1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 SOUTHERN DISTRICT OF CALIFORNIA 10 11 TIBRIO LLC, a Delaware Limited Case No.: 3:25-cv-01068-GPC-JLB Liability Company, 12 ORDER: Plaintiff, 13 (1) GRANTING DEFENDANT’S v. REQUEST FOR JUDICIAL 14 NOTICE SBG MEDIA, INC, a Florida 15 (2) GRANTING THE MOTION TO Corporation; ANDREW “ANDY” DISMISS 16 GOLD, an individual, SBG MEDIA
ENTERPRISE, LLC, a Florida 17 [ECF No. 18] Limited Liability Company; SBG 18 MEDIA RESOURCES, LLC, a Florida Limited Liability Company, 19 and DOES 1-100, inclusive, 20 Defendant. 21
22 Defendant SBG Media Inc. and Defendant SBG Media Resources, LLC 23 (collectively, “Defendants”) have submitted before this Court a request for judicial notice 24 and a motion to dismiss Plaintiff’s complaint. ECF No. 18. The motion to dismiss has 25 been fully briefed. ECF Nos. 20, 26. The Court finds the matters suitable for decision on 26 the papers. 27 1 For the reasons below, the Court GRANTS Defendants’ motion to dismiss. 2 FACTUAL BACKGROUND 3 On January 23, 2015, ZeetoGroup, LLC entered into a Publisher Services 4 Agreement (“PSA”) with a SBG Media, Inc. ECF No. 5 (“FAC”) ¶ 25, Ex. 1. The PSA 5 indicates that it was signed by CEO Mel Gold. Id., Ex. 1. Under that agreement, 6 ZeetoGroup, LLC is labeled as the advertiser, while SBG Media, Inc. is the publisher. Id. 7 The PSA sets out that the publisher will distribute the advertiser’s content to generate 8 user engagement. Id. ¶ 25. In turn, the publisher would be paid according to performance. 9 Id. 10 As relevant, Section 8 of the PSA states that “[e]ach party represents and warrants 11 that…at all times, the Advertising Material (and its transmission) and its performance 12 hereunder shall comply with all applicable laws, rules, regulations, and ordinances…and 13 will not violate any applicable rights of any third party.” Id., Ex. 1. Further, Section 9 14 states that each party would indemnify each other from and against “any and all actions, 15 claims, demands, proceedings, liabilities, judgments, settlements, fines, penalties, costs, 16 and expenses…which: (i) arise solely or in part from the act(s) and or omission(s) of the 17 Indemnifying Party.” Id. 18 As alleged, ZeetoGroup, LLC became Plaintiff Tibrio, LLC (“Plaintiff”). Id. ¶ 24. 19 In mid-2024, the host of SBG Media, Inc.’s websites acquired a new provider, and during 20 the transition, the new company failed to transfer all necessary data. Id. ¶ 27. 21 Specifically, “some key information about where SBG’s e-mails were coming from was 22 missing, which violated relevant laws about being clear and transparent in online 23 advertising.” Id. As a result, claims against Plaintiff were filed, arguing Plaintiff had 24 25 26 27 1 failed to comply with transparent online advertising laws. Id.; ECF No. 20 (“Opp.”) at 3.1 2 To avoid unnecessary litigation costs, Plaintiff promptly settled those claims, incurring 3 $91,000 in settlement payments and $15,000 in attorneys’ fees. FAC ¶ 27. 4 Defendant SBG Media, Inc. is a Florida corporation and was incorporated on 5 December 30, 2020. ECF No. 18 (“Mot.”) at 3, Ex. 1. Defendant SBG Media, Inc. has 6 stated it is a holding company. Id. at 4. Defendant SBG Media Resources, LLC is also a 7 Florida corporation that was incorporated on December 30, 2020. Id. at 3, Ex. 2. This 8 defendant has stated it is a payroll company. Id. at 4. Mel Gold is not listed as an officer 9 or agent of either defendant. Id. at 3. 10 Plaintiff claims that Defendants SBG Media, Inc., SBG Media Enterprise, LLC, 11 and SBG Media Resources, LLC and their “alter-ego, Andy Gold [ ] were aware of the 12 claims against [Plaintiff], its duty to indemnify [Plaintiff], and that the matter had been 13 settled.” FAC ¶ 28. Plaintiff maintains that these four defendants “jointly and severally[] 14 agreed to reimburse [Plaintiff] for the costs incurred due to SBG’s lack of compliance 15 with relevant laws.” Id. Plaintiff has not received any payment from the named 16 defendants. Id. 17 PROCEDURAL HISTORY 18 On April 25, 2025, Plaintiff filed a complaint against Defendants SBG Media, Inc., 19 a New York corporation, Andrew (“Andy”) Gold, and Does 1-100 for breach of written 20 contract, breach of oral contract, breach of the covenant of good faith and fair dealing, 21 implied contractual indemnity, and negligence. ECF No. 1. On May 21, 2025, Plaintiff 22 filed their first amended complaint, replacing the New York SBG Media, Inc. with 23 Defendants SBG Media, Inc., SBG Media Resources, LLC, and SBG Media Enterprise, 24
