Order After Hearing POSCal. Super. - 6th Dist.September 21, 2016\OOONONUILUJNH NNNNNNNNN-dr-‘t-A-AHHHH-AH OONQMAUJNHOOOONONUIAUJN-‘O FILED 23m m 20 A u: 23 95 F13? QF THE Cam T, j Lo'm'é‘rbavljavcru SUPERIOR COURT OF CALIFORNIA COUNTY 0F SANTA CLARA MICHAEL HANNEKEN, Case No.: 16-CV-300285 Plaintiff: ORDER RE: DEMURRER T0 FAC VS. LELAND STANFORD JUNIOR UNIVERSITY, et al., Defendants. The demurrer to the first amended complaint filed by defendants Leland Stanford Junior University and William J. Perry came 0n for hearing before the Honorable Maureen A. Folan 0n April 20, 2017, at 9:00 am. in Department 8. The matter having been submitted, the Court orders as follows: This is a breach of contract and fraud action initiated by plaintiff Michael Hanneken (“Plaintiff”) against defendants Leland Stanford Junior University (“Stanford”) and William J. Perry (“Secretary Perry”) (collectively “Defendants”). According to the allegations 0f the operative first amended complaint (“PAC”), Plaintiff is a military veteran and lifelong member of the United States Army Reserves. (FAC, 1} 1.) In addition to being a veteran, Plaintiff is also an entrepreneur who created a successful 1 ORDER RE: DEMURRER r \OOOQQUILUJN 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 professional services firm. (Id. at 11 2.) Despite his success as a businessman, Plaintiff decided to return t0 graduate school with the goal 0f enhancing his military career. (Id. at 11 3.) Plaintiff enrolled at Stanford in order t0 achieve those goals after having numerous conversations with Stanford personnel, including Secretary Perry. (FAC, 11 5.) Plaintiff enrolled under the belief Stanford would help his military career. (Ibid) Prior to enrolling, Plaintiff asked staff and faculty at Stanford Whether he would be able to receive constructive credit as a student at Stanford. (Ibid) Constructive credit allows a service member to apply educational credit towards courses offered at the United States Army War College. (Id. at fl 15.) Staff and faculty responded that they believed he would be able to obtain constructive credit and Secretary Perry was solely in charge of recommending a student receive it. (Id. at 1] l7.) Two months after classes began, Plaintiff obtained a meeting with Secretary Perry. (Id. at fll 5.) During the meeting, Secretary Perry promised to provide Plaintiff with a letter of recommendation supporting his request for constructive credit in exchange for Plaintiff enrolling in specific courses and performing security-based doctoral research not otherwise required. (Ibid) Plaintiff subsequently enrolled in those courses and engaged in security-based doctoral research in reliance on Secretary Perry’s promise. (Id. at fl 6.) After several requests for the letter of recommendation, Plaintiff was told Secretary Perry would not provide one. (Id. at 11 7.) The FAC does not allege whether Plaintiff received constructive credit. The FAC asserts causes of action for breach of oral contract, promissory estoppel, and negligent misrepresentation. Currently before the Court is Defendants’ demurrer to each cause of action on the ground of failure to state facts sufficient to constitute a cause of action. I. Request for Judicial Notice In support of the demurrer, Defendants request judicial notice of the following documents filed in this action: (1) the FAC; (2) the original complaint; and (3) defendants’ demurrer to the original complaint. These court documents are proper subjects for judicial notice pursuant to Evidence Code section 452, subdivision (d), which allows courts to take judicial notice of court records. Additionally, the documents are relevant to issues under review in the demurrer. 2 ORDER RE: DEMURRER \OOOQONUI-bUJN 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 (Silverado Modjeska Recreation and Park Dist. v. County 0f0range (201 1) 197 Cal.App.4th 282, 307 [A precondition t0 judicial notice is that the matter t0 be noticed be relevant to a material issue before the court].) Accordingly, the request for judicial notice is GRANTED. II. Meet and Confer Defendants’ attorney filed a declaration in support of the demurrer stating he met and conferred With Plaintiff s counsel prior t0 filing the demurrer. (Lamphere Dec1., 1m 2, 3.) In opposition, Plaintiff s attorney filed a declaration in Which he states Defendants’ attorney “did 9’ 6‘ not offer a compromise to demurrer, summarized an abbreviated version of the table 0f contents” during their discussion, “mentioned additional arguments,” and “provided a few case citations.” (Giacchetti Decl., 11 4.) Plaintiff s