Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caed-2_12-cv-02910/USCOURTS-caed-2_12-cv-02910-6/pdf.json

Nature of Suit Code: 190
Nature of Suit: Other Contract Actions
Cause of Action: 28:1441 Petition for Removal

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UNITED STATES DISTRICT COURT 

EASTERN DISTRICT OF CALIFORNIA 

CLEAR CONNECTION 

CORPORATION, a California Corporation

Plaintiff,

v.

COMCAST CABLE 

COMMUNICATIONS MANAGEMENT, 

LLC, a Delaware limited liability company

and DOES 1 through 30 inclusive,

Defendant.

No. 2:12-cv-02910-TLN-CKD

ORDER

COMCAST CABLE COMMUNICATION 

MANAGEMENT, LLC,

Counterclaimant,

v.

CLEAR CONNECTION 

CORPORATION, a California corporation, 

CLEAR CONNECTION, LLC, an Arizona 

limited liability company, and KURK 

MOODY, an individual,

Counterdefendants.

This matter is before the Court on Defendant and Counterclaimant Comcast Cable 

Communications Management, LLC’s (“Comcast”) motion for judgment on the pleadings under 

Federal Rule of Civil Procedure 12(c) (“Rule 12(c)”). (ECF No. 54.) Plaintiff and CounterDefendant Clear Connection Corporation (“Clear Connection”) opposes the motion. (ECF No. 

55.) Clear Connection also moves for judgment on the pleadings under Rule 12(c). (ECF No. 

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56.) Comcast opposes the motion. (ECF No. 59.) For the reasons set forth below, Comcast’s 

motion is GRANTED IN PART AND DENIED IN PART and Clear Connection’s motion is 

DENIED.1 

I. BACKGROUND

Clear Connection is a cable installation company incorporated in California. (Pl.’s First 

Am. Compl., ECF 42 at ¶ 1.) This matter arises out of Clear Connection’s allegations that 

Comcast terminated its commercial agreement in which Clear Connection was to provide cable 

technician services to Comcast customers. Comcast requires every company that wants to 

perform cable installation work for Comcast to sign a Preferred Vendor Agreement (“PVA”) or a 

substantially similar document. (ECF No. 42 at ¶ 11.) Clear Connection entered into a PVA with 

Comcast that was periodically supplemented by various Statements of Work (“SOW”). (ECF No. 

42 at ¶ 11–12, 28.) The PVA between Comcast and Clear Connection has substantially the same 

terms as agreements Comcast created with other cable installers. (ECF No. 42 at ¶ 12.) 

The PVA contains a list of requirements with which cable installers must comply. (ECF 

No. 42 at ¶ 13.) Clear Connection notes that the PVA expressly states, “[Comcast] makes no 

representation that...the Contractor will receive any Work pursuant to this Agreement.” (ECF 

No. 42 at ¶ 14.) It also contains a statement that, “UNDER NO CIRCUMSTANCES OR LEGAL 

THEORY ... SHALL [Comcast] BE LIABLE TO CONTRACTOR FOR ANY LOSS PROFITS, 

LOSS OF OPPORTUNITY OR ANY OTHER SPECIAL, PUNITIVE, INDIRECT, OR 

CONSEQUENTIAL DAMAGES...SUFFERED BY THE CONTRACTOR ARISING IN 

CONNECTION WITH...THIS AGREEMENT.” (ECF No. 42 at ¶ 15.) The PVA requires Clear 

Connection to “provide sufficient labor, transportation, tools and equipment necessary to perform 

all of the Work required by [Comcast]” (ECF No. 42 at ¶ 17); provide “Key Personnel,” dictated 

by Comcast, who “are required to spend ‘eighty-five percent (85%) of their professional efforts on 

behalf of [Clear Connection] to effectuate [Clear Connection’s] obligations under this 

Agreement” (ECF No. 42 at ¶ 18 (emphasis in original)); “obtain all necessary licenses and 

 

1

 Clear Connection’s First Amended Complaint also named O.C. Communications as a co-defendant in this 

action. (ECF No. 42.) The Court subsequently dismissed O.C. Communications from the action as an improperly 

joined party. (ECF No. 49.) 

