Tentative Ruling: Citibank N.A. v. Svetlana L. Dayal
Case Number
25CV02873
Case Type
Hearing Date / Time
Wed, 03/04/2026 - 10:00
Nature of Proceedings
Demurrer to First Amended Cross-Complaint
Tentative Ruling
For Plaintiff Citibank N.A.: Shane T. Wate, Hootan Atefyekta, Katie Zwarg, Julie M. VanderNoor Urner, Thomas J. Sebourn, Daria Iourtchenko, Robert S. Cox, Peter Tran, Suttell & Hammer, APC
For Defendant and Cross-Complainant Svetlana Dayal: Self-represented
For Cross-Defendants Citibank, N.A., Citigroup, Inc., and Jane Fraser: Adam Taryle, Matthew A. Morr, Ballard Spahr LLP
For Cross-Defendant Suttell & Hammer, APC: Luke K. Chamberlain, Messer Strickler Burnette, LTD.
RULING
For the reasons stated herein, the demurrer of cross-Defendants Citibank, N.A., and Citigroup, Inc., to the first amended cross-complaint of cross-complainant Svetlana Dayal, is ordered off-calendar.
The pro hac vice request of Matthew A. Morris granted.
Background:
As alleged in the complaint filed on May 7, 2025, by Plaintiff Citibank N.A. (Citibank or Plaintiff):
Citibank entered into a written agreement on June 14, 2017, with Defendant Svetlana Dayal (Dayal or Defendant). (Complaint, ¶ BC-1 & exhibit A.) The attached agreement is a “Card Agreement” for payment on a credit card account. (Complaint, exhibit A.)
On or about January 7, 2025, Defendant breached the agreement by failing to make payments when due. (Complaint, ¶ BC-2.) Plaintiff has performed all obligations to Defendant except those obligations Plaintiff was prevented or excused from performing. (Complaint, ¶ BC-3.) Plaintiff suffered damages in the unpaid amount due for a total of $16,761.33. (Complaint, ¶¶ BC-2, BC-4.)
The complaint, which is in the form of a Judicial Council form complaint, asserts one cause of action for breach of contract.
On August 20, 2025, the Court entered a minute order adopting its tentative ruling overruling the demurrer to the complaint filed by Defendant on June 6. Pursuant to that minute order, the Court directed Defendant to file and serve her answer to the complaint on or before September 4, 2025.
On August 27, 2025, Defendant filed an answer to the complaint, and separately filed a cross-complaint against Citibank, Jane Fraser (Fraser), and Suttell & Hammer, APC, (Suttell Hammer), alleging five causes of action: (1) violation of the Fair Debt Collection Practices Act or “FDCPA” (15 U.S.C. § 1692 et seq.; § 1692e, § 1692f, § 1692g) (against Suttell Hammer only); (2) violation of the Fair Credit Reporting Act or “FCRA” (15 U.S.C. § 1681 et seq.; § 1681s-2(b)) (against Citibank and Fraser); (3) defamation per se (against Citibank and Fraser); (4) restitution (unjust enrichment) (against Citibank and Fraser); and (5) unfair competition (Bus. & Prof. Code, § 17200) (against Citibank and Fraser).
On September 4, without any answer to the cross-complaint having been filed, Defendant filed a verified first amended cross-complaint (the FACC) against Citibank, Fraser, Suttell Hammer, and Citigroup, Inc., (Citigroup) (collectively, Cross Defendants), alleging the same five causes of action against the same parties described above, and adding Citibank to the first cause of action. As alleged in the FACC:
On or about October 10, 2024, Dayal executed an assignment of the account alleged in Plaintiff’s complaint, assigning said obligation to the account of the United States pursuant to Title 50 United States Code section 4305(b)(2), (FACC, ¶¶ 2, 5 & exhibit A.) On or about November 20, 2024, after allowing time for and receiving no objection from the United States Treasury, Dayal gave written notice of that assignment to Citibank and Citigroup, which is the parent company of Citibank, by certified mail addressed to Fraser who is the Chief Executive Officer of Citigroup. (FACC, ¶¶ 3-5 & exhibit A.) Neither Citibank, Citigroup, nor Fraser raised any objection to the assignment. (FACC, ¶ 4.)
Despite receiving notice of the assignment, Citibank retained Suttell Hammer, who contacted Dayal in a letter dated February 21, 2025, and identified itself as a “debt collector” charged with continuing efforts to collect upon the assigned obligation. (FACC, ¶ 6.) On or about March 5, 2025, Dayal responded to Suttell Hammer by written correspondence disputing the alleged obligation and demanding a validation. (FACC, ¶¶ 7, 13 & exhibit B.) Suttell Hammer failed to provide a validation and instead initiated a lawsuit against Dayal. (FACC, ¶ 8.) Cross-Defendants also published and continue to publish derogatory information to credit bureaus misrepresenting the status of the alleged debt and falsely attributing that debt as an obligation of Dayal. (FACC, ¶¶ 9.) As a result, Dayal has suffered reputational harm, impaired credit, and emotional distress. (FACC, ¶ 10.)
On October 20, Suttell Hammer filed an answer to the FACC, generally denying its allegations and asserting five affirmative defenses.
