Osborne v. Yasmeh

Filed 7/28/16

CERTIFIED FOR PARTIAL PUBLICATION*

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

SECOND APPELLATE DISTRICT

DIVISION FOUR

REBECCA OSBORNE, B262043

Plaintiff and Appellant, (Super. Ct. No. BC527112)

Los Angeles County

v.

BRUCE YASMEH et al.,

Defendants and Respondents.

KODY MESSMER et al., B265530

Plaintiffs and Appellants, (Super. Ct. No. BC553653)

Los Angeles County

v.

BRUCE YASMEH et al.,

Defendants and Respondents.

APPEAL from judgments of the Superior Court of Los Angeles County, Richard

L. Fruin and William F. Fahey, Judges. Reversed and remanded with directions.

Glenn A. Murphy for Plaintiffs and Appellants.

Courtney M. Coates for Defendants and Respondents.

*

Pursuant to California Rules of Court, rules 8.1100 and 8.1110, this opinion is

certified for publication with the exception of parts B. and C. in the Discussion section.

INTRODUCTION

Plaintiffs John Flowers, Rebecca Osborne, Seth Messmer, and Kody Messmer

(collectively, plaintiffs) allege that they visited a hotel owned and managed by defendants

Bruce Yasmeh, Alfred Yasmeh, American Property Management, and INE Capital

Holdings.1 Flowers is paraplegic and employs the use of a service dog. Osborne is

Flowers’s wife, and the Messmers are Flowers’s stepsons. Plaintiffs allege that they

visited defendants’ hotel, but management refused to rent them a room unless they first

paid a non-refundable cleaning fee relating to the dog. They allege that the charge for the

room was $80, and the nonrefundable cleaning fee was $300. Plaintiffs left the hotel

without paying the fee or checking in as guests.

Plaintiffs sued defendants in two separate lawsuits, one brought by Osborne and

one brought by Flowers and the Messmers. In both actions, plaintiffs alleged violations

of the Unruh Civil Rights Act (Civil Code, § 512) and intentional infliction of emotional

distress. Defendants argued that plaintiffs’ pleadings could not establish standing due to

a “bright-line rule” articulated in Surrey v. True Beginnings (2008) 168 Cal.App.4th 414,

416 (Surrey), that under the Unruh Act, “a person must tender the purchase price for a

business’s services or products in order to have standing to sue it for alleged

discriminatory practices relating thereto.” Because plaintiffs left the hotel without paying

the fee, defendants argued, they did not have standing to assert an Unruh Act cause of

action. The trial court sustained defendants’ demurrers without leave to amend.

Plaintiffs appealed from the judgments entered in their two separate cases. We

consolidated the cases for purposes of oral argument and decision.

While we agree with the result in Surrey, we find that its bright-line rule is not

applicable to the facts of this case. Section 52, which provides remedies for violations of

the Unruh Act, states that any person aggrieved by conduct that violates the Unruh Act

may bring a civil action. (§ 52, subd. (c).) When a disabled person such as Flowers

1

Defendant INE Capital Holdings is not listed as a defendant in the

Flowers/Messmer complaint.

2

All further statutory references are to the Civil Code unless otherwise indicated.

2

alleges that he presented himself to a business establishment and was required to pay a

fee relating to his disability before accessing the products or services offered, he has

stated facts sufficient to establish that he is a person aggrieved as defined in section 52,

subdivision (c), and he has therefore alleged facts sufficient to demonstrate standing to

sue under the Unruh Act. A plaintiff is not required to pay a discriminatory fee to

establish standing to sue under the Unruh Act, as long as the plaintiff alleges facts

showing that he or she has directly experienced a denial of rights as defined in sections

51 and 52. In addition, when a disabled individual has standing to sue under section 52,

subdivision (c), any person “associated with” that individual (§ 51.5, subd. (a)) has

standing if the associated person has also directly experienced the discriminatory

conduct. We therefore reverse the judgments below and remand for further proceedings.

FACTUAL AND PROCEDURAL BACKGROUND

Plaintiff Rebecca Osborne3 filed her complaint on November 8, 2013, alleging a

violation of the Unruh Act and section 51.5.4 Osborne alleged that in July 2013, she was

“associated with a disabled person who uses an assistance animal to manage a disability,”

and that she was denied accommodation at defendants’ hotel as a result. She alleged,

“Defendants insisted the lodging offered to the general public could not be offered to

Plaintiff unless a non-refundable cleaning fee deposit of $300 was paid, in addition to the

regular room fee of approximately $80 normally charged to all other members of the

general public, since Plaintiff was associated with and was using an assistance animal.”

Osborne sought injunctive relief, a $4,000 statutory penalty (§ 52, subd. (a)), and attorney

fees. Osborne’s case was assigned to superior court Department 15, before Judge

Richard Fruin.

In July 2014, shortly before trial, defendants moved for judgment on the

pleadings. Defendants argued that according to the rule articulated in Surrey, supra,

3

Osborne is listed as “Becky Ozborn” in the complaint. Plaintiffs explained that

the use of Osborne’s nickname and the misspelling of her last name was erroneous.

4

Section 51.5, subdivision (a) states that “[n]o business establishment of any kind

whatsoever shall discriminate against . . . any person . . . because the person is associated

with a person who has, or is perceived to have” a disability.

3

where a plaintiff alleges a defendant charged a discriminatory fee, the plaintiff must

“tender the purchase price for a business’s services or products” in order to establish

standing under the Unruh Act. Because Osborne did not allege that she paid the fee and

rented a hotel room, defendants argued, she did not establish standing.

