Judge: Michael P. Linfield, Case: 23STCV10850, Date: 2024-02-06 Tentative Ruling

Case Number: 23STCV10850    Hearing Date: February 6, 2024    Dept: 34

SUBJECT:        Motion for Judgment on the Pleadings

Moving Party: Defendants Ben-O, Inc., John Y. Oh, and Vicky Oh

Resp. Party:    Plaintiff Samuel Lee

The Motion for Judgment on the Pleadings is DENIED. 

BACKGROUND:

On May 15, 2023, Plaintiff Samuel Lee filed his Complaint against Defendants Ben-O Inc., Jung Hoon Oh, and Vicky Oh on causes of action arising from his employment.

On June 7, 2023, Plaintiff amended his Complaint to correct the name of Defendant John Y. Oh, who was erroneously sued as Jung Hoon Oh.

On August 14, 2023, Defendants filed their Answer to the Complaint.

On December 22, 2023, Defendants filed their Motion for Judgment on the Pleadings. Defendants concurrently filed Declaration of Haewon Kim.

On January 19, 2024, Plaintiff filed his Opposition.

On January 25, 2024, Defendants filed their Reply.

ANALYSIS:

I.          Legal Standard

“A party may move for judgment on the pleadings.” (Code Civ. Proc., § 438, subd. (b)(1).)

The motion provided for in this section may only be made on one of the following grounds: . . . (B) If the moving party is a defendant, that either of the following conditions exist: (i) The court has no jurisdiction of the subject of the cause of action alleged in the complaint. (ii) The complaint does not state facts sufficient to constitute a cause of action against that defendant.” (Code Civ. Proc., § 438, subd. (c)(1)(B).)

“A motion for judgment on the pleadings performs the same function as a general demurrer, and hence attacks only defects disclosed on the face of the pleadings or by matters that can be judicially noticed.” (Cloud v. Northrop Grumman Corp. (1998) 67 Cal.App.4th 995, 999, citations omitted.)

“In deciding or reviewing a judgment on the pleadings, all properly pleaded material facts are deemed to be true, as well as all facts that may be implied or inferred from those expressly alleged.” (Fire Ins. Exch. v. Super. Ct. (2004) 116 Cal.App.4th 446, 452.)

II.       Discussion

Defendants move for judgment on the pleadings as to Plaintiff’s sixth cause of action for conversion, arguing: (1) that California courts continue to recognize common law motions for judgment on the pleadings that can be made up through trial; and (2) that the sixth cause of action does not state a claim for conversion because Plaintiff did not have a right of possession to pooled tips. (Motion, p. 2:1–2, 3:4–5.)

Defendants are correct that they may file a common law motion for judgment on the pleadings at this time.

However, Defendants are wrong on the law.

“Conversion is the wrongful exercise of dominion over the property of another. The elements of a conversion claim are: (1) the plaintiff’s ownership or right to possession of the property; (2) the defendant’s conversion by a wrongful act or disposition of property rights; and (3) damages.” (Lee v. Hanley (2015) 61 Cal.4th 1225, 1240.)

“It is not necessary that there be a manual taking of the property; it is only necessary to show an assumption of control or ownership over the property, or that the alleged converter has applied the property to his own use. Money can be the subject of an action for conversion if a specific sum capable of identification is involved. Neither legal title nor absolute ownership of the property is necessary. A party need only allege it is entitled to immediate possession at the time of conversion. However, a mere contractual right of payment, without more, will not suffice.” (Farmers Ins. Exch. v. Zerin (1997) 53 Cal.App.4th 445, 451–52 [cleaned up].)

        “No employer or agent shall collect, take, or receive any gratuity or a part thereof that is paid, given to, or left for an employee by a patron, or deduct any amount from wages due an employee on account of a gratuity, or require an employee to credit the amount, or any part thereof, of a gratuity against and as a part of the wages due the employee from the employer. Every gratuity is hereby declared to be the sole property of the employee or employees to whom it was paid, given, or left for. An employer that permits patrons to pay gratuities by credit card shall pay the employees the full amount of the gratuity that the patron indicated on the credit card slip, without any deductions for any credit card payment processing fees or costs that may be charged to the employer by the credit card company. Payment of gratuities made by patrons using credit cards shall be made to the employees not later than the next regular payday following the date the patron authorized the credit card payment.” (Lab. Code, § 351.)

Among other things, Plaintiff alleges: (1) that Plaintiff was employed as a sushi chef by Defendant Ben-O, Inc.; (2) that while employed in this position, Plaintiff participated in tip pooling; (3) that Defendant John Y. Oh (the owner of Defendant Ben-O, Inc.) distributed a portion of pooled tips to Defendant Vicky Oh, but that these tips were designated as being for an individual (the son of Defendants John Y. Oh and Vicky Oh) who did not work in the restaurant; (4) that Plaintiff did not consent to this diversion of the tips to a non-employee; and (5) that Plaintiff was harmed by this diversion of tips. (Complaint, ¶¶ 11, 21, 47–49.)

        The pleading sufficiently alleges that Plaintiff did have a right to possession of his share of the pooled tips. Whether Defendants actually diverted part of that share to a non-employee, which in turn caused a conversion of a portion of Plaintiff’s property, is a question of fact that is not properly determined on a demurrer.

        Defendants point to Leighton v. Old Heidelberg, Ltd. (1990) 219 Cal.App.3d 1062 and Avidor v. Sutter’s Place, Inc. (2013) 212 Cal.App.4th 1439 in support of their arguments. In Leighton, the Court of Appeal held that employer-mandated tip pool that ensures equitable sharing of gratuities among employees does not violate Labor Code section 351. (Leighton, supra, at p. 1071.) In Avidor, the Court of Appeal held, among other things, that an employer-mandated tip pool that required a portion of gratuities to be shared with other employees did not violate Labor Code section 351 and was not conversion. (Avidor, supra, at pp. 1450–1453.)

Both of these cases are inapposite to the situation at hand. Here, Plaintiff has alleged that Defendants are diverting a portion of the tip pool to a non-employee. That is different from the situations cited by Defendants.

III.     Conclusion

The Motion for Judgment on the Pleadings is DENIED.