Case Name:   Varteressian v. John R. Lund, D.D.S., et al.

Case No.:       1-14-CV-266573

After full consideration of the arguments and authorities submitted by each party, the court makes the following rulings:

In the first amended complaint (“FAC”), plaintiff Laura Varteressian (“Plaintiff”) alleges that she turned 65 on August 26, 2011, and defendants John R. Lund, D.D.S. (“Lund”), John R. Lund, D.D.S., Inc., and Does 1-40 (collectively, “Defendants”)—acting as agents of one another—agreed to diagnose and treat her dental conditions from April 17, 2003 to January 2012.  (FAC, ¶¶ 13, 16-17, & 88.)  Plaintiff further alleges that on 21 occasions, Lund knowingly misrepresented to her that she needed treatments that were actually unnecessary with the intent to induce her to rely on his statements and consent to the treatments, and she did justifiably rely on the statements by allowing Defendants to perform the procedures.  (Id., ¶¶ 20-63.)  Also, Defendants allegedly charged Plaintiff for six incision and drainage procedures that they never performed with the intent to defraud her.  (Id., ¶¶ 79-81 & 89-90.)

Plaintiff asserts causes of action against Defendants for (1) fraud and deceit, (2) battery, (3) fraudulent billing, (4) financial elder abuse, (5) common count (money had and received), and (6) violation of Penal Code section 496.  Defendants demur to each cause of action on the grounds of failure to state a claim and uncertainty, and move to strike portions of the complaint on the ground that they are irrelevant or improper matters.  (See Code Civ. Proc. [“CCP”], §§ 430.10, subds. (e)-(f) & 436, subd. (a).)

Defendants’ request for judicial notice of the FAC in support of their demurrer is GRANTED.  (See Evid. Code, § 452, subd. (d).)

The demurrer for uncertainty is OVERRULED.  (See Khoury v. Maly’s of California, Inc. (1993) 14 Cal.App.4th 612, 616 [demurrer for uncertainty is strictly construed because ambiguities can be clarified under modern discovery procedures].)

The demurrer for failure to state a claim to the first cause of action (fraud and deceit) is SUSTAINED WITH 10 DAYS’ LEAVE TO AMEND.  Plaintiff does not specifically allege how Lund made the 21 false representations (i.e. whether the statements were oral or written).  (See Lazar v. Super. Ct. (1996) 12 Cal.4th 631, 645 [fraud allegations must be pleaded with particularity and “show how, when, where, to whom, and by what means the representations were tendered”].)

The demurrer for failure to state a claim as to the second cause of action (battery) is OVERRULED.  Although a claim for battery is subject to a two-year statute of limitations (CCP, § 337.1), “for the bar of the statute of limitations to be raised by demurrer, the defect must clearly and affirmatively appear on the face of the complaint” (Marshall v. Gibson, Dunn & Crutcher (1995) 37 Cal.App.4th 1397, 1403).  “When a plaintiff relies on a theory of fraudulent concealment, delayed accrual, equitable tolling, or estoppel to save a cause of action that otherwise appears on its face to be time-barred, he or she must specifically plead facts which, if proved, would support the theory.”  (Mills v. Forestex Co. (2003) 108 Cal.App.4th 625, 641 [“Mills”].)  Plaintiff alleges that Defendants repeatedly battered her before January 2012 (FAC, ¶¶ 16, 20-63, & 74), and she filed this action over two years later.  However, Plaintiff alleges that Defendants obtained her consent by fraud—i.e. they intentionally misrepresented that she required treatments that were unnecessary—and she did not learn of their fraud until her new dentist, Brendon Zeidler, D.D.S. (“Zeidler”), informed her of it in October 2013.  (Id., ¶ 64.)  She further alleges that she acted with diligence and could not have discovered Defendants’ fraud before then because she has no special knowledge of dentistry and her reliance on Lund’s representations was reasonable due to their fiduciary/patient-doctor relationship and his professed expertise, and thus, she did not seek a second opinion as to the need for treatment.  (Id., ¶¶ 63-64.)  These allegations are sufficient to plead that the battery claim is not time-barred.  (See Warrington v. Charles Pfizer & Co. (1969) 274 Cal.App.2d 564, 569-570 [discovery rule applies to personal injury claims]; see also Battuello v. Battuello (1998) 64 Cal.App.4th 842, 847-848 [defendant is equitably estopped from asserting the statute of limitations defense where its fraud/concealments induced the plaintiff to delay].)  Also, by alleging that Defendants obtained her consent by fraud, Plaintiff adequately pleads lack of consent.  (See Weinstock v. Eissler (1964) 224 Cal.App.2d 212, 233-234 [battery based on the allegation that a health care provider obtained consent by fraud, i.e. concealed that the procedure was unnecessary].)  Defendants cite no legal basis for their assertion that facts showing that the consent was obtained by fraud must be specifically alleged to support a battery claim.

