Judge Peter A. Hernandez, Case Number: 24STCV31109, Date: 2025-05-01 Tentative Ruling

1. Defendants Society One, Inc., Golden TV, Inc., ChimeTV, Inc., and Takashi Cheng’s Demurrer is OVERRULED as to the first through fourth, eighth, tenth, and eleventh causes of action; and SUSTAINED as to the fifth and sixth causes of action.

2. Defendants Society One, Inc., Golden TV, Inc., ChimeTV, Inc., and Takashi Cheng’s Motion to Strike is DENIED in part and GRANTED in part.

3. Defendants Faith Bautista and Victor G. Tamashiro’s Demurrer is OVERRULED as to the first cause of action; SUSTAINED as to the second cause of action; and OVERRULED as moot as to the fifth and sixth causes of action.

The court will inquire whether leave to amend should be granted as the hearing.

On November 25, 2024, Plaintiff Robert Rose (“Plaintiff”) filed a complaint against Defendants Society One, Inc.; Golden TV, Inc.; ChimeTV, Inc.; Takashi Cheng; Faith7, Inc.; Faith Bautista; and Victor G. Tamashiro (“Defendants”) arising from Plaintiff’s employment with Defendants alleging causes of action for:

On February 26, 2025, Defendants Faith Bautista and Victor G. Tamashiro filed this Demurrer to Plaintiff’s complaint. On March 14, 2025, Plaintiff filed an opposition. On March 20, 2025, Moving Defendants filed a reply.

On March 7, 2025, Defendants Society One, Inc., Golden TV, Inc., ChimeTV, Inc., and Takashi Cheng filed this Demurrer and Motion to Strike to Plaintiff’s complaint. On April 17, 2025, Plaintiff filed oppositions. On April 24, 2025, Moving Defendants filed replies.

1. Defendants Society One, Inc., Golden TV, Inc., ChimeTV, Inc., and Takashi Cheng’s Demurrer

“The party against whom a complaint or cross-complaint has been filed may object, by demurrer or answer as provided in Section 430.30, to the pleading on any one or more of” various grounds listed in statute. (Code Civ. Proc., § 430.10.)

When considering demurrers, courts read the allegations liberally and in context. In a demurrer proceeding, the defects must be apparent on the face of the pleading or via proper judicial notice. (Donabedian v. Mercury Ins. Co. (2004) 116 Cal.App.4th 968, 994.) “A demurrer tests the pleading alone, and not the evidence or facts alleged.” (E-Fab, Inc. v. Accountants, Inc. Servs. (2007) 153 Cal.App.4th 1308, 1315.) As such, the court assumes the truth of the complaint’s properly pled or implied factual allegations. (Ibid.) The only issue a demurrer is concerned with is whether the complaint, as it stands, states a cause of action. (Hahn v. Mirda (2007) 147 Cal.App.4th 740, 747.)

Where a demurrer is sustained, leave to amend must be allowed where there is a reasonable possibility of successful amendment. (Goodman v. Kennedy (1976) 18 Cal.3d 335, 348.) The burden is on the plaintiff to show the court that a pleading can be amended successfully. (Id.; Lewis v. YouTube, LLC (2015) 244 Cal.App.4th 118, 226.) However, “[i]f there is any reasonable possibility that the plaintiff can state a good cause of action, it is error to sustain a demurrer without leave to amend.” (Youngman v. Nevada Irrigation Dist. (1969) 70 Cal.2d 240, 245).

Defendants Society One, Inc., Golden TV, Inc., ChimeTV, Inc., and Takashi Cheng (“Moving Defendants”) demur to Plaintiff’s complaint, pursuant to Code of Civil Procedure section 430.10, on the grounds that each claim fails to state facts sufficient to constitute causes of action.

Moving Defendants argue that Plaintiff’s alter ego allegations are conclusory and insufficient to impose liability under that theory. (Demurrer, at p. 6.)

