Judge: Monica Bachner, Case: 21STCV45765, Date: 2023-01-05 Tentative Ruling
Case Number: 21STCV45765 Hearing Date: January 5, 2023 Dept: 71
Superior Court of California
County of Los Angeles
DEPARTMENT 71
TENTATIVE RULING
|
DONALD TRAN,
vs.
TOYOTA TSUSHO SYSTEMS, et al. |
Case No.: 21STCV45765
Hearing Date: January 5, 2023 |
Defendants Toyota Tsusho Systems US, Inc.’s demurrer to the complaint of Plaintiff Donald Tran is sustained as to the 1st, 2nd, 3rd, 4th, 5th, and 6th, causes of action with 15 days leave to amend and sustained as to the 7th cause of action without leave to amend. Rajat Sahi’s demurrer is sustained as to the 1st, 2nd, 3rd, 4th, 5th, 6th, and 7th causes of action without leave to amend.
Defendant Xoriant Corporation’s demurrer to the complaint of Plaintiff is sustained as to the 1st, 2nd, 3rd, 4th, 5th, and 6th, causes of action with 10 days leave to amend and sustained as to the 7th cause of action without leave to amend.
Defendants Toyota Tsusho Systems US, Inc.’s and Rajat Sahi’s motion to strike is denied as moot.
Defendants Toyota Tsusho Systems US, Inc. (“TTS”) (“Defendant”), erroneously sued as Toyota Tsusho Systems, and Rajat Sahi’s (“Sahi”) (“Defendant”) demur to the 1st (breach of contract), 2nd (wrongful termination), 3rd (intentional infliction of emotional distress [“IIED”]), 4th (failure to provide accurate itemized wage statements in violation of California Labor Code §226), 5th (waiting time penalties pursuant to California Labor Code §§201, 202, and 203), 6th (unfair competition in violation of California Business & Professional Code §17200, et seq.), and 7th (civil penalties under the Private Attorneys General Act [“PAGA”]) causes of action in the complaint of Plaintiff Donald Tran (“Tran”) (“Plaintiff”). Defendants demur on the grounds that the first through seventh causes of action fail to allege sufficient facts to constitute the causes of action and are uncertain. (TTS Demurrer, pgs. 2-6; C.C.P. §§430.10(e), (f).)
Defendants TTS and Sahi move to strike ¶9; the 5th, 6th, and 7th causes of action; and request for attorneys’ fees in Plaintiff’s Complaint on the grounds the allegations are improper and unsupported by an otherwise sufficient claim and are not drawn or filed in conformity with the laws of this state, a court rule, or an order of the court, and therefore should be stricken. (Notice of MTS, pg. 2; C.C.P. §§435, 436.)
Defendant Xoriant Corporation (“Xoriant”) (“Defendant”) demurs to Plaintiff’s 1st, 2nd, 3rd, 4th, 5th, 6th, and 7th causes of action. Defendant demurs on the grounds that the first through seventh causes of action fail to allege sufficient facts to constitute the causes of action and are uncertain. (Xoriant Demurrer, pgs. 2-6; C.C.P. §§430.10(e), (f).)
Requests for Judicial Notice
Defendants Toyota Tsusho Systems US, Inc.’s and Rajat Sahi’s 12/23/2022 Request for Judicial Notice of the 6/13/22 Minute Entry, 10/5/22 Minute Entry, 10/13/22 Minute Entry, and 10/26/22 Minute Entry is denied, as there is no need to take judicial notice since the Court can review the records of the case at hand.
Defendant Xoriant Corporation’s 8/24/2022 Request for Judicial Notice as to a screenshot of the Department of Industrial Relations website, as of August 22, 2022 (Exh. A); case search results submitted to the California Labor and Workforce Development Agency (“LWDA”) as of August 18, 2022, for Case No.
“21STCV45765” (Exh. B); and case search results submitted to the LWDA for “Donald Tran” (Exh. C) are denied.
