2014-00159565-CU-WT

Arend Wheeler vs. Laguna Asset Management, Inc.

Nature of Proceeding:   Hearing on Demurrer

Filed By:  McQuarrie, Jennifer L.
Filed By:  McQuarrie, Jennifer L.

Defendant’s Demurrer to the Complaint is ruled on as follows:

Plaintiff alleges that he was the on-site maintenance manager at defendant’s trailer
park.  Plaintiff alleges he received raises and praise with regard to his job
performance.  He began working for defendant’s predecessor in 2011.  Plaintiff does
not allege when he became employed by defendant.

Plaintiff alleges that he was terminated in violation of public policy and in retaliation for
testifying pursuant to subpoena about a shooting that had occurred at the trailer park.
Plaintiff alleges that he received death threats from residents of the trailer park before
he testified.  Tony Garcia is alleged to be defendant’s Regional Supervisor, who
agreed to allow plaintiff to have time off to testify and later to transfer to another facility
to minimize his contact with the threatening individuals.  (Complaint, ¶ 12-13)  Plaintiff
alleges that after he testified he called Garcia to accept the transfer offer but instead
he was terminated for abandoning his job.  When plaintiff suggested pursuing the
matter in court, Garcia allegedly told him: “Who do you think they are going to believe-
someone who lives in Laguna Hills or someone who lives in a trailer park with no
money?”  Plaintiff alleges the true reason for the termination was in retaliation for
testifying pursuant to the subpoena.

1st cause of action Wrongful Termination in Violation of Public Policy:  No demurrer.
2nd cause of action: Retaliation in Violation of Labor Code section 1102.5:  No
demurrer.

3rd cause of action Breach of the Implied Contract not to terminate absent good
cause:  Sustained with leave to amend for failure to state facts sufficient to constitute a
cause of action. The allegations imply that plaintiff only worked for defendant for a few
months.  Plaintiff does not allege a totality of circumstances that would state a cause of
action for breach of the implied covenant not to terminate but for good cause.  The fact
that he received frequent praise and obtained raises, coupled with the brief
employment, is insufficient as a matter of law to state a claim.  Employment in
California is presumed to be at-will. Labor Code § 2922. The totality of the
circumstances must be examined to determine whether the parties’ conduct give rise
to an implied- in-fact contract limiting the employer’s termination rights.  Guz v. Bechtel
Nat. Inc. (2000) 24 Cal. 4th  317,337. Several factors may bear upon the existence of
such a contract, such as “personnel  policies or practices of the employer, the
employee’s longevity of service, actions or communications by the employer reflecting
assurances of continued employment, and the practices of the industry in which the
employee is engaged.” Id. at 336-37 (citations omitted).  Plaintiff has not alleged any of
the factors such as long employment, assurances of continued employment, personnel
policies etc.

4th cause of action Breach of the Implied Covenant of Good Faith and Fair
Dealing:  Sustained with leave to amend for failure to state facts sufficient to constitute
a cause of action.  Plaintiff does not allege a valid underlying contract upon which to
base this cause of action.

5th cause of action Negligent Hiring and Retention:  Sustained with leave to amend
for failure to state facts sufficient to constitute a cause of action.  Plaintiff has not
alleged facts to support a claim for negligent hiring.   Plaintiff only alleges that              defendant knew of Garcia’s conduct during his employment.   Moreover, although a
cause of action can be stated by third persons against an employer for negligent hiring
of an employee, the Court has concerns as to whether a claim for negligence can
appropriately be brought in this forum by an employee who is injured by his own
employer’s hiring practices.

6th cause of action Intentional Infliction of Emotional Distress: Overruled.  The
allegations that plaintiff was intentionally terminated in violation of public policy coupled
with the statements made by Garcia in connection with the termination are sufficient to
allege a claim for emotional distress.

Plaintiff may file and serve an Amended Complaint no later than July 7, 2014.
Response to be filed and served within 15 days of service of the amended complaint,
20 days if served by mail.

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

Item  15    2014-00159565-CU-WT

Arend Wheeler vs. Laguna Asset Management, Inc.

Nature of Proceeding:   Motion to Strike

Filed By:  McQuarrie, Jennifer L.

Defendant’s Motion to Strike is ruled on as follows:

Plaintiff alleges that he was the on-site maintenance manager at defendant’s trailer
park.  Plaintiff alleges he received raises and praise with regard to his job
performance.  He began working for defendant’s predecessor in 2011. Plaintiff does
not allege when he became employed by defendant.  Plaintiff alleges that he was
terminated in violation of public policy and in retaliation for testifying pursuant to
subpoena about a shooting that had occurred at the trailer park.  Plaintiff alleges that
he received death threats from residents of the trailer park before he testified.  Tony
Garcia is alleged to be defendant’s Regional Supervisor, who agreed to allow plaintiff
to have time off to testify and later to transfer to another facility to minimize his contact
with the threatening individuals.  (Complaint, ¶ 12-13)  Plaintiff alleges that after he
testified he called Garcia to accept the transfer offer but that he was terminated for
abandoning his job.  When plaintiff suggested pursuing the matter in court, Garcia
allegedly told him:” Who do you think they are going to believe- someone who lives in
Laguna Hills or someone who lives in a trailer park with no money?”  Plaintiff alleges
the true reason for the termination was in retaliation for testifying pursuant to the
subpoena.

Defendant seeks to strike the 2nd cause of action for Retaliation under Labor 1102.5
and the punitive damages language.

Punitive damages:  Denied.  The 1st and 6th causes of action support a claim for
punitive damages.            Labor Code 1102.5:  Denied.   The inclusion of this statute is not “improper, irrelevant
or contrary to law under CCP 435.   Plaintiff’s allegations that he was terminated for
testifying pursuant to a subpoena are sufficient under Labor Code 1102.5(c). (“An
employer, or any person acting on behalf of the employer, shall not retaliate against an
employee for refusing to participate in an activity that would result in a violation of state
or federal statute, or a violation of or noncompliance with a local, state, or federal rule
or regulation.”)

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