Judge Robert B. Broadbelt, Case Number: 22STCV20453, Date: 2024-03-01 Tentative Ruling

Judge: Robert B. Broadbelt, Case: 22STCV20453, Date: 2024-03-01 Tentative Ruling

Tentative rulings are sometimes, but not always, posted. The purpose of posting a tentative ruling is to to help focus the argument. The posting of a tentative ruling is not an invitation for the filing of additional papers shortly before the hearing.

MOVING PARTY: Defendant Los Angeles County Metropolitan Transportation Authority

The court considered the moving, opposition, and reply papers filed in connection with the demurrer and motion to strike.

Plaintiffs MARRS Services, Inc. (“Plaintiff”) filed the operative First Amended Complaint in this action on June 22, 2023, against defendant Los Angeles County Metropolitan Transportation Authority (“Defendant”). The First Amended Complaint alleges eight causes of action for (1) violation of Government Code section 4525 et seq.; (2) violation of Government Code section 4529.12, et seq.; (3) promissory estoppel; (4) breach of the implied covenant of good faith and fair dealing; (5) negligence; (6) intentional interference with prospective economic advantage; (7) negligent interference with prospective economic relations; and (8) civil conspiracy.

Defendant now moves the court for an order (1) sustaining its demurrer to each cause of action alleged in the First Amended Complaint, and (2) striking from the First Amended Complaint various allegations and Plaintiff’s requests for injunctive relief, compensatory damages, and punitive damages.

The court sustains Defendant’s demurrer to Plaintiff’s first through eighth causes of action because they do not state facts sufficient to constitute causes of action since Plaintiff has not alleged facts demonstrating that Plaintiff complied with the claim presentation requirements set forth in the Government Claims Act. (Code Civ. Proc., § 430.10, subd. (e); Lowry v. Port San Luis Harbor District (2020) 56 Cal.App.5th 211, 218 [“‘[F]ailure to allege facts demonstrating or excusing compliance with the claim presentation requirement subjects a claim against a public entity to a demurrer for failure to state a cause of action’”].)

In connection with the first through eighth causes of action, Plaintiff alleges that it has been damaged in an amount to be determined at trial, and therefore is seeking damages on those causes of action.[1] (FAC ¶¶ 51, 59, 65, 72, 77, 83, 84 [requesting punitive damages in connection with sixth cause of action], 91, 96, 97 [requesting punitive damages in connection with eighth cause of action]; FAC, pp. 22-24 [Prayer].) Thus, because Defendant is a public entity from which Plaintiff is seeking damages, Plaintiff is required to allege compliance (or excusal from compliance) with the Government Claims Act. (FAC ¶ 2 [Defendant is “a governmental public transportation agency”]; Gov. Code, § 945.4 [“no suit for money or damages may be brought against a public entity on a cause of action for which a claim is required to be presented . . . until a written claim therefor has been presented to the public entity and has been acted upon by the board, or has been deemed to have been rejected by the board”]; Lowry, supra, 56 Cal.App.5th at p. 218.)

“‘The essential elements of a claim are set forth in Government Code section 910.’” (A.S. v. Palmdale School Dist. (2023) 94 Cal.App.5th 1091, 1096; Gov. Code, § 910.) “Among other mandatory contents, section 910 specifies that a claim ‘shall’ include ‘[t]he date, place and other circumstances of the occurrence or transaction which gave rise to the claim asserted,’ ‘[a] general description of the . . . injury, damage or loss incurred so far as it may be known at the time of presentation of the claim,’ and ‘[t]he name or names of the public employee or employees causing the injury, damage, or loss, if known.’” (Hernandez v. City of Stockton (2023) 90 Cal.App.5th 1222, 1230-1231.)

First, the court acknowledges that Plaintiff has alleged, in order to assert that it has exhausted all administrative remedies, that Plaintiff timely submitted a Protest (and subsequently, an Appeal of Protest) to Defendant. (FAC ¶¶ 32-38.) The court further acknowledges that Plaintiff has alleged that it submitted these documents to Defendant “in accordance with [Defendant’s] Policies and Procedures [i.e., the “Acquisition Policy and Procedure Manual”], including its Protest Instructions[.]” (FAC ¶¶ 32, 9 [defining “Policies and Procedures”].) However, it appears that Defendant’s “Policies and Procedures” set forth a grievance procedure separate from and independent of the Government Claims Act. Thus, the Protest and Appeal of Protest submitted by Plaintiff to Defendant in accordance with Defendant’s own grievance procedure regarding its acquisitions does not satisfy or displace the claim presentation requirement under the Government Claims Act.

Second, even if the court were to construe the Protest and Appeal of Protest (collectively, the “Protests”) to be a claim within the meaning of the Government Claims Act, the court finds that the allegations regarding Plaintiff’s submissions of the Protests do not allege that Plaintiff complied with that statute. (FAC ¶¶ 32, 36.)

