Gastelum v. Town Center Village II LLC

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UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF CALIFORNIA
FERNANDO GASTELUM,
Plaintiff,
v.
TOWN CENTER VILLAGE II, LLC,
Defendant.
Case No.: 3:25-cv-00745-JAH-LR
ORDER DENYING MOTION TO
STRIKE AND GRANTING IN PART
MOTION TO DISMISS
[ECF Nos. 13, 14]
Pending before the Court is Defendant Town Center Village II, LLC’s (“Defendant”)
Motion to Strike and Motion to Dismiss, filed pursuant to Federal Rules of Civil Procedure
12(f) and 12(b)(6). ECF Nos. 13, 14. Plaintiff Fernando Gastelum (“Plaintiff”) opposes
the motions. ECF Nos. 15, 16.
Plaintiff filed an amended complaint alleging claims under 1) Title III of the
Americans with Disabilities Act, 2) the Unruh Act, 3) the Disabled Persons Act (“DPA”),
and 4) Section 3294 of the California Civil Code for punitive damages based on malice and
oppression of the disabled, supplementing Plaintiff’s Unruh Act and DPA claims. 	ECF
No. 10 (“Amended Complaint” or “AC”). 	Defendant responded by filing the present
motions to 1) strike all references to punitive damages in the Amended Complaint and 2)
dismiss Plaintiff’s claim for malice and oppression.
For the reasons described below, the Court DENIES the Motion to Strike and
GRANTS the Motion to Dismiss with leave to amend.
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DISCUSSION
I. 	Motion to Strike Under Rule 12(f)
Defendant moves to strike all references to punitive damages in the Amended
Complaint pursuant to Rule 12(f). 	Fed. R. Civ. P. 12(f). 	Defendant argues the relief is
warranted based on Plaintiff’s failure to plead sufficient allegations to support his claim
for punitive damages under section 3294(a). Cal. Civ. Code § 3294(a).
In opposition, Plaintiff argues that Defendant fails to cite the correct legal standard
in support of its motion to strike and therefore fails to establish that relief is warranted.
A. 	Legal Standard
Federal Rule of Civil Procedure 12(f) permits a court to “strike from a pleading an
insufficient defense or any redundant, immaterial, impertinent, or scandalous matter.” Fed.
R. Civ. P. 12(f). The purpose of a motion to strike is to “avoid the expenditure of time and
money that must arise from litigating spurious issues by dispensing with those issues prior
to trial.” Whittlestone, Inc. v. Handi-Craft Co., 618 F.3d 970, 973 (9th Cir. 2010) (citation
omitted). A court should not grant a motion to strike “unless it is clear that the matter to
be stricken could have no possible bearing on the subject matter of the litigation.” Fluence
Energy, LLC v. M/V BBC Finland, 726 F. Supp. 3d 1086, 1098 (S.D. Cal. 2024). In ruling
on a motion to strike, the Court “must view the pleading under attack in the light most
favorable to the pleader.” Id.
Here, Defendant argues that Plaintiff fails to allege sufficient facts to support his
claim for punitive damages under California law. 	ECF No. 13-1 at 2–3. 	Specifically,
Defendant argues that Plaintiff’s allegations relating to malice and oppression are “entirely
conclusory” and that Plaintiff fails to allege any conduct showing that Defendant’s
corporate leaders or members acted with the requisite intent. 	Id. at 3. 	Thus, Defendant
moves the Court to strike all references to requests for punitive damages for failure to plead
sufficient allegations to support his claim. Id. at 2. As discussed below, the Court agrees
with Plaintiff that Defendant fails to cite to the correct standard under Rule 12(f).
Defendant’s argument makes no attempt to demonstrate that Plaintiff’s punitive
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damages allegations are redundant, immaterial, impertinent, or scandalous as required by
Rule 12(f). Rather, Defendant’s motion to strike Plaintiff's claims for punitive damages is
based entirely on the issues of whether Plaintiff sufficiently pled facts to show that there
was oppression or malice and whether Plaintiff sufficiently pled facts to show that
Defendant’s corporate leaders or members acted with the requisite intent.1
Notably, Defendant’s own cited authority establishes that a Rule 12(f) motion is not
the proper vehicle for challenging the sufficiency of punitive damages allegations. 	See
Kelley v. Corr. Corp. of Am., 750 F. Supp. 2d 1132, 1146 (E.D. Cal. 2010). In Kelley, the
defendants similarly moved to strike punitive damages allegations based on fraud,
oppression, or malice by challenging the sufficiency of the underlying factual allegations.
