Stephanie Weichel v. California IVF Fertility Center, et al.

(1) DEMURRER TO COMPLAINT

(2) MOTION TO STRIKE

 

MOVING PARTY: Defendant Ernest J. Zeringue, M.D., Inc. (erroneously sued and served as California IVF Fertility Center and California Conceptions Donor Embryo Program)

RESPONDING PARTY(S): Plaintiff Stephanie Weichel

STATEMENT OF MATERIAL FACTS AND/OR PROCEEDINGS:

Plaintiff Stephanie Weichel purchased donated embryos through the California IVF Fertility Center and its donor embryo program (collectively, “Defendants”.) After becoming pregnant using in vitro fertilization, Plaintiff gave birth to twin boys on April 1, 2022. One of the children, A.W., was born with life threatening ailments, and died two months after birth. I.W., the surviving twin, also suffers from several genetic diseases.

Plaintiff alleges that Defendants failed to properly vet and maintain an accurate profile of the sperm donor, including information on the donor’s family history and genetic conditions.  Plaintiff further alleges that Defendants falsely represented their accreditations. Plaintiff brings causes of action against Defendants for (1) Violation of California’s Unfair Competition Law, (2) Violation of Washington’s Unfair Competition Law, (3) Breach of Contract, (4) Breach of Contract, (5) Intentional Misrepresentation, (6) Negligent Misrepresentation, (7) Breach of Fiduciary Duty, (8) Breach of Warranty, and (9) Negligence.

Defendants now demur to the First, Fifth, Seventh, and Eighth Causes of Action.  Defendants also move to strike various allegations from the Complaint. Plaintiff opposed both motions.

TENTATIVE RULING:

Defendant’s Demurrer to the First, Fifth, and Eighth Causes of Action is OVERRULED.

Defendant’s Demurrer to the Seventh Cause of Action is SUSTAINED. Generally speaking, leave to amend must be allowed where there is a reasonable possibility of successful amendment.  (Goodman v. Kennedy (1976) 18 Cal.3d 335, 348.) Plaintiff must demonstrate this possibility at the hearing.

Defendant’s Motion to Strike is GRANTED IN PART, DENIED IN PART, and MOOT IN PART, as expressly stated herein. 

If no leave to amend is granted, the moving party shall file an Answer within 21 days.

Moving parties to give notice, unless waived.

DISCUSSION:

Demurrer to Complaint

I. Meet and Confer

The Declaration of attorney Simon T. Swerdlov confirms that the meet and confer requirement was satisfied. 

II. Legal Standard

A demurrer for sufficiency tests whether the complaint states a cause of action.  (Hahn v. Mirda (2007) 147 Cal. App. 4th 740, 747.)  When considering demurrers, courts read the allegations liberally and in context.  (Taylor v. City of Los Angeles Dept. of Water and Power (2006) 144 Cal. App. 4th 1216, 1228.)  In a demurrer proceeding, the defects must be apparent on the face of the pleading or by proper judicial notice.  (CCP § 430.30(a).)  A demurrer tests the pleadings alone and not the evidence or other extrinsic matters.  (SKF Farms v. Superior Court (1984) 153 Cal. App. 3d 902, 905.)  Therefore, it lies only where the defects appear on the face of the pleading or are judicially noticed.  (Id.)  The only issue involved in a demurrer hearing is whether the complaint, as it stands, unconnected with extraneous matters, states a cause of action.  (Hahn, 147 Cal.App.4th at 747.)  

III. Analysis

Defendants demur to the First, Fifth, Seventh, and Eighth Causes of Action in the Complaint. Each is addressed in turn.

A. Demurrer to First Cause of Action for Violation of the UCL

First, Defendants argue the First Cause of Action brought under the Unfair Competition Law is deficient because Plaintiff has not pled the alleged violations with the particularity necessary for statutory claims. Defendants further contend that any allegations in the complaint are attributed to Defendant Seattle Sperm Bank, and not the moving Defendants.

