Judge: Steven A. Ellis, Case: 22STCV33581, Date: 2023-08-28 Tentative Ruling
Case Number: 22STCV33581 Hearing Date: April 15, 2024 Dept: 29
Motion for Summary Judgment, or in the Alternative
for Summary Adjudication, filed by Defendants IHG Management (Maryland) LLC and
Hanjin International Corp.
TENTATIVE
The
motion for summary judgment is denied.
The
motion for summary adjudication is denied as to the first, second, third,
fourth, and fifth causes of action in the First Amended Complaint.
The
motion for summary adjudication is granted as to the claim for punitive
damages.
Background
On October
20, 2020, according to the First Amended Complaint (the “FAC”), three
individuals assaulted and robbed at gunpoint Plaintiffs Jacqueline Duclos, Sumoya
Michael, and Jane Doe (a minor child) (collectively, “Plaintiffs”) while they
were staying in a guestroom of the InterContinental Hotel in downtown Los
Angeles. (FAC, ¶ 14.) Plaintiffs allege that the robbery was
“orchestrated” by and/or “perpetrated with the direct assistance of” Defendant Ronald Elie (“Elie”), who
was then a Director of Housekeeping of the hotel. (Id., ¶¶ 1, 7, 14.) Plaintiffs
also allege (among other things) that Elie, as a Director of Housekeeping, had
a keycard that allowed him to enter guest rooms, including Plaintiffs’ room;
that Elie was “cross-trained with respect to security protocols for the Hotel”;
and that Elie was able to advise the three men “of these protocols, furnish
them with a key to gain access to the Hotel lobby and avoid suspicion from
Hotel security.” (Id., ¶ 17-18, 22.)
On October 14, 2022,
Plaintiffs filed the Complaint in this action against Defendants Ronald Elie;
InterContinental Hotel Los Angeles Downtown; InterContinental Hotels Group, PLC;
Keehong Woo; Hajin International Corp; and Does 1-50, asserting causes of
action for (1) negligence, (2) negligent hiring, supervision, and
retention, (3) invasion of privacy, (4) negligent infliction of emotional
distress (“NIED”), and (5) Intentional Infliction of Emotional Distress
(“IIED”). Plaintiffs subsequently amended their complaint to
name Hanjin International Corporation as Doe 1; Jin Ho Lee as Doe 2; and IHG
Management (Maryland) LLC as Doe 3.
On May
11, 2023, Defendants IHG Management (Maryland) LLC (“IHGM”) and Hanjin
International Corp. (“Hanjin) demurred to the complaint. IHGM and Hanjin (collectively,
“Defendants”) also filed a motion to strike the claim for punitive damages. On
June 28, 2023, the Court overruled the demurrer and granted the motion to
strike, with leave to amend.
On July 28, 2023, Plaintiffs filed the FAC. In the FAC,
Plaintiffs assert the same five causes of action against the same defendants. On
August 29, Defendants filed a motion to strike the punitive damages allegations
in the FAC. On October 2, the Court denied the motion.
Defendants filed their Answer to the FAC on November 3,
2023.
On November
9, 2023, Defendants filed this motion for summary judgment or, in the
alternative, for summary adjudication. Plaintiff filed their opposition on March
25, and Defendants filed their reply on April 3.
On April
8, 2024, the motion came on for hearing. The Court addressed certain
preliminary, procedural issues with counsel and continued the motion to April
15.
Legal
Standard
“The purpose of the law of summary judgment
is to provide courts with a mechanism to cut through the parties’ pleadings in
order to determine whether, despite their allegations, trial is in fact
necessary to resolve their dispute.” (Aguilar v. Atlantic Richfield Co.
(2001) 25 Cal.4th 826, 843.) Code of Civil Procedure section 437c, subdivision
(c), “requires the trial judge to grant summary judgment if all the evidence
submitted, and ‘all inferences reasonably deducible from the evidence’ and
uncontradicted by other inferences or evidence, show that there is no triable
issue as to any material fact and that the moving party is entitled to judgment
as a matter of law.” (Adler v. Manor Healthcare Corp. (1992) 7
Cal.App.4th 1110, 1119.) “The function of the pleadings in a motion for summary
judgment is to delimit the scope of the issues; the function of the affidavits
or declarations is to disclose whether there is any triable issue of fact
within the issues delimited by the pleadings.” (Juge v. County of Sacramento
(1993) 12 Cal.App.4th 59, 67, citing FPI Development, Inc. v. Nakashima
(1991) 231 Cal.App.3d 367, 381-382.)
