Judge: Stephen P. Pfahler, Case: 21STCV28908, Date: 2022-09-30 Tentative Ruling

Case Number: 21STCV28908    Hearing Date: September 30, 2022    Dept: F49

Dept. F-49

Date: 9-30-22

Case #21STCV28908

Trial Date: Not Set

 

DEMURRER

 

MOVING PARTY: Defendant, Distinct Cars, LLC

RESPONDING PARTY: Plaintiffs, Rose Moroso, et al.

 

RELIEF REQUESTED

Demurrer to the Second Amended Complaint

·         1st Cause of Action: Negligence

·         5th Cause of Action: Survival Action

 

Motion to Strike Allegations in Support of, and Claim for, Punitive Damages

 

Joinder of Rideshare Car Rentals, LLC

 

SUMMARY OF ACTION

On June 24, 2021, a 2020 Ford Transit van owned by defendant Distinct Cars, LLC and operated by defendant Jacob Sanchez collided with motorcycle ridden by Lawrence Moroso. The incident occurred on The Old Road in Newhall, California. Lawrence died as a result of the injuries. Plaintiffs allege Jacob Sanchez was operating the vehicle on behalf of employer, defendant Newegg.

 

On August 5, 2021, Plaintiffs filed a complaint for Negligence, Negligent Hiring, Negligent Entrustment, Negligent Supervision, and Survival Action. On September 9, 2021, Distinct Cars answered the complaint. On September 17, 2021, Newegg Logistic Services answered the complaint and filed a cross-complaint against PDQ Pickup, LLC, for Express Indemnity, Breach of Contract (Duty to Defend), Equitable Comparative Indemnity, Declaratory Relief, Duty to Indemnify, and Declaratory Relief for Duty to Defend. On September 17, 2021, Distinct Cars, LLC filed a cross-complaint against PDQ Pickup, LLC, PDQ Rideshare Rentals, and Rideshare Rentals, Inc. for Implied Indemnity, Contribution and Indemnity, Declaratory Relief, Express Indemnity, and Negligence.

 

On December 8, 2021, the court (Department 32) granted the motion to strike brought by Newegg, Inc. Plaintiffs filed their first amended complaint for Negligence, Negligent Hiring, Negligent Entrustment, Negligent Supervision, and Survival Action on January 3, 2022. On February 2, 2022, the court entered the stipulation of the parties to file the second amended complaint. Plaintiffs filed their second amended complaint for Negligence, Negligent Hiring, Negligent Entrustment, Negligent Supervision, and Survival Action on February 16, 2022.

 

The second amended complaint adds additional allegations regarding the added defendants, as well as new factual claims regarding the existence of a Netradyne dashboard or windshield mounted camera and communication system which monitors vehicle operations, tracks positioning, and provides on board video traffic surveillance as well as other safety features for the vehicle operator. Plaintiffs allege Jacob Sanchez intentionally covered the camera lens(es) prior to the time of the collision. Plaintiff also alleges Jacob Sanchez was convicted for a number of prior traffic infractions, and disposed of “evidence” following the collision prior to the arrival of the police department, thereby delaying the provision of care of Lawrence Moroso.

 

On May 5, 2022, the action was transferred to Department 49.

 

RULING

Demurrer: Sustained with Leave to Amend.

Request for Judicial Notice: Granted.

The court can take judicial notice of out of district case law for purposes of considering persuasive authority.

 

Defendant Distinct Cars, LLC (“Distinct Cars”) brings the subject demurrer to the first and fifth causes of action for negligence and survival action in the second amended complaint on grounds of uncertainty and insufficient legal basis of support. Distinct Cars contends the plain language of the operative complaint only supports an indirect rental relationship without a basis of liability above and beyond federal statutory protections. Plaintiff in opposition counters that the negligence and survival actions are well pled against Distinct Cars based on both extensive citation to the operative complaint, and an argument that the operative complaint alleges a claim for “direct” negligence, thereby exempting federal statutory preemption. Plaintiffs alternatively seek leave to amend. Distinct Cars in reply denies any claims involving direct liability.