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Permits to perform the Work within the Community’ at its expense” (ECF No. 42 at ¶ 20 

(emphasis in original)); and “supply...’its own warehouse and office to house the necessary 

personnel, materials, tools, vehicles, equipment and other items required to manage and complete 

the Work[,]’” (ECF No. 42 at ¶ 21 (emphasis in original)). It further includes a nondisparagement clause and prohibits Clear Connection from “hir[ing], recruit[ing] or solicit[ing] 

for employment[] any Company employee or representative...during the term and for one (1) 

year thereafter[.]” (ECF No. 42 at ¶ 22–23 (emphasis in original).) The PVA requires Clear 

Connection to keep $7.5 million dollars in insurance coverage as well. (ECF No. 42 at ¶ 24.) 

The SOW provided that Comcast “assigned territories to cable installers and laid out the 

amount Comcast would pay for various cable installation services.” (ECF No. 42 at ¶ 28.) Under 

the SOW, Comcast required Clear Connection to maintain “Key Personnel” at its own expense 

and included “chargeback criteria...allow[ing] Comcast to fine installers for being late to 

installation appointments and for ‘non-compliant quality inspected jobs.’” (ECF No. 42 at ¶ 29 

(emphasis in original).) Comcast also required that equipment be inventoried and, if unaccounted 

for, be charged to the cable installer. (ECF No. 42 at ¶ 29.) In order to receive work 

assignments, Comcast required installers to call each morning. (ECF No. 42 at ¶ 30.) 

On or about September 2009, Comcast announced a contractor realignment plan. (ECF 

No. 42 at ¶ 34.) Under this plan, Comcast informed Clear Connection that its sole service area 

would be Fresno and instructed Clear Connection to shut down its service operations outside of 

Fresno. (ECF No. 42 at ¶¶ 37–38.) Clear Connection states that, at the time that the contractor 

realignment was announced, there were multiple cable installation companies working in multiple 

markets that openly competed. (ECF No. 42 at ¶ 34.) Clear Connection alleges that the 

realignment plan had the effect of “actively coerc[ing] cable installers to trade key personnel, 

break leases, ...trade fleets of vehicles and take over each other’s equipment.” (ECF No. 42 at ¶ 

36.) Clear Connection states that Comcast continually and repeatedly promised Clear Connection 

that, although it was being forced into the single market of Fresno, Comcast would make up for 

Clear Connection’s loss of territory by an increased volume of work. (ECF No. 42 at ¶ 40.) 

Clear Connection further alleges that it “complied with Comcast’s demands at great expense to its 

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business and its employees, all while relying on Comcast’s promises that clear Connection would 

receive substantial work in Fresno that would more than make up for the costs of shuttering its 

Sacramento operations.” (ECF No. 42 at ¶ 41.) 

Clear Connection contends that Comcast’s co-defendant, O.C. Communications, was, in 

reality, Comcast’s handpicked installer for the Sacramento area and ultimately the installer for the 

Fresno work that Comcast had promised to Clear Connection. (ECF No. 42 at ¶ 43.) Clear 

Connection further contends that “O.C. Communications colluded with Comcast to run Clear 

Connection out of business.” (ECF No. 42 at ¶ 44.) Clear Connection alleges that “[a]fter 

Defendant O.C. Communications received all the benefits of Clear Connection’s prior operations, 

Comcast fired Clear Connection.” (ECF No. 42 at ¶ 45.) 

Prior to Comcast’s notification that it was terminating its contract with Clear Connection, 

O.C. Communications announced it was hiring and had an ad in the Fresno Bee. (ECF No. 42 at 

¶ 47.) Clear Connection alleges that Comcast “intentionally and maliciously used its overbearing 

market presence to force Clear Connection to give up its business and its employees and put itself 

in a financially perilous situation.” (ECF No. 42 at ¶ 48.) Clear Connection further alleges that 

O.C. Communications was complicit in Comcast’s alleged plan, usurping Clear Connection’s 

operations, employees, and market share. (ECF No. 42 at ¶ 49.) Clear Connection contends that 

this plan gave O.C. Communications “a virtual monopoly on cable installation services in 

Sacramento and Fresno.” (ECF No. 42 at ¶ 49.) 

