WILSHIRE LAW FIRM, PLC VS ACCELERATE MARKETING, ET AL.

Tentative Rulings

Case Number: *******0874 Hearing Date: March 17, 2023 Dept: 68

Wilshire Law Firm, P.C., vs. Accelerate Marketing, et al., Case No. *******0874

Demurrer to Cross-Complaint

MOVING PARTY: Cross-Defendant Wilshire Law Firm, P.C.

RESPONDING PARTY: Cross-Complainants Accelerate Marketing and Ryan Steinolfson

I. BACKGROUND

A. Factual

Defendants/Cross-Complainants were hired to provide marketing services to Plaintiff/Cross-Defendant.

In the Third Amended Complaint Plaintiff alleges that Defendants/Cross-Complainants failed to provide the contracted services and breached the parties’ agreement by failing to provide Plaintiff with access to some of its digital accounts. In response, Defendants/Cross-Complainants filed a cross-complaint in which they allege two causes of action. The first is for breach of contract and the second for defamation. Cross-Complainants claim that Plaintiff/Cross-Defendant breached the contract by failing to give 30 days’ notice before cancelling the contract and that Cross-Defendant defamed Cross-Complainants to current and potential clients.

B. Procedural

This action was originally filed by Plaintiff on June 6, 2022. On December 14, 2022, Defendants/Cross-Complainants filed their answer and cross-complaint. Cross-Defendant filed its Demurrer to the Cross-Complaint on February 16, 2023.

No opposition has been filed as of March 16, 2023.

[The Court notes that Defendants/Cross-Complainants filed a single pleading containing both their Answer and the Cross-Complaint. This is not in compliance with California Code of Civil Procedure 428.40 which provides: “The cross-complaint shall be a separate document.”]

II. ANALYSIS

A. The Demurrer

As a general matter, in a demurrer proceeding, the defects must be apparent on the face of the pleading or via proper judicial notice. (Donabedian v. Mercury Ins. Co. (2004) 116 Cal.App.4th 968, 994.) “A demurrer tests the pleading alone, and not the evidence or facts alleged.” (E-Fab, Inc. v. Accountants, Inc. Servs. (2007) 153 Cal.App.4th 1308, 1315.) As such, the court assumes the truth of the complaint’s properly pleaded or implied factual allegations. (Id.) The only issue a demurrer is concerned with is whether the complaint, as it stands, states a cause of action. (Hahn v. Mirda (2007) 147 Cal.App.4th 740, 747.)

Where a demurrer is sustained, leave to amend must be allowed where there is a reasonable possibility of successful amendment. (Goodman v. Kennedy (1976) 18 Cal.3d 335, 348.) The burden is on the plaintiff to show the court that a pleading can be amended successfully. (Id.; Lewis v. YouTube, LLC (2015) 244 Cal.App.4th 118, 226.) However, “[i]f there is any reasonable possibility that the plaintiff can state a good cause of action, it is error to sustain a demurrer without leave to amend.” (Youngman v. Nevada Irrigation Dist. (1969) 70 Cal.2d 240, 245).

1. First Cause of Action for Breach of Contract

Cross-Defendant argues that Cross-Complainants have failed to state a claim for breach of contract. All that Cross/Complainants have alleged is that Plaintiff/Cross Defendant failed to give the required 30-day notice to cancel the contract. They have alleged nothing further regarding that claim.

The elements of a cause of action for breach of contract are: “‘(1) the contract, (2) plaintiff's performance or excuse for nonperformance, (3) defendant's breach, and (4) the resulting damages to plaintiff.’” (Hamilton v. Greenwich Investors XXVI, LLC (2011) 195 Cal.App.4th 1602, 1614.)

To plead a cause of action for breach of contract, a plaintiff must plead the terms of the contract, her performance of the contract or excuse for nonperformance, defendant's breach and the resulting damage. (Orworth v. Southern Pacific. Transp. Co. (1985) 166 Cal.App.3d 452, 458.) If the action is based on an alleged breach of a written contract, the terms must be set out verbatim in the body of the complaint or a copy of the written instrument must be attached and incorporated by reference. (Id.)

A breach of contract is not actionable without damage. (Bramalea California, Inc. v. Reliable Interiors, Inc. (2004) 119 Cal.App.4th 468, 473.) To be actionable, harm must constitute something more than nominal damages, speculative harm, or the threat of future harm not yet realized. (Buttram v. Owens–Corning Fiberglas Corp. (1997) 16 Cal.4th 520, 531, n. 4.)

Cross-Complainants claim that they were damaged by Cross-Defendant’s breach, but they fail to articulate how the failure to give 30 days’ notice of cancelation caused any damage. Cross-Defendants also did not set out the terms of the contract verbatim nor provide a copy of the contract and incorporate it by reference. Without these two things, Cross-Complainants cannot maintain a cause of action for breach of contract.

Accordingly, Cross-Defendant’s Demurrer as to Cross-Complainants’ First Cause of Action for breach of contract is SUSTAINED with 20 days leave to amend.

2. Second Cause of Action for Defamation

Cross-Defendant argues that Cross-Complainants’ cross-complaint fails to state a cause of action for defamation.

To allege a claim for defamation, the plaintiff must provide the specific statement, the date it was published, the identity of the speaker, and to whom the statement was published. (See Kahn v. Bowers (1991) 232 Cal.App.3d 1599, 1612, n. 5; Lipman v. Brisbane Elementary Sch. Dist. (1961) 55 Cal.2d 224, 235.)

While Cross-Complainants allege that Cross-Defendant made defamatory statements about them, they fail to give the required specific details about the defamatory statement. Cross-Complainants do not give the date of publication of the statements or the identity of the speaker. Without this information, Cross-Complainants have not stated a cause of action for defamation.

Accordingly, Cross-Defendant’s Demurrer as to the Second Cause of Action is sustained with 20 days leave to amend.

ORDER

1. Cross-Defendant’s Demurrer as to Cross-Complainants’ First and Second Causes of Action is sustained with 20 days leave to amend.

2. Any new amended Cross Complaint shall not also contain the Answer or Defendants.