Judge Thomas D. Long, Case Number: 21STCV08177, Date: 2024-08-27 Tentative Ruling

On November 7, 2023, Plaintiff John Roe filed a first amended complaint (“FAC”) against Defendants Edwin Glaeser and James Colby Stratman.

On November 22, 2023, Plaintiff filed a motion for leave to maintain the FAC as a pseudonym plaintiff.

With their opposition to Plaintiff’s motion to maintain this action under a pseudonym, Defendants filed an application to file the Declaration of Jesse B. Levin under seal.

The Court may order that a record be filed under seal only if it finds that (1) there is an overriding interest that overcomes the right of public access to the record, (2) the overriding interest supports sealing the record, (3) a substantial probability exists that the overriding interest will be prejudiced absent sealing, (4) the proposed sealing is narrowly tailored, and (5) no less restrictive means exists to achieve the overriding interest. (California Rules of Court, rule 2.550(d).) A motion seeking an order sealing records must be accompanied by a declaration containing facts sufficient to justify the sealing. (California Rules of Court, rule 2.551(b)(1).)

Defendants request that the Court permit Defendants to conditionally file this document and its exhibits under seal until the Court rules on Plaintiff’s motion. The declaration’s exhibits include pleadings and orders in other cases involving Plaintiff and publicly published articles about Plaintiff. Plaintiff’s identity is disclosed throughout the exhibits, and the declaration’s public filing would undermine Plaintiff’s ability to litigate under a pseudonym.

The application is GRANTED in part. Defendants may lodge (and have already properly lodged) the Declaration of Jesse B. Levin under seal pending the Court’s ruling on Plaintiff’s motion to maintain this action under a pseudonym.

Now that the Court does concurrently rule on Plaintiff’s motion, the application is DENIED with respect to any further sealing. Plaintiff did not file his own application to seal the declaration beyond the motion’s hearing date. Even if he had, for the reasons explained with the motion to maintain this action under a pseudonym, there is no good cause to keep the documents under seal. Plaintiff’s interest in maintaining anonymity in this action does not overcome the right of public access to the record, particularly when the exhibits are publicly filed court records and published news articles.

Defendants are ordered to file a public, unredacted version of the Declaration of Jesse B. Levin within five days.

Plaintiff requests to proceed under a pseudonym, seal records that disclose his identity and private information, and enter a protective order to limit the disclosure of private information.

“[T]he right to access court proceedings necessarily includes the right to know the identity of the parties.” (Department of Fair Employment and Housing v. Superior Court of Santa Clara County (2022) 82 Cal.App.5th 105, 111.) Accordingly, “[t]he names of all parties to a civil action must be included in the complaint. “ (Id. at p. 109, citing Code Civ. Proc., § 422.40.)

“‘[A] party may preserve his or her anonymity in judicial proceedings in special circumstances when the party’s need for anonymity outweighs prejudice to the opposing party and the public’s interest in knowing the party’s identity.’” (Doe v. Lincoln Unified School Dist. (2010) 188 Cal.App.4th 758, 767, quoting Does I thru XXIII v. Advanced Textile Corp. (9th Cir. 2000) 214 F.3d 1058, 1068.)

Plaintiff argues that his health and well-being is an overriding interest. (Motion at p. 5.) He has a medical history of OCD and alcohol abuse. (Ibid.; FAC ¶¶ 9-11.) According to Plaintiff, “[t]he scientific community and research has long recognized that increased subjective stress or distress is a risk factor for relapse for alcoholics,” and “Plaintiff’s health and well-being should not be jeopardized at the risk of him trying to recover millions of dollars from Defendants for their fraudulent conduct against Plaintiff.” (Motion at p. 5.) Plaintiff asserts that his “health disorders and the risk of them increasing in severity and him relapsing should easily override the public’s right of access to the Court’s proceedings. No person’s personal health should be overlooked and prioritized below public access.” (Ibid.) Plaintiff also argues that there is substantial risk that he or his family will be faced with harassment and ridicule from media or their social circles. (Id. at pp. 5-6.)

As Defendants note, “Plaintiff fails to cite a single case authorizing the use of a pseudonym to protect information related to alcoholism or OCD.” (Opposition at p. 7.) Plaintiff admits that he found no cases where OCD or alcoholism was an overriding interest used to grant a pseudonym request, but he compares it to granting a request for a pseudonym in cases involving other health related topics such as abortion, birth control, HIV, and sperm donors. (Reply at p. 2.) Plaintiff asserts that the basis for his request reflects “a natural zone of expansion of anonymity on account of private health matters.” (Id. at pp. 2-3.)