Business and Professions Code section 17200 defines “unfair competition” to include “any unlawful, unfair or fraudulent business act or practice....” “The scope of section 17200 is broad, encompassing ‘anything that can properly be called a business practice and that at the same time is forbidden by law.’ ... It governs ‘anti-competitive business practices’ as well as injuries to consumers, and has as a major purpose ‘the preservation of fair business competition.’” [Citations.] (Linear Tech. Corp. v. Applied Materials, Inc., (2007) 152 Cal. App. 4th 115, 133).  Whether a practice violates the section “is generally a question of fact which requires ‘consideration and weighing of evidence from both sides’ and which usually cannot be made on demurrer.” [Citation].  (Id.)

As a general rule, “statutory causes of action must be pleaded with particularity.” (Covenant Care, Inc. v. Superior Ct. (2004) 32 Cal. 4th 771, 790; Gutierrez v. Carmax Auto Superstores California (2018) 19 Cal. App. 5th 1234, 1261 [statutory causes of action must be pleaded “with reasonable particularity”].)

Plaintiff alleges that Defendants “engaged in false advertising or promotional practices by repeatedly asserting non-existent AATB accreditation,” and by representing that it used “up to date and advanced genetic testing using.” (Compl. ¶¶ 80, 81.) Defendants allegedly “marketed themselves as trustworthy, dependable, who are and work with clinics with AATB accreditation.” (Id. ¶ 13.) While it appears from the allegations that it was actually Defendant Seattle Sperm Bank, and not the moving Defendants who lacked the AATB accreditation, Plaintiff alleges that the moving Defendants made “assurances that SSB was accredited and compliant with all relevant regulations.” (Id. ¶ 62.)

Considering these allegations and accepting them as true, Plaintiff has sufficiently alleged a violation of the UCL for purposes of a demurrer. (See Fox v. JAMDAT Mobile, Inc., 185 Cal. App. 4th 1068, 1078 [ “A demurrer accepts as true all well pleaded facts” in the Complaint].)

Accordingly, Defendants’ Demurrer to the First Cause of Action is OVERRULED.

B. Demurrer to Fifth Cause of Action for Intentional Misrepresentation

Next, Defendants argue the Fifth Cause of Action fails because any intentional misrepresentations alleged in the Complaint are not attributable to the moving Defendants. 

The essential elements of a claim for intentional misrepresentation or fraud are “(1) a misrepresentation, (2) knowledge of falsity, (3) intent to induce reliance, (4) actual and justifiable reliance, and (5) resulting damage.”  (Chapman v. Skype Inc., (2013) 220 Cal. App. 4th 217, 230–31.)  Generally, “[i]n California, fraud must be pled specifically; general and conclusory allegations do not suffice.” (Alfaro v. Community Housing Improvement System & Planning Assn., Inc.¿(2009) 171 Cal.App.4th 1356, 1384, internal quotations omitted.) “The normal policy of liberally construing pleadings against a demurrer will not be invoked to sustain a fraud cause of action that fails to set forth such specific allegations. (Id.)” The heightened pleading standard for fraud requires “pleading facts which show how, when, where, to whom, and by what means the representations were tendered.” (Id.)

Again, Plaintiff alleges that Defendants California Fertility Defendants and SSB “marketed themselves as trustworthy, dependable, who are and work with clinics with AATB accreditation.” (Compl. ¶ 13.) Plaintiff further alleges that Defendants worked with Seattle Sperm Bank, who in fact was not accredited by AATB. (Id. ¶ 25.) Plaintiff also alleges that the Donor Agreement and Donor Profile provided by Defendants contained material misrepresentations or omissions regarding the sperm donor’s genetic information, previous fertility, and family health history. (Id. ¶ 20, 21.) 

While it is unclear if the moving Defendants had direct knowledge of the alleged falsities, it is alleged, at the very least, that Defendants failed to utilize thorough testing measures despite knowledge of their existence. (Id. ¶ 23.) These allegations, taken as true, are sufficient to support Plaintiff’s claim against the moving Defendants for an intentional misrepresentation. 

Accordingly, Defendants’ Demurrer to the Fifth Cause of Action is OVERRULED.

C. Demurrer to Seventh Cause of Action for Breach of Fiduciary Duty

Next, Defendants argue the seventh cause of action for breach of fiduciary duty fails because Defendants owed no fiduciary duties to Plaintiff. 