Before defendants’ motion was heard, plaintiffs Flowers and the Messmers filed a

complaint on August 4, 2014. Like Osborne, Flowers and the Messmers alleged that they

visited defendants’ hotel in July 2013. They alleged that Flowers was refused a room

because he was a disabled person who used a licensed service dog, and the Messmers

were refused a room for being associated with Flowers. They alleged that “Defendants

insisted the lodging offered to the general public could not be offered to Plaintiff unless a

non-refundable cleaning fee deposit of $300 was paid, in addition to the regular room fee

of approximately $80 normally charged to all other members of the general public.”

Flowers and the Messmers asserted a cause of action for violation of the Unruh Act and

section 51.5, and a cause of action for intentional infliction of emotional distress.

When they filed their complaint, Flowers and the Messmers also filed a notice of

related cases, alerting the superior court to the pending Osborne case. For reasons

unclear to us, the trial court deemed the cases not related,5 and the Flowers/Messmer case

was assigned to superior court department 69 before Judge William F. Fahey.

In Osborne’s case, Judge Fruin granted defendants’ motion for judgment on the

pleadings in August 2014. Judge Fruin held that under Surrey, Osborne was required to

allege that she paid the fee to establish standing. The court granted Osborne leave to

amend her complaint.

5

“A pending civil case is related to another pending civil case . . . if the cases: (1)

Involve the same parties and are based on the same or similar claims; (2) Arise from the

same or substantially identical transactions, incidents, or events requiring the

determination of the same or substantially identical questions of law or fact; (3) Involve

claims against, title to, possession of, or damages to the same property; or (4) Are likely

for other reasons to require substantial duplication of judicial resources if heard by

different judges.” (Cal. Rules of Court, rule 3.300.)

4

Osborne filed a first amended complaint on August 18, 2014. She added an

allegation that “Plaintiff, through a family member, offered to pay the deposit, but it was

refused since the hotel did not want a dog in the hotel and the hotel manager claimed the

hotel had a right of refusal.” She also alleged that “Defendant’s managing agent was

told, and clearly understood since it was obvious, that the husband of Plaintiff was

disabled in a wheelchair and had with him a service dog to assist in managing his

disability.” Osborne also alleged that they were refused service not only because of the

cleaning fee, but also because no dogs were allowed at the hotel. She alleged that

defendants’ managing agent “spoke loud enough so that the other guests could clearly

hear and understand that Plaintiffs [sic] were being ejected, and this conduct was

intentionally done to embarrass and publicly humiliate Plaintiffs and their family. . . .”

She added that the “supposed requirement for a deposit was a trick and subterfuge and

used by Defendants as a way of refusing a room to Plaintiff and getting her and her

family to leave with the dog.” Osborne alleged a cause of action for violation of the

Unruh Act and section 51.5, and added a cause of action for intentional infliction of

emotional distress, incorporating the allegations from the Unruh Act cause of action.

Defendants moved for summary judgment and demurred to Osborne’s first

amended complaint. Because the motion for summary judgment was deemed moot when

the trial court sustained defendants’ demurrer without leave to amend, we focus on the

demurrer. In their demurrer, defendants again argued that Osborne lacked standing due

to the Surrey rule that a plaintiff must pay the allegedly discriminatory fee to establish

standing under the Unruh Act, and the expanded allegation that a family member

attempted to pay the fee was insufficient to meet this requirement. Defendants also

argued that the first amended complaint was a sham pleading. They argued that Osborne

changed her allegations, maintaining in the amended complaint that defendants refused to

provide her with a hotel room not because of the cleaning fee, as previously alleged, but

simply because they did not want dogs in the hotel. Referencing Osborne’s deposition

testimony, discovery responses, and other documents, defendants argued that Osborne

made clear that she never attempted to pay the alleged additional fee, and the amended

5

complaint therefore “directly contradicts judicial admissions made in the original

complaint, deposition testimony, and prior sworn admissions.” Osborne opposed the

demurrer.

On December 5, 2014, Judge Fruin sustained defendants’ demurrer to Osborne’s

amended complaint without leave to amend. The court held that Osborne’s new

allegations did not cure the defect in the original complaint, because Surrey requires a

plaintiff to pay the discriminatory fee to establish standing. The court considered

Osborne’s previous complaint and statements in her deposition that the family was

refused accommodation at the hotel because of the cleaning fee, and contrasted these

allegations with her allegations in the first amended complaint that the hotel simply did

not want dogs in the hotel. The court also held that because Osborne’s allegations and

statements in discovery focused on the fee rather than an outright refusal to allow dogs,

the new factual allegations in the first amended complaint were “clearly sham pleading.”

The court did not address Osborne’s cause of action for intentional infliction of emotional

distress.

A week later, on December 12, 2014, defendants demurred to the

Flowers/Messmer complaint.6 Defendants argued that plaintiffs did not have standing

under the Unruh Act pursuant to Surrey. In addition, defendants requested judicial notice

of court documents and evidence from the Osborne case and other cases filed by

plaintiffs’ counsel, and argued that the doctrine of res judicata barred plaintiffs from

asserting their claims against defendants. Defendants also argued that the cause of action

for intentional infliction of emotional distress was derivative of the Unruh Act cause of

action, and therefore was meritless. Flowers and the Messmers opposed the demurrer

and request for judicial notice, arguing that payment of the fee was irrelevant because this

was not a discriminatory pricing case, and the trial court’s order in Osborne was not

precedential. Judge Fahey sustained the demurrer, stating only, “The demurrer is well-

6

There is no explanation in the record for the unconventional timing of the

demurrer, and plaintiffs did not argue that the demurrer was untimely. (Code Civ. Proc.,

§ 430.40, subd. (a).)

6

taken and sustained. Because neither the opposition nor counsel at the hearing proffered

new facts to overcome the demurrer, leave to amend is not granted.” The order did not

state whether the court took judicial notice of the documents submitted by defendants.

