AIC Owner, LLC vs. 8K Productions, LLC

Plaintiff also contends that the agreement is substantively unconscionable because it requires each party to "bear...one half of the charges of the arbitrator," and she cannot afford to bear one-half of AAA arbitration fees. (Comia Decl., ¶ 12.) She cites to Armendariz v. Foundation Health Psychcare Services, Inc. (2000) 24 Cal.4th 83, to support her argument that this renders the agreement substantively unconscionable and unenforceable.

Armendariz does not apply here as its holding on the payment of fees is limited to employment cases for public policy reasons: “When an employer imposes mandatory arbitration as a condition of employment, the arbitration agreement or arbitration process cannot generally require the employee to bear any type of expense that the employee would not be required to bear if he or she were free to bring the action in court. This rule will ensure that employees bringing FEHA claims will not be deterred by costs.” (Armendariz v. Foundation Health Psychcare Services, Inc. (2000) 24 Cal.4th 83, 110–111.)

In the underlying case, Plaintiff agreed to a retainer fee of $5,500.00 and an attorney rate of $400/hour. (Motion, Ex. A.) Furthermore, Defendant Barker declares in reply that throughout his conversations with Plaintiff in 2024 and 2025, he inquired about Plaintiff's financial condition and status for the purpose of evaluating the amount of any punitive damages award to which Plaintiff may have been subject to in the underlying case. Plaintiff informed him that as of 2024/2025, Plaintiff was earning approximately $50,000.00 per year via employment, she received $50,000 per year in child support, she did not pay for childcare, rent or utilities, and all insurance costs for her child was paid for by the child’s father. (Baker Decl., ¶ 1.)

As it currently stands, Plaintiff has not shown that her 1⁄2 of the arbitration fees (which are generally significantly less than the costs of litigating in court) would preclude her access to the arbitration forum. (See Armendariz, supra, 24 Cal.4th at 110–111.)

Therefore, because Plaintiff has not shown that the arbitration agreement is both procedurally and substantively unconscionable, the motion is granted.

Defendants motion includes a request for sanctions in the motion at the end of the memorandum, pursuant to Code Civ. Proc., § 127.5. There is no § 127.5. This does not exist. Defendants likely mean Code Civ. Proc., § 128.5. Sanctions under § 128.5 are not warranted here; the Court does not find that Plaintiff’s Complaint is frivolous or was filed in bad faith. Moreover, Defendants did not provide the 21-day notice as is required.

This matter is hereby stayed pursuant to Code Civ. Proc., § 1281.4. The Court further notes that Defendant Julie C. Lim was not a moving party to this motion to compel arbitration. Thus, the action against Defendant Lim is stayed as well. The Demurrer filed by Defendant Lim currently scheduled for August 3, 2026 is vacated. Additionally, the case management conference set fort July 13, 2026 is vacated.

The Court sets a hearing re: status of arbitration on July 12, 2027 at 10:00 a.m. in Dept. C27.

Moving parties are ordered to give notice.

108 2025-01462176 1. Demurrer to Amended Complaint 2. Case Management Conference

AIC Owner, LLC vs. 8K The Demurrer to the First Amended Complaint brought by Defendant Philip Braun is Productions, LLC OVERRULED, in its entirety.

Initially, while the First Cause of Action confusingly includes all background allegations – including an allegation which identifies Defendant Philip Braun as an individual conducting business in the County of Orange (¶4 of FAC) – the claim nonetheless makes clear that it is asserted solely against Defendant 8K Productions, LLC. (See FAC.) Thus, to the extent Defendant Philip Braun intended to demurrer to this claim, the attempt is rendered MOOT.

With respect to the Second Cause of Action for Breach of Guaranty, “[t]he standard elements of a claim for breach of contract are: ‘(1) the contract, (2) plaintiff’s performance or excuse for nonperformance, (3) defendant’s breach, and (4) damages to plaintiff therefrom.’” (Wall Street Network, Ltd. v. New York Times Co. (2008) 164 Cal.App.4th 1171, 1178.)