Clear Connection filed its complaint in California Superior Court for the County of 

Sacramento on August 6, 2012. Comcast removed the matter to this court on November 30, 

2012, on the basis of diversity of citizenship. (See Def.’s Notice of Removal, ECF 1.) On August 

1, 2013, Comcast filed a motion for judgment on the pleadings requesting dismissal of all claims 

Clear Connection asserted in its original Complaint. (ECF Nos. 30, 31.) On December 4, 2013, 

this Court granted the motion and dismissed Clear Connection’s complaint without prejudice. 

(ECF No. 39 at 11.) On December 24, 2013, Clear Connection filed a First Amended Complaint 

(“FAC”). (ECF No. 42.) On March 17, 2014, Comcast filed its answer to the FAC and reasserted its counterclaims. (ECF No. 50.) Comcast then filed the instant motion on May 23, 

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2014. (ECF No. 54.) On July 17, 2014, Clear Connection filed a counter-motion for judgment on 

the pleadings. (ECF No. 56.) 

II. LEGAL STANDARD

 Federal Rule of Civil Procedure 12(c) (“Rule 12(c)”) provides that “[a]fter the pleadings 

are closed — but early enough not to delay trial — a party may move for judgment on the 

pleadings.” FED. R. CIV. P. 12(c). Moreover, Rule 12(h)(2) provides in relevant part that a 

defense of failure to state a claim upon which relief can be granted may be made by motion for 

judgment on the pleadings. FED. R. CIV. P. 12(h)(2). When considering a motion for judgment 

on the pleadings presenting a defense of failure to state a claim upon which relief can be granted, 

a court should employ those standards normally applicable to a motion to dismiss pursuant Rule 

12(b)(6). Enron Oil Trading & Transp. Co. v. Walbrook Ins. Co., Ltd., 132 F.3d 526, 528-29 (9th 

Cir. 1997); 5B Wright & Miller, Federal Practice and Procedure, Civil § 1368 at 515-16 (3d ed. 

2007).

On a motion to dismiss, the factual allegations of the complaint must be accepted as true. 

Cruz v. Beto, 405 U.S. 319, 322 (1972). A court is bound to give plaintiff the benefit of every 

reasonable inference to be drawn from the “well-pleaded” allegations of the complaint. Retail 

Clerks Int’l Ass’n v. Schermerhorn, 373 U.S. 746, 753 n.6 (1963). A plaintiff need not allege 

“‘specific facts’ beyond those necessary to state his claim and the grounds showing entitlement to 

relief.” Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 570 (2007). “A claim has facial 

plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable 

inference that the defendant is liable for the misconduct alleged.” Ashcroft v. Iqbal, 556 U.S. 

662, 678 (2009) (citing Twombly, 550 U.S. at 556). 

Nevertheless, a court “need not assume the truth of legal conclusions cast in the form of 

factual allegations.” United States ex rel. Chunie v. Ringrose, 788 F.2d 638, 643 n.2 (9th Cir. 

1986). While Rule 8(a) does not require detailed factual allegations, “it demands more than an 

unadorned, the defendant-unlawfully-harmed-me accusation.” Iqbal, 556 U.S. at 678. A 

pleading is insufficient if it offers mere “labels and conclusions” or “a formulaic recitation of the 

elements of a cause of action.” Twombly, 550 U.S. at 555; see also Iqbal, 556 U.S. at 678 

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(“Threadbare recitals of the elements of a cause of action, supported by mere conclusory 

statements, do not suffice.”). Moreover, it is inappropriate to assume that the plaintiff “can prove 

facts that it has not alleged or that the defendants have violated the . . . laws in ways that have not 

been alleged[.]” Associated Gen. Contractors of Cal., Inc. v. Cal. State Council of Carpenters, 

459 U.S. 519, 526 (1983). 

Ultimately, a court may not dismiss a complaint in which the plaintiff has alleged “enough 

facts to state a claim to relief that is plausible on its face.” Iqbal, 556 U.S. at 678 (quoting 

Twombly, 550 U.S. at 570). Only where a plaintiff has failed to “nudge[] [his or her] claims . . . 

across the line from conceivable to plausible[,]” is the complaint properly dismissed. Id. at 680. 