25 26 1 Throughout the order, the pagination for docketed documents is derived from the numbering generated by the ECF system. 27 1 LLC—all of which are companies located in Florida. ECF No. 5. On July 15, 2025, 2 Defendant SBG Media Enterprise, LLC and Defendant Andy Gold answered the FAC. 3 ECF No. 12. In contrast and as relevant here, Defendants SBG Media, Inc. and SBG 4 Media Resources, LLC (collectively, “Defendants”) moved to dismiss the FAC for 5 failing to state a claim under Federal Rule of Civil Procedure 12(b)(6). Mot. at 5-10. 6 LEGAL STANDARD 7 Rule 12(b)(6) allows a court to dismiss a complaint for “failure to state a claim 8 upon which relief can be granted.” Fed. R. Civ. P. 12(b)(6). Dismissal under Rule 9 12(b)(6) is appropriate where the complaint lacks a cognizable legal theory or sufficient 10 facts to support a cognizable legal theory. Election Integrity Project Cal., Inc. v. Weber, 11 113 F.4th 1072, 1081 (9th Cir. 2024) (citing Navarro v. Block, 250 F.3d 729, 732 (9th 12 Cir. 2001)). To survive a motion to dismiss, the complaint must contain a “short and 13 plain statement showing that the pleader is entitled to relief,” Fed. R. Civ. P. 8(a)(2), 14 backed by sufficient facts that make the claim “plausible on its face.” Ashcroft v. Iqbal, 15 556 U.S. 662, 678, (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 547 16 (2007)). Plausibility requires “more than a sheer possibility that a defendant has acted 17 unlawfully.” Iqbal, 556 U.S. at 678. Rather, it requires enough factual content for the 18 court to “draw the reasonable inference that the defendant is liable for the misconduct 19 alleged.” Id. (citing Twombly, 550 U.S. at 556). In reviewing the plausibility of a 20 complaint, courts must “accept factual allegations in the complaint as true and construe 21 them in the light most favorable to the non-moving party.” Dent v. Nat'l Football 22 League, 968 F.3d 1126, 1130 (9th Cir. 2020). But courts do not accept as true allegations 23 that are merely conclusory, unwarranted deductions of fact, or unreasonable inferences. 24 Coronavirus Rep. v. Apple, Inc., 85 F.4th 948, 954 (9th Cir. 2023). Ultimately, the court 25 must be able to “draw the reasonable inference that the defendant is liable for the 26 misconduct alleged.” Iqbal, 556 U.S. at 663. 27 1 Where a motion to dismiss is granted, “leave to amend should be granted ‘unless 2 the court determines that the allegation of other facts consistent with the challenged 3 pleading could not possibly cure the deficiency.’” DeSoto v. Yellow Freight Sys., Inc., 4
Free access — add to your briefcase to read the full text and ask questions with AI
1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 SOUTHERN DISTRICT OF CALIFORNIA 10 11 TIBRIO LLC, a Delaware Limited Case No.: 3:25-cv-01068-GPC-JLB Liability Company, 12 ORDER: Plaintiff, 13 (1) GRANTING DEFENDANT’S v. REQUEST FOR JUDICIAL 14 NOTICE SBG MEDIA, INC, a Florida 15 (2) GRANTING THE MOTION TO Corporation; ANDREW “ANDY” DISMISS 16 GOLD, an individual, SBG MEDIA
ENTERPRISE, LLC, a Florida 17 [ECF No. 18] Limited Liability Company; SBG 18 MEDIA RESOURCES, LLC, a Florida Limited Liability Company, 19 and DOES 1-100, inclusive, 20 Defendant. 21