Plaintiff has not attached copies of the Protests submitted to Defendant to the First Amended Complaint. Instead, Plaintiff has alleged the following: (1) the Protest (i) “discussed [Plaintiff’s] concerns with the proposal selection process at length,” including the premature and improper disclosures of information by Brad Owen, an executive officer for Defendant, (ii) discussed the deficient Board Report, (iii) requested Zephyr be excluded altogether due to the bias and favoritism showed it during the procurement process, and (iv) set forth its analysis of Zephyr’s proposal and the communications between Plaintiff and Zephyr before it withdrew from Plaintiff’s team, and (2) the Appeal of Protest reiterated Plaintiff’s concerns with the procurement process and Defendant’s repeated failure to justify the award of the Request for Proposal to Zephyr. (FAC ¶¶ 33-34, 36.) However, these allegations do not establish that the Protest and/or Appeal of Protest set forth all the information required by Government Code section 910. For example, these allegations do not state that Plaintiff provided to Defendant “[a] general description of . . . [the] damage or loss incurred[,]”the amount of the claim, if it totaled less than $10,000, or “whether the claim would be a limited civil case.” (Code Civ. Proc., § 910, subds. (d), (f).)

Thus, the court finds that the allegations of the First Amended Complaint do not establish that Plaintiff strictly complied with the claim presentation requirements set forth in the Government Claims Act.

Third, even if the court were to construe the Protests to be a claim within the meaning of the Government Claims Act, the court finds that the allegations regarding Plaintiff’s submissions of its Protests do not allege substantial compliance with that statute.

“‘[A] claim under Government Code section 910 is sufficient if (1) there is “some compliance with all of the statutory requirements”; and (2) the claim discloses sufficient information to enable the public entity adequately to investigate the merits of the claim so as to settle the claim, if appropriate. [Citation.] The latter inquiry is known as the substantial compliance test.” (A.S., supra, 94 Cal.App.5th at p. 1097 [emphasis in original].) “‘The [substantial compliance] doctrine is based on the premise that substantial compliance fulfills the purpose of the claims statutes, namely, to give the public entity timely notice of the nature of the claim so that it may investigate and settle those having merit without litigation.’” (Olson v. Manhattan Beach Unified School Dist. (2017) 17 Cal.App.5th 1052, 1060.) “The doctrine of substantial compliance, however, cannot cure total omission of an essential element from the claim or remedy a plaintiff’s failure to comply meaningfully with the statute.” (Loehr v. Venture County Community College Dist. (1983) 147 Cal.App.3d 1071, 1083.)

Here, as alleged, the Protests did not (1) set forth the dollar amount claimed (if it amounted to less than $10,000), or (2) indicate whether the claim would be a limited civil case. (Gov. Code, § 910, subd. (f).) Further, the Protests are not alleged to have indicated that Plaintiff would be seeking any amount of damages from Defendant, or that Plaintiff suffered damages or losses based on Defendant’s conduct. (Gov. Code, § 910, subds. (d), (f).) The court finds, based on these omissions, that Plaintiff’s Protests did not “disclose[] sufficient information to enable” Defendant “adequately to investigate the merits of [Plaintiff’s] claim so as to settle the claim,” and therefore finds that, as alleged, Plaintiff did not substantially comply with the claims presentation requirements. (A.S., supra, 94 Cal.App.5th at p. 1097 [“a failure to even estimate the amount of damages on the claim document cannot be remedied by application of the [substantial compliance] doctrine”]; Loehr, supra, 147 Cal.App.3d at p. 1083 [total omission of an essential element cannot be cured by substantial compliance].)

Fourth, even if the court were to construe the Protests to be a claim within the meaning of the Government Claims Act, the court finds that they do not constitute “claims as presented.”

“‘A claim that fails to substantially comply with sections 910 and 910.2 may still be considered a ‘claim as presented’ if it puts the public entity on notice both that the claimant is attempting to file a valid claim and that litigation will result if the matter is not resolved.’” (Simms v. Bear Valley Community Healthcare District (2022) 80 Cal.App.5th 391, 400-401.) “An indication that litigation might ensue if the defendant does not comply with the terms under discussion is ‘the most essential element of a “claim as presented,” because it satisfies the primary purposes of the Government Claims Act: facilitating the investigation of disputes and their settlement without trial if appropriate.’” (A.S., supra, 94 Cal.App.5th at p. 1099.)

Here, Plaintiff has not alleged facts establishing that the Protests advised Defendant that, if the matter was not resolved satisfactorily, Plaintiff would file suit against it. (FAC ¶¶ 32-38.) Plaintiff did not allege that the Protests stated that Plaintiff was seeking compensation for damages suffered or otherwise advise Defendant that a lawsuit would be filed. Moreover, as set forth above, it appears that Plaintiff submitted the Protests in accordance with Defendant’s grievance procedure independent of the Government Claims Act. Thus, it appears that the submission of the Protests did not put Defendant on notice that Plaintiff was attempting to file a valid claim pursuant to that statutory scheme.

