Judge: Teresa A. Beaudet, Case: 24STCV02051, Date: 2024-08-09 Tentative Ruling

Case Number: 24STCV02051    Hearing Date: August 9, 2024    Dept: 50

Superior Court of California

County of Los Angeles

Department 50

Background

            Plaintiffs Nancy Lepe Moran (“Moran”) and Luis Castro (“Castro”) (jointly, “Plaintiffs”) filed this action on January 26, 2024 against Defendants IGS Solutions, LLC, Stiiizy, LLC, Shryne Group, Inc., Rachel Apodacha, and Paul Ahn. The Complaint alleges twenty-one causes of action.

            IGS Solutions, LLC, Stiiizy IP LLC (erroneously sued as Stiiizy, LLC) and Shryne Group, Inc. (collectively, “Defendants”) now demur to the first, third, sixth, seventh, eighth, eleventh, and twelfth causes of action of the Complaint. Plaintiffs oppose.

Discussion

A.    Legal Standard

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.)

B.     Allegations of the Complaint  

In the Complaint, Plaintiffs allege that “Defendants provide various services, including, as relevant to Plaintiffs, sale and distribution of cannabis and related products. Such services are provided through IGS and, without limitation, its managers, supervisors, and agents thereof.” (Compl., ¶ 11.) “Nancy Lepe Moran…started working as an employee for Defendants in or around January 2022 through a 3rd party agency. She was then transitioned to direct, non-exempt employment with Defendants in or around April 2022, and, at the relevant time period herein, was working at the IGS location at 718 E Commercial Street, Los Angeles, CA 90012.” (Compl., ¶ 14.) “Plaintiff Luis Castro…was hired by Defendants in or around February 2022, and worked at the same location as Ms. Moran.” (Compl., ¶ 15.) “Plaintiffs Moran and Castro were unmarried partners, residing together. Defendants hired Ms. Moran and Mr. Castro with the advance knowledge that they were unmarried partners.” (Compl., ¶ 16.)

Plaintiffs allege that “Ms. Moran suffered an industrial injury in or about May 2022, when she slipped at work causing injuries to her knee. She thereafter returned to work with restrictions. During the period of time in which she was working with restrictions, Defendants routinely forced her to undertake work that was outside the scope of her restrictions. Defendants were hostile towards her, and treated her disparately from other non-injured employees. Defendants also reduced her hours. This went on until approximately September 2022, when she underwent arthroscopic knee surgery to fix the torn meniscus that she suffered as part of her industrial injury.” (Compl., ¶ 18.)

Plaintiffs allege that “[t]hereafter, shortly after her return to work from arthroscopic knee surgery, Ms. Moran was approached by her supervisor and told that either she or her partner, Mr. Castro, needed to resign from the Company. Ms. Moran was blindsided by the request, and when she protested as to why, her supervisor told her that Defendants had a policy that unmarried persons were not allowed to be coworkers, and that she and Mr. Castro were violating that policy. Ms. Moran complained and further protested that such a policy was unfair, that she was being mistreated for her and Mr. Castro’s decision to remain unmarried, and that she and Mr. Castro were both hired with the knowledge that they were in an unmarried partnership with one another. Defendants did not care, and terminated both Ms. Moran and Mr. Castro.” (Compl., ¶ 19.) Plaintiffs allege that “[p]rior to her termination, Ms. Moran was also the subject of unwanted sexual harassment from Defendant Paul Ahn. Such sexual harassment, along with retaliation from Defendants for rebuffing the harassment, continued through the date of her and Mr. Castro’s termination.” (Compl., ¶ 20.)

Plaintiffs further allege that “[t]hroughout Plaintiffs’ employment, Defendants regularly failed to provide Plaintiffs with a ten-minute, duty-free rest break for every four hours or major fraction thereof worked during a workday. On days that Plaintiffs were able to take a rest break, such breaks were also frequently interrupted or curtailed.” (Compl., ¶ 25.) “Employer Defendants regularly failed to provide Plaintiffs with a thirty-minute duty-free meal break within the first five hours in a workday.” (Compl., ¶ 26.) “Employer Defendants also failed to pay all waged owed by their termination date.” (Compl., ¶ 28.)