Kelley, 750 F. Supp. 2d at 1146. The court held that the proper vehicle for challenging the
sufficiency of factual allegations is Rule 12(b)(6), not Rule 12(f), and proceeded to address
the substance of the motion to strike as if it were pled pursuant to Rule 12(b)(6). 	Id.
(explaining “where a motion is in substance a Rule 12(b)(6) motion, but is incorrectly
denominated as a Rule 12(f) motion, a court may convert the improperly designated Rule
12(f) motion into a Rule 12(b)(6) motion”).
In light of the foregoing, this Court finds that Defendant’s arguments “challenging
the sufficiency of Plaintiff’s factual allegations without any argument that the claims are
redundant, immaterial, impertinent or scandalous” are better suited for a Rule 12(b)(6)
1 Defendant also argues that “[a] motion to strike is often the preferred vehicle for
dismissing a prayer for relief such as punitive damages.” 	ECF No. 13-1 at 2 (citing to
Wilkerson v. Butler, 229 F.R.D 166, 172 (E.D. Cal. 2005)). However, Wilkerson states that
a “motion to strike is appropriate to address requested relief, such as punitive damages,
which is not recoverable as a matter of law,” not that it is the preferred vehicle. Wilkerson,
229 F.R.D at 172 (emphasis added). In any event, Wilkerson was decided prior to the Ninth
Circuit’s ruling in Whittlestone which expressly held that “Rule 12(f) does not authorize
district courts to strike claims for damages on the ground that such claims are precluded as
a matter of law.” 618 F.3d at 975. Thus, to the extent Wilkerson conflicts with the holding
in Whittlestone, this Court follows the Ninth Circuit’s precedent.
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motion, not a Rule 12(f) motion. 	Kelley, 750 F. Supp. 2d at 1146; see also Whittlestone,
618 F.3d at 973 (citing Rutman Wine Co. v. E. & J. Gallo Winery, 829 F.2d 729, 738 (9th
Cir. 1987) (“The purpose of [Rule] 12(b)(6) is to enable defendants to challenge the legal
sufficiency of complaints....”)); Haney, Inc. v. Axium BioResearch, No. 3:23-cv-01990-
RBM-JLB, 2025 WL 2734218, at *17-18 (S.D. Cal. Sept. 25, 2025) (denying a motion to
strike punitive damages for failure to state a claim for similar reasons). 	However, given
that Defendant concurrently filed a Motion to Dismiss Plaintiff’s punitive damages claim
based on substantially the same arguments, the Court finds it appropriate to address the
substance of the instant motion to strike together with the arguments in Defendant’s motion
to dismiss pursuant to the standard of review under Rule 12(b)(6).
Accordingly, the Court DENIES Defendant’s motion to strike.
II. 	Motion to Dismiss Under Rule 12(b)(6)
Defendant moves to dismiss Plaintiff’s fourth claim seeking punitive damages for
malice and oppression of the disabled pursuant to Rule 12(b)(6). 	Fed. R. Civ. P. 12(6).
Defendant argues that dismissal is proper because 1) California courts do not recognize a
cause of action for malice and oppression and 2) Plaintiff fails to plead sufficient facts to
support his claim for punitive damages under section 3294(a). Cal. Civ. Code § 3294(a).
Specifically, Defendant argues that to the extent Plaintiff seeks punitive damages based on
violation of the Unruh Act or DPA, Plaintiff fails to allege facts showing that Defendant
acted with intention, and much less with malice and oppression. ECF No. 14 at 3.
In opposition, Plaintiff argues that his request for punitive damages is a remedy, not
a claim, subject to dismissal and that his prayer for relief was adequate under the liberal
pleading standard of Rule 9(b). Fed. R. Civ. P. 9(b); see generally ECF No. 16.
A. 	Legal Standard
A motion to dismiss under Rule 12(b)(6) tests the legal sufficiency of the complaint.