Procedural Background
On December 15, 2021, Plaintiff filed his complaint against Defendants TTS, Xoriant, Advanced Reporting, LLC,[1] Takashi Nishizaki (“Nishizaki”), Erin Mount (“Mount”), Sahi, David Odierno (“Odierno”), Myles Hagi (“Hagi”), Toyota Motor Group Corp. (“Toyota Motor Group”), Toyota Industries Corporation (“Toyota Industries”), and Denso Corp. (“Denso”) (collectively, Defendants) for seven causes of action: (1) breach of contract; (2) wrongful termination; (3) IIED; (4) failure to provide accurate itemized wage statements in violation of California Labor Code §226; (5) waiting time penalties pursuant to California Labor Code §§201, 202, and 203; (6) unfair competition in violation of California Business & Professional Code §17200, et seq.; and (7) civil penalties under PAGA. On May 5, 2022, Defendants TTS and Sahi filed the instant demurrer and accompanying motion to strike. On July 25, 2022, Defendant Xoriant filed a declaration in support of an automatic extension because Defendant has not been able to meet and confer with Plaintiff because Plaintiff was unresponsive to Defendant Xoriant’s multiple attempts to contact him. On August 24, 2022, Defendant Xoriant filed the instant demurrer. Plaintiff filed his opposition to the two demurrers on December 16, 2022. On December 23, 2022, Defendants TTS and Sahi and Defendant Xoriant filed their replies.
Defendants Toyota Tsusho Systems US, Inc.’s and Rajat Sahi’s Demurrer and Defendant Xoriant’s Demurrer
Summary of Demurrers
In support of its demurrer to Plaintiff’s first, second, third, fourth, fifth, sixth, and seventh causes of action, Defendants TSS and Sahi argue Plaintiff’s claims fail to state facts sufficient to constitute causes of action and are uncertain. (TTS Demurrer Memorandum, pgs. 7-18.)
In support of its demurrer to Plaintiff’s first, second, third, fourth, fifth, sixth, and seventh causes of action, Defendant Xoriant argues Plaintiff’s claims fail to state facts sufficient to constitute causes of action. (Xoriant Demurrer Memorandum, pgs. 9-17.)
Meet and Confer
Before filing a demurrer, the moving party shall meet and confer in person or by telephone with the party who has filed the pleading subject to the motion to strike and file a declaration detailing their meet and confer efforts. (C.C.P. §430.41.)
Defendants TTS and Sahi declare they attempted to contact Plaintiff regarding their intentions to file demurrers, but Plaintiff does not list a telephone number or email address in his Complaint, and instead sent letters to Plaintiff via first class mail to attempt to meet and confer. (Decl. of Miller ¶4, Exh. D.) Defendants TTS and Sahi declare they did not receive a response to their letters and sent follow-up correspondence to Plaintiff via FedEx. (Decl. of Miller ¶5, Exh. E.)
Defendant Xoriant declares it attempted to contact Plaintiff via email regarding its intentions to file a demurrer. (Decl. of Fronjian ¶4, Exh. B.) Defendant Xoriant declares it sent follow-up correspondence to Plaintiff via that was not answered by Plaintiff. (Decl. of Fronjian ¶5, Exh. C.)
While parties failed to meet and confer, failure to meet and confer is not grounds to overrule or sustain a demurrer. (C.C.P. §430.41(4).) Accordingly, the Court will still consider Defendants’ demurrer.
Failure to State a Claim
Breach of Contract (1st COA)
To state a cause of action for breach of contract, Plaintiff must be able to establish “(1) the existence of the contract, (2) plaintiff’s performance or excuse for nonperformance, (3) defendant’s breach, and (4) the resulting damages to the plaintiff.” (Oasis West Realty, LLC v. Goldman (2011) 51 Cal.4th 811, 821.)
Plaintiff alleges Defendant’s [sic] entered into an oral contract with Plaintiff at various IT RISK maintenance work, and Plaintiff worked for Defendant TTS. (Complaint ¶2.) Plaintiff alleges he complied with all of his obligations under the contract, and “the perquisite was the Price Waterhouse Cooper Audit Report (The Report) in which TFS failed on a massive scale internationally. (Complaint ¶3.) Plaintiff alleges “massive amounts of GAPs were discovered and identified (The Report) that needed to be remediated prior to submission to the SEC,” and “[t]his was an official Audit report that would be submitted to the SEC for TFS to be in SEC Regulatory Compliance with SOX 404 (Sarbanese [sic] Oxley 404) aka SOX.” (Complaint ¶3.) Plaintiff alleges he has been deprived of the benefits of his agreement with Defendant. (Complaint ¶4.) Plaintiff alleges Defendant’s [sic] breached the contract by taking actions to deprive Plaintiff of the benefit of the contract and by refusing to pay the amount that the defendants agreed to pay the plaintiff set forth in his employment contract. (Complaint ¶5.)