attorney further attests counsel for Defendants misrepresented the depth 0f the issues discussed during their telephone call. (Id. at 11 6.) While Plaintiff does not affirmatively state the meet and confer was inadequate, he suggests this by his comments. i Pursuant t0 Code of Civil Procedure section 430.41, subdivision (a), prior to filing a demurrer, the moving party shall meet and confer with the party who filed the pleading t0 determine whether an agreement can be reached that would resolve the obj ections raised by the demurrer. During the meet and confer process, “the demurring party shall identify all of the specific causes of action that it believes are subject to demurrer and identify with legal support the basis of the deficiencies.” (Code Civ. Proc., § 430.41, subd. (a)(l).) The party who filed the pleading shall, in turn, provide legal support for his or her position that it is legally sufficient. (Ibid) Here, counsel for both parties discussed the merit of the arguments raised in the demurrer on the telephone on February 10, 2017. (Lamphere Decl, 11 2.) After this discussion, the parties exchanged e-mails addressing their conversation and summarizing their conversation. Plaintiff” s counsel states they discussed all three causes of action. (Giacchetti Decl., Exhibit A.) Counsel for Defendants replied to the e-mail and emphasized that the demurrer to the FAC would be 3 ORDER RE: DEMURRER \OOONONM-PWNp-A NNNNNNNNNp-Ap-A-Ap-np-tp-tr-tw-dp-tp-t OOVOUI-PUJNHOKOOONONUIAUJNHO substantially similar t0 the demurrer filed to the original complaint.1 (Id. at Exhibit B.) Plaintiff‘s attorney was in possession of the demurrer t0 the original complaint and able t0 consult it in order to View specific legal authority. (Ibid) Based on the above facts, Defendants adequately met and conferred with Plaintiff prior to filing this demurrer. Defendants identified each cause of action at issue in the demurrer and legal support addressing their arguments. T0 the extent Plaintiff asserts Defendants inadequately met and conferred because they did not offer to compromise, there is no legal authority requiring a party t0 offer to compromise. The fact that two parties could not come to an agreement does not render the meet and confer process inadequate. Therefore, Defendants sufficiently met and conferred with Plaintiff. III. Merits of the Demurrer A. First Cause of Action - Breach 0f Oral Contract Defendants argue Plaintiff fails t0 plead an enforceable contract, the element of causation, and the authority for Secretary Perry t0 contract 0n Stanford’s behalf. Defendants additionally argue the statute 0f frauds bars the claim. 1. Enforceability 0f the Contract Defendants assert the terms 0f the contract are s0 vague the contract is void. Specifically, Defendants contend Plaintiff does not specify the contents 0f the recommendation letter, and the contract is therefore too vague t0 enforce. In addition, Defendants argue the promise Plaintiff made to take security-based research classes and perform security-based doctoral research is ambiguous. “Where a contract is s0 uncertain and indefinite that the intention of the parties in material particulars cannot be ascertained, the contract is void and unenforceable.” (Ladas v. California State Auto. Assn. (1993) 19 Cal.App.4th 761, 770, citations omitted.) For example, the promise to consider changing policies to achieve pay parity is indefinite because the promise to “consider” is amorphous. (Ibid.) 1 The demurrer was not heard by the Court because Plaintiff filed the FAC prior to the hearing, rendering the demurrer moot. 4 ORDER RE: DEMURRER \OOONGUI-RUJNH NNNNNNNNNv-‘r-‘Hr-nHHHH-‘H OOQQMAWN-‘OCOOQQU‘I-PUJNHO Here, the terms of the contract are sufficiently definite. As persuasively argued by Plaintiff, the allegations clearly reflect the promises each party allegedly made. Plaintiff adequately pleads Secretary Perry promised t0 write a letter of recommendation to strengthen his application for constructive credit, and in return, Plaintiff promised t0 enroll in certain courses. Further, Plaintiff alleges key factual details supporting the existence of the alleged promises. For example, Plaintiff alleges that prior t0 the meeting with Secretary Perry, he provided a letter detailing What courses he would take and the focus 0f the research. (FAC, 1m 18-21 .) The Court finds the allegations 0f the existence of the contract t0 be sufficiently definite. Accordingly, the demurrer on the basis the contract is not enforceable is not sustainable. 