As to each cause of action as framed by the
complaint, a defendant moving for summary judgment or summary adjudication must
satisfy the initial burden of proof by presenting facts to show “that one or
more elements of the cause of action ... cannot be established, or that there
is a complete defense to the cause of action.” (Code Civ. Proc., § 437c, subd.
(p)(2); see also Aguilar, supra, 25 Cal.4th at pp. 850-851; Scalf
v. D. B. Log Homes, Inc. (2005) 128 Cal.App.4th 1510, 1520.) Once the
defendant has met that burden, the burden shifts to the plaintiff to show that
a “triable issue of one or more material facts exists as to the cause of action
or a defense thereto.” (Code Civ. Proc., § 437c, subd. (p)(2); see also Aguilar,
supra, 25 Cal.4th at pp. 850-851.)
A plaintiff or cross-complainant moving for
summary judgment or summary adjudication must satisfy the initial burden of
proof by presenting facts to show “that there is no defense to a cause of
action if that party has proved each element of the cause of action entitling
the party to judgment on the cause of action.” (Code Civ. Proc., § 437c, subd.
(p)(1).) Once the plaintiff or cross-complainant has met that burden, the
burden shift to the defendant or cross-defendant to show that a “triable issue
of one or more material facts exists as to the cause of action or a defense
thereto.” (Ibid.)
The party opposing a motion for summary
judgment or summary adjudication may not simply “rely upon the allegations or
denials of its pleadings” but must instead “set forth the specific facts
showing that a triable issue of material fact exists.” (Code Civ. Proc., §
437c, subds. (p)(1) & (p)(2). To establish a triable issue of material
fact, the party opposing the motion must produce substantial responsive
evidence. (Sangster v. Paetkau (1998) 68 Cal.App.4th 151, 166.)
Courts “liberally construe the evidence in
support of the party opposing summary judgment and resolve doubts concerning
the evidence in favor of that party.” (Dore v. Arnold Worldwide, Inc.
(2006) 39 Cal.4th 384, 389.)
Discussion
Defendants
move for summary judgment. In the alternative, Defendants move for summary
adjudication of each individual cause of action in the complaint and of the
claim for punitive damages. Defendants argue (in summary): (1) that they are
not derivatively liable for Elie’s wrongdoing under a theory of respondeat
superior because, as a matter of law, his actions were outside the scope of his
employment; (2) that they are not directly liable under a negligence theory (negligence,
NIED, negligent hiring supervision, and retention) because,
as a matter of law, they did not breach any duty owed to Plaintiffs; and (3)
that, as a matter of law, Plaintiffs cannot make the necessary showing to
recover punitive damages.
The
underlying facts are largely undisputed, at least for purposes of this motion
for summary judgment or summary adjudication. Hanjin owns the building in which
the InterContinental Hotel in downtown Los Angeles is located. (Defendants’
Statement of Undisputed Material Facts [“DSUMF”], No. 1.) IHGM manages the
hotel. (DSUMF, No. 1; Plaintiffs’ Statement of Additional Material Facts [“PSAMF”],
No. 26.) Under the terms of the hotel management agreement, Hanjin is the
employer of all hotel employees, except for the general manager. (DSUMF, No. 1;
PSAMF, No. 26; Samuels Decl., Exh. 9, at p.12.)
IHGM
hired Elie in January or February 2019. (DSUMF, No. 2; see also PSAMF, Nos. 30,
34.) Elie’s position was “Assistant Director of Housekeeping for Defendants.” (DSUMF,
No. 3; PSAMF, No. 34.) Elie was a manager and “second in command” in the department;
he had a master key care that allowed him access to all guest rooms within the
hotel. (PSAMF, No. 37.) His duties included accessing and inspecting guest
rooms. (PSAMF, No. 37.)
IHGM has
a “Background and Screening Policy” regarding processes for pre-employment
background checks for all candidates for employment with the hotel. (DSUMF, No.
12; PSAMF, Nos. 28, 75.) IHGM works with HireRight, a consumer reporting agency
(“CRA”), for background and pre-employment drug screening. (DSUMF, No. 13;
PSAMF, No. 28.)
