VIDA LARA; ET AL. vs. WINNRESIDENTIAL CALIFORNIA L.P.; ET AL.

Case No. CU25-06641

Defendant’s Motion to Strike Portions of Plaintiffs’ First Amended Complaint

While pleading motions are generally disfavored in class action cases, they can be granted when the requirements for class certification are not met by the plead allegations. Shaw v. Los Angeles Unified School Dist. (2023) 95 Cal.App.5th 740, 760- 761.

Thus, the court can consider the merits of this motion to strike, and grant it, but only if it appears the pleadings would not support a later certification of the subject Unauthorized Deductions Subclass.

A complaint in a class action case should provide a definition of a class (or subclass) based on objective characteristics which makes it possible for members of that class (or subclass) to identify themselves as class (or subclass) members.

[W]e conclude that the functions properly assigned to the ascertainability requirement are best served by regarding a class as ascertainable when it is defined “in terms of objective characteristics and common transactional facts” that make “the ultimate identification of class members possible when that identification becomes necessary.” (Hicks, supra, 89 Cal.App.4th at p. 915.) This standard was satisfied here because the class definition provided a basis for class members to self-identify. Noel v. Thrifty Payless, Inc. (2019) 7 Cal.5th 955, 967.

One of the deficient ways of defining a class (or subclass) is by a definition in terms of success on the merits, which are known as “fail-safe classes” (or fail-safe subclasses). Id. at 977, citing Mullins v. Direct Digital LLC (7th Cir. 2015) 795 F.3d 654, 659.

The objective term definition of a class (or subclass) avoids the possibility of exposing the defendant to multiple successive lawsuits brought by or on behalf of the same plaintiff(s).

[A] class proceeding must be maintained in a manner consistent with due process. A class definition framed in objective terms that make the identification of class members possible promotes due process in at least two ways. Such phrasing puts members of the class on notice that their rights may be adjudicated in the proceeding, so they must decide whether to intervene, opt out, or do nothing and live with the consequences. (See Hicks, supra, 89 Cal.App.4th at p. 914 [“[a]scertainability is required in order to give notice to putative class members as to whom the judgment in the action will be res judicata”].)

This kind of class definition also advances due process by supplying a concrete basis for determining who will and will not be bound by (or benefit from) any judgment. Allowing a class to be defined in vague terms, by contrast, could blunt any invocation of res judicata by the defendant in subsequent lawsuits brought by persons attempting to relitigate issues decided in the earlier class proceeding. The outcome might resemble that which obtains when the “one-way intervention” condemned by our decision in Fireside Bank v.

Superior Court (2007) 40 Cal.4th 1069, 1078 [56 Cal. Rptr. 3d 861, 155 P.3d 268] (Fireside Bank) occurs—the

defendant could be unfairly exposed to a succession of essentially duplicative class lawsuits (see id., at pp. 1078–1083). Id. at 980-981.

The Court found that the definition provided in that case for the class proposed a sufficiently ascertainable class.

The phrasing, “All persons who purchased the Ready Set Pool at a Rite Aid store located in California within the four years preceding the date of the filing of this action” is neither vague nor subjective. A member of the class could appreciate from this definition whether he or she is included within it, and thus be in a position to take appropriate steps to protect his or her interests. And the definition makes the res judicata consequences of a judgment clear, creating no ambiguity as to who will and will not be bound by the outcome. (See Daar, supra, 67 Cal.2d at p. 706.) Id. at 987.

In one federal court case, the following class definition was found to be an improper failsafe class: All persons within the United States who received any telephone call from Defendant or its agent/s and/or employee/s to said person's cellular telephone made through the use of any automatic telephone dialing system or with an artificial or prerecorded voice, which call was not made for emergency purposes or with the recipient's prior express consent, within the four years prior to the filing of the Complaint. Pepka v. Kohl's Dep't Stores, Inc. (C.D.Cal. 2016) 2016 U.S. Dist. LEXIS 186402, *2.

The district court in Pepka found that deciding who fell into this proposed class, defined as those suffering violations of the applicable law (the Telephone Consumer Protection Act), would require an evidentiary hearing to determine who was in the class.

Deciding who fell into Plaintiff's proposed class would "require the Court to engage in an improper merits evaluation to determine who is in the class." Lindsay Transmission, LLC, 2013 U.S. Dist. LEXIS 9554, 2013 WL 275568, at *4. Each potential class member would be subject to a "mini-hearing" on "the merits of each case." Id. Without such a hearing it would be impossible to determine if consent had been revoked and the calls made in violation of the TCPA. Id. at *10-11.

In the present case, Plaintiffs define the Unauthorized Deductions Subclass not by the literal language of the applicable statute (in Pepka, the TCPA).

All tenants of Defendants’ California properties whose leaseholds terminated between July 16, 2021, and the present, and who had a portion of their security deposit retained for a purpose not authorized by Civil Code section 1950.5(e).

