WILLIAM LYNG v. THE BOEING COMPANY, et al.

On the same day, Jon Randell (a Boeing executive) contacts Plaintiff and informs him that Boeing had purchased all of Alatus's debt. Mr. Randell explains that Boeing now controls Alatus's operations and executive functions. Mr. Randell also explains that Boeing had appointed Riveron to assume day-to-day control over Alatus on Boeing's behalf. Additionally, Mr. Randell tells Plaintiff that Boeing intends to place Plaintiff on administrative leave. Mr. Zappone, acting as an agent for Riveron, was also on the call. Mr. Zappone and Mr. Lee gave the directive to suspend Plaintiff as CFO and to replace him with Kurt Hedderich as the acting CFO.

12/15/2021: Mr. Hedderich requests that Plaintiff return his Alatus equipment, including his phone and computer.

12/31/2021: Plaintiff receives his regular biweekly paycheck in the amount of $10,234.94. However, when Plaintiff attempts to deposit the check, the bank returns the check for insufficient funds. Thus, Plaintiff receives no wages while he is on administrative leave (through January 2022).

1/26/2022: Mr. Zappone (acting as CRO of Alatus, employee of Riveron, and at the direction of Boeing) terminates Plaintiff, citing "willful failure to follow directives" and "failure to perform duties," even though Plaintiff had been prevented from performing his duties when he was cut off from access to company information and equipment.

May 2022: Plaintiff initiates arbitration against Alatus with the American Arbitration Association ("AAA") pursuant to the parties' Arbitration Agreement. The matter is assigned to Arbitrator Eric Epstein, Esq. (the "Arbitrator"). Alatus pays all fees associated with arbitration and participates in the arbitration proceedings for nearly three years.

February 2025: The Arbitrator grants Plaintiff's motion to amend the arbitration complaint to add Boeing and Riveron as Respondents. Notably, both Boeing and Riveron had opposed the motion on the grounds that they were not signatories to the Arbitration Agreement.

April 2025: Alatus informs the Arbitrator that as a result of an executed General Assignment for the Benefit of Creditors, Alatus would no longer participate in the arbitration. On 8/7/2025, AAA provided Defendant(s) with an invoice for arbitration fees, which Defendant(s) fail to pay within 30 days. Thereafter, the arbitration is dismissed.

12/12/2025: Plaintiff files the Complaint. Plaintiff files the First Amended Complaint ("FAC") on 3/30/2026. [1] The operative Second Amended Complaint ("SAC"), filed 6/22/2026, alleges causes of action for: 1. Breach of Written Contract (EEA) 2. Failure to Pay Contractual Wages 3. Failure to Pay Wages Due at Time of Discharge 4. Failure to Provide Accurate Wage Statements 5. Unlawful Business Practice in Violation of Business and Professions Code section 17200 6. Breach of Written Contract (Arbitration Agreement)

7/22/2026: Boeing files this demurrer to the SAC, which is followed by Plaintiff's Opposition (8/4/2026) and Boeing's Reply (8/10/2026).

TENTATIVE RULING: DEMURRER TO THE SECOND AMENDED COMPLAINT OF DEFENDANT THE BOEING COMPANY is OVERRULED.

I. DEMURRER

Boeing demurs to all six causes of action alleged in the SAC pursuant to Code of Civil Procedure section 430.10, subdivisions (e) and (f).

A. 1 st Cause of Action: Breach of the EEA -- OVERRULED

Plaintiff's claim against Boeing for breach of the EEA is sufficiently alleged. Like in Boeing's prior demurrer, Boeing once again argues that Plaintiff fails to adequately allege the existence of a contract between Plaintiff and Boeing. (Mot., at p. 8.) However, the Court finds that the updated allegations in the SAC have cured this defect in the prior pleading. In the SAC, Plaintiff alleges that he entered into the EEA with Alatus on March 18, 2021 when he was hired as Alatus's CFO and that the EEA was later amended in September 2021. (SAC, P.P. 22-23, 81, Exh.