HireRight
conducted a background check on Elie for IHGM. (DSUMF, No. 14.) The report,
which was limited to the past seven years, found no criminal records. (DSUMF,
Nos. 14-15.) IHGM paid $28.31 for the report. (PSAMF, No. 28.)
The
report from HireRight did not reveal that Elie in fact had a fairly extensive criminal
record. In addition to a series of misdemeanors and probation violations, Elie was
arrested for possession of nearly of kilogram of cocaine and convicted of a felony
violation of Health & Safety Code section 11351.5 in 1991; he was convicted
in 1998 for felony possession of a controlled substance with intent to
distribute under 21 U.S.C. section 841, subdivision (a)(1); he was convicted of
felony grand theft in 2002; he was convicted of felony identify theft under
Penal Code section 484E, subdivision (d), and felony being a felon in
possession of a firearm under then Penal Code section 12021, subdivision
(a)(1), in 2003. (PSAMF, No. 36; Palmer Decl., Exhs. 24-25.) The most recent of
these convictions was in 2003, approximately 16 years before IHGM hired Elie as
an employee of Hanjin.
IHGM admitted
in discovery that the “pre-hiring criminal background check [of Elie] generically
identified unspecified criminal activity that was more than seven (7) years
prior.” (PSAMF, No. 35; Palmer Decl., Exh. 23.)
Elie
submitted a resume that showed prior work experience in the hotel industry
starting in 2004, approximately a year after his 2003 convictions. (DSUMF, No. 16.)
He worked as a manager/executive housekeeper for the Westin Bonaventure from
2004 to 2018 and an executive housekeeper for Bear Springs Hotel in 2018.
(DSUMF, No. 17.) Prior to the incident involved in this litigation, Elie had no
disciplinary issues at the hotel. (DSUMF, No. 18.) Defendants did not conduct
any performance reviews of Elie during his employment. (PSAMF, Nos. 41, 72-73.)
Rachel
Chishty was employed by IHGM as the Human Resources Director from 2018 to 2022.
(PSAMF, No. 30.) Ms. Chisty was responsible for (among other things) all
background check functions. (PSAMF, No. 71.) Ms. Chishty did not direct the HR department
to search Los Angeles County court records for criminal cases or convictions of
Elie or other prospective employees. (PSAMF, No. 32.) Ms. Chishty testified
that had she known about Elie’s criminal history, she would not have hired
Elie. (PSAMF, No. 33.)
IHGM is
aware of the risk of crime in the hotel and trains employees and staff that
hotel guests are vulnerable to crime in their rooms. (PSAMF, Nos. 38, 40.) IHGM
trains its employees that confidential guest information can be used by
criminals to commit crimes against guests. (PSAMF, No. 61.) IHGM’s policies prohibit
employees from accessing personal data of guests, revealing confidential
information to unauthorized persons, soliciting “for immoral purposes,” or
aiding and abetting of such. (PSAMF, Nos. 62-63, 69.) An IHGM manual states, “hotel
guest expectations of security are at their highest when they are in the guest
room and therefore security incidents that occur in guest rooms are likely to
cause guests particular stress and are most likely to trigger liability claims
against the hotel.” (PSAMF, No. 67.)
Prior to
the robbery, Elie accessed Plaintiffs’ room on two occasions, including just a
few hours in advance of the incident. (PSAMF, Nos. 44-45.) This was in
violation of IHGM’s Confidentiality and Privacy Policy, which prohibits employees
from entering guest rooms without the consent of the guests. (PSAMD, No. 43.)
Elie was
aware of the hotel’s security protocols and used this knowledge to orchestrate
the plan of robbing Plaintiffs. (PSAMF, No. 46.)
Elie met
the three robbers when they arrived, supplied them with a keycard to allow them
access to the hotel, guided them to use a particular bank of elevators that
provided a direct path to Plaintiffs’ guest room and traveled with them to the
58th floor. (PSAMF, Nos. 47-53.) The three robbers entered Plaintiffs’ room and
terrorized Plaintiffs, dragging one by the hair and holding guns to their heads.
(DSUMF, No. 4; PSAMF, No. 54.) One robber threatened to kill them; one held up a
firearm and counted backward from five. (PSAMF, No. 55.)
The
robbers tied one of the Plaintiff’s hands together, stole both adults’ cell
phones, money, and other property. The adults were frightened and believed they
were about to be murdered (PSAMF, No. 56.)