The definition Plaintiffs alleged is even one more step removed from Pepka, by defining the class by referencing one subsection of the applicable statute itself, Civil Code

§1950.5, which if read into the defined subclass prescribes only in general terms what can be lawfully deducted from security deposits. This would make it even harder for layperson potential class members to self-identify by reading this definition in the first amended complaint (they would then also need to find, read and interpret the statute to have any clue as to whether they would be class members).

This ends the inquiry as to whether the definition of the Unauthorized Deductions Subclass is an improper fail-sale definition. It is. Thus, Defendants’ motion to strike is granted.

The harder issue is whether to grant the motion with leave to amend, or without.

The parties engaged in a heated dispute over whether deduction of utilities was or was not a category of expenses that by law cannot be properly deducted from a tenant’s security deposit by a landlord.

This is still an open question not yet decided by any reported California cases.

Of the non-binding authorities identified by each side in their briefs, the only source which provides any significant discussion of this issue is a federal court case. Phelps v. Air-GP LLC (C.D.Cal. October 6 2025) 2025 U.S.Dist.LEXIS 198628 [district court granted defendants’ motion to dismiss such a subclass; held that unpaid payments for certain utilities authorized by lease can be deducted from security deposit, under a theory of “additional rent”, and because the four categories identified in Civil Code §1950.5(b) are not exhaustive, because of the “including, but not limited to” language].

In Phelps, the federal district court had a copy of the lease attached to the complaint that it referenced for terms that supported its position that the landlord had a contractual right to payment of certain utilities from the named plaintiff.

While federal district court cases are not binding authority on California courts, the court finds Phelps to be persuasive authority.

Likewise, in the present case, the complaint and first amended complaint attached copies of the leases entered into by each of the two named Plaintiffs, VIDA LARA (“LARA”) and DEBRA HARKNESS (“DEBRA”).

While neither of the parties discussed these leases in their briefs, the court finds them to be crucial to its decision as to whether to grant this motion with or without leave to amend.

The lease for LARA checked none of the boxes listing different types of utilities that the landlord would pay, and included the following statement:

You’ll pay for all other utilities, related deposits, and any charges, fees, or services on such utilities . . . If any utilities are submetered for the dwelling unit,

or prorated by an allocation formula, we will attach an addendum to this Lease Contract in compliance with state agency rules or city ordinance.

In the “Special Provisions” part of the LARA Lease, there appears the following typed-in language:

Owner may apply any payment made by Tenant first toward settlement of any damages, repairs, utilities, late charges, or costs incurred on your behalf, and to any unpaid balance on your account and then to the payment of rent notwithstanding any dates or other direction from Tenant that accompanies any such payment . . . .

One of the documents attached to the LARA Lease was a Utilities and Services Addendum, in which certain specified utilities such as water, sewer and trash services were to be billed by the service provider to the landlord and then allocated to the tenant based on a specified formula.

Another of the documents attached to the copy of LARA Lease is a Water Service Law Additional Information sheet, referencing the water submeter, identified as “used to separately bill tenants for water service”. That document, signed by LARA and her cotenants, includes the following provision:

Security Deposit.

We may, at our discretion, deduct an unpaid water service bill from the security deposit during or upon termination of a tenancy, if the last water service bill showing the amount due is attached to the documentation required by Section 1950.5 . . . .

The Lease Agreement for named Plaintiff HARKNESS is different, as some of the boxes for utilities to be provided by the landlord are checked (those for water, wastewater and trash; but those for gas, electricity, master antenna and cable TV are unchecked). The court did not find a lot of the attachments that were present for the LARA Lease, such as the Utilities and Services Addendum regarding prorating of certain types of utilities. However, at the end of the HARKNESS Lease, there appears the same typed-in language about the owner being able to apply any payment made by the tenant first toward settlement of any damages, repairs, utilities, late charges, or costs incurred on the tenant’s behalf, and to any unpaid balance.

Unlike Plaintiff LARA, Plaintiff HARKNESS did not expressly allege that utilities were (improperly) deducted from her security deposit.

HARKNESS’s claims were limited to the delay in receiving the return of her security deposit.

Thus, neither LARA nor HARKNESS would appear to be proper subclass representatives for an Unauthorized Deductions Subclass amended to be defined as those against whom utilities were improperly deducted from their security deposits.

With there appearing to be no reasonable possibility that Plaintiffs could amend the first amended complaint to allege an Unauthorized Deductions Subclass for tenants against whose security deposits utilities were deducted, the court grants Defendants’ motion to strike all allegations regarding the Unauthorized Deductions Subclass without leave to amend.

Defendants have 10 days to file an answer to the remainder of the first amended complaint.

EBONAE WEBB vs. PACE SOLANO INC.