Judgment was entered following each demurrer order. Plaintiffs timely appealed

each judgment. On our own motion, we consolidated the cases for purposes of oral

argument and decision.

STANDARD OF REVIEW

“We independently review the sustaining of a demurrer and determine de novo

whether the complaint alleges facts sufficient to state a cause of action or discloses a

complete defense.” (Valbuena v. Ocwen Loan Servicing, LLC (2015) 237 Cal.App.4th

1267, 1271.) “‘We treat the demurrer as admitting all material facts properly pleaded,

but not contentions, deductions or conclusions of fact or law. [Citation.] We also

consider matters which may be judicially noticed.’ (Serrano v. Priest (1971) 5 Cal.3d

584, 591, [96 Cal.Rptr. 601, 487 P.2d 1241].)” (Blank v. Kirwan (1985) 39 Cal.3d 311,

318.) Where a plaintiff has standing to bring the action, and each count in the complaint

sufficiently states a cause of action, a general demurrer should be overruled. (TracFone

Wireless, Inc. v. County of Los Angeles (2008) 163 Cal.App.4th 1359, 1368.)

“As a general principle, standing to invoke the judicial process requires an actual

justiciable controversy as to which the complainant has a real interest in the ultimate

adjudication because he or she has either suffered or is about to suffer an injury of

sufficient magnitude reasonably to assure that all of the relevant facts and issues will be

adequately presented to the adjudicator.” (Holmes v. California Nat. Guard (2001) 90

Cal.App.4th 297, 314-315.) “The prerequisites for standing to assert statutorily based

causes of action are determined from the statutory language, as well as the underlying

legislative intent and the purpose of the statute.” (Boorstein v. CBS Interactive, Inc.

(2013) 222 Cal.App.4th 456, 466.)

7

DISCUSSION

A. Plaintiffs have established standing under the Unruh Act in both

actions

The Unruh Act states, “All persons within the jurisdiction of this state are free and

equal, and no matter what their sex, race, color, religion, ancestry, national origin,

disability, medical condition, genetic information, marital status, sexual orientation,

citizenship, primary language, or immigration status are entitled to the full and equal

accommodations, advantages, facilities, privileges, or services in all business

establishments of every kind whatsoever.” (§ 51, subd. (b).)

In California, “[t]wo overlapping laws, the Unruh Civil Rights Act (§ 51) and the

Disabled Persons Act (§§ 54-55.3), are the principal sources of state disability access

protection.” (Jankey v. Lee (2012) 55 Cal.4th 1038, 1044 (Jankey).)7 “The Unruh Civil

Rights Act broadly outlaws arbitrary discrimination in public accommodations and

includes disability as one among many prohibited bases. (§ 51, subd. (b).) As part of the

1992 reformation of state disability law, the Legislature amended the Unruh Civil Rights

Act to incorporate by reference the ADA [the Americans with Disabilities Act of 1990],

making violations of the ADA per se violations of the Unruh Civil Rights Act. (§ 51,

subd. (f); Munson v. Del Taco, Inc., supra, 46 Cal.4th at pp. 668-669.) This amendment

was intended to extend to disabled individuals aggrieved by an ADA violation the full

panoply of Unruh Civil Rights Act remedies. (Munson, at p. 673.) These include

injunctive relief, actual damages (and in some cases as much as treble damages), and a

minimum statutory award of $4,000 per violation. (§ 52, subds. (a), (c)(3); Turner v.

Association of American Medical Colleges (2011) 193 Cal.App.4th 1047, 1058, [123

Cal.Rptr.3d 395].)” (Jankey, supra, 55 Cal.4th at p. 1044.) “The Act is to be given a

liberal construction with a view to effectuating its purposes.” (Koire v. Metro Car Wash

(1985) 40 Cal.3d 24, 28 (Koire).)

7

“Part 2.5 of division 1 of the Civil Code, currently consisting of sections 54 to

55.3, is commonly referred to as the ‘Disabled Persons Act,’ although it has no official

title.” (Munson v. Del Taco, Inc. (2009) 46 Cal.4th 661, 674 fn. 8 (Munson).)

8

Section 51.5, while not technically part of the Unruh Act (Semler v. General Elec.

Capital Corp. (2011) 196 Cal.App.4th 1380, 1404), provides similar protections to those

“associated with” persons described in the Unruh Act: “No business establishment of

any kind whatsoever shall discriminate against . . . any person . . . because the person is

associated with a person who has, or is perceived to have” a disability. (§ 51.5, subd.

(a).)

Standing under the Unruh Act is broad. When “any person or group of persons is

engaged in conduct of resistance to the full enjoyment of any of the rights described in

this section . . . any person aggrieved by the conduct may bring a civil action . . . .” (§ 52,

subd. (c).) As the Supreme Court stated, “[A]n individual plaintiff has standing under the

[Unruh] Act if he or she has been the victim of the defendant’s discriminatory act.”

(Angelucci v. Century Supper Club (2007) 41 Cal.4th 160, 175 (Angelucci).) “The

prerequisites for standing to assert statutorily-based causes of action are to be determined

from the statutory language, as well as the underlying legislative intent and the purpose

of the statute.” (Surrey, supra, 168 Cal.App.4th at pp. 417-418.) “The focus of the

standing inquiry is on the plaintiff, not on the issues he or she seeks to have determined;

he or she must have a special interest that is greater than the interest of the public at large

and that is concrete and actual rather than conjectural or hypothetical.” (Id. at p. 418.)