Fifth, although Plaintiff has alleged that, in June 2023, it filed a claim for damages with Defendant and a government claim with the State of California Department of General Services, Office of Risk and Insurance Management, the court finds that those claims were untimely and therefore do not satisfy the claim presentation requirement. (FAC ¶ 39.)

“A claim relating to a cause of action for death or for injury to person or to personal property or growing crops shall be presented . . . not later than six months after the accrual of the cause of action. A claim relating to any other cause of action shall be presented . . . not later than one year after the accrual of the cause of action.” (Gov. Code, § 911.2, subd. (a).) Plaintiff has alleged that, on October 8, 2021, Defendant issued the Notice of Intent to Award and Procurement Summary, in which Defendant awarded the Request for Proposal to Zephyr. (FAC ¶ 19.) Thereafter, on October 13, 2021, Plaintiff submitted its Protest to Defendant, which was denied on November 29, 2021. (FAC ¶¶ 32, 35.) Plaintiff’s Appeal of Protest, submitted to Defendant on December 3, 2021, was denied on December 22, 2021. (FAC ¶¶ 36-37.)

Although it appears to the court that Plaintiff’s causes of action likely accrued by October 13, 2021 (i.e., the date on which Plaintiff submitted the Protest), the causes of action accrued, at the latest, on December 22, 2021. (Bennett v. Ohio National Life Assurance Corp. (2023) 92 Cal.App.5th 723, 729 [“Generally, a cause of action accrues when it is ‘complete with all of its elements”].) Thus, the June 2023 claims—filed a year after December 22, 2022—are untimely on the face of the First Amended Complaint. (FAC ¶ 39; Gov. Code, § 911.2, subd. (a).)

For the reasons set forth above, the court finds that Plaintiff has not pleaded facts establishing that it complied with the Government Claims Act and therefore sustains Defendant’s demurrer to the First Amended Complaint. (Code Civ. Proc., § 430.10, subd. (e).)

The burden is on the plaintiff “to articulate how it could amend its pleading to render it sufficient.”¿ (Palm Springs Villas II Homeowners Assn., Inc. v. Parth (2016) 248 Cal.App.4th 268, 290.)¿ To satisfy that burden, a plaintiff “must show in what manner he can amend his complaint and how that amendment will change the legal effect of his pleading.”¿ (Goodman v. Kennedy (1976) 18 Cal.3d 335, 349.) The court finds that Plaintiff has not met its burden to articulate how it could amend its pleading to render it sufficient against Defendant and therefore sustains the demurrer without leave to amend.

Defendant moves the court for an order striking Plaintiff’s requests for injunctive relief and compensatory, punitive, and compensatory damages from the First Amended Complaint.

The court has sustained Defendant’s demurrer to all the causes of action alleged in the First Amended Complaint for the reasons set forth above. The court therefore denies Defendant’s motion to strike as moot.

The court sustains defendant Los Angeles County Metropolitan Transportation Authority’s demurrer to plaintiff MARRS Services, Inc.’s First Amended Complaint without leave to amend.

The court denies as moot defendant Los Angeles County Metropolitan Transportation Authority’s motion to strike portions of plaintiff MARRS Services, Inc.’s First Amended Complaint.

The court orders defendant Los Angeles County Metropolitan Transportation Authority to lodge and serve a proposed order of dismissal within 10 days of the date of this order pursuant to Code of Civil Procedure section 581, subdivision (f)(1).

The court orders defendant Los Angeles County Metropolitan Transportation Authority to give notice of this ruling.

[1] The court notes that (1) in connection with the first and second causes of action, Plaintiff “requests an injunction to prevent Defendants from further violating Government Code section[s] 4525, et seq. [and] 4529.12[,]” and (2) the Government Claims Act “does not apply . . . to nonpecuniary actions, ‘such as those seeking injunctive, specific or declaratory relief.’” (FAC ¶¶ 42, 49; Canova v. Trustees of Imperial Irrigation Dist. Employee Pension Plan (2007) 150 Cal.App.4th 1487, 1493.) However, because the requests for injunctive relief are vague and do not seek to enjoin any specific future activity, the court finds that the primary purpose of these causes of action is to recover damages and therefore Plaintiff must comply with the claim presentation requirements to allege them against Defendant. (Canova, supra, 150 Cal.App.4th at p. 1493 [“In determining whether the Claims Act applies, the critical question is whether the recovery of money or damages was the primary purpose of [the plaintiff’s] claims”].)

marrs services, inc. ; Plaintiff, vs. los angeles county metropolitan transportation authority , et al.; Defendants.	Case No.:	22STCV20453

	Hearing Date:	March 1, 2024

	Time:	10:00 a.m.

	[Tentative] Order RE: (1) defendant’s demurrer to first amended complaint (2) defendant’s motion to strike portions of first amended complaint