Judge: Salvatore Sirna, Case: 21STCV02505, Date: 2023-01-13 Tentative Ruling

The Court may change tentative rulings at any time. Therefore, counsel are advised to check this website periodically to determine whether any changes or updates have been made to the tentative ruling. Counsel may submit on the tentative rulings by calling the clerk in Department G at (909) 802-1104 prior to 8:30 a.m. the morning of the hearing.

Case Number: 21STCV02505    Hearing Date: January 13, 2023    Dept: G

Defendant National Council of the Young Men’s Christian Associations of the United States of America’s Demurrer to Plaintiff’s Fourth Amended Complaint 

Respondent: Plaintiff Robert Mathis, II

TENTATIVE RULING

Defendant National Council of the Young Men’s Christian Associations of the United States of America’s Demurrer to Plaintiff’s Fourth Amended Complaint is OVERRULED IN PART, SUSTAINED IN PART with twenty (20) days leave to amend. 

BACKGROUND

This action arises from the sexual abuse and exploitation of a minor. Scott Wendell Bray (Bray) was the executive director of the Young Men’s Christian Association of Pomona Valley (YMCA Pomona). Plaintiff Robert Mathis, II was a minor who participated in events sponsored by YMCA Pomona. Starting in 1975 when Plaintiff was approximately 6 or 7 years of age, Bray sexually assaulted, abused, molested, and harassed Plaintiff during YMCA Pomona events. Bray also utilized Bray’s position to obtain unsupervised access to Plaintiff on parks, trails, and an out-of-state trip to Las Vegas, Nevada where Bray sexually assaulted and molested Plaintiff.

On January 21, 2021, Plaintiff filed a complaint against Does 1-50 , alleging the following causes of action: (1) childhood sexual assault in violation of Code of Civil Procedure section 340.1; (2) negligence; (3) negligent infliction of emotional distress; and (4) intentional infliction of emotional distress.

On June 25, 2021, Plaintiff filed a First Amended Complaint (FAC) against the Young Men’s Christian Association of Metropolitan Los Angeles (YMCA Metro LA), California State Alliance of YMCAs, YMCA of the USA (YMCA USA), and Does 4-50, alleging the same causes of action. On January 19, 2022, the court sustained a demurrer to the FAC by YMCA USA. 

On February 14, 2022, Plaintiff filed a Second Amended Complaint (SAC) against YMCA Metro LA, YMCA USA, and Does 4-50, alleging the same causes of action. 

On March 3, 2022, Plaintiff filed a Third Amended Complaint (TAC) against YMCA Metro LA, YMCA USA, Young Men’s Christian Association of Orange County (YMCA OC), and Does 5-50, alleging the same causes of action. 

On October 26, 2022, Plaintiff filed a Fourth Amended Complaint (4AC) against same defendants alleging the same causes of action. 

On December 14, 2022, the National Council of the Young Men’s Christian Associations of the United States of America, doing business as YMCA USA, filed the present demurrer. Prior to filing on November 17, YMCA USA’s counsel met and conferred telephonically with Plaintiff’s counsel and was unable to reach a resolution. (Harvin Decl., ¶ 4.)  

A hearing on the demurrer and a case management conference are set for January 13, 2023.

LEGAL STANDARD

A party may demur to a complaint on the grounds that it “does not state facts sufficient to constitute a cause of action.” (Code Civ. Proc., § 430.10, subd. (e).) A demurrer tests whether the complaint states a cause of action. (Hahn v. Mirda (2007) 147 Cal.App.4th 740, 747 (Hahn).) When considering demurrers, courts accept all well pleaded facts as true. (Fox v. JAMDAT Mobile, Inc. (2010) 185 Cal.App.4th 1068, 1078.) 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 pleadings alone and not the evidence or other extrinsic matters. Therefore, it lies only where the defects appear on the face of the pleading or are judicially noticed.” (SKF Farms v. Superior Court (1984) 153 Cal.App.3d 902, 905.) “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, supra, at p. 747.)¿ 

REQUEST FOR JUDICIAL NOTICE

YMCA USA requests the court take judicial notice of YMCA USA’s constitution and bylaws from 1971 and 1975 pursuant to Evidence Code section 452, subdivision (h) which allows the court take judicial notice of “[f]acts and propositions that are not reasonably subject to dispute and are capable of immediate and accurate determination by resort to sources of reasonably indisputable accuracy.” (Evid. Code, § 452, subd. (h).)

The court GRANTS YMCA USA’s request for judicial notice.

ANALYSIS

YMCA USA demurs to Plaintiff’s entire 4AC on the grounds that (1) YMCA USA is an improper party and (2) Plaintiff has not pled YMCA USA owed Plaintiff a duty as required for the first three causes of action. YMCA USA also demurs to Plaintiff’s third cause of action and fourth cause of action on separate grounds.