Elie
then helped the robbers escape. (PSAMF, Nos. 57-60.)
IHGM investigated
and terminated Elie on December 4, 2020. (DSUMF, No. 7; PSAMF, No. 64.) He was
charged criminally and found guilty of two counts of felony robberty and one
county or felony burglary. (PSAMF, No. 65.) Defendants admit that Elie aided
and abetted the robbery of Plaintiffs. (PSAMF, No. 42.)
Respondeat
Superior Liability
Defendants
move for summary adjudication of Plaintiffs’ causes of action for negligence
(first cause of action), invasion of privacy (third), NIED (fourth), and IIED
(fifth) on the ground that they are not vicariously liable for the actions of
Elie because, as a matter of law, Elie was not acting within the scope of his
employment when he committed the torts and Defendants did not ratify his
conduct.
The law regarding respondeat superior
liability is well established in California.
A “principal is responsible to third persons for the negligence of his
agent in the transaction of the business of the agency, including wrongful acts
committed by such agent in and as part of the transaction of such business.” (Civ.
Code, § 2338.) “[A]n employer is vicariously liable for the torts of its
employees committed within the scope of employment.” (Lisa M. v. Henry Mayo
Newhall Memorial Hospital (1995) 12 Cal.4th 291, 296.) “The respondeat
superior doctrine makes an employer liable, irrespective of fault, for an
employee’s tortious conduct in the scope of employment.” (Diaz v. Carcamo (2011)
51 Cal.4th 1148, 1154.)
For
more than 50 years, courts in California have based respondeat superior
liability not on a theory of control by the employer but rather on the
allocation of risk: a business is responsible for the costs associated with the
business operations, including the tortious conduct of its employees that is
“typical or or broadly incidental to the enterprise [the employer] has
undertaken,” the “more or less inevitable toll of a lawful enterprise.” (Hinman v. Westinghouse Elec. Co.
(1970) 2 Cal.3d 956, 960.) The “risks inherent in or created by the enterprise”
are properly born by the employer, particularly when the employee who committed
the tort “was on company time and was engaged in the very conduct contemplated
by the employer.” (Ibid.; see also, e.g., Carr v. Wm C. Crowell Co.
(1946) 28 Cal.2d 652, 655-656 [referring to the “risks of the enterprise”].)
In
determining the scope of employment, the California Supreme Court has adopted
and repeatedly relied on a standard set forth by the Court of Appeal in Rodgers
v. Kemper Construction Co. (1975) 50 Cal.App.3d 608, 618-619:
One
way to determine whether a risk is inherent in, or created by, an enterprise is
to ask whether the actual occurrence was a generally foreseeable consequence of
the activity. However, “foreseeability” in this context must be distinguished
from “foreseeability” as a test for negligence.
In the latter sense, “foreseeable” means a level of probability which
would lead a prudent person to take effective precautions whereas
“foreseeability” as a test for respondeat superior merely means that in the
context of the particular enterprise an employee’s conduct is not so unusual or
startling that it would seem unfair to include the less resulting from it among
other costs of the employer’s business. … In other words, where the question is
one of vicarious liability, the inquiry should be whether the risk was one that
may fairly be regarded as typical of or broadly incidental to the enterprise
undertaken by the employer.
(See,
e.g., Lisa M., supra, 12 Cal.4th at p. 299 [quoting Rodgers]; Farmers
Ins. Group v. County of Santa Clara (1995) 11 Cal.4th 992, 1004 [same]; Mary
M. v. City of Los Angeles (1991) 54 Cal.3d 202, 209 [same]; see also CACI
No. 3720 (stating that conduct is within the scope of employment if it is
“reasonably related to the kinds of tasks that the [employee] was employed to
perform” or “reasonably foreseeable in light of the employer’s business or the
[employee’s] responsibilities.”)
“[A]n
employee’s willful, malicious and even criminal torts may fall within the scope
of his or her employment for purposes of respondeat superior, even though the
employer has not authorized the employee to commit crimes or intentional
torts.” (Lisa M., supra, 12 Cal.4th at pp, 296-297; see, e.g., Mary
M., supra, 54 Cal.3d at p. 209; Carr, supra, 28 Cal.2d at pp.
654-656.)