Plaintiff’s cause of action fails to allege any of the four elements required for a cause of action for breach of contract. Plaintiff fails to identify the contract it refers to, the terms of the contract, Plaintiff’s “obligations” under the contract. (Complaint ¶3.) Plaintiff fails to identify which of the named Defendants entered into the contract with Plaintiff. (Complaint ¶2.) Plaintiff fails to allege how Defendant Sahi, and individual Defendant, is related to this cause of action.
In his opposition, Plaintiff states he filed his complaint in pro per. (Opposition, pg. 2.) Plaintiff requests the Court grant him leave to amend his complaint to allege an employment contract between Plaintiff and Defendants TTS and/or Xoriant, and the details of his arrangements of his employment contract that Plaintiff alleges was breached when Plaintiff was terminated. (Opposition, pg. 2.) Accordingly, Defendant TTS’s demurrer and Defendant Xoriant’s demurrer to the 1st cause of action is sustained with 15 days leave to amend, and Defendant Sahi’s demurrer is sustained without leave to amend.
Wrongful Termination (2nd COA)
“The elements of a claim for wrongful discharge in violation of public policy are (1) an employer-employee relationship, (2) the employer terminated the plaintiff’s employment, (3) the termination was substantially motivated by a violation of public policy, and (4) the discharge caused the plaintiff harm. It is well established that a termination premised on an employee’s refusal to violate either a statute or an administrative regulation may support a claim for wrongful termination in violation of public policy.” (Nosal-Tabor v. Sharp Chula Vista Medical Center (2015) 239 Cal.App.4th 1224, 1234, citation omitted.)
Plaintiff alleges Defendants threatened, harassed, and discriminated against Plaintiffs [sic] in the terms and conditions of their employment, and ultimately terminated their employment, directly or constructively. (Complaint ¶7.) Plaintiff alleges the conduct was in violation of Government Code §1102.5 and was taken to punish Plaintiff for his opposition to Defendants’ illegal practices. (Complaint ¶8.) Plaintiff alleges as a direct and proximate cause of Defendant’s wrongful conduct, Plaintiff has suffered damages, including loss of salary, stock options, and other valuable employee benefits. (Complaint ¶9.)
Plaintiff’s cause of action fails to allege sufficient facts to assert a wrongful termination cause of action. Plaintiff makes conclusory statements regarding Defendants’ “illegal practices” and that Defendants “threatened, harassed, and discriminated against Plaintiffs [sic] in the terms and conditions of their employment.” (Complaint¶¶7, 8.) Plaintiff fails to allege an employer-employee relationship with a named Defendant, and which Defendants engaged in “illegal practices.” (Miklosy v. Regents of University of California (2009) 44 Cal.4th 876, 898.) Plaintiff fails to allege whether he was constructively discharged, and that the employer “either intentionally created or knowingly permitted working conditions that were so intolerable or aggravated at the time of the employee’s resignation that a reasonable employer would realize that a reasonable person in the employee’s position would be compelled to resign.” (Garamendi v. Golden Eagle Insurance (2005) 128 Cal.App.4th 452, 472, quoting Turner v. Anheuser-Busch, Inc. (1994) 7 Cal.4th 1238, 1251.)
Plaintiff fails to allege how Defendant Sahi, an individual Defendant, is related to this cause of action. In Tameny v. Atlantic Richfield Co. (1980) 27 Cal.3d 167, the California Supreme Court stated, “when an employer’s discharge of an employee violates fundamental principles of public policy, the discharged employee may maintain a tort action and recover damages traditionally available in such actions.” (Tameny v. Atlantic Richfield Co. (1980) 27 Cal.3d 167, 170.) A common law Tameny cause of action for wrongful termination, or a claim of retaliation, lies only against the employer, not against the supervisor through whom the employer commits the tort. (Miklosy, 44 Cal.4th at pgs. 900-901.) Because Plaintiff does not allege Sahi is an employer or any of Sahi’s conduct, Plaintiff fails to allege how Sahi relates to the cause of action.
