SPAANS COOKIE COMPANY, INC. vs ASSOCIATED FAMILY PHYSICIANS, INC., et al.

A Stipulation and Appointment of Official Reporter Pro Tempore (CV/E-206) is required to be signed by each party, the private court reporter, and the Judge prior to the hearing, if not using a reporter from the Court’s Approved Official Reporter Pro Tempore list.

Once the form is signed it must be filed with the clerk. If a litigant has been granted a fee waiver and requests a court reporter, the party must submit a Request for Court Reporter by a Party with

24CV009576: SPAANS COOKIE COMPANY, INC. vs ASSOCIATED FAMILY PHYSICIANS, INC., et al. 06/05/2025 Hearing on Motion to Strike Portions of the First Amended Complaint in Department 53

a Fee Waiver (CV/E-211) and it must be filed with the clerk at least 10 days prior to the hearing or at the time the proceeding is scheduled if less than 10 days away. Once approved, the clerk will be forward the form to the Court Reporter’s Office and an official reporter will be provided.

TENTATIVE RULING

Defendants American Family Physicians, Inc., and Sarah Alarabi, DO’s (“Defendants”) Motion to Strike Portions of Plaintiff Spaans Cookie Company, Inc.’s (“Plaintiff”) Complaint is ruled upon as follows.

Factual Background

This matter arises out of a real estate transaction between Plaintiff and Defendants. In March of 2020, Defendant American Family Physicians, Inc. (“AFP”) leased property commonly known as C Street, Galt, CA 95632 from Plaintiff for a period of five years. In November of 2020, Defendant Sarah Alarabi purchased an ownership interest in AFP.

On or around December 5, 2023, counsel for Defendants informed Plaintiff that the Defendants intended to vacate the subject premises. Defendants vacated on or around December 29, 2023, and ceased paying rent and fees required under the lease agreement.

Plaintiff’s FAC alleges causes of action for breach of contract, civil conspiracy, common counts, and violation of California Business & Professions Code section 17200.

Defendants move to strike the following portions of the FAC:

· All of Paragraph 35 (FAC, 7:1-4) which reads: AFP also breached the implied covenant of good faith and fair dealing in the Lease by, and among other things: (1) ceasing their business operations; (2) vacating the Premises; (3) failing to pay rent and associates fees; and (4) committing various other improper acts and/or omissions to be determined according to proof. · The portion of Paragraph 37 (FAC, 7:10-11): and the implied covenant of good faith and fair dealing. · All of Paragraph 46 (FAC, 9:8-12): Defendants’ actions, as herein alleged, were intentional and constituted malice, oppression, and/or fraud as defined under Civil Code § 3294(c) and were done in conscious disregard of Plaintiff’s rights. Accordingly, Defendants’ actions warrant an assessment of punitive damages in an amount appropriate to punish Defendants and deter others from engaging in similar misconduct.

SUPERIOR COURT OF CALIFORNIA COUNTY OF SACRAMENTO

24CV009576: SPAANS COOKIE COMPANY, INC. vs ASSOCIATED FAMILY PHYSICIANS, INC., et al. 06/05/2025 Hearing on Motion to Strike Portions of the First Amended Complaint in Department 53

· Relief Sought in line 3 of the Second Cause of Action (FAC, 9:17): For exemplary or punitive damages.

Plaintiff opposes.

Legal Standard

“The court may, upon a motion made pursuant to [Code of Civil Procedure] Section 435, or at any time in its discretion, and upon terms it deems proper: (a) Strike out any irrelevant, false, or improper matter inserted in any pleading, (b) Strike out all or any part of any pleading not drawn or filed in conformity with the laws of this state, a court rule, or an order of the court.” (Code Civ. Proc., § 436.) The grounds for a motion to strike must appear on the face of the challenged pleading or from any matter of which the court is required to take judicial notice. (Code Civ.

Proc., § 437, subd. (a).) The use of the motion to strike should be cautious and sparing. It should not be a procedural “line item veto.” (PH II, Inc. v. Superior Court (1995) 33 Cal.App.4th 1680, 1683.) A court tests the adequacy of a claim for punitive damages by way of a motion to strike. (Grieves v. Superior Court (1984) 157 Cal.App.3d 159, 164.)

Under Code of Civil Procedure section 435, a defendant, within the time to respond to a complaint, may file a motion to strike the whole or any part of the pleading. (Code Civ. Proc. § 435, subd. (b)(1).)