22 Defendant SBG Media Inc. and Defendant SBG Media Resources, LLC 23 (collectively, “Defendants”) have submitted before this Court a request for judicial notice 24 and a motion to dismiss Plaintiff’s complaint. ECF No. 18. The motion to dismiss has 25 been fully briefed. ECF Nos. 20, 26. The Court finds the matters suitable for decision on 26 the papers. 27 1 For the reasons below, the Court GRANTS Defendants’ motion to dismiss. 2 FACTUAL BACKGROUND 3 On January 23, 2015, ZeetoGroup, LLC entered into a Publisher Services 4 Agreement (“PSA”) with a SBG Media, Inc. ECF No. 5 (“FAC”) ¶ 25, Ex. 1. The PSA 5 indicates that it was signed by CEO Mel Gold. Id., Ex. 1. Under that agreement, 6 ZeetoGroup, LLC is labeled as the advertiser, while SBG Media, Inc. is the publisher. Id. 7 The PSA sets out that the publisher will distribute the advertiser’s content to generate 8 user engagement. Id. ¶ 25. In turn, the publisher would be paid according to performance. 9 Id. 10 As relevant, Section 8 of the PSA states that “[e]ach party represents and warrants 11 that…at all times, the Advertising Material (and its transmission) and its performance 12 hereunder shall comply with all applicable laws, rules, regulations, and ordinances…and 13 will not violate any applicable rights of any third party.” Id., Ex. 1. Further, Section 9 14 states that each party would indemnify each other from and against “any and all actions, 15 claims, demands, proceedings, liabilities, judgments, settlements, fines, penalties, costs, 16 and expenses…which: (i) arise solely or in part from the act(s) and or omission(s) of the 17 Indemnifying Party.” Id. 18 As alleged, ZeetoGroup, LLC became Plaintiff Tibrio, LLC (“Plaintiff”). Id. ¶ 24. 19 In mid-2024, the host of SBG Media, Inc.’s websites acquired a new provider, and during 20 the transition, the new company failed to transfer all necessary data. Id. ¶ 27. 21 Specifically, “some key information about where SBG’s e-mails were coming from was 22 missing, which violated relevant laws about being clear and transparent in online 23 advertising.” Id. As a result, claims against Plaintiff were filed, arguing Plaintiff had 24 25 26 27 1 failed to comply with transparent online advertising laws. Id.; ECF No. 20 (“Opp.”) at 3.1 2 To avoid unnecessary litigation costs, Plaintiff promptly settled those claims, incurring 3 $91,000 in settlement payments and $15,000 in attorneys’ fees. FAC ¶ 27. 4 Defendant SBG Media, Inc. is a Florida corporation and was incorporated on 5 December 30, 2020. ECF No. 18 (“Mot.”) at 3, Ex. 1. Defendant SBG Media, Inc. has 6 stated it is a holding company. Id. at 4. Defendant SBG Media Resources, LLC is also a 7 Florida corporation that was incorporated on December 30, 2020. Id. at 3, Ex. 2. This 8 defendant has stated it is a payroll company. Id. at 4. Mel Gold is not listed as an officer 9 or agent of either defendant. Id. at 3. 10 Plaintiff claims that Defendants SBG Media, Inc., SBG Media Enterprise, LLC, 11 and SBG Media Resources, LLC and their “alter-ego, Andy Gold [ ] were aware of the 12 claims against [Plaintiff], its duty to indemnify [Plaintiff], and that the matter had been 13 settled.” FAC ¶ 28. Plaintiff maintains that these four defendants “jointly and severally[] 14 agreed to reimburse [Plaintiff] for the costs incurred due to SBG’s lack of compliance 15 with relevant laws.” Id. Plaintiff has not received any payment from the named 16 defendants. Id. 17 PROCEDURAL HISTORY 18 On April 25, 2025, Plaintiff filed a complaint against Defendants SBG Media, Inc., 19 a New York corporation, Andrew (“Andy”) Gold, and Does 1-100 for breach of written 20 contract, breach of oral contract, breach of the covenant of good faith and fair dealing, 21 implied contractual indemnity, and negligence. ECF No. 1. On May 21, 2025, Plaintiff 22 filed their first amended complaint, replacing the New York SBG Media, Inc. with 23 Defendants SBG Media, Inc., SBG Media Resources, LLC, and SBG Media Enterprise, 24
25 26 1 Throughout the order, the pagination for docketed documents is derived from the numbering generated by the ECF system. 27 1 LLC—all of which are companies located in Florida. ECF No. 5. On July 15, 2025, 2 Defendant SBG Media Enterprise, LLC and Defendant Andy Gold answered the FAC. 3 ECF No. 12. In contrast and as relevant here, Defendants SBG Media, Inc. and SBG 4 Media Resources, LLC (collectively, “Defendants”) moved to dismiss the FAC for 5 failing to state a claim under Federal Rule of Civil Procedure 12(b)(6). Mot. at 5-10. 