# Mag US Lounge Management LLC v. Ontario International Airport Authority

> District Court, C.D. California · February 13, 2023

URL: https://www.frixlaw.com/law-library/cases/9982458

## Case

- **Court:** District Court, C.D. California
- **Decided:** February 13, 2023
- **Opinion:** 100trialcourt
- **Cited by:** 0 later opinions in the Frix Law Library

## Citator (automated)

- No negative treatment found by the automated citator. That is not the same as a confirmation that the case is good law; read the citing cases.
- Full citator and citing cases: https://www.frixlaw.com/law-library/cases/9982458

## How later opinions describe it (automated extraction)

- holding that a series of written correspondence does not constitute a claim within the meaning of the Government Claims Act

## Opinion text

Case 2:21-cv-04909-CAS-RAO Document 51 Filed 02/13/23 Page1of11 Page ID #:368
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES — GENERAL ‘O’
Case No. 2:21-cv-04909-CAS(RAOx): C/W: Date February 13, 2023
5:22-cv-01926-CAS(RAOx)
Title MAG US LOUNGE MANAGEMENT, LLC v. ONTARIO
INTERNATIONAL AIRPORT AUTHORITY; C/W: ONTARIO
INTERNATIONAL AIRPORT AUTHORITY v. MAG US LOUNGE
MANAGEMENT, LLC

Present: The Honorable CHRISTINA A. SNYDER
Catherine Jeang Laura Elias N/A
Deputy Clerk Court Reporter / Recorder Tape No.
Attorneys Present for Plaintiffs: Attorneys Present for Defendants:
Adam Fox David Hubbard
Kendall Teal Krause
Proceedings: DEFENDANT’S MOTION TO DISMISS (Dkt. 9, filed on JULY
19, 2021)
DEFENDANT’S RENEWED MOTION TO DISMISS (Dkt. 39,
filed on JANUARY 12, 2023)
I. INTRODUCTION
Presently before the Court is defendant Ontario International Airport Authority’s
(“OIAA”) motion to dismiss plaintiff MAG US Lounge Management LLC’s (“MAG”)
complaint.
On June 16, 2021, MAG filed suit against OIAA for (1) breach of contract; (2)
breach of the implied covenant of good faith and fair dealing; and (3) declaratory relief.
Dkt. 1 (‘Compl.”).
On July 19, 2021, OJAA filed a motion to dismiss MAG’s complaint for failure to
state a claim. See Dkt. 9 (“Mot.”). On August 23, 2021, MAG filed an opposition to
defendant’s motion to dismiss. Dkt. 11 (“Opp.”). On August 30, 2021, OIAA filed a
reply. Dkt. 14 (“Reply”).
OIAA’s motion to dismiss was denied as moot 1n light of an unrelated appeal, the
background of which is known to the parties and set forth in the Court’s recent February

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Case 2:21-cv-04909-CAS-RAO Document 51 Filed 02/13/23 Page 2of11 Page ID #:369
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES — GENERAL ‘O’
Case No. 2:21-cv-04909-CAS(RAOx): C/W: Date February 13, 2023
5:22-cv-01926-CAS(RAOx)
Title MAG US LOUNGE MANAGEMENT, LLC v. ONTARIO
INTERNATIONAL AIRPORT AUTHORITY; C/W: ONTARIO
INTERNATIONAL AIRPORT AUTHORITY v. MAG US LOUNGE
MANAGEMENT, LLC
6, 2023 Order denying MAG’s motion to dismiss OJAA’s complaint in a related and
consolidated action. See 5:22-cv-01926-CAS-RAO, Dkt. 35.
On January 12, 2023, OIAA renewed its July 2021 motion to dismiss MAG’s
complaint for failure to state a claim. See Dkt. 39.
On February 13, 2023, the Court held a hearing. Having carefully considered the
parties’ arguments and submissions, the Court finds and concludes as follows.
I. BACKGROUND
A. The parties enter into an airport concession lease agreement
In June 2018, OLAA and MAG entered into an airport concession lease agreement
under which MAG agreed to provide and operate online car parking services and
establish and operate passenger lounges at the airport. Compl. § 2. The previous parking
manager of Ontario Airport was Parking Concepts Inc. (“PCI”). Id. § 3.
The Agreement’s effective date was July 1, 2018. Pursuant to the Agreement,
MAG was to provide car parking services for a term commencing on July 1, 2018, and
ending 10 years after the commencement of the Agreement’s lounge concession term,
which commenced on or about April 1, 2019. Id. § 14. The Agreement also provided, in
Section 5.10.1, that OIAA “will not contract with any other person or entity to perform
the Car Parking Services . . . during the Car Parking Services Term; provided, however,
(a) [MAG] is not in default of any term or provision of this Agreement, or (b) this
Agreement is not earlier terminated as provided herein.” Id.
The Agreement stated that either party could terminate the Agreement for
convenience, without cause, upon one-year prior written notice. Id. 19. IfOIAA
provided notice of termination more than one year prior to the termination date of the
term, OIAA was required to pay the unamortized portion of MAG’s improvement costs
and car parking services costs within 30 days of notice (“Termination Costs”). Id.

