Nicholas Rodriguez vs TIXR Inc et al

Case Number

24CV04964

Case Type

Hearing Date / Time

Fri, 02/07/2025 - 10:00

Nature of Proceedings

CMC; Demurrer

Tentative Ruling

For the reasons set forth below:

1. The Demurrer of defendant TIXR to plaintiff’s complaint is sustained, as to every cause of action, with leave to amend.

2. Plaintiff shall file and serve any first amended complaint no later than February 21, 2025.           

Background:

This action commenced on September 9, 2024, by the filing of the class action complaint by plaintiff Nicholas Rodriguez, on behalf of himself and all members of the putative class (“plaintiff”) against defendants TIXR, Inc. (“TIXR”) and Lucidity Festival, LLC. (“Lucidity”), setting forth causes of action for: (1) Breach of Contract; (2) Unjust Enrichment; (3) Breach of Implied Covenant of Good Faith and Fair Dealing; (4) Conversion; and (5) Violation of Business and Professions Code section 17200, et seq. (Unfair Competition).

As alleged in the complaint:

Lucidity has organized electronic music festivals since 2012, and TIXR is a provider of online event ticketing services for events organized by Lucidity. (Compl., ¶¶ 11, 12.)

Plaintiff, and the class members purchased event tickets for the 2024 Lucidity Festival through TIXR, which was scheduled to take place from June 28, 2024, through June 30, 2024, with an expected attendance of 4,000 to 5,000 people. (Compl., ¶¶ 14, 15.)

At the beginning of June 2024, Lucidity issued a statement to all ticket purchasers announcing the cancellation of the festival, due to “unforeseen last-minute changes in requirements” imposed by the Santa Barbara County Fire Department. (Compl., ¶ 16.) Lucidity did not issue refunds. (Ibid.)

Lucidity initially rescheduled the festival for April 25, 2025, through April 27, 2025, at a new location in Lake San Antonio North Shore in Monterey. (Compl., ¶ 17.)

“On July 15, 2024, LUCIDITY e-mailed all ticket purchasers for the 2024 Lucidity Festival indicating it was overwhelmed by the number of refund requests and would not be able to process them all. The same e-mail promised an update by August 30, 2024.” (Compl., ¶ 19.)

On August 30, 2024, Lucidity e-mailed all ticket purchasers stating that it would cease operations, cancel all future concerts, and would not provide refunds. (Compl., ¶ 20.)

TIXR now demurs to each cause of action on the grounds that they each fail to state facts sufficient to constitute a cause of action, that they are uncertain, and that there is an error or misjoinder of a party.

Plaintiff opposes the demurrer.

On November 13, 2024, the action was stayed as to Lucidity due to a bankruptcy filing.

Analysis:

              Timeliness of Demurrer

“A person against whom a complaint or cross-complaint has been filed may, within 30 days after service of the complaint or cross-complaint, demur to the complaint or cross-complaint.” (Code Civ. Proc., § 430.40, subd. (a).)

Plaintiff objects to the demurrer as two days late filed. TIXR argues that it was not filed late.

According to the proof of service, which is contained in the court records, TIXR was served, through its agent for service of process, by substituted service on September 13, 2024, and thereafter, on September 16, 2024, mailing copies of the documents. “Service of a summons in this manner is deemed complete on the 10th day after the mailing.” (Code Civ. Proc., § 415.20, subd. (a).) As such, service was deemed complete on September 26, 2024.

Thirty days after September 26, 2024, was October 26, 2024. Because October 26, 2024 falls on a Saturday, the due date for the demurrer was October 28, 2024. The demurrer was filed on October 29, 2024, and is one-day late filed.

The court has discretion to consider an untimely demurrer. (See Jackson v. Doe (2011) 192 Cal.App.4th 742, 749; McAllister v. County of Monterey (2007) 147 Cal.App.4th 253, 280; Code Civ. Proc., § 473, subd. (a)(1).)

Although the demurrer was filed one day later than the deadline, the court will consider it on the merits. Counsel is reminded to be aware of statutory deadlines.

              Demurrer

“The party against whom a complaint or cross-complaint has been filed may object, by demurrer or answer as provided in Section 430.30, to the pleading on any one or more of the following grounds:

            “(a) The court has no jurisdiction of the subject of the cause of action alleged in the pleading.

            “(b) The person who filed the pleading does not have the legal capacity to sue.

            “(c) There is another action pending between the same parties on the same cause of action.

            “(d) There is a defect or misjoinder of parties.

            “(e) The pleading does not state facts sufficient to constitute a cause of action.

            “(f) The pleading is uncertain. As used in this subdivision, “uncertain” includes ambiguous and unintelligible.