6 LEGAL STANDARD 7 Rule 12(b)(6) allows a court to dismiss a complaint for “failure to state a claim 8 upon which relief can be granted.” Fed. R. Civ. P. 12(b)(6). Dismissal under Rule 9 12(b)(6) is appropriate where the complaint lacks a cognizable legal theory or sufficient 10 facts to support a cognizable legal theory. Election Integrity Project Cal., Inc. v. Weber, 11 113 F.4th 1072, 1081 (9th Cir. 2024) (citing Navarro v. Block, 250 F.3d 729, 732 (9th 12 Cir. 2001)). To survive a motion to dismiss, the complaint must contain a “short and 13 plain statement showing that the pleader is entitled to relief,” Fed. R. Civ. P. 8(a)(2), 14 backed by sufficient facts that make the claim “plausible on its face.” Ashcroft v. Iqbal, 15 556 U.S. 662, 678, (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 547 16 (2007)). Plausibility requires “more than a sheer possibility that a defendant has acted 17 unlawfully.” Iqbal, 556 U.S. at 678. Rather, it requires enough factual content for the 18 court to “draw the reasonable inference that the defendant is liable for the misconduct 19 alleged.” Id. (citing Twombly, 550 U.S. at 556). In reviewing the plausibility of a 20 complaint, courts must “accept factual allegations in the complaint as true and construe 21 them in the light most favorable to the non-moving party.” Dent v. Nat'l Football 22 League, 968 F.3d 1126, 1130 (9th Cir. 2020). But courts do not accept as true allegations 23 that are merely conclusory, unwarranted deductions of fact, or unreasonable inferences. 24 Coronavirus Rep. v. Apple, Inc., 85 F.4th 948, 954 (9th Cir. 2023). Ultimately, the court 25 must be able to “draw the reasonable inference that the defendant is liable for the 26 misconduct alleged.” Iqbal, 556 U.S. at 663. 27 1 Where a motion to dismiss is granted, “leave to amend should be granted ‘unless 2 the court determines that the allegation of other facts consistent with the challenged 3 pleading could not possibly cure the deficiency.’” DeSoto v. Yellow Freight Sys., Inc., 4 957 F.2d 655, 658 (9th Cir. 1992) (quoting Schreiber Distrib. Co. v. Serv-Well Furniture 5 Co., 806 F.2d 1393, 1401 (9th Cir. 1986)). 6 REQUEST FOR JUDICIAL NOTICE 7 Generally, on a motion to dismiss, courts will limit their review to the contents of 8 the complaint and may only consider extrinsic evidence that is properly presented as part 9 of the complaint. See Lee v. City of L.A., 250 F.3d 668, 688-89 (9th Cir. 2001). 10 However, under Federal Rule of Evidence 201, a district court may take notice of facts 11 not subject to reasonable dispute that are capable of accurate and ready determination by 12 resort to sources whose accuracy cannot reasonably be questioned. Fed. R. Evid. 201(b). 13 Defendants ask the Court to take judicial notice of (1) the articles of organization 14 for SBG Media Resources, LLC, ECF Doc. 18-1, Ex. 1, and (2) the articles of 15 organization for SBG Media Inc, ECF Doc. 18-1, Ex. 2. ECF No. 18-1. Plaintiff does not 16 oppose the request for judicial notice. Exhibit 1 and 2 are relevant to the instant case and 17 are matters of public record, so the Court may take judicial notice of them “without 18 converting a motion to dismiss into a motion for summary judgment.” Lee, 250 F.3d at 19 689 (quotations and citations omitted). 20 DISCUSSION 21 Defendants move to dismiss, arguing that the FAC fails to establish a contract with 22 or link to the two Defendants and, thus, fails to state a claim on all causes of action. See 23 Mot. at 5-10. In particular, the two Defendants argue that (1) Plaintiff cannot establish the 24 existence of a written or oral contract with Defendants and (2) Defendants do not owe a 25 duty of care to Plaintiff. Id. 26 / / / 27 1 I. CONTRACTS BETWEEN THE PARTIES 2 Under California law, “[i]t is essential to the existence of a contract that there 3 should be: (1) [p]arties capable of contracting; (2) [t]heir consent; (3) [a] lawful object; 4 and, (4) [a] sufficient cause or consideration.” Cal. Civ. Code § 1550. In addition, “[i]t is 5 essential to the validity of a contract, not only that the parties should exist, but that it 6 should be possible to identify them.” Cal. Civ. Code § 1558. The complaint must allege 7 facts that establish the elements of contract formation. Kuhn v. Three Bell Cap., 698 F. 8 Supp. 3d 1119, 1124 (N.D. Cal. 2023). A pleading that only offers “labels and 9 conclusions…[or] tenders naked assertions devoid of further factual enhancement” will 10 not suffice. Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (cleaned up). 11 Each of the FAC’s first four causes of action—breach of written contract (Cause 12 1), breach of oral contract (Cause 2), breach of the covenant of good faith and fair dealing 13 (Cause 3), and implied contractual indemnity (Cause 4)—requires the existence of a 14 contract between the parties to be sufficiently plead. Defendants first argue that Plaintiff 15 has failed to establish that the two Defendants and Plaintiff were party to the written 16 contract. Mot. at 6-7. Second, Defendants argue that Plaintiff failed to sufficiently 17 identify the terms of the alleged oral agreement to establish its existence. Id. at 7-8. 18 A. Written Contract: Parties to the Contract 19 California law does not require the use of full legal names in the contract, but it 20 must “be possible for a reasonable [individual] to identify the parties to the contract.” 21 Oberstein v. Live Nation Ent., Inc., 60 F.4th 505, 511 (9th Cir. 2023). A defendant will 22 not be bound to a contract if they are not identifiably a party to that contract. See Cal. 23 Civ. Code § 1558; Jackson v. Grant, 890 F.2d 118, 121 (9th Cir. 1989). 24 First, as pointed out by Defendants, the Plaintiff Tibrio is not adequately identified 25 as a party to the contract here. See Mot. at 6. The written contract in this case identifies 26 ZeetoGroup, LLC as a party and does not name Tibrio. In its amended complaint, 27 1 Plaintiff summarily alleges that “ZeetoGroup, LLC then later [became] Plaintiff Tibrio.” 2 FAC ¶ 24. No further facts are supplied by Plaintiff to establish the link between itself 3 and ZeetoGroup, LLC. As Plaintiff Tibrio is not a named party to the contract, it must 4 provide more to reasonably identify how ZeetoGroup “became” Tibrio, such as supplying 5 details on how and when the acquisition, change or assignment was made. 6 In addition, the PSA does not reasonably identify Defendants. On one hand, the 7 contract identifies ZeetoGroup, LLC as the “Advertiser,” listing its status as a “Delaware 8 limited liability company” and its address. FAC, Ex. 1. On the other, the same level of 9 detail is not provided for the SBG Media, Inc. that has signed the PSA. Specifically, 10 information about its address and its company type are left blank. Id. 11 Looking at each Defendant individually reveals the lack of adequate identification. 12 One, Defendant SBG Media Resources, LLC was not even a named party or signatory to 13 the written contract. Id. Two, the contract was signed in 2015 by Mel Gold as CEO of 14 SBG Media, Inc. Id. Meanwhile, Defendant SBG Media Resources, LLC was not 15 organized as a corporate entity until 2020, and Mel Gold is not listed as an officer or 16 agent of the company. ECF No. 18-1, Ex. 1; Mot. at 3. Thus, Plaintiff has failed to 17 reasonably identify SBG Media Resources, LLC as a party to the subject contract. 18 Next, Defendant SBG Media, Inc. is similarly not reasonably identifiable. 19 Defendant SBG Media, Inc. does have the same name as the signatory in the written 20 contract, which provides some support towards identifiability. FAC, Ex. 1. Nonetheless, 21 like Defendant SBG Media Resources, LLC, Defendant SBG Media, Inc., a Florida LLC 22 was not incorporated until 2020. ECF No. 18-1, Ex. 2. It also does not list Mel Gold as an 23 officer or agent of the company. Mot. at 3. To sufficiently identify each of the two 24 Defendants, Plaintiff must supply more facts, establishing how each Defendant is linked 25 to the contract, accounting for the contract language, incorporation information, and 26 organization dates. 27 1 In its opposition, Plaintiff counters by alleging a conspiracy between all named 2 Defendants and points back to the FAC’s alter ego allegations, which states that 3 Defendants Gold and Does 1-100 controlled the affairs of all named Defendant 4 companies to such an extent that “the individuality and separateness of each and all of the 5 Defendants ceased to and in fact never did exist.” FAC ¶ 13. The Plaintiff maintains that 6 “[t]he fact that [Defendants] claim SBG Media, Inc. the entity that executed the PSA, was 7 not a party to the PSA, indicates that the entities are inextricably intertwined.” Opp. at 7. 