Judge: Ronald F. Frank, Case: 21TRCV00715, Date: 2023-01-04 Tentative Ruling
Case Number: 21TRCV00715 Hearing Date: January 4, 2023 Dept: 8
Tentative Ruling¿
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HEARING DATE: January 4, 2023¿¿
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CASE NUMBER: 21TRCV00715
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CASE NAME: Mauro
Restrepo v. Sophie Adams, et al.
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MOVING PARTY: Defendants, Sophie Adams, George R. Adams, Tiffany Winston,
Christ Koutroumbus, Polly Koutroumbus
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RESPONDING PARTY: None
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TRIAL DATE: None set¿
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MOTION:¿ (1) Demurrer to First Amended
Complaint¿
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Tentative Rulings: (1) Sustained, and discussion by
Plaintiff’s counsel as to whether any further amendment could be made given
this second demurrer after the demurrer to the original complaint was sustained
as to some of the same causes of action
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I. BACKGROUND¿¿
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A. Factual¿¿
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On October 1, 2021, Plaintiff
filed this action. On October 11, 2022, Plaintiff filed an First Amended
Complaint (“FAC”) against Defendants, Sophie Adams aka Sophia Adams,
Sofie Adams, Sophie Psychic Services dba Palos Verdes Estates Psychic Love
Specialist by Sophia, dba Psychic Reading Meditation Center by Sophie, George
R. Adams, Tiffany Johnson aka Tiffany Adams, Christ Koutroumbus, Polly
Koutroumbus, and DOES 1 through 20 (collectively “Defendants”.) The FAC states
causes of action for: (1) Fraud; (2) Negligent Misrepresentation; and (3)
Unfair Competition. Defendants now demur to Plaintiff’s FAC.
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B. Procedural¿¿
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On
November 14, 2022 Defendants filed this demurrer. On December 15, 2022,
Plaintiff filed an opposition. The Reply was filed on December 21, 2022.
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¿II. MOVING PARTY’S GROUNDS
FOR THE DEMURRER¿¿
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Defendants demur to Plaintiff’s
FAC on the grounds that: (1) Plaintiff’s first cause of action
for fraud fails to state facts sufficient to state a cause of action and is
uncertain with respect to Defendants George R. Adams, Tiffany Winston, Christ
Koutroumbus and Polly Koutroumbus; (2) The first cause of action for Fraud
fails to state facts sufficient to state a cause of action; (3) the second
cause of action for fraud fails to state facts sufficient to state a cause of
action and is uncertain with respect to Defendants George R. Adams, Tiffany
Winston, Christ Koutroumbus and Polly Koutroumbus; (4) The second cause of
action for fraud fails to state facts sufficient to state a cause; (5) The
third cause of action for fraud fails to state facts sufficient to state a
cause of action and is uncertain with respect to Defendants George R. Adams,
Tiffany Winston, Christ Koutroumbus and Polly Koutroumbus; and (6) The Second
cause of action fails to state facts sufficient to state a cause of action as
to any Defendant.
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¿III. ANALYSIS¿
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A. Demurrer¿¿¿
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A demurrer can be used only to challenge defects that
appear on the face of the pleading under attack or from matters outside the
pleading that are judicially noticeable. (Blank v. Kirwan (1985) 39
Cal.3d 311, 318.) “To survive a demurrer, the complaint need only allege facts
sufficient to state a cause of action; each evidentiary fact that might
eventually form part of the plaintiff’s proof need not be alleged.” (C.A. v.
