Covarrubias vs. C Plus Electronics, Inc.

# Case Name Tentative 26 Joslin vs. Fidelity National Law Group

24-01440293 1. Demurrer to Amended Complaint 2. Motion to Strike Portions of Complaint

No Tentative Ruling. Parties to Appear on Zoom or in Person.

49 Covarrubias vs. C Plus Electronics, Inc.

25-01525830 Motion to Dismiss

The Motion to Dismiss brought by Defendants C Plus Electronics, Inc. and Froilan Becerra is GRANTED in part, pursuant to Code of Civil Procedure section 410.30. This action shall be stayed, to permit Plaintiff to pursue litigation in Mexico. The request for a dismissal is denied.

Defendants’ Request for Judicial Notice is GRANTED, pursuant to Evidence Code section 452, subdivision (d).

Plaintiff’s Request for Judicial Notice is GRANTED, as to Exhibit 3, pursuant to Evidence Code section 452, subdivision (f). The remainder of Plaintiff’s Request for Judicial Notice is DENIED, as irrelevant. While Exhibits 1 and 2 are court records which generally may be noticed pursuant to Evidence Code section 452, subdivision (d), the offered court records arise from an unrelated action. Plaintiff has not established that the documents are relevant to this motion. (Zucchet v. Galardi (2014) 229 Cal.App.4th 1466, 1474, fn. 5, citing Jordache Enterprises, Inc. v. Brobeck, Phleger & Harrison (1998) 18 Cal.4th 739, 748, fn. 6.)

“When a court upon motion of a party or its own motion finds that in the interest of substantial justice an action should be heard in a forum outside this state, the court shall stay or dismiss the action in whole or in part on any conditions that may be just.” (Code of Civ. Proc., §410.30, subd. (a).)

“Forum non conveniens is an equitable doctrine invoking the discretionary power of a court to decline to exercise the jurisdiction it has over a transitory cause of action when it believes that the action may be more appropriately and justly tried elsewhere.” (Stangvik v. Shiley Inc. (1991) 54 Cal.3d 744, 751.) “In determining whether to grant a motion based on forum non conveniens, a court must first determine whether the alternate forum is a ‘suitable’ place for trial. If it is, the next step is to consider the private interests of the litigants and the interests of the public in retaining the action for trial in California.” (Ibid.)

With respect to the first question of suitability, “[a]n alternative forum is suitable if it has jurisdiction and the action in that forum will not be

barred by the statute of limitations.” (Guimei v. General Electric Co. (2009) 172 Cal.App.4th 689, 696.)

“It is well settled under California law that the moving parties satisfy their burden on the threshold suitability issue by stipulating to submit to the jurisdiction of the alternative forum and to waive any applicable statute of limitations.” (Hahn v. Diaz-Barba (2011) 194 Cal.App.4th 1177, 1190.) “It is apparent that when the defendants meet this burden, a burden of production falls on the plaintiffs if they wish to show the alternative forum is nonetheless unsuitable because the action cannot be brought there despite the defendants’ stipulations.” (Id. at p. 1191.)

The burden “‘quickly shifts to the plaintiff on the issue of appropriateness of the alternative forum once the defendant consents to jurisdiction in the alternative forum.’” (Ibid.) “If the plaintiffs produce competent and persuasive evidence showing that despite the defendants’ stipulations the action cannot be brought in the alternative forum, it is then the defendants’ burden to respond with countervailing evidence as they have the ultimate burden of persuasion.” (Ibid.)

Here, Defendant Froilan Becerra, the President and Chief Executive Officer of C Plus Electronics, Inc. declares: “C Plus Electronics, Inc. and I are willing to submit to jurisdiction in Mexico should this Court dismiss this action based on forum non conveniens.” (¶1 and ¶9 of Becerra Declaration.) Additionally, Defendant states: “We agree to toll of the statute of limitations during the pendency of the actions in California.” (¶10 of Becerra Declaration.)

In response to the above showing, “Plaintiff concedes for purposes of this Motion that Mexico can potentially be a suitable forum” (Opposition: 8:9-10); however, Plaintiff nonetheless asserts the offered stipulation is insufficient.

Plaintiff asserts the applicable statute of limitations in Mexico is oneyear and that, regardless of the offer to toll the limitations period while actions were pending in California, the statute of limitations “would have lapsed in September 2024.” (Opposition: 8:16-18.)

Multiple Courts have found stipulations which tolled the statute of limitations “during the pendency of the proceedings in California,” sufficient to demonstrate a suitable alternative forum. (See Chong v. Superior Court (1997) 58 Cal.App.4th 1032, 1038; See also Shiley Inc. v. Superior Court (1992) 4 Cal.App.4th 126, 131-132 and Stangvik v. Shiley Inc. (1991) 54 Cal.3d 744, 752.) However, it does not appear that application of the statute of limitations was further challenged within these actions.