8 Lastly, to support its argument that named Defendants worked in concert, the Plaintiffs 9 maintain that all SBG Defendants have the same insurer and “that there appears to have 10 been an assignment of the PSA.” Id. at 8. Each of these arguments is unavailing. 11 As a starting point, this allegation of conspiracy goes beyond the claims made in 12 the FAC. A Court may not consider new conspiracy allegation made in the Plaintiff’s 13 opposition to evaluate the sufficiency of the Plaintiff’s claims. Schneider v. Cal. Dep't of 14 Corr., 151 F.3d 1194, 1197 n. 1 (9th Cir. 1998) (concluding that new allegations in 15 opposition were irrelevant for Rule 12(b)(6) purposes and that “court may not look 16 beyond the complaint ... such as a memorandum in opposition to a defendant's motion to 17 dismiss”). 18 Further, the alter ego allegations present in the FAC do not allege a link between 19 Defendants SBG Media, Inc., SBG Media Enterprise, LLC, and SBG Media Resources, 20 LLC but instead claim that Defendants Gold and Does 1-100 “used the Entities as a 21 conduit to conduct their personal business, property, and affairs as a device to avoid 22 individual liability.” FAC ¶ 14. The crux of the Plaintiff’s alter ego allegations is that the 23 Plaintiff believes Defendants Gold and Does 1-100 should be held individually liable as 24 alter egos of the corporate entities, not that the corporate entities were acting in concert. 25 Id. ¶ 14, 17. 26 27 1 Finally, the FAC makes no reference to a possible assignment of the PSA and, like 2 the conspiracy claims in the opposition, the Court cannot give these newly made 3 assertions any weight in deciding the motion to dismiss. 4 For the reasons explained above, neither the Plaintiff nor moving Defendants are 5 identifiable parties. As such, Plaintiff has failed to sufficiently allege that Defendants are 6 bound to the PSA. Defendants, thus, cannot be bound to the PSA. 7 B. Oral Contract: Sufficiently Definite Terms & Consideration 8 For the existence of a contract to be sufficiently alleged, a plaintiff must plead (1) 9 mutual assent, (2) sufficiently definite contractual terms, and (3) consideration. 10 Rockridge Tr. v. Wells Fargo, N.A., 985 F. Supp. 2d 1110, 1142 (N.D. Cal. 2013). Under 11 California law, terms are sufficiently definite if the Court is able “to ascertain the parties' 12 obligations and to determine whether those obligations have been performed or 13 breached.” Ersa Grae Corp. v. Fluor Corp., 1 Cal. App. 4th 613, 623 (1991). However, 14 “a contract is void and unenforceable where a contract is so uncertain and indefinite that 15 the intention of the parties on material questions cannot be ascertained.” Rockridge, 985 16 F. Supp. 2d at 1142. 17 Plaintiff’s oral contract claim provides few details, such as who was present at the 18 oral exchange and in what capacity oral promises were made and when the exchange took 19 place. Instead, Plaintiff relies on the conclusory allegation that “SBG and Gold, jointly 20 and severally, agreed to reimburse [Plaintiff] for the costs incurred due to SBG’s lack of 21 compliance with relevant laws,” specifically in the amount of $91,000 in settled claims 22 and $15,000 in attorneys’ fees. FAC ¶¶ 27-28. Notwithstanding the deficiencies noted, 23 the claim alleges mutual assent between the parties, stating that both parties knew of the 24 noncompliance claims and came to an agreement. It also provides adequate terms. The 25 claim sets out the amount allegedly owed by Defendants because of their legal 26 noncompliance and that the Plaintiff efficiently handled the claims in Defendants’ place, 27 1 which determined the amount. Id. ¶ 28. Based on these terms, the Court can ascertain the 2 Parties’ obligations and their alleged breach. See Ersa Grae Corp. v. Fluor Corp., 1 Cal. 3 App. 4th 613, 623 (1991). 