangerous condition which would eventually result in Plaintiff’s injuries, and yet did nothing:

·       Elevator number two (2) had repeated entrapment problems prior to and leading up to Plaintiff’s incident, including an injury event in August of 2015, whereby a passenger was traveling in elevator number two (2) and reported being trapped and suffered a neck injury.

·       The Elevator logs for elevator number two (2) show an entrapment occurred on January 30 of 2018, an entrapment on May 14, 2018, and entrapment on May 15 2018 and another entrapment no May 22 of 2018 leading up to the entrapment and injury to Plaintiff on May 31, 2018.

·       Service ticket history from Mitsubishi shows a number of entrapments with the elevators as well as other safety issues on dates leading up to Plaintiff’s injury date including an entrapment on January 15, 2016, an entry that the elevator “jerks” on February 12, 2016, another entrapment on March 11, 2016, rattling noises noted on March 24, 2016 for elevator number two (2), another entrapment on April 27, 2016, another entrapment in elevator number two (2) on June 15, 2016, three additional entrapments in elevator number two (2) on June 18, June 23rd and June 30th of 2016, another entrapment on June 22, 2017, reports of the doors hitting patrons on July 5, 2017, another entrapment on December 16, 2017.

·       Service logs pertaining to the elevator number two (2) show a record of repairs and changes to the door inter-lock system in the days prior to Plaintiff’s incident and injuries on May 30, 2018. The day before Plaintiff’s injury

·       DOUGLAS EMMETT, through its property manager or managing agent, was aware of the probable danger posed by elevator number two (2) and acted with a knowing disregard for the safety of the passengers of its elevators, by failing to properly warn passengers, or to take the malfunctioning elevator out of service until it was repaired.

·       DOUGLAS EMMETT, through its property manager or managing agent, was aware, due to the service calls, maintenance logs, reports and entrapments, that elevator number two (2) was a danger to its tenants, patrons and elevator passengers, and deliberately failed to avoid the probable consequences of the danger the elevator posed to those passengers.

·       MITSUBISHI, through its superintendent or managing agent, was also aware of the repeated entrapments, the repeated failures of the door locking mechanism, and the constant maintenance calls related to elevator number two (2). MITSUBISHI’s lack of action to properly maintain elevator number two (2), take elevator number two (2) out of service, or to properly warn the public of the danger of elevator number two (2) was despicable and was done with a willful and knowing disregard for the safety of the public, including Plaintiff.

·       DOUGLAS EMMETT, through its property manager or managing agent, was aware of the probable danger posed by elevator number two (2) and acted with a knowing disregard for the safety of the passengers of its elevators, by failing to properly warn passengers, or to take the malfunctioning elevator out of service until it was repaired.

·       DOUGLAS EMMETT, through its property manager or managing agent, was aware, due to the service calls, maintenance logs, reports and entrapments, that elevator number two (2) was a danger to its tenants, patrons and elevator passengers, and deliberately failed to avoid the probable consequences of the danger the elevator posed to those passengers.

·       MITSUBISHI, through its superintendent or managing agent, was also aware of the repeated entrapments, the repeated failures of the door locking mechanism, and the constant maintenance calls related to elevator number two (2). MITSUBISHI’s lack of action to properly maintain elevator number two (2), take elevator number two (2) out of service, or to properly warn the public of the danger of elevator number two (2) was despicable and was done with a willful and knowing disregard for the safety of the public, including plaintiff.

·       As an elevator maintenance company, MITSUBISHI, through its superintendent or managing agent, knew of the probable and dangerous consequences of failing to act as it relates to elevator number 2, and deliberately failed to avoid these consequences.

·        

(FAC, ¶¶ 17-20, 32-34, 44-47.) 

            The foregoing allegations describe that Defendants’ employees knew of the dangerous condition of the subject elevator, based on their receipt and access to pervasive documentation and numerous reports of the malfunctioning subject elevator, yet did nothing.  The Court finds these allegations sufficiently plead acts of malice. 