A.) Plaintiff negotiated the amended EEA with Alatus director, Mr. Lee, and Alatus CEO, Mr. Holland, as well as outside counsel. (Id. P. 25.) Plaintiff further alleges that the parties intended "any company that acquire[d] Alatus [to be] bound by the terms of the new agreement." (Ibid.) Like in the FAC, there are no allegations to suggest that Boeing was involved in the negotiations or formation of the EEA between Plaintiff and Alatus in any way.

Although Plaintiff effectively concedes that Boeing was not a direct contracting party to the EEA, Plaintiff argues that Boeing is bound to the EEA as an affiliate under the express terms of the EEA, as a joint employer who exercised ultimate control over Plaintiff's employment, as an alter ego and single enterprise with Alatus, and as a successor in interest through its agent Riveron. (Opp., at p. 1.)

First, Plaintiff argues that Boeing is liable for Alatus's obligations under the EEA as an "Affiliate" of Alatus. (Opp., at p. 6.) Section 1.1 of the EEA defines "Affiliate" as "any Person directly or indirectly controlling or controlled by or under the direct or indirect common control with such Person. For purposes of this definition, 'control' when used with respect to any Person means the power to direct the management and policies of such Person, directly or indirectly, whether through the ownership of voting securities, by contract, or otherwise." (SAC, Exh.

A, Sec. 1.1.) Here, Plaintiff alleges that Boeing "instructed Riveron to take over the management functions and authority of Alatus employees, to terminate Plaintiff Lyng, and to assume executive CFO authority over Alatus." (Id. P. 55.) Plaintiff further alleges that Boeing dictated the operations of Alatus, in part through Riveron's employees' management of Alatus, for the exclusive benefit of Boeing. (Id. P. 64.) Additionally, Plaintiff alleges that Boeing, through its subsidiary CC Aerospace Financing, LLC, exercised "substantial control" over Alatus's "operations, finances, and personnel decisions" and that Boeing installed Mr.

Lee as the sole director of Alatus and approved the appointment of Mr. Zappone as Alatus's CRO. (Id. P. 4.) Plaintiff further alleges that a Boeing executive admitted to Plaintiff that Boeing: (1) controlled Alatus's operations and executive functions, (2) appointed its subsidiary, Riveron, to assume day-to-day executive control of Alatus on Boeing's behalf, and (3) made the decision to place Plaintiff on administrative leave and to replace the Alatus CFO. (Id. P.P. 29-33.) Assuming the truth of Plaintiff's allegations that Boeing indirectly controlled the corporate management, personnel decisions, and finances of Alatus, the Court finds that Plaintiff has alleged sufficient facts to show that Boeing falls within the definition of an Alatus "Affiliate" under the EEA.

Next, Section 12 of the EEA provides that the agreement "shall be binding upon and benefit the parties hereto, and their respective heirs, successors or assigns" and that the term "Company" in the EEA "shall be deemed to include the successors and assigns of the original or any subsequent entity constituting the Company as well as any and all divisions, subsidiaries, or affiliates thereof." (SAC, Exh. A, Sec. 12, italics added.) Construing this provision most favorably for Plaintiff as applying to all "affiliates" of Alatus, the Court finds that the parties intended for Boeing, as a controlling "affiliate" of Alatus, to fall within the definition of the "Company" in the EEA.

Second, Plaintiff argues that Boeing can be held liable for Alatus's contractual obligations under a "joint employer" theory. (Opp., at p. 7.) "'Joint employment occurs when two or more persons engage the services of an employee in an enterprise in which the employee is subject to the control of both.'" (Mattei v. Corporate Management Solutions, Inc. (2020) 52 Cal.App.5th 116, 123 (Mattei).) To be considered a joint employer, a defendant must exercise control over the wages, hours, or working conditions of an employee. (Martinez v.

Combs (2010) 49 Cal.4th 35, 76; Mattei, supra, 52 Cal.App.5th at p. 123, citing Duffey v. Tender Heart Home Care Agency, LLC (2019) 31 Cal.App.5th 232, 254.) However, "a person can be a joint employer [even] without exercising direct control over the employee." (Medina v. Equilon Enterprises, LLC (2021) 68 Cal.App.5th 868, 879 (Medina).) That is, "[i]f the putative joint employer instead exercises enough control over the intermediary entity to indirectly dictate the wages, hours, or working conditions of the employee, that is a sufficient showing of joint employment." (Ibid.)