4 As for the third requirement, consideration is “present when the promisee confers a 5 benefit or suffers a prejudice.” Prop. California SCJLW One Corp. v. Leamy, 25 Cal. 6 App. 5th 1155, 1165 (2018); Cal. Civ. Code § 1606. The benefit or detriment “must 7 actually be bargained for as the exchange for the promise…[or p]ut another way, the 8 benefit or prejudice must have induced the promisor's promise.” Steiner v. Thexton, 48 9 Cal. 4th 411, 421 (2010) (cleaned up). Past consideration—a past benefit or detriment 10 that has been supplied before the promise is made—does not support a contract. See 11 Passante v. McWilliam, 53 Cal. App. 4th 1240, 1247 (1997). Similarly, a “promise to 12 perform a preexisting legal duty is not supported by consideration.” See US Ecology, Inc. 13 v. State of California, 92 Cal. App. 4th 113, 129 (2001). 14 Here, consideration has not been established. First, Plaintiff had alleged that the 15 written contract created a duty of indemnification. FAC ¶ 28. However, if the existence 16 of the written contract had been sufficiently pled above, it is unclear how the pre-existing 17 duty rule would not apply, leading to the conclusion that the oral contract lacks 18 consideration. Given the written contract was not established, there also are no facts 19 alleged by Plaintiff that show a bargained-for exchange or how Plaintiff’s conferred 20 benefit would have induced the two Defendants to make the promise. In fact, the 21 benefit—promptly settling claims and covering related costs—appears to have been 22 conferred by Plaintiff before the alleged promise to indemnify was made. See id. This 23 constitutes past consideration and is insufficient to support a new promise or contract. 24 C. Effect on Causes of Action 25 As seen above, Plaintiff has failed to adequately plead that an oral or written 26 contract exists between Plaintiff and Defendants. Thus, because causes of action 1-4 27 1 require the existence of a contract, Plaintiffs have failed to state a claim on those four 2 causes of action. 3 II. NEGLIGENCE: DUTY OF CARE 4 Under California law, a negligence claim must establish a duty of care, a breach of 5 that duty, causation, and injury. Vasilenko v. Grace Family Church, 3 Cal. 5th 1077, 6 1083 (2017). “A duty exists only if the plaintiff's interests are entitled to legal protection 7 against the defendant's conduct.” Sheen v. Wells Fargo Bank, N.A., 12 Cal. 5th 905, 920 8 (2022) (quotation marks omitted). “The legal duty of care may be of two general types: 9 (a) the duty of a person to use ordinary care in activities from which harm might 10 reasonably be anticipated, or (b) an affirmative duty where the person occupies a 11 particular relationship to others.” McGettigan v. Bay Area Rapid Transit Dist., 57 12 Cal.App.4th 1011, 1016–1017 (1997). “The existence of a legal duty to use reasonable 13 care in a particular factual situation is a question of law for the court to decide.” Vasquez 14 v. Residential Invs., Inc., 118 Cal.App.4th 269, 278 (2004). 15 Defendants have maintained that Plaintiff’s negligence claim fails as a matter of 16 law because Defendants do not owe Plaintiff a duty of care. Mot. at 9. In particular, 17 Defendants have not “performed any work or had any connection to Plaintiff or its 18 business” that would create a legal duty. Id. 19 The Court agrees. As discussed above, Plaintiff has not established that these two 20 Defendants have either an oral or written contract with Plaintiff. Given there is no link 21 between the Defendants and Plaintiff, there are no activities between the parties that 22 would warrant Defendants to exercise care. Thus, Plaintiffs have failed to state a claim on 23 the negligence cause of action. 24 / / / 25 / / / 26 / / / 27 1 CONCLUSION 2 For the foregoing reasons, the Court GRANTS the Defendant’s motion to dismiss 3 complaint with leave to amend. Plaintiff shall file an amended complaint within 21 4 || days of the Court’s Order. The hearing set on October 31, 2025 shall be VACATED. 5 IT IS SO ORDERED. 6 Dated: October 20, 2025 <=
8 United States District Judge 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 12 28 3:25-cv-01068-GPC-JLB