Employers
are not, however, liable for all torts, and certainly not all intentional torts,
committed by employees during working hours. “If an employee inflicts an injury out of personal malice, not
engendered by the employment, the employer is not liable.” (Carr, supra, 28
Cal.2d at pp. 656-657; see, e.g., Perry v. County of Fresno (2013) 215 Cal.App.4th
94, 101-105.) Applying this principle, courts have frequently held that employers
are not liable for sexual assaults or other sexual misconduct committed by
employees. (E.g., Lisa M., supra, 12 Cal.4th at pp. 300-304; Federico
v. Super. Ct. (1997) 59 Cal.App.4th 1207; Alma W. v. Oakland Unified
Sch. Dist. (1981) 123 Cal.App.3d 133; but see Mary M., supra, 54
Cal.3d at pp. 217-218.)
Plaintiffs have the burden of proving that
“the employee’s tortious conduct was committed within the scope of employment.”
(Mary M. v. City of Los Angeles (1991) 54 Cal.3d 202, 209; accord Ducey
v. Argo Sales Co. (1979) 25 Cal.3d 707, 721; Moreno v. Visser Ranch,
Inc. (2018) 30 Cal.App.5th 568, 576.) “Ordinarily, the determination
whether an employee has acted within the scope of employment presents a
question of fact; it becomes a question of law, however, when the facts are
undisputed and no conflicting inferences are possible.” Lisa M., supra, 12 Cal.4th at p. 299.)
In their motion, Defendants argue that the
undisputed facts establish that Elie’s intentional, criminal conduct, which
involved an extensive amount of planning with his three co-conspirators, was
not foreseeable from Elie’s duties, was not “engendered by the employment,” and
therefore was not, as a matter of law, within the course and scope of Elie’s employment
with Defendants. Defendants argue that this case is similar to Perry v.
County of Fresno, supra, in which the employer was not held liable for the
intentional torts committed by its employee. In Perry, the dispute
between plaintiff and defendant’s employee was entirely personal and had not
connection to the employment: plaintiff and the employee had been involved in a
non-work related automobile accident. (215 Cal.App.4th at p. 102.) The employee
then improperly accessed and used employer resources in an attempt to
intimidate or persuade the plaintiff to drop the personal injury claim. (Ibid.)
As the Court of Appeal reasoned:
The
motivation behind this scheme was not generated by, or an outgrowth of,
workplace responsibilities, conditions, or events. Rather, [the employee’s]
endeavor was purely personal. Accordingly, [the employee’s] wrongful tort was
outside the scope of his employment.
(Ibid.)
Here, however,
in contrast to Perry, this is not a case in which Elie merely accessed
and misused the resources of Defendants to obtain leverage or some other advantage
against Plaintiffs in a pre-existing personal dispute. Rather, as was the case
in Carr, supra, in which the California Supreme Court held that respondeat
superior applied, the entire relationship between Elie and Plaintiffs arose out
of Elie’s employment, and there is no evidence that Elie had any dispute with
Plaintiffs, or had any relationship at all with Plaintiffs, prior to the intentional
torts at issue. (28 Cal.2d at
p. 657.)
As noted above, the fundamental test for respondeat superior
liability is whether the risk “was one that may fairly be regarded as typical
of or broadly incidental to the enterprise undertaken by the employer.” (Lisa M., supra, 12 Cal.4th at p. 299.) Here, there is
evidence in the record that would support a determination by the trier of fact
that the risk of intentional torts, including invasions of privacy, theft, and
other crimes, is “typical” or “broadly incidental” to the enterprise of running
of a hotel. Indeed, there is evidence that Defendants were aware of such risks
and specifically trained their employees regarding those risks and how to
protect the hotel’s guests. (See PSAMF,
Nos. 38, 40, 61-63, 67, 69.) Although the particular facts of this case are
particularly heinous, the trier of fact could reasonably find that the risk
that hotel employees or third parties would commit crimes (including crimes of
violence and property crimes) against hotel guests is, in this context,
entirely foreseeable.
On this
record, this are sufficient facts showing a nexus between Elie’s torts and his
employment to support a finding by the trier of fact that Elie’s conduct fell
within the scope of his employment with Defendants. Accordingly, Defendants have
not met their initial burden of showing, on a motion for summary judgment or
summary adjudication, “that one
or more elements of [Plaintiffs’] cause of action ... cannot be established, or
that there is a complete defense to the cause of action.” (Code Civ. Proc., §
437c, subd. (p)(2).)