William S. Hart Union High School Dist. (2012) 53 Cal.4th 861, 872.) For
the purpose of testing the sufficiency of the cause of action, the demurrer
admits the truth of all material facts properly pleaded. (Aubry v. Tri-City
Hospital Dist. (1992) 2 Cal.4th 962, 966-967.) A demurrer “does not admit
contentions, deductions or conclusions of fact or law.” (Daar v. Yellow Cab
Co. (1967) 67 Cal.2d 695, 713.)¿¿¿
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Uncertainty
Defendants argue that each cause
of action is uncertain because they fail to state the parties to whom each
causes of action is directed. A pleading is uncertain if it is ambiguous
or unintelligible. (Code Civ. Proc., § 430.10, subd. (f).) A demurrer for
uncertainty may lie if the failure to label the parties and claims renders the
complaint so confusing defendant cannot tell what he or she is supposed to
respond to.¿ (Williams v. Beechnut Nutrition Corp. (1986) 185 Cal.App.3d
135, 139, fn. 2.) However, “[a] demurrer for uncertainty is strictly construed,
even where a complaint is in some respects uncertain, because ambiguities can
be clarified under modern discovery procedures.” (Khoury v. Maly's of
California, Inc. (1993) 14 Cal.App.4th 612, 616.)¿¿
Each
cause of action must specifically state the party or parties to whom the cause
of action is directed. (California Rules
of Court, Rule 2.112(4).) On review of the FAC, the
Court finds that the only language that Plaintiff may have used to differentiate
between parties is by referring to Defendant/Defendant’s in the singular versus
referencing Defendants/Defendants’ plural. Still, these minor variations still
bring about some ambiguity. As such, the Court SUSTAINS the demurrer as all
causes of action. As to whether the
Court should grant leave to amend, the Court will hear argument from counsel
for Plaintiff to whether he can truthfully draft language in yet another
amended complaint that directly states which party he is asserting which cause
of action against. It may well be, for example, that some or all causes of
action are only assertable against a single defendant, in which case leave to
amend would be granted on this pleading defect.
Fraud
Defendants
also demur to the first cause of action for fraud because they claim that it is
defective. “The elements of fraud are (a) a misrepresentation (false
representation, concealment, or nondisclosure); (b) scienter or knowledge of
its falsity; (c) intent to induce reliance; (d) justifiable reliance; and (e)
resulting damage.” (Hinesley v. Oakshade
Town Ctr. (2005) 135 Cal.App.4th 289, 294.) The facts constituting the
alleged fraud must be alleged factually and specifically as to every element of
fraud, as the policy of “liberal construction” of the pleadings will not
ordinarily be invoked. (Lazar v. Superior
Court (1996) 12 Cal.4th 631, 645.) To properly
allege fraud against a corporation, the plaintiffs must plead the names of the
persons allegedly making the false representations, their authority to speak,
to whom they spoke, what they said or wrote, and when it was said or written. (Tarmann v. State Farm Mut. Auto. Ins. Co.
(1991) 2 Cal.App.4th 153, 157.)
Here,
Plaintiff’s FAC claims that “the defendants made a false representation that harmed
him when she [presumably Ms. Adams] represented verbally and in writing that
she would “save” him, and that he would “continue to suffer greatly if he
didn’t pay attention to every word she said.” (FAC ¶¶ 41, 42.) Plaintiff’s FAC
further alleges that “Defendants knew that the representation of an advanced
degree was false when she made it, or that she made the representation
recklessly and without regard for its truth.” (FAC ¶ 44.) Moreover, Plaintiff’s
FAC claims that “Defendants intended that Plaintiff rely on the intentional
misrepresentations, as their purpose in making them was to convince him to pay
for Defendants’ services. (FAC ¶ 45.) Plaintiff’s FAC alleges that his reliance
was justifiable because Plaintiff believed that “Defendants [were] members of
the same ethnic group and the defendant claimed to have superior knowledge
about removing a curse of bad luck,” and because Defendant claimed to have a
“PHD. (FAC ¶¶ 45, 48.)
Lastly, Plaintiff’s FAC claims
that he was “harmed by the Defendants’ fraudulent conduct because Defendants
concealed the true meaning of “PHD,” and that “Plaintiff’s reliance on the
defendant’s representation of superior knowledge was a substantial factor in
causing his harm.” (FAC ¶ 48.) However, Plaintiff claims that defendant
“intentionally failed to disclose that “PHD” did not mean a doctorate degree
awarded by an institution of higher learning, a university, making the
disclosure deceptive. (FAC ¶ 48.) Plaintiff’s FAC further alleges that “he was
harmed because the defendant made a false promise to cure his bad luck,” that
“[t]he defendant did not intend to perform this promise when she made it,” that
“Defendants told Plaintiff that he could pay $1,000 at the time, and that they
would ‘worry about the rest later’.” (FAC ¶ 51.) Moreover, Plaintiff claims
that “Defendants did not perform the promised act of removing the bad luck.”