To allege alter ego, plaintiffs must plead a unity of interest and ownership such that the separate personalities of the corporation and individuals do not exist, and that an inequity will result if the corporate entity is treated as the sole actor. (Tomaselli v. Transamerica Ins. Co. (1994) 25 Cal.App.4th 1269, 1285; Vasey v. Cal. Dance Co. (1977) 70 Cal.App.3d 742, 749; Minifie v. Rowley (1921) 187 Cal. 481, 487. But see Greenspan v. LADT, LLC (2010) 185 Cal.App.4th 1413, 1445 [“‘[W]here a defendant is charged with liability[,] his denial thereof is sufficient to establish [his] liability upon the principle of alter ego even though the complaint is devoid of such an allegation.’”].)

Here, Plaintiff’s complaint alleges that “Defendants were responsible for the events and damages alleged [as] (a) Defendants committed the acts alleged; (b) at all relevant times, one or more of the Defendants was the agent or employee, and or/acted under the control or supervision, of one or more of the remaining Defendants and, in committing the acts alleged acted within the course and scope of such agency and employment and/or is or are otherwise liable for Plaintiff’s damages; (c) at all relevant times, there existed a unity of ownership and interest between or among two or more of the Defendants such that any individuality and separateness between or among those Defendants has ceased; (d) Defendants were the successors-in-interest and/or alter egos of the other Defendants in that they purchased, controlled, dominated and operated each other without any separate identity, observation of formalities, or any other separateness. Adherence to the fiction of the separate existence of Defendants would permit abuse of the corporate privilege and would perpetuate a fraud and injustice.” (Complaint, ¶ 14.)

The court finds that Plaintiff’s allegations are sufficient to invoke alter ego liability. A plaintiff only needs to allege ultimate facts to plead alter ego and survive demurrer. (Rutherford Holdings, LLC v. Plaza Del Rey (2014) 223 Cal.App.4th 221, 236.) Additionally, “less particularity . . . is required where the defendant may be assumed to possess knowledge of the facts at least equal, if not superior, to that possessed by the plaintiff.” (Id., at 236.) As such, alter ego allegations may be pled generally and the principal factors for piercing the corporate veil may be alleged in conclusory terms and plaintiff may be given an opportunity to present evidence to support these allegations. (First Western Bank & Trust Co. v. Bookasta (1968) 267 Cal.App.2d 910, 914-16.)

The standard elements of a claim for breach of contract are (1) the contract, (2) plaintiff’s performance or excuse for nonperformance, (3) defendant’s breach, and (4) damage to plaintiff therefrom. (Wall Street Network, Ltd. v. New York Times Co. (2008) 164 Cal.App.4th 1171, 1178.)

Moving Defendants argue that Plaintiff cannot allege a breach of contract claim against them since the contract at issue here was solely between Plaintiff and Defendant Faith7, Inc. (“Faith7”), signed by Defendant Faith Bautista as Faith7’s CEO. (Demurrer, at pp. 6-7.)

However, Plaintiff sufficiently alleges successor liability as to Plaintiff’s employment agreement. Generally, a successor corporation acquiring the assets of another corporation does not assume the selling corporation's debts and liabilities, with five exceptions: 1) an express or implied agreement of assuming liability; 2) a merger of the two corporations; 3) a mere continuation of the seller; 4) a fraudulent attempt to avoid liability for the seller's debts; and 5) tests applicable in products liability cases. (Daniell v. Riverside Partners I, L.P. (2012) 206 Cal.App.4th 1292, 1300-1301; CenterPoint Energy, Inc. v. Superior Court (2007) 157 Cal.App.4th 1101, 1120; Franklin v. USX Corp. (2001) 87 Cal.App.4th 615, 627 (concluding that there was no merger, continuance or agreement to assume liabilities, for imposing any successor liability, in asbestos case); McClellan v. Northridge Park Townhome Owners Ass'n (2001) 89 Cal.App.4th 746, 753-754.) Here, Plaintiff alleges that an employment contract existed providing that Plaintiff would act as president of ChimeTV for a term of two years. (Complaint, ¶ 21, Exh. B.) Once Cheng acquired ChimeTV in June 2023, Plaintiff continued his employment without modifications. (Id., ¶ 30.) As pled, Moving Defendants assumed Plaintiff’s employment contract at least through their implied agreement to continue Plaintiff’s employment. Such allegations sufficiently plead successor’s liability as to Moving Defendants.