Plaintiff requests the Court grant him leave to amend his complaint to allege his employment was terminated in violation of public policy by Defendants TTS and/or Xoriant in a whistleblower and/or retaliation claim. (Opposition, pg. 2.) Defendant TTS’s demurrer and Defendant Xoriant’s demurrer to the 2nd cause of action are sustained with 15 days leave to amend, and Defendant Sahi’s demurrer is sustained without leave to amend.
IIED (3rd COA)
“The elements of a prima facie case for the tort of intentional infliction of emotional distress are: (1) extreme and outrageous conduct by the defendant with the intention of causing, or reckless disregard of the probability of causing, emotional distress; (2) the plaintiff’s suffering severe or extreme emotional distress; and (3) actual and proximate causation of the emotional distress by the defendant’s outrageous conduct. Conduct to be outrageous must be so extreme as to exceed all bounds of that usually tolerated in a civilized community.” (Wilson v. Hynek (2012) 207 Cal.App.4th 999, 1009, citation and ellipses omitted.)
Plaintiff alleges all named defendants intentionally inflicted distress on Plaintiff through their conduct, including by intentionally lying to Plaintiff to cause him financial damages for their own financial gains. (Complaint ¶11.) Plaintiff alleges Defendants’ conduct was outrageous, intended to cause Plaintiff emotional distress, or acted with reckless disregard of the probability that Plaintiff would suffer emotional distress, and Plaintiff suffered emotional distress and Defendants’ conduct was a substantial factor in causing Plaintiff’s severe emotional distress. (Complaint ¶11(1)-(3).) Plaintiff alleges Defendants acted with malice, oppression, or fraud. (Complaint ¶12.)
Plaintiff fails to allege sufficient facts to state a claim for IIED. Plaintiff makes conclusory assertions that Defendants engaged in “outrageous conduct” that caused Plaintiff emotional distress. (Complaint ¶11.) Further, Plaintiff’s allegation related to financial damage must meet the standard of conduct “so outrageous in character, and so extreme in degree, as to go beyond all possible bounds of decency, and to be regarded as atrocious, and utterly intolerable in a civilized community.” (Cochran v. Cochran (1998) 65 Cal.App.4th 488, 496.) “An assertion of legal rights in pursuit of one’s own economic interests does not qualify as ‘outrageous’” for purposes of a claim of intentional infliction of emotional distress. (Yu v. Signet Bank/Virginia (1999) 69 Cal.App.4th 1377, 1397, citing Trerice v. Blue Cross of California (1989) 209 Cal.App.3d 878, 883; Kruse v. Bank of America (1988) 202 Cal.App.3d 38, 67.) Plaintiff fails to allege how Defendant Sahi relates to the cause of action.
Plaintiff requests the Court grant him leave to amend his complaint to allege outrageous conduct in connection with the wrongful termination of his employment based on the same whistleblower and/or retaliation claim. (Opposition, pgs. 2-3.) Defendant TTS’s demurrer and Defendant Xoriant’s demurrer to the 3rd cause of action are sustained with 15 days leave to amend, and Defendant Sahi’s demurrer is sustained without leave to amend.
Failure to Provide Accurate Itemized Wage Statements in Violation of Lab. Code §226 & Waiting Time Penalties in Violation of Lab. Code §§201, 202, and 203 (4th & 5th COAs)
Labor Code §226(a) provides that an employer must keep and provide accurate itemized statements of wages to its employees. (Lab. Code §226(a); Luben v. The Wackenhut Corp. (2016) 5 Cal.App.5th 926, 932.)
To establish a claim for nonpayment of wages under Labor Code §§201 and 202, the following elements are required: (1) plaintiff performed work for a defendant; (2) the defendant owes plaintiff wages under the terms of the employment; and (3) the amount of unpaid wages. (See CACI 2700.)
To recover a waiting-time penalty for nonpayment of wages under Labor Code §203, the following elements are required: (1) plaintiff’s employment with an employer ended; (2) the employer willfully failed to pay plaintiff all wages when due; (3) plaintiff’s daily wage rate at the time their employment ended; and (4) the date on which the employer never paid plaintiff all wages. (See CACI 2704.)