C.     Seventh Cause of Action for Sexual Harassment (Quid Pro Quo)

Defendants first assert that Moran’s seventh cause of action is insufficient. “California case law recognizes two theories upon which sexual harassment may be alleged. The first is quid pro quo harassment, where a term of employment is conditioned upon submission to unwelcome sexual advances. The second is hostile work environment, where the harassment is sufficiently pervasive so as to alter the conditions of employment and create an abusive work environment.” (Mogilefsky v. Superior Court (1993) 20 Cal.App.4th 1409, 1414.)

Defendants assert that “the Complaint does not allege any facts regarding the nature or circumstances of any alleged sexual harassment or misconduct by Defendant Paul Ahn…On its face, there is not a single act, remark, or expressed statement described to support this cause of action.” (Demurrer at p. 5:24-27.) Indeed, as set forth above, Plaintiffs allege that “Ms. Moran was also the subject of unwanted sexual harassment from Defendant Paul Ahn.” (Compl., ¶ 20.) However, as noted by Defendants, the Complaint does not appear to contain any specific factual allegations beyond this conclusory claim.

Defendants also assert that “Plaintiff fails to establish that a concrete employment benefit was conditioned on the acceptance of unwanted advances.” (Demurrer at p. 6:6-7.) Indeed, the Complaint does not appear to contain any factual allegations concerning a term of employment that “was expressly or impliedly conditioned upon acceptance of a supervisor’s unwelcome sexual advances. (Mogilefsky v. Superior Court, supra, 20 Cal.App.4th at p. 1414.) Rather, Plaintiffs allege in a conclusory fashion that “[t]he terms of Plaintiff’s employment, job benefits, or favorable working conditions were made contingent, by Defendants’ words or conduct, on Plaintiff’s acceptance of Defendants’ unwanted sexual advances and conduct.” (Compl., ¶ 125.)

            Based on the foregoing, the Court sustains Defendants’ demurrer to the seventh cause of action.

D.    Sixth Cause of Action for Hostile Work Environment Harassment

In the sixth cause of action, Plaintiffs allege, inter alia, that “Individual Defendants harassed Plaintiffs based on sex, gender, marital status, disability, and associational disability, and in violation of Government Code § 12940(j) by engaging in the course of conduct more fully set forth elsewhere herein, and such harassment, including sexual harassment, was a substantial factor in causing the harm to Plaintiffs as alleged herein.” (Compl., ¶ 109.) Defendants assert that “Plaintiffs fail to allege any facts whatsoever to support their claim that they were subject to a hostile work environment.” (Demurrer at p. 7:1-2.)

Defendants cite to Serri v. Santa Clara University (2014) 226 Cal.App.4th 830, 869, where the Court of Appeal noted that “Government Code section 12940, subdivision (j), defines unlawful employment practice to include harassment in the workplace based on national origin, sex, and age. Under the statute harassment in the workplace can take the form of discriminatory intimidation, ridicule and insult that is sufficiently severe or pervasive to alter the conditions of the victim’s employment and create an abusive working environment. Moreover, harassing conduct takes place outside the scope of necessary job performance, conduct presumably engaged in for personal gratification, because of meanness or bigotry, or for other personal motives. Thus, harassment focuses on situations in which the social environment of the workplace becomes intolerable because the harassment (whether verbal, physical, or visual) communicates an offensive message to the harassed employee.” (Internal quotations, citations, and emphasis omitted.)

Defendants assert that “Plaintiffs fail to allege a single fact regarding any purported conduct which could be perceived as harassing (i.e., verbal, physical, visual, or sexual). The only factual allegations relate to communications between Plaintiff Moran and her unidentified supervisor regarding Plaintiffs’ violation of the Company’s anti-fraternization policy and request that either she or Plaintiff Castro resign, and their ultimate termination on that basis…However, such conduct is merely personnel-management actions and cannot amount to harassment.” (Demurrer at p. 7:14-20.) In Serri v. Santa Clara University, supra, 226 Cal.App.4th at page 870, the Court of Appeal noted that “the Legislature intended that commonly necessary personnel management actions such as hiring and firing, job or project assignments, office or work station assignments, promotion or demotion, performance evaluations, the provision of support, the assignment or nonassignment of supervisory functions, deciding who will and who will not attend meetings, deciding who will be laid off, and the like, do not come within the meaning of harassment. These are actions of a type necessary to carry out the duties of business and personnel management.”

Defendants also assert that “[b]ecause Plaintiffs fail to allege any harassing conduct, they further fail to demonstrate any causal connection between any alleged harassment and protected category.” (Demurrer at p. 7:22-23.)