While the plausibility requirement is not akin to a probability requirement, it demands more than 

“a sheer possibility that a defendant has acted unlawfully.” Id. at 678. This plausibility inquiry is 

“a context-specific task that requires the reviewing court to draw on its judicial experience and 

common sense.” Id. at 679. A party asserting claims for fraud must also meet the heightened 

pleadings standard set forth in Rule 9(b), which provides that, “[i]n alleging fraud or mistake, a 

party must state with particularity the circumstances constituting fraud or mistake. Malice, intent, 

knowledge, and other conditions of a person’s mind may be alleged generally.” FED. R. CIV. P. 

9(b). 

If a complaint fails to state a plausible claim, “[a] district court should grant leave to 

amend even if no request to amend the pleading was made, unless it determines that the pleading 

could not possibly be cured by the allegation of other facts.” Lopez v. Smith, 203 F.3d 1122, 1130 

(9th Cir. 2000) (en banc) (quoting Doe v. United States, 58 F.3d 484, 497 (9th Cir. 1995)); see 

also Gardner v. Marino, 563 F.3d 981 (9th Cir. 2009) (finding no abuse of discretion in denying 

leave to amend when amendment would be futile). Although a district court should freely give 

leave to amend when justice so requires under Rule 15(a)(2), “the court’s discretion to deny such 

leave is ‘particularly broad’ where the plaintiff has previously amended its complaint[.]” 

Ecological Rights Found. v. Pac. Gas & Elec. Co., 713 F.3d 502, 520 (9th Cir. 2013) (quoting 

Miller v. Yokohama Tire Corp., 358 F.3d 616, 622 (9th Cir. 2004)). 

//

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III. ANALYSIS

A. Comcast’s Motion for Judgment on the Pleadings 

i. Count I: Cartwright Act 

Clear Connection alleges in its first cause of action that Comcast violated the Cartwright 

Act, Cal. Bus. & Prof. Code § 16700, et seq., by forming an improper combination “with the 

intent to create local cable installer monopolies, fix prices, and maliciously and fraudulently 

destroy Clear Connection’s business.” (ECF No. 42 at ¶ 50–56.) Comcast argues that this cause 

of action should be dismissed because the FAC has failed to: 1) claim a market injury; 2) make 

any factual allegations to support the formation of a conspiracy between Comcast and O.C. 

Communications; and 3) demonstrate that Comcast made any “wrongful acts” as part of the 

conspiracy. (Mem. in Supp. of Def.’s Mot. for J. on the Pleadings, ECF No. 54-1 at 12–17.) 

A successful action under the Cartwright Act requires a plaintiff to allege: 1) formation 

and operation of a conspiracy; 2) wrongful acts done pursuant to thereto; and 3) damage resulting 

from such acts. Marsh v. Anesthesia Servs. Med. Grp., 200 Cal. App. 4th. 480, 495 (2011). “An 

antitrust claim must plead the formation and operation of the conspiracy and the illegal acts done 

in furtherance of the conspiracy. California requires a ‘high degree of particularity’ in the 

pleading of Cartwright Act violations, and therefore generalized allegations of antitrust violations 

are usually insufficient.” Freeman v. San Diego Ass’n of Realtors, 77 Cal. App. 4th 171, 196 

(1999). Comcast argues that Clear Connection has failed to meet this burden. The Court 

disagrees. 

a. Allegations of Market Injury 

First, Comcast asserts that Clear Connection has alleged an improper combination that 

forms a vertical restraint in trade, which requires a plaintiff to allege an injury to the market. 