2. Causation Defendants identify the alleged damages as the receipt 0f constructive credit and argue this injury could not have been caused by the failure to provide a letter 0f recommendation because Plaintiff does not allege his request for constructive credit has been denied. In opposition, Plaintiff states Defendants improperly limit the scope of alleged damages. T0 state a claim for breach 0f contract, the plaintiff must plead his or her damages were proximately caused by the defendant’s actions. (US Ecology, Inc. v. State (2005) 129 Cal.App.4th 887, 909.) While Plaintiff acknowledges the non-receipt of constructive credit is an alleged injury, he also points to other alleged injuries that were caused by reliance on Defendants’ promises. Plaintiff pleads that due to his extra time at Stanford, he sacrificed substantial economic opportunities with his successful business company and spent three years longer than necessary at Stanford. (FAC, 1H] 6-7, 27, 28.) Plaintiff further alleges he only enrolled in these courses and invested his time into the doctoral research because of Defendants’ promise to provide him with a recommendation. Thus, Defendants’ identification of Plaintiff” s alleged damages only focuses on the receipt of constructive credit and ignores the other alleged damages. As a result, Defendants’ argument does not fully address Plaintiffs’ alleged injury. Therefore, the demurrer is not sustainable on the basis Plaintiff fails to plead the element of causation. 5 ORDER RE: DEMURRER \OOONONUI-RUJNH NNNNNNNNNu-a-tp-v-np-tr-‘p-Ap-a-AH OONOUl-RWNF-‘OOOONONUI-PUJN-‘O 3. Authority to Enter into Contract Defendants contend Plaintiff fails to allege Secretary Perry had authority to contract on Stanford’s behalfbecause he does not allege any acts by Stanford suggesting Secretary Perry had ostensible authority to enter it into contracts. It appears Defendants intend t0 argue that as a result of the lack of ostensible authority, Stanford did not consent t0 the contract. Consent is an essential element t0 the existence of a contract. (Civ. Code, § 1550.) An agent may be authorized to carry-out any ordinary business transaction on behalf of the principal, including entering into contracts. (Whittaker v. Otto (1961) 188 Cal.App.2d 619, 623; see also CiV. Code, §§ 2304-2309.) There are two types of such authority: actual and ostensible. (Tomerlin v. Canadian Indem. Co. (1964) 61 Cal.2d 638, 643.) Neither party advances any argument that Secretary Perry had actual authority to bind Stanford to a contract; the only fonn of authority at issue is ostensible authority. “[O]stensib1e authority arises as a result of conduct of the principal which cause the third party reasonably t0 believe that the agent possesses the authority to act 0n the principal’s behalf.” (Tomerlin v. Canadian Indem. C0,, supra, 61 Ca1.2d at p. 643.) “Ostensible agency cannot be established by the representations or conduct 0f the purported agent; the statements 0r acts 0f the principal must be such as to cause the belief the agency exists.” (J.L. v. Children’s Institute, Inc. (2009) 177 Cal.App.4th 388, 404.) An agent’s authority may be implied from the circumstances ofa particular case. (Kelley v. RF. Jones C0. (1969) 272 Ca1.App.2d 113, 120.) The principal’s consent to the agency need not be express. (Tomerlin v. Canadian Indem. Ca, supra, 61 Ca1.2d at p. 644.) Here, Plaintiff alleges Secretary Perry is the director of the War College at Stanford University, director of the Preventative Defense Proj ect for Center for International Security and Cooperation (“CISAC”), and a professor emeritus. (FAC, 11 16.) Plaintiff additionally pleads Secretary Perry oversees Military Fellows at Stanford who receive military credit for academic studies - the same transaction at issue here with respect to the constructive credits Plaintiff sought. (Ibid) Secretary Perry is allegedly the sole person at Stanford to decide whether to support a request for constructive credit. (1d. at 11 18.) Further, other Stanford personnel 6 ORDER RE: DEMURRER OOOQONMAUJN-a NNNNNNNNN-lr-Ay-d-A-Ap-Aw-‘HH OOQQM-PWNHOOOOflom-RWNHO represented Secretary Perry would consider Plaintiff‘s request for constructive credit should he choose t0 attend Stanford. (Id. at 1H} 3, 5, 15, 22.) The Court finds these allegations sufficiently reflect that Stanford held Secretary Perry out as someone Who could provide a letter of recommendation for Plaintiff to receive constructive credit, particularly as he is allegedly the only individual at Stanford who may grant such requests. Accordingly, the demurrer is not sustainable on the basis Plaintiff failed to plead Secretary Perry had authority to enter into a contract. 