On October 28, the default of Citigroup was entered as requested by Dayal. That default was set aside pursuant to a minute order issued on January 21, 2026, and an order signed by the Court on January 24, and entered on January 26, pursuant to which the Court granted a motion filed by Citigroup on December 2, and opposed by Dayal, to set aside the default.
On January 28, 2026, the Court entered a minute order (the January Order) adopting its tentative ruling granting a motion by Suttell Hammer filed on November 18 (the anti-SLAPP motion), which was opposed by Dayal. The anti-SLAPP motion sought an order striking the FACC pursuant to Code of Civil Procedure section 425.16, on the grounds that each of the causes of action asserted in the FACC arise from pre-litigation activity undertaken in anticipation of filing of a lawsuit, and that Dayal does not have a probability of success on those causes. Pursuant to the January Order, the Court ordered the first cause of action for violation of the FDCPA alleged against Suttell Hammer and Citibank, stricken.
On February 4, Dayal filed a notice of appeal from the January Order granting the anti-SLAPP motion of Suttell Hammer.
On February 5, Citibank and Citigroup (collectively, the Citi Defendants) filed the present demurrer to the FACC, on the grounds that the FACC fails to state facts sufficient to constitute any cause of action against the Citi Defendants or Fraser because each cause of action relies on the premise that Dayal unilaterally assigned her credit card obligations to the United States pursuant to Title 50 United States Code section 4305, which the Court has rejected.
Dayal has filed an opposition to the present demurrer.
Analysis
Noted above, the first cause of action alleged in the FACC was stricken pursuant to the January Order. For this reason, the demurrer to that cause of action is moot.
“An order granting or denying a special motion to strike shall be appealable under [Code of Civil Procedure] [s]ection 904.1.” (Code Civ. Proc., § 425.16, subd. (j).) Subject to exceptions not relevant here, “the perfecting of an appeal stays proceedings in the trial Court upon the judgment or order appealed from or upon the matters embraced therein or affected thereby, including enforcement of the judgment or order....” (Code Civ. Proc., § 916, subd. (a).)
An appeal from an order granting or denying a special motion to strike brought under Code of Civil Procedure section 425.16 (California’s anti-SLAPP statute) “automatically stays further trial Court proceedings on the merits.” (Varian Medical Systems, Inc. v. Delfino (2005) 35 Cal.4th 180, 195 (Varian); see also Betz v. Pankow (1993) 16 Cal.App.4th 931, 938 [noting that “the trial Court is divested of jurisdiction of the subject matter during the pendency of an appeal....”].) “ ‘[A]n anti-SLAPP motion goes “to the merits of the issues involved in the main action” [citation] to the extent it addresses the “probability ... the Plaintiff will prevail on the claim” [Citation.]’ [Citation.]” (Barry v. State Bar of California (2017) 2 Cal.5th 318, 325; see also Varian, supra, 35 Cal.4th at p. 193 [the “granting [o]f a motion to strike under [Code of Civil Procedure] section 425.16 results in the dismissal of a cause of action on the merits....”].)
Considering the grounds stated in the notice of the present demurrer and described above (Kinda v. Carpenter (2016) 247 Cal.App.4th 1268, 1277 [“[a] basic tenet of motion practice is that the notice of motion must state the grounds for the order being sought”]), the Citi Defendants do not dispute and appear to concede that the January Order addressed the probability that Dayal would prevail on the claim that Dayal assigned her credit card obligations to the United States under Title 50 United States Code section 4305. The Citi Defendants also effectively concede that each of the causes of action alleged the FACC to which the present demurrer is directed, arise from or relate to that claim. For these and all further reasons discussed above, these proceedings go the merits of the claims and issues raised by Dayal in this action, “are embraced in or affected by” Dayal’s appeal from the January Order, and automatically stayed pursuant to Code of Civil Procedure section 916, subdivision (a). (Varian, supra, 35 Cal.4th at p. 191.)
The Court further notes that a demurring party must “file and serve with the demurrer a declaration stating either of the following:
“(A) The means by which the demurring party met and conferred with the party who filed the pleading subject to demurrer, and that the parties did not reach an agreement resolving the objections raised in the demurrer.
“(B) That the party who filed the pleading subject to demurrer failed to respond to the meet and confer request of the demurring party or otherwise failed to meet and confer in good faith.” (Code Civ. Proc., § 430.41, subd. (a)(3)(A)-(B).)
Though the Citi Defendants assert in the opening memorandum submitted in support of their demurrer, that they “conferred with Dayal about voluntarily dismissing her remaining claims...”, the Court has no record showing that the Citi Defendants filed or served a declaration in compliance with, or stating the matters required by, Code of Civil Procedure section 430.41.
For all reasons discussed above, these proceedings are automatically stayed, Furthermore, the demurrer is procedurally deficient. Therefore, and for these reasons, the Court will order the demurrer off-calendar.
The Court’s ruling herein is without prejudice to the refiling of a procedurally appropriate demurrer to the FACC by the Citi Defendants once the automatic stay of these proceedings is lifted. In addition, to the extent a party asserts that there exists a basis to lift that stay, or that these proceedings are not stayed by operation of law or the exercise of the Court’s discretion, the Court’s ruling is also without prejudice to the filing of any appropriate future motion for an order lifting the stay.