(ECF No. 54-1 at 13.) Comcast argues that Clear Connection “has not alleged (and could not 

amend to allege) injury to the market.” (ECF No. 54-1 at 13.) In response, Clear Connection first 

maintains that Comcast’s actions constitute a type of vertical price restraint that is illegal per se, 

rather than subject to a standard known as the “rule of reason” and therefore Clear Connection 

need not present facts to show an injury to the market. (ECF No. 55 at 10–11.) Clear Connection 

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further states that its complaint provides sufficient support for a reasonable inference that 

Comcast’s actions constitute a per se illegal trade restraint where Comcast allegedly restricted 

trade by “divid[ing] its territories to create local monopolies, cramm[ing] down prices on 

installers, and demand[ing] and dictat[ing] the prices for its services.” (ECF No. 55 at 11.) In the 

alternative, Clear Connection argues that, even if the Court finds that the rule of reason applies, it 

cannot decide the reasonableness question at this stage of the litigation because it is an issue for 

the trier of fact. (ECF No. 55 at 11–12.) 

Clear Connection asserts facts consistent with an exclusive dealing arrangement resulting 

in vertical price restraint, wherein two entities at different levels of production and distribution 

enter into an exclusive arrangement in an effort to control the market’s price for service. Pecover 

v. Electronics Arts Inc., 633 F. Supp. 2d 976, 983 (N.D. Cal. 2009) (internal citation omitted). 

The Court finds that the rule of reason applies to this type of alleged trade restriction. “California 

courts have determined that vertical restraints of trade, such as exclusive dealing arrangements, 

can violate the Cartwright Act, though they are not illegal per se.” Id. Therefore, the rule of 

reason must apply. Id. (“The law conclusively presumes manifestly anticompetitive restraints of 

trade to be unreasonable and unlawful, and evaluates other restraints under the rule of reason.”). 

Generally, a rule of reason analysis requires that the “finder of fact must decide whether 

the questioned practice imposes an unreasonable restraint on competition, taking into account a 

variety of factors, including specific information about the relevant business, its condition before 

and after the restraint was imposed, and the restraint’s history, nature, and effect.” State Oil Co. 

v. Khan, 522 U.S. 3, 10, 118 S. Ct. 275, 279, 139 L. Ed. 2d 199 (1997). However, the Court finds 

that its decision to apply the rule of reason to this claim does not prevent the Court from making a 

determination on the viability of Clear Connection’s claim at this stage of the litigation. Marsh, 

200 Cal. App. 4th. at 492–499 (upholding a Rule12(b)(6) dismissal of a Cartwright Act claim 

using rule of reason analysis). While Clear Connection is correct that the trier of fact must 

determine the ultimate viability of a trade restraint under the rule of reason, that requirement does 

not prevent the Court from determining if Clear Connection’s claim has met the threshold 

pleading requirement under 12(c). 

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Ultimately, the allegations put forth by Clear Connection are sufficient to support its cause 

of action at this stage. “The unlawful combination or conspiracy must be alleged with specificity 

... [C]ontracts, combinations or conspiracies in restraint of ...trade or commerce cannot be 

alleged generally in the words of the statute but ... facts must be set forth which indicate the 

existence of such contracts, combinations or conspiracies.” Freeman, 77 Cal. App. 4th at 196. 

Clear Connection clearly identifies the entities, Comcast and O.C. Communications, and the 

market, cable service providers and installers in California regions, including Sacramento and 

Fresno. (ECF No. 42 at ¶¶ 6–8, 49.) Clear Connection’s complaint put forth an allegation of a 

specific “contractor realignment plan” that permitted Comcast to “create local monopolies for 

particular cable installers.” (ECF No. 42 at ¶ 31.) Clear Connection further alleged that Comcast 

used its overwhelming market share, along with its restrictive PVAs, to push down market prices 

and dictate other business terms. (ECF No. 42 at ¶¶ 26, 27, 35, 36, 49.) These allegations are 

sufficient to meet the requirements under Rule 12(c). 

b. Allegations of Conspiracy 

Second, Comcast argues that Clear Connection has failed to allege sufficient facts to 

support the operation of a conspiracy between Comcast and O.C. Communications. (ECF No. 