On the other hand, Defendants cite multiple persuasive, but not binding, cases with similar privacy concerns where courts denied requests to use pseudonyms.

When denying a recovered drug addict’s request for a pseudonym, one court “[did] not discount Doe’s very real concerns about reputational harm, both personally or professionally, or her fears of relapse in the event of such backlash. But those types of fears are similar to those of other plaintiffs who have alleged that they were discriminated against because of their histories of substance abuse, and it is clear that several similarly-situated plaintiffs have publicly identified themselves in their own litigations. Finally, we would be remiss to ignore that ‘embarrassment and fear of economic harm’ alone are not enough for a plaintiff to meet her burden to proceed anonymously.” (Doe v. Main Line Hospitals, Inc. (E.D. Pa., Sept. 1, 2020, No. CV 20-2637-KSM) 2020 WL 5210994, at *5.)

In cases alleging disability discrimination or violations of the Americans with Disabilities Act, many courts have denied the use of a pseudonym when the request is based on professional harm, humiliation, personal medical information, and media scrutiny. (See, e.g., Doe v. Apstra, Inc. (N.D. Cal., Aug. 23, 2018, No. C 18-04190 WHA) 2018 WL 4028679; Rankin v. New York Public Library (S.D.N.Y., Dec. 2, 1999, No. 98 CIV. 4821 (RPP)) 1999 WL 1084224; Doe v. Prudential Ins. Co. of America (D.R.I. 1990) 744 F.Supp. 40; Doe v. Rostker (N.D. Cal. 1981) 89 F.R.D. 158.)

Defendants also argue that in other litigation, Plaintiff has already publicly disclosed the facts he seeks to protect. (Opposition at p. 9.)

Plaintiff argues that the allegations of alcohol consumption and sobriety in the California actions and related publications are not the same thing as Plaintiff making public admissions about his OCD diagnosis or alcoholism. (Reply at p. 4.) Plaintiff contends that “[t]he news articles directly relevant to this civil action merely parrots the defense allegations against Plaintiff and are equally unavailing if used to show a public admission by Plaintiff.” (Ibid.) This is true with respect to the California actions and new articles. (See Levin Decl., Exs. A-E.)

Plaintiff notes that in the Massachusetts action, his allegations “only say that Plaintiff sought psychiatric treatment and that the medical provider held himself out as a leading expert in OCD treatment,” which “is not tantamount to a public disclosure of an OCD diagnosis by Plaintiff.” (Reply at p. 5.) Plaintiff’s second amended complaint in that action alleges—in Plaintiff’s real name—that in 2013, he retained a doctor who was “a leading expert in treatment of obsessive-compulsive disorder (OCD)” “to provide treatment to him.” (Levin Decl., Ex. H at ¶ 5.) That doctor agreed to provide Plaintiff’s treatment in Hawaii if he could take along his wife, “who helps with OCD treatment,” and provide “team treatment.” (Id. ¶ 6.) The only plausible reading of those allegations is that Plaintiff was receiving OCD treatment.

Although Plaintiff’s prior public disclosures did not include admissions about his alcohol consumption and sobriety, Plaintiff has not demonstrated an overriding interest that outweighs the public’s interest in his identity and overcomes the statutory requirement of disclosing his name. (See Code Civ. Proc., § 422.40.) Additionally, Plaintiff himself has already disclosed his identity in this action. On May 12, 2023, while Plaintiff was proceeding in pro per, he filed two Amendments to Complaint to name Doe Defendants. These filings contain Plaintiff’s true name and address.

Plaintiff requests that his identifying records, medical records, and financial records be sealed. (Motion at pp. 6-8.) Plaintiff contends that these records “are relevant and are likely, if not anticipated, to be disclosed during discovery in this action.” (Id. at p. 6.) Plaintiff also requests to seal “all filed documents.” (Id. at p. 8.) This request is overbroad and does not comply with applications to file records under seal. The Court will not broadly order previous filings and unknown future filings to be filed under seal. If Plaintiff contends that any specific documents should be filed under seal, Plaintiff may file a proper application as to those records if and when they are filed. Any disclosure of confidential or private records during discovery is covered by the existing protective order. The request to seal is denied.

Plaintiff also requests to seal specific previously filed documents in this case that disclose his identity. (Motion at pp. 7-8.) This request is denied because Plaintiff’s request to proceed under a pseudonym is denied.