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Case 2:21-cv-04909-CAS-RAO Document 51 Filed 02/13/23 Page 3o0f11 Page ID #:370
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES — GENERAL ‘OQ’
Case No. 2:21-cv-04909-CAS(RAOx): C/W: Date February 13, 2023
5:22-cv-01926-CAS(RAOx)
Title MAG US LOUNGE MANAGEMENT, LLC v. ONTARIO
INTERNATIONAL AIRPORT AUTHORITY; C/W: ONTARIO
INTERNATIONAL AIRPORT AUTHORITY v. MAG US LOUNGE
MANAGEMENT, LLC
B. OJFAA publishes a request for proposals
MAG alleges that, months after the parties coordinated a business response at the
airport to the outbreak of the COVID-19 pandemic in 2020 and after MAG’s CEO
declined to make a charitable contribution at the request of OIAA’s board president,
OIAA published a request for proposals (“RFP”) to solicit bids for operation of a car
park, car parking services, and shuttle bus operations at the airport. Id. 15-17. MAG,
PCI (the company serving as parking manager prior to MAG and OJAA’s Agreement),
and another bidder responded to the RFP. Id. § 17.
On February 17, 2021, OIAA notified MAG of its intent to recommend that its
board award the RFP to PCI and to terminate the Agreement with MAG once its board
approved of the recommended award. Id. § 18. On February 23, 2021, MAG submitted a
notice of protest to the RFP award to PCI, reserving all legal rights as to OIAA. Id. § 22.
On March 11 and 16, 2021, OIAA wrote to MAG demanding that MAG reopen the
airport lounges no later than March 26, 2021. MAG agreed to comply and reopen on
March 26, 2021, although MAG had attempted to request a delay of the lounge opening
in light of ongoing pandemic and strained financial circumstances at that time. Id. § 23.
On February 25, 2021, PCI executed the contract resulting from the RFP and
submitted it to OIAA for approval. On March 25, 2021, OIAA formally denied MAG’s
protest to the RFP award and authorized its CEO to execute the contract with PCI. Id. §
24.
C. OJTAA terminates the Agreement
On April 15, 2021, OIAA provided MAG notice of termination, proposing a 90-
day transition period and requesting that MAG provide a reconciliation of all outstanding
unamortized capital expenditures for purposes of calculating Termination Costs. Id. § 26.
Based on Section 2.4.1 of the Agreement, the deadline for OJAA to pay Termination
Costs was May 19, 2021.