54-1 at 14–16.) Comcast maintains that Clear Connection has made “no allegations regarding the 

individuals involved in a conspiracy, the date(s) or location(s) of any communications or 

meetings among the alleged conspirators, the nature of any such communications, or any actions 

taken in furtherance of the alleged conspiracy.” (ECF No. 54-1 at 15.) The Court finds 

Comcast’s characterization to be inaccurate and hereby denies Comcast’s motion for judgment on 

this issue. 

The Cartwright Act requires a plaintiff to demonstrate an unlawful trust as “a combination 

of capital, skill or actions by two or more persons” for enumerated purposes that restrain trade. 

Cal. Bus. & Prof. Code § 16720. At this stage, a complaint alleging an unlawful trust, or 

conspiracy, must allege facts sufficient “to give a defendant seeking to respond to allegations of a 

conspiracy an idea of where to begin.” Kendall v. Visa U.S.A., Inc., 518 F.3d 1042, 1047 (9th 

Cir. 2008). As Comcast points out, those facts may include a “specific time, place, or person 

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involved in the alleged conspiracy.” (ECF No. 54-1 at 15 (citing Kendall, 518 F.3d at 1047).) 

However, “identifying a written agreement or even a basis for inferring a tacit agreement” may be 

sufficient where the underlying allegation is a specific one. Kendall, 518 F.3d at 1047.

Using this standard, the Court finds that Clear Connection has alleged sufficient facts “to 

give a defendant seeking to respond to allegations of a conspiracy an idea of where to begin.” Id. 

Clear Connection identifies the “contractor realignment plan” as the source of the conspiracy and 

September 2009 as the approximate date of its inception. (ECF No. 42 at ¶ 31.) Clear 

Connection explains its allegations that the realignment plan effectively constrained trade and 

dictated that only one contractor would service a territory. (ECF No. 42 at ¶ 35.) Clear 

Connection states that O.C. Communications intended to take over Clear Connection operations, 

using Clear Connections employees after Comcast forced Clear Connection to terminate them. 

(ECF No. 42 at ¶ 43.) Clear Connection supports this assertion with facts stating that O.C. 

Communications anticipated Clear Connection’s contract termination and placed an 

advertisement in a newspaper for new employees prior to Clear Connection receiving notice. 

(ECF No. 42 at ¶ 47.) The Court finds that these allegations provide sufficient information as to 

the time, place, and persons involved in the alleged conspiracy, as well as the agreements 

underlying the conspiracy. 

c. Allegations of Wrongful Acts by Comcast 

Finally, Comcast argues that Clear Connection has failed to prove Comcast committed a 

wrongful act, as required for its Cartwright Act claim. (ECF No. 54-1 at 17.) Comcast argues 

that “a business entity’s unilateral decision not to do business with a specific entity or to 

exclusively deal with one provider does not constitute a wrongful act for the purposes of antitrust 

laws.” (ECF No. 54-1 at 17.) The Court finds this argument to be an oversimplification of the 

FAC and reflective of Comcast’s habit in these pleadings of arguing the facts it prefers rather than 

the facts that were asserted. It is incumbent upon this Court to accept Clear Connection’s 

allegations as true for the purposes of this motion. Cruz, 405 U.S. at 322. Clear Connection did 

not simply allege that Comcast decided to stop working with it. Instead, Clear Connection asserts 

that Comcast and O.C. Communications engaged in a plan to use “its overbearing market 

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presence to force Clear Connection to give up its business and its employees and put itself in a 

financially perilous situation” and then assisted O.C. Communcations to “usurp[ ] Clear 

Connection operations, employees, and market share.” (ECF No. 42 at ¶¶ 48–49.) At this stage 

of the litigation, these facts and assertions are entirely sufficient to establish that Comcast 

committed a “wrongful act” for the purposes of a Rule 12(c) motion. For these reasons, 

Comcast’s motion for judgment on the pleadings as to Count I is denied. 

ii. Count II: Civil Conspiracy 

Comcast argues that Clear Connection may not bring a claim of civil conspiracy because 

“it is well established that civil conspiracy is not an independent claim.” (ECF No. 54-1 at 18.) 