4. Statute of Frauds Defendants assert the breach of contract cause of action is barred by the statute of frauds because the promise to perform certain coursework took Plaintiff years to fulfill. Therefore, according to Defendants, “[t]hese allegations establish that the coursework Plaintiff alleges was part ofhis side bargain could not have been performed within one year.” (Mem. Ps. & As., p. 8: lis. 23-26.) The statute of frauds is codified in Civil Code section 1624, which in relevant part provides that an oral contract is unenforceable if by its terms it will not be performed within one year or during the lifetime of the promisor. “To fall within the words of this provision . . ., the agreement must be one of which it can truly be said at the very moment it is made, ‘[t]his agreement is not to be performed within one year[.]”” (White Lighting C0. v. Wolfson (1968) 68 Cal.2d 336, 343, fn. 2, citations omitted.) “A general demurrer may be interposed when the complaint shows on its face that the agreement sued on is within the statute of frauds and does not comply with its requirements.” (Parker v. Solomon (1959) 171 Cal.App.2d 125, 136.) Here, the contract does not clearly fall within the statute of frauds because the alleged terms of the contract do not expressly preclude performance within one year. Defendants’ entire argument is predicated 0n the fact Plaintiff alleges it took three years to complete certain coursework. However, that fact alone does not preclude the possibility of completing the coursework in less than one year. There are no facts alleged in the FAC suggesting it was impossible for Plaintiff to complete the agreed-upon coursework within one year, and it is 7 ORDER RE: DEMURRER \OOONQUI-PUJN 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 otherwise conceivable that the coursework could have been completed within one year. Therefore, the demurrer is not sustainable on the basis it is barred by the statute of frauds. 5. Conclusion In sum, Defendants fail to advance any successful argument that could serve as a basis for sustaining the demurrer to the breach of contract claim. Accordingly, the demurrer t0 the first cause of action on the ground of failure to state sufficient facts to constitute a cause 0f action is OVERRULED. B. Second Cause of Action - Promissory Estoppel Defendants assert Plaintiff fails to plead a claim for promissory estoppel because he does not adequately allege a clear and unambiguous promise, the element of reliance, and the element of injury. Defendants additionally contend the claim is barred by the statute of frauds. 1. Promise Defendants advance the same argument here that the promise is ambiguous as it does with respect to the breach of contract claim. Once again, Defendants contend the promise t0 write a recommendation letter is vague because Plaintiff does not plead the exact contents of the letter. One element of a claim for promissory estoppel is “a promise clear and unambiguous in its terms[.]” (Laks v. Coast Fed. Sav. & Loan Assn. (1976) 60 Cal.App.3d 885, 890.) A promise has been held not t0 be clear and ambiguous when the promise was not intended t0 be final and there will undoubtedly be further negotiations. (Ibid) Such is not the case here. For the reasons stated above, the Court finds this promise t0 be sufficiently definite. The fact that Plaintiff does not plead the exact contents 0f the letter is not detenninative as the promise contains key provisions as to what must be written in the letter, i.e. support for receiving constructive credit. The alleged facts d0 not suggest any additional negotiation was required or that the parties did not decide a term of the promise. Accordingly, the demurrer is not sustainable 0n the basis the promise is not clear and ambiguous. 8 ORDER RE: DEMURRER \OOONQUl-PUJNH NNNNNNNNNHh-lp-A-Ar-Ip-Av-IHHH WNQMAWNHOOOOflom-RWNHO 2. Reliance Defendants insist Plaintiff fails to adequately plead the element of reliance because reliance was not reasonably foreseeable. Defendants additionally argue Plaintiff fails t0 plead the element 0f reliance because he alleges the existence 0f consideration in connection with a breach of contract claim, i.e. a promise that was “bargained for.” Therefore, it appears Defendants intend to argue Plaintiff may not plead inconsistent claims. Reliance is an element of a claim for promissory estoppel, and such reliance must be reasonably foreseeable. (Laks v. Coast Fed. Sav. & Loan Assn, supra, 60 Cal.App.3d at p. 890.) In other words, a plaintiff must allege “[a] promise which the