Moreover, the complaint alleges that Faith7 was acquired by Defendant Takashi Cheng (“Cheng”), through Defendants Society One, Inc. and Golden TV, Inc. (Complaint, ¶¶ 2.) Plaintiff also alleges that on June 5, 2023, Faith7 changed its name to ChimeTV, Inc. (Id., ¶ 10.) Such allegations, in addition to Plaintiff’s alter ego claims, sufficiently impose liability onto Moving Defendants for breach of contract.

Accordingly, Moving Defendants’ demurrer to the first cause of action is overruled.

2^nd Cause of Action – Breach of the Covenant of Good Faith and Fair Dealing

The elements for breach of the implied covenant of good faith and fair dealing are: (1) existence of a contract between plaintiff and defendant; (2) plaintiff performed his contractual obligations or was excused from performing them; (3) the conditions requiring defendant’s performance had occurred; (4) the defendant unfairly interfered with the plaintiff’s right to receive the benefits of the contract; and (5) the plaintiff was harmed by the defendant’s conduct. (Merced Irr. Dist. V. County of Mariposa (E.D. Cal. 2013) 941 F.Supp.2d 1237, 1280 [discussing California law].)

Moving Defendants argue that Plaintiff’s breach of the covenant of good faith and fair dealing cause of action fails for the same reasons as his breach of contract claim. (Demurrer, at pp. 10-11.) However, as the court has found Plaintiff’s breach of contract cause of action is sufficiently pled, Moving Defendants’ demurrer to the second cause of action is similarly overruled.

3^rd and 4^th Causes of Action – Age and National Origin Discrimination in Violation of FEHA

Moving Defendants argue that the discrimination causes of action fail because Plaintiff did not carry his burden to show that Plaintiff exhausted his administrative remedies as Plaintiff failed to attach the whole complaint made to the California Civil Rights Department. (Demurrer, at p. 11.)

The court finds that Plaintiff has sufficiently pled the exhaustion of his administrative remedies as the complaint alleges that “[a]ll conditions and administrative requisites to suing under the FEHA have occurred. Specifically, Plaintiff filed a complaint and obtained an immediate right to sue notice from the California Civil Rights Department (“CRD”) on 21 November 2024 (Complaint No. 202411-27135220.).” (Complaint, ¶ 19.) Moving Defendants do not provide any authority requiring Plaintiff to attach a copy of the administrative complaint or finding that Plaintiff’s allegations and partial copy attached are insufficient.

Moving Defendants also argue that Plaintiff fails to allege facts indicating that the “younger” individuals that purportedly replaced Plaintiff are not themselves within a protected class. (Demurrer, at pp. 11-12.) Moving Defendants contend that Plaintiff’s discrimination claims also fail because Plaintiff did not allege facts regarding his own qualifications or the qualifications of any of the individuals who were allegedly hired to replace Plaintiff. (Id., at p. 11.)

The court finds Moving Defendants’ arguments unpersuasive. It appears that Moving Defendants are attempting to add additional elements to those required for a discrimination claim under FEHA. A plaintiff alleging discrimination must allege “that (1) he was a member of a protected class, (2) he was qualified for the position he sought or was performing competently in the position he held, (3) he suffered an adverse employment action, such as termination, demotion, or denial of an available job, and (4) some other circumstance suggests discriminatory motive.” (Guz v. Bechtel National Inc. (2000) 24 Cal.4th 317, 355.) There is no requirement that Plaintiff alleges that those replacing him are not part of a protected class or even that a different employee replaced Plaintiff. There is also no requirement that Plaintiff alleges that those replacing him are equally qualified to take over Plaintiff’s position. All that Plaintiff must allege is that he was qualified for the position he was performing and that he was subject to an adverse employment action. Here, Plaintiff alleges that he is a Caucasian man over forty-years-old (Complaint, ¶¶ 20, 50, 60); that Plaintiff was qualified for his position (Id., ¶¶ 1, 20.); that Plaintiff was subject to an adverse employment action by being demoted, underpaid, and terminated from his position as president of ChimeTV (Id., ¶¶ 3, 30-32); and that there was a discriminating motive for such adverse employment action (Id., ¶¶ 52, 62.)