Similarly, “[a] lender is entitled to judgment on a breach of guaranty claim based upon undisputed evidence that (1) there is a valid guaranty, (2) the borrower has defaulted, and (3) the guarantor failed to perform under the guaranty.” (Gray1CPB, LLC v. Kolokotronis (2011) 202 Cal.App.4th 480, 486.)

Per the First Amended Complaint, Defendant Philip Braun executed a written Guaranty of Lease, wherein he guaranteed performance of the Lease executed by Defendants 8K Productions and Christopher Emery. (¶18 of FAC and Exhibit 1 thereto.) The First Amended Complaint additionally alleges Plaintiff performed all or substantially all its obligations under the Lease; however, Defendants 8K Productions and Christopher Emery breached the Lease Agreement, by failing to pay all rent that was due and owing from December 2024 through to the end of the lease term. (¶12-¶13 of FAC.) The First Amended Complaint proceeds to allege that Defendant Philip Braun failed to cure the above-described default and, therefore, is in breach of the Guaranty. (¶19 of FAC.)

The above allegations are sufficient to state a claim for Breach of Guaranty.

Within the demurrer, Defendant assert that additional allegations are necessary to show “how Braun breached any enforceable obligation presently due under that Guaranty” (Demurrer: 4:24-26); however, the First Amended Complaint clearly alleges a failure to pay the amounts due and owing under the Lease. (See ¶12-¶13 and ¶19 of FAC.)

Thereafter, Defendant asserts the Complaint fails to allege the specific sums for which Guarantor is liable (Demurrer: 5:5-7); however, the Complaint alleges: “The amount of Base Rent and Additional Rent owed for the period from December 1, 2024 through May 21, 2025 is the sum of $33,000.00, subject to proof at time of trial. They also caused additional damages to the Premises and delayed Plaintiff’s ability to lease the Premises such that total damages are estimated to be $55,000.00, subject to proof at the time of trial.” (¶20 of FAC.)

While Defendant clearly takes the position that additional facts are necessary, Defendant cites no authority which requires more in order to plead a breach of contract claim. At best, Defendant inexplicably offers a general citation to Jones v. Grewe (1987) 189 Cal.App.3d 950 (See Demurrer: 6:20-21), an action which sounds in negligence.

“Every brief should contain a legal argument with citation to authorities on the points made. If none is furnished on a particular point, the court may treat it as waived, and pass it without consideration.” (People v. Stanley (1995) 10 Cal.4th 764, 793.)

To the extent Defendant demurs on the basis the alleged damages are uncertain, this portion of the demurrer is unpersuasive.

While it is true the Complaint alleges rental damages through to May 30, 2025, in the amount of $33,000.00, while also simultaneously asserting lost rental damages estimated in the amount of $55,000.00 (¶12, ¶15 and ¶20 of FAC), these allegations are not so uncertain, as to prevent a response.

“A demurrer for uncertainty is strictly construed, even where a complaint is in some respects uncertain, because ambiguities can be clarified under modern discovery procedures.” (Khoury v. Maly’s of California, Inc. (1993) 14 Cal.App.4th 612, 616.) Additionally, “[d]emurrers for uncertainty are disfavored, and are granted only if the pleading is so incomprehensible that a defendant cannot reasonably respond.” (A.J. Fistes Corp. v. GDL Best Contractors, Inc. (2019) 38 Cal.App.5th 677, 695.)

Based on the above, the demurrer to the Second Cause of Action is OVERRULED.

With respect to the Third Cause of Action, “[t]he common counts are sufficient to state a cause of action upon either a contract implied in fact [citations] or a contract implied in law.” (Kawasho Internat., U.S.A. Inc. v. Lakewood Pipe Service, Inc. (1983) 152 Cal.App.3d 785, 793.) “A common count is proper whenever the plaintiff claims a sum of money due, either as an indebtedness in a sum certain, or for the reasonable value of services, goods, etc., furnished. It makes no difference in such a case that the proof shows the original transaction to be an express contract, a contract implied in fact, or a quasi-contract.” (Ibid.)