(FAC ¶ 52.)
In opposition, Defendants assert
that Plaintiff’s basis of this claim is that Mrs. Adams advertised on her
website that she was a PHD and, in fact, was not. The Court does not find this
argument to be a compelling one. As noted by Defendants, the advertisement
portrayed Mrs. Adam’s credential as “PHD” – with no spaces or periods in
between the letters. The website did not portray the credentials as “Ph.D.,” to
suggest that she held a doctorate degree. Even if the plaintiff asserts that
the use of those three capital letters without the period and without the
lowercase letter “h” was intended to mislead the reader, it is not at all clear
how a misrepresentation of one’s educational degree was intended to and/or did
induce detrimental reliance on the verbal statements allegedly made at the
psychic session or why one with a doctorate degree would be reasonably believed
to be more able to cure a bad luck curse than a psychic with no degree or a
lesser degree. Further, the FAC does not
address whether a reasonable person would believe that a Ph. D. exists for a
“life coach”. The Court will hear oral
argument from plaintiff’s counsel as to whether he can truthfully cure this
pleading defect in an amendment.
Negligent Misrepresentation
Defendants also demur to Plaintiff’s second cause of action
for negligent misrepresentation. The elements of a cause of action for
negligent misrepresentation include “[m]isrepresentation of a past or existing
material fact, without reasonable ground for believing it to be true, and with
intent to induce another’s reliance on the fact misrepresented; ignorance of
the truth and justifiable reliance on the misrepresentation by the party to
whom it was directed; and resulting damage.” (Hydro-Mill Co., Inc. v. Hayward, Tilton & Rolapp Ins. Associates,
Inc. (2004) 115 Cal.App.4th 1145, 1154, quotation marks omitted.) The facts
constituting the alleged fraud must be alleged factually and specifically as to
every element of fraud, as the policy of “liberal construction” of the
pleadings will not ordinarily be invoked. (Lazar
v. Superior Court (1996) 12 Cal.4th 631, 645.)
Here, Plaintiff’s FAC alleges that he “was harmed because
Defendants negligently misrepresented as true that he would ‘continue to suffer
greatly if he didn’t pay attention to every word she said.” (FAC ¶ 54.) Plaintiff further alleges that Defendant
negligently misrepresented that Defendant had a PHD, had been in the business
for years, and was very successful, and that she never had any complaints. (FAC
¶ 54.) Plaintiff alleges that “Defendant’s representations were not true” and
“[t]hat although Defendants may have honestly believed that Plaintiff would
continue to suffer greatly if he didn’t pay attention to every word she said,
she had no reasonable grounds for believing the representation was true when
she made it.” (FAC ¶ 55.)
However, as noted in Tarmann
v. State Farm Mut. Auto. Ins. Co., “an action based on a false promise is
simply a type of intentional misrepresentation, i.e., actual fraud. The
specific intent requirement also precludes pleasing a false promise claim as a
negligent misrepresentation.” (Tarmann v. State Farm Mut. Auto. Ins. Co.
(1991) 2 Cal.App.4th 153, 159.) Moreover, “making a promise with an honest but
unreasonable intent to perform is wholly different from making one with no
intent to perform and, therefore, does not constitute a false promise.” (Ibid.)
Here, Plaintiff does not allege sufficient facts to assert that Defendant had
no intent to perform. Instead, Plaintiff even admits that “Defendants may have
honestly believed that Plaintiff would continue to greatly suffer if he didn’t
pay attention to every word she said.” (FAC ¶ 55.) As such, this Court sustains
Defendants’ demurrer as to this cause of action because Plaintiff does not
allege which Defendant(s) he is making this claim against and because Plaintiff
does not allege sufficient facts to state a claim for negligent misrepresentation.