Plaintiff alleges “Defendants have knowingly and intentionally failed to comply with Labor Code §226(a) on each and every wage statement that should have been provided to the Plaintiff.” (Complaint ¶15.) Plaintiff alleges Defendant’s failure to pay Plaintiff all wages owing was willful. (Complaint ¶19.) Plaintiff alleges he no longer works for Defendants and therefore is entitled to penalties against Defendants. (Complaint ¶20.)
Plaintiff fails to allege sufficient facts to state the causes of action. Plaintiff does not allege which of the Defendants is an employer under the statutes and violated §§226(a), 201, and 202. Plaintiff fails to allege which of the nine categories of information is lacking or inaccurate in violation of §226. (Lab. Code §226(a).) Plaintiff fails to allege any injury caused to him by the violation of §226. (See Maldonado v. Epsilon Plastics, Inc. (2018) 22 Cal.App.5th 1308, 1334 [“inaccurate wage statements alone do not justify penalties; the plaintiffs must establish injury flowing from the inaccuracy”].) Plaintiff fails to allege how Defendants’ failure to pay Plaintiff all wages owing was willful. Plaintiff fails to allege his daily wage rate at the time his employment ended. Plaintiff fails to allege the amount of unpaid wages. Plaintiff fails to allege the date on which the employer failed to pay Plaintiff all wages. Plaintiff fails to allege how Defendant Sahi is related to the cause of action.
Plaintiff requests the Court grant him leave to amend his complaint to allege he was not provided with compliant wage and hour statements, was not paid for all hours worked, was not paid overtime, was not timely provided with his final paycheck, and was not given compliant rest breaks and meal breaks in violation of Labor Code §§201, 202, 203, and 226 et seq. (Opposition, pg. 3.) Defendant TTS’s demurrer and Defendant Xoriant’s demurrer to the 4th and 5th causes of action are sustained with 15 days leave to amend, and Defendant Sahi’s demurrer is sustained without leave to amend.
Unfair Competition in Violation of Bus. & Prof. Code §17200, et seq. (6th COA)
To set forth a claim for a violation of Business and Professions Code §17200 (“UCL”), Plaintiff must establish Defendant was engaged in an “unlawful, unfair or fraudulent business act or practice and unfair, deceptive, untrue or misleading advertising” and certain specific acts. (Bus. & Prof. Code §17200.) A cause of action for unfair competition “is not an all-purpose substitute for a tort or contract action.” (Cortez v. Purolator Air Filtration Products Co. (2000) 23 Cal.4th 163, 173.)
Plaintiff alleges “Defendants, [sic] willful misclassification scheme, through which they denied mandated meal and rest periods, premium wages for missed meal and rest periods, and legally mandated hourly wages for all hours worked, and are subjected to improper deductions to wages not authorized by law, has been, and continues to be, unfair, unlawful, and harmful to the Plaintiff, and the general public.” (Complaint ¶22.) Plaintiff alleges Defendants’ activities are violations of California law and constitute unlawful business acts and practices in violation of Business and Professions Code §17200 et seq. (Complaint ¶23.) Plaintiff alleges Defendants’ misclassification scheme allowed Defendants to strip Plaintiff of his “fundamental employment rights, such as the rights to correct hourly wage agreed upon when contracted for the job, mandated meal and rest periods, premium wages for missed meal and rest periods, itemized wage statements, and the prompt payment of full wages within the time limits set by law, as provided under various provisions of the Labor Code and Wage Order 9-2001.” (Complaint ¶24.) Plaintiff alleges Defendants willfully deprive Plaintiff of the protections afforded to him under California Workers Compensation laws. (Complaint ¶24.) Plaintiff alleges Defendants’ “unlawful scheme” made them able to “keep and appropriate for themselves significant amounts of money that otherwise should have been paid to Plaintiff as wages” and were able to illegally pass on business operational costs like use of their tablet computers, administrative fees, and the costs of workers compensation/occupational accident insurance to their employees in violation of Labor Code §2802. (Complaint ¶25.) Plaintiff alleges Defendants violate Labor Code §20804 by requiring Plaintiff to waive the benefits of the statute. (Complaint ¶25.)
