Defendants Lisa M. Gillmor (“Lisa”) and Gillmor Properties, LLC (“Gillmor Properties”) (collectively, “Defendants”) move for judgment on the pleadings against plaintiffs Julia and Manssor Jafari (collectively, “Plaintiffs”).

Plaintiffs were formerly commercial tenants at a property in Santa Clara owned by Defendants where they operated a nightclub. (Complaint at ¶ 7.) On October 4, 2011, two days after submitting notice of their intent to exercise their final five year option, Plaintiffs were served with a no-fault “30 Day Notice of Termination of Tenancy” stating Defendants’ desire to sell the property as cause. (Id. at ¶ 8.) Plaintiffs subsequently filed suit against Defendants for breach of contract. (Id. at ¶ 9.) Shortly thereafter, Defendants responded by filing an unlawful detainer action falsely claiming that Plaintiffs had breached their lease by subletting the kitchen without Defendants’ knowledge or consent. (Id. at ¶ 10.)

Four months after both actions had been filed, the parties agreed to a stipulated judgment for possession only, under the terms of which Defendants would waive all claims to rents and moneys owed and permit Plaintiffs to retain possession of the subject property, rent free, for an additional five months in exchange for Plaintiffs’ promise to dismiss the breach of contract action, withdraw the notice by which they exercised their final five year lease option, and turn over possession on August 1, 2012. (Complaint at ¶ 18.) Once possession was turned over, Defendants would vacate the judgment and dismiss their case. (Id.)

In April 2012, Plaintiffs agreed to an amendment of the aforementioned settlement which called for them to vacate a month earlier on July 3, 2012, in exchange for $50,000. (Complaint at ¶ 21.) Plaintiffs complied with the terms of the agreement and dismissed their claims against Defendants on April 2, 2012. (Id. at ¶ 22.)

Shortly after the case settled, Plaintiffs signed a sublease agreement to take over a property being vacated by Garden City Casino pending final approval of the Master Lessor, Pestana Properties (“Master Lessor”). (Complaint at ¶ 23.) On June 9, 2012, less than one month before the move, Plaintiffs received a letter from the Mater Lessor’s attorney informing them that the sublease would not be approved. (Id. at ¶ 24.) The letter explained that the Master Lessor’s broker had contacted Lisa regarding Plaintiffs’ tenancy and was advised that the lease ended in litigation, that substantial amounts of rent due were not paid and that Plaintiffs had breached their lease agreement by wrongfully subleasing the property to a third party without Defendants’ knowledge or consent. (Id.) According to Plaintiffs, Lisa’s representations regarding back-rent owed and the improper subleasing of the property were false and previously disproved in the prior actions between the parties. (Id. at ¶ 27.) Defendants also did not dismiss or mask the file and judgment as required by the terms of the stipulation executed between the parties. (Id. at ¶ 34.) Plaintiffs have been unable to procure a new commercial property to house their business. (Id. at ¶ 39.)

On June 17, 2013, Plaintiffs filed the Complaint asserting the following claims: (1) tortious interference with prospective economic advantage; (2) slander per se; (3) intentional infliction of emotional distress; and (4) negligent infliction of emotional distress.

On January 21, 2014, Defendants filed the motion for judgment on the pleadings as to each of Plaintiffs’ claims on the ground that these claims do not state facts sufficient to constitute a cause of action. (Code Civ. Proc., § 438, subd. (c).)

Defendants’ request for judicial notice is GRANTED. (See Evid. Code, § 452, subds. (d) and (h).)

Defendants first assert that Plaintiffs fail to state a claim for intentional interference with prospective economic advantage because they have not and cannot allege (1) the necessary existing relationship and (2) an independently wrongful act because the statements made by Lisa were true.

The elements of the tort of intentional interference with prospective economic advantage “are usually stated as follows: (1) an economic relationship between the plaintiff and some third party, with the probability of future economic benefit to the plaintiff; (2) the defendant’s knowledge of the relationship; (3) intentional acts on the part of the defendant designed to disrupt the relationship; (4) actual disruption of the relationship; and (5) economic harm to the plaintiff proximately caused by the acts of the defendant.” (Korea Supply Co. v. Lockheed Martin Corp. (2003) 29 Cal.4th 1134, 1153.)