 

A demurrer is an objection to a pleading, the grounds for which are apparent from either the face of the complaint or a matter of which the court may take judicial notice. (Code Civ. Proc., § 430.30, subd. (a); see also Blank v. Kirwan (1985) 39 Cal.3d 311, 318.) The purpose of a demurrer is to challenge the sufficiency of a pleading “by raising questions of law.” (Postley v. Harvey (1984) 153 Cal.App.3d 280, 286.) “In the construction of a pleading, for the purpose of determining its effect, its allegations must be liberally construed, with a view to substantial justice between the parties.” (Code Civ. Proc., § 452.) The court “ ‘ “treat[s] the demurrer as admitting all material facts properly pleaded, but not contentions, deductions or conclusions of fact or law . . . .” ’ ” (Berkley v. Dowds (2007) 152 Cal.App.4th 518, 525.) In applying these standards, the court liberally construes the complaint to determine whether a cause of action has been stated.  (Picton v. Anderson Union High School Dist. (1996) 50 Cal.App.4th 726, 733.

 

“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; Williams v. Beechnut Nutrition Corp. (1986) 185 Cal.App.3d 135, 139 [“[U]nder our liberal pleading rules, where the complaint contains substantive factual allegations sufficiently apprising defendant of the issues it is being asked to meet, a demurrer for uncertainty should be overruled or plaintiff given leave to amend.]

 

1st Cause of Action: Negligence

Distinct Cars contends federal law preempts any claims based on negligent operation of a vehicle simply based on ownership liability. The relied upon section provides:

 

(a) In general -- An owner of a motor vehicle that rents or leases the vehicle to a person (or an affiliate of the owner) shall not be liable under the law of any State or political subdivision thereof, by reason of being the owner of the vehicle (or an affiliate of the owner), for harm to persons or property that results or arises out of the use, operation, or possession of the vehicle during the period of the rental or lease, if--

(1) the owner (or an affiliate of the owner) is engaged in the trade or business of renting or leasing motor vehicles; and

(2) there is no negligence or criminal wrongdoing on the part of the owner (or an affiliate of the owner).

(b) Financial responsibility laws.--Nothing in this section supersedes the law of any State or political subdivision thereof--

(1) imposing financial responsibility or insurance standards on the owner of a motor vehicle for the privilege of registering and operating a motor vehicle; or

(2) imposing liability on business entities engaged in the trade or business of renting or leasing motor vehicles for failure to meet the financial responsibility or liability insurance requirements under State law.

(c) Applicability and effective date – Notwithstanding any other provision of law, this section shall apply with respect to any action commenced on or after the date of enactment of this section without regard to whether the harm that is the subject of the action, or the conduct that caused the harm, occurred before such date of enactment.

(d) Definitions.--In this section, the following definitions apply:

(1) Affiliate.--The term “affiliate” means a person other than the owner that directly or indirectly controls, is controlled by, or is under common control with the owner. In the preceding sentence, the term “control” means the power to direct the management and policies of a person whether through ownership of voting securities or otherwise.

(2) Owner.--The term “owner” means a person who is--

(A) a record or beneficial owner, holder of title, lessor, or lessee of a motor vehicle;

(B) entitled to the use and possession of a motor vehicle subject to a security interest in another person; or

(C) a lessor, lessee, or a bailee of a motor vehicle, in the trade or business of renting or leasing motor vehicles, having the use or possession thereof, under a lease, bailment, or otherwise.

(3) Person.--The term “person” means any individual, corporation, company, limited liability company, trust, association, firm, partnership, society, joint stock company, or any other entity.

 

49 U.S.C.A. § 30106

 

The court accepts the representation of Distinct Cars regarding the lack of any state or Ninth Circuit authority interpreting the statute, thereby allowing the court to consider the federal authority on a persuasive basis. “[T]he decisions of the lower federal courts, while persuasive, are not binding on us. (Citation.) Thus, in the absence of a controlling United States Supreme Court [or California Supreme Court] opinion, we make an independent determination of federal law. … In short, the presence or absence of a decision by the Ninth Circuit on this issue is not determinative.” (Forsyth v. Jones (1997) 57 Cal.App.4th 776, 782–783; Thurston v. Midvale Corp. (2019) 39 Cal.App.5th 634, 640.)

