Judge: Salvatore Sirna, Case: 23PSCV01143, Date: 2023-11-14 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 a tentative ruling by calling the clerk in Department G at (909) 802-1104 prior to 8:30 a.m. the morning of the hearing.

Case Number: 23PSCV01143    Hearing Date: November 14, 2023    Dept: G

Defendants Ameri-Hua, Inc., Darwin Pacific Group Inc., and Ge Tao’s Motion to Strike Plaintiff’s Complaint In Its Entirety

Respondent: Plaintiff Futong Container Transportation Co Ltd

TENTATIVE RULING

Defendants Ameri-Hua, Inc., Darwin Pacific Group Inc., and Ge Tao’s Motion to Strike Plaintiff’s Complaint In Its Entirety is GRANTED IN PART as to Paragraph Fifty-Three of the Complaint with ten (10) days leave to amend and DENIED IN PART on all other grounds.

BACKGROUND

This is a breach of contract action arising from a shipping agreement. In September 2022, Plaintiff Futong Container Transportation Co Ltd (Futong) agreed to transport a container for Jitong Freight Co. (Jitong) from the Port of Los Angeles to a warehouse to a location in Rancho Cucamonga. Futong then entered into a written agreement with Defendants Ameri-Hua, Inc. (Ameri-Hua), Ge Tao, and Zhaohui Zeng in which Ameri-Hua promised to transport the container to its destination. While the container was picked up from the Port of Los Angeles, Futong alleges the container was delivered to the wrong destination and that 491 cartons of goods were lost from the container. As a result, Futong indemnified Jitong’s losses in the amount of $111,693.

On April 18, 2023, Futong filed a complaint against Ameri-Hua, Darwin Pacific Group Inc. (Darwin Pacific), Tao, Zeng, and Does 1-20, alleging the following causes of action: (1) breach of contract, (2) negligence, (3) conversion, (4) actual voidable transfer, and (5) constructive fraudulent transfer.

On July 3, 2023, Ameri-Hua, Darwin Pacific, and Tao (collectively, Defendants) filed the present motion. Prior to filing on June 12, Defendants’ counsel met and conferred with Futong’s counsel and was unable to reach a resolution. (Phou Decl., ¶ 2-3.)

A hearing on the motion to strike is set for November 14, 2023, along with a case management conference and OSC Re: Failure to File Proof of Service.

REQUEST FOR JUDICIAL NOTICE

Defendants’ request for judicial notice of filings with the California Secretary of State is GRANTED. (Evid. Code, § 452, subd. (c); Friends of Shingle Springs Interchange, Inc. v. County of El Dorado (2011) 200 Cal.App.4th 1470, 1483-1484 [judicial notice of certificates of status and statements of information proper when reviewing demurrer as “documents reflecting official acts of the executive department of the State of California”].)

ANALYSIS

Defendants move to strike the following from Futong’s Complaint: (1) punitive damages, (2) attorney’s fees, and (3) allegations that Ameri-Hua and Fame Luck are insolvent. For the following reasons, the court GRANTS Defendants’ motion in part with leave to amend as to allegations involving “Fame Luck” and DENIES Defendants’ motion on all other grounds.

Legal Standard

Upon a party’s motion or the court’s own motion, the court may strike any irrelevant, false, or improper matter inserted in any pleading. (Code Civ. Proc., § 436, subd. (a).) The court may also “[s]trike out all or any part of any pleading not drawn or filed in conformity with the laws of this state, a court rule, or an order of the court.” (Code Civ. Proc., § 436, subd. (b).) “The grounds for a motion to strike shall appear on the face of the challenged pleading or from any matter of which the court is required to take judicial notice.” (Code Civ. Proc., § 437, subd. (a).)

An immaterial or irrelevant allegation includes “(1) An allegation that is not essential to the statement of a claim or defense,” “(2) An allegation that is neither pertinent to nor supported by an otherwise sufficient claim or defense,” or “(3) A demand for judgment requesting relief not supported by the allegations of the complaint or cross-complaint.” (Code Civ. Proc., § 431.10.)

Punitive Damages

Defendants argue Futong failed to allege how the conduct giving rise to punitive damages was authorized or ratified by Ameri-Hua and Darwin Pacific’s officers. But it is unclear how Futong failed to do so when two of the Defendants involved in allegedly fraudulent transfers—Tao and Zeng—are alleged to be officers and shareholders of Ameri-Hua and Darwin Pacific. (Complaint, ¶ 4-5, 38-44; see Wilson v. Southern California Edison Co. (2015) 234 Cal.App.4th 123, 164 [“[T]he oppression, fraud, or malice must be perpetrated, authorized, or knowingly ratified by an officer, director, or managing agent of the corporation.”] (emphasis added).)

Accordingly, Defendants’ motion to strike on this ground is DENIED.

Attorney Fees

Defendants contend Futong’s request for attorney fees is improper because Futong failed to allege facts or provide evidence of a contractual provision that authorizes the award of attorney fees. Defendants, however, fail to provide any citation to authority that imposes this requirement beyond the general rules for when attorney fees can be awarded.

Accordingly, Defendants’ motion to strike on this ground is DENIED.

Insolvency Allegations

Defendants maintain Futong’s allegations that Ameri-Hua was insolvent after the alleged fraudulent transfer in this action are contradicted by the judicially noticeable fact that Ameri-Hua has been in good standing with the California Secretary of State since 2012. (Compare Complaint, ¶ 42, with Reply, RJN, Ex. 1.) Defendants fail to demonstrate how Ameri-Hua’s status as a corporation in good standing defeats Futong’s allegations. Moreover, this appears to be an inappropriate attempt to litigate the facts of this case. Accordingly, Defendants’ motion to strike on this ground is DENIED.

To the extent Futong alleges an entity named “Fame Luck” also became insolvent, the court GRANTS Defendants’ request to strike this allegation with leave to amend as Futong admits it was improperly added through a copy-and-past error. (See Complaint, ¶ 53.)

CONCLUSION

Based on the foregoing, Defendants’ motion to strike is GRANTED IN PART as to paragraph fifty-three of the Complaint with ten (10) days leave to amend and DENIED IN PART on all other grounds.