Case Number: BC540111    Hearing Date: August 04, 2014    Dept: 92

SUPERIOR COURT OF THE STATE OF CALIFORNIA FOR THE COUNTY OF LOS ANGELES – CENTRAL DISTRICT

ANAHID AREKERIANS-ABELIAN,
Plaintiff(s),
vs.
GERLACH’S GRILL, et al.,
Defendant(s).

Case No.: BC540111

[TENTATIVE] ORDER SUSTAINING DEMURRER; GRANTING MOTION TO STRIKE; GRANTING LEAVE TO AMEND

Dept. 92
1:30 p.m. — #30
August 4, 2014

Defendant, Gerlach’s Grill’s Demurrer is Sustained. Defendant’s Motion to Strike is Granted. Plaintiff is ordered to file a First Amended Complaint within twenty days. Defendant is ordered to file a responsive pleading within the statutory time thereafter.

Plaintiff, Anahid Arekerians-Abelian filed this action against Defendant, Gerlach’s Grill for damages arising out of a food poisoning incident that occurred on 3/21/12. Plaintiff’s complaint includes causes of action for strict products liability (failure to warn), strict products liability (negligence), breach of express warranty, breach of implied warranty, negligence, and fraud.

Defendant, Gerlach’s demurs to the sixth cause of action for fraud, contending it fails to state a cause of action and is uncertain. The sixth cause of action is premised primarily on the following allegation:
52. Defendants in the manufacturing, marketing and distribution at the retail level to the public of the product materially misrepresented to the public, including Plaintiff, that the subject products were safe and free from contamination. Commencing in March, 2012 defendants, and each of them, knew or should have known that their products were contaminated with a dangerous and virulent strain of E. coli bacteria, salmonella and/or other food contaminants. In spite of this knowledge, defendants intentionally concealed this information from the public, including Plaintiff.

The elements of fraud are: (1) misrepresentation (false representation, concealment, or nondisclosure); (2) knowledge of falsity (scienter); (3) intent to defraud or induce reliance; (4) justifiable reliance; and (5) damages. (See Civil Code ¿1709.) Fraud actions are subject to strict requirements of particularity in pleading. (Committee on Children¿s Television, Inc. v. General Foods Corp. (1983) 35 Cal. 3d 197, 216.)

Since allegations of fraud involve a serious attack on character, fairness to the defendant demands that he should receive the fullest possible details of the charge in order to prepare his defense. Accordingly the rule is everywhere followed that fraud must be specifically pleaded, such that: (a) General pleading of the legal conclusion of ¿fraud¿ is insufficient; the facts constituting the fraud must be alleged; and (b) Every element of the cause of action for fraud must be alleged in the proper manner (i.e., factually and specifically), and the policy of liberal construction of the pleadings will not ordinarily be invoked to sustain a pleading defective in any material respect. (Id.)

¿Consistent with the rule requiring specificity in pleading fraud, a complaint must state ultimate facts showing that the defendant intended or had reason to expect reliance by the plaintiff or the class of persons of which he is a member.¿ (Geernaert v. Mitchell (1995) 31 Cal. App. 4th 601, 608.) A plaintiff must allege what was said, by whom, in what manner (i.e. oral or in writing), when, and, in the case of a corporate defendant, under what authority to bind the corporation. (See Goldrich v. Natural Y Surgical Specialties, Inc. (1994) 25 Cal.App.4th 772, 782.)

The problem with Plaintiff’s complaint is that it alleges Defendant knew the food was contaminated, but it fails to allege any facts to support that legal conclusion. Similarly, fraudulent intent is pled in conclusory terms, but no facts to show fraudulent intent are pled. To be sure, fraudulent intent must often be established by circumstantial evidence. Fraudulent intent has been inferred from such circumstances as defendant’s insolvency, his hasty repudiation of the promise, his failure even to attempt performance, or his continued assurances after it was clear he would not perform. The defendant’s intent not to perform may also be shown by direct evidence, such as: (1) a defendant’s admission in documents showing defendant planned not to perform; (2) circumstantial evidence that the defendant could not have performed, such as defendant had already been denied necessary permits; or (3) that defendant had demonstrated a pattern of making representations that were never performed. (Tenzer v. Superscope, Inc. (1985) 39 Cal.3d 18, 30-31.)

Plaintiff has failed to plead facts tending to support the conclusion that Defendant knew the food was contaminated. Plaintiff has failed to plead facts tending to support the conclusion that Defendant intended to suppress the contamination or intended to misrepresent the food’s fitness for consumption to Plaintiff. The demurrer is therefore sustained. Leave to amend is granted if and only if Plaintiff can plead such facts.

Defendant also moves to strike various allegations concerning misrepresentation from the complaint, as well as all references to punitive damages. Because the sole basis for imposition of punitive damages in the complaint is the alleged fraudulent conduct, the motion to strike is granted. Again, leave to amend is granted if and only if Plaintiff can plead specific facts as discussed above.

Dated this 4th day of August, 2014

Hon. Elia Weinbach
Judge of the Superior Court