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Case 2:21-cv-04909-CAS-RAO Document 51 Filed 02/13/23 Page 40f11 Page ID #:371
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES — GENERAL ‘O’
Case No. 2:21-cv-04909-CAS(RAOx): C/W: Date February 13, 2023
5:22-cv-01926-CAS(RAOx)
Title MAG US LOUNGE MANAGEMENT, LLC v. ONTARIO
INTERNATIONAL AIRPORT AUTHORITY; C/W: ONTARIO
INTERNATIONAL AIRPORT AUTHORITY v. MAG US LOUNGE
MANAGEMENT, LLC
On May 10, 2021, MAG sent a letter to OIAA stating that OLAA owed MAG
$3,040,553 in Termination Costs based on MAG’s capital expenditures, pursuant to
Section 2.4.1 of the Agreement. □□□ □□□ Additionally, MAG acknowledged that OIAA
had overpaid to MAG its contractual obligation of incremental turn-up revenues in the
amount of $1,181,418. MAG stated it was willing to accept an offset in payment,
rendering OJAA’s net Termination Costs to be paid to MAG in the amount of
$1,859,135. Id.
On May 13, 2021, OIAA sent a letter to MAG acknowledging that $1,859,135 was
the initial rembursable amount owed by OIAA,” but claimed that the termination
payment should be further offset by additional calculations totaled $3,002,491. Asa
result, OIAA contended that no monies were owed to MAG and instead, that MAG owed
$1,118,258 to OIAA. Id.
On May 18, 2021, OIAA asserted that MAG was in breach of Sections 3.26.5 and
3.26.6 of the Agreement. Id. § 30.
OIAA did not pay MAG Termination Costs by the May 19, 2021 deadline. On
May 20, 2021, MAG “provided formal notice of OIAA’s breach of section 2.4.1 of the
Agreement.” Id. § 31. The same day, OIAA claimed that MAG separately breached the
Agreement by failing to remit payment of $1,118,258 to OIAA. Id.
On May 20, 2021, OIAA notified MAG that it was in breach of the Agreement for
failing to pay $1,118,258 to OIAA. Id. § 31.
Il. LEGAL STANDARD
A motion pursuant to Federal Rule of Civil Procedure 12(b)(6) tests the legal
sufficiency of the claims asserted in a complaint. Under this Rule, a district court
properly dismisses a claim if “there 1s a ‘lack of a cognizable legal theory or the absence
of sufficient facts alleged under a cognizable legal theory.” ” Conservation Force v.
Salazar, 646 F.3d 1240, 1242 (9th Cir. 2011) (quoting Balisteri v_ Pacifica Police Dep't,
901 F.2d 696, 699 (9th Cir. 1988)). “While a complaint attacked by a Rule 12(b)(6)
motion to dismiss does not need detailed factual allegations, a plaintiff's obligation to

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Case 2:21-cv-04909-CAS-RAO Document 51 Filed 02/13/23 Page5of11 Page ID#:372
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES — GENERAL ‘O’
Case No. 2:21-cv-04909-CAS(RAOx): C/W: Date February 13, 2023
5:22-cv-01926-CAS(RAOx)
Title MAG US LOUNGE MANAGEMENT, LLC v. ONTARIO
INTERNATIONAL AIRPORT AUTHORITY; C/W: ONTARIO
INTERNATIONAL AIRPORT AUTHORITY v. MAG US LOUNGE
MANAGEMENT, LLC
provide the ‘grounds’ of his ‘entitlement to relief’ requires more than labels and
conclusions, and a formulaic recitation of the elements of a cause of action will not do.”
Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555 (2007). “[F]actual allegations must
be enough to raise a right to relief above the speculative level.” Id.
In considering a 12(b)(6) motion, a court must accept as true all material
allegations in the complaint, and all reasonable inferences to be drawn from them. Pareto
v. FDIC, 139 F.3d 696, 699 (9th Cir. 1988). A court must read the complaint in the light
most favorable to the non-movant. Sprewell v. Golden State Warriors, 266 F.3d 979, 988
(9th Cir. 2001). However, “a court considering a motion to dismiss can choose to begin
by identifying pleadings that, because they are no more than conclusions, are not entitled
to the assumption of truth. While legal conclusions can provide the framework of a
complaint, they must be supported by factual allegations.” Ashcroft v. Iqbal, 556 U.S.
662, 679 (2009): see Moss v. United States Secret Service, 572 F.3d 962, 969 (9th Cir.
2009) (“[F]or a complaint to survive a motion to dismiss, the non-conclusory ‘factual
content,’ and reasonable inferences from that content, must be plausibly suggestive of a
claim entitling the plaintiff to relief.”). Ultimately, “[d]etermining whether a complaint
states a plausible claim for relief will . . . be a context-specific task that requires the
reviewing court to draw on its judicial experience and common sense.” Iqbal, 556 U:S. at
679.
Unless a court converts a Rule 12(b)(6) motion into a motion for summary
judgment, a court cannot consider material outside of the complaint (e.g., facts presented
in briefs, affidavits, or discovery materials). In re American Cont’] Corp./Lincoln Sav. &
Loan Sec. Litig., 102 F.3d 1524, 1537 (9th Cir. 1996), rev’d on other grounds sub nom
Lexecon, Inc. v. Milberg Weiss Bershad Hynes & Lerach, 523 U.S. 26 (1998). A court
may, however, consider exhibits submitted with or alleged in the complaint and matters
that may be judicially noticed pursuant to Federal Rule of Evidence 201. See Lee v. City
of Los Angeles, 250 F.3d 668, 689 (9th Cir. 2001). Where a court converts a motion to
dismiss into a motion for summary judgment, “[a]ll parties must be given a reasonable
opportunity to present all the material that is pertinent to the motion.” Fed. R. Civ. P.
12(d).