Accordingly, Moving Defendants’ demurrer to the third and fourth causes of action is overruled.

5^th and 6^th Causes of Action – Intentional and Negligent Infliction of Emotional Distress

“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.)

“The law of negligent infliction of emotional distress in California is typically analyzed by reference to two theories of recovery: the ‘bystander’ theory and the ‘direct victim’ theory. The negligent causing of emotional distress is not an independent tort, but the tort of negligence. The traditional elements of duty, breach of duty, causation, and damages apply. Whether a defendant owes a duty of care is a question of law.” (Spates v. Dameron Hosp. Ass’n (2003) 114 Cal.App.4th 208, 213, ellipses, quotation marks, brackets, and paragraph breaks omitted.)

Moving Defendants argue that Plaintiff fails to allege extreme and outrageous conduct by Defendants that exceeds all bounds of what is usually tolerated in a civilized community. (Demurrer, at pp. 13-14.) Moving Defendants also argue that Plaintiff fails to allege facts to support a claim for emotional distress. (Ibid.)

“A defendant’s conduct is outrageous when it is so extreme as to exceed all bounds of that usually tolerated in a civilized community.” (Jackson v. Mayweather (2017) 10 Cal.App.5th 1240, 1265 [internal citations and quotations omitted].) “Mere insults, indignities, threats, annoyances, petty oppressions, or other trivialities do not constitute extreme and outrageous conduct.” (Okorie v. Los Angeles Unified School Dist. (2017) 14 Cal.App.5th 574, 597 [internal citations and quotations omitted, overruled on other grounds by Bonni v. St. Joseph Health System (2021) 11 Cal.5th 995].) Rather, the requirements for satisfying the element of extreme and outrageous conduct are rigorous and difficult to satisfy. (Okorie, supra, 14 Cal.App.5th at 597.) “On the spectrum of offensive conduct, outrageous conduct is that which is the most extremely offensive.” (Ibid., quoting Yurick v. Superior Court (1989) 209 Cal.App.3d 1116, 1129.) “Depending on the idiosyncrasies of the plaintiff, offensive conduct which falls along the remainder of the spectrum may be irritating, insulting or even distressing but it is not actionable and must simply be endured without resort to legal redress.” (Ibid.)¿¿¿

Plaintiff’s allegations are insufficient to show that Defendants’ “extreme and outrageous” conduct that would not be tolerated in a civilized community. Plaintiff’s claims appear to rely on Defendants’ alleged discriminating motives behind their adverse employment action against Plaintiff. (Complaint, ¶¶ 67, 73.) While the complaint alleges facts demonstrating improper conduct, at least for purposes of the discrimination claims, the court does not find that these same allegations necessarily rise to the level of extreme and outrageous conduct necessary for Plaintiff’s emotional distress claims.

Accordingly, Moving Defendants’ demurrer to the fifth and sixth causes of action is sustained.

Moving Defendants argue that Plaintiff’s eighth and eleventh causes of action fail as they are premised on a contract that is unenforceable against Moving Defendants for the reasons argued above. (Demurrer, at pp. 14-15.) However, as explained above, the court finds that Plaintiff’s allegations impose liability onto Moving Defendants for the employment contract at issue here.

Moving Defendants also argue that Plaintiff’s tenth cause of action fails because Plaintiff fails to allege that he is entitled to vacation benefits to allege a viable claim under Labor Code section 227.5. (Demurrer, at p. 15.)

Labor Code section 227.3 states that “whenever a contract of employment or employer policy provides for paid vacations, and an employee is terminated without having taken off his vested vacation time, all vested vacation shall be paid to him as wages at his final rate in accordance with such contract of employment or employer policy … .” (Lab. Code, § 227.3.)