However, the Court agrees with Defendants in that the foregoing allegations fail to plead with sufficient specificity whether a managing agent of each Defendant authorized, ratified, or knew of and disregarded the above-described malicious conduct.  The FAC’s statements that Defendants knew of the malicious conduct in question “through its property manager or managing agent,” and “through its superintendent or managing agent” evince vague and generalized notions that someone within each of Defendants’ organizations knew of the conduct in question.  However, Cruz v. Home Base and Smith v. Superior Court read in conjunction with each other, require that pleadings allege with specificity that a managing agent authorized, ratified, or knew of the described malicious conduct.  This specificity requirement indicates that the pleadings must identify the managing agent who authorized, ratified, or knew of the described conduct.

In her opposition, Plaintiff argues that there was only one property manager for Defendant Douglas Emmet and one service superintendent or supervisor for Defendant Mitsubishi assigned to the property at issue at the relevant time.  Thus, Plaintiff concludes that her pleadings identifying Defendants’ property manager and superintendent are sufficient, as there was only one property manager and superintendent she could be referring to.  However, because Plaintiff does not explain these circumstances in her FAC, the Court finds the pleadings are too generalized to identify who Plaintiff is alluding to.

Accordingly, the Court finds Plaintiff’s allegations do not with sufficient specificity identify the managing agents of each respective Defendant corporation who ratified, authorized, or knew of and disregarded the described malicious conduct.  As such Plaintiff’s allegations fail to support a claim for punitive damages against Defendants, as corporate entities.  Therefore, the Court grants Defendants’ motion to strike punitive damages as to Defendants.  

2.     LEAVE TO AMEND

A plaintiff has the burden of showing in what manner the amended complaint could be amended and how the amendment would change the legal effect of the complaint, i.e., state a cause of action.  (See The Inland Oversight Committee v City of San Bernardino (2018) 27 Cal.App.5th 771, 779; PGA West Residential Assn., Inc. v Hulven Int'l, Inc. (2017) 14 Cal.App.5th 156, 189.)  A plaintiff must not only state the legal basis for the amendment, but also the factual allegations sufficient to state a cause of action or claim.  (See PGA West Residential Assn., Inc. v Hulven Int'l, Inc., supra, 14 Cal.App.5th at p. 189.)  Moreover, a plaintiff does not meet his or her burden by merely stating in the opposition to a demurrer or motion to strike that “if the Court finds the operative complaint deficient, plaintiff respectfully requests leave to amend.”  (See Major Clients Agency v Diemer (1998) 67 Cal.App.4th 1116, 1133; Graham v Bank of America (2014) 226 Cal.App.4th 594, 618 [asserting an abstract right to amend does not satisfy the burden].) 

In her opposition, Plaintiff notes that she is aware of further facts which support her claim for punitive damages against Defendants, as is reflected in her Motion to Permit Financial Discovery, filed with the Court on January 27, 2023.  Plaintiff’s Motion to Permit Financial Discovery advances and lays out for the Court evidence which purportedly establishes with substantial probability that Plaintiff will prevail on her punitive damages claim against Defendants. Plaintiff states she will add these additional facts to her pleadings if granted leave to amend.  Accordingly, the Court shall grant Plaintiff leave to amend.

CONCLUSION AND ORDER

Therefore, the Court grants Defendants’ motion to strike Plaintiff’s claim for punitive damages with leave to amend and orders Plaintiff to file and serve an amended complaint in conformity with the Court’s ruling on or before March 30, 2023. 

Due to the Court’s ruling on Defendants’ motion to strike, the Court shall continue the hearing on Plaintiff’s motion for an order permitting the discovery of Defendants’ financial conditions to April 13, 2023 at 1:30 PM in Department 32.  No further briefs shall be filed by any party in connection with such motion. 

Defendants shall provide notice of the Court’s ruling and file a proof of service of such.