The parties discuss the two principal cases that address standing under the Unruh

Act, Angelucci and Surrey. The Supreme Court in Angelucci primarily focused on what

constituted discrimination under the Unruh Act. In that case, male plaintiffs alleged they

visited a nightclub on several occasions and were charged admission fees higher than the

fees charged to women. (Angelucci, supra, 41 Cal.4th at p. 165.) The defendant argued

that because the plaintiffs never asked to be charged the same rates as women, they could

not recover under the Unruh Act. (Ibid.) The Supreme Court held that a plaintiff

instituting an Unruh Act lawsuit was not required to establish as a condition “that the

defendant[s] have been given notice and an opportunity to correct the asserted violation.”

(Id. at p. 168.) The court also briefly touched on standing in the opinion, stating,

“According to their allegations, each of the plaintiffs was subjected to, and paid,

9

defendant’s gender-based price differential. Accepting plaintiffs’ factual allegations as

true, as we are required to do in reviewing a judgment entered on the pleadings, plaintiffs

must be considered ‘person[s] denied the rights provided in Section 51.’ (§ 52(a).)” (Id.

at pp. 175-176.)

The Court of Appeal expanded on Angelucci in Surrey, supra, 168 Cal.App.4th

414. In that case, the plaintiff visited a matchmaking website with the intent of using its

services. (Id. at p. 416.) When he discovered that the website charged men for certain

services that were offered to women without charge, the plaintiff chose not to subscribe.

He sued the defendant alleging violations of the Unruh Act. (Ibid.) The trial court

granted summary judgment and the Court of Appeal affirmed, because the plaintiff never

subscribed to the website’s services and therefore never personally experienced any

discrimination. (Id. at pp. 418-419.) The court “adopt[ed] a bright-line rule that a person

must tender the purchase price for a business’s services or products in order to have

standing to sue it for alleged discriminatory practices relating thereto.” (Surrey, supra at

p. 416.) The reasoning in the Surrey opinion is discussed more fully below.

Defendants argue that under Angelucci and the bright-line rule articulated in

Surrey, plaintiffs did not establish standing under the Unruh Act: “Plaintiffs lack

standing to sue because they do not and cannot allege that they actually paid the alleged

discriminatory fee for the Defendants’ hotel room and registered as [ ] guest[s].” We

think this argument takes Surrey’s bright-line rule too far and contradicts California’s

established antidiscrimination case law.

California has long barred discrimination based on physical characteristics. Early

common law decisions created a duty to serve all customers on reasonable terms without

discrimination. (See In re Cox (1970) 3 Cal.3d 205, 212 (Cox).) “The California

Legislature, in 1897, enacted these common law doctrines into the statutory predecessor

of the present Unruh Civil Rights Act [also codified as Civil Code section 51]. (See

Klein, The California Equal Rights Statutes in Practice (1958) 10 Stan.L.Rev. 253, 255-

258.) The 1897 act provided: ‘That all citizens within the jurisdiction of this State shall

be entitled to the full and equal accommodations, advantages, facilities, privileges of

10

inns, restaurants, hotels, eating-houses, barber-shops, bath-houses, theaters, skating-rinks,

and all other places of public accommodation or amusement, subject only to the

conditions and limitations established by law and applicable alike to all citizens.’ (Stats.

1897, ch. 108, p. 137, § 1.) A 1919 amendment broadened the act to encompass public

conveyances. (Stats. 1919, ch. 210, p. 309, § 1.) In 1923 the Legislature extended the

act’s coverage to ‘places where ice cream or soft drinks of any kind are sold for

consumption on the premises.’ (Stats. 1923, ch. 235, p. 485, § 1.)” (Cox, supra, 3 Cal.3d

at p. 213.) Section 52 provided that anyone who denied the rights provided in section 51

was liable for damages. (Id. at p. 214, fn. 6.)

The application of section 51 has not historically turned on whether a plaintiff has

paid a fee, or, as Surrey stated, “tender[ed] the purchase price for a business’s services or

products.” In Hutson v. Owl Drug Co. (1926) 79 Cal.App. 390, for example, the

plaintiff, ‘“an American citizen and a negro,”’ went into the defendant’s business and sat

at the soda fountain. An employee, Mr. Tucker, took her order; another employee served

the order, but placed it “amongst dirty dishes on the counter.” (Ibid.) Tucker then said

loudly, ‘“What did you serve the nigger for? I wouldn’t have served her; she could have

set there until tomorrow.”’ (Ibid.) Tucker hit the plaintiff on the face and threw a cup of

coffee at her chest. The plaintiff sued under section 51, and was awarded damages of

$500. The Court of Appeal affirmed, stating, “[T]he damages allowed were allowed as

damages sustained because respondent was not accorded the same accommodations,

advantages, facilities and privileges, applicable alike to persons of the white race.” (Id. at

p. 393.) There was no discussion about whether the plaintiff paid for her order before

Tucker attacked her, and there is no indication that the plaintiff’s standing to assert a

cause of action depended on whether she paid defendant for her meal at the time the

discrimination occurred.

In Evans v. Fong Poy (1941) 42 Cal.App.2d 320, a couple went into a café and

ordered drinks and sandwiches, but they were refused service. (Id. at 321.) “The

testimony introduced by plaintiffs showed that they were told by the bartender and the

floor manager that they could not be served at the bar because they were colored people.”

11

(Id. at p. 321.) The Court of Appeal affirmed the judgment in favor of the plaintiffs, and

held that the action properly fell under sections 51 and 52. (Id. at p. 321.) The fact that

plaintiffs were refused service suggests that their standing to assert a violation of section

51 did not turn on whether they purchased a meal or otherwise paid for the defendant’s

products or services.

