Case Number: GC049435 Hearing Date: June 13, 2014 Dept: A

Loh v Deng aka Huiduan

MOTION FOR JUDGMENT ON THE PLEADINGS

Calendar: 21
Case No: GC049345 (related to BC497876)
Date: 6/13/14

MP: Cross-Defendant, Hui Duan Jenny Deng (“Jenny Deng”)
RP: Cross-Complainants, Jimmy Loh and Su Liu, CPA’s, APC, Jimmy Loh, and Su Liu

ALLEGATIONS IN CROSS-COMPLAINT (in BC497876):
The Cross-Defendant, Jenny Deng, was employed by the Cross-Complainants as a staff accountant. While she was an employee, Jenny Deng converted the Cross-Complainants’ property. Further, after she terminated her employment, Jenny Deng engaged in unfair competition with the Cross-Complainants by opening a competing business with confidential information that she had obtained. In addition, Jenny Deng has defamed the Cross-Complainants.

CAUSES OF ACTION IN CROSS-COMPLAINT (in BC497876):
1) Misappropriation of Trade Secret
2) Conversion
3) Accounting
4) Unfair Competition
5) Defamation
6) Intentional Infliction of Emotional Distress

RELIEF REQUESTED:
Judgment on the Pleadings as to fifth and sixth causes of action.

DISCUSSION:
The cases GC049345 and BC497876 are related because they arise from claims regarding the employment of Jenny Deng with Jimmy Loh and Su Liu, CPAs, APC. The current hearing concerns the pleadings in BC497876.
In BC497876, the Plaintiff, Jenny Deng, claims that her employment with the Defendants, Jimmy Loh and Su Liu, CPAs, APC, Jimmy Loh, Su Liu, and Peter Hwu, was wrongfully terminated. The Defendants then filed a Cross-Complaint to claim that Jenny Deng had converted the Defendants’ property, engaged in unfair competition with the Defendants, and had defamed the Defendants.
This case was transferred from Department 51 on February 26, 2014 because the Court found that it was related to GC049345, which is pending before this Court.
No trial is set.

This hearing concerns the motion for a judgment on the pleadings of Cross-Defendant, Jenny Deng, and it is directed at the fifth and sixth causes of action in the Cross-Complaint. The Cross-Defendant argues that the fifth cause of action is barred by the statute of limitations and that the sixth cause of action lacks facts showing that the conduct was outrageous.
The Cross-Defendant filed demurrers to these causes of action, which were overruled on December 19, 2013. A review of the demurrers reveals that they were based on different grounds from the pending motion for judgment on the pleadings, e.g., the demurrers did not raise the issue of the statute of limitations.

1. Fifth Cause of Action for Defamation
The Cross-Defendant argues that this cause of action is barred by the one-year statute of limitations for defamation claims. When the dates alleged in the complaint show the action is barred by the statute of limitations, a general demurrer lies. Saliter v. Pierce Bros. Mortuaries (1978) 81 Cal.App.3d 292, 300.
Under CCP section 340(d), an action for libel or slander must be brought within one year. Libel and slander are the written and spoken types of defamation claims,
The Cross-Complaint includes allegations in paragraph 36 that the Cross-Defendant published the defamatory statements on October 8, 2012. Under CCP section 340(d), the Cross-Complainants had one year, or until October 8, 2013 to bring the claim.
The Cross-Complainant raised these claims in a Cross-Complaint. Under California law, the filing of the Complaint tolls the statute of limitations on causes of action in the Cross-Complaint unless they concern a different party. Boyer v. Jensen (2005) 129 Cal. App. 4th 62, 69. A review of the Court file reveals that the Plaintiff filed the Complaint on December 21, 2012. Since the Complaint was filed within one year of the alleged date of the publication of the defamatory statements, the claims in the Cross-Complaint are timely. Accordingly, the dates in the pleadings do not show that the statute of limitations bars the fifth cause of action.

The Cross-Defendant then argues that the allegations do not demonstrate that she did not have a reasonable belief that her statements were true. However, the Cross-Complaint includes allegations in paragraph 44 that the Cross-Defendants made the statements with knowledge of their falsity. This allegation is assumed true for the purpose of this motion and the Cross-Complainant’s ability to prove the allegations is of no concern. Committee on Children’s Television, Inc. v. General Foods Corp. (1983) 35 Cal.3d 197, 213-214. This allegation is sufficient because if the Cross-Defendant knew that her statement was false, she did not have a reasonable belief that her statement was true. Since this allegation indicates that the Cross-Defendant knew that her statements were false, the pleadings are sufficient.

Therefore, the Court will deny the motion for a judgment on the pleadings as to the fifth cause of action.

2. Sixth Cause of Action for Intentional Infliction of Emotional Distress
The elements of the tort of intentional infliction of emotional distress are the following:

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.”
Christensen v. Superior Court (1991) 54 Cal.3d 868, 903

The Cross-Defendant argues that the conduct alleged is not outrageous. In paragraph 46, the Cross-Complainant alleges that the Cross-Defendants engaged in outrageous conduct by making false accusations with the purpose of harassing and annoying the Cross-Complainants. There are no allegations that identify the outrageous conduct. This is insufficient because it does not plead sufficient facts to demonstrate that the conduct was so extreme as to exceed all bounds of that usually tolerated in a civilized community.
Further, the cause of action is brought by all Cross-Complainants, which includes a corporation, Jimmy Loh and Su Liu, CPA’s, APC. On page 9, at lines 1 to 3 of the opposition, the Cross-Complainants concede that a corporation cannot suffer emotional distress. Accordingly, the claim cannot be brought on behalf of the corporation.

Therefore, the Court will grant the motion for judgment on the pleadings as to the sixth cause of action.

California law imposes the burden on the Cross-Complainants to demonstrate the manner in which they can amend the pleadings to correct the defects in their sixth cause of action. Goodman v. Kennedy (1976) 18 Cal.3d 335, 349. The Cross-Complainants do not meet this burden. Instead, they make a general request for leave to amend without identifying any means by which they could correct this claim by amendment. For example, the Cross-Complainants do not identify any specific conduct that they could claim is outrageous for the purposes of an intentional infliction of emotional distress claim.
Accordingly, the Court will not grant leave to amend.

RULINGS:
DENY motion for judgment on the pleadings as to the fifth cause of action.
GRANT motion for judgment on the pleadings without leave to amend as to the sixth cause of action.