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Case 2:21-cv-04909-CAS-RAO Document 51 Filed 02/13/23 Page 6of11 Page ID #:373
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES — GENERAL ‘O’
Case No. 2:21-cv-04909-CAS(RAOx): C/W: Date February 13, 2023
5:22-cv-01926-CAS(RAOx)
Title MAG US LOUNGE MANAGEMENT, LLC v. ONTARIO
INTERNATIONAL AIRPORT AUTHORITY; C/W: ONTARIO
INTERNATIONAL AIRPORT AUTHORITY v. MAG US LOUNGE
MANAGEMENT, LLC
While generally a “court should ‘freely give leave [to amend] when justice so
requires,’ ” leave to amend is “properly denied” where “amendment would be futile,”
Carrico v. City & Cty. of San Francisco, 656 F.3d 1002, 1008 (9th Cir. 2011) (quoting
Fed. R. Civ. P. 15(a)(2)). Amendment would be futile if the plaintiff cannot state a
cognizable claim. See Cervantes v. Countrywide Home Loans, Inc., 656 F.3d 1034, 1041
(9th Cir. 2011) (“Although leave to amend should be given freely, a district court may
dismiss without leave where a plaintiff's proposed amendments would fail to cure the
pleading deficiencies and amendment would be futile.”).
IV. DISCUSSION
OIAA moves to dismiss the entirety of MAG’s complaint for failure to comply
with the presentation requirements of the California Government Claims Act. The
California Government Claims Act requires that a party seeking to recover money
damages from a public entity or its employees must submit a claim to the entity before
filing suit in court, generally no later than six months after the cause of action accrues.
California Government Code §§ 905, 911.2, 945.4, and 950.2. Timely claim presentation
is not merely a procedural requirement but is an element of the plaintiffs claim for relief.
Shirk v. Vista Unified School District, 42 Cal. 4th 201, 209 (2007). A plaintiff may sue
the public entity and its employees in court only after the entity has acted upon or is
deemed to have rejected the claim. Id.; see Mangold v. California Public Utilities
Commission, 67 F.3d 1470, 1477 (9th Cir. 1995) (“The California Tort Claims Act
requires, as a condition precedent to suit against a public entity, the timely presentation of
a written claim and the rejection of the claim in whole or in part.”). The California
Supreme Court has held that the claims filing requirements of the Government Claims
Act apply to both tort and contract claims. City of Stockton v. Superior Court, 42 Cal.
4th 730, 738-41 (2007). Thus, when a plaintiff asserts a claim subject to the Government
Claims Act, it must affirmatively allege compliance with the claim presentation
procedure, or circumstances excusing such compliance, in its complaint. Shirk, 42
Cal.4th at 209: State of California v. Superior Court (Bodde), 32 Cal. 4th 1234, 1243
(2004) (plaintiff must allege facts “demonstrating or excusing compliance with the claim
presentation requirement’).