In Stone v. Board of Directors (1941) 47 Cal.App.2d 749, the petitioners, who

were “members of the Negro race, citizens, residents and qualified electors of the city of

Pasadena,” sought a writ of mandamus under section 51 to require various managing

bodies to admit them to the “municipal bath houses and swimming pool, commonly

known as Brookside Park Plunge.” (Id. at p. 750.) The pool was available to petitioners

only at limited times, and petitioners argued that “their exclusion on account of their race

and color from the municipal plunge in Brookside Park at all times when it is open to the

public, except on one day of each week, sufficiently alleges a cause of action.” (Id. at p.

751.) The Court of Appeal agreed that “the acts here complained of are expressly

enjoined by the provisions of section 51 of the Civil Code.” (Id. at p. 752.) While the

court noted that “certain controverted issues” remained to be determined by the trial

court, there was no indication that the petitioners were required to pay the entrance fee at

the Brookside Park Plunge before establishing standing to assert their rights under section

51.

In 1951, the Supreme Court considered a case involving the revocation of the

plaintiff’s restaurant liquor license, where the State Board of Equalization “found that

plaintiff ‘kept and permitted his licensed premises to be used as a disorderly house in that

. . . persons of known homosexual tendencies patronized said premises and used said

premises as a meeting place.” (Stoumen v. Reilly (1951) 37 Cal.2d 713, 715.) The

Supreme Court held that use of the premises as a meeting place for legal activity was not

a valid basis for revoking a liquor license, and noted that under the Unruh Act, the

plaintiff would be barred from discriminating against such patrons: “Members of the

public of lawful age have a right to patronize a public restaurant and bar so long as they

are acting properly and are not committing illegal or immoral acts; the proprietor has no

12

right to exclude or eject a patron ‘except for good cause,’ and if he does so without good

cause he is liable in damages. See Civ.Code, ss 51, 52.” (Id., at p. 716.) The Supreme

Court later noted, “[I]n Stoumen . . . this court clearly established that the Civil Rights

Act prohibited all arbitrary discrimination in public accommodations” (In re Cox, supra,

3 Cal.3d at p. 214), suggesting that historically the statute has been applied broadly.

In the 1950s, a string of cases held that certain businesses, such as a cemetery, a

dentist’s office, and a private school, were not “places of public accommodation or

amusement,” and therefore were not subject to the provisions of sections 51 and 52.

(See, e.g., Long v. Mountain View Cemetery Asso. (1955) 130 Cal.App.2d 328

[cemetery]; Coleman v. Middlestaff (1957) 147 Cal.App.2d Supp. 833 [dentist’s office];

Reed v. Hollywood Professional School (1959) 169 Cal.App.2d Supp. 887 [private

school].) Sections 51 and 52 were therefore expanded in 1959 to become the modern

Unruh Civil Rights Act, which prohibited discrimination on the basis of race, color,

religion, ancestry, or national origin. (See Horowitz, The 1959 Equal Rights in Business

Establishments Statute – A Problem in Statutory Application (1960) 33 So.Cal. L.Rev.

260, 265.)

Following the change in the law, the Supreme Court decided Burks v. Poppy

Construction Co. (1962) 57 Cal.2d 463, in which the plaintiffs alleged that the

“[d]efendants maintained a policy and practice of refusing to sell housing in the tract to

Negroes and, because of plaintiffs’ race and color, defendants refused to sell any house in

the tract to plaintiffs upon conditions offered to non-Negroes.” (Id. at p. 468.) The

Supreme Court held that the plaintiffs had stated a cause of action under the Unruh Act,

and offered no suggestion that the plaintiffs were required to purchase a house at a higher

price or otherwise show monetary damages in order to establish standing. (Id. at p. 471.)

The same day, the Supreme Court also held that a demurrer was improperly sustained

where a “plaintiff requested defendants to procure possession of the premises for him

upon the offered terms, and defendants refused to rent to plaintiff solely because of his

race.” (Lee v. O’Hara (1962) 57 Cal.2d 476, 477.) The Court said, “A broker who, in

disregard of his agreement with the owner to rent to any member of the public, refuses to

13

rent to a particular prospective tenant is obviously denying services to that person.” (Id.

at p. 478.) The Court did not suggest that the plaintiffs were required to show monetary

harm to establish damages.

In the habeas corpus proceeding In re Cox, supra, the petitioner stopped in a

shopping center parking lot to chat with his friend, a “young man, who wore long hair

and dressed in an unconventional manner.” (Cox, supra, 3 Cal.3d at p. 210.) The

shopping center security officer asked the men to leave. They refused, stating their intent

to make a purchase, but the security officer called police and they were arrested. (Id. at

p. 210.) The Supreme Court considered whether petitioner’s ejection from the premises

ran afoul of the Unruh Act. The Court held that the act was not limited to racial

discrimination; “both its history and its language disclose a clear and large design to

interdict all arbitrary discrimination by a business enterprise. That the act specifies

particular kinds of discrimination—color, race, religion, ancestry, and national origin—

serves as illustrative, rather than restrictive, indicia of the type of conduct condemned.”

(Id. at p. 212.) The Court noted that a “business establishment may, of course,

promulgate reasonable department regulations that are rationally related to the services

performed and the facilities provided.” (Id. at p. 217.) However, “a business generally

open to the public may not arbitrarily exclude a would-be customer from its premises

and, upon the customer’s refusal to leave, subject him to criminal conviction.” (Id. at p.

216.) Although the petitioner in Cox made a purchase on the premises before being

arrested, the Supreme Court gave no indication that his rights under the Unruh Act

attached as a result of that purchase.