On April 22, 2024, the parties filed—and the Court signed—a joint stipulation for a protective order.

The request for entry of a protective order is denied as moot. (See Motion at pp. 8-9; Reply at p. 2, fn. 1.)

The Motion for Leave to Maintain the First Amended Complaint as a Pseudonym Plaintiff and to Seal Documents and for a Protective Order is DENIED.

The caption page identifies this as the Motion of Defendant Edwin Glaeser to Demurrer to First Amended Complaint. The notice of motion states, “Defendants Edwin Glaeser and James Colby Stratman will and hereby do move this Court, pursuant to California Code of Civil Procedure Sections 430.10, 430.30, and 430.50, to grant their Motion to Demurrer to the First Amended Complaint.” (Demurrer at p. 5.) All parties refer to “Defendants,” and there is no showing of confusion or prejudice caused by this discrepancy. The Court therefore rules on this demurrer as to both Defendants.

A demurrer for sufficiency tests whether the complaint states a cause of action. (Hahn v. Mirda (2007) 147 Cal.App.4th 740, 747.) When considering demurrers, courts read the allegations liberally and in context, accepting the alleged facts as true. (Nolte v. Cedars-Sinai Medical Center (2015) 236 Cal.App.4th 1401, 1406.)

Defendants argue that Plaintiff is not the real party in interest and lacks standing because the harm was to the Trust, not to Plaintiff. (Demurrer at pp. 11-13.)

Plaintiff alleges that he is “the co-trustee and beneficiary of the two separate Trusts for the Benefit of John Roe (collectively hereinafter the ‘Trust’), which owns a substantial interest in various companies of holding significant assets (the ‘Company’).” (FAC ¶ 1.) However, Plaintiff brings this action as an individual, not as a trustee.

“‘[I]f a third person commits a tort with respect to the trust property, the trustee and not the beneficiary is ordinarily the proper party to bring an action against him.’” (Estate of Bowles (2008) 169 Cal.App.4th 684, 692.) “A party who is not the real party in interest lacks standing to sue because the claim belongs to someone else.” (Id. at p. 690.)

Plaintiff argues that he “alleged numerous injuries to him personally as an individual and as a co-trustee throughout his amended pleading,” including (1) he was personally harmed by the “[e]xorbitant and unjustified pay to Defendants as sober coaches that they absconded with because Defendants kept Plaintiff in and out of rehab in order to keep their employment”; (2) by the “[m]oney paid for Defendants’ personal expenses and charges to Plaintiffs’ credit cards or paid by the Trust”; and (3) by the “[m]oney paid to Defendants in form of loans assigned to Plaintiffs and were offset by redeeming his interest and shares in the assets of the Trust.” (Opposition at p. 2; see FAC ¶ 49.)

The “[e]xorbitant and unjustified pay to Defendants as sober coaches that they absconded with” is a harm to the Trust, not Plaintiff individually. Defendant Glaeser received an annual salary of $60,000.00, “to be paid by the Trust.” (FAC ¶ 15.) Both Defendants’ “salaries and expenses were being covered by the Trust, or one of the companies held by his family, as payment for routine expenses.” (FAC ¶ 22.) Later, Defendant Glaeser started his own company, “yet was still receiving substantial payments from the Trust for his alleged services on the Care Team.” (FAC ¶ 25.)

The “[m]oney paid for Defendants’ personal expenses and charges to Plaintiffs’ credit cards or paid by the Trust” is a harm to the Trust, not Plaintiff individually. Plaintiff does allege that Defendants “controlled Plaintiff’s use and payment of his credit cards” (FAC ¶¶ 24, 53, 106), but the ultimate harm from this control is the money spent from the Trust: “Defendants communicated to the Trust on Plaintiff's behalf that they controlled Plaintiff’s spending, they controlled Plaintiff’s money from the Trust, they controlled which expenses were submitted to the Trust for payment or reimbursement to Plaintiff, and they controlled Plaintiff’s use and payments of his credit cards.” (FAC ¶ 53; see FAC ¶ 24, 106.) Later, Plaintiff demanded that Defendant Glaeser “provide American Express statements matching the amount requested from the Trust as reimbursement.” (FAC ¶ 34.)