Similarly, “[i]n California, it has long been settled the allegation of claims using common counts is good against special or general demurrers.” (Farmers Ins. Exchange v. Zerin (1997) 53 Cal.App.4th 445, 460.) “The only essential allegations of a common count are ‘(1) the statement of indebtedness in a certain sum, (2) the consideration, i.e., goods sold, work done, etc., and (3) nonpayment.’” (Ibid.)

Here, the Third Cause of Action incorporates all prior allegations and asserts: “There is due, owing and unpaid, from Defendants to Plaintiffs in the amount of approximately $55,000.00 for outstanding rental damages and damages to the Premises, subject to proof at the time of trial.” (¶23 of FAC.)

Based on the above, these allegations are sufficient to state a common count.

While Defendant suggests the basis for the common count must be wholly separate from the alleged guaranty, Defendant cites no authority to support this assertion and, consequently, the assertion may be disregarded.

At most, Defendant cites McBride v. Boughton (2004) 123 Cal.App.4th 379, apparently in reliance on the following principle: “When a common count is used as an alternative way of seeking the same recovery demanded in a specific cause of action, and is based on the same facts, the common count is demurrable if the cause of action is demurrable.” (Id. at p. 394.)

As the claim for Breach of Guaranty survives demurrer, the above authority does not support the demurrer to the Third Cause of Action.

Defendant shall file his Answer to the First Amended Complaint within 10 days.

The case management conference is continued to November 16, 2026 at 10:00 a.m. in Department C27.

Plaintiff is ordered to give notice.

109 2025-01532667 1. Demurrer to Complaint 2. Case Management Conference NeueHealth Advantage ACO The demurrer of Defendants MD Health, Inc., and MD Partners, Inc. to all three causes of LLC vs. MD Health action in Plaintiff NeueHealth Advantage ACO, LLC’s complaint is SUSTAINED with 15 days Inc leave to amend.

Discussion. Defendants demur generally to all three causes of action in the complaint, which are for breach of contract, breach of the implied covenant of good faith and fair dealing, and declaratory relief. Plaintiff opposes the demurrer.

Moving defendants contend that the first two causes of action for breach of contract and breach of the implied covenant of good faith and fair dealing fail to state any claim against them because neither is a party to the agreement alleged in the complaint, which is between Plaintiff and non-party MD Partners ACO. They further contend that Plaintiff does not set forth any factual allegations by which liability may be imposed on them as non-signatories to the agreement, e.g., alter ego theory, agency, or estoppel.

In fact, the agreement attached to the complaint as Exhibit A is between Plaintiff NeueHealth Advantage ACO, LLC (under its former name, Physicians Plus ACO, LLC) and non-party MD Partners ACO and states that it is effective as of May 10, 2022. In addition, Plaintiff alleges in several places in the complaint that the contract is between it and non- party MD Partners ACO. (See, e.g., paragraphs 15, 28, and 34, which are in the introductory portion of the complaint, the first cause of action, and the second cause of action, respectively.) Plaintiff does not allege that non-party MD Partners ACO was acting as an agent on behalf of a principal when it entered into the agreement.

In the first cause of action, Plaintiff alleges that non-party MD Partners ACO breached the agreement by failing to provide a financial guarantee in a form and substance satisfactory to Plaintiff as required by the agreement and that Plaintiff was damaged as a result. (Complaint, ¶¶ 30 and 31.) It then alleges that the moving defendants “are liable for the contractual obligations and duties of MD Partners ACO under the agreement.” (Complaint, ¶ 32.)

There are absolutely no facts in the complaint to support Plaintiff’s conclusion that moving defendants are liable to it for the non-party’s breach of contract. As pointed out in the moving papers, the introductory portion of the complaint contains only boilerplate and factually devoid allegations – made on information and belief -- that each named defendant is the agent, alter ego, servant, or employee of each of the other defendants and acting within the scope of the agency or employment. (Complaint, ¶ 6.)

The introductory portion of the complaint also contains boilerplate allegations – again based on information and belief – that the named defendants, non-party MD Partners ACO, and fictitiously named defendants are the alter egos of each other. (Complaint, ¶¶ 7.) These allegations are insufficient to impose liability against the named defendants for a breach of the agreement by non-party MF Partners ACO.