Marshall Sperbeck vs. Capital Christian Center

Plaintiffs allege that Sperbeck, Lepisi, Armbrust, Sorgea, and Garza were all members of

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Defendant’s Executive Leadership team, and were required to meet with the lead applicant for the new Head of School — Tim Wong (“Wong”). During Wong’s interviews with Plaintiffs, Wong was not interested in school matters and instead focused on the personal backgrounds of Plaintiffs and the other members on the team, asking inappropriate questions and focusing on racial stereotypes. (SAC, ¶ 37.) Plaintiffs also learned that Wong’s prior employer had informed Defendants that during Wong’s prior employment he had exceeded his authority and attempted to terminate staff and replace them with his family members and also took actions to benefit his personal financial interest over that of his employer’s. (SAC, ¶ 38.)

Plaintiffs allege that before Wong was formally hired, they spoke with Rick Cole (“Cole”), the Pastor at CCC, to warn against Wong’s hire and expressed their concerns that Wong would engage in financial malfeasance and terminate their employment. (SAC, ¶ 39.) They allege that Cole expressly promised each of them that the leadership team need not worry about their employment and that their jobs were secure even if Defendants hired Wong. Cole stated that he would “have their backs” or words substantially to that effect if Wong attempted to fire any of the Plaintiffs. (SAC, ¶ 40.)

Wong was ultimately hired in January 2020, although he was not set to begin work until the next school year that fall. Despite this, Wong was present on campus beginning in January 2020 and “continued to question Plaintiffs inappropriately on matters including but not limited to their race, ethnic background, and questioning their religious beliefs.” (SAC, ¶ 42.) Plaintiffs allege that Wong then terminated each of them, despite Plaintiffs having years of stellar performance reviews, and replaced them with “his friends, close family members and/or people that aligned with his racial, ethnic, and religious beliefs.” (SAC, ¶ 44.)

Plaintiffs allege Defendants told them that their termination was either due to a restructuring of their position or lack of funding because of COVID-19. (SAC, ¶ 45.) They allege that the representations were false because at least two of the Plaintiffs were fired prior to the imposition of school closures during COVID-19. (SAC, ¶ 46.) Defendants applied for and received funds from the COVID-19 related Paycheck Protection Program (“PPP”). In order to secure those funds, Defendants were required to provide information regarding staff downsizing and to make assurances that they would retain current employees or rehire employees who lost their positions due to lack of funding. (SAC, ¶¶ 48-49.)

Although Plaintiffs’ employment information was included in the application for PPP fund, Plaintiffs were not re-hired. Rather, Wong hired replacements for the same duties that the Plaintiffs performed, some at a higher rate of pay. (SAC, ¶¶ 47, 50.)

Trial is currently scheduled for August 19, 2025.

Defendants demur to the causes of action for: Breach of Contract [Sperbeck, Lepisi, Armbrust, Sorgea, Garza v. Defendants] (COA 2); Fraud — False Promise / Misrepresentation [Sperbeck v. Defendants] (COA 3); Fraud — False Promise / Misrepresentation [Armbrust, Lepisi, Garzam Sorgea v. Defendants] (COA 5); and Breach of Contract [Navolio v. Capital Christian Center] (COA 6) on the grounds that “the complaint is legally and factually deficient regarding alleged

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acts committed against the Plaintiffs.” (Demurrer, 1:24-26.)

Legal Standard

The function of a demurrer is to test the sufficiency of the pleading it challenges by raising questions of law. (Salimi v. State Comp. Ins. Fund (1997) 54 Cal.App.4th 216, 219; Nordlinger v. Lynch (1990) 225 Cal.App.3d 1259, 1271.)

A demurrer and a motion to strike “tests the pleadings alone and not the evidence or other extrinsic matters.” (SKF Farms v. Superior Court (1984) 153 Cal.App.3d 902, 905.) The purpose of a demurrer is to test the legal sufficiency of a claim. (Donabedian v. Mercury Ins. Co. (2004) 116 Cal.App.4th 968, 994.) For the purpose of determining the effect of a complaint, its allegations are liberally construed, with a view toward substantial justice. (Code Civ. Proc. §452; Amarel v. Connell (1988) 202 Cal.App.3d 137, 140-141; Quelimane Co. v.

