Judge: Michael E. Whitaker, Case: 23SMCV05914, Date: 2024-10-24 Tentative Ruling

Case Number: 23SMCV05914    Hearing Date: October 24, 2024    Dept: 207

TENTATIVE RULING

MOTIONS

This case arises from a dispute concerning the purchase of a large, outdoor television, that is allegedly defective. 

Plaintiff D Art Furnishings LLC’s (“Plaintiff”) operative First Amended Complaint alleges ten causes of action against Defendants C Seed Inc. (“C Seed”) and Porche Design (“Porche”) (together, “Defendants”) for (1) breach of written contract; (2) breach of implied covenant of good faith and fair dealing; (3) breach of express warranty – Song Beverly Act – Damages; (4) breach of implied warranty – Song Beverly Act – Rescission; (5) fraudulent misrepresentation; (6) negligent misrepresentation; (7) unjust enrichment/restitution; (8) violations of Civil Code section 895 et seq.; (9) violation of Bus. & Prof. Code section 7031(B)/Disgorgement; and (10) violation of Bus. & Prof. Code section 17200. 

C Seed now demurs to the second, third, fourth, fifth, sixth, seventh, eighth, ninth, and tenth causes of action on the grounds that they fail to state facts sufficient to constitute a cause of action under Code of Civil Procedure section 430.10, subdivision (e). 

C Seed also moves to strike various factual allegations “as either impertinent, conclusory and/or not supported by facts, seeks remedies not available in causes of action it pled, or fails to adequately allege entitlement to punitive damages.”

Plaintiff opposes both motions and C Seed replies.

ANALYSIS

                I.          DEMURRER

“It is black letter law that a demurrer tests the legal sufficiency of the allegations in a complaint.”  (Lewis v. Safeway, Inc. (2015) 235 Cal.App.4th 385, 388.)  In testing the sufficiency of a cause of action, a court accepts “[a]s true all material facts properly pled and matters which may be judicially noticed but disregard contentions, deductions or conclusions of fact or law.  [A court also gives] the complaint a reasonable interpretation, reading it as a whole and its parts in their context.”  (290 Division (EAT), LLC v. City & County of San Francisco (2022) 86 Cal.App.5th 439, 450 [cleaned up]; Hacker v. Homeward Residential, Inc. (2018) 26 Cal.App.5th 270, 280 [“in considering the merits of a demurrer, however, “the facts alleged in the pleading are deemed to be true, however improbable they may be”].)

Further, in ruling on a demurrer, a court must “liberally construe” the allegations of the complaint “with a view to substantial justice between the parties.”  (See Code Civ. Proc., § 452.)  “This rule of liberal construction means that the reviewing court draws inferences favorable to the plaintiff, not the defendant.”  (Perez v. Golden Empire Transit Dist. (2012) 209 Cal.App.4th 1228, 1238.)  

In summary, “[d]etermining whether the complaint is sufficient as against the demurrer on the ground that it does not state facts sufficient to constitute a cause of action, the rule is that if on consideration of all the facts stated it appears the plaintiff is entitled to any relief at the hands of the court against the defendants the complaint will be held good although the facts may not be clearly stated, or may be intermingled with a statement of other facts irrelevant to the cause of action shown, or although the plaintiff may demand relief to which he is not entitled under the facts alleged.”  (Gressley v. Williams (1961) 193 Cal.App.2d 636, 639.)

A.    FAILURE TO STATE A CAUSE OF ACTION

1.     Second Cause of Action – Breach of Implied Covenant of Good Faith and Fair Dealing

“Implied in every contract is a covenant of good faith and fair dealing. The implied covenant prevents one side from unfairly frustrating the other's right to receive the benefits of the agreement actually made. The covenant does not impose substantive terms beyond those of the contract. A plaintiff claiming breach must allege the defendant's wrongful conduct was contrary to the contract's purpose and the parties’ legitimate expectations.”  (Cordoba Corp. v. City of Industry (2023) 87 Cal.App.5th 145, 156.)

However, tort recovery for a breach of the implied covenant of good faith and fair dealing is generally only available in cases involving an insurance contract, where an independent duty arises from principles of tort law, or where there has been a bad faith denial of the existence of or liability under the breached contract.  (Freeman & Mills, Inc. v. Belcher Oil Co. (1995) 11 Cal.4th 85, 102.)  Otherwise, “a breach of the implied covenant of good faith is a breach of the contract” although “breach of a specific provision of the contract is not ... necessary” to a claim for breach of the implied covenant of good faith and fair dealing[.]” ( Thrifty Payless, Inc. v. The Americana at Brand, LLC (2013) 218 Cal.App.4th 1230, 1244.)

C Seed points out that this is not an insurance contract, and therefore tort liability for the breach of the implied covenant is not available.  Further C Seed contends that the second cause of action is duplicative of the breach of contract cause of action, and is therefore superfluous. 

In opposition, Plaintiff argues that “Defendant’s breach of implied covenant includes their conscious and deliberate acts of refusing to cure the malfunctioning television” which is “separate from the express terms of the Contract and thus is not superfluous.” 

Plaintiff alleges Defendants breached the contract by failing to supply a television with the attributes and functionality promised (FAC ¶¶ 34-39), and that Defendants breached the express warranty by failing to cure the deficiencies or replace the television.  (FAC ¶¶ 49-60.)

Thus, “refusing to cure the malfunctioning television” is just the alleged breach of contract and of the express warranty; as such, the breach of the implied covenant is not separate from the express terms of the contract and warranty.

Therefore, the Court sustains Defendants’ demurrer to the second cause of action.

2.                 Third Cause of Action – Breach of Express Warranty

“The essential elements of a cause of action under the California Uniform Commercial Code for breach of an express warranty to repair defects are (1) an express warranty (Com. Code, § 2313) to repair defects given in connection with the sale of goods; (2) the existence of a defect covered by the warranty; (3) the buyer's notice to the seller of such a defect within a reasonable time after its discovery (id., § 2607, subd. (3)(A)); (4) the seller's failure to repair the defect in compliance with the warranty; and (5) resulting damages[.]”  (Orichian v. BMW of North America, LLC (2014) 226 Cal.App.4th 1322, 1333–1334.)  Here, the FAC alleges:

12. On or around May 30, 2019, C SEED and Plaintiff entered into a written Agreement (the “Contract”), in which C SEED would order, ship install and construct the C SEED 201 HL Outdoor LED TV with horizontal hydraulic lifting system (the “TV”) onto the Property for the Owner of the Property. The Contract is executed by Plaintiff and C SEED. A true and correct copy of the Contract is attached hereto as Exhibit B and is fully incorporated herein by this reference.