Plaintiff fails to state a claim for a cause of action. Plaintiff’s Complaint fails to set forth facts demonstrating the asserted Labor Code violations under his UCL cause of action. (Aleksick v. 7-Eleven, Inc. (2012) 205 Cal.App.4th 1176, 1185 [“When a statutory claim fails, a derivative UCL claim also fails.”].) Plaintiff fails to allege an employment relationship with a named Defendant. Plaintiff does not provide facts to support his alleged general claims that he was denied meal and rest periods, not paid meal and rest period premiums, not paid for all hours worked for, paid at the wrong rate, subject to improper deductions, or deprived of protections afforded to him under California’s Workers Compensation laws. Plaintiff fails to allege Defendant Sahi’s relationship to the cause of action.
Plaintiff requests the Court grant him leave to amend his complaint to allege the violations under the Labor Code were also violations under Business and Professions Code §17200. (Opposition, pg. 3.) Defendant TTS’s demurrer and Defendant Xoriant’s demurrer to the 6th cause of action is sustained with 15 days leave to amend, and Defendant Sahi’s demurrer is sustained without leave to amend.
Civil Penalties under PAGA (7th COA)
The LWDA is authorized to assess and collect civil penalties for certain violations of the Labor Code. Because the LWDA and its constituent departments and divisions are unable to prosecute employers for every Labor Code violation, the Legislature enacted PAGA, which allows employees to initiate a civil action against their employers. (See Labor Code §2698; Iskanian v. CLS Transp. Los Angeles, LLC (2014) 59 Cal.4th 348, 379; Franco v. Athens Disposal Co., Inc. (2009) 171 Cal.App.4th 1277, 1301.) The aggrieved employee generally retains only 25% of any civil penalty recovery. The remaining 75% goes to the LWDA for education and enforcement purposes. (Labor Code §2699(i); see Caliber Bodyworks, Inc. v. Superior Court (2005) 134 Cal.App.4th 365, 370.)
“Aggrieved employee” means anyone who was employed by the alleged violator and against whom one or more of the alleged violations was committed. (Labor Code §2699(c); see Amalgamated Transit Union, Local 1756, AFL-CIO v. Superior Court (2009) 46 Cal.4th 993, 1004-1005.) PAGA does not limit the employee’s right to pursue other remedies available under state or federal law “either separately or concurrently with an action taken under this part.” (Labor Code §2699(g)(1); Caliber Bodyworks, Inc. v. Superior Court (2005) 134 Cal.App.4th 365, 375.)
Plaintiff alleges Defendants willfully misclassified Plaintiff as an independent contractor and engaged in a pattern or practice of committing said unlawful acts, failed to provide required meal periods to Plaintiff, failed to pay Plaintiff the additional hour of compensation earned for every shift that a mandated meal period was denied, failed to pay wages promptly following termination of employment, or when due and payable, and failed to maintain and provide to Plaintiff accurate itemized wage statements. (Complaint ¶27.)[2]
Plaintiff fails to state a claim for a cause of action. Plaintiff fails to allege he exhausted the administrative requirements under the statute. (Lab. Code §2699.3.)
In addition, Plaintiff fails to allege facts that connect Defendant Sahi to the cause of action. Plaintiff fails to allege facts that he was misclassified as an independent contractor. Plaintiff fails to allege facts that support that Defendants failed to provide Plaintiff with meal periods, failed to pay meal period premiums, failed to pay wages at termination, or failed to provide accurate and itemized wage statements.
Plaintiff requests the Court grant him leave to amend his complaint “if the prerequisites exist.” (Opposition, pg. 3.) Plaintiff has not met his burden to demonstrate a reasonable possibility of successful amendment of his PAGA cause of action. (Blank, 39 Cal.3d at pg. 318.) Defendants’ demurrers to the 7th cause of action are sustained without leave to amend.
Defendants Toyota Tsusho Systems US, Inc.’s and Rajat Sahi’s Motion to Strike
In light of this Court’s ruling on Defendants’ demurrer Defendants’ motion to strike portions of the complaint is denied as moot.
Dated: January ____, 2023
Hon. Monica Bachner
Judge of the Superior Court
[1] Plaintiff dismissed Defendant Advanced Reporting, LLC, from this action on December 16, 2022. Advanced Reporting, LLC’s demurrer and motion to strike Plaintiff’s Complaint are moot and the Court does not address the motions.
[2] The Court notes Plaintiff’s complaint misnumbers the paragraphs in the 7th cause of action. The Court refers to the paragraphs in the 7th cause of action in continuation of the numbered list from the first six causes of action.