promisor should reasonably expect to induce action or forebearance of a definite and substantial character 0n the part 0f the promise[.]” (Diede C0nst., Inc. v. Monterey Mechanical C0. (2004) 125 Cal.App.4th 380, 385.) Defendants assert Plaintiff does not plead he reasonably relied on Secretary Perry’s promise because he does not plead any facts supporting the conclusion that such reliance was reasonably foreseeable. In support, Defendants point t0 a lack of any allegations suggesting Plaintiff told anyone at Stanford he was relying on Secretary Perry’s promise. This contention lacks merit. A review of the pleading reveals Plaintiff adequately pleads the element 0f reasonably foreseeable reliance. Prior t0 enrolling at Stanford, Plaintiff asked multiple employees about the possibility of receiving constructive credit. (FAC, 1H] 15, 36.) As a part of these discussions, Plaintiff alleges he specifically inquired about whether he would be able to receive a letter of recommendation from Secretary Perry and described the “central role” Secretary Perry and obtaining constructive credit played in his choice to attend Stanford. (Id. at 1W 16, 18.) Plaintiff additionally alleges after enrolling at Stanford, he continued to inquire with other members of the faculty if he would be able to receive constructive credit and receive a letter of recommendation. (Id. at 11 17.) The staff replied that they believed so because Secretary Perry “is the sole person to consider whether to support a request for constructive credit.” (Ibid) The co-director of CISAC even allegedly advised Plaintiff on how to obtain Secretary Perry’s support. (Id. at 11 17.) After these conversations, a meeting was arranged between Plaintiff and Secretary Perry so that he could inquire about receiving constructive credit. (Ibid) After 9 ORDER RE: DEMURRER \OOONONUI-h-UJNH NNNNNNNNNb-‘b-lt-lr-lt-Ab-IHHHH OOflmm-PWNHOKOOOQQM-bWNHO Plaintiffs discussions with Secretary Perry and other faculty, Plaintiff relied 0n the promise to provide a letter 0f recommendation by enrolling in certain courses and performing doctoral research that he would not have otherwise undertaken. (Id. at 1W 23-24, 27.) Based 0n the above, it is reasonably foreseeable that Plaintiff would rely on the numerous representations from staff members and other faculty that Secretary Perry would provide him with a letter of recommendation. Turning to whether Plaintiff may plead both a claim for breach of contract and promissory estoppel, a claim for promissory estoppel is distinct from a claim sounding in contract because the element of detrimental reliance is regarded as a substitute for consideration. (Douglas E. Barnhart, Inc. v. CMC Fabricators, Inc. (2012) 211 Cal.App.4th 230, 242.) Thus, “where the promisee’s reliance was bargained for, the law of consideration applies; and it is only where the reliance was unbargained for that there is room for application of the doctrine of promissory estoppel.” (Id. at pp. 243-44, citations omitted.) Therefore, Defendants’ general statement of law that a promise in a claim for promissory estoppel may not be bargained for is correct. However, that is not the end of the inquiry. Plaintiff argues that at the pleading stage he may plead alternative counts, and thus is not precluded from asserting a promissory estoppel claim in addition to a claim for breach of contract. This argument is well-taken. “[T]he modern practice allows that party to plead in the alternative and make inconsistent allegations.” (Mendoza v. Continental Sales Co. (2006) 140 Ca1.App.4th 1395, 1402; see also Crowley v. Karleman (1994) 8 Cal.4th 666, 691 [stating pleading alternative factual or legal theories is appropriate “when the pleading is in doubt as to which theory most accurately reflects the events and can be established by the evidence”].) Courts have specifically allowed a plaintiff to plead both promissory estoppel and breach of contract based on the same facts, even though the causes of action have conflicting elements. (Fleet v. Bank ofAmerica N.A. (2014) 229 Ca1.App.4th 1403, 1413.) Therefore, Plaintiff could allege “facts that could suppoxt a cause of action for promissory estoppel . . . in the event that [he] cannot establish a cause of action for breach of contract.” (Ibid) 10 ORDER RE: DEMURRER \DOOQONUIAUJN 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 In light of the above, the fact that Plaintiff also alléges a breach 0f contract is not a basis for sustaining the demurrer. 