13. In the Contract, the express warranty period is outlined as being two (2) years long

[…]

16. In or around February 2021, the TV was installed by C SEED.

[…]

19. In fact, the below is a true and accurate list of defects involving the TV at the Property:

a. At times, the TV will not go down fully

b. At times, the C SEED remote does not operate.

c. At times, the TV would not open and rotate.

d. At times, the TV audio would not work.

e. The sensor needs to be replaced.

f. C SEED admitted they failed to make updates to their software.

g. The Power supply was defective and needed to be replaced. It won’t allow the right side of the TV to fold and close.

h. At times, when trying to bring the TV down, the TV suddenly stopped moving and was stuck at a 45 degree angle. C SEED admits the mms froze and wasn’t able to convert any commands.

i. At times, the TV failed to open - the lid got stuck at the open position.

j. At times, the TV does not have video.

k. At times, the TV will not rotate left or right.

                        […]

21. In an attempt to resolve the issues outlined herein, Owner communicated the above issues regarding the TV after the TV was initially attempted to be installed up to the present. Moreover, due to such deficiencies with the TV, the Owner has allowed C SEED to visit the Property multiple times and has allowed unlimited access to the TV to make repairs; unfortunately, C SEED has not been able to resolve the deficiencies and defects to this day. Accordingly, the delivery of the product and the installation was never completed to this day.

22. Additionally, due to the failure to complete the repairs by C SEED, Owner, on or around December 9, 2021, sent a comprehensive notice containing a detailed timeline outlining all the issues encountered and the subsequent attempts made to remedy them. Accordingly, in the alternative, the December 9th notice served as proper written notice under Cal. Civ. Code § 1795.6 which tolls the warranty period. A true and correct copy of the email dated December 9, 2021, is attached hereto as Exhibit C and is fully incorporated herein by reference.

23. In fact, Owner and its representatives had sent notices to C SEED prior to December 9, 2021 and the December 9, 2021, notice contains a comprehensive list of all the deficiencies, with dates, experienced by the Owner with its operation of the TV that C SEED was previously notified of. In fact, on or around June 4, 2021, PLUS Development, the project manager at the time, had notified C SEED indicating that the TV’s sensors to open and close the TV and audio were not working.

[…]

30. Moreover, the deficiencies in the TV were not readily apparent at the time of purchase and only manifested over an extended period, constituting a concealed defect

[…]

50. The only express warranty provided by C SEED to Plaintiff is as follows: “Warranty; 2 Years”.

51. C SEED failed to include the statutory and mandatory express warranty language as outlined in Cal. Civ. Code § 1793.02(a) which is as follows: “all new and used assistive devices sold at retail in this state shall be accompanied by the retail seller's written warranty which shall contain the following language: “This assistive device is warranted to be specifically fit for the particular needs of you, the buyer. If the device is not specifically fit for your particular needs, it may be returned to the seller within 30 days of the date of actual receipt by you or completion of fitting by the seller, whichever occurs later. If you return the device, the seller will either adjust or replace the device or promptly refund the total amount paid. This warranty does not affect the protections and remedies you have under other laws.” In lieu of the words “30 days” the retail seller may specify any longer period.” (emphasis added).

52. More importantly, the express warranty period, as provided by C SEED, is tolled; “(a)(1) Except as provided in paragraph (2) warranty1 period relating to an implied or express warranty accompanying a sale or consignment for sale of consumer goods selling for fifty dollars ($50) or more shall automatically be tolled for the period from the date upon which the buyer either (1) delivers nonconforming goods to the manufacturer or seller for warranty repairs or service or (2), pursuant to subdivision (c) of Section 1793.2 or Section 1793.22, notifies the manufacturer or seller of the nonconformity of the goods up to, and including, the date upon which (1) the repaired or serviced goods are delivered to the buyer, (2) the buyer is notified the goods are repaired or serviced and are available for the buyer's possession or (3) the buyer is notified that repairs or service is completed, if repairs or service is made at the buyer's residence. Cal. Civ. Code § 1795.6 (a)(1).As indicated above, there was a sale of goods, specifically a new and “revolutionary” product, in which Defendant C SEED was the seller of the TV to Plaintiff and Plaintiff was the buyer of the TV.

53. Moreover, because this was a sale of goods, California Code, Commercial Code Section 2313 states the following: “(1) Express warranties by the seller are created as follows: (b) Any description of the goods which is made part of the basis of the bargain creates an express warranty that the goods shall conform to the description.” Additionally, California Code, Commercial Code Section 2313 continues to state that “(2) It is not necessary to the creation of an express warranty that the seller use formal words such as “warrant” or “guarantee” or that he have a specific intention to make a warranty, but an affirmation merely of the value of the goods or a statement purporting to be merely the seller's opinion or commendation of the goods does not create a warranty.”

54. In fact, until present, Plaintiff has continually communicated the deficiencies and defects of the TV and has attempted to informally resolve the deficient TV sold to Plaintiff by C SEED.

55. Despite such communications, C SEED continues to fail and refuse, to cure said issues, which is in direct violation, amongst other things, with Cal. Civ. Code § 1793.02(2)(A)(c), which provides as follows: “If the buyer returns the device within the period specified in the written warranty, the seller shall, without charge and within a reasonable time, adjust the device or, if appropriate, replace it with a device that is specifically fit for the particular needs of the buyer. If the seller does not adjust or replace the device so that it is specifically fit for the particular needs of the buyer, the seller shall promptly refund to the buyer the total amount paid, the transaction shall be deemed rescinded, and the seller shall promptly return to the buyer all payments and any assistive device or other consideration exchanged as part of the transaction and shall promptly cancel or cause to be canceled all contracts, instruments, and security agreements executed by the buyer in connection with the sale. When a sale is rescinded under this section, no charge, penalty, or other fee may be imposed in connection with the purchase, fitting, financing, or return of the device.”

56. Since February 2021 and until present, C SEED failed to deliver to Plaintiff a TV that is functional and operable, as indicated by the numerous defects outlined in this Complaint.

57. As indicated above, Plaintiff issued notice of each and every issue with the TV, prior to and including the notice on December 9, 2021, in which Plaintiff sent C SEED a comprehensive email containing a detailed timeline outlining all the issues encountered and the subsequent attempts made to remedy them

58. In bringing this Complaint, C SEED did not suffer any discernible prejudice from the Plaintiff. Over several months, Plaintiff actively collaborated with C SEED by promptly communicating issues and affording sufficient time for C SEED to undertake necessary repairs.