In the opposition, Plaintiffs assert that they have “plead facts sufficient to state a cause of action…for creation of a hostile work environment in violation of Government Code section 12940(j) against Defendants.” (Opp’n at p. 8:26-28.) Plaintiffs point to paragraph 18 of the Complaint, which alleges, inter alia, that “Ms. Moran suffered an industrial injury in or about May 2022, when she slipped at work causing injuries to her knee. She thereafter returned to work with restrictions. During the period of time in which she was working with restrictions, Defendants routinely forced her to undertake work that was outside the scope of her restrictions. Defendants were hostile towards her, and treated her disparately from other non-injured employees.” (Compl., ¶ 18.) However, Plaintiffs do not appear to allege facts demonstrating how Defendants were purportedly “hostile towards [Ms. Moran], and treated her disparately from other non-injured employees.” (Ibid.)

 Plaintiffs also point to paragraph 19 of the Complaint, which alleges inter alia, that “Ms. Moran was approached by her supervisor and told that either she or her partner, Mr. Castro, needed to resign from the Company. Ms. Moran was blindsided by the request, and when she protested as to why, her supervisor told her that Defendants had a policy that unmarried persons were not allowed to be coworkers, and that she and Mr. Castro were violating that policy.” (Compl., ¶ 19.) However, Plaintiffs do not address Defendants’ point, discussed above, that “commonly necessary personnel management actions such as hiring and firing…deciding who will be laid off, and the like, do not come within the meaning of harassment.” (Serri v. Santa Clara University, supra, 226 Cal.App.4th at p. 870.)

            Plaintiffs also point to paragraph 20 of the Complaint, which alleges that “[p]rior to her termination, Ms. Moran was also the subject of unwanted sexual harassment from Defendant Paul Ahn. Such sexual harassment, along with retaliation from Defendants for rebuffing the harassment, continued through the date of her and Mr. Castro’s termination.” (Compl., ¶ 20.) As set forth above, the Court finds that this allegation is conclusory. Plaintiffs do not appear to allege specific factual allegations concerning the alleged “unwanted sexual harassment from Defendant Paul Ahn.” (Compl., ¶ 20.)

Based on the foregoing, the Court finds that that Defendants have shown that Plaintiff’s sixth cause of action fails to state facts sufficient to constitute a cause of action. Thus, the Court sustains Defendants’ demurrer to the sixth cause of action.

E.     First Cause of Action for Disability, Marital Status, and Sex Discrimination

Next, Defendants assert that “Plaintiff Moran’s first cause of action for sex discrimination is also insufficient.” (Demurrer at p. 8:11-12.) Moran’s first cause of action alleges, inter alia, that “Plaintiff’s sex, gender, marital status, and/or disability was a substantially motivating factor that Defendants considered when deciding to terminate Plaintiff’s employment with Defendants.” (Compl., ¶ 42.)

Defendants assert that “Plaintiff Moran fails to plead sufficient facts to establish a nexus between her sex/gender, and her separation from the entity Defendants or any other alleged adverse action.” (Demurrer at p. 8:21-22.) As an initial matter, the first cause of action is for “disability, marital status, and sex discrimination in violation of FEHA.” (Compl., p. 9:22-23.) Defendants’ demurrer does not appear to challenge Moran’s claims for disability or marital status discrimination. The Court notes that “¿¿a demurrer cannot rightfully be sustained to part of a cause of action or to a particular type of damage or remedy.¿¿” (¿Kong ¿v. City of Hawaiian Gardens Redevelopment Agency (2002) 108 Cal.App.4th 1028, 1047¿¿; ¿see also ¿PH II, Inc. v. Superior Court (1995) 33 Cal.App.4th 1680, 1682 [“A demurrer does not lie to a portion of a cause of action.”]¿¿.) “¿¿[W]hen a substantive defect is clear¿from the face of a complaint . . . a defendant may attack that portion of the cause of action by filing a motion to strike.¿¿” (PH II, Inc. v. ¿Superior Ct., supra¿, ¿¿33 Cal.App.4th at pp. 1682-1683¿¿.)¿¿¿ 

Based on the foregoing, the Court overrules Defendants’ demurrer to the first cause of action.