Defendants’ assertion that Plaintiffs have not adequately alleged the first element of their claim is unavailing. Though somewhat inartfully pleaded, when read in toto, it is evident that the existing economic relationship is that between Plaintiffs and the Master Lessor and, by proxy, Garden City Casino. The prospective future customers of Plaintiffs’ business are, in turn, the probable future economic benefit that was allegedly lost as a result of Defendants’ conduct. Defendants’ reliance on Roth v. Rhodes (1994) 25 Cal.App.4th 530, 236 is misplaced; critically, the landlord in that case was a co-defendant and not the economic relationship that was the subject of the interference claim. The court determined that the plaintiff’s purported “existing economic relationship,” his “future referrals and patient contacts,” could not qualify as such because it was speculative in nature. Here, in contrast, the landlord figure is the economic relationship and that relationship is not speculative, with Plaintiffs alleging that but for Defendants’ interference, their relationship with the Master Lessor (and by proxy, Garden City Casino) would have resulted in the use of the property for their nightclub and the economic benefit that followed.

Defendants’ next contention that Plaintiffs have not and cannot allege an independently wrongful act by Lisa is also not persuasive. “[A] plaintiff seeking to recover for interference with prospective economic advantage must also plead and prove that the defendant engaged in an independently wrongful act in disrupting the relationship. In this regard, ‘an act is independently wrongful if it is unlawful, that is, if it is proscribed by some constitutional, statutory, regulatory, common law, or other determinable legal standard.’” (Reeves v. Hanlon (2004) 33 Cal.4th 1140, 1152, internal citations omitted.) Here, Plaintiffs have pleaded such an act, namely, the making of defamatory statements by Lisa to the Master Lessor. Contrary to Defendants’ assertions, the parties’ agreement in the March 2012 stipulation that Gillmor Properties would waive any rights to recover rents through July 31, 2012, including any claim for any shortfall in the rent between the amounts actually paid and the amounts required to be paid, does not qualify as an actual admission by Plaintiffs that they owed the amounts of back rent Defendants represented they did to the Master Lessor. Further, even assuming, arguendo, that the foregoing waiver could be deemed an admission, Plaintiffs’ allegations of defamation are predicated on more than just Lisa’s alleged misrepresentations regarding the owing of back rent. Plaintiffs also allege that Lisa falsely advised the Master Lessor that they had breached their lease agreement by wrongfully subleasing Defendants’ property. Thus, the independently wrongful act of defamation is still pleaded even if the allegations regarding back rent are discounted.

Defendants next argue that Plaintiffs have failed to state a cause of action for intentional infliction of emotional distress because they have failed to plead outrageous conduct on their part.

“The elements of the tort of intentional infliction of emotional distress are: (1) extreme and outrageous conduct by the defendant with the intention of causing, or reckless disregard of the probability of causing, emotional distress; (2) the plaintiff’s suffering severe or extreme emotional distress; and (3) actual and proximate causation of the emotional distress by the defendant’s outrageous conduct …. Conduct to be outrageous must be so extreme as to exceed all bounds of that usually tolerated in a civilized community. The defendant must have engaged in ‘conduct intended to inflict injury or engaged in with the realization that injury will result.’” (Potter v. Firestone Tire & Rubber Co. (1993) 6 Cal.4th 965, 1001.)