59. Despite the TV’s repeated failures, Plaintiff consistently provided opportunities for C SEED to resolve the situation, demonstrating a commitment to resolution through cooperation rather than resorting to litigation.

60. As such, there was a breach of express warranty by C SEED and such breach of warranty caused Plaintiff to suffer damages and C SEED is estopped from asserting any statute of limitations as alleged above as a defense to Plaintiff’s claim.

(FAC ¶¶ 12-13, 16, 19, 21-23, 30, 50-60.)

            Thus, Plaintiff has alleged (1) an express warranty (FAC ¶¶ 13, 50); (2) defects (FAC ¶ 19); (3) Plaintiff’s notice (FAC ¶¶ 21-23): (4) Defendants’ failure to cure (FAC ¶¶ 55-59); and (5) Plaintiff’s damages (FAC ¶¶ 60; see also Prayer at ¶¶ 6-7.)

            C Seed argues that Plaintiff must provide notice within a reasonable time, and it was not reasonable for Plaintiff to wait until February 9, 2022 to send a demand letter.  But Plaintiff alleges that although the purchase agreement was entered into in May 2019, the television was not actually delivered and installed until February 2021.  (See FAC ¶¶ 12, 16.)  It is axiomatic that Plaintiff would be unable to detect any defect prior to actually receiving the television.

            Further, Plaintiff alleges that it informally notified C Seed of the defects, and on December 9, 2021 sent C Seed formal written notice of the defects.  Moreover, Plaintiff alleges the defects were latent, and did not become apparent until sometime after Plaintiff began using the television on a regular basis.

            C Seed argues that demurrer is proper because Plaintiff does not specify exactly when Plaintiff discovered the defects.  But there is no heightened pleading requirement, and the only case law upon which C Seed relies on this point are non-binding federal district court cases.

            Thus, Plaintiff has adequately alleged that it provided C Seed notice within a reasonable time.  Whether the delay was in fact reasonable is a factual question to be determined at later stages of the litigation.

            Accordingly, the Court overrules C Seed’s demurrer to the third cause of action.

3.                 Fourth Cause of Action – Breach of Implied Warranty

Commercial Code section 2314 provides, “a warranty that the goods shall be merchantable is implied in a contract for their sale if the seller is a merchant with respect to goods of that kind.”  Further:

(2) Goods to be merchantable must be at least such as

(a) Pass without objection in the trade under the contract description; and

(b) In the case of fungible goods, are of fair average quality within the description; and

(c) Are fit for the ordinary purposes for which such goods are used; and

(d) Run, within the variations permitted by the agreement, of even kind, quality and quantity within each unit and among all units involved; and

(e) Are adequately contained, packaged, and labeled as the agreement may require; and

(f) Conform to the promises or affirmations of fact made on the container or label if any.

(Ibid.)  “Thus, a breach of the implied warranty of merchantability means the product did not possess even the most basic degree of fitness for ordinary use.”  (Mocek v. Alfa Leisure, Inc. (2003) 114 Cal.App.4th 402, 406.)

            Plaintiff lists the defects as follows:

19. In fact, the below is a true and accurate list of defects involving the TV at the Property:

a. At times, the TV will not go down fully

b. At times, the C SEED remote does not operate.

c. At times, the TV would not open and rotate.

d. At times, the TV audio would not work.

e. The sensor needs to be replaced.

f. C SEED admitted they failed to make updates to their software.

g. The Power supply was defective and needed to be replaced. It won’t allow the right side of the TV to fold and close.

h. At times, when trying to bring the TV down, the TV suddenly stopped moving and was stuck at a 45 degree angle. C SEED admits the mms froze and wasn’t able to convert any commands.

i. At times, the TV failed to open - the lid got stuck at the open position.

j. At times, the TV does not have video.

k. At times, the TV will not rotate left or right.

(FAC ¶ 19.)

            Thus, although some of the alleged defects, if analyzed in a vacuum, may not be enough in and of themselves to rise to the level of a defect impeding ordinary use, Plaintiff has adequately alleged that the TV would not reliably open, play video, or play audio, which is unquestionably the basic degree of fitness for ordinary use of a television.  A television must turn on and play video and sound in order to have a basic degree of fitness for ordinary use. 

            C Seed also argues that implied warranties are limited to one year or less, pursuant to Civil Code section 1791.1, subdivision (c).  But as discussed above, the television was delivered and installed in February 2021, and Plaintiff provided written notice of the defects on December 9, 2021, which is less than a year later.

            Finally, C Seed argues that the FAC does not allege whether Plaintiff accepted the television, rejected it, or is revoking its acceptance.  In support C Seed cites to Smigel Co., Inc. v. Jaguar Land Rover North America, LLC (2020) 55 Cal.App.5th 305, 315-316, which provides that the remedy where one has either rejected the goods or rescinded acceptance of the goods is the entire purchase price, whereas the remedy to one who has accepted the goods is the difference between the value they obtained and what they paid. 

            As a threshold matter, Smigel was decided after a jury trial; it does not stand for the proposition that demurrer is appropriate where the plaintiff fails to specify whether it has accepted, rescinded, or rejected the goods. 

            In any event, the FAC alleges, “72. As a proximate result of C SEED’s breach of implied warranty, Plaintiff paid in excess $1,000,000.00 to C SEED. Plaintiff demands the recission and restitution of all amounts paid to C SEED, as well as all other amounts allowed per law. Cal. Civ. Code § 1794.”  Thus, the FAC adequately alleges that Plaintiff seeks a full refund and rescission of the contract.  This suffices at the pleadings stage.

            Therefore, the Court overrules C Seed’s demurrer to the fourth cause of action.

4.                 Fifth and Sixth Causes of Action – Fraudulent and Negligent Misrepresentation

The elements for fraudulent misrepresentation are “(1) the defendant represented to the plaintiff that an important fact was true; (2) that representation was false; (3) the defendant knew that the representation was false when the defendant made it, or the defendant made the representation recklessly and without regard for its truth; (4) the defendant intended that the plaintiff rely on the representation; (5) the plaintiff reasonably relied on the representation; (6) the plaintiff was harmed; and (7) the plaintiff's reliance on the defendant's representation was a substantial factor in causing that harm to the plaintiff.”  (Graham v. Bank of America, N.A. (2014) 226 Cal.App.4th 594, 605–606.) 

