Judge: Robert B. Broadbelt, Case: 24STCP00685, Date: 2025-03-12 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.

Case Number: 24STCP00685    Hearing Date: March 12, 2025    Dept: 53

Superior Court of California

County of Los Angeles – Central District

Department 53

MOVING PARTIES:              Defendants Clarence Harrison, Petra Fuhriman, and GPS Monitoring Solutions, Inc.                    

RESPONDING PARTY:       Plaintiff Jane Un, individually and on behalf of GPS Monitering Solutions, Inc.

Demurrer to First Amended Complaint

The court considered the moving papers filed in connection with this demurrer. 

The court did not consider the opposition papers filed by plaintiff Jane Un, individually and on behalf of GPS Monitering Solutions, Inc., on November 22, 2024, because (1) the proof of service states that the document served was the “Response of Defendant ABBA Bail Bonds, Inc. to Plaintiff’s Form Interrogatories—General, Set Two,” and not the opposition papers,       (2) the proof of service is also incomplete and therefore defective since (i) it states that the opposition papers were electronically served on counsel for the defendants, but (ii) it does not state the electronic service address of the person served, and (3) no reply papers were filed, such that the court cannot determine that the opposition papers were served notwithstanding these defects.  (Opp., p. 6 [proof of service]; Code Civ. Proc., § 1013b, subd. (b)(3).) 

DISCUSSION

Defendants Clarence Harrison (“Harrison”) and Petra Fuhriman (“Fuhriman”), with nominal defendant GPS Monitoring Solutions, Inc. (“GPS Monitoring”) (collectively, “Defendants”), move the court for an order sustaining their demurrer to each cause of action alleged in the First Amended Complaint, filed in this action by plaintiff Jane Un, individually and on behalf of GPS Monitering Solutions, Inc. (“Plaintiff”).

The court overrules defendant Harrison’s demurrer to the first cause of action for breach of fiduciary duty because it states facts sufficient to constitute a cause of action against him since Plaintiff has sufficiently alleged the existence of a fiduciary relationship between them because (1) “California law clearly recognizes that officers and directors owe a fiduciary duty to stockholders[,]” and (2) Plaintiff has alleged that (i) Harrison was an officer of GPS Monitoring (FAC ¶ 13), (ii) Plaintiff was the 100 percent owner and sole stockholder of GPS Monitoring (FAC ¶ 11), such that (iii) Harrison, as an officer of GPS Monitoring, owed fiduciary duties to GPS Monitoring’s stockholders, including Plaintiff (FAC ¶ 22).  (Code Civ. Proc., § 430.10, subd. (e); Singhania v. Uttarwar (2006) 136 Cal.App.4th 416, 426; McMillin v. Eare (2021) 7 0Cal.App.5th 893, 911 [“The elements of a cause of action for breach of fiduciary duty are ‘the existence of a fiduciary relationship, breach of fiduciary duty, and damages’”].)  

Although the court notes that Defendants have argued that Harrison “was an officer in title alone” because he worked under Plaintiff’s supervision and therefore did not owe fiduciary duties to Plaintiff, the First Amended Complaint does not show, on the face thereof, that Harrison did not exercise any discretionary authority and therefore was not a fiduciary.  (GAB Business Services, Inc. v. Lindsey & Newsom Claim Services, Inc. (2000) 83 Cal.App.4th 409, 420-421, overruled on other grounds in Reeves v. Hanlon (2004) 33 Cal.4th 1140, 1154 [“an officer who participates in management of the corporation, exercising some discretionary authority, is a fiduciary of the corporation as a matter of law.  Conversely, a ‘nominal’ officer with no management authority is not a fiduciary”].)  For example, while Plaintiff has alleged that Harrison managed the business under her supervision (FAC ¶ 15), Plaintiff has also alleged that, beginning in 2022, Harrison “had less supervision by, and input from, [Plaintiff] over the operation of” GPS Monitoring (FAC ¶ 16) even if he was still required to provide her with monthly accountings and reports (Ibid.).  Thus, the First Amended Complaint does not allege facts establishing that Harrison was, as a matter of law, merely a nominal officer with no management authority, such that there did not exist a fiduciary relationship between himself and Plaintiff.  (GAB Business Services, Inc., supra, 83 Cal.App.4th at p. 421 [noting that “[w]hether a particular officer participates in management is a question of fact”].)

The court overrules defendant Fuhriman’s demurrer to the second cause of action for aiding and abetting breach of fiduciary duty because it states facts sufficient to constitute a cause of action against her since Plaintiff has alleged sufficient facts establishing that Fuhriman substantially assisted and encouraged Harrison to breach his fiduciary duties by alleging that Fuhriman “participated in the discussions, planning, and implementation of the bad faith freeze-out and take-over of [GPS Monitoring] by” Harrison (FAC ¶ 27).  (Code Civ. Proc., § 430.10, subd. (e); Nasrawi v. Buck Consultants LLC (2014) 231 Cal.App.4th 328, 343 [elements of claim for aiding and abetting breach of fiduciary duty].)

The court overrules Defendants’ demurrer to the third cause of action for declaratory and injunctive relief on the ground that “Plaintiff has failed to state a cause of action for which relief can be granted” because the court has overruled the demurrer to the first and second causes of action.  (Code Civ. Proc., § 430.10, subd. (e); Dem., p. 5:16-19.)  The court notes that Defendants did not argue that the third cause of action does not state facts sufficient to constitute a cause of action for any other reason.

ORDER

            The court overrules defendants Clarence Harrison, Petra Fuhriman, and GPS Monitoring Solutions, Inc.’s demurrer to plaintiff Jane Un, individually and on behalf of GPS Monitering Solutions, Inc.’s First Amended Complaint.

            The court orders defendants Clarence Harrison, Petra Fuhriman, and GPS Monitoring Solutions, Inc. to file an answer to plaintiff Jane Un, individually and on behalf of GPS Monitering Solutions, Inc.’s First Amended Complaint within 10 days of the date of this order.

            The court orders plaintiff Jane Un, individually and on behalf of GPS Monitering Solutions, Inc., to give notice of this ruling.

IT IS SO ORDERED.

DATED:  March 12, 2025

_____________________________

Robert B. Broadbelt III

Judge of the Superior Court