While it is correct that a claim of civil conspiracy must attach to some other actionable wrong that 

fact should not be taken to mean that it is not an independent cause of action. Okun v. Superior 

Court, 29 Cal. 3d 442, 454 (1981) (“A complaint for civil conspiracy states a cause of action only 

when it alleges the commission of a civil wrong that causes damage.”). “A cause of action for a 

conspiracy in restraint of trade must allege (1) the formation and operation of the conspiracy, (2) 

the wrongful act or acts done pursuant thereto, and (3) the damage resulting from such act or 

acts.” Quelimane Co. v. Stewart Title Guar. Co., 19 Cal. 4th 26, 47 (1998), as modified (Sept. 

23, 1998)) (internal citations omitted). Clear Connection presents a clear underlying tort within 

these requirements – conspiracy committed to restrain trade. Clear Connection alleges that 

Comcast and O.C. Communications “conspired to unlawfully eliminate competition and to 

fraudulently and maliciously injure [Clear Connection’s] business.” (ECF No. 42 at ¶ 58.) As 

discussed in detail in Section III.a.i., supra, Clear Connection has pleaded sufficient facts to 

support its allegations of unfair trade. Therefore, with these allegations, Clear Connection meets 

the pleading requirement by alleging facts in support of each element of the claim of civil 

conspiracy. For these reasons, the Court denies Comcast’s motion for judgment on the pleadings 

as to Count II. 

iii. Count III: UCL Claim Fails to State a Claim 

Clear Connection’s third cause of action alleges unlawful business practices under the 

California Unfair Competition Law (“UCL”), Cal. Bus. & Prof. Code § 17200, et. seq. (ECF No. 

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42 at ¶¶ 61–67.) Clear Connection alleges that Comcast’s business practices are unlawful 

because they violate the Cartwright Act under California state law, as well as the Sherman and 

Clayton Acts under federal law.2 (ECF No. 42 at ¶ 64.) Comcast argues that this claim must be 

dismissed because the underlying Cartwright Act claim, Count I, must be dismissed. (ECF No. 

54-1 at 17.) Because the Court finds that Clear Connection’s Cartwright Act claim survives the 

motion for judgment on the pleadings, it must similarly deny Comcast’s motion with respect to 

the instant cause of action. Because the Cartwright Act claim stands, Clear Connection may bring 

an unlawful business practices claim relying on the Cartwright Act and Comcast’s motion as to 

this count is denied.

iv. Count IV: Fraud and Deceit 

Clear Connection brings a claim for fraud and deceit as its fourth cause of action. (ECF 

No. 42 at ¶¶ 68–77.) Comcast moves for judgment as to this claim, arguing that it fails in three 

ways: 1) the parol evidence rule bars evidence of alleged oral representations that contradict the 

written agreement; 2) Clear Connection has not alleged fraud with the requisite specificity; and 3) 

Clear Connection has not alleged the elements of a fraud claim. (ECF No. 54-1 at 18–21.) The 

Court finds that the parol evidence rule bars Clear Connection’s cause of action as it is currently 

written and therefore grants judgment in Comcast’s favor with leave to amend.3

Comcast argues that Clear Connection cannot bring this cause of action because the 

parties’ written agreement directly contradicts the alleged oral misrepresentations, and oral 

evidence contradicting a written agreement is barred by the parol evidence rule. (ECF No. 54-1 

at 18–19.) Clear Connection opposes this argument, stating that the cause of action is not barred 

by the parol evidence rule because the underlying written agreements are unenforceable. (ECF 

No. 55 at 6–7.) 