            “(g) In an action founded upon a contract, it cannot be ascertained from the pleading whether the contract is written, is oral, or is implied by conduct.

            “(h) No certificate was filed as required by Section 411.35.” (Code Civ. Proc., § 430.10.)

“When any ground for objection to a complaint, cross-complaint, or answer appears on the face thereof, or from any matter of which the court is required to or may take judicial notice, the objection on that ground may be taken by a demurrer to the pleading.” (Code Civ. Proc., § 430.30, subd. (a).) “Our consideration of the facts alleged includes ‘those evidentiary facts found in recitals of exhibits attached to [the] complaint.’ [Citation.]” (Alexander v. Exxon Mobil (2013) 219 Cal.App.4th 1236, 1250.)

“[A] court must treat a demurrer as admitting all material facts properly pleaded, it does not, however, assume the truth of contentions, deductions or conclusions of law.” (Travelers Indem. Co. of Connecticut v. Navigators Specialty Ins. Co. (2021) 70 Cal.App.5th 341, 358, citing Aubry v. Tri-City Hospital Dist. (1992) 2 Cal.4th 962, 967.)

              Objections to Request for Judicial Notice

Concurrently with the filing of the demurrer, TIXR filed a request for judicial notice asking to the court to take judicial notice of: (1) The complaint in this action, and (2) TIXR’s purchase policy as set forth on its website.

Plaintiff objects to the consideration of the purchase policy. Plaintiff’s objection to the purchase policy is well founded. There are no grounds on which to grant judicial notice of the policy. The purchase policy, at most, would go to TIXR’s defenses in this action, but have nothing to do with the sufficiency of the complaint itself. Even if the court were to take judicial notice of the purchase policy, it would not have any effect on the court’s ruling. The objection will be sustained.

Further, concurrently with the filing of the reply to plaintiff’s opposition, TIXR requests that the court take judicial notice of several other documents, including copies of Senate Bills.

“The demurrer tests the pleading alone and not the evidence or other extrinsic matters which do not appear on the face of the pleading or cannot be properly inferred from the factual allegations of the complaint. [Citations.] This principle means that if the pleading sufficiently states a cause of action the demurrer cannot be granted on the basis of a showing of extrinsic matters by inference from attached exhibits, affidavits or otherwise except those matters which are subject to judicial notice. [Citations.]” (Executive Landscape Corp. v. San Vicente Country Villas IV Assn. (1983) 145 Cal.App.3d 496, 499.)

By way of its demurrer, TIXR largely argues the merits of the action and requests that this court improperly consider extrinsic matters, which are not relevant to the sufficiency of the complaint. The court will not treat the demurrer as though it were a motion for judgment on the pleadings or a motion for summary judgment. The court will not take judicial notice of any of the documents.

              First Cause of Action for Breach of Contract

“A contract is an agreement to do or not do a certain thing.” (Civ. Code, § 1549.)

“It is essential to the existence of a contract that there should be:

              “1. Parties capable of contracting;

              “2. Their consent;

              “3. A lawful object; and,

              “4. A sufficient cause or consideration.” (Civ. Code § 1550.)

The essential elements of a cause of action for breach of contract are “(1) the contract; (2) the plaintiff’s performance of the contract or excuse for nonperformance; (3) the defendant’s breach; and (4) the resulting damage to the plaintiff.” (Richman v Hartley (2014) 224 Cal. App. 4th 1182, 1186.)

“A contract is either express or implied.” (Civ. Code, § 1619.) “An implied contract is one, the existence and terms of which are manifested by conduct.” (Civ. Code, § 1621.)

Implied contractual terms ordinarily stand on equal footing with express terms. (See, e.g., Kahsmiri v. Regents of University of California (2007) 156 Cal.App.4th 809, 829.)

Typically, in a breach of contract action, plaintiffs either set out the terms of a contract verbatim, or, more frequently, include a copy of the contract as an exhibit to the complaint. Heritage Pacific Financial, LLC v. Monroy (2013) 215 Cal.App.4th 972 (Heritage), addresses this often-argued issue. Heritage does not require plaintiffs to plead all terms of the contract verbatim or to include a copy of the contact as an exhibit to the complaint. Heritage specifically holds that a contract may be pleaded by its legal effect. “In order to plead a contract by its legal effect, plaintiff must allege the substance of its relevant terms.” (Id., at p. 993, italics added.)

Here, plaintiff has failed to adequately plead the existence of a contract with TIXR, let alone the substance of any alleged contract between plaintiff and TIXR.