“In California, fraud must be pled specifically; general and conclusory allegations do not suffice.”  (Lazar v. Superior Court (1996) 12 Cal.4th 631, 645.)  “This particularity requirement necessitates pleading facts which show how, when, where, to whom, and by what means the representations were tendered.”  (Ibid.) 

“The essential elements of a count for negligent misrepresentation are the same [as intentional misrepresentation] except that it does not require knowledge of falsity but instead requires a misrepresentation of fact by a person who has no reasonable grounds for believing it to be true.”  (Chapman v. Skype Inc. (2013) 220 Cal.App.4th 217, 230-231 (hereafter Chapman).)  Like intentional misrepresentation, causes of action for negligent misrepresentation sound in fraud, and must also, therefore, be pleaded with particularity.  (Ibid.) 

“One of the purposes of the specificity requirement is notice to the defendant, to furnish the defendant with certain definite charges which can be intelligently met.”  (Alfaro v. Community Housing Improvement System & Planning Assn., Inc. (2009) 171 Cal.App.4th 1356, 1384.)  As such, less specificity is required “when it appears from the nature of the allegations that the defendant must necessarily possess full information concerning the facts of the controversy[.]”  (Ibid.)  “Even under the strict rules of common law pleading, one of the canons was that less particularity is required when the facts lie more in the knowledge of the opposite party.”  (Ibid.)  Here, the FAC alleges as follows:

7. The TV purchased by Plaintiff and sold by C SEED, is advertised as the world’s largest outdoor television. This TV rises from its resting spot and unfolds to be around 17-foot of pure screen. This TV is one of the first of its kind, using new technology for not only its lifting features, but also its smart features.

8. As found on C SEED’s website at the time of purchase and currently, C SEED advertises its business and its TV as follows: “In 2013, C SEED changed the course of TV history, introducing the company´s first product and redefining “grand entrance” forever: The ground opens. A monumental back column rises up to first-floor height. On its top, an LED screen unfolds to a stunning, five-meter wide, dazzlingly bright display. At long last, lounging in the open air while enjoying the very best high-end sound and vision under the sun or the stars is available at the push of one single button.” A true and correct copy of a screenshot of C SEED’s website is attached hereto as Exhibit A and is fully incorporated herein by this reference.

9. Further, as advertised by C SEED, the TV purchased by Plaintiff is advertised as follows: “The world´s first outdoor LED TV is the literally groundbreaking success of a collaboration between C SEED and Porsche Design. They started out with the explicit intent to introduce an all-new luxury product category and wound up creating an award-winning style icon with impact across generations.” (Exhibit A)

10. Moreover, C SEED advertises that its TV has won the red dot design award and states the following on its website: “The sleek, functional look of the C SEED 201 has won the “red dot: best of the best” product design award. Porsche Design Studio has shaped this giant outdoor TV as a high-tech sculpture, combining elegant minimalism with a flamboyantly crowd-pleasing performance.” (Exhibit A)

11. In reliance on C SEED’s advertisement and its exclusive collaboration with Defendant, Porsche, Owner decided to enter into the written Contract described below with C SEED for its exclusive TV.

[…]

20. Moreover, Owner alleges on information and belief that Owner is not the only buyer that is experiencing continued issues and deficiency with its TV, and that there are other purchasers of the same TV, around the world, who, to date, are experiencing similar, if not exact, issues with the TV and C SEED’s failure to deliver a functional product to its customers. In fact, this seems to be a trend for C SEED and C SEED’s custom and practice is not to address the deficiencies for consumers required by law.

[…]

74. Defendants knowingly misrepresented the functionality and sophistication of the TV bought by Plaintiff for its Property.

75. Notwithstanding this representation, Defendants knew that its “new and innovative” TV was not yet ready to hit the market due to its numerous deficiencies and failure to properly perform, yet it sold the TV to Plaintiff.

76. More importantly, Defendants advertised that Defendant, Porsche, a well-known, reputable and luxury brand had designed the TV, so that it would attract high-end and luxury-oriented clients to buy a product from a new brand that had no well-known reputation during the relevant time period. Specifically, C SEED advertises that its TV has won the red dot design award and states the following on its website: “The sleek, functional look of the C SEED 201 has won the “red dot: best of the best” product design award. Porsche Design Studio has shaped this giant outdoor TV as a high-tech sculpture, combining elegant minimalism with a flamboyantly crowd-pleasing performance.” (Exhibit A)

77. Plaintiff, when making its decision in 2019 to purchase C SEED’s product, relied on Defendants representations about the TV, as marketed from 2019 (and still up until present) on C SEED’s website, and agreed to purchase the TV based on these representations.

78. Based on such representations made by C SEED on its website (Exhibit A), Plaintiff decided to purchase the TV back in 2019.

79. As a result of Plaintiff’s justifiable reliance on Defendants’ statements and advertisements regarding the TV, Plaintiff has suffered damages related to paying for the TV and having to deal with maintenance issues for the last three years.

80. Additionally, Defendants’ have engaged in fraudulent conduct. In fact, Defendants’ knew that Plaintiff would justifiably rely on Defendants’ statements and advertisements regarding the TV and such conduct was done with the intent to cause Plaintiff to purchase a TV that Defendants’ knew was unfit for its advertised purpose. Defendants’ were aware that such fraudulent conduct would cause these consequences and intentionally misrepresented and/or concealed material facts regarding the TV and did so intending to harm Plaintiff.

81. As a direct and proximate result of Defendants’ fraud, Plaintiff has been damaged in an amount according to proof, which include, but are not limited to, the recovery of punitive damages against Defendants’

[…]

83. Plaintiff has been harmed because Defendants affirmatively and negligently misrepresented the functionality and sophistication of the TV bought by Plaintiff for its Property and that Porsche was involved as alleged herein.

84. In fact, Defendants acted with the intent that Plaintiff would rely on its representatives and advertisements.

85. Notwithstanding this representation, Defendants knew that its “new and innovative” TV was not yet ready to hit the market due to its numerous deficiencies and failure to properly perform for others, yet it sold the TV to Plaintiff.

86. More importantly, Defendants advertised that Defendant, Porsche, a well-known, reputable and luxury brand had designed the TV, so that it would attract high-end and luxury-oriented clients to buy a product from a new brand that had no well-known reputation during the relevant time period. Specifically, C SEED advertises that its TV has won the red dot design award and states the following on its website: “The sleek, functional look of the C SEED 201 has won the “red dot: best of the best” product design award. Porsche Design Studio has shaped this giant outdoor TV as a high-tech sculpture, combining elegant minimalism with a flamboyantly crowd-pleasing performance.” (Exhibit A)

87. Plaintiff, when making its decision in 2019 to purchase C SEED’s product, relied on Defendants representations about the TV, as marketed from 2019 till present on C SEED’s website, and agreed to purchase the TV based on these representations.