“The elements of a cause of action for breach of fiduciary duty are: (1) existence of a fiduciary duty; (2) breach of the fiduciary duty; and (3) damage proximately caused by the breach.” (Gutierrez v. Girardi (2011) 194 Cal.App.4th 925, 932 [125 Cal.Rptr.3d 210].)

Both fiduciary and confidential relationships give rise to a fiduciary duty, that is, a duty “to act with the utmost good faith for the benefit of the other party.” (Persson v. Smart Inventions, Inc. (2005) 125 Cal. App. 4th 1141, 1160.) A “confidential relationship” describes “... any relation existing between parties to a transaction wherein one of the parties is in duty bound to act with the utmost good faith for the benefit of the other party.”  (Barbara A. v. John G. (1983) 145 Cal. App. 3d 369, 382) (Emphasis added). The essential elements of a “confidential relationship” are: “(1) the vulnerability of one party to the other; (2) results in the empowerment of the stronger party by the weaker which (3) empowerment has been solicited or accepted by the stronger party and (4) prevents the weaker party from effectively protecting itself.” (Persson v. Smart Inventions, Inc. (2005) 125 Cal.App.4th 1141, 1161.) In addition, “[a] confidential relationship cannot be imposed on an individual, but must be voluntarily accepted.” (Richelle L. v. Roman Catholic Archbishop (2003) 106 Cal.App.4th 257, 272, fn. 6).  [A] “confidential relationship” may be founded on a moral, social, domestic, or merely personal relationship as well as on a legal relationship.  (Barbara A. v. John G. (1983) 145 C.A.3d 369, 382).  Absent a legally recognized fiduciary relationship, a confidential relationship is a question of fact.  (Id.)

First, it is noted that Plaintiff has not alleged or argued for the existence of a confidential relationship. The court therefore focuses on the existence of a standard fiduciary relationship. 

California courts have recognized breach of a fiduciary duty where a health care provider fails to “obtain the patient's informed consent and disclose personal interests unrelated to the patient's health, whether research or economic, that may affect the physician's professional judgment.” (Moore v. Regents of University of California (1990) 51 Cal.3d 120, 129.) Courts following Moore have articulated the duty as a “’duty to disclose all information material to the patient's decision,’ when soliciting a patient's consent to a medical procedure.” (Jameson, supra, 215 Cal. App. 4th at 1164.) 

These authorities, however, contemplate a physician-patient relationship. But here, Plaintiff has not identified any authority imposing a fiduciary relationship between a patient and fertility clinic. Indeed, Plaintiff recognizes that distinction in her opposition, arguing that “[t]he business relationship between CA Fertility Defendants and SSB is separate and distinct from the fiduciary duty of a physician or a medical group to provide its patient with informed consent.” (Opp. 10: 12-13.) 

Absent controlling authority to the contrary, this court declines to impose a fiduciary duty in this context on its own. Therefore, Plaintiff has failed to allege facts to recognize the existence of a fiduciary relationship between Plaintiff and the moving Defendants.

Accordingly, Defendants’ Demurrer to the Seventh Cause of Action is SUSTAINED. Generally speaking, leave to amend must be allowed where there is a reasonable possibility of successful amendment.  (Goodman v. Kennedy (1976) 18 Cal.3d 335, 348.) Plaintiff must demonstrate this possibility at the hearing. If she cannot, no leave to amend will be given.

D. Demurrer to Eighth Cause of Action for Breach of Warranty

Finally, Defendants argue Plaintiff’s Eighth Cause of Action for Breach of Warranty is defective because Plaintiff has failed to allege any warranties made or breached by the moving Defendants. Defendants also argue the cause of action is uncertain and duplicative.

First, it is noted that Plaintiff’s claim might properly be brought as three separate causes of action under the California Uniform Commercial Code,  namely: (1) breach of express warranty, (2) breach of implied warranty of merchantability, and (3) breach of implied warranty of fitness for a particular purpose. When characterizing a complaint or cross-complaint, it is policy to “emphasiz[e] substance over form.” (Ameron Internat. Corp. v. Insurance Co. of State of Pennsylvania (2010) 50 Cal.4th 1370, 1386.) For purposes of this demurrer, the court therefore construes the cause(s) of action in this manner. 