For the reasons set forth below, the court SUSTAINS YMCA USA’s demurrer to Plaintiff’s fourth cause of action with twenty (20) days leave to amend and OVERRULES YMCA USA’s demurrer to Plaintiff’s first, second, and ­­third causes of action.

Liability for YMCA Pomona

YMCA USA claims there are no facts to support YMCA USA as a party to this action and suggests simply sharing a name with YMCA Pomona does not make it liable for YMCA Pomona’s staff. The court agrees Plaintiff has failed to establish YMCA USA is liable for the actions of YMCA Pomona but for the reasons stated in the following sections, finds Plaintiff has stated sufficient facts to allege direct liability for the first three causes of action.

Here, Plaintiff alleged YMCA Pomona “was a California nonprofit corporation organized under California law with its principal place of business in Pomona, California.” (4AC, ¶ 5.) Plaintiff also alleged YMCA USA “was a domestic nonprofit corporation that did significant business in the State of California.” (4AC, ¶ 7.) Thus, Plaintiff established YMCA USA and YMCA Pomona as separate entities. 

“Ordinarily, a corporation is regarded as a legal entity separate and distinct from its stockholders, officers and directors.” (Communist Party v. 522 Valencia, Inc. (1995) 35 Cal.App.4th 980, 993.) Similarly, “[a] parent corporation is not liable for the torts of its subsidiaries simply because of stock ownership.” (Institute of Veterinary Pathology, Inc. v. California Health Laboratories, Inc. (1981) 116 Cal.App.3d 111, 119.) A parent corporation may be held liable for a subsidiary under the alter ego doctrine which requires “such a unity of interest and ownership between the corporation and its equitable owner that the separate personalities of the [parent] and the [subsidiary] do not in reality exist” and that “there must be an inequitable result if the acts in question are treated as those of the corporation alone.” (Sonora Diamond Corp. v. Superior Court (2000) 83 Cal.App.4th 523, 538 (Sonora Diamond).) Furthermore, “if a parent corporation exercises such a degree of control over its subsidiary corporation that the subsidiary can legitimately be described as only a means through which the parent acts, or nothing more than an incorporated department of the parent, the subsidiary will be deemed to be the agent of the parent.” (Id., at p. 541.)

Here, Plaintiff pled that YMCA USA “exercised management and control over YMCA Pomona” along with the other defendants and that YMCA Pomona was subject to standards, policies, procedures, and financial obligations established by defendants in exchange for using the name “YMCA.” (4AC, ¶ 11.) Plaintiff also pled defendants “materially benefited” from the relationship with YMCA Pomona. (4AC, ¶ 12.) However, the court finds these allegations  insufficient to establish any form of agency relationship or alter ego claim between YMCA Pomona and YMCA USA. Other than pleading YMCA USA exercised management and control over YMCA Pomona, Plaintiff has not established such a unity of interest and ownership between the two entities that renders their separate corporate personalities nonexistent. (Id., at p. 538.) Instead, Plaintiff vaguely alleges all defendants exercised management and control over YMCA Pomona. (4AC, ¶ 11.)

As to the agency theory, Plaintiff has not alleged YMCA USA’s control and management over YMCA Pomona “is so pervasive and continual that [YMCA Pomona] may be considered nothing more than an agent or instrumentality of [YMCA USA], notwithstanding the maintenance of separate corporate formalities.” (Id., at p. 541.) In fact, Plaintiff’s pleadings suggest the opposite. In describing how YMCA Pomona is subject to standards, policies, procedures, and financial obligations established by defendants including YMCA USA, Plaintiff alleges YMCA Pomona’s failure to comply would result in it being barred from using the name “YMCA.” (4AC, ¶ 11.) Thus, Plaintiff’s own pleadings suggest YMCA USA’s control over YMCA Pomona is limited to its “naming rights.” Plaintiff does not allege or demonstrate that YMCA USA’s control over YMCA Pomona was “substantial” or “complete.” (See Wickham v. Southland Corp. (1985) 168 Cal.App.3d 49, 58-59 [the right to complete control establishes principal-agency relationship as matter of law].)

Plaintiff also alleges YMCA USA assumed YMCA Pomona’s liability. Generally, “the purchaser does not assume the seller's liabilities unless (1) there is an express or implied agreement of assumption, (2) the transaction amounts to a consolidation or merger of the two corporations, (3) the purchasing corporation is a mere continuation of the seller, or (4) the transfer of assets to the purchaser is for the fraudulent purpose of escaping liability for the seller's debts.” (Ray v. Alad Corp. (1977) 19 Cal.3d 22, 28.) Here, Plaintiff alleges YMCA Pomona ceased operations in 2018 and that YMCA USA and the other defendants assumed the debts, assets, and properties of YMCA Pomona so that the transaction was the consolidation or merger of corporations. (4AC, ¶ 15.) The court finds these allegations vague and insufficient to establish whether a consolidation or merger between YMCA USA and YMCA Pomona occurred.