Plaintiff’s representations that the complaint alleges that, “Tixr entered into valid contracts for the ticket purchases with the Plaintiff and the putative class, which Tixr material breached by not performing, i.e., providing the promised service,” (Opp., p. 5, ll. 11-13.) is a false statement of what the complaint alleges. The complaint does not, anywhere, allege that TIXR, individually, entered into a contract with plaintiff. What is alleged is: “Defendants were parties to the ticket purchasing agreements with Plaintiff and the class members.” (Compl., ¶ 28; italics added.) “Defendants entered into a valid contract for the ticket purchases with Plaintiff and each class member.” (Compl., ¶ 29; italics added.) “Defendants materially breached the ticket purchasing agreements by, among other things, failing to hold the Lucidity Festival, cancelling the Lucidity Festival, and failing to reimburse or refund all class members.” (Compl., ¶ 31; italics added.)

The allegations contained under the heading of “Breach of Contract,” when read in conjunction with the remainder of the complaint, specifically paragraphs 14 through 20, tend to show that to the extent a contract was created, and breached, it was with Lucidity. As such, plaintiff fails to state sufficient facts to constitute a claim against TIXR.

“If there is a reasonable possibility that a plaintiff can amend his complaint to cure the defects, leave to amend must be granted.” (Galbiso v. Orosi Public Utility Dist. (2010) 182 Cal.App.4th 652, 674.)

The demurrer to the first cause of action for breach of contract will be sustained with leave to amend.

              Unjust Enrichment

“The elements of an unjust enrichment claim are the “ ‘receipt of a benefit and [the] unjust retention of the benefit at the expense of another.’ ” [Citation.]” (Peterson v. Cellco Partnership (2008) 164 Cal.App.4th 1583, 1593.)

Again, contrary to plaintiff’s false claim that the allegations are specific to TIXR (Opp., p.6, ll. 15-18), plaintiff uses the collective “Defendants,” for this cause of action. TIXR and Lucidity are clearly separate entities and engaged in separate actions relative to the actions, or inactions, that are the basis for this action.

The cause of action fails to state facts sufficient to constitute a cause of action against TIXR individually.

The demurrer to the second cause of action for unjust enrichment will be sustained with leave to amend.

              Breach of Implied Covenant of Good Faith and Fair Dealing

“Implied in every contract is a covenant of good faith and fair dealing. The implied covenant prevents one side from unfairly frustrating the other’s right to receive the benefits of the agreement actually made. [Citations.] The covenant does not impose substantive terms beyond those of the contract. [Citation.] A plaintiff claiming breach must allege the defendant’s wrongful conduct was contrary to the contract’s purpose and the parties’ legitimate expectations. [Citation.]” (Cordoba Corp. v. City of Industry (2023) 87 Cal.App.5th 145, 156.)

As the demurrer to the breach of contract cause of action will be sustained with leave to amend, and the breach of implied covenant of good faith and fair dealing cause of action is dependent on the proper pleading of the breach of contract cause of action against TIXR, the demurrer will be sustained with leave to amend.

                        Conversion

“Conversion is generally described as the wrongful exercise of dominion over the personal property of another.  [Citation.] The basic elements of the tort are (1) the plaintiff’s ownership or right to possession of personal property; (2) the defendant’s disposition of the property in a manner that is inconsistent with the plaintiff’s property rights; and (3) resulting damages. [Citation.]” (Fremont Indemnity Co. v. Fremont General Corp. (2007) 148 Cal.App.4th 97, 119.)

As with the other causes of action, plaintiff’s allegations are made in the collective, as to “defendants,” rather than directed at a specific defendant. Also like the other causes of action, the allegations are conclusory and completely lack substance. There are no allegations made that tend to show any of the elements of conversion as to TIXR.

The demurrer to the conversion cause of action will be sustained with leave to amend.

              Unfair Competition (Business & Professions Code, section 17200, et seq.)

“U]nfair competition shall mean and include any unlawful, unfair or fraudulent business act or practice and unfair, deceptive, untrue or misleading advertising and any act prohibited by Chapter 1 (commencing with Section 17500) of Part 3 of Division 7 of the Business and Professions Code.” (Bus. & Prof. Code, § 17200.)

“The UCL defines unfair competition as “ ‘any unlawful, unfair or fraudulent business act or practice....’ ” (§ 17200.) Therefore, under the statute “ ‘there are three varieties of unfair competition: practices which are unlawful, unfair or fraudulent.’ ” [Citation.]” (In re Tobacco II Cases (2009) 46 Cal.4th 298, 311.)

The cause of action is stated as: “Defendants’ activities as alleged herein are violations of California law, and constitute unlawful business acts and practices in violation of California Business & Professions Code sections 17200, et seq.” (Compl., ¶ 54.) The allegation is nothing more than a legal conclusion, which, based on authority stated above, must not be considered. The cause of action is devoid of any allegations against TIXR.

The demurrer to the unfair competition cause of action will be sustained with leave to amend.