It is unclear whether Plaintiff’s claims will in fact be barred, under Mexican law. To demonstrate the same, Plaintiff cites Mexican Federal

Labor Law which states: “Labor actions are subject to the statute of limitations of one year, counted from the day following the date on which the obligation becomes due...” (See Exhibit 3 of Plaintiff’s RJN [ROA No. 27].) While Plaintiff indicates this action arises from her employment with Defendant (¶8 of Complaint), Plaintiff has not established the above “labor action” limitation applies where, as here, her employment was governed by an express contract. (¶20 of Complaint.)

Defendants did not respond to this argument.

Regardless, where the determination that a foreign court is suitable is “based in part on the promises and stipulations entered into by defendants in this forum” and “based on our own analysis of [Mexico’s] statutes of limitations,” the appropriate course of action is to stay, rather than dismiss. (Investors Equity Life Holding Co. v. Schmidt (2015) 233 Cal.App.4th 1363, 1368.) “[W]hen the assessment of the alternative forum’s suitability is dependent upon factors beyond the control of the California courts – such as the interpretation of another state’s laws – then a stay of the California litigation might be justified, when an outright dismissal would not be.” (Id. at p. 1376.)

Applying the above herein, the Court finds that Mexico is a suitable forum; however, this determination is based on Defendants’ having indicated they will submit to the jurisdiction of Mexico and based on Defendants apparent representation that the statute of limitations will pose no bar to this action, in Mexico. Given the same, the Court will merely stay and not dismiss this action.

To any extent it is later determined that Plaintiff’s claims cannot proceed in Mexico, due to the statute of limitations or lack of jurisdiction, the stay herein will be lifted.

Proceeding to the private and public interests, the Court finds the same weigh in favor of Mexico.

“The private interest factors are those that make trial and the enforceability of the ensuing judgment expeditious and relatively inexpensive, such as the ease of access to sources of proof, the cost of obtaining attendance of witnesses, and the availability of compulsory process for attendance of unwilling witnesses.” (Stangvik v. Shiley Inc. (1991) 54 Cal.3d 744, 751.) “The public interest factors include avoidance of overburdening local courts with congested calendars, protecting the interests of potential jurors so that they are not called upon to decide cases in which the local community has little concern, and weighing the competing interests of California and the alternate jurisdiction in the litigation.” (Ibid.)

Here, it is undisputed that Defendants reside in California, while Plaintiff resides in Mexico. (See ¶2 of Ruddell Declaration and Exhibit A thereto; See also ¶3 of Becerra Declaration.)

Where a Plaintiff resides outside the state, their “choice of forum is much less reasonable and is not entitled to the same preferences as a resident of the state where the action is filed.” (Stangvik v. Shiley Inc. (1991) 54 Cal.3d 744, 755.) As explained by the California Supreme Court, the fact a foreign Plaintiff chose to file their Complaint in California “is not a substantial factor in favor of retaining jurisdiction here.” (Ibid.)

However, “Defendant’s residence is also a factor to be considered in the balance of convenience.” (Stangvik v. Shiley Inc. (1991) 54 Cal.3d 744, 756.) “[W]hen the defendant is a California resident, California is a presumptively convenient forum, but the presumption may be overcome by showing that the alternate jurisdiction is a more convenient place for trial of the action.” (Campbell v. Parker-Hannifin Corp. (1999) 69 Cal.App.4th 1534, 1541; See also Stangvik v. Shiley Inc. (1991) 54 Cal.3d 744, 756.)

While Defendants’ residence in California makes the state presumptively convenient, Defendants have rebutted this presumption by reference to the location of evidence.

Per Defendants “[a]ll of Ms. Covarrubias’s customer contacts were Mexican entities located in Mexico” and “[h]er communications regarding customer accounts were conducted in Spanish with Mexican businesses.” (¶4 of Becerra Declaration.) Additionally, per Defendants, the relevant Mexican customers will “have first-hand knowledge of disputed transactions, payment issues, product returns, and credits that directly affect the commission calculations at issue in this case.” (¶7 of Becerra Declaration; See also ¶5 of Becerra Declaration.)

Defendants indicate, finally, that “[d]ue to an incident involving the loss of certain computer files at C Plus, we do not have complete internal records of all transactions.” (¶6 of Becerra Declaration.) “To prove that Ms. Covarrubias’s commission calculations are incorrect, we need to rely on the records and testimony of the Mexican companies to which those sales were made.” (Ibid.)