In 1985, the Supreme Court considered whether the Unruh Act prohibited sex-

based discounts in Koire, supra, 40 Cal.3d 24. There, a male plaintiff visited nightclubs

and car washes that offered discounts to women on certain days. Plaintiff requested the

same discounts offered to women and the defendants refused. Plaintiff sued. The

defendants argued “that the Unruh Act prohibits only the exclusion of a member of a

protected class from a business establishment.” (Id. at p. 29.) Because the plaintiff was

not excluded, but charged only different prices at certain times, the defendants argued

14

that the Unruh Act did not apply. The Supreme Court rejected this argument: “The Act

guarantees ‘full and equal accommodations, advantages, facilities, privileges, or services

. . . .’ (§ 51.) The scope of the statute clearly is not limited to exclusionary practices.

The Legislature’s choice of terms evidences concern not only with access to business

establishments, but with equal treatment of patrons in all aspects of the business.” (Ibid.)

The Court also stated, “The Act’s proscription is broad enough to include within its scope

discrimination in the form of sex-based price discounts.” (Id. at p. 30.) The Court

concluded, “The express language of the Unruh Act provides a clear and objective

standard by which to determine the legality of the practices at issue. The Legislature has

clearly stated that business establishments must provide ‘equal . . . advantages . . . [and]

privileges’ to all customers ‘no matter what their sex.’ (§ 51.)” (Id. at p. 39.) The

Supreme Court did not clearly state whether the plaintiff purchased car washes at higher

prices or paid the higher entry fee to the nightclub. The Court gave no indication that the

plaintiff’s standing required a showing that he had paid the higher price.

The first case to directly examine standing under the Unruh Act appears to be

Midpeninsula Citizens for Fair Housing v. Westwood Investors (1990) 221 Cal.App.3d

1377 (Midpeninsula). In that case, Midpeninsula Citizens for Fair Housing (MCFH), “a

nonprofit corporation which works to eliminate discriminatory housing practices and to

secure equal housing opportunities for all people,” sued the owners and managers of an

apartment complex called the Westwood. (Id. at p. 1380.) MCFH alleged that the

Westwood’s one-person-per-bedroom policy violated the Unruh Act because it

discriminated against families with multiple children, and it had a discriminatory impact

on certain minority groups who tend to have larger families. (Id. at p. 1381.) MCFH

argued that it had standing to sue under the Unruh Act because it was “aggrieved” after

spending time and resources investigating discrimination at the Westwood: “Westwood’s

rental policy caused a drain on its limited resources, thus diverting needed funds from

important educational and counseling services.” (Id. at p. 1382.) The Court of Appeal

noted that “the state Legislature has specifically conferred standing to sue under the

Unruh Act upon the victims of the discriminatory practices and certain designated others,

15

i.e., district or city attorneys or the Attorney General. [Citations.]” (Id. at p. 1386.) The

court concluded, “[W]e reject MCFH’s contention that the Legislature intended, by

adding the language ‘a person aggrieved by the pattern or practice,’ to confer standing

upon an expanded class of plaintiffs whose civil rights had not been personally violated.”

(Id. at p. 1384.)

In 2007 the Supreme Court discussed the Koire holding in Angelucci, discussed

above. In Koire the plaintiff specifically requested, and was denied, the sex-based

discounted prices. In Angelucci, the male nightclub patrons did not establish that they

had requested that the women’s discounted nightclub prices be extended to them. The

Court clarified that the plaintiffs were not required to demand lower admission fees and

be refused in order to establish an Unruh Act violation: “[T]he Act does not contain

express language requiring that before a legal action may be filed, the victim of the

asserted discrimination must have demanded equal treatment and have been refused.

Unlike some other remedy statutes, the Act, and specifically section 52(a), does not

establish as a condition of instituting a lawsuit that the defendant have been given notice

and an opportunity to correct the asserted violation.” (Angelucci, supra, 41 Cal.4th at p.

168.)

The Court of Appeal relied on Angelucci in Surrey, also discussed above. The

plaintiff in Surrey alleged that sex-based discounts for an online dating service were

discriminatory. The court noted that the plaintiff’s request for injunctive relief was moot

because the discount program had already terminated. (Surrey, supra, 168 Cal.App.4th at

p. 417.) In determining the plaintiff’s standing for his remaining claims, the court noted,

“The focus of the standing inquiry is on the plaintiff, not on the issues he or she seeks to

have determined; he or she must have a special interest that is greater than the interest of

the public at large and that is concrete and actual rather than conjectural or hypothetical.”

(Id. at p. 417.) The court said, “The mere fact that Surrey became aware TrueBeginnings

was offering a discount policy for women subscribers at the time he accessed its

[w]ebsite did not constitute a denial of his anti-discrimination rights under those

statutes.” (Id. at p. 418.) The court specifically considered the holding in Angelucci:

16

“[T]he California Supreme Court’s acknowledgement in Angelucci that ‘“a plaintiff

cannot sue for discrimination in the abstract, but must actually suffer the discriminatory

conduct”’ is fatal to Surrey’s position here. (Angelucci, supra, 41 Cal.4th at pp. 165,

175.) Because he did not attempt to or actually subscribe to TrueBeginnings’ services,

Surrey did not suffer discrimination in any sense other than ‘in the abstract.’ Thus, in

accordance with Angelucci itself, he lacks standing to seek relief (whether damages or

injunctive relief) for violations of the Unruh Act.” (Id. at p. 420.)

We agree with the reasoning in Surrey and Midpeninsula that a plaintiff who only

learns about the defendant’s allegedly discriminatory conduct, but has not personally

experienced it, cannot establish standing. Neither MCFH in Midpeninsula nor the

plaintiff in Surrey experienced the denial of full and equal treatment by the defendants in

those cases. Moreover, because the discount program in Surrey already had terminated,

the plaintiff was not in a position to seek injunctive relief.

We do, however, find that the articulated bright-line rule in Surrey is not

appropriate on the facts before us. Surrey stated that “a person must tender the purchase

price for a business’s services or products in order to have standing to sue it for alleged

discriminatory practices relating thereto.” (Surrey, supra, 168 Cal.App.4th at p. 416.)