Accordingly, because Plaintiff did not establish YMCA Pomona was YMCA USA’s alter ego or that an agency relationship, consolidation, or merger between YMCA USA and YMCA Pomona occurred, YMCA USA cannot be held liable for the actions of YMCA Pomona, a separate corporate entity. However, as noted below, Plaintiff did allege sufficient facts to establish YMCA USA can be held directly liable under the first three causes of action.

YMCA USA’s Direct Liability

YMCA USA argues the first three causes of action fail because Plaintiff failed to establish the existence of a duty or special relationship as to YMCA USA. YMCA USA also contends Plaintiff failed to plead sufficient facts to state a claim of intentional infliction of emotional distress (IIED) (fourth cause of action). The court disagrees as to the first three causes of action but agrees as to the fourth cause of action for IIED.

Existence of Duty or Special Relationship

The basic of elements of a negligence claim are (1) duty, (2) breach, (3) causation, and (4) damages. (Leslie G. v. Perry & Associates (1996) 43 Cal.App.4th 472, 480.) “The first element, duty, ‘may be imposed by law, be assumed by the defendant, or exist by virtue of a special relationship.’” (Doe v. United States Youth Soccer Assn., Inc. (2017) 8 Cal.App.5th 1118, 1128 (Doe).) “A special relationship exists when ‘the plaintiff is particularly vulnerable and dependent upon the defendant who, correspondingly, has some control over the plaintiff's welfare. [Citation.]’” (Id., at p. 1129, quoting Kockelman v. Segal (1998) 61 Cal.App.4th 491, 499.)

Here, Plaintiff alleges Bray “was the employee, volunteer, manager, agent, or individual who otherwise provided services for YMCA POMONA and DEFENDANTS.” (4AC, ¶ 4.) Plaintiff further alleges “BRAY was an agent, managing agent, employee, and/or servant of DEFENDANTS.” (4AC, ¶ 28.) Plaintiff also alleges YMCA USA managed, maintained, operated, and controlled YMCA Pomona through its agents, servants, and employees. (4AC, ¶ 23.) Plaintiff alleges the sexual abuse occurred at YMCA Pomona events while Plaintiff was in the care or custody of YMCA Pomona. (4AC, ¶ 18-21.)

As a result, Plaintiff claims all defendants had a special relationship and duty of care to Plaintiff as Plaintiff was a “a minor child placed under their exclusive care, supervision, custody, and control.” (4AC, ¶ 30, 38-39) Plaintiff also claims defendants had a duty not to hire or retain individuals like Bray with dangerous and exploitative propensities. (4AC, ¶ 45.) A special relationship has been found in similar circumstances where adult caregivers are responsible for children, such as operators of a daycare center, school districts, babysitters, and youth soccer leagues. (Id., at p. 1129, 1131.) Thus, because Plaintiff was a minor under the care and supervision of YMCA Pomona and YMCA USA’s employees, including Bray, Plaintiff has established the existence of a duty of care and special relationship. (4AC, ¶ 18, 23.)

Accordingly, YMCA USA’s demurrer to Plaintiff’s first, second, and third causes of action is OVERRULED.

Intentional Infliction of Emotional Distress (Fourth Cause of Action)

To establish a claim of IIED, one must show “(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.” (Wilson v. Hynek (2012) 207 Cal.App.4th 999, 1009, quoting Cervantez v. J.C. Penney Co. (1979) 24 Cal.3d 579, 593.) Extreme and outrageous conduct is defined as exceeding “all bounds of decency usually tolerated by a decent society” and intending to cause mental distress. (Fisher v. San Pedro Peninsula Hospital (1989) 214 Cal.App.3d 590, 618.)¿ 

Here, Plaintiff’s 4AC fails to identify any extreme and outrageous conduct by YMCA USA that was intended to cause emotional distress or in reckless disregard. Plaintiff’s opposition suggests the extreme and outrageous conduct by YMCA USA was ignoring a report of Bray’s misconduct. However, Plaintiff’s pleadings only establish that reports were made to the board of YMCA Pomona and that no action was taken. (4AC, ¶ 25.) Plaintiff’s 4AC does not establish any intent or reckless disregard by YMCA USA, let alone that YMCA USA was aware of Bray’s misconduct. Furthermore, as previously noted, YMCA USA is a separate entity from YMCA Pomona and cannot be liable for YMCA Pomona’s knowledge and failure to act. Thus, Plaintiff fails to plead a cause of action for IIED.

Accordingly, YMCA USA’s demurrer to Plaintiff’s fourth cause of action is SUSTAINED with twenty (20) days leave to amend.

CONCLUSION

Based on the foregoing, YMCA USA’s demurrer to Plaintiff’s 4AC is SUSTAINED with twenty (20) days leave to amend as to the fourth cause of action only. The demurrer is OVERRULED as to the first, second, and third causes of action.