“[T]o prevail on a breach of express warranty claim, the plaintiff must prove (1) the seller's statements constitute an affirmation of fact or promise or a description of the goods; (2) the statement was part of the basis of the bargain; and (3) the warranty was breached.” (Weinstat v. Dentsply Internat., Inc. (2010) 180 Cal. App. 4th 1213, 1227 [cleaned up].) “Unlike express warranties, which are basically contractual in nature, the implied warranty of merchantability arises by operation of law. It does not ‘impose a general requirement that goods precisely fulfill the expectation of the buyer. Instead, it provides for a minimum level of quality.’ ” (American Suzuki Motor Corp. v. Superior Court (1995) 37 Cal.App.4th 1291, 1295–1296.) The implied warranty of fitness for a particular purpose, on the other hand, “envisages a specific use by the buyer which is peculiar to the nature of his business.” (Id. at 1295, fn. 2.)

Plaintiff alleges that “Defendants expressly and implied[ly] warranted their product to be free from material defects, including but not limited to defects of medical risk and egregious falsity concerning previous usage and the risks such previous use creates.” (Compl. ¶ 132.) Plaintiff further alleges that “Defendants expressly and impliedly warranted to Plaintiff that the product was reasonably safe for its intended use as genetic material for implantation.” (Id. ¶¶ 132, 133.) 

There appears to be little, if any, authorities addressing implied or express warranties made in the reproductive context. For pleadings purposes, Plaintiff has identified the existence of express or implied warranties and corresponding breaches sufficient to maintain her claims. (Id. ¶¶ 134-138.) This does not preclude a motion for summary judgment or adjudication at a later date if the law and facts permit it.

In addition, Plaintiff’s cause of action is not uncertain. [D]emurrers for uncertainty are disfavored,” and are strictly construed “because ambiguities can reasonably be clarified under modern rules of discovery.”  (Lickiss v. Fin. Indus. Regul. Auth., (2012) 208 Cal. App. 4th 1125, 1135.) It is likewise not duplicative of other claims, because plaintiff is free to plead alternative theories of recovery, even those that are inconsistent with each other. (Dubin v. Robert Newhall Chesebrough Trust (2002) 96 Cal.App.4th 465, 476-477.)

Accordingly, Defendants’ Demurrer to the Eighth Cause of Action is OVERRULED.

Motion to Strike

I. Legal Standard

A motion to strike lies either (1) to strike any irrelevant, false or improper matter inserted in any pleading; or (2) to strike any pleading or part thereof not drawn or filed in conformity with the laws of this state, a court rule or order of court.  (CCP § 436.)

II. Analysis

A. Punitive Damages

First, Defendants move to strike various portions of the Complaint that seek to impose, or allege conduct giving rise to, punitive damages.

Civil Code § 3294 provides that “[i]n an action for the breach of an obligation not arising from contract where it is proven by clear and convincing evidence that the defendant has been guilty of oppression, fraud, or malice, the plaintiff, in addition to the actual damages, may recover damages for the sake of example and by way of punishing the defendant.” 

As defined in § 3294(c):

(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 that a defendant intentionally misrepresented or concealed a material fact and did so intended to harm a plaintiff.

Defendants argue Plaintiff cannot seek punitive damages because she first must seek permission of the court under Code of Civil Procedure section 425.13. CCP § 425.13(a) provides that “[i]n any action for damages arising out of the professional negligence of a health care provider, no claim for punitive damages shall be included in a complaint or other pleading unless the court enters an order allowing an amended pleading that includes a claim for punitive damages to be filed.”  For the purposes of this section, “health care provider” means any person licensed or certified pursuant to Division 2 (commencing with Section 500) of the Business and Professions Code. (§ 425.13(b).) Section 425.13 is not limited to malpractice claims. It applies to any claim for injury “directly related to the professional services provided” by a health care provider. (Central Pathology Service Med. Clinic, Inc. v. Sup.Ct. (1992) 3 Cal. 4th 181, 191.)