Discussion

Allegations of Violation of the Covenant of Good Faith and Fair Dealing

Defendants seek to strike allegations from the FAC pertaining to violation of the covenant of good faith and fair dealing, as these allegations are conclusory and not supported by factual allegations. Defendants cite to Perkins v. Sup. Ct (1981) 117 Cal.App.3d 1, 6, for the proposition that “Conclusory allegations may be stricken where the complaint fails to contain sufficient facts to support such an allegation.” (Mot., p. 3:13-14.) In opposition, Plaintiff argues that the allegations Defendants seek to strike are properly pled and essential to Plaintiff’s claims.

The Court in Perkins explains: In order to plead a cause of action, the complaint must contain a “statement of the facts constituting the cause of action, in ordinary and concise language.” (Code Civ. Proc., § 425.10, subd. (a).) While it is true that pleading conclusions of law does not fulfill this requirement, it has long been recognized that “[t]he distinction between conclusions of law and ultimate facts is not at all clear and involves at most a matter of degree. [Citations.] For example, the courts have permitted allegations which obviously included conclusions of law and have termed them 'ultimate facts' or 'conclusions of fact.”' (Burks

SUPERIOR COURT OF CALIFORNIA COUNTY OF SACRAMENTO

24CV009576: SPAANS COOKIE COMPANY, INC. vs ASSOCIATED FAMILY PHYSICIANS, INC., et al. 06/05/2025 Hearing on Motion to Strike Portions of the First Amended Complaint in Department 53

v. Poppy Construction Co. (1962) 57 Cal.2d 463, 473 [20 Cal.Rptr. 609, 370 P.2d 313].) What is important is that the complaint as a whole contain sufficient facts to apprise the defendant of the basis upon which the plaintiff is seeking relief. (Youngman v. Nevada Irrigation Dist. (1969) 70 Cal.2d 240 [74 Cal.Rptr. 398, 449 P.2d 462]; Semole v. Sansoucie (1972) 28 Cal.App.3d 714 [104 Cal.Rptr. 897].) The stricken language must be read not in isolation, but in the context of the facts alleged in the rest of petitioner's complaint. (Ibid.)

Furthermore, the Court emphasizes the decision set forth in PH II, Inc. v. Superior Court, supra which explains that motions to strike are not to be used as a “line item veto” to excise certain allegations from a pleading: We emphasize that [the] use of the motion to strike should be cautious and sparing. We have no intention of creating a procedural 'line item veto' for the civil defendant. However, properly used and in the appropriate case, a motion to strike may lie for purposes discussed in this opinion. (Id., at p. 1683.)

The Court of Appeal in PH II found that a motion to strike is certainly a proper means by which to challenge punitive damages allegations and that such a motion has also been approved when the face of the complaint fails to plead facts showing a primary right of the plaintiff and a primary duty of, or wrong committed by, the defendant. (Ibid, citing Lodi v. Lodi (1985) 173 Cal.App.3d 628, 631.) But the appellate panel suggested that there are certain other limited circumstances when a motion to strike is permissibly made: We recognize that in some cases a portion of a cause of action will be substantively defective on the face of the complaint.

Although a defendant may not demur to that portion, in such cases, the defendant should not have to suffer discovery and navigate the often dense thicket of proceedings in summary adjudication. We conclude that when a substantive defect is clear from the face of a complaint, such as a violation of the applicable statute of limitations or a purported claim of right which is legally invalid, a defendant may attack that portion of the cause of action by filing a motion to strike. (2 Civil Procedure Before Trial (Cont.Ed.Bar 1994) §31.2, pp.31-3 to 31-4.)

(PH II, Inc., supra, at pp. 1682-1683.)

Here, the Court denies Defendants’ motion to strike portions of paragraphs 35 and 37 of the FAC. First, under Perkins, the allegations are sufficient and supply additional bases for Plaintiff’s breach of contract cause of action. That is, in addition to AFP’s alleged breach of expressed terms of the contract, Plaintiff alleges that AFP has also breached the implied covenant of good faith and fair dealing by taking the alleged actions. (FAC, ¶¶ 34-37.) These

SUPERIOR COURT OF CALIFORNIA COUNTY OF SACRAMENTO

24CV009576: SPAANS COOKIE COMPANY, INC. vs ASSOCIATED FAMILY PHYSICIANS, INC., et al. 06/05/2025 Hearing on Motion to Strike Portions of the First Amended Complaint in Department 53

allegations supply both the term of the contract at issue (the implied covenant) and AFP’s alleged conduct asserted to have breached that term (ceasing their business operations, vacating the Premises, etc.). These allegations, taken as a whole with Plaintiff’s breach of contract claim, are “sufficient facts to apprise the defendant of the basis upon which the plaintiff is seeking relief” and therefore, properly included in the FAC. As such, the allegations are not “irrelevant, false, or improper material” subject to a motion to strike under Code of Civil Procedure section 436.