Navarro v. Block, 250 F.3d 729, 732 (9th Cir. 2001). 	To survive a 12(b)(6) motion, “a
complaint must contain sufficient factual matter, accepted as true, to ‘state a claim to relief
that is plausible on its face.’” 	Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell
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Atlantic Corp. v. Twombly, 550 U.S. 544, 570 (2007)). A claim is facially plausible when
the factual allegations permit “the court to draw the reasonable inference that the defendant
is liable for the misconduct alleged.” 	Id. 	In other words, “the non-conclusory factual
content, and reasonable inferences from that content, must be plausibly suggestive of a
claim entitling the plaintiff to relief.” Moss v. U.S. Secret Service, 572 F.3d 962, 969 (9th
Cir. 2009) (citing Iqbal, 556 U.S. at 678). Although the factual allegations must be more
than speculative, a well-pleaded complaint may proceed even if the likelihood of recovery
is remote. Twombly, 550 U.S. at 555–56.
When ruling on a 12(b)(6) motion, courts must accept as true the facts alleged in the
complaint and draw all inferences in the light most favorable to the non-moving party. See
Iqbal, 556 U.S. at 678; see also Moss, 572 F.3d at 969. “Threadbare recitals of the elements
of a cause of action, supported by mere conclusory statements, do not suffice,” and courts
need not accept as true legal conclusions cast as factual allegations. Iqbal, 556 U.S. at 678.
(citing Twombly, 550 U.S. at 555). “Determining whether a complaint states a plausible
claim for relief [is] . . . a context-specific task that requires the reviewing court to draw on
its judicial experience and common sense.” Id. at 679.
The pleadings of a pro se plaintiff “must be held to less stringent standards than
formal pleadings drafted by lawyers.” Hebbe v. Pliler, 627 F.3d 338, 342 (9th Cir. 2010)
(citing Erickson v. Pardus, 551 U.S. 89, 94 (2007) (“Iqbal incorporated the Twombly
pleading 	standard 	and 	Twombly 	did 	not 	alter courts’ 	treatment 	of 	pro 	se 	filings;
accordingly, we continue to construe pro se filings liberally when evaluating them under
Iqbal.”)). Although the pleadings are still evaluated under Iqbal and Twombly, courts are
obligated, “particularly in civil rights cases, to construe the pleadings liberally and to afford
the [pro se] petitioner the benefit of any doubt.” Id.
B. 	Independent Claim for Malice and Oppression
The Court agrees that malice and oppression do not constitute an independent cause
of action under California law. See Cal. Civ. Code § 3294. Rather, they are predicates for
a punitive damages remedy under section 3294.
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Here, although Plaintiff styles his request for punitive damages under section 3294
as a separate claim for malice and oppression, the claim clearly states that the claim
supplements counts two and three. AC at 7. This means that, rather than standing on its
own, Plaintiff’s request for punitive damages under section 3294 depends on Plaintiff
succeeding on his Unruh Act and DPA claims at trial. Thus, notwithstanding that the claim
for malice and oppression appears as a separate claim in Plaintiff’s Amended Complaint,
the Court finds the claim to be a request for punitive damages under section 3294, pursuant
to Plaintiff’s claims under the Unruh Act and the DPA.
Accordingly, Plaintiff must properly allege a prayer for punitive damages for malice
and oppression under the applicable pleading standard, independently from the sufficiency
of the allegations for the underlying causes of action under the Unruh Act and the DPA.
In considering the sufficiency of Plaintiff’s allegations for malice or oppression under
section 3294, the Court will also consider the factual allegations supporting Plaintiff’s
Unruh Act and DPA claims to determine whether dismissal under Rule 12(b)(6) is proper.
C. 	Applicable Pleading Standard
The Court holds, and the parties agree, that this Court should apply federal
procedural rules given that the matter proceeds before this Court based on diversity
jurisdiction. 	See Clark v. Allstate Ins. Co., 106 F. Supp. 2d 1016, 1019 (S.D. Cal. 2000)
(“It is well-established that federal courts sitting in diversity must apply state substantive
law and federal procedural rules.”). 	The Court will now consider whether the Iqbal and
Twombly pleading standard or the Rule 9(b) standard is proper to assess the sufficiency of
Plaintiff’s prayer for punitive damages under Rule 12(b)(6).
In support of his argument that the Court should apply the Rule 9(b) pleading
standard, Plaintiff cites Gastelum v. Starbucks Corp. (Starbucks), No. 5:22-cv-08149 (N.D.