Notably, Plaintiff’s opposition fails to acknowledge or address section 425.13. Based partly on the lack of an opposition, this court concludes this action is one “for damages arising out of the professional negligence of a health care provider,” which invokes CCP section 425.13. Because Plaintiff did not seek leave to seek punitive damages, those allegations are ordered STRICKEN. 

Plaintiff may file and serve a request to seek punitive damages as is required by section 425.13. The court will address any request at that time based on the “supporting and opposing affidavits presented.” (§ 425.13(a).)

B. Civil Penalties, Attorney’s Fees, and Consequential Damages under Section 17200

Next, Defendants argue that Plaintiff’s remedies sought are unavailable under the UCL.  Under her UCL claim, Plaintiff seeks “equitable relief, restitution, civil penalties, punitive damages, attorney fees, consequential damages, and all other damages available at law.” (Compl. ¶ 84.) 

As to civil penalties, section 17206(a) of the UCL provides:

(a) Any person who engages, has engaged, or proposes to engage in unfair competition shall be liable for a civil penalty not to exceed two thousand five hundred dollars ($2,500) for each violation, which shall be assessed and recovered in a civil action brought in the name of the people of the State of California by the Attorney General, by any district attorney, by any county counsel authorized by agreement with the district attorney in actions involving violation of a county ordinance, by any city attorney of a city having a population in excess of 750,000, or by a county counsel of any county within which a city has a population in excess of 750,000, by any city attorney of any city and county, or, with the consent of the district attorney, by a city prosecutor in any city having a full-time city prosecutor, in any court of competent jurisdiction.

Therefore, the statute “approves awards of civil penalties only in actions brought by specified governmental plaintiffs.” (California Med. Assn. v. Aetna Health of California Inc. (2023) 14 Cal. 5th 1075, 1085.) 

Because this action was not brought in the name of any of the enumerated categories above, civil penalties are not available under the UCL.  Thus, the claim for civil penalties is ordered STRICKEN without leave to amend.

As to attorney’s fees, the UCL “does not authorize attorney fees.” (Rose v. Bank of Am., N.A. (2013) 57 Cal. 4th 390, 399.) Therefore, to the extent that Plaintiff seeks attorney’s fees solely under the UCL, that portion of the Complaint is ordered STRICKEN without leave to amend.

As to the remaining damages, it is well settled that “[i]njunctive relief and restitution are the only remedies available under the UCL.”  (Esparza v. Safeway, Inc. (2019) 36 Cal. App. 5th 42, 53.)  Thus, “[a] UCL claim must be based on the existence of harm supporting injunctive relief or restitution.”  (Id.) Therefore, Plaintiff’s request for consequential damages and “all other damages available at law” are unavailable under the UCL, and therefore ordered STRICKEN without leave to amend.

C. Emotional Damages

First, Defendants move to strike Plaintiff request for “emotional damages” under her Seventh Cause of Action for Breach of Fiduciary Duty. (Compl. ¶ 130.) However, because Defendants’ demurrer to that cause of action is SUSTAINED, the Motion to Strike is MOOT.

Second, Defendants move to strike Plaintiff’s request for “extreme emotional damages” under her breach of warranty claim(s). (Compl. ¶ 142.) Defendants argue that only consequential and incidental damages—and not emotional damages—are available under the UCC. They appear correct. 

The UCC “must be construed and applied in the context of monetary losses actually incurred.” (Bishop v. Hyundai Motor Am. (1996) 44 Cal. App. 4th 750, 756; see also Kwan v. Mercedes-Benz of N. Am., Inc. (1994) 23 Cal. App. 4th 174, 187 [“The Legislature has made it clear the compensatory damages available to a buyer under the Act are limited to the same categories, and measured in the same manner, as those normally available to a buyer for a seller's breach of a contract for sale of goods”].) 

Plaintiff does not dispute these points in her opposition. Therefore, emotional distress damages are not recoverable for her breach of warranty claims, and this portion of the Complaint is ordered STRICKEN without leave to amend.

Accordingly, Defendants’ Motion to Strike is GRANTED IN PART, DENIED IN PART, and MOOT IN PART, as expressly stated herein. 

Moving parties to give notice.  

IT IS SO ORDERED.

Dated:   April 04, 2024 ___________________________________