Wang v. Ehang Holdings Limited

• Court: District Court, N.D. California
• Decided: January 21, 2021
• Docket: 5:20-cv-00569
• Status: Unknown

Opinion

1 2 3 UNITED STATES DISTRICT COURT 4 NORTHERN DISTRICT OF CALIFORNIA 5 SAN JOSE DIVISION 6 7 GARY WANG, Case No. 20-cv-00569-BLF

8 Plaintiff, ORDER GRANTING IN PART AND 9 v. DENYING IN PART MOTION TO DISMISS 10 EHANG HOLDINGS LIMITED, et al.,

11 Defendants.

12 13 In this employment-related dispute, Plaintiff Gary Wang brings four claims against 14 Defendants EHang Holdings Limited (“EHang Holdings”), Guangzhou EHang Intelligent 15 Technology Co., LTD. (“EHang Intelligent Technology”), Huazhi Hu, Derrick Yifang Xiong, 16 Shang-wen Hsiao, and Richard Jian Liu (collectively, “Defendants”). Defendants have filed a 17 motion to dismiss Mr. Wang’s breach of contract, unpaid wages, and unfair competition claim 18 (“UCL”). See Mot., ECF 45. The Court DENIES this motion as to Mr. Wang’s breach of contract 19 and unpaid wages claims and GRANTS WITH LEAVE TO AMEND the motion as to Mr. 20 Wang’s unfair competition claim. 21 As a preliminary matter, Defendants’ argument that this Court lacks personal jurisdiction 22 fails because it has been waived. Defendants needed to raise this defense in their prior motion to 23 dismiss, but they did not do so. See American Ass’n of Naturopathic Physicians v. Hayhurst, 227 24 F.3d 1104, 1106 (9th Cir. 2000) (“[a] fundamental tenet of the Federal Rules of Civil Procedure is 25 that certain defenses under Fed. R. Civ. P. 12 must be raised at the first available opportunity or, if 26 they are not, they are forever waived.”). This defense has been waived. 27 The Court finds that Mr. Wang has adequately plead his breach of contract and unpaid 1 Wang has adequately plead that Ehang Intelligent Technology, as stated on his contract, is the 2 same company as Guangzhou EHang Intelligent Technology Co., Ltd. Am. Compl. ¶¶ 13-15, ECF 3 40. As to the unpaid wages claim under California Labor Code §§ 201, 203 et seq, Defendants’ 4 only argument is that Mr. Wang has failed to adequately allege that he was employed by EHang 5 Intelligent Technology. Mot. 13. Because the Court has found that Mr. Wang has adequately plead 6 this, the motion to dismiss the unpaid wages claim and breach of contract claim against EHang 7 Intelligent Technology is DENIED. 8 The Court also finds that Mr. Wang has adequately plead both claims against Defendant 9 EHang Holdings under an agency theory at this stage of the case. Am. Compl. ¶¶ 12, 19-22, 29. 10 When considering a motion to dismiss, the Court “accept[s] factual allegations in the complaint as 11 true and construe[s] the pleadings in the light most favorable to the nonmoving party.” Manzarek 12 v. St. Paul Fire & Marine Ins. Co., 519 F.3d 1025, 1031 (9th Cir. 2008). Here, Mr. Wang alleges 13 that he was assured by executives of EHang Holdings (who were also executives of EHang 14 Intelligent Technology) that the shares promised in the employment agreement were restricted 15 stock units in EHang Holdings. Accordingly, the motion to dismiss the unpaid wages claim and 16 breach of contract claim against EHang Holdings is DENIED. 17 The Court will GRANT Defendants’ motion to dismiss Mr. Wang’s UCL claim. Although 18 this order is not based on Defendants’ argument in their motion, the Court sua sponte requested 19 that parties address the Ninth Circuit’s recent ruling in Sonner v. Premier Nutrition Corp., 971 20 F.3d 834, 844 (9th Cir. 2020). See Order, ECF 52. In Sonner, the Ninth Circuit made it clear that a 21 plaintiff “must establish that [he] lacks an adequate remedy at law before securing equitable 22 restitution for past harm under the UCL.” Sonner, 971 F.3d at 844. Mr. Wang acknowledged that 23 he has not done that here, but he requests leave to amend. 24 Based on the foregoing the Court DENIES the motion to dismiss the breach of contract and 25 unpaid wages claims and GRANTS the motion to dismiss as to the UCL claim with leave to 26 amend. Mr. Wang must file an amended complaint, along with a redlined version, by February 4, 27 2021. 1 IT IS SO ORDERED. 2 3 || Dated: January 21, 2021 kom Lh ham tn) 4 ee BETH LABSON FREEMAN 5 United States District Judge 6 7 8 9 10 11 a 12

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