Neither the language of the Unruh Act nor its history support application of this bright-

line rule here. The history of the Unruh Act and the cases interpreting it make clear that

when a person presents himself or herself to a business establishment, and is personally

discriminated against based on one of the characteristics articulated in section 51, he or

she has suffered a discriminatory act and therefore has standing under the Unruh Act.

And when such discrimination occurs, a person has standing under section 51.5 if he or

she is “associated with” the disabled person and has also personally experienced the

discrimination.

This holding comports with the history and intention of the Unruh Act. The cases

discussing discrimination under sections 51 and 52 do not focus on whether patrons who

were personally discriminated against have alleged or proved that they paid a fee or were

subject to unfair pricing before bringing a lawsuit. Indeed, much of the legal history

17

surrounding sections 51 and 52 involve plaintiffs who—like Flowers and his family—

were refused services, thereby making a purchase impossible. To hold that plaintiffs here

lacked standing would contradict both the language and the intent of the Unruh Act.

Moreover, this case involves accommodation for a disability. As we noted last

year in a case also involving Flowers, “denying a disabled person access to a public

accommodation due to that person’s service dog constitutes a potential violation of the

ADA.”8 (Flowers v. Prasad (2015) 238 Cal.App.4th 930, 937.) “In 1992 . . . the

Legislature amended section 51 to, among other changes, add the paragraph that became

subdivision (f), specifying that ‘[a] violation of the right of any individual under the

Americans with Disabilities Act of 1990 (Public Law 101–336) shall also constitute a

violation of this section.’ (Stats.1992, ch. 913, § 3, p. 4284; see Stats.2000, ch. 1049, § 2

[adding subdivision designations].)” (Munson, supra, 46 Cal.4th at p. 668.) “The

general intent of the legislation was expressed in an uncodified section: ‘It is the intent of

the Legislature in enacting this act to strengthen California law in areas where it is

weaker than the Americans with Disabilities Act of 1990 (Public Law 101-336) and to

retain California law when it provides more protection for individuals with disabilities

than the Americans with Disabilities Act of 1990.’ (Stats.1992, ch. 913, § 1, p. 4282.)”

(Id. at p. 669.) Requiring disabled persons to pay a discriminatory fee to establish

standing when they have been personally denied equal access does not comport with the

legislative intent to provide broad protections for ADA violations under the Unruh Act.

8

ADA regulations define a service animal as follows: “Service animal means any

dog that is individually trained to do work or perform tasks for the benefit of an

individual with a disability, including a physical, sensory, psychiatric, intellectual, or

other mental disability. . . . The work or tasks performed by a service animal must be

directly related to the individual’s disability.” (28 C.F.R. §§ 35.104, 36.104.) ADA

regulations state that “[i]ndividuals with disabilities shall be permitted to be accompanied

by their service animals in all areas of a public entity’s facilities where members of the

public, participants in services, programs or activities, or invitees, as relevant, are

allowed to go.” (28 C.F.R. § 35.136(g).) In addition, “[a] public entity shall not ask or

require an individual with a disability to pay a surcharge, even if people accompanied by

pets are required to pay fees, or to comply with other requirements generally not

applicable to people without pets.” (28 C.F.R. § 35.136(h).)

18

We therefore depart from Surrey’s bright-line rule and hold that tender of payment

of a discriminatory fee is not required to establish standing under the Unruh Act where a

disabled individual has personally experienced discriminatory treatment at a business

establishment. Plaintiffs were therefore not required to allege that they tendered the fee

relating to Flowers’s service dog to establish standing under the Unruh Act and section

51.5.9

[The portions of this opinion that follow (parts B. and C.) are omitted from publication]

B. Osborne’s amended complaint was not a sham pleading

In addition to challenging the trial court’s ruling on the Unruh Act allegations,

Osborne argues that the trial court erred by holding that her amended complaint was a

sham pleading. We agree.

“Under the sham pleading doctrine, plaintiffs are precluded from amending

complaints to omit harmful allegations, without explanation, from previous complaints to

avoid attacks raised in demurrers or motions for summary judgment.” (Deveny v.

Entropin, Inc. (2006) 139 Cal.App.4th 408, 425.) “The sham pleading doctrine is not

‘“intended to prevent honest complainants from correcting erroneous allegations . . . or to

prevent correction of ambiguous facts.”’ (5 Witkin, Cal. Procedure (4th ed. 1997)

Amendment of Pleadings § 1122, pp. 577–578.) Instead, it is intended to enable courts

‘“to prevent an abuse of process.”’ [Citation.]” (Id. at p. 426.)

Osborne’s original complaint was very brief and contained few facts. Osborne

alleged that she was “refused and denied a room accommodation at Defendants’ Hotel

due to Plaintiff’s association with a disabled person who uses an assistance animal.” She

also alleged, “Defendants insisted the lodging offered to the general public could not be

9

Plaintiffs also argue that section 54.2, which is part of the Disabled Persons Act,

provides standing to sue under the Unruh Act. Because we find that plaintiffs were not

required to pay the fee to establish standing under the Unruh Act, we do not reach

plaintiff’s argument that the intersection of these two statutory schemes may also provide

standing under the Unruh Act. We also do not address defendants’ argument that

Osborne and the Messmers do not have standing under the Disabled Persons Act, because

they did not allege such a cause of action.

19

offered to Plaintiff unless a non-refundable cleaning fee deposit of $300 was paid, in

addition to the regular room fee of approximately $80 normally charged to all other

members of the public.”