3. Injury Defendants argue Plaintiff fails to adequately plead the element of injury because the military has not yet determined whether he will obtain constructive credit. The party asserting the estoppel must plead he or she was injured by reliance on the promise. (US Ecology, Inc. v. State, supra, 129 Cal.App.4th at p. 901.) As discussed more thoroughly above, Plaintiff‘s alleged injury is that he spent three years taking unnecessary coursework and sacrificed growing his successful company while he was enrolled at Stanford. (FAC, 1N 7, 25, 27, 28.) Plaintiff specifically alleges that without Secretary Perry’s promise, he would not have taken these security-based classes and would have left Stanford. Therefore, Plaintiff adequately pleads the element of injury. 4. Statute of Frauds Defendants advance the same argument here with respect to the statute of frauds as they did relative to the first cause of action. Defendants assert the claim for promissory estoppel is barred by the statute 0f frauds because Plaintiff alleges it took him three years to complete the necessary coursework. For the reasons previously stated, the claim is not barred by the statute 0f frauds because the allegations do not clearly reflect that the necessary coursework could not have been completed in a less than a year. Therefore, the cause of action for promissory estoppel does not appear to be barred by the statute 0f frauds. 5. Conclusion Based on the foregoing, Defendants fail to present any persuasive argument as to why the demurrer t0 the second cause of action should be sustained. Accordingly, the demurrer t0 the second cause of action on the ground of failure to state sufficient facts t0 constitute a cause 0f action is OVERRULED. 11 ORDER RE: DEMURRER \OOO\IO\UI->UJNt-‘ NNNNNNNNNflH-tHHHb-Hp-IH OOQONUIAUJNHOOOOQOUI-PUJNt-‘O C. Third Cause of Action - Negligent Misrepresentation Defendants argue Plaintiff fails t0 plead a misrepresentation 0f prior or existing fact, the element of injury, and Secretary Perry’s authority to speak for Stanford. 1. Misrepresentation Defendants assert Plaintiff fails to plead the element of misrepresentation because the alleged promise was a representation regarding future events or actions. One element of a claim for negligent misrepresentation is “the misrepresentation 0f a past or existing material fact[.]” (Apollo Capital Fund LLC v. Roth Capital Partners, LLC (2007) 158 Cal.App.4th 226, 243.) A false promise t0 perform in the future cannot support a claim for negligent misrepresentation. (Tarmann v. State Farm Mut. Ins. C0. (1991) 2 Ca1.App.4th 153, 158-1 59.) Defendants’ position that the promise concerns future events or actions is well-taken. Plaintiff’s claim is predicated 0n Defendants’ promise t0 provide a letter 0f recommendation t0 help him obtain constructive credit for courses taken at Stanford. Plaintiff s arguments in opposition are unavailing. Plaintiff simply asserts he pleads Defendants made representations 0f fact because Stanford said it “would support his military career” and never “expressed . . . concern that Secretary Perry would not consider supporting his request.” (Opp., p. 13: lis. 8-10, emphasis added.) These statements do not qualify as representations 0f fact. Rather, the statement that Stanford would support Plaintiff’s military career is more akin to a statement that someone “would pay for . . . repairs” in the future, which is not a representation of present fact. (Tarmann v. State Farm Mut. Ins. C0., supra, 2 Cal.App.4th at p. 158, emphasis in original.) While Plaintiff provides a litany 0f law illustrating exceptions to the requirement of a representation 0f material fact, he does not advance any arguments showing how any such examples relate t0 the present circumstances. Accordingly, Plaintiff fails to plead the element of misrepresentation and the demurrer is thus sustainable. 12 ORDER RE: DEMURRER OOOOQQLh-RUJNp-t NNNNNNNNNp-t-At-At-A-Ar-a-uu-iwt-t OOVOLII-PUJNi-‘OOOOflmUl-PUJNH 2. Injury Defendants once again argue Plaintiff fails t0 allege he was injured as a result 0f their actions. An element of a claim for negligent misrepresentation is that the plaintiff suffered resulting damages, i.e. injury. (Hot Rods, LLC v. Northrop Grumman Systems Corporation (201 5) 242 Cal.App.4th 1166, 1185.) As discussed with respect to the first and second causes 0f action, Plaintiff adequately alleges he was injured due to Defendants’ representations that if he took extra security-based coursework, he would receive a letter of recommendation for constructive credit. As a result of this representation, Plaintiff allegedly invested more time in school to the detriment of his independent business. Accordingly, the demurrer is not sustainable on the basis he fails to plead the element of injury. 