Second, the Court finds that Defendants’ motion is essentially being used as an improper “line item veto” inasmuch as neither of these two paragraphs appear to constitute any legally invalid claim which might otherwise justify an order striking them from the complaint. On these grounds, the Court denies Defendants’ motion as to the subject portions of these paragraphs.

Punitive Damages

Defendants next seek to strike Plaintiff’s plea for punitive damages and allegations in paragraph 46 which support Plaintiff’s punitive damages plea. Plaintiff opposes, arguing that it alleges specific, factual allegations which are sufficient to support a claim for punitive damages, citing to allegations that Defendant Alarabi structured her acquisition of AFP to evade lease obligations, that Defendants engaged in deceptive communications regarding lease compliance while planning to vacate, and the abrupt abandonment of the premises. (FAC, ¶¶ 11-16, 41.)

Punitive damages are recoverable where the defendant has been guilty of oppression, fraud, or malice, express or implied. (Civ. Code § 3294.) “Something more than the mere commission of a tort is always required for punitive damages. There must be circumstances of aggravation our outrage, such as spite or malice, or a fraudulent or evil motive on the part of the defendant, or such a conscious and deliberate disregard of the interests of others that his conduct may be called willful or wanton.” (Taylor v. Superior Court (1979) 24 Cal.3d 890, 894.) Specific intent to injure is not necessary for a showing of malice-it is sufficient that the defendant's conduct was so “wanton or so reckless as to evince malice or conscious disregard of others' rights.” (McConnell v. Quinn (1925) 71 Cal. App. 671, 682.)

California law is clear that conclusory allegations which simply characterize a defendant's conduct as being willful, intentional, reckless, malicious, oppressive, etc. or which otherwise invoke language from the statutory definitions of these terms are insufficient to plead a valid claim for punitive damages unless specific facts are pleaded to support these allegations. (See, e.g., Brousseau v. Jarrett (1977) 73 Cal.App.3d 864, 872.)

First, the Court grants Defendants’ motion to strike the subject portions of the FAC because the Court has sustained Defendants’ concurrent demurrer to the sole tort cause of action (conspiracy) which Plaintiff has attempted to allege. Thus, there is no tort claim upon which allegations of punitive damages may be maintained. While the Court also sustained Defendants’ demurrer to

SUPERIOR COURT OF CALIFORNIA COUNTY OF SACRAMENTO

24CV009576: SPAANS COOKIE COMPANY, INC. vs ASSOCIATED FAMILY PHYSICIANS, INC., et al. 06/05/2025 Hearing on Motion to Strike Portions of the First Amended Complaint in Department 53

Plaintiff’s cause of action under Business and Professions Code § 17200, it notes that even if such claim had been adequately pled, such claim cannot support a request for punitive damages. On this basis, Defendants’ motion to strike these portions of the FAC is granted.

Second, even if Plaintiff had a remaining tort claim upon which a request for punitive damages could, in theory, be made, the Court is not convinced that Plaintiff’s allegations are sufficient to give rise to a claim for punitive damages. Here, Plaintiff’s plea for punitive damages is supported by conclusory allegations as to Defendants’ intentions with regard to the vacation of the premises and factual allegations essentially that Defendants failed to communicate with Plaintiff regarding closing their business at the subject premises, and then abandoned the premises after providing more than three weeks’ notice. Plaintiff has stated no claim or allegations upon which a claim of punitive damages may be based.

Therefore, Defendants’ motion to strike the following allegations is GRANTED, with leave to amend: · All of Paragraph 46 (FAC, 9:8-12): Defendants’ actions, as herein alleged, were intentional and constituted malice, oppression, and/or fraud as defined under Civil Code § 3294(c) and were done in conscious disregard of Plaintiff’s rights. Accordingly, Defendants’ actions warrant an assessment of punitive damages in an amount appropriate to punish Defendants and deter others from engaging in similar misconduct. · Relief Sought in line 3 of the Second Cause of Action (FAC, 9:17): For exemplary or punitive damages.

Leave to Amend

Plaintiff may file and serve an amended complaint no later than May 19, 2025. Although not required by statute or court rule, Plaintiff is directed to present the clerk a copy of this ruling at the time of filing the Second Amended Complaint. Defendant may file and serve a response within 30 days of service of the Second Amended Complaint, 35 days if served by mail.

The minute order is effective immediately. No formal order pursuant to California Rules of Court, rule 3.1312 or further notice is required.