88. Based on such representations made by C SEED, Plaintiff decided to purchase the TV .

89. As a result of Plaintiff’s justifiable reliance on Defendants’ statements and advertisements regarding the TV, Plaintiff has suffered damages related to paying for the TV and having to deal with maintenance issues for the last three years.

90. As a direct and proximate result of Defendants’ negligent misrepresentation, Plaintiff has been damaged in an amount according to proof.

(FAC ¶¶ 7-11, 20, 74-81, 83-90.)

            Thus, the only allegation regarding Defendants’ knowledge of the television defects at the time the representations were made is paragraph 85, alleged in connection with Plaintiff’s negligent misrepresentation cause of action: “Notwithstanding this representation, Defendants knew that its “new and innovative” TV was not yet ready to hit the market due to its numerous deficiencies and failure to properly perform for others, yet it sold the TV to Plaintiff.”  But this conclusory allegation is unsupported by any specific facts about what exactly Defendants knew and when.  An equally plausible conclusion from the facts alleged is that numerous TVs turned out to be defective, but Defendants were unaware of those defects at the time the alleged misrepresentations were made to Plaintiff. 

Thus, the FAC does not allege any specific facts demonstrating that Defendants either knew that its representations about the television were false or that it had no reasonable grounds to make those representations at the time they were made. 

As such, the Court sustains C Seed’s demurrer to the fifth and sixth causes of action.

5.                 Seventh Cause of Action – Unjust Enrichment

C Seed demurs to the seventh cause of action for unjust enrichment on the ground that there is no such cause of action for unjust enrichment.   The Court agrees. 

Notwithstanding Plaintiff’s allegations, the Court finds that the Seventh Cause of Action for Unjust Enrichment fails as a matter of law. 

[T]here is no cause of action in California for unjust enrichment. The phrase Unjust Enrichment does not describe a theory of recovery, but an effect: the result of a failure to make restitution under circumstances where it is equitable to do so.  Unjust enrichment is a general principle, underlying various legal doctrines and remedies, rather than a remedy itself. It is synonymous with restitution.

(Melchior v. New Line Productions, Inc. (2003) 106 Cal.App.4th 779, 793 [cleaned up]; accord Jogani v. Superior Court (2008) 165 Cal.App.4th 901, 911 [unjust enrichment is not a cause of action].) 

Consequently, the Court sustains C Seed’s demurrer to the seventh cause of action.

6.                 Eighth Cause of Action – Violations of Civil Code sections 895    et seq.

The Right to Repair Act encompasses Civil Code sections 895 et seq. and governs home building defects.  As a threshold matter, although it is not specifically alleged in the Complaint that the structure at issue is a residential home encompassed by the Right to Repair Act, or that Plaintiff is the “homeowner,” both parties’ briefing appears to presume that it is Plaintiff’s home.  Therefore, for purposes of the demurrer and motion to strike, the Court also presumes that the structure at issue is a residence and Plaintiff is the homeowner.

Civil Code section 897 provides:

To the extent not otherwise covered by these standards, manufactured products, including, but not limited to, windows, doors, roofs, plumbing products and fixtures, fireplaces, electrical fixtures, HVAC units, countertops, cabinets, paint, and appliances shall be installed so as not to interfere with the products’ useful life, if any.

[…]

(E) This title does not apply in any action seeking recovery solely for a defect in a manufactured product located within or adjacent to a structure.

(Civ. Code, § 897, subd. (g)(3)(A) & (E).)

            C Seed argues that as an alleged manufacturer, its liability is limited to instances where its negligent act or omission or breach of contract caused a violation of the building standards outlined in the Right to Repair Act, but would not cover defects solely to the television itself contained within or adjacent to a structure.

            Plaintiff argues that because the installation of the very large outdoor television at issue involved the use of cranes, Plaintiff alleges C Seed is both a manufacturer and a builder, for purposes of the Right to Repair Act.           The FAC alleges:

95. Civil Code section 895, et seq., applies to new residential construction built and sold subsequent to January 1, 2003, and sets forth construction standards for actions arising out of, or related to deficiencies in, the residential construction, design, specifications, surveying, planning, supervision, testing, or observation of construction and provides that a builder, general contractor, subcontractor, material supplier, individual product manufacturer, or design professional, shall be liable for violations of the standards expressly set forth in Title 7 of the California Civil Code.

96. Civil Code section 895, et seq., applies to the Property and the TV purchased by Plaintiff from C SEED because Plaintiff and C SEED signed the Contract for the installation of the TV newly constructed Property after January 1, 2003, as required by Civil Code section 938. Further, C SEED performed work at the Project, specifically C SEED designed and installed the TV at the Property. In fact, such installation of the TV required C SEED’s creation of shop drawings, the use of cranes, specifically brought out by C SEED for the installation of the TV, and the construction of the structure for the TV to be placed. A true and correct copy of the pictures taken during the installation of the TV are attached hereto as Exhibit D and are fully incorporated herein by reference.

97. Moreover, C SEED permanently constructed and attached to a customized retractable shaft, per drawings to be provided by C SEED. The construction portion done by C SEED included C SEED taking responsibility for permits in reference to products provided by C SEED.

98. Plaintiff represents it has fully complied with the pre-litigation requirements set forth in Civil Code section 895 et. seq. and C SEED received notices of the deficient TV supplied and installed by C SEED at the Property.

99. Plaintiff has also investigated and inspected the repairs performed by C SEED representatives during Civil Code section 895, et seq., pre-litigation repair process.

100. As revealed by the investigation and inspection, Plaintiff alleges that C SEED violated Civil Code section 895, et seq., by failing to design, install and construct the TV at the Property in accordance with the statutory standards for residential construction enumerated in Civil Code section 896 and encompassed by Civil Code section 897.

101. C SEED’s violations of Civil Code sections 896 and 897 have resulted in deficiencies at the Project, which have resulted in property damage to and loss of use of the Property, which damages will be continuing nuisances and health and safety risks until properly repaired/replaced.

102. For specific deficiencies in the installation of the TV at the Property, please refer to Paragraph 18 of this Complaint.