Stewart Title Guaranty Co. (1998) 19 Cal.4th 26, 43, fn. 7.) In this respect, the Court treats the demurrer as admitting all material facts properly pleaded, but not contentions, deductions or conclusions of fact or law, and considers matters which may be judicially noticed. (Blank v. Kirwan (1985) 39 Cal.3d 311, 318; Poseidon Development, Inc. v. Woodland Lane Estates, LLC (2007) 152 Cal.App.4th 1106, 1111-1112.) A general demurrer does not admit contentions, deductions, or conclusions of fact or law alleged in the complaint; facts impossible in law; or allegations contrary to facts of which a court may take judicial notice. (Blank v.

Kirwan (1985) 39 Cal.3d 311, 318, William S. Hart Union High School Dist. v. Regional Planning Com. (1991) 226 Cal.App.3d 1612, 1616 n.2.) Extrinsic evidence may not properly be considered on demurrer or on a motion to strike. (Ion Equipment Corp. v. Nelson (1980) 110 Cal.App.3d 868, 881; Hibernia Savings & Loan Soc. v. Thornton (1897) 117 Cal. 481, 482.)

A demurrer may be sustained only if the complaint lacks any sufficient allegations to entitle the plaintiff to relief. (Financial Corp. of America v. Wilburn (1987) 189 Cal.App.3d 764, 778.) “Plaintiff need only plead facts showing that he may be entitled to some relief . . ., we are not concerned with plaintiff’s possible inability or difficulty in proving the allegations of the complaint.” (Highlanders, Inc. v. Olsan (1978) 77 Cal.App.3d 690, 696-697.) “[Courts] are required to construe the complaint liberally to determine whether a cause of action has been stated, given the assumed truth of the facts pleaded.” (Picton v.

Anderson Union High School Dist. (1996) 50 Cal.App.4th 726.) A demurrer admits the truth of all material facts properly pled and the sole issue raised by a general demurrer is whether the facts pled state a valid cause of action – not whether they are true. (Serrano v. Priest (1971) 5 Cal.3d 584, 591.)

Breach of Contract [Sperbeck, Lepisi, Armbrust, Sorgea, Garza v. Defendants] (COA 2)

In Plaintiffs’ FAC, the breach of contract cause of action was asserted only by Sperbeck, and the Court overruled Defendants’ demurrer to this cause of action. In the SAC, Plaintiffs have now

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added Lepisi, Armbrust, Sorgea, and Garza as plaintiffs in asserting this cause of action.

Defendants argue that the cause of action should be dismissed against Lepisi, Armbrust, Sorgea, and Garza because they were not given leave to amend to add them to this cause of action.

In opposition, Plaintiffs suggest that the addition is proper because:

Plaintiffs asserted they had claims for breach of contract when the original complaint was filed on January 29, 2021, but did not initially file their complaint for breach of contract in the superior court because the language of the arbitration agreements was restrictive and adverse to prevailing law. Expecting that the declaratory relief cause of action would be determined quickly when the action was filed, they were dismayed at the delays caused by world and court events.[1] They should not be precluded from pursuing a claim that they originally held, originally pled and sought declaratory relief to assist them in how to proceed.

There is no “surprise” here; and Defendant has been on notice since day one of Plaintiff’s [sic] claim that Defendants breached their contract by failing to do the most minimal of acts vis-a-vis, respond to a written request to arbitrate. The Declaratory Relief Cause of Action has never been a stand alone cause of action - if, in fact, the law seeks to have matters heard based upon their merits, it follows that once the Court determines the rights and obligations of the parties under the terms of the agreement, the parties can follow on with their cause of action for breach of the contract.

(Opposition, 3:20-4:7.)

Plaintiffs’ argument does not refute Defendants’ argument that they were not given leave to amend to add Lepisi, Armbrust, Sorgea, and Garza to this cause of action.

When a trial court sustains a demurrer with leave to amend, the scope of the grant of leave is ordinarily a limited one. It gives the pleader an opportunity to cure the defects in the particular causes of action to which the demurrer was sustained, but that is all. (See Community Water Coal. v. Santa Cruz Cty. Local Agency Formation Com. (2011) 200 Cal App. 4th 1317, 1329; see also Harris V. Wachovia Mortg., FSB (2010)185 Cal App. 4th 1018, 1023.) Thus, a plaintiff may not amend the complaint to add a new cause of action without having obtained permission to do so, unless the new cause of action is within the scope of the order granting leave to amend. (Community Water Coalition v.

