2013-00140847-CU-OE
Adela Bon Gaunia vs. A Family Affair, Inc.
Nature of Proceeding:
Filed By:
Hearing on Demurrer (A Family Affair, Inc.)
Wisniewski, Ashley M.

Defendants A Family Affair, Inc., A Family Affair Bridges, Inc., a Family Affair
Connection, Inc., Carolyn Mitchell’s Loving Care Home (“the entity defendants”) and
Kassia Mitchell Lucero’s Demurrer to the First Amended Complaint is SUSTAINED,
without leave to amend.

The First Amended Complaint (“FAC”) sets forth 19 causes of action against multiple
thdefendants. Moving defendants demur only to three causes of action: the 17th for
Violation of the Racketeer Influence and Corrupt Organization Act (“RICO”) (18 USC
§1962), the 18th for Conspiracy to Violate RICO and the individual defendant Lucero,
only, demurs to the 19th for Labor Code § 2699 Private Attorney General Action for
Civil Penalties.

Plaintiff alleges that she was employed by defendants as a care giver and domestic
worker in elderly and/or adult developmentally disabled residential nursing care home
facilities owned, operated, and/or maintained by defendants. Her time was spent
working at six different facilities maintained by defendants in Sacramento.
RICO violations are set forth in 18 U.S.C. §§ 1961-1968. Section 1962 provides four
categories of activities that will give rise to the RICO civil and criminal remedies. (18
U.S.C. § 1962.) Each of the four categories of RICO violation is triggered by a pattern
of racketeering activity where the activity engages in or affects interstate commerce.

In general, the plaintiff must prove that the defendant caused injury to the plaintiff’s
business or property by engaging in a pattern of racketeering activity in connection
with an enterprise which affects interstate commerce. Gervase v. Superior Court
(1995) 31 Cal. App. 4th 1218, 1232 .

The FAC alleges that the businesses of defendants are located in Sacramento,
California, the individual defendants all reside in Sacramento, California, the plaintiff
worked in Sacramento, California and the elderly and/or adult developmentally
disabled residential nursing care home facilities were all licensed by the California
Health and Safety Code and regulated by the California Department of Social
Services. (FAC, paras, 3, 4, 10-12.)

Defendants assert that the FAC contains no allegations of any enterprise which is
engaged in or affects interstate commerce.

In opposition, plaintiff concedes that the requirement of an interstate commerce effect
is jurisdictional, but asserts that the “affecting interstate commerce” requirement is
minimal, and is satisfied by impacts which are attenuated, marginal, or would only
become impactful if repeated on a large scale. See, e.g., U.S. v. Rone (1979) 598 F.2d
564, 573; U.S. v. Juvenile Male (9th Cir. 1997) 118 F.3d 1344, 1347; National
Organization for Women, Inc. v. Scheidler (1994) 510 U.S. 249, 250. Moreover, to
establish a de minimis interstate commerce impact, a party “need not show that a
defendant’s acts actually affected interstate commerce. Rather, the jurisdictional
requirement is satisfied by proof of a probable or potential impact.” U.S. v. Juvenile
Male, supra, 118 F.3d at 1349.

However, plaintiff has failed to allege any facts reflecting that defendants operate an
enterprise that is involved in or affects interstate commerce. Conclusory allegations
alone are insufficient. (FAC, para. 146.)

Demurrer by defendant Kassia Lucero to the 19th cause of action for Labor Code, sec.
2699 penalties is SUSTAINED, without leave to amend.

Kassia Lucero demurs on the grounds that she cannot be held personally liable under
Labor Code section 2699. Plaintiff concedes the correctness of that position, but asserts that the Court need not
reach that issue because the Lucero is the alter-ego of the Corporate Defendants, and
thus personally liable for any and all statutory violations by the Corporate Defendants.
The Court finds that facts to support the conclusion that the Lucero is the alter-ego of
the corporate defendants have not been sufficiently alleged and are conclusory. A
plaintiff alleging that an individual is the alter ego of a corporate entity must plead facts
showing (1) a unity of interest and ownership such that the separateness does not
actually exist and (2) that a inequitable result would occur if the acts in question are
treated as those of the corporation alone. (Vasey v. California Dance Co. (1977) 70
Cal.App.3d 742, 749.) The allegations of alter-ego on information and belief in
paragraph 7 are insufficient. As plaintiff has also alleged that the Lucero was acting in
the scope, course and authority of her agency (FAC, para. 7) and only employers, not
their agents, can be liable under Labor code 2699, the allegations are insufficient to
state a cause of action.

Leave to amend should be denied where the facts are not in dispute and the nature of
the claim is clear, but no liability exists under substantive law. Lawrence v. Bank of
America (1985) 163 Cal. App. 3d 431, 436.
Defendants A Family Affair, Inc., A Family Affair Bridges, Inc., a Family Affair
Connection, Inc., Carolyn Mitchell’s Loving Care Home (“the entity defendants”) and
Kassia Mitchell Lucero shall file and serve their Answer to the remaining causes of
action not later than Friday, March 21, 2014.

The minute order is effective immediately. No formal order pursuant to CRC Rule
3.1312 or further notice is required.