Here, as described above, Plaintiff alleges that Boeing exercised extensive control over Plaintiff's employment. For example, Plaintiff alleges that Boeing exercised its proxy rights to elect a new Alatus director (Mr. Lee) and CRO (Mr. Zappone), acted through its subsidiary (Riveron) to assume day-to-day executive control over Alatus, instructed Mr. Lee and Mr. Zappone (who was also a Riveron employee) to remove Plaintiff as the CFO of Alatus and to place him on administrative leave, and ultimately to replace Plaintiff with Mr.

Hedderich, a Riveron employee. (SAC, P.P. 28-37.) These amended allegations suggest that Boeing effectively held 100% control over the proxy vote, restructured the executives of Alatus to individuals who were employed by intermediaries controlled by Boeing, and permitted the remaining Alatus entity to be drained of its funds after restructuring (as demonstrated by the lack of Alatus funds available to pay Plaintiff's paycheck). Plaintiff also alleges that Boeing and Riveron together with Alatus made the decision to place Plaintiff on leave, that Boeing directed Mr.

Zappone to place Plaintiff on leave, and that Mr. Zappone was acting at the direction of Boeing when he terminated Plaintiff's employment. (Id. P.P. 30-41.) Together, these allegations are sufficient to suggest that Boeing had significant control over the day-to-day operations of Plaintiff's employment during the time period relevant to this lawsuit. The Court must accept as true Plaintiff's allegations that Boeing executives gave the directives regarding Plaintiff's working conditions, his administrative leave, and his termination.

Further, under Medina, Boeing's direct control over the intermediary entity (here, Riveron) which was exercising control over Plaintiff's employment and working conditions is sufficient at the pleading stage to show a joint employment relationship between Boeing and Alatus. (Medina, supra, 68 Cal.App.5th at p. 879.)

Third, Plaintiff seeks to hold Boeing liable as an alter ego of Alatus and Riveron. (SAC, P.P. 4-5, 12; Opp., at p. 9-12.) "In California, two conditions must be met before the alter ego doctrine will be invoked. First, there must be such a unity of interest and ownership between the corporation and its equitable owner that the separate personalities of the corporation and the shareholder do not in reality exist. Second, there must be an inequitable result if the acts in question are treated as those of the corporation alone." (Sonora Diamond Corp. v.

Superior Court (2000) 83 Cal.App.4th 523, 538 (Sonora Diamond).) When evaluating alter ego liability, courts may consider various factors including the commingling of funds and other assets, identical equitable ownership or identical directors and officers, the "use of one as a mere shell or conduit for the affairs of the other," inadequate capitalization, disregard of corporate formalities, and lack of segregation of corporate records. (Id. at pp. 538-539.)

Here, the SAC includes sufficient facts to plead each element of the Sonora Diamond test for alter ego liability. First, Plaintiff alleges that a unity of interest between the Defendants has ceased to exist because the Defendants have transferred assets of the others for their own benefit without adequate consideration, and the Defendants have exercised complete dominance and control over the others such that the entities are "mere shells and instrumentalities" of the others. (SAC, P. 12.) For example, Plaintiff alleges that Boeing contributed upwards of $50 million to Alatus's operations, focused Alatus's manufacturing efforts to build parts specifically for Boeing (to the detriment of Alatus's other customers and Alatus's bottom-line), removed Plaintiff from his position as an Alatus officer, dictated Alatus's operations for the exclusive benefit of Boeing, held a controlling proxy vote over Alatus, and left Alatus insolvent. (Id., P.P. 28, 61-66.)

These allegations suggest a commingling of funds, near-identical ownership and control, inadequate capitalization, and Boeing's use of Alatus as a mere "shell" for the affairs and interests of Boeing to the detriment of Alatus. Second, Plaintiff alleges that treating Defendants as separate entities would promote a fraud or injustice because Boeing was the entity that acted to remove Plaintiff and used Alatus for Boeing's sole benefit while decapitalizing Alatus, thus leaving Plaintiff unable to recover any judgment from Alatus. (Id., P.P. 66-67.)