The “[m]oney paid to Defendants in form of loans assigned to Plaintiffs and were offset by redeeming his interest and shares in the assets of the Trust” is also a harm to the Trust, not Plaintiff individually. Defendant Glaeser “entered into loans with the Company on Plaintiff’s behalf and falsely claimed that Plaintiff authorized his shares in the Company to be redeemed without his knowledge.” (FAC ¶ 39.) “Defendants had falsely advised the Trust that Plaintiff had approved loans to Defendants that shall be paid by redeeming shares of Plaintiff’s interests in the Company.” (FAC ¶ 36.) Plaintiff’s shares in the Company are owned by the Trust. (FAC ¶ 1.)

Plaintiff filed this action on March 2, 2021. Defendants argue that all causes of action are barred by their respective statutes of limitations. (Demurrer at pp. 13-17.)

The running of the statute must appear clearly and affirmatively on the face of the complaint. (Geneva Towers Ltd. Partnership v. City of San Francisco (2003) 29 Cal.4th 769, 781.) “‘[I]t is not enough that the complaint might be time-barred. [Citation.]’” (Ibid.)

The first cause of action alleges that Defendants were negligent in carrying out their services with respect to their “undertaking and responsibility of Plaintiff’s sobriety and health . . . [and] finances.” (FAC ¶¶ 43-44.) “A cause of action for professional negligence is generally governed by the two-year statute of limitations under Code of Civil Procedure section 339, subdivision (1).” (Thomson v. Canyon (2011) 198 Cal.App.4th 594, 606.) Defendants began working as sober coaches with salaries paid by the Trust in 2010 and 2012. (FAC ¶¶ 15, 17.) Defendant Stratman’s employment was terminated in 2018. (FAC ¶ 32.) For Defendant Glaeser, the last alleged financial transaction occurred in late 2017. (FAC ¶ 31.) There are no factual allegations of professional negligence within two years of March 2, 2021.

The fifth cause of action alleges fraud, which is subject to a three-year limitations period. (Code Civ. Proc., § 338, subd. (d).) The alleged fraud is Defendants’ false representations of being sober coaches with significant experience in alcohol rehab plans and treatments. (FAC ¶ 71.) Defendants made these representations in 2010 and 2012. (FAC ¶¶ 15, 17-18.) There are no factual allegations of fraud within three years of March 2, 2021.

2. The Second, Third, Fourth, Fifth, Seventh, Ninth, and Tenth Causes of Action are Not Facially Time-Barred.

The second, third, and fourth causes of action allege breach of fiduciary duty and aiding and abetting breach of fiduciary duty. “The statute of limitations for breach of fiduciary duty is three years or four years, depending on whether the breach is fraudulent or nonfraudulent.” (American Master Lease LLC v. Idanta Partners, Ltd. (2014) 225 Cal.App.4th 1451, 1479.) “[T]he statute of limitations for aiding and abetting a breach of fiduciary duty is the same as the statute of limitations for breach of fiduciary duty.” (Ibid.) Defendants engaged in self-dealing and used Trust funds for their personal gain. (FAC ¶ 54.) Defendant Stratman’s employment was terminated in 2018, and Defendant Glaeser’s employment was terminated in 2020—within three years of 2021. (FAC ¶¶ 32, 35.) The demurrer to the second, third, and fourth causes of action is overruled.

The sixth cause of action alleges fraudulent concealment, which is subject to a three-year limitations period. (Code Civ. Proc., § 338, subd. (d).) Defendants concealed loans obtained in Plaintiff’s name. (FAC ¶ 80.) There are no facts showing when these loans were obtained and concealed, other than it must have occurred before Defendants’ employment ended in 2018 and 2020. (See FAC ¶¶ 32, 35.) Defendants acknowledge that Plaintiff “never discloses in the FAC when the loans were allegedly made or who made them,” but they argue that “a fair reading of the Complaint indicates that the alleged loans occurred when Defendants allegedly took ‘control of Plaintiff’s financial life’ in 2015.” (Demurrer at p. 15.) That assumption is not what is actually alleged. A plaintiff is not required to plead “in anticipation of the statute of limitations.” (Union Carbide Corp. v. Superior Court (1984) 36 Cal.3d 15, 26.) In other words, “[w]here a complaint does not reveal on its face that it is barred by the statute of limitations, a plaintiff has no obligation to plead around the defense.” (JPMorgan Chase Bank, N.A. v. Ward (2019) 33 Cal.App.5th 678, 688.) The demurrer to the sixth cause of action is overruled.