103. C SEED’s violations of Civil Code sections 896 and 897 have resulted in deficiencies which have resulted in property damage to and loss of use of the Property, which damages will be continuing nuisances and health and safety risks until properly repaired/replaced.

104. As a direct and proximate result of the above violations, Plaintiff has been damaged and will continue to be damaged because the TV at the Property fails to meet the applicable standards of construction as statutorily set forth in Civil Code sections 896 and 897; and, as a result, Plaintiff has incurred and will be forced to incur expenses to repair and replace materials that violate said construction standards, and is, therefore, entitled to damages in accordance with Civil Code section 944, which includes but is not limited to, the reasonable cost of repairing and rectifying violations, the reasonable cost of repairing any damages caused by repair efforts, reasonable relocation and storage expenses, lost business income, reasonable investigative costs for each established violation, and all other costs or fees recoverable by contract or statute, all far in excess of the minimum jurisdictional amount of this Court, according to proof at the time of trial.

(FAC ¶¶ 95-104.)

            Thus, regardless of whether C Seed is also a “builder” as that term is defined under the Act, Plaintiff has adequately alleged that C Seed, as the TV’s manufacturer, caused property damage to Plaintiff’s home as a result of its defective installation of “a customizable retractable shaft” that involved “creation of shop drawings, the use of cranes, specifically brought out by C SEED for the installation of the TV, and the construction of the structure for the TV to be placed” sufficient to state a cause of action.

            Defendant also argues that Plaintiff has not alleged it satisfied the pre-filing requirement.  The FAC alleges, “Plaintiff represents it has fully complied with the pre-litigation requirements set forth in Civil Code section 895 et. seq. and C SEED received notices of the deficient TV supplied and installed by C SEED at the Property.”  (FAC ¶ 98.)  This allegation suffices at this stage of the litigation.  Whether Plaintiff in fact satisfied the pre-filing requirements is a factual question to be determined at later stages of the litigation.

            Therefore, the Court overrules the demurrer to the eighth cause of action.

7.                 Ninth Cause of Action – Violations of Bus. & Prof. Code § 7031(b)

Business and Professions Code section 7031, subdivision (b) provides:

Except as provided in subdivision (e), a person who utilizes the services of an unlicensed contractor may bring an action in any court of competent jurisdiction in this state to recover all compensation paid to the unlicensed contractor for performance of any act or contract.

            Business and Professions Code section 7045 provides:

This chapter does not apply to the sale or installation of any finished products, materials, or articles of merchandise that do not become a fixed part of the structure, nor shall it apply to a material supplier or manufacturer furnishing finished products, materials, or articles of merchandise who does not install or contract for the installation of those items. The term “finished products” shall not include installed carpets or mobilehomes or mobilehome accessory structures, as defined in Section 7026.2.

This chapter shall apply to the installation of home improvement goods, as defined in Section 7151.

            Business and Professions Code section 7151, subdivision (c) provides:

For purposes of this chapter, “home improvement goods or services” means goods and services, as defined in Section 1689.5 of the Civil Code, which are bought in connection with the improvement of real property. Such home improvement goods and services include, but are not limited to, carpeting, texture coating, fencing, air conditioning or heating equipment, and termite extermination. Home improvement goods include goods which are to be so affixed to real property as to become a part of real property whether or not severable therefrom.

            C Seed argues that the installation or repair of ordinary equipment used in the home, such as televisions, radios, or phonographic equipment is not covered under the law.  However, the television at issue is “the world’s largest outdoor television” (FAC ¶ 7) costing $1,000,000 (FAC ¶ 111), the installation of which involved the “creation of shop drawings, the use of cranes, specifically brought out by C SEED for the installation of the TV, and the construction of the structure for the TV to be placed.”  (FAC ¶¶ 96, 108.) 

Thus, the television at issue is not alleged to be an ordinary electronic device, and, construing the allegations of the FAC in a light most favorable to Plaintiff, may constitute a permanent fixture to the home.

C Seed also argues that the claim for disgorgement under section 7031, subd. (b) is barred by a one-year statute of limitation, to which the discovery rule does not apply.  (See Eisenberg Vill. Of L.A. Jewish Home for the Aging v. Suffolk Constr. Co. (2020) 53 Cal.App.5th 1201, 1203.)  In opposition, Plaintiff argues that the statute of limitations was equitably tolled while the parties were in regular communications about ongoing repairs, until November 2023, when C Seed definitively indicated it would no longer repair or replace the defective television.  C Seed does not address Plaintiff’s equitable tolling argument on reply.

As such, the Court overrules C Seed’s demurrer to the ninth cause of action.

8.                 Tenth Cause of Action – Violations of Bus. & Prof. Code, § 17200

Business and Professions Code section 17200, known as the Unfair Competition Law, or “UCL,” bars unfair competition, defined as “any unlawful, unfair or fraudulent business act or practice and unfair, deceptive, untrue or misleading advertising and any act prohibited by Chapter 1 (commencing with Section 17500) of Part 3 of Division 7 of the Business and Professions Code.  “An ‘unlawful’ business practice or act within the meaning of the UCL is an act or practice, committed pursuant to business activity, that is at the same time forbidden by law.”  (Bernardo v. Planned Parenthood Federation of Am. (2004) 115 Cal.App.4th 322, 351.)  “By proscribing ‘any unlawful’ business practice, section 17200 borrows violations of other laws and treats them as unlawful practices that the unfair competition law makes independently actionable.”  (Cel-Tech Communications, Inc. v. Los Angeles Cellular Telephone Co. (1999) 20 Cal.4th 163, 180.)  Moreover, “a practice may be deemed unfair even if not specifically proscribed by some other law.”  (Ibid.)

            C Seed argues that the equitable remedies of restitution and injunctive relief available under the UCL are only appropriate where an adequate remedy does not exist in law, which Plaintiff does not allege.  However, C Seed only cites to federal cases, for which there are differing pleadings standards and criteria for dismissal at the pleadings stage.  C Seed does not cite to any binding California authority standing for the proposition that Plaintiff may not plead in the alternative both legal and equitable causes of action. 

            C Seed also argues, and the Court agrees, that to the extent Plaintiff’s UCL cause of action is predicated on fraudulent conduct, Plaintiff has failed to allege fraud with requisite particularity.  However, as discussed above, Plaintiff has adequately alleged other predicate statutory violations to constitute “unlawful” and/or “unfair” behavior.

            Therefore, the Court overrule C Seed’s demurrer to the tenth cause of action.

              II.          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, subd. (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”].) 

Moreover, “the 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].) 