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Case 2:21-cv-04909-CAS-RAO Document 51 Filed 02/13/23 Page 7 of11 Page ID #:374
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES — GENERAL ‘O’
Case No. 2:21-cv-04909-CAS(RAOx): C/W: Date February 13, 2023
5:22-cv-01926-CAS(RAOx)
Title MAG US LOUNGE MANAGEMENT, LLC v. ONTARIO
INTERNATIONAL AIRPORT AUTHORITY; C/W: ONTARIO
INTERNATIONAL AIRPORT AUTHORITY v. MAG US LOUNGE
MANAGEMENT, LLC
“Substantial compliance” with the Government Claims Act will also suffice to
enable plaintiffs to state a claim for relief against a public entity. “The test for substantial
compliance is whether the face of the filed claim discloses sufficient information to
enable the public entity to make an adequate investigation of the claim’s merits and settle
it without the expense of litigation.” Connelly v. County of Fresno, 146 Cal. App. 4th 29,
38 (2006). So long as these purposes are effectuated, the statutory requirements “should
be given a liberal construction to permit full adjudication on the merits.” Stockett, 34
Cal. 4th at 449 (quoting Minsky v. City of Los Angeles, 11 Cal. 3d 113, 123 (1974)).
Additionally, Government Code Section 911 establishes that “[a]ny defense as to
the sufficiency of the claim based upon a defect or omission in the claim as presented 1s
waived by failure to give notice of insufficiency with respect to the defect or omission as
provided in Section 910.8... .” A “document constitutes a ‘claim as presented’. . . if it
discloses the existence of a claim which will result in a lawsuit against the entity if it is
not satisfactorily resolved.” Green v. State Ctr. Cmty. Coll. Dist., 34 Cal. App. 4th 1348
(1995) (citing Phillips v. Desert Hosp. Dist., 49 Cal. 3d 699, 705, 780 P.2d 349, 353
(1989)).
Here, OIAA argues that MAG failed to present its claims as required by the
Government Claims Act. Mot. at 5. Additionally, OIAA argues that MAG’s written
correspondence cannot be considered “substantial compliance,” citing cases narrowly
construing the Government Claims Act to find that letters cannot be considered
“substantial compliance” or a “claim as presented” to excuse MAG’s non-compliance
with the statutory requirements. See id. at 6—9 (citing Dilts v. Cantua Elementary Sch.
Dist., 189 Cal. App. 3d 27, 35-36 (Ct. App. 1987) (holding that a series of written
correspondence does not constitute a claim within the meaning of the Government
Claims Act)); Reply at 8 (citing Olson v. Manhattan Beach Unified Sch. Dist., 17 Cal.
App. 5th 1052, 1062 (Ct. App. 2017) (holding that a letter notifying a public entity of a
breach of contract is not a “claim as presented” because it did not “threaten litigation if
the contractual breaches are not remedied”)).
In opposition, MAG argues that its written correspondence with OIAA,
particularly its May 20, 2021 letter, satisfied the requirements of the Government Claims

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Case 2:21-cv-04909-CAS-RAO Document 51 Filed 02/13/23 Page 8of11 Page ID #:375
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES — GENERAL ‘O’
Case No. 2:21-cv-04909-CAS(RAOx): C/W: Date February 13, 2023
5:22-cv-01926-CAS(RAOx)
Title MAG US LOUNGE MANAGEMENT, LLC v. ONTARIO
INTERNATIONAL AIRPORT AUTHORITY; C/W: ONTARIO
INTERNATIONAL AIRPORT AUTHORITY v. MAG US LOUNGE
MANAGEMENT, LLC
Act. Opp. at 4. MAG alternatively argues that (1) its correspondence with OIAA
constitutes “substantial compliance” with the statutory requirements, or (2) its
correspondence can be considered a “claim as presented” pursuant to Section 911 that put
OIAA on sufficient notice despite a failure to show substantial compliance. Id. at 5—9.
In support of its contentions, MAG cites to cases that have found letters to either be
substantially compliant with the Government Claims Act or to otherwise constitute a
“claim as presented” pursuant to Section 911 triggering the public entity’s duty to notify
the claimant of the technical deficiencies. Id. at 7-8 (citing Gen. Sec. Servs. Corp. v.
Cnty. of Fresno, 815 F. Supp. 2d 1123, 1140 (E_D. Cal. 2011) (finding plaintiffs letter to
be substantially compliant with the Government Claims Act); All. Fin. v. City & Cnty. of
San Francisco, 64 Cal. App. 4th 635, 647 (1998) (“A communication to the public entity
that a claim has accrued and that the claimant intends to enforce it suffices, even though
the communication fails to notify the public entity that a lawsuit is imminent.”’)).
Dismissal of MAG’s claims at this juncture would be improper. The Court finds
that MAG’s letter is properly considered a “claim as presented” for which OJAA failed to
identify any deficiencies under the statutory requirements (thereby waiving its defense
pursuant to Section 911), and that even if OIAA did not waive this defense, MAG
nonetheless substantially complied with the Government Claims Act. As identified by
the parties’ briefing, both state appellate courts and federal district courts have variously
applied the Government Claims Act with respect to a party’s written correspondence.
Some courts have adopted a strict application of the provisions to find letters to be
insufficient to present a claim, while others have liberally construed the requirements to
excuse plaintiff's non-compliance with all of the statutory requirements. Compare Dilts,
189 Cal. App. 3d at 35—36 (“The established procedure for the filing of claims pursuant
to the [Government] Claims Act would become totally unworkable if this court were to
hold that a series of writings could collectively be considered a claim.”); Stampfli v.
Susanville Sanitary Dist., No. 220CV01566WBSDMC, 2021 WL 2457379, at *9 (E.D.
Cal. June 16, 2021) (“It is also questionable whether a series of letters can ever constitute
a claim within the meaning of the Government Claims Act.”): with Foster v. McFadden,
30 Cal. App. 3d 943, 948 (Ct. App. 1973) (plaintiff's letter “performed the function of a
claim” because it “accomplished the two principal purposes of a sufficient claim” by