The above is sufficient to establish that important evidence is in Mexico. While Plaintiff attempts to dispute the above, she does so primarily via a declaration made on “information and belief.” (¶6 of Covarrubias Declaration.) However, “[a]n affidavit based on ‘information and belief’ is hearsay and must be disregarded [citation removed] and it is ‘unavailing for any purpose’ whatsoever.” (Star Motor Imports, Inc. v. Superior Court (1979) 88 Cal.App.3d 201, 204.)

Additionally, Plaintiff declares she was told by Mr. Becerra, on March 27, 2019, “that the C Plus computer system had been hacked and data from 2018 and 2019 was lost....” (¶9 of Covarrubias Declaration.) While Plaintiff asserts the above is the “incident involving the loss of certain computer files” referenced by Mr. Becerra and further asserts the above will not affect data relating to commissions earned between 2021 and 2023, this argument is speculative.

Regardless of Plaintiff’s speculation as to the cause, Mr. Becerra declares under penalty of perjury that Defendants “do not have complete internal records of all transactions.” (¶6 of Becerra Declaration

While Plaintiff proceeds to indicate that, “[a]side from myself, I am not aware of any other witnesses in Mexico who are necessary to the resolution of this dispute” (¶7 of Covarrubias Declaration), it nonetheless appears that important evidence is located only in Mexico, beyond the reach of California courts.

Plaintiff does not dispute that documents and witnesses located in Mexico cannot be compelled to appear in California. Pursuant to Code of Civil Procedure section 1989, a witness “is not obliged to attend as a witness before any court, judge, justice or any other officer, unless the witness is a resident within the state at the time of service.”

In contrast, Defendants have agreed to make documents in their possession available in Mexico, as well as to present employees to testify in Mexico. (¶11-¶12 of Becerra Declaration.)

Based on the above, the private interests weigh in favor of Mexico.

With respect to the public interests, “a state has a strong interest in assuring its own residents an adequate forum for the redress of grievances.” (Stangvik v. Shiley Inc. (1991) 54 Cal.3d 744, 754-755.) Based on the same, Mexico has a strong interest, with respect to its resident, Plaintiff.

Plaintiff recognizes that “Mexico certainly has at least some interest in the employment of its residents even when working for foreign corporations” (Opposition: 11:21-22), but nonetheless asserts California has an interest in deciding actions against California corporations.

While California has an interest in deterring wrongful conduct by California corporations, the Court finds that “the additional deterrence that would result if defendants were called to account for their allegedly wrongful conduct in a California court rather than in the courts of [Mexico] would be negligible.” (Stangvik v. Shiley Inc. (1991) 54 Cal.3d 744, 754-759.)

Consequently, the public interest weighs in favor of Mexico.

Based on all the above, the Motion is GRANTED, with the limitation that this action shall be stayed, rather than dismissed.

50 Banc vs. Plaza Continental Group LLC

25-01496549 Demurrer to Amended Cross-Complaint

The Demurrer to the First Amended Cross Complaint brought by Cross- Defendant Nano Banc is SUSTAINED, in whole, with 20 days leave to amend.

Cross-Defendant’s Request for Judicial Notice is GRANTED, with the limitation that the Court notices only the existence of the Notice of Default and not the truth of any factual statements therein. (Poseidon Development, Inc. v. Woodland Lane Estates, LLC (2007) 152 Cal.App.4th 1106, 1117.)

The demurrer to the First Cause of Action for Breach of Contract is SUSTAINED, as the Cross-Complaint does not adequately allege performance, as required. (Oasis West Realty, LLC v. Goldman (2011) 51 Cal.4th 811, 821.)

The Cross-Complaint alleges Borrower fully performed all obligations required under the Loan Agreements or was excused from further performance due to Cross-Defendant’s breaches.” (¶48 of FACC.) While the above general allegation would typically suffice (See Careau & Co. v. Security Pacific Business Credit, Inc. (1990) 222 Cal.App.3d 1371, 1389 and Code Civ. Proc., § 457), “general pleadings are controlled by specific allegations.” (Careau & Co. v. Security Pacific Business Credit, Inc. (1990) 222 Cal.App.3d 1371, 1389.) “Thus, a general allegation of due performance will not suffice if the plaintiff also sets forth what has actually occurred and such specific facts do not constitute due performance.” (Id. at pp. 1389-1390.)

In contrast to the allegations of performance, several allegations within the Cross-Complaint suggest Cross-Complainant did not pay the loan before the maturity date and, instead, continued tendering monthly payments “expecting the Bank to implement the promised restructuring...” (See ¶74 of FACC; See also ¶30, ¶31.)

In light of the above specific allegations which contradict the general assertion of performance, Cross-Complainant has not adequately alleged this element of its claim.

Similarly, Cross-Complainant has not adequately alleged a breach. While the opposition suggests that pre-maturity breaches have been alleged,