            Here, C Seed moves to strike the following allegations:

·       15. As such, Plaintiff is entitled to the rights and protections afforded to consumers, including the rights and protections of the Song-Beverly Act set forth in California Civil Code Sections 1790 et seq. including sections 1793.02 and 1795.6.

·       51. C SEED failed to include the statutory and mandatory express warranty language as outlined in Cal. Civ. Code § 1793.02(a) which is as follows: “all new and used assistive devices sold at retail in this state shall be accompanied by the retail seller's written warranty which shall contain the following language: “This assistive device is warranted to be specifically fit for the particular needs of you, the buyer. If the device is not specifically fit for your particular needs, it may be returned to the seller within 30 days of the date of actual receipt by you or completion of fitting by the seller, whichever occurs later. If you return the device, the seller will either adjust or replace the device or promptly refund the total amount paid. This warranty does not affect the protections and remedies you have under other laws.” In lieu of the words “30 days” the retail seller may specify any longer period.” (emphasis added).

·       52. More importantly, the express warranty period, as provided by C SEED, is tolled; “(a)(1) Except as provided in paragraph (2) warranty1 period relating to an implied or express warranty accompanying a sale or consignment for sale of consumer goods selling for fifty dollars ($50) or more shall automatically be tolled for the period from the date upon which the buyer either (1) delivers nonconforming goods to the manufacturer or seller for warranty repairs or service or (2), pursuant to subdivision (c) of Section 1793.2 or Section 1793.22, notifies the manufacturer or seller of the nonconformity of the goods up to, and including, the date upon which (1) the repaired or serviced goods are delivered to the buyer, (2) the buyer is notified the goods are repaired or serviced and are available for the buyer's possession or (3) the buyer is notified that repairs or service is completed, if repairs or service is made at the buyer's residence. Cal. Civ. Code § 1795.6 (a)(1).As indicated above, there was a sale of goods, specifically a new and “revolutionary” product, in which Defendant C SEED was the seller of the TV to Plaintiff and Plaintiff was the buyer of the TV.

·       55. Despite such communications, C SEED continues to fail and refuse, to cure said issues, which is in direct violation, amongst other things, with Cal. Civ. Code § 1793.02(2)(A)(c), which provides as follows: “If the buyer returns the device within the period specified in the written warranty, the seller shall, without charge and within a reasonable time, adjust the device or, if appropriate, replace it with a device that is specifically fit for the particular needs of the buyer. If the seller does not adjust or replace the device so that it is specifically fit for the particular needs of the buyer, the seller shall promptly refund to the buyer the total amount paid, the transaction shall be deemed rescinded, and the seller shall promptly return to the buyer all payments and any assistive device or other consideration exchanged as part of the transaction and shall promptly cancel or cause to be canceled all contracts, instruments, and security agreements executed by the buyer in connection with the sale. When a sale is rescinded under this section, no charge, penalty, or other fee may be imposed in connection with the purchase, fitting, financing, or return of the device.”

·       66. The implied warranty period is tolled; “(a)(1) Except as provided in paragraph (2) warranty1 period relating to an implied or express warranty accompanying a sale or consignment for sale of consumer goods selling for fifty dollars ($50) or more shall automatically be tolled for the period from the date upon which the buyer either (1) delivers nonconforming goods to the manufacturer or seller for warranty repairs or service or (2), pursuant to subdivision (c) of Section 1793.2 or Section 1793.22, notifies the manufacturer or seller of the nonconformity of the goods up to, and including, the date upon which (1) the repaired or serviced goods are delivered to the buyer, (2) the buyer is notified the goods are repaired or serviced and are available for the buyer's possession or (3) the buyer is notified that repairs or service is completed, if repairs or service is made at the buyer's residence. Cal. Civ. Code § 1795.6 (a)(1).

·       70. Despite such communications, C SEED failed and refused, and continues to fail and refuse, to cure said issues, which is in direct violation, amongst other things, with Cal. Civ. Code § 1793.02(2)(A)(c), which provides as follows: “If the buyer returns the device within the period specified in the written warranty, the seller shall, without charge and within a reasonable time, adjust the device or, if appropriate, replace it with a device that is specifically fit for the particular needs of the buyer. If the seller does not adjust or replace the device so that it is specifically fit for the particular needs of the buyer, the seller shall promptly refund to the buyer the total amount paid, the transaction shall be deemed rescinded, and the seller shall promptly return to the buyer all payments and any assistive device or other consideration exchanged as part of the transaction and shall promptly cancel or cause to be canceled all contracts, instruments, and security agreements executed by the buyer in connection with the sale. When a sale is rescinded under this section, no charge, penalty, or other fee may be imposed in connection with the purchase, fitting, financing, or return of the device.”

·       75. Notwithstanding this representation, Defendants knew that its “new and innovative” TV was not yet ready to hit the market due to its numerous deficiencies and failure to properly perform, yet it sold the TV to Plaintiff.

·       81. As a direct and proximate result of Defendants’ fraud, Plaintiff has been damaged in an amount according to proof, which include, but are not limited to, the recovery of punitive damages against Defendants’

·       84. In fact, Defendants acted with the intent that Plaintiff would rely on its representatives and advertisements.

·       85. Notwithstanding this representation, Defendants knew that its “new and innovative” TV was not yet ready to hit the market due to its numerous deficiencies and failure to properly perform for others, yet it sold the TV to Plaintiff.

·       94. Plaintiff realleges and incorporates by reference each and every allegation set forth in this Complaint.

·       95. Civil Code section 895, et seq., applies to new residential construction built and sold subsequent to January 1, 2003, and sets forth construction standards for actions arising out of, or related to deficiencies in, the residential construction, design, specifications, surveying, planning, supervision, testing, or observation of construction and provides that a builder, general contractor, subcontractor, material supplier, individual product manufacturer, or design professional, shall be liable for violations of the standards expressly set forth in Title 7 of the California Civil Code.

·       96. Civil Code section 895, et seq., applies to the Property and the TV purchased by Plaintiff from C SEED because Plaintiff and C SEED signed the Contract for the installation of the TV newly constructed Property after January 1, 2003, as required by Civil Code section 938. Further, C SEED performed work at the Project, specifically C SEED designed and installed the TV at the Property. In fact, such installation of the TV required C SEED’s creation of shop drawings, the use of cranes, specifically brought out by C SEED for the installation of the TV, and the construction of the structure for the TV to be placed. A true and correct copy of the pictures taken during the installation of the TV are attached hereto as Exhibit D and are fully incorporated herein by reference.