After the trial court granted defendants’ motion for judgment on the pleadings and

provided Osborne leave to amend, Osborne filed a first amended complaint that included

additional facts. In the amended complaint, Osborne alleged, “Plaintiff was not refused a

room because of her failure to pay a charge or deposit because of a service dog, but rather

was refused a room by Defendants’ agent . . . because the hotel claimed it had the right of

refusal . . . and the ownership and management of the hotel did not want a dog in the

hotel.” She also alleged that “Plaintiff, through a family member, offered to pay the

deposit, but it was refused since the hotel did not want a dog in the hotel and the hotel

manager claimed the hotel had the right or refusal.”

Defendants demurred and argued that the amended complaint was a sham pleading

because it “directly contradicts the judicial admissions made in the original complaint,

deposition testimony, and prior sworn admissions.” Osborne opposed the demurrer, and

explained that her son Kody Messmer told her that after the family left the hotel and went

to a nearby restaurant, Kody returned to the hotel and offered to pay the $300 fee. Kody

reported that the manager told him that the fee was not really the issue, the hotel simply

did not want dogs. Osborne said Kody did not mention this to her until shortly before she

filed the amended complaint.

The trial court found that Osborne’s first amended complaint was a sham pleading.

The court considered Osborne’s original complaint, deposition testimony, and a letter she

sent to the hotel, each of which focused on the $300 fee. The court order stated, “In the

face of this testimony, for plaintiff to now allege that defendant’s [sic] refusal to rent a

room had nothing to do with a $300 deposit, and instead was simply an outright refusal to

rent to persons accompanied by a dog, is clearly a sham pleading. This conclusion is

further supported by the allegations of the original complaint [in which] there was no

allegation of an outright refusal to rent to persons with dogs and/or service animals.”

20

Osborne argues that this was erroneous because the facts alleged in the amended

complaint do not contradict the facts alleged in the original complaint. She also asserts

that the court mistook her Unruh Act allegation to be based on discriminatory pricing,

when in fact the discriminatory treatment, not the pricing itself, was the basis for her

cause of action.

Here, Osborne did not omit or change harmful allegations. Instead, she added new

facts about what allegedly occurred after the incident described in the original complaint.

Osborne’s new facts may have called into question defendants’ motives, because it was

unclear whether defendants wanted the extra $300 cleaning fee or whether they simply

were refusing to rent a room to plaintiffs because of the dog. But defendants’ motives

have no impact on Osborne’s ability to state a cause of action. “A plaintiff who

establishes a violation of the ADA . . . need not prove intentional discrimination in order

to obtain damages under section 52.” (Munson, supra, 46 Cal.4th at p. 665.) Moreover,

the sham pleading doctrine focuses on inconsistent facts, not inconsistent legal theories.

(Dubin v. Robert Newhall Chesebrough Trust (2002) 96 Cal.App.4th 465, 477 [“A

plaintiff is permitted to plead alternative inconsistent theories.”].) Even if Osborne had

asserted a discriminatory pricing theory in her original complaint and changed her theory

to a more traditional disability discrimination claim in her amended complaint, that

would not be a proper basis upon which to sustain a demurrer. A demurrer must be

overruled where “the plaintiff has stated a cause of action under any possible legal

theory.” (Aubry v. Tri-City Hospital Dist. (1992) 2 Cal.4th 962, 967.)

Under the sham pleading doctrine, “any inconsistencies with prior pleadings must

be explained; if the pleader fails to do so, the court may disregard the inconsistent

allegations.” (Vallejo Development Co. v. Beck Development Co. (1994) 24 Cal.App.4th

929, 946.) In her opposition to the demurrer, Osborne explained how she came to

discover the new facts alleged in her amended complaint. If defendants found the

explanation implausible, they were free to explore the newly alleged facts in discovery.

But implausibility is not a basis upon which to determine that an amended pleading is a

sham. “It is not the ordinary function of a demurrer to test the truth of the plaintiff’s

21

allegations or the accuracy with which he [or she] describes the defendant’s conduct. A

demurrer tests only the legal sufficiency of the pleading.” (Committee on Children’s

Television, Inc. v. General Foods Corp. (1983) 35 Cal.3d 197, 213.) “[T]he facts alleged

in the pleading are deemed to be true, however improbable they may be.” (Del E. Webb

Corp. v. Structural Materials Co. (1981) 123 Cal.App.3d 593, 604.)

Osborne’s addition of facts describing events that occurred after the incident

alleged in her original complaint therefore did not render her first amended complaint a

sham pleading, and the trial court erred by sustaining the demurrer on this basis.

C. The judgments as to plaintiffs’ intentional infliction of emotional

distress causes of action must be reversed

Plaintiffs also argue that they adequately alleged causes of action for intentional

infliction of emotional distress based on the facts in the complaint and the required

elements for this cause of action. However, defendants did not demur on the basis that

plaintiffs’ complaints failed to adequately allege causes of action for intentional infliction

of emotional distress. In their notice of demurrer to Osborne’s amended complaint,

defendants asserted only that the amended complaint was a sham pleading. In the notice

of demurrer to the Flowers/Messmer complaint, defendants asserted only that the

emotional distress cause of action was “derivative” of the Unruh Act cause of action, and

“is likewise properly dismissed.” Neither trial court order considered whether plaintiffs’

intentional infliction of emotional distress causes of action sufficiently alleged facts to

state a cause of action. We decline to consider this issue on appeal in the first instance.

22

[The remainder of this opinion is to be published]

DISPOSITION

The trial court judgments are reversed and the matters are remanded with

directions to vacate the orders sustaining the demurrers and enter new orders overruling

the demurrers. Appellants shall recover their costs on appeal.

CERTIFIED FOR PARTIAL PUBLICATION

COLLINS, J.

We concur:

EPSTEIN, P. J.

WILLHITE, J.

23