Case Number: EC061911 Hearing Date: May 02, 2014 Dept: NCE

¿Demurrer of defendant American Leak Detection, Inc. is sustained on the ground it is not clearly
alleged what this particular defendant is claimed to have done which would be considered an
unlawful, unfair or fraudulent business practice. No specific allegations are made concerning the
conduct of this party. Due to this lack of specificity, it is uncertain whether the claim may be
barred due to the lack of any direct contractual duty owed by demurring defendant to plaintiffs or
whether causation is adequately stated. If it is plaintiff’s theory that this defendant is responsible
for the conduct of Travelers based upon a conspiracy theory, plaintiff has cited no legal authority
under which such a claim may be stated in the context of unfair business practices where vicarious liability is not recognized. See Emery v. Visa International Service Association (2002)
95 Cal.App.4th 952, 960 (“We need go no further than to remind plaintiff that his unfair practices claim under section 17200 cannot be predicated on vicarious liability. ‘The concept of vicarious liability has no application to actions brought under the unfair business practices act.’ (People v. Toomey (1984) 157 Cal.App.3d 1, 14 [203 Cal.Rptr. 642] (Toomey).) A defendant’s liability must be based on his personal ‘participation in the unlawful practices’ and ‘unbridled control’ over the practices that are found to violate section 17200 or 17500. (Toomey, supra, 157 Cal.App.3d at p. 15.) Unlike Mr. Toomey, VISA exercised no control over the preparation or
distribution of the solicitations, nor did it have any relationship with the merchant who did.”)

Ten days leave to amend.

Demurrer on the ground that the cause of action fails as a matter of law under the holding of
Moradi-Shalal v. Fireman’s Fund Ins. Companies (1993) 14 Cal.App.4th 612, 619 is overruled because the cause of action alleges various acts of common law bad faith, including the withholding of policy benefits, refusal to timely consider proofs of claim, and refusing to participate in an appraisal. (Para. 20.) See Zhang v. California Ins. Co. (2013) 57 Cal.4th 364,368-369 (“The Moradi-Shalal court made it plain that while violations of [Ins. Code] section
790.03(h) are themselves not actionable, insureds retain other causes of action against insurers,
including common law bad faith claims. Furthermore, UCL actions by private parties are equitable proceedings, with limited remedies. They are thus quite distinct from the claims for damages with which Moradi-Shalal was concerned.”)

Unopposed motion to strike portions of complaint (attorneys’ fees demand in paragraph 34) is
granted without leave to amend. A plaintiff may not recover damages, treble damages or other penalties, or attorneys’ fees in private actions for violation of Business & Professions Code section 17200, under which the only available remedies are injunction or restitution. Business & Professions Code section 17203; Korea Supply Co. v. Lockheed Martin Corp. (2003) 29 Cal.4th 1134, 1145-1146.