·       97. Moreover, C SEED permanently constructed and attached to a customized retractable shaft, per drawings to be provided by C SEED. The construction portion done by C SEED included C SEED taking responsibility for permits in reference to products provided by C SEED.

·       98. Plaintiff represents it has fully complied with the pre-litigation requirements set forth in Civil Code section 895 et. seq. and C SEED received notices of the deficient TV supplied and installed by C SEED at the Property.

·       99. Plaintiff has also investigated and inspected the repairs performed by C SEED representatives during Civil Code section 895, et seq., pre-litigation repair process.

·       100. As revealed by the investigation and inspection, Plaintiff alleges that C SEED violated Civil Code section 895, et seq., by failing to design, install and construct the TV at the Property in accordance with the statutory standards for residential construction enumerated in Civil Code section 896 and encompassed by Civil Code section 897.

·       101. C SEED’s violations of Civil Code sections 896 and 897 have resulted in deficiencies at the Project, which have resulted in property damage to and loss of use of the Property, which damages will be continuing nuisances and health and safety risks until properly repaired/replaced.

·       102. For specific deficiencies in the installation of the TV at the Property, please refer to Paragraph 18 of this Complaint.

·       103. C SEED’s violations of Civil Code sections 896 and 897 have resulted in deficiencies which have resulted in property damage to and loss of use of the Property, which damages will be continuing nuisances and health and safety risks until properly repaired/replaced.

·       104. As a direct and proximate result of the above violations, Plaintiff has been damaged and will continue to be damaged because the TV at the Property fails to meet the applicable standards of construction as statutorily set forth in Civil Code sections 896 and 897; and, as a result, Plaintiff has incurred and will be forced to incur expenses to repair and replace materials that violate said construction standards, and is, therefore, entitled to damages in accordance with Civil Code section 944, which includes but is not limited to, the reasonable cost of repairing and rectifying violations, the reasonable cost of repairing any damages caused by repair efforts, reasonable relocation and storage expenses, lost business income, reasonable investigative costs for each established violation, and all other costs or fees recoverable by contract or statute, all far in excess of the minimum jurisdictional amount of this Court, according to proof at the time of trial.

·       105. Plaintiff realleges and incorporates by reference each and every allegation set forth in this Complaint.

·       106. Plaintiff is informed and believes that C SEED is an unlicensed contractor in California.

·       107. As such, a person who utilizes the services of an unlicensed contractor may bring an action in any court of competent jurisdiction in this state to recover all compensation paid to the unlicensed contractor for performance of any act or contract. Cal. Bus. & Prof. Code § 7031(b).

·       108. C SEED was hired under the Contract by Plaintiff to provide and install the TV at the Property. In fact, such installation of the TV required the use of cranes, specifically brought out by C SEED for the installation of the TV and the construction of the structure for the TV to be placed..

·       109. Moreover, C SEED permanently constructed and attached to a customized retractable shaft, per drawings to be provided by C SEED. The construction portion done by C SEED included C SEED taking responsibility for permits in reference to products provided by C SEED. Therefore, a valid California contractor’s license was required by C SEED to install or contract for the installation of the TV at the Project.

·       110. As such, on or around February 2021, C SEED installed the TV at the Property. However, C SEED was not licensed as a contractor in California to perform such installation at the Property. Further, as alleged above, C SEED is estopped from asserting any statute of limitations as alleged above as a defense to this claim

·       111. Thus, Plaintiff therefore demands disgorgement and restitution in an amount no less than $1,000,000.00 and judgment in an amount to be determined at trial, together with interest, attorneys’ fees, and costs of this action.

·       115. Plaintiff seeks to enjoin C SEED from engaging in these fraudulent, unfair ,and unlawful business practices. As a proximate result of the unlawful, unfair, and fraudulent business acts and practices alleged herein, Plaintiff paid in excess of $1,000,000.00 to C SEED. Plaintiff demands restitution of all amounts paid to C SEED, seeks to enjoin C SEED from further unlawful conduct, and seeks punitive damages.

·       Prayer, p. 20, l. 3; Prayer, p. 20, l. 18; Prayer, p. 20, l. 22 Prayer, p. 21, l. 8.

To the extent C Seed seeks to strike factual allegations as “irrelevant, false, or improper,” C Seed’s motion is denied.  Just because allegations may not rise to the level of specificity required to allege a cause of action for fraud does not mean the allegations do not support other causes of action or are otherwise made irrelevant or improper. 

The Court is unable to discern exactly what Plaintiff seeks to strike by “Prayer, p. 20, l. 3; Prayer, p. 20, l. 18; Prayer, p. 20, l. 22 Prayer, p. 21, l. 8” however the Court does note that Prayer paragraphs 9, 12, and 21 seek punitive damages, which the motion seeks to strike. 

As discussed above, Plaintiff has failed to allege fraudulent conduct with requisite specificity to withstand demurrer or to support punitive damages based in fraud.  Further, Plaintiff has not alleged oppression or malice with requisite specificity, much less on the part of C Seed’s managing agents sufficient to support a claim for punitive damages.  As such, the Court strikes “punitive damages” from paragraphs 81, 115, and prayer paragraphs 9, 12, and 21. 

To the extent C Seed seeks to strike requests for restitution or injunctive relief, the Court denies that request for the same reasons it overrules the demurrer to such causes of action.  Therefore, C Seed’s motion to strike is denied in all other respects.

           III.          LEAVE TO AMEND

A plaintiff has the burden of showing in what manner the 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].)

Here, Plaintiff has failed to meet its burden as it does not specify what facts could be added to the complaint to address the deficiencies identified by the court.  Therefore, leave to amend is denied.

CONCLUSION AND ORDER

For the reasons stated, the Court sustains without leave to amend C Seed’s demurrer to the second, fifth, sixth, and seventh causes of action, but overrules C Seed’s demurrer to the third, fourth, eighth, ninth, and tenth causes of action. 

Further, the Court grants in part and denies in part C Seed’s motion to strike.  The Court strikes the phrase “punitive damages” from paragraphs 81, 115 and prayer paragraphs 9, 12, and 21 without leave to amend.  C Seed’s motion to strike is denied in all other respects.

The Court orders C Seed to file an Answer to the FAC on or before November 15, 2024. 

C Seed shall provide notice of the Court’s ruling and file the notice with a proof of service forthwith. 

DATED:  October 24, 2024                                                   ___________________________

                                                                                          Michael E. Whitaker

                                                                                          Judge of the Superior Court