The court finds that Plaintiff sufficiently pleads a cause of action under section 227.5 as Plaintiff alleges that the employment contract at issue here includes benefits which were to be determined and that Defendant ChimeTV “willfully failed and refused to pay all vested vacation time as wages to Plaintiff upon termination.” (Complaint, ¶¶ 21, 104.) Any uncertainties regarding the terms on Plaintiff’s vacation benefits can be clarified through discovery. (Chen v. Berenjian, 33 Cal.App.5th at 822 [demurrers for uncertainty are disfavored because ambiguities can be clarified through discovery].) As it alleged

Accordingly, Moving Defendants’ demurrer to the eighth, tenth, and eleventh causes of action is overruled.

2. Defendants Society One, Inc., Golden TV, Inc., ChimeTV, Inc., and Takashi Cheng’s Motion to Strike

Pursuant to Code of Civil Procedure section 436, “the court may, upon a motion made pursuant to Section 435, or at any time in its discretion, and upon terms it deems proper: (a) Strike out any irrelevant, false, or improper matter inserted in any pleading. (b) Strike out all or any part of any pleading not drawn or filed in conformity with the laws of this state, a court rule, or an order of the court.” The grounds for a motion to strike must “appear on the face of the challenged pleading or from any matter of which the court is required to take judicial notice.” (Code Civ. Proc., § 437.)

Defendants Society One, Inc., Golden TV, Inc., ChimeTV, Inc., and Takashi Cheng (“Moving Defendants”) seek to strike Plaintiff’s allegations and request regarding punitive damages as follows:

1. Page 12, line 28, paragraph 54: “. . . and Mr. Cheng’s willful, knowing, and intentional discrimination against Plaintiff . . . .”

2. Page 13, lines 4-5, paragraph 54: “In light of the willful, knowing, and intentional discrimination, Plaintiff seeks an award of punitive and exemplary damages in an amount according to proof at trial.”

3. Page 14, line 12, paragraph 54: “. . . and Mr. Cheng’s willful, knowing, and intentional discrimination against Plaintiff . . . .”

4. Page 14, lines 14-16, paragraph 64: “In light of the willful, knowing, and intentional discrimination, Plaintiff seeks an award of punitive and exemplary damages in an amount according to proof at trial.”

Punitive damages may be awarded in an action for the breach of an obligation not arising from contract upon clear and convincing evidence that a defendant has been guilty of oppression, fraud, or malice. (Civ. Code § 3294, subd. (a).)

“Malice” is defined as “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.” (Civ. Code § 3294, subd. (c)(1).) “Oppression” is defined as “despicable conduct that subjects a person to cruel and unjust hardship in conscious disregard of that person’s rights.” (Civ. Code § 3294, subd. (c)(2).) “Fraud” is defined as “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)(3).)

Given the court sustaining Moving Defendants’ Demurrer to Plaintiff’s fifth and sixth causes of action for infliction of emotional distress, the court agrees the complaint does not state sufficient facts to support punitive damage requests based on those claims. Accordingly, the court grants Moving Defendants’ motion as to the following portions of the complaint only:

1. Page 15, lines 14-16, paragraph 71: “Defendants’ actions were malicious and oppressive. Plaintiff is thus entitled to and herein seeks punitive and exemplary damages from Defendants, in an amount according to proof at trial, to punish Defendants and deter Defendants and others from engaging in similar future conduct.”

The court overruled Moving Defendants’ Demurrer to the other causes of action supporting the remaining punitive damages requests, and accordingly finds the complaint alleges sufficient facts to state punitive damages claims in connection with those causes of action. The court therefore denies Moving Defendants’ motion as to all other punitive damages allegations and requests.

Defendants Faith Bautista and Victor G. Tamashiro (“Moving Defendants”) demur to Plaintiff’s first, second, fifth and sixth causes of action, pursuant to Code of Civil Procedure section 430.10, on the grounds that each claim fails to state facts sufficient to constitute causes of action.

Moving Defendants argue that Plaintiff’s breach of contract claim fails as neither Moving Defendant is a party to the employment agreement at issue here. (Demurrer, at pp. 4-6.) However, as explained above, the court finds that Plaintiff sufficiently pleads alter-ego claims of all Defendants imposing liability onto Moving Defendants for the breach of contract claim, even if they were not signatories. Specifically, Plaintiff alleges that Moving Defendants were alter-egos of Faith7, Inc., which is an actual signatory to the employment agreement.