The Court will hear oral argument from
plaintiff’s counsel as to whether he can truthfully cure this pleading defect
in an amendment.
Unfair Competition
To
set forth a claim for a violation of Business and Professions Code section
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.) To state a cause of action for violation Bus. & Prof.
Code § 17200,¿et seq., plaintiff must show: (1) a business practice; (2)
that is unfair, unlawful, or fraudulent; and (3) authorized remedy.¿ (Bus.
& Prof. Code § 17200;¿see also Paulus v. Bob Lynch Ford, Inc. (2006)
139 Cal.App.4th 659, 676.)¿ “A plaintiff alleging unfair business practice
under these statutes must state with reasonable particularity the facts
supporting the statutory elements of the violation.”¿ (Khoury v.¿Maly's¿of
California, Inc.¿(1993) 14 Cal.App.4th 612, 619.)¿ To support this cause of
action, a plaintiff must specify the statutory section that has been violated
and describe with particularity the alleged violation.¿ (See¿5 Witkin,
Cal. Procedure (5th ed. 2008), § 779, p. 196.)¿
Here, Plaintiff’s FAC claims that “Defendant’s business
practices as alleged in this complaint qualify as “unfair” under the UCL
because they (a) offend public policy; (b) are immoral, unethical,
oppressive, and unscrupulous; (c) are substantially injurious; (d) are not
justified by any countervailing benefits; and (e) cause injuries that could not
reasonably have been avoided by the injured parties themselves.” (FAC ¶ 58.) Plaintiff’s FAC also
claims that Defendants’ business practices are “fraudulent” under the UCL
because they are likely to cause members of the public to be deceived. (FAC ¶
59.)
Unfair
Plaintiff contends that
Defendant’s conduct is unfair because Defendants’ business practices
“(a) offend public policy; (b) are immoral, unethical, oppressive, and
unscrupulous; (c) are substantially injurious; (d) are not justified by any
countervailing benefits; and (e) cause injuries that could not reasonably have
been avoided by the injured parties themselves.” (FAC ¶ 58.)
“In consumer cases, the
[California] Supreme Court has not established a definitive test to determine
whether a business practice is unfair. [Citations.]” (Drum v. San Fernando
Valley Bar Assn. (2010) 182 Cal.App.4th 247, 256.) There are three types of
tests for unfairness in consumer cases: (1) “that the public policy which is a
predicate to a consumer unfair competition action under the ‘unfair’ prong of the UCL must
be tethered to specific constitutional, statutory, or regulatory provisions[;]”
(2) “whether the alleged business practice ‘is immoral, unethical, oppressive,
unscrupulous or substantially injurious to consumers and requires the court to
weigh the utility of the defendant’s conduct against the gravity of the harm to
the alleged victim[;]’ ” and (3) a three-part test that requires the consumer
injury be substantial, that the injury must not be outweighed by any
countervailing benefits to consumers or competition, and the injury must be an
injury that consumers themselves could not reasonably have avoided. (Id.
at 256-57.)
Plaintiff seems to attempt
to argue that claim for the violation of the UCL can be unfair under all three
tests. Under the first test, Plaintiff cannot proceed because although he
alleges a public policy argument, public policy arguments must be tethered to a
specific constitutional, statutory, or regulatory provisions. Here, Plaintiff’s
FAC does not cite to another constitutional, statutory, or regulatory
provision. However, under the second test, Plaintiff does claim that
Defendants’ business practices are immoral, unethical, oppressive, and
unscrupulous. As such, this Court is to weigh the utility of the defendants’
conduct against the gravity of the alleged harm to Plaintiff. Here, Plaintiff
claims that he has suffered economic injury as a result of the Defendants’
unfair and fraudulent business practices. He notes the money lost includes, but
is not limited to: “(a) transportation costs incurred to appear at
Defendants’ location; (b) the medical expenses related to treatment for severe
emotional distress and complications arising therefrom; and (c) loss of
employment caused by Plaintiff’s dependence on Defendants’ business practice.”