These allegations of ultimate fact are sufficient to support a theory of alter-ego liability against Defendants at the pleading stage.

Considered together, whether Boeing was an affiliate, joint employer, or alter ego of Alatus, the substantial allegations of Boeing's direct and indirect control over Alatus's operations in the final few months of Plaintiff's employment are sufficient to infer that Boeing was acting as Plaintiff's putative employer at the time the EEA was breached. Minimally, Plaintiff's alter ego/single enterprise allegations are sufficient to impute Alatus's contractual obligations under the EEA onto Boeing, even if Boeing was not a direct contracting party. Therefore, the Court finds that Plaintiff's first cause of action against Boeing is sufficiently pled.

B. 2 nd, 3 rd, and 4 th Causes of Action: Failure to Pay Contractual Wages, Failure to Pay Wages Due at Time of Discharge, and Failure to Provide Accurate Wage Statements -- OVERRULED

Plaintiff's Labor Code claims against Boeing are sufficiently pled. Boeing argues that even if Plaintiff has adequately alleged that Boeing and Alatus were acting as Plaintiff's joint employers, Boeing cannot be held vicariously liable for Alatus's wage violations based on its joint employer status alone. (Mot., at p. 18.) Not only does the Court finds that the SAC adequately alleges that Boeing and Alatus were acting as joint employers (thereby imposing an independent duty upon Boeing to pay wages) but Plaintiff's alter ego/single enterprise allegations are also sufficient to impute any liability for Alatus's wage and hour violations to Boeing as well. (See Futrell v.

Payday California, Inc. (2010) 190 Cal.App.4th 1419, 1423 ["'no generally applicable rule of law imposes on anyone other than an employer a duty to pay wages.'"].) Thus, for the same reasons that the Court finds Boeing can be held liable to Plaintiff for breach of the EEA, Plaintiff has also stated his wage-and-hour claims against Boeing.

C. 5 th Cause of Action: Unlawful Business Practice in Violation of Business and Professions Code section 17200 -- OVERRULED

Plaintiff's claim against Boeing for violation of the UCL is sufficiently pled. "In prohibiting 'unlawful' business acts or practices, the UCL 'borrows' rules set out in other laws and makes violations of those rules independently actionable." (People ex rel. Elliott v. Kaiser Foundation Health Plan, Inc. (2024) 105 Cal.App.5th 1114, 1126, internal quotations omitted.) "[V]irtually any law or regulation--federal or state, statutory or common law--can serve as [a] predicate for a [Business and Professions Code section] 17200 'unlawful' violation." (Paulus v. Bob Lynch Ford, Inc. (2006) 139 Cal.App.4th 659, 681.)

Here, Boeing argues that Plaintiff's UCL claim fails because it is wholly derivative of Plaintiff's contract and wage-and-hour claims. (Mot., at p. 19.) Plaintiff's UCL claim is specifically based upon Boeing's alleged violations of Labor Code sections 201, 203, 210, 226, and 2802. (SAC, P. 115.) Plaintiff has also alleged independent claims for violations of Labor Code sections 201, 203, 210, and 226 within his second, third, and fourth causes of action. (Id. P.P. 37, 92, 97-98, 106-107.) Because Plaintiff's second through fourth causes of action are sufficiently pled, these alleged statutory violations are also adequate to state a claim for Boeing's liability under the "unlawful" prong of the UCL.

Boeing also argues that Plaintiff has failed to allege sufficient facts to show a violation of Labor Code section 2802, which does not expressly fall within the scope of any of Plaintiff's independent statutory claims. (Mot., at p. 19.) "'Ordinarily, a general demurrer does not lie as to a portion of a cause of action and if any part of a cause of action is properly pleaded, the demurrer will be overruled.'" (Elder v. Pacific Bell Telephone Co. (2012) 205 Cal.App.4th 841, 856, fn. 14.) Thus, where the Court determines that a UCL cause of action has been stated based on an unlawful business practice for violations of other sections of the Labor Code, the Court need not address a defendant's other challenges to the UCL cause of action. (Ibid.)