Defendants’ motion for summary adjudication as
to the first, third, fourth, and fifth causes of action is DENIED.
Direct Liability
Defendants
move for summary adjudication of Plaintiffs’ cause of action for negligent hiring,
supervision, and retention (second cause of action) on the ground that the
undisputed facts show that they were not on notice of any instances of similar
conduct by Elie prior to the subject robbery and that therefore, as a matter of
law, they did not breach any duty to Plaintiffs in hiring, supervising, and
retaining Elie.
“California
law recognizes the theory that an employer can be held liable to a third person
for negligently hiring, supervising, or retaining an unfit employee.” (Doe
v. Capital Cities (1996) 50 Cal.App.4th 1038, 1054.) “Negligence liability
will be imposed on an employer if it knew or should have known that hiring the
employee created a particular risk or hazard and that particular harm
materializes.” (Phillips v. TLC Plumbing (2009) 172 Cal.App.4tha 1133,
1139; see also CACI No. 426.)
Defendants
argue that they did not breach any duty owed to Plaintiff: to the contrary,
they performed a background check with the assistance of a third party and
discovered no criminal convictions in the prior seven years, the maximum time
period that a report from a consumer reporting agency can cover. Having
conducted a rigorous and extensive background check that did not reveal any
concerns, Defendants argue, as a matter of law they did not breach any duty to
Plaintiffs in hiring Elie.
But there is more to the story, based on the evidence in the
record. Defendants admitted in discovery that their background check of Elie “generically
identified unspecified criminal activity that was more than seven (7) years
prior.” (PSAMF, No. 35; Palmer Decl., Exh. 23.) A trier of fact could reasonably
find that given that this information was actually known to Defendants prior to
their decision to hire Elie, Defendants breached their duty of care by failing
to take any further steps to inquire about or investigate Elie’s criminal
history. That investigation, if it had been conducted, could have revealed
(through public records), several felony convictions of Elie between 1998 and
2003. (PSAMF, No. 36; Palmer Decl., Exhs. 24-25.)
The
Court recognizes that the most recent of these convictions was in 2003,
approximately 16 years before Defendants hired Elie. The Court also recognizes
that in the intervening years, Elie had worked extensively in the hospitality
industry, including approximately 14 years at the Westin Bonaventure. (DSUMF,
Nos. 16-17.) A jury might well find that Defendants did not breach their duty
of care by hiring Elie under these circumstances. But the Court cannot, on this
record, conclude that the jury would be required to make such a finding of no
breach as a matter of law. Indeed, Defendants’ Human Resources Director Rachel
Chishty testified that had she known of the full extent of Elie’s criminal
history, she would not have hired Elie. (PSAMF, No. 33.) On this record, the issue
of breach is a question of fact for the jury, not a question that can be
decided as a matter of law by the Court.
Defendants
have not met their initial burden of showing, on a motion for summary judgment
or summary adjudication, “that
one or more elements of [Plaintiffs’] cause of action ... cannot be
established, or that there is a complete defense to the cause of action.” (Code
Civ. Proc., § 437c, subd. (p)(2).) Accordingly, Defendants’ motion for summary
adjudication as to the second cause of action is DENIED.
Punitive
Damages
To recover punitive damages
under Civil Code section 3294, a plaintiff must show by clear and convincing evidence
that the defendant that the defendant has been guilty of malice, oppression or fraud.
“Malice” is defined in section
3294, subdivision (c)(1), as “conduct which is intended by the defendant to
cause injury” or “despicable conduct which is carried on by the defendant with
a willful and conscious disregard of the rights or safety of others.”
“Oppression” is defined in
section 3294, subdivision (c)(2), as “despicable conduct subjecting a person to
cruel and unjust hardship in conscious disregard of that person’s rights.”
“Fraud” is defined in section
3294, subdivision (c)(3), as “an
intentional misrepresentation, deceit, or concealment of a material fact known
to the defendant with the intention on the part of the defendant of thereby
depriving a person of property or legal rights or otherwise causing injury.”
The term “despicable conduct,” as used in subdivisions (c)(1) and
(c)(2), has been defined in the case
law as actions that are “base,” “vile,” or “contemptible.” (See, e.g., College Hosp., Inc. v. Super. Ct. (1994) 8 Cal.4th 704, 725;
Shade Foods, Inc. v. Innovative Products Sales
& Marketing, Inc. (2000) 78 Cal. App.