Santa Cruz County Local Agency, supra, 200 Cal.App.4th at 1329.) Thus, a plaintiff may not amend the complaint to add a new cause of action without first having obtained permission to do so unless the new cause of action is within the scope of the order granting leave to amend. An amended complaint that exceeds the scope of an order granting leave to amend may be stricken by a trial court in its own discretion or upon a motion to strike by the opposing party. (Code Civ. Proc., §§ 435, 436.)

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Here, it is clear that Plaintiffs were not given leave to amend this cause of action. Accordingly, the Court, in its own discretion, STRIKES Lepisi, Armbrust, Sorgea, and Garza from this cause of action.

Breach of Contract [Sperbeck, Lepisi, Armbrust, Sorgea, Garza v. Defendants] (COA 2)

Defendants also demur to this cause of action on the ground that Plaintiffs attempt to improperly plead around the first cause of action for declaratory relief which asserts that the arbitration agreements are invalid. According to Defendants, the proper remedy is a petition to compel arbitration, and there is no authority to allow Plaintiffs to proceed on this theory of breach of contract. Defendants insist that “Plaintiffs cannot have it both ways. If they want to proceed to compel the Defendant to proceed to arbitration, the proper mechanism is filing the aforementioned petition to compel arbitration not a breach of contract cause of action.” (Demurrer, 6:9-11.)

The demurrer is OVERRULED. Defendants provide no legal authority that Plaintiffs may not plead these two inconsistent theories in the alternative. The only legal authority cited by Defendants is Code of Civil Procedure section 1281.2 which merely concerns a petition to compel arbitration.

The Court did not consider Defendants’ argument, raised for the first time in reply, that this cause of action is time barred and does not relate back to the original complaint.

Fraud — False Promise / Misrepresentation [Sperbeck v. Defendants] (COA 3)

This cause of action is based on fraudulent inducement and fraudulent misrepresentation.

Plaintiffs allege that in early 2018, Defendants actively recruited Sperbeck to join CCC while he was employed with Jesuit High School. (SAC, ¶ 78.) During the recruitment process Sperbeck told Cole that he was unwilling to leave his position with Jesuit unless CCC could match his compensation in his then-current position. (SAC, ¶ 79.) In response, Cole promised Sperbeck a guaranteed five-year employment term with comparable perks to Sperbeck’s position with Jesuit. (SAC, ¶ 81.) Cole also told Sperbeck the Defendants had secured the funding to pay his salary, including a portion of which would be paid by one of the school’s prominent donors. (SAC, ¶ 82.)

Cole and Sperbeck met directly with the donor to confirm his commitment to pay portions of Sperbeck’s salary for each of the next five years. (SAC, ¶ 83.) Plaintiffs allege that Cole’s statements and promises were false and made to induce Sperbeck to leave his Jesuit position. (SAC, ¶ 89.) Plaintiffs allege that Cole knew the statement and promises were false because: (1) he knew that donor funds could not be designated for a particular employee’s salary, and (2) the terms were not included in the original offer of employment, Defendants had never made an employment agreement for a five-year term, and Cole evaded discussions about his previous

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promises after Sperbeck was hired. (SAC, ¶¶ 90-91.)

Plaintiffs further allege that prior to Wong’s hiring, Cole expressly promised each of them that the leadership team need not worry about their employment and that their jobs were secure. (SAC, ¶ 97.) Cole told Sperbeck that his contract term was secure and that Wong would not replace Sperbeck. (SAC, ¶ 98.) Sperbeck was terminated on March 3, 2020. (SAC, ¶ 107.)

Defendants demur on the grounds that Plaintiffs fail to plead actionable scienter. According to Defendants, because Plaintiffs plead that Sperbeck met with the donor to confirm his commitment to pay portions of Sperbeck’s salary for each of the next five years, Sperbeck independently validated Defendants’ representations, and Plaintiffs cannot plead facts that Defendants had any knowledge that the donor’s representations were false. (Demurrer, 7:24-26.) Defendants further argue that Plaintiffs fail to plead that Sperbeck justifiably relied on Defendants’ representation or that Defendants knew that the donor’s representations were false. Defendants lastly contend that Plaintiffs fail to plead that Cole had any knowledge that Wong intended to terminate Sperbeck’s employment at the time the alleged offer was made.

Plaintiffs do not expressly address Defendants’ arguments regarding Sperbeck confirming the statements that a donor would pay portions of Sperbeck’s salary or that they fail to plead that Cole had any knowledge that Wong intended to terminate Sperbeck’s employment at the time the alleged offer was made. Instead, they argue that they sufficiently allege promissory fraud, citing Moncada v. W. Coast Quartz Corp. (2013) 221 Cal.App. 4th 768.