 

Plaintiffs allege Distinct Cars’ status as the owner of the van, and rental agency operator. [Sec. Amend. Comp., ¶¶ 46-47.] The parties agree that the plain language of the statute preempts any claims against a rental car agency liability based simply on the provision of a vehicle without further control of the vehicle or operator (e.g. no negligence or criminal wrongdoing). (49 U.S.C.A. § 30106(a)(2).) The court finds the Federal Circuit authority interpreting the statute persuasive as well, and agrees with the preemptive effect on negligence claims arising simply from ownership of a vehicle without any further undertaking of duty to insure the safe operation of the vehicle via driver vetting or vehicle controls. (Carton v. General Motor Acceptance Corp. (8th Cir. 2010) 611 F.3d 451, 457; Garcia v. Vanguard Car Rental USA, Inc. (11th Cir. 2008) 540 F.3d 1242, 1249.)

Notwithstanding the allegations of the operative complaint identifying Distinct Cars as a rental car agency, Plaintiffs specifically seek an exemption to any federal statutory preemption. Plaintiffs specifically rely on allegations in the second amended complaint regarding the existence of the Netradyne camera system for purposes of both monitoring vehicle driver operations, and enhance safety features during vehicle operations. While it’s not clear from the allegations in the operative complaint who was responsible for placement of the camera and/or monitoring systems into the van, Plaintiffs specifically allege that Newegg, Inc. and/or Newegg Logistic Services, Inc. maintained access to van operations, including (the) camera(s) and other vehicle operations monitoring information [Sec. Amend. Comp., ¶¶ 28-29, 31-34,39-40].  The Newegg entities additionally required the driver to upload a their drivers license in order to confirm driver and vehicle assignments [Sec. Amend. Comp., ¶¶ 30]. While Plaintiffs detail the Newegg defendants’ data access and management system control, Plaintiffs seek to render certain co-defendants liable under a general agency claim. The allegation arise in alleged course of conduct undertaken to monitor the safe operation of the vehicle, including rental agency Distinct Cars. [Sec. Amend. Comp., ¶¶ 51, 56-61, 68.]

 

The court accepts the truth of the allegations as required under the demurrer standard. However, in considering the factual context of the allegations regarding the role of the Newegg entities in the specific monitoring of van operations including the alleged disregard of the alarm system when Jacob Sanchez covered the camera and inhibited surveillance, the simple conclusive statements regarding a vicarious liability theory of involvement by multiple other entities insufficiently supports any factual basis of direct negligence or a willful violation of the identified vehicle operation laws against Distinct Cars. Allegations of agency liability without supporting circumstance as to how any and all of the other entities were granted access to the data and a basis of control and/or ratification of the allegedly wrongful conduct of Jacob Sanchez, will not support the continued prosecution of a claim against an entity otherwise admittedly protected by federal law.

 

The court acknowledges the argument of Distinct Cars seeking a ruling of sustained without leave to amend. This is the first consideration of the action before this court, and the first demurrer heard by any court. The court finds Plaintiff is entitled to seek a potential agency theory of liability and/or otherwise plead facts regarding the allegedly negligent or criminal conduct of Distinct Cars. The court therefore sustains the demurrer with 30 days leave to amend.

 

5th Cause of Action: Survival Action                                                 

To the extent the survival cause of action depends on the negligence cause of action, the demurrer is also sustained with leave to amend.

 

The demurrer is therefore sustained with leave to the first and fifth causes of action. Plaintiffs are granted 30 days leave to amend. Plaintiffs may only add facts and theories of liability in support of the pled claims, including the agency claims. Plaintiff may NOT add any new causes of action. (Harris v. Wachovia Mortgage, FSB (2010) 185 Cal.App.4th 1018, 1023.) If Plaintiffs add any new claims without leave of court, Defendants may bring a motion to strike on these items.

 

Motion to Strike: MOOT.

 

Distinct Cars to provide notice to ALL parties.