3. Authority Defendants assert Plaintiff fails to plead Secretary Perry had authority to make promises on Stanford’s behalf. Defendants advance the same exact argument with respect t0 the third cause of action as to the first cause of action. The Court is unaware 0f any legal authority supporting Defendants’ contention that Plaintiff must allege facts establishing Secretary Perry’s ostensible authority t0 make promises on Stanford’s behalf t0 support a negligent misrepresentation claim. Defendants only cite t0 cases concerning the heightened particularity requirement in fraud claims, which requires a plaintiff t0 plead facts showing an individual’s authority t0 speak on behalf of a corporation. (West v. JPMorgan Chase Bank, N.A. (2013) 214 Cal.App.4th 780, 793.) The purpose 0f the heightened pleading standard is “to give the defendant notice of definite charges which can be intelligently met, and to permit the court to determine whether, on the facts pleaded, there is any foundation, prima facie at least, for the charge of fraud.” (Apollo Capital Fund, LLC v. Roth Capital Partners, LLC (2007) 158 Ca1.App.4th 226, 240, citations and quotations omitted.) Defendants essentially argue authority must be pleaded in order to establish liability for a negligent misrepresentation claim, similar to the requirement to plead an agent’s authority to enter into a contract 0n a principal’s behalf. The argument is misguided as the requirement to 13 ORDER RE: DEMURRER \OOONQUl-bUJNv-n [\JNNNNNNNNp-Ap-Ap-Ap-Ap-‘p-Ap-Ap-Ap-Ao-A WQQMLWNHOCWflthWNHO plead authority in fraud cases exists t0 give notice t0 defendants, whereas here, Defendants address the issue of authority in the context of legally binding Stanford t0 Secretary Perry’s statements. Therefore, Defendants fail t0 substantiate their position that no cause 0f action has been stated due to the absence of allegations of authority. Even assuming Defendants’ argument is correct, for the reasons stated above, Plaintiff sufficiently alleges Secretary Perry’s authority to enter into contracts on behalf of Stanford. Plaintiff alleges ample facts suggesting Stanford held Secretary Perry out as one who could provide a letter of recommendation. Notably, Secretary Perry is allegedly the only individual who approves requests for constructive credit. (FAC, 11 17.) Secretary Perry’s ostensible authority is additionally strengthened by his title as Director of CISAC and director of the War College Fellows program at Stanford, which allows students at the War College to audit classes at Stanford for constructive credit. (Id. at 1] 16.) Therefore, Plaintiff pleads facts suggesting Secretary Perry had ostensible authority to act on Stanford’s behalf with respect to writing recommendations for constructive credit. 4. Conclusion For the reasons stated above, Defendants persuasively argue Plaintiff fails to plead the element of misrepresentation. Accordingly, the demurrer to the third cause of action on the ground of failure to state facts sufficient to constitute a cause of action is SUSTAINED with 10 days’ leave to amend. [#0217 WM/fl Mauree A. Folan Judge f the Superior Court 14 ORDER RE: DEMURRER SUPERIOR COURT OF CALIFORNIA COUNTY OF SANTA CLARA DOWNTOWN COURTHOUSE ' 191 NORTH FIRST STREET F ‘ L_E D SAN JOSE, CALIFORNIA 95113 CIVIL DIVISION 10H APR 20 A ||= 23 April 20, 201 7 chgxiéegfcwe ?%LARQ’A v z- mmmA 59%“ 3 eras, ”,ieapuw RE: Michael Hanneken vs The Board of Trustees of The Leland Stanford Junior University et al Case Number: 16CV300285 PROOF OF SERVICE Order Re: Demurrer to FAC was delivered to the parties listed below the above entitled case as set forth in the sworn declaration below. If you, a party represented by you, or a witness to be called on behalf of that party need an accommodation under the American with Disabilities Act, please contact the Court Administrator’s office at (408) 882-2700, or use the Court’s TDD line (408) 882-2690 or the Voice/TDD Catifomia Relay Service (800) 735-2922. DECLARATION OF SERVICE BY MAIL: | declare that | served this notice by enclosing a true copy in a sealed envelope, addressed to each person whose name is shown below, and by depositing the envelope with postage fully prepaid, in the United States Maii at San Jose, CA on April 20, 201 7. CLERK OF THE COURT, by Lorna Dela Cruz, Deputy. cc: James Paul Giacchetti 5O W San Fernando ST FL 10 San Jose CA 951 13 Andrew Dale Lanphere Four Embarcadero Center 22nd Floor SAN FRANCISCO CA 941 11 CW-9027 REV 12/08/16 PROOF OF SERVICE