Cal. Nov. 27, 2024), in which he is a party and where the court applied the “liberal pleading
standard of Rule 9(b)” to hold that plaintiff stated a claim for punitive damages 	under
section 3294. 	See ECF No. 16 at 3–4 (explaining that “under federal pleading standards,
malice, intent, knowledge, and other conditions of a person’s mind may be alleged
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generally” and holding that “Plaintiff states a claim for punitive damages for his state law
claims because his third amended complaint clearly requests punitive damages and makes
conclusory assertions of intentional and malicious misconduct”) (citing Clark, 106 F. Supp.
2d 1019–20). Although Defendant does not directly address this argument, the Court finds
Clark unavailing because it was decided prior to the Supreme Court’s decision in Twombly
in 2007 and in Iqbal in 2009. 106 F. Supp. 2d at 1019.
As an initial matter, this Court acknowledges that district courts within the Ninth
Circuit are split on whether the Iqbal and Twombly pleading standards can be used to
dismiss a prayer for punitive damages. 	Compare Kelley, 750 F. Supp. at 1146–47
(dismissing punitive damages claim based on the Iqbal and Twombly pleading standards)
with Rees v. PNC Bank, N.A., 308 F.R.D. 266, 273 (N.D. Cal. 2015) (adopting the Rule
9(b) standard and stating “in federal court, a plaintiff may include a short and plain prayer
for punitive damages that relies entirely on unsupported and conclusory averments of
malice or fraudulent intent”) (citing Clark, 106 F. Supp. 2d at 1019).
However, this Court has previously held that the Iqbal and Twombly pleading
requirements apply to a request for punitive damages under California law “because
Federal Rule of Civil Procedure 8(a), which dictates federal pleading standards, applies to
both the statement of the claim and the demand for relief sought, applying Twombly and
Iqbal to a claim for punitive damages harmonizes Supreme Court case law with the Federal
Rules of Civil Procedure.” Pa. Transformer Tech., Inc. v. Charter Oak Fire, No. 3:22-cv-
00611, 2023 WL 2415163, at *2 (S.D. Cal. Mar. 8, 2023).
This Court finds no reason to depart from its prior holding. See also Kelley, 750 F.
Supp. at 1147 (“T]he application of the pleading standards set forth in Twombly and Iqbal
to claims for punitive damages under California law serves the salutary purpose of
harmonizing 	standards 	applicable 	to 	state 	and 	federal 	proceedings 	while 	avoiding
unnecessary pleading distinctions between consequential and punitive damages claims in
diversity proceedings in federal court.”). Accordingly, the Court will evaluate Plaintiff’s
punitive damages allegations under the Twombly and Iqbal standards.
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D. 	Allegations for Punitive Damages Under Cal. Civ. Code § 3294
Under California Civil Code § 3294, “[i]n an action for the breach of an obligation
not arising from contract, where it is proven by clear and convincing evidence that the
defendant has been guilty of oppression, fraud, or malice, the plaintiff, in addition to the
actual damages, may recover damages for the sake of example and by way of punishing
the defendant.” Cal. Civ. Code § 3294(a). Malice is defined as “conduct which is intended
by the defendant to cause injury to the plaintiff or despicable conduct which is carried on
by the defendant with a willful and conscious disregard of the rights or safety of others.”
Id. § 3294(c)(1). 	Oppression is “despicable conduct that subjects a person to cruel and
unjust hardship in conscious disregard of that person's rights.” 	Id. 	§ 3294(c)(2).
Despicable conduct is defined as “conduct that is so vile, base, contemptible, miserable,
wretched or loathsome that it would be looked down upon and despised by ordinary decent
people.” 	Lackner v. North, 135 Cal. App. 4th 1188, 1210 (2006) (internal citations and
quotations omitted).
“Corporations are legal entities which do not have minds capable of recklessness,
wickedness, or intent to injure or deceive. An award of punitive damages against a
corporation therefore must rest on the malice of the corporation's employees.” 	Cruz v.
Homebase, 83 Cal. App. 4th 160, 167 (2000). Section 3294(b) provides that an employer
cannot be held liable for employee acts unless “the employer had advance knowledge of
the unfitness of the employee and employed him or her with a conscious disregard of the
rights or safety of others or authorized or ratified the wrongful conduct for which the
damages are awarded or was personally guilty of oppression, fraud, or malice.” Cal. Civ.