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Case 2:21-cv-04909-CAS-RAO Document 51 Filed 02/13/23 Page 9of11 Page ID #:376
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES — GENERAL ‘O’
Case No. 2:21-cv-04909-CAS(RAOx): C/W: Date February 13, 2023
5:22-cv-01926-CAS(RAOx)
Title MAG US LOUNGE MANAGEMENT, LLC v. ONTARIO
INTERNATIONAL AIRPORT AUTHORITY; C/W: ONTARIO
INTERNATIONAL AIRPORT AUTHORITY v. MAG US LOUNGE
MANAGEMENT, LLC
affording the public entity the “opportunity to make a prompt investigation of the
accident occasioning the letter” and giving the public entity the “opportunity to settle
without suit, if it so desired”); Simms v. Bear Valley Cmty. Healthcare Dist., 80 Cal.
App. 5th 391, 407 (Ct. App. 2022) (holding that letter from plaintiff to public entity was a
claim as presented “triggering |the public entity’s] duty to notify [plaintiff] of its
insufficiencies”’).
Under the circumstances of this case, the Court finds the cases liberally construing
the provisions of the Government Claims Act to be more persuasive. As set forth above,
the purpose of the Government Claims Act is to provide a public entity with presentations
of claims “disclos[ing] sufficient information to enable the public entity to make an
adequate investigation of the claim’s merits and settle it without the expense of
litigation.” Connelly, 146 Cal. App. 4th at 38. So long as these two purposes are
effectuated, the statutory requirements “should be given a liberal construction to permit
full adjudication on the merits.” Stockett, 34 Cal. 4th at 449 (quoting Minsky, 11 Cal. 3d
at 123).
Here, MAG and OIJAA executed the Agreement, which set forth that “[e]xcept as
otherwise provided for in this Agreement, whenever either party desires to give notice to
the other, such notice must be” in the manner specified in Section 18.1. See Dkt. 4-1
(“Agreement”).! Taking MAG’s complaint as true, MAG alleges that the parties
corresponded in accordance with Section 18.1 of the parties’ Agreement, with OIAA first
providing MAG notice of termination of the Agreement on April 25, 2021. Compl. § 26.
Pursuant to Section 2.4.1 of the Agreement, the deadline for OIAA to pay Termination
' California Government Code Section 930.2 provides that “[t]he governing body of a
local public entity may include in any written agreement to which the entity . . . is a party,
provisions governing the presentation . . . of any or all claims arising out of or related to
the agreement and the consideration and payment of such claims. . . See Gen. Sec.
Servs. Corp., 815 F. Supp. 2d at 1140 (“[T]he Court is unaware of any requirement that a
contract must use particular language or expressly state that it changes specific
requirements of the Government Claims Act.”). Accordingly, it was proper for MAG to
present a claim in a letter pursuant Section 18.1 of the parties’ Agreement.
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Case 2:21-cv-04909-CAS-RAO Document 51 Filed 02/13/23 Page 100f11 Page ID #:377
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES — GENERAL ‘O’
Case No. 2:21-cv-04909-CAS(RAOx): C/W: Date February 13, 2023
5:22-cv-01926-CAS(RAOx)
Title MAG US LOUNGE MANAGEMENT, LLC v. ONTARIO
INTERNATIONAL AIRPORT AUTHORITY; C/W: ONTARIO
INTERNATIONAL AIRPORT AUTHORITY v. MAG US LOUNGE
MANAGEMENT, LLC
Costs was May 19, 2021. MAG further alleges that MAG had identified in its May 10,
2021 letter to OLAA that OIAA owed MAG $3,040,553 in Termination Costs. See
Compl. § 29. As described above, MAG claims that the parties’ dealings broke down and
that by the deadline on May 19, 2021, OIAA refused to pay MAG any amount for the
Termination Costs. On May 20, 2021, MAG “provided formal notice of OIAA’s breach
of section 2.4.1 of the Agreement” for failure to pay. Id. 4 31.
Accordingly, OIAA cannot meaningfully maintain that it lacked sufficient
notification that MAG had asserted the accrual of a claim against it.? See All. Fin. v. San
Francisco, 64 Cal. App. 4th at 647 (“A communication to the public entity that a claim
has accrued and that the claimant intends to enforce it suffices, even though the
communication fails to notify the public entity that a lawsuit is imminent.”). First, as
alleged in the complaint, OIAA waived any defense that MAG’s letter contained
deficiencies as a “claim as presented” by failing to notify MAG of those deficiencies
pursuant to Section 911. Indeed, OIAA not only failed to notify MAG that its letter
might have been deficient with respect to the requirements of the Government Claims
Act, OIAA refused to pay the amounts claimed in MAG’s letter and sent its own letter to
MAG on the same day stating that MAG had allegedly breached the parties’ Agreement.
Compl. { 31. Moreover, because a “claim for payment of money due on a contract
usually requires less investigation than is required for other forms of claims,” All Fin. v.