F.     Eighth Cause of Action for Retaliation

Defendants assert that Plaintiffs’ eighth cause of action for retaliation is insufficient. “[I]n order to establish a prima facie case of retaliation under the FEHA, a plaintiff must show (1) he or she engaged in a ‘protected activity,’ (2) the employer subjected the employee to an adverse employment action, and (3) a causal link existed between the protected activity and the employer’s action.” (Yanowitz v. L'Oreal USA, Inc. (2005) 36 Cal.4th 1028, 1042.)

Defendants assert that “Plaintiffs fail to plead sufficient facts to demonstrate retaliation based on their alleged opposition to sexual harassment and/or sex/gender discrimination. Specifically, Plaintiffs fail to plead facts as to when the alleged sexual harassment occurred, when they allegedly opposed it, and a causal connection between the alleged opposition and their separation from the Company.” (Demurrer at p. 9:12-16.)

However in the retaliation cause of action, Plaintiffs allege that “because of Plaintiffs’ protected characteristics, and because Plaintiffs made protected complaints concerning and/or protested the discrimination and harassment they endured, Defendants, and each of them, retaliated against Plaintiffs.” (Compl., ¶ 137.) Plaintiffs allege that Moran was “harassed, discriminated against, retaliated against, denied an interactive process, denied reasonable accommodations, and ultimately wrongfully terminated for the following unlawful, improper, retaliatory and discriminatory reasons, each of which had absolutely nothing to do with Ms. Moran’s proven ability perform the essential functions of her job: (1) because Ms. Moran was part of a protected class, specifically those with a disability (2) because Ms. Moran was required to take a leave of absence based on her disability; (3) because Defendants, and each of them, did not want to incur the time and expense necessary to accommodate Plaintiff’s disability and/or medical condition; (4) because Defendants, and each of them, did not want to incur the time and expense necessary to engage in a good faith interactive process to address Plaintiff’s disability and/or medical condition, and to pursue avenues that would allow Plaintiff to continue performing essential job functions, or other job functions which were available, despite Plaintiff’s disability and/or medical condition (including the perception thereof); (5) because of Plaintiff’s sex and gender, and for protesting sexual harassment; (6) because of Plaintiff’s marital status; and (7) for the reasons set forth above and outlined below.” (Compl., ¶ 22.)

In addition, Plaintiffs allege that “Mr. Castro…alleges, that he was discriminated against, retaliated against, and ultimately wrongfully terminated for the following unlawful, improper, retaliatory and discriminatory reasons, each of which had absolutely nothing to do with Mr. Castro’s proven ability perform the essential functions of his job: (1) because of his association with Ms. Moran as an unmarried partner, who was part of a protected class, specifically those with a disability (2) because of Mr. Castro’s marital status; and (3) for the reasons set forth above and outlined below.” (Compl., ¶ 23.)

Here, Defendants assert that “Plaintiffs fail to plead sufficient facts to demonstrate retaliation based on their alleged opposition to sexual harassment and/or sex/gender discrimination,” (Demurrer at p. 9:12-14), but do not appear to address Plaintiffs’ other claims of retaliation based on, inter alia, Moran’s alleged disability and Plaintiffs’ marital status. As discussed, “[a] demurrer does not lie to a portion of a cause of action.” (PH II, Inc. v. Superior Court, supra, 33 Cal.App.4th at p. 1682.) In addition, Defendants do not appear to address Castro’s claims of retaliation.

Based on the foregoing, the Court overrules Defendants’ demurrer to the eighth cause of action.  

G.    Eleventh Cause of Action for Wrongful Termination in Violation of Public Policy

Defendants assert that Plaintiffs’ eleventh cause of action for wrongful termination in violation of public policy is insufficient. “It is settled that an employer’s discharge of an employee in violation of a fundamental public policy embodied in a constitutional or statutory provision gives rise to a tort action.” (Barton v. New United Motor Manufacturing, Inc. (1996) 43 Cal.App.4th 1200, 1205.)

Defendants assert that “Plaintiff Moran fails to allege sufficient facts to demonstrate sexual harassment and sex/gender discrimination. Likewise, Plaintiffs fail to plead sufficient facts to demonstrate retaliation based on their alleged opposition to sexual harassment and/or sex/gender discrimination. Specifically, Plaintiffs fail to plead facts as to when the alleged sexual harassment occurred, when they allegedly opposed it, and a causal connection between the alleged opposition and their separation from the Company…Similarly, Plaintiffs’ wrongful termination claim also fails in this regard.” (Demurrer at p. 9:11-17.)