Code § 3294(b). 	“The advance knowledge and conscious disregard, authorization,
ratification or act of oppression, fraud, or malice must be on the part of an officer, director,
or managing agent of the corporation.” 	Id. 	Plaintiff must prove ratification by clear and
convincing evidence. Barton v. Alexander Hamilton Life Ins. Co., 110 Cal. App. 4th 1640,
1644 (2003).
Here, Plaintiff’s request for punitive damages is supported by two allegations: 1)
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“By its continuing and unrelenting discrimination against the disabled, including Plaintiff,
Defendant is and has been guilty of oppression and malice;” 2) “Defendant’ [sic] malice
and oppression of the disabled are intentional, premeditated, and specifically designed as
a marketing strategy.” 	AC at 7. 	These conclusory statements do not allege any facts
describing discriminatory conduct or intent, nor do they explain how the conduct actually
alleged—Plaintiff arrived at a Subway store “own[ed], operate[d], lease[d], or lease[d] to
a third party” by Defendant—qualifies under the standard for malice and oppression.
Plaintiff also fails to identify any officer, director, or managing agent of Defendant who
participated in malicious or pressive conduct, consciously disregarded the rights of others,
or ratified another employee’s conduct in doing so, as required by § 3294(b). See Cruz, 83
Cal. App. 4th at 167–68.
In addition, Plaintiff’s allegation that “intentional segregation and discrimination of
the type alleged here, and indeed any segregation and discrimination against any member
of a protective [sic] class, is malicious or oppressive as a matter of law” is not supported
by facts or California law. 	Id. 	Discrimination against a protected class is not per se
malicious or oppressive and Plaintiff must allege sufficient facts to satisfy the requirements
of the statute. See Cal. Civ. Code § 3294; Colucci v. T-Mobile USA, Inc., 48 Cal. App. 5th
442, 454–55 (2020) (holding that there has to be clear and convincing evidence that the
actions are malicious or oppressive).
Finally, Plaintiff’s underlying state law claims also lack factual support. Plaintiff’s
Unruh Act claim consists of a conclusory allegation that “[d]efendant’s store violated the
Unruh Act by denying Plaintiff’s rights to full and equal use.” 	Id. at 5. 	Similarly,
Plaintiff’s DPA claim relies on threadbare legal conclusions that “Defendants [sic] have
violated the DPA by denying Plaintiff equal access to its public accommodation on the
basis of his disability as outlined above” and “Plaintiff has been aggrieved by Defendant’s
non-compliance with accessibility laws.” Id. at 6–7.
Based 	on 	the 	foregoing, 	the 	Court 	finds 	that 	Plaintiff 	fails 	to 	allege 	facts
demonstrating that Defendant’s conduct satisfies the definition of malice and oppression
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under § 3294(c). Given the lack of factual allegations that, for example, identify such an
officer, director, or managing agent or that plausibly allege why the acts qualify as malice
or oppression, the Court finds that Plaintiff fails to state a plausible claim for punitive
damages based on malice and oppression.
Accordingly, the Court GRANTS Defendant’s motion to dismiss Plaintiff’s claim
for punitive damages for malice and oppression.
CONCLUSION
Accordingly, the Court HEREBY ORDERS:
1. Defendant’s Motion to Strike is DENIED.
2. Defendant’s Motion to Dismiss due to Plaintiff’s failure to sufficiently allege a
prayer for relief supporting punitive damages under a malice and oppression
theory against corporate Defendant under Iqbal and Twombly is GRANTED.
3. The Court GRANTS Plaintiff forty-five (45) days from the date of this Order to
file an Amended Complaint which cures the aforementioned deficiencies.
Plaintiff is cautioned, however, that should he choose to file an Amended
Complaint, it must be complete by itself, comply with the Federal Rules of Civil
Procedure, including Rule 8(a), and that any claim not re-alleged will be
considered waived. See CivLR 15.1; Hal Roach Studios, Inc. v. Richard Feiner
& Co., Inc., 896 F.2d 1542, 1546 (9th Cir. 1989) (“[A]n amended pleading
supersedes the original”); Lacey v. Maricopa Cnty., 693 F.3d 896, 928 (9th Cir.
2012) (noting that claims dismissed with leave to amend which are not re-alleged
in an amended pleading may be considered “waived if not replied”).
IT IS SO ORDERED.
DATED: March 24, 2026
_________________________________
JOHN A. HOUSTON
UNITED STATES DISTRICT JUDGE
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