? At oral argument, counsel for O[AA emphasized that a “dispute” is not necessarily
synonymous with a “claim” for the purposes of the Government Claims Act, describing
the scenario of a contracting party disputing the cost of a change order. But compared to
counsel’s example, the circumstances of this case help to demonstrate when a dispute is
appropriately characterized as a claim. The parties’ relationship and the nature of the
claim are both governed by the specific contract the parties entered into. OIAA was fully
informed by the terms of the contract as to the scope of MAG’s claims for payment, and
as counsel for MAG explained, both parties appeared to already have retained counsel by
the time the May 20 notice of breach of contract letters were exchanged by the parties.
These alleged facts, along with those set forth above, convince the Court that the
underlying policy purposes of the Government Claims have been effectuated here.
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Case 2:21-cv-04909-CAS-RAO Document 51 Filed 02/13/23 Page 11o0f11 Page ID #:378
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES — GENERAL ‘O’
Case No. 2:21-cv-04909-CAS(RAOx): C/W: Date February 13, 2023
5:22-cv-01926-CAS(RAOx)
Title MAG US LOUNGE MANAGEMENT, LLC v. ONTARIO
INTERNATIONAL AIRPORT AUTHORITY; C/W: ONTARIO
INTERNATIONAL AIRPORT AUTHORITY v. MAG US LOUNGE
MANAGEMENT, LLC
San Francisco, 64 Cal. App. 4th at 644, and because MAG’s letter “performed the
function of a claim,” Foster v. McFadden, 30 Cal. App. 3d at 948, MAG additionally
substantially complied with the Government Claims Act.
V. CONCLUSION
In accordance with the foregoing, the Court DENIES defendant’s motion to
dismiss plaintiff's complaint.
IT IS SO ORDERED.
00 : 27
Initials of Preparer CMI

CV-90 (10/18) CIVIL MINUTES - GENERAL Page 11 of 11

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Source: Frix Law Library, https://www.frixlaw.com/law-library/cases/9982458. Public record. Not legal advice.