The Court disagrees with Plaintiffs that they have sufficiently alleged promissory fraud. As explained in Moncada, “‘Promissory fraud’ a subspecies of the action for fraud and deceit. “A promise to do something necessarily implies the intention to perform; hence, where a promise is made without such intention, there is an implied misrepresentation of fact that may be actionable fraud.’” (Moncada, supra, 221 Cal.App.4th at 776.) One element of promissory fraud is that the defendant “did not intend to perform this promise when [he/she/nonbinary pronoun] made it.” (1 CACI 1902.) Here, Plaintiffs fail to allege that Cole made the promises without an intention to perform.

Accordingly, the demurrer is SUSTAINED with leave to amend.

Fraud — False Promise / Misrepresentation [Armbrust, Lepisi, Garzam, Sorgea v. Defendants] (COA 5)

This cause of action is based on Cole’s promise that the leadership team need not worry about their employment and that their jobs were secure. (SAC, ¶ 97.) Plaintiffs further allege that after Wong’s hiring he targeted Lepisi and Sperbeck, and terminated Lepisi on March 13, 2020. (SAC, ¶ 138.) After Lepisi’s termination, Cole met with Armbrust, Garzam and Sorgea and stated that he would block any attempt by Wong to terminate their positions and that he would “have their

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backs” at all times, or words substantially to that effect. (SAC, ¶ 139.) Armbrust, Garzam and Sorgea, however, were then terminated between April and June 2020. (SAC, ¶ 140.)

Defendants demur on the grounds that Plaintiffs fail to plead actionable scienter and justifiable reliance.

Defendants maintain that Plaintiffs fail to allege that Cole had any knowledge that Armbrust, Lepisi, Garzam and Sorgea were to be terminated at any time before Wong’s hiring. Yet, as alleged, Cole also made statements after Wong’s hiring. Therefore, Defendants’ argument does not dispose of the entire cause of action. Although the post-hiring statements were not made to Lepisi, Defendants did not separately demurrer as to Lepisi, and the demurrer is OVERRULED.

As to justifiable reliance, Defendants insist that Plaintiffs fail to allege a detrimental change of position, and that Plaintiffs could not have justifiably relied on the statements since employment is generally at will unless there is a specified term. (Labor Code §2922 [“An employment, having no specified term, may be terminated at the will of either party on notice to the other. Employment for a specified term means an employment for a period greater than one month.”].) Defendants note that Plaintiffs do not allege a specified term of their employment, therefore, their employment was at will.

The Court finds that Plaintiffs sufficiently allege a detrimental change of position given their allegation that they relied upon the misrepresentations and did not seek alternate employment during 2020. (SAC, ¶ 54.) Further, although Labor Code section 2922 provides that employment is generally at will, whether Plaintiffs justifiably relied on Cole’s statements is a question of fact.

Accordingly, the demurrer is OVERRULED.

Breach of Contract [Navolio v. Capital Christian Center] (COA 6)

Defendants demur to cause of the sixth action because Navolio was not given leave to amend to add this new cause of action.

Plaintiffs again argue that this cause of action is proper because the determination of the validity of the arbitration agreement has not yet occurred, and that Defendants were on notice of Navolio’s claims.

As noted above, in Plaintiffs’ FAC, the breach of contract cause of action was asserted only by Sperbeck, and the Court overruled Defendants’ demurrer to thereto. Thus, Plaintiffs did not have leave amend to add this cause of action.

Accordingly, the Court, in its own discretion, STRIKES this cause of action.

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Where leave to amend is granted, Plaintiffs may file and serve a third amended complaint (“3AC”) by no later than March 11, 2025, Response to be filed and served within 30 days thereafter, 35 days if the 3AC is served by mail. (Although not required by any statute or rule of court, Plaintiff is requested to attach a copy of the instant minute order to the 3AC to facilitate the filing of the pleading.)

This minute order is effective immediately. No formal order or other notice is required. (Code Civ. Proc. §1019.5; CRC Rule 3.1312.)

[1] It should be noted that the Presiding Judge granted leave to amend the complaint on June 1, 2023 but Plaintiffs

inexplicably waited until March 11, 2024 to file the FAC. That delay was certainly not caused by any court event.

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