Here, Plaintiffs plead that Defendants’ conduct of “making false and intentionally defamatory statements” about them was “extreme and outrageous.” (Complaint at ¶ 55.) Whether particular conduct is sufficiently outrageous to constitute to state a claim for intentional infliction of emotional distress is a mixed question of law and fact. In the first instance, it is for the Court to determine whether the defendant’s conduct may reasonably be regarded as so extreme and outrageous that recovery is permissible. (See Tollefson v. Roman Catholic Bishop (1990) 219 Cal.App.3d 843, 858.) However, if reasonable persons might differ, it is for the trier of fact to determine whether the conduct has been sufficiently extreme and outrageous to result in liability. (See Molko v. Holy Spirit Ass’n (1988) 46 Cal.3d 1092, 1123.) In addition to pleading that Defendants’ act of intentionally making false statements to the Master Lessor with the aim of sabotaging their lease of the new property is extreme and outrageous, Plaintiffs also allege that that conduct was part of a “vindictive pattern or practice engaged in by the Gillmors, to intimidate and punish the Jafaris for defending their rights and standing up, against them ….” (Complaint at ¶ 35.) Taken in total, this conduct may reasonably be viewed as extreme and outrageous. The question of whether Defendants’ conduct was actually sufficiently extreme or outrageous to result in liability is a question beyond the scope of demurrer.

Defendants next argue that judgment on the pleadings is proper as to all of Plaintiffs’ claims because the Complaint is barred by the parties’ stipulations. In particular, Defendants focus on the March 2012 stipulation’s general release of all claims which provides that:

The parties understand that they may have sustained serious damage or consequential injuries which have not manifested themselves and/or which are presently unknown, but nonetheless deliberately intend to and do hereby release these possible future claims.

(RJN, Exhibit A, ¶ 7.)

Defendants’ interpretation of the foregoing provision as operating to bar the instant action is not persuasive. Based on its express language, the general release clearly applies only to injuries and damages sustained (but not necessarily realized) up to the point at which the stipulation was entered into based on the use of the past tense (i.e., “may have sustained”) and the use of the term “these” to refer to those specific claims as the only claims being released. There is nothing in the general release provision of the stipulation which provides that Defendants are released from any future claims occasioned by wrongful conduct which occurs after the stipulation is entered into. As the stipulation was entered into and filed three months before the events upon which Plaintiffs’ claims are based took place (see Complaint at ¶¶ 24-26), Plaintiffs claims are not barred by the general release in the March 2012 stipulation.

Defendants next argue that Plaintiffs failed to perform pursuant to the stipulation and therefore excused their obligation to mask the judgment as required therein. In making this argument, Defendants cite to a portion of the Court’s docket, which has been judicially noticed, as evidence that Plaintiffs failed to vacate the premises. The portion cited is an entry from September 27, 2012, which states the following under the category of “Document Description” for items filed: “Writ of Posses/Unsatis.” This is insufficient by itself to demonstrate that Plaintiffs did not comply with the agreement to vacate by July 3, 2012 as provided by the stipulation. While the Court is permitted to take judicial notice of the docket pursuant to Evidence Code section 452, subdivision (d), it cannot take notice of the truth of its contents if those matters are reasonably disputable. (See Fremont Indem. Co. v. Fremont Gen. Corp. (2007) 148 Cal.App.4th 97, 113.) Plaintiffs insist that they did vacate by the deadline agreed up by the parties and that the docket entry is only a reflection of the fact that the dismissal of the unlawful detainer had not yet been filed. These are disputed factual issues that cannot be resolved on demurrer.
Finally, even if Plaintiffs failed to comply with the stipulation, this failure would not render all of the purportedly false statements made by Lisa to the Master Lessor true.
Defendants lastly argue that Plaintiffs lack standing to assert any interest in this case because the aggrieved statements concerned the corporate entity Avalon Nightclub Group, Inc. However, this purported lack of standing is not evident from the allegations of the Complaint as Plaintiffs allege that the purportedly defamatory statements made by Lisa were about them, specifically (see e.g., Complaint at ¶ 26 [“Ms. Gillmor told him that the Jafaris failed to pay substantial amounts of rent during their tenancy at her commercial property, and that there was a substantial amount of back-rent still owing by the Jafaris, that there was related litigation between the Gillmor’s and the Jafaris, that the Jafaris had breached their lease agreement …”]). These allegations are accepted as true for the purposes of demurrer. (See Aubry v. Tri-City Hosp. Dist. (1992) 2 Cal.4th 962, 966-967.) Consequently, this argument is without merit.
In accordance with the foregoing analysis, Defendants’ motion for judgment on the pleadings as to each of the causes of action asserted in the Complaint is DENIED.