Moving Defendants also argue that Plaintiff’s claim fails to allege sufficient facts to support a cause of action against them. (Ibid.) Moving Defendants note that Plaintiff’s alleges breach of the employment agreement for failure to receive 3% of the sale proceeds of Faith7, Inc.’s shares owned by Moving Defendants. (Ibid.) Nevertheless, Moving Defendants argue that the agreement provides that the details of such provision were to be determined in the employment agreement which created a condition precedent before Plaintiff could participate in a stock sale. (Ibid)

The court disagrees with Moving Defendants and finds that Plaintiff sufficiently pled a cause of action for breach of contract. Although the details of the stock sale provisions are not included in the agreement, the material terms that Plaintiff were to receive 3% of the sale proceeds and Moving Defendants breach of such provision is clearly alleged in the complaint. (Complaint, ¶¶ 2, 21, 27, 36, 40.) Any uncertainties regarding the terms on the stock sale can be clarified through discovery. (Chen, supra, 33 Cal.App.5th at 822.)

Accordingly, Moving Defendants’ demurrer to the first cause of action is overruled.

2^nd Cause of Action – Breach of the Covenant of Good Faith and Fair Dealing

Moving Defendants argue that Plaintiff’s breach of the covenant of good faith and fair dealing cause of action fails as Plaintiff has made no allegation demonstrating Moving Defendants’ conduct in violation of the covenant of good faith and fair dealing. (Demurrer, at pp. 8-9.) Moreover, Moving Defendants contends that Plaintiff’s second cause of action is based upon the same allegations as the breach of contract claims, thus it may be disregarded as superfluous. (Ibid.)

“Every contract contains an implied covenant of good faith and fair dealing providing that no party to the contract will do anything that would deprive another party of the benefits of the contract.” (Digerati Holdings, LLC v. Young Money Ent., LLC (2011) 194 Cal. App. 4th 873, 885.) “A breach of the implied covenant of good faith and fair dealing involves something beyond breach of the contractual duty itself and it has been held that bad faith implies unfair dealing rather than mistaken judgment.” (Careau & Co. v. Security Pacific Business Credit, Inc. (1990) 222 Cal.App.3d 1371, 1394.) “If the allegations do not go beyond the statement of a mere contract breach and, relying on the same alleged acts, simply seek the same damages or other relief already claimed in a companion contract cause of action, they may be disregarded as superfluous as no additional claim is actually stated.” (Id., at 1395.)

The court finds that Plaintiff fails to allege Moving Defendants’ conduct that was in bad faith and unfair, going beyond the breach of the contract at issue. Plaintiff solely alleges that Moving Defendants failed to pay Plaintiff the 3% of stock sale proceeds agreed upon. (Complaint, ¶¶ 2, 21, 27, 36, 40.) Such allegations are identical to those in the breach of contract claim, and without more, Plaintiff cannot allege a breach of the covenant of good faith and fair dealing cause of action.

Accordingly, Moving Defendants’ demurrer to the second cause of action is sustained.

5^th and 6^th Causes of Action – Intentional and Negligent Infliction of Emotional Distress

As Plaintiff agrees to dismiss the fifth and sixth causes of action against Moving Defendants, the court overrules the demurrer as moot. (Opp., at p. 17.)

1. Defendants Society One, Inc., Golden TV, Inc., ChimeTV, Inc., and Takashi Cheng’s Demurrer is OVERRULED as to the first through fourth, eighth, tenth, and eleventh causes of action; and SUSTAINED as to the fifth and sixth causes of action.

2. Defendants Society One, Inc., Golden TV, Inc., ChimeTV, Inc., and Takashi Cheng’s Motion to Strike is DENIED in part and GRANTED in part.

[1] Moving Defendants’ Notice of Demurrer states that Moving Defendants are demurring to Plaintiff’s seventh through eleventh causes of action for Labor Code violations. However, Moving Defendants fail to provide any demurring arguments as to the seventh and ninth cause of action.