As discussed, the Court overrules Defendants’ demurrer to the eighth cause of action for retaliation. In addition, the Court overrules Defendants’ demurrer to the first cause of action for disability, marital status, and sex discrimination. The Court does not find that Defendants have demonstrated that Plaintiffs’ eleventh cause of action for wrongful termination in violation of public policy is insufficient.

Based on the foregoing, the Court overrules Defendants’ demurrer to the eleventh cause of action.

H.    Third Cause of Action for Failure to Prevent Discrimination and Harassment

Defendants assert that Plaintiffs’ third cause of action for failure to prevent discrimination and harassment is insufficient. In ¿Dickson v. Burke Williams, Inc. (2015) 234 Cal.App.4th 1307, 1314¿, the Court of Appeal noted that “[t]here’s no logic that says an employee who has not been discriminated against can sue an employer for not preventing discrimination that didn’t happen, for not having a policy to prevent discrimination when no discrimination occurred…Our Supreme Court in¿¿Carter¿v. California Dept. of Veterans Affairs¿(2006) 38 Cal.4th 914, 925, footnote 4 [44 Cal. Rptr. 3d 223, 135 P.3d 637]¿, cited¿Trujillo, supra, ¿63 Cal.App.4th 280¿¿for the proposition that courts have required a finding of actual discrimination or harassment under FEHA before a plaintiff may prevail under¿¿section 12940, subdivision (k)¿.” (Internal quotations and citations omitted].)  

As discussed, the Court overrules Defendants’ demurrer to the first cause of action for disability, marital status, and sex discrimination. Accordingly, the Court also overrules Defendants’ demurrer to the third cause of action for failure to prevent discrimination and harassment.

I.       Twelfth Cause of Action for Intentional Infliction of Emotional Distress

Lastly, Defendants assert that Plaintiffs’ twelfth cause of action for intentional infliction of emotional distress is insufficient. In the twelfth cause of action, Plaintiffs allege that they were “subjected to discrimination, retaliation, and harassment (including the Adverse Employment Actions) by Defendants…” (Compl., ¶ 187.) Plaintiffs allege that “[a]s a proximate result of Defendants’ conduct, Plaintiffs have suffered and continue to suffer from severe emotional distress including embarrassment, humiliation, disappointment anxiety, and anger, all to Plaintiffs’ damage…” (Compl., ¶ 192.)

Defendants assert that “when an IIED claim is based on harassment allegations which fail to state a claim, the derivative IIED claims will also fail to satisfy the ‘extreme or outrageous threshold.’” (Demurrer at p. 10:1-2.) Defendants cite to Haberman v. Cengage Learning, Inc. (2009) 180 Cal.App.4th 365, 389, where the Court of Appeal noted that “[i]n Hughes, the Supreme Court stated: Liability for intentional infliction of emotional distress does not extend to mere insults, indignities, threats, annoyances, petty oppressions, or other trivialities…If properly pled, a claim of sexual harassment can establish the outrageous behavior element of a cause of action for intentional infliction of emotional distress.” (Internal quotations omitted.) However, as set forth above, Plaintiffs’ cause of action for intentional infliction of emotional distress is also based on alleged discrimination and retaliation that Plaintiffs were allegedly subjected to. (Compl., ¶ 187.)

Defendants further assert that “Plaintiffs’ twelfth cause of action for IIED is also barred by the exclusivity provisions of the Workers’ Compensation Act.” (Demurrer at p. 10:3-4.) However, Defendants do not cite any legal authority to support this assertion.

Based on the foregoing, the Court overrules Defendants’ demurrer to the twelfth cause of action.

Conclusion

Based on the foregoing, the Court sustains Defendants’ demurrer to the sixth and seventh causes of action of the Complaint, with leave to amend. The Court overrules Defendants’ demurrer to the first, third, eighth, eleventh, and twelfth causes of action of the Complaint.

The Court orders Plaintiffs to file and serve an amended complaint, if any, within 20 days of the date of this Order. If no amended complaint is filed within 20 days of this Order, Defendants are ordered to file and serve their answer(s) within 30 days of the date of this Order.¿

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Defendants are ordered to give notice of this Order.¿ 

DATED:  August 9, 2024                         ________________________________

Hon. Teresa A. Beaudet

Judge, Los Angeles Superior Court