Celebrity Chefs Tour, LLC v. Macy's, Inc.

16 F.Supp.3d 1141

CELEBRITY CHEFS TOUR, LLC, a California limited liability company; and Promark Productions, LLC, a California limited liability company, Plaintiffs,

v.MACY'S, INC, a Delaware corporation; Whirlpool Corporation, a Delaware corporation; LEC Media, LLC, an Illinois limited liability company; Executive Program Services, Inc., a Washington corporation; Jack O'Donnell, an individual; Scott Dummler, an individual; Devin Alexander, Inc., a California corporation; Devin Alexander, a.k.a. Renee Simone, an individual; and Does 1–10, inclusive, Defendants.

Case No. 13–CV–2714 JLS (KSC).

United States District Court, S.D. California.

Signed April 25, 2014

Motion granted in part and denied in part. Richard Michael Wirtz, Wirtz Law APC, Thomas Daniel Foster, TD Foster, San Diego, CA, for Plaintiffs.

Cynthia Tsai Brady, Macy's Inc., St. Louis, MO, Christine M. LaPinta, Trevor Brian Potter, Seltzer Caplan McMahon Vitek, San Diego, CA, for Defendants.

ORDER: (1) GRANTING DEFENDANT MACY'S, INC.'S REQUEST FOR JUDICIAL NOTICE; AND (2) GRANTING IN PART AND DENYING IN PART DEFENDANT MACY'S, INC.'S MOTION TO DISMISS PLAINTIFFS' COMPLAINT PURSUANT TO FEDERAL RULE OF CIVIL PROCEDURE 12(b)(6) (ECF No. 19)

JANIS L. SAMMARTINO, District Judge.

Presently before the Court is Defendant Macy's, Inc.'s (“Macy's”) Motion to Dismiss (“MTD”) Plaintiffs Celebrity Chefs Tour, LLC (“CCT”) and Promark Productions, LLC's (“Promark,” and, collectively, “Plaintiffs”) Complaint Pursuant to Federal Rule of Civil Procedure 12(b)(6). (ECF No. 19.) Also before the Court are Macy's Request for Judicial Notice (“RJN”) (ECF No. 19–2), Plaintiffs' RJN (ECF No. 36),¹ and Plaintiffs' Response in Opposition to (ECF No. 39) and Macy's Reply in Support of (ECF No. 42) the Motion. The hearing for the Motion was vacated and the matter taken under submission without oral argument pursuant to Civil Local Rule 7.1.d.1. (ECF No. 54.) Having considered the parties' arguments and the law, the Court GRANTS Macy's RJN and GRANTS IN PART AND DENIES IN PART Macy's MTD.

3. The parties address these claims in a haphazard order in their briefs, but the Court will address the claims in the order in which they appear in the Complaint.

A. Claim 1: Breach of Contract

Macy's first argues that Promark ⁴ fails to allege all of the elements required for a breach-of-contract claim. “Under California law, the elements required to establish actionable breach of contract are the existence and terms of the contract, plaintiff's performance, defendant's breach, and damages therefrom.” Student Loan Mktg. Ass'n v. Hanes, 181 F.R.D. 629, 633 (S.D.Cal.1998) (citing M.G. Chamberlain & Co. v. Simpson, 173 Cal.App.2d 263, 343 P.2d 438 (1959)).

In its MTD, Macy's concedes that Promark alleges the existence of a contract. (MTD 12, ECF No. 19–1 (“Promark alleges it entered into a contract with Macy's.”).) In its Reply, however, Macy's argues that the Declaration of Gary Ravet (“the Ravet Declaration”), which the Court has judicially noticed, establishes that Promark was not a party to any contract with Macy's. (Reply 6, ECF No. 42; see Order 8–9, ECF No. 78.) The Court finds it somewhat puzzling that Macy's makes this argument in light of its contention, also found in its Reply, that the Court may not actually consider in deciding this MTD the “lengthy recitation of questionable remembrances with no foundation” that is the Ravet Declaration. (Reply 3, ECF No. 42.) As the Court has already acknowledged, it can notice the existence of the Ravet Declaration, but not the disputed facts contained therein. ( See supra p. 1147.) See also Rezentes v. Sears, Roebuck & Co., 729 F.Supp.2d 1197, 1206 (D.Haw.2010) (explaining that a court may only take judicial notice of the existence of a prior declaration). Accordingly, the Court disregards Macy's spurious argument—which seemingly questions the merits of Promark's claim rather than the sufficiency of the allegations, anyway—and determines that Promark sufficiently alleges the existence of a contract. ( See, e.g., Compl. ¶¶ 29–37, 43–45, 66, ECF No. 1.) Whether discovery will reveal that said contract was legitimate is, of course, a question for another day.

The Court also finds that Promark alleges performance. ( Id. ¶ 91.) However, Macy's argues that the Complaint states that Alexander breached the Alexander Contract, rather than that Macy's breached the Purchase Order. (MTD 12, ECF No. 19–1.) Promark counters that this is a typographical error, and that it nonetheless alleges breach by stating that Macy's refused to send the third sponsorship payment and that Plaintiffs sent Macy's written notice of Macy's breach of the Purchase Order. (Pls.' Resp. in Opp'n 8, ECF No. 39 (citing Compl. ¶¶ 58, 71, ECF No. 1).) The Court agrees with Promark that its factual allegations are sufficient to allege breach. Further, the Court notes that, despite the typographical error, the Complaint nonetheless specifically alleges that “[a]s a direct, proximate, and legal result of the breaches by Macy's and Does 1 through 100, inclusive, Plaintiffs have been damaged.” (Compl. ¶ 93, ECF No. 1 (emphasis added).) Accordingly, Promark has alleged each of the elements of a claim for breach of contract, and therefore the Court DENIES Macy's MTD for this claim as to Promark.