4th 847, 891; see also CACI 3940 [“Despicable conduct is conduct that is
so vile, base, or contemptible that it would be looked down on and despised by
reasonable people.”].)
Evidence of negligence, gross negligence, or even recklessness is
not sufficient. (Dawes v. Super. Ct. (1980) 111 Cal. App. 3d 82, 87.)
Rather, a plaintiff must prove that the defendant intended to cause harm to
plaintiff or “acted in such an outrageous and reprehensible manner that the
jury could infer that [the defendant] knowingly disregarded the substantial
certainty of injury to others.” (Id. at p. 90; see also, e.g., American Airlines, Inc. v. Sheppard,
Mullin, Richter & Hampton (2002) 96 Cal.App.4th 1017.).
“An
employer shall not be liable for [punitive] damages ... based upon acts of an
employee of the employer, unless the employer had advance knowledge of the
unfitness of the employee and employed him or her with a conscious disregard of
the rights or safety of others or authorized or ratified the wrongful conduct...
or was personally guilty of oppression, fraud or malice. With respect to a
corporate employer, the advance knowledge and conscious disregard,
authorization, [or] ratification ... must be on the part of an officer,
director, or managing agent of the corporation.”¿(Civ. Code, § 3294, subd. (b).)
A managing agent, in this context, is “someone who¿‘exercise[s] substantial
discretionary authority over decisions that ultimately determine corporate
policy.’” (White v. Ultramar, Inc.¿(1999) 21 Cal.4th 563, 577; see also CACI
Nos. 3943, 3944.)¿
While
“the ‘clear and convincing’ evidentiary standard is a stringent one, it does
not impose on a plaintiff the obligation to ‘prove’ a case for punitive damages
at summary judgment.” (Spinks v. Equity Residential Briarwood Apartments (2009)
171 Cal.App.4th 1004, 1053.) However, where the plaintiff's ultimate burden of
proof will be by clear and convincing evidence, the higher standard of proof
must be taken into account in ruling on a motion for summary judgment or
summary adjudication, since if a plaintiff is to prevail on a claim for
punitive damages, it will be necessary that the evidence presented meet the
higher evidentiary standard. (Basich v. Allstate Ins. Co. (2001) 87
Cal.App.4th 1112, 1118–1120, 105 Cal.Rptr.2d 153.)¿Summary judgment “on the
issue of punitive damages is proper” only “when no reasonable jury could find
the plaintiff’s evidence to be clear and convincing proof of malice, fraud or
oppression.” (Id.)¿
Here, there is not sufficient
evidence in the record to support a reasonable determination by the trier of
fact, under the clear and convincing evidence standard, that Defendants (or
either of them) were guilty of malice, oppression, or fraud. The Court has
determined, above, that there is a triable issue as to whether Defendants were
negligent in hiring Elie, but there is quite a distance between proving
negligence by a preponderance of the evidence and proving malice, oppression,
or fraud by clear and convincing evidence. A jury might reasonably find that
Defendants made a mistake (i.e., were negligent) in hiring Elie, and in doing
so violated their duty of care to Plaintiffs, given what they knew or should
have known. But the decision to hire Elie, who had not been convicted of any crime
in the 16 years prior to the hiring decision, and who had spent 14 of those
years working (apparently without any incident) in the hospitality business for
another prominent hotel in downtown Los Angeles, could not, on this record,
support a finding by clear and convincing evidence that Defendants (or either
of them) actually intended to harm Plaintiffs, engaged in despicable conduct in
conscious disregard for the rights or safety of Plaintiffs, or otherwise are
liable for punitive damages arising out of this incident.
Defendants have met their initial burden of presenting
facts that show, as a matter of law, that Plaintiffs cannot establish a
sufficient basis for an award of punitive damages. Plaintiffs have not shown
that there is a triable issue on the punitive damages claim. Accordingly, Defendants’
motion for summary adjudication as to Plaintiffs’ claim for punitive damages
against them is GRANTED.
Conclusion
The Court
DENIES Defendants’ motion for summary judgment.
The Court DENIES Defendants’ motion for summary adjudication as to
each of the first, second, third, fourth, and fifth causes of action in the
FAC.
The Court GRANTS Defendants’ motion for summary adjudication as to
the claim for punitive damages against them.
Moving
Party is to give notice.