In this case, because Plaintiff has stated a claim for violation of the UCL that is derivative of his three Labor Code causes of action, the Court need not address Boeing's additional challenge to Plaintiff's pleading under Labor Code section 2802. (Munoz v. Patel (2022) 81 Cal.App.5th 761, 780 [confirming the principle that if any portion of a cause of action is properly pleaded, the demurrer will be overruled]; Blakemore v. Superior Court (2005) 129 Cal.App.4th 36, 49 [same].)

D. 6 th Cause of Action: Breach of the Arbitration Agreement -- OVERRULED

Finally, the Court finds that Plaintiff's sixth cause of action against Boeing is sufficiently pled. Like in its prior demurrer, Boeing argues that Plaintiff fails to allege any actionable breach of the Arbitration Agreement by Boeing because Plaintiff does not identify how Boeing is bound to Alatus's contract, what contractual duty was owed by Boeing under the Arbitration Agreement, or how Boeing breached said duty. (Mot., at p. 19.) Plaintiff responds that the Arbitration Agreement is enforceable against Boeing for the same reasons identified above with respect to the EEA. (Opp., at p. 13.)

Like the EEA, the Arbitration Agreement was originally executed between Plaintiff and Alatus, seemingly before Boeing took control of Alatus and became Plaintiff's joint employer. (SAC, P.P. 69, 119-120, Exh. B.) Unlike the EEA, it does not appear that the Arbitration Agreement specifically includes Alatus's affiliates (like Boeing) within the definition of the "Company" who is a party to the agreement. (Id., Exh. B, Sec. 7.5.) Regardless, the Court finds that Plaintiff has sufficiently demonstrated that Boeing can be held liable for Alatus's breach of the Arbitration Agreement based on the alleged alter ego relationship between Alatus and Boeing.

Based on the aforementioned analysis, Boeing's entire demurrer to the FAC is OVERRULED.

II. REQUEST FOR JUDICIAL NOTICE

Plaintiff requests judicial notice of the (1) Complaint for Damages (dated 12/29/2025), (2) Boeing's Demurrer to the Complaint (dated 3/2/2026), and (3) the Court's order overruling Boeing's demurrer (dated 5/20/2026), filed in the matter of Scott Holland v. Alatus Aerosystems, et al. (Case No. 25STCV38071). (RJN, Exhs. 1-3.) The Court takes judicial notice of the existence of these court filings pursuant to Evidence Code section 452, subdivision (d), but not the truth of the factual matters asserted therein.

Defendant The Boeing Company to serve notice of ruling. This tentative ruling ("TR") shall be the order of the Court unless changed at the hearing and shall by this reference be incorporated into the Minute Order. TR emailed to counsel and posted to court's website on 8/14/26 at 11:30 a.m.

[1] On 5/29/2026, the Court sustains the demurrers to the FAC of Boeing and Riveron, with leave to amend.

Case Number: 26STCP02483 Hearing Date: August 17, 2026 Dept: 307 # 15 TENTATIVE RULING 9:00 a.m., Monday, August 17, 2026 VIVEK SHAH v. STARTENGINE CROWDFUNDING, INC., et al. [26STCP02483] PETITIONER VIVEK SHAH'S PETITION TO COMPEL ARBITRATION

TIMELINE: CIPA dispute arising from use of pen register

1/29/2026: Petitioner Vivek Shah ("Petitioner") accesses the website of Respondent StartEngine Crowdfunding, Inc. DBA StartEngine.com ("Respondent" or the "Website"). (Shah Decl., P. 4.) The Website loads third-party tracking, analytics, advertising, and related technologies during the page-load process. Petitioner alleges he did not receive notice that his browser information would be transmitted to third-party tracking entities. Petitioner also alleges that the Terms of Use for the Website contain an arbitration provision requiring the parties to submit any claim, controversy, or dispute to arbitration pursuant to the rules of the American Arbitration Association ("AAA"). (Id., Exh. 2.)

3/16/2026: Petitioner submits a Consumer Demand for Arbitration to AAA, alleging that Respondent had violated of the California Invasion of Privacy Act ("CIPA") (Penal Code Sec.Sec. 638.50(b), 638.51(a), & 637.2) based on the Website's installation and use of an unauthorized pen register process.

3/28/2026: AAA advises the parties that