B. Claim 4: Intentional Misrepresentation

The elements of a claim for intentional misrepresentation are: “(1) a misrepresentation (false representation, concealment, or nondisclosure); (2) knowledge of falsity (or scienter); (3) intent to defraud, i.e., to induce reliance; (4) justifiable reliance; and (5) resulting damage.” Robinson Helicopter Co. v. Dana Corp., 34 Cal.4th 979, 22 Cal.Rptr.3d 352, 102 P.3d 268, 274 (2004) (citing Lazar v. Superior Court, 12 Cal.4th 631, 638, 49 Cal.Rptr.2d 377, 909 P.2d 981 (1996)).

Because a claim for misrepresentation sounds in fraud, the heightened pleading standards of Federal Rule of Civil Procedure 9(b) apply. For misrepresentation claims, this standard is met when a party specifies the time, place and specific content of the alleged fraudulent representation; the identity of the person engaged in the fraud; and “ ‘the circumstances indicating falseness' ” or “ ‘the manner in which [the] representations were false and misleading.’ ” Genna v. Digital Link Corp., 25 F.Supp.2d 1032, 1038 (N.D.Cal.1997) (quoting In re GlenFed, Inc. Sec. Litig., 42 F.3d 1541, 1547–48 (9th Cir.1994)). However, “[m]alice, intent, knowledge, and other conditions of a person's mind may be alleged generally.” Fed.R.Civ.P. 9(b). But, where multiple defendants are accused of fraud, the claim “must inform each defendant of his alleged participation in the fraud.” Ricon v. Recontrust Co., No. 09cv937–IEG–JMA, 2009 WL 2407396, at *3 (S.D.Cal. Aug. 4, 2009) (quoting Di Vittorio v. Equidyne Extractive Indus., 822 F.2d 1242, 1247 (2d Cir.1987)). Moreover, merely attributing a misrepresentation to a corporate entity is inadequate; a specific person must be ... identified. See Kriendler v. Chem. Waste Mgmt., Inc., 877 F.Supp. 1140, 1155 (N.D.Ill.1995).

Macy's argues that Plaintiffs' claim for intentional misrepresentation fails because Plaintiffs do not allege with the requisite level of specificity: (1) the purported false representations, (2) intent to induce reliance or actual reliance, and (3) damage. (MTD 16–19, 20, ECF No. 19–1.) Plaintiffs counter that the Complaint adequately pleads Macy's fraud. The Court agrees with Plaintiffs. First, Plaintiffs allege that, inter alia, the following statements by Macy's agents constitute false representations: that the sponsorship had been approved (Compl. ¶¶ 29–32, ECF No. 1), that sponsorship payments were being processed and/or were ready to be sent ( id. ¶¶ 36, 38, 41), that Macy's “hoped to make this a multi-year arrangement” ( id. ¶ 37), that Macy's created the “Macy's GACT” logo for its in-store promotions ( id. ¶ 53), that Rosenthal would stay at Macy's until the Tour was finished ( id. ¶ 54), that Macy's would make the second sponsorship payment ( id. ¶ 59), that Macy's would sign the Purchase Order ( id. ¶ 65), and that Macy's would make the third sponsorship payment ( id. ¶ 73). (Pls.' Resp. in Opp'n 11, ECF No. 39.) These factual allegations are detailed and specify who said them, the date on which they were said, and whether they were said via telephone or in person (and, if in person, where).

Second, Plaintiffs allege that Macy's knew these representations were false. (Pls.' Resp. in Opp'n 11–12, ECF No. 39 (citing, inter alia, Compl. ¶¶ 105, 113, ECF No. 1).) Third, Plaintiffs allege Macy's intent to defraud or induce reliance. ( Id. at 12 (citing, inter alia, Compl. ¶¶ 106, 113, ECF No. 1).) Contrary to Macy's arguments, knowledge and intent may be pled generally. See Fed.R.Civ.P. 9(b).

Fourth, Plaintiffs allege justifiable reliance by stating, inter alia, that: Macy's requested that Plaintiffs send it the Purchase Order and various invoices (Compl. ¶¶ 34–35, ECF No. 1), Macy's assured Plaintiffs that it would make its sponsorship payments ( id. ¶¶ 36, 41, 59, 73), and Macy's told Plaintiffs that it would sign the Purchase Order ( id. ¶¶ 38, 73). (Pls.' Resp. in Opp'n 12, ECF No. 39.) Given these allegations, Plaintiffs' reliance seems objectively justifiable. Finally, Plaintiffs allege resulting damage. ( Id. (citing Compl. ¶¶ 75, 109, 115, ECF No. 1).) Macy's appears to have caused Plaintiffs' harm, as Macy's failure to make its sponsorship payments forced Plaintiffs to suspend the Tour and the editing of the footage prior to completion. As a whole, the Complaint satisfactorily gives Macy's notice of its purported fraud and makes out a prima facie claim for intentional misrepresentation. Accordingly, the Court finds that these allegations are sufficient to survive Macy's MTD and DENIES Macy's MTD as to this claim.

C. Claim 5: Negligent Misrepresentation

To allege a claim for negligent misrepresentation, a...