The ninth cause of action alleges conversion of Trust funds. Conversion is subject to a three-year limitations period as “[a]n action for taking, detaining, or injuring goods or chattels, including an action for the specific recovery of personal property.” (Code Civ. Proc., § 338, subd. (c)(1).) Plaintiff alleges that Defendants “intentionally wrongfully converted and disposed of Plaintiffs distributions from the Trusts.” (FAC ¶ 107.) Defendants note that “allegations of control and misconduct associated with that control began in 2015.” (Demurrer at p. 17; see FAC ¶ 24.) However, Plaintiff alleges ongoing conduct. It is not clear when the last acts of conversion occurred. The demurrer to the ninth cause of action is overruled.

The tenth cause of action seeks an accounting. “[A]n action seeking an accounting is a[n] action in equity. [Citation.] In an action for a[n] accounting the applicable statute of limitations may be the four-year period provided in Code of Civil Procedure section 343. [Citations.]” (Estate of Peebles (1972) 27 Cal.App.3d 163, 166.) Similar to other causes of action, there are no allegations showing when the self-dealing and misspent funds ended. The demurrer to the tenth cause of action is overruled.

The seventh cause of action for unfair business practices must be commenced within four years after the cause of action accrued. (Bus. & Prof. Code, § 17208.) Plaintiff alleges that Defendants “[made] material misrepresentations to the Trust regarding Plaintiff’s health in order to secure continued employment and higher payments,’ and “[used] Trust funds designated for Plaintiff’s expenses for their personal gain.” (FAC ¶ 90.) For the reasons above, there are not facts showing that the misrepresentations and misuse of funds only occurred more than four years prior to March 2, 2021. The demurrer to the seventh cause of action is overruled.

The eighth cause of action alleges intentional interference with prospective economic advantage. “It is now well established that a cause of action for interference with prospective economic advantage, an action involving a property right, is governed by the two-year limitations period of [Code of Civil Procedure] section 339, subdivision 1.” (Augusta v. United Service Automobile Assn. (1993) 13 Cal.App.4th 4, 10.) Defendants “intentionally misrepresented both the state of Plaintiff’s health and other facts about Plaintiff to be determined, in order to disrupt the relationship between Plaintiff and the Trust, for the purpose of Defendants’ personal gain.” (FAC ¶ 99.) There are no facts showing specific timing, other than it must have occurred before Defendants’ employment ended in 2018 (Stratman) and 2020 (Glaesar). (See FAC ¶¶ 32, 35.)

The demurrer to the eighth cause of action is sustained as to Stratman and overruled as to Glaesar.

“An important exception to the general rule of accrual is the ‘discovery rule,’ which postpones accrual of a cause of action until the plaintiff discovers, or has reason to discover, the cause of action. [Citation.]” (Fox v. Ethicon Endo-Surgery, Inc. (2005) 35 Cal.4th 797, 807.) “A plaintiff has reason to discover a cause of action when he or she ‘has reason at least to suspect a factual basis for its elements.’ [Citation.]” (Ibid.) “In order to rely on the discovery rule for delayed accrual of a cause of action, ‘[a] plaintiff whose complaint shows on its face that his claim would be barred without the benefit of the discovery rule must specifically plead facts to show (1) the time and manner of discovery and (2) the inability to have made earlier discovery despite reasonable diligence.’ [Citation.] In assessing the sufficiency of the allegations of delayed discovery, the court places the burden on the plaintiff to ‘show diligence’; ‘conclusory allegations will not withstand demurrer.’ [Citation.]” (Id. at p. 808.)

Defendants argue that “Plaintiff’s threadbare assertion that he only ‘discovered’ the negligence and fraudulent loans in mid-2020 does nothing to salvage his claims.” (Demurrer at pp. 17-18.)

Plaintiff alleges that he did not know that “Defendants had falsely advised the Trust that Plaintiff had approved loans to Defendants that shall be paid by redeeming shares of Plaintiffs interests in the Company” until May through July 2020. (FAC ¶ 36.) “[O]n or about July 31, 2020, Plaintiff received notice via letters to his accountant (and subsequently his trust attorney) that approximately $4.8 million worth of his funding – which should have been made from the Trust – was instead being treated as loans to Plaintiff from the Company.” (FAC ¶ 38.) Plaintiff does not allege facts showing an inability to have made earlier discovery despite reasonable diligence.

Any amended complaint may not use a pseudonym and must be filed in Plaintiff’s true name.

Parties who intend to submit on this tentative must send an email to the Court at SMCDEPT48@lacourt.org indicating intention to submit. If all parties in the case submit on the tentative ruling, no appearances before the Court are required unless a companion hearing (for example, a Case Management Conference) is also on calendar.

Hon. Thomas D. Long

Judge of the Superior Court