(FAC ¶ 60.)
Fraudulent
Plaintiff contends that
Defendant’s conduct was fraudulent because “they are likely to cause members of
the public to be deceived.” (FAC ¶ 59.) Case law
has held “‘In order to state a cause of action under the fraud prong
of [section 17200] a plaintiff need not show that he or others were actually
deceived or confused by the conduct or business practice in question. ‘The
“fraud” prong of [section 17200] is unlike common law fraud or deception. A
violation can be shown even if no one was actually deceived, relied upon the
fraudulent practice, or sustained any damage. Instead, it is only necessary to
show that members of the public are likely to be deceived.’ [Citations.] (Schnall
v. Hertz Corp. (2000) 78 Cal.App.4th 1144, 1167–1168 [93 Cal. Rptr. 2d 439].)” (Progressive
West Ins. Co. v. Superior Court, 135 Cal.App.4th 263, 284.) However,
Proposition 64 was passed on November 2, 2004 in an effort to curb “‘[f]rivolous unfair competition lawsuits
[that] clog our courts[,] cost taxpayers” and “threaten[] the survival of small
businesses. . .’ [Citations.] ” (Californians for Disability Rights v.
Mervyn's LLC (2006) 39 Cal. 4th 223, 228.) Current law requires that one “suffer[] injury in fact and has lost money or property as a result
of such unfair competition”
to have standing to bring a UCL claim. (Id. at 227.) “Therefore, the
holding that "damages are unnecessary" is no longer good.” (Sanchez
v. Bear Stearns Residential Mortg. Corp. (2010) 2010 U.S. Dist. LEXIS
46043, 18, fn
4.)
Here, while not in the
Unfair Competition section of Plaintiff’s FAC, Plaintiff alleges that he paid
$1,000 toward the $5,100 Defendant demanded to remove his curse. (FAC ¶ 26.) Plaintiff
further asserted that he suffered economic loss including but not limited to: “(a)
transportation costs incurred to appear at Defendants’ location; (b) the
medical expenses related to treatment for severe emotional distress and
complications arising therefrom; and (c) loss of employment caused by
Plaintiff’s dependence on Defendants’ business practice.” (FAC ¶ 60.) Lastly, Plaintiff’s FAC alleges that he
believes his damages will be in excess to $25,000.000. (FAC ¶ 38.)
Because Plaintiff alleges
that he was actually deceived or confused by the conduct or business practice
in question and sustained damages as a result, this Court finds that Plaintiff
meets the “fraudulent” prong under the test.
Unlawful
An unlawful business
practice under section 17200 is “ ‘an
act or practice, committed pursuant to business activity, that is at the same
time forbidden by law. [Citation.]’ ” (Bernardo
v. Planned Parenthood Federation of America (2004) 115 Cal.App.4th 322,
351; See also Smith v. State Farm Mutual Automobile Ins. Co.
(2001) 93 Cal.App.4th 700, 717-718; Progressive West Ins. Co., supra,
135 Cal.App.4th 263 at 287.) Here, Plaintiff does not claim that
Defendants’ business practice was forbidden by any cited law, but notes in
other sections that Defendants’ business practices were fraudulent and that
they engaged in negligent misrepresentation.
The Court finds that the UCL
allegations, while thin and borderline, satisfy the substantive requirements
for stating a cause of action at the pleading stage. But the cause of action suffers from the Rule
of Court 2.112 defect, so leave to amend is granted.
IV. CONCLUSION¿¿
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For the foregoing reasons,
Defendants’ Demurrer is SUSTAINED as to the entire complaint for not alleging the
specific Defendants against whom his alleged causes of action are brought
against, and because Plaintiff fails to state facts sufficient to state a claim
for fraud and negligent misrepresentation.
The issue of leave to amend will await oral argument as noted above.
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Moving party is ordered to give
notice.¿¿¿¿