The demurrer for failure to state a claim as to the third, fifth, and sixth causes of action (fraudulent billing, common count, and violation of Penal Code, § 496) is OVERRULED.  Plaintiff specifically alleges facts in support of each element of her fraudulent billing claim.  (See Charnay v. Cobert (2006) 145 Cal.App.4th 170, 185 [plaintiff stated a fraudulent billing claim by alleging the defendant billed for tasks not actually performed].)  Defendants assert that the demurrer to the common count claim should be sustained because it is based on the same allegations as the fraudulent billing claim.  Since Plaintiff has adequately pleaded her fraudulent billing claim, Defendants’ argument lacks merit.  Lastly, the violation of Penal Code section 496 claim is not barred by the statute of limitations because it is not deemed to have accrued until Plaintiff allegedly discovered Defendants’ fraud in October 2013.  (FAC, ¶ 64; see also Mills, supra, at p. 641; see also CCP, § 338, subd. (d) [“[a]n action for relief on the ground of fraud or mistake . . . is not deemed to have been accrued until the discovery, by the aggrieved party, of the facts constituting the fraud or mistake”].)

The demurrer for failure to state a claim as to the fourth cause of action (elder financial abuse) is SUSTAINED WITH 10 DAYS’ LEAVE TO AMEND.  Defendants cite no legal authority in support of their assertion that Plaintiff must specifically allege facts in support of a fraud claim in order to support the “intent to defraud” element of an elder abuse claim.  Regardless, since she also alleges that Defendants knew or should have known that their conduct was likely to be harmful to her, she adequately alleges that Defendants retained her money for a “wrongful” use.  (FAC, ¶ 90; see also Welf. & Inst. Code, § 15610.30, subds. (a)-(b) [elder financial abuse requires that a person or entity obtain/retain the elder’s money for a “wrongful use,” with the “intent to defraud,” or by “undue influence,” and “wrongful use” means that the defendant “knew or should have known that this conduct is likely to be harmful to the elder”].)  Plaintiff alleges that Defendants each retained her money and assisted each other in obtaining and/or retaining her money (FAC, ¶¶ 88-89); however, the only specifically alleged incidents occurred before Plaintiff turned 65.  (FAC, ¶¶ 20-63 & 79.)  Plaintiff does not specifically allege when and by what means Defendants obtained/retained her money after she turned 65, and she cannot state a claim for elder abuse for events that occurred before she turned 65.  (See Welf. & Inst. Code, § 15610.27 [elder is a person 65 or older]; see also Covenant Care, Inc. v. Superior Court (2004) 32 Cal.4th 771, 790 [statutory causes of action must be pleaded with particularity].)

Defendants’ motion to strike portions of the FAC is DENIED.  In paragraph 64, Plaintiff alleges that she learned of Defendants’ fraud when Zeidler informed her of it, and that Zeidler filed an action against Lund (Zeidler v. Lund, et al., Santa Clara County Super. Ct. Case No. 1-13-CV-255043) alleging Lund had a “practice of performing unnecessary root canals” and “endodontic procedures such as incision and drainage and placing pulp caps,” placing “crowns on teeth without the clinical indication for placing a crown, and generally [overtreating] patients.”  These alleged matters are relevant to whether the discovery rule and/or equitable estoppel apply to Plaintiff’s battery claim.  To the extent Defendants assert it is improper for Plaintiff to repeat Zeidler’s allegations, their argument lacks merit because “it has been held that basing [a pleading] on hearsay is expressly authorized.”  (See Wuest v. Wuest (1942) 53 Cal.App.2d 339, 344.)  In paragraph 80, in support of her fraudulent billing claim, Plaintiff alleges—based on information and belief—that Defendants did not actually perform the work that they billed her for, and alleges facts giving rise to her information and belief (i.e. that she has no memory of the procedures being necessary or performed, Defendants’ documentation and “objective testing” do not indicate that the procedures were necessary, and “as a statistical anomaly, the chances that any patient of plaintiff’s age and health would require six different incision and drainage procedures on six different teeth in the lower arch during a period of less than 30 months is infinitesimally remote”).  Plaintiff properly alleges that Defendants did not actually perform the procedures based on information and belief because she lacks personal knowledge of the matter.  (See Pridonoff v. Balokovich (1991) 36 Cal.2d 788, 792 [allegations based on information and belief are proper where the pleader lacks personal knowledge]; see also Mirich v. Balsinger (1942) 53 Cal.App.2d 103, 112-113 [facts learned from health care providers may be alleged on information and belief]; see also Lewis v. Beeks (1948) 88 Cal.App.2d 511, 521 [facts supporting a fraud claim that are within the defendant’s personal knowledge may be alleged on information and belief].)  Defendants’ contention that it is improper to allege the facts giving rise to a pleader’s information and belief is unavailing and contrary to the rule that “it is not sufficient to allege fraud or its elements upon information and belief, unless the facts upon which the belief is founded are stated in the pleading.”  (See Dowling v. Spring Valley Water Co. (1917) 174 Cal. 218, 221.)  Finally, Defendants argue that the alleged “statistical anomaly” should be stricken because it is “quite possibly false.”  Since, on a motion to strike, the allegations in the pleading are considered to be true, Defendants’ argument is not well-taken.  (See Clauson v. Super. Ct. (1998) 67 Cal.App.4th 1253, 1255.)

The Court will prepare the order.