 

2

 Comcast argues that Clear Connection has not pleaded sufficient facts to allege that Comcast violated the Sherman 

and Clayton Acts. (ECF No. 54-1 at 17.) The Court agrees. Aside from its passing reference to the Sherman and 

Clayton Acts, Clear Connection makes no substantiated allegations that violations under those acts occurred. (ECF 

No. 42 at ¶ 64.) Therefore, Count III cannot stand under the Sherman or Clayton Acts. To the extent that Clear 

Connection relies on the violation of the Sherman and Clayton Acts in support of its third cause of action, the claim is 

dismissed with leave to amend so that Clear Connection may allege facts supporting a violation of the Sherman and 

Clayton Acts. 

3

 Because the Court finds grounds for judgment on the pleadings based on the requirements of the parol evidence 

rule, it does not reach Comcast’s arguments for judgment on other grounds. 

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The Court has already addressed this issue in a previous ruling. (Order on Mot. for J. on 

the Pleadings, ECF No. 39.) In its Order, this Court dismissed Clear Connection’s fraud in the 

inducement claim, finding that Clear Connection’s claim was barred by the parol evidence rule. 

(ECF No. 39 at 9.) The Court recognized that, although a fraud exception to the parol evidence 

rule would permit Clear Connection to attack the validity of the underlying agreement, Clear 

Connection had not made an effort to attack the contract’s enforceability. (ECF No. 39 at 9 

(citing Groth-Hill Land Company v. General Motors, LLC, No. C13-1362-THE, 2013 WL 

3853160, at *15 (N.D. Cal. Jul. 23, 2013)).) The Court explained that, while the fraud exception 

to the parol evidence rule may be used to show that the underlying written agreement was not 

valid, the exception does not permit general evidence that an extrinsic agreement separate from 

the written agreement existed. (ECF No. 39.) Clear Connection tries to avoid this issue in its 

current fraud claim by stating that the parol evidence rule does not apply when the written 

agreements are unenforceable. (ECF No. 55 at 6–7.) Unfortunately, Clear Connection fails to put 

forth any cause of action actually alleging that the underlying written agreements are invalid. 

Clear Connection simply states in conjunction with its sixth cause of action that it “believes that 

these written agreements lack consideration and are unenforceable because Comcast didn’t bind 

itself to any performance.” (ECF No. 42 at ¶ 86.) Unfortunately, that assertion on its own, 

without further detail and factual support, is not enough to free Clear Connection from the 

underlying written agreement, therefore requiring the Court to apply the parol evidence rule. 

Clear Connection cannot simply state that no underlying written agreement exists for the 

convenience of its fraud and deceit claim. It must provide factual and legal substantiation for its 

exemption from the requirements of the parol evidence rule. Therefore, Clear Connection’s 

fourth cause of action is dismissed with leave to amend. 

v. Count V: Breach of Oral Contract 

Comcast similarly argues that Clear Connection’s fifth cause of action, alleging breach of 

oral contract, fails because the alleged oral promise conflicts with the terms of the parties’ written 

agreements. (ECF No. 54-1 at 24.) Clear Connection does not address this argument. For the 

reasons stated in Section III.a.iv, supra, the Court dismisses Clear Connection’s fifth cause of 

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action with leave to amend. In order to maintain that an oral contract existed outside of the 

parties’ written agreement, Clear Connection must put forth sufficient factual and legal analysis 

arguing that the underlying written agreements are unenforceable. Without doing so, Clear 

Connections allegation of breach of oral contract cannot stand. 

vi. Count VI: Breach of Written Contract 

Clear Connection brings a claim for breach of written contract. (ECF No. 42 at ¶¶ 85–90.) 

Comcast seeks judgment on the pleadings as to this claim, arguing that Clear Connection has 

failed to identify the contract breached and the express terms or underlying purpose to which the 

breach is tied. (ECF No. 54-1 at 24.) The Court is inclined to agree. 

In order to survive Comcast’s motion, Clear Connection must plead sufficient facts as to 

each of the following elements: “(1) the existence of the contract, (2) plaintiff’s performance or 

excuse for nonperformance, (3) defendant’s breach, and (4) the resulting damages to the 

plaintiff.” Oasis West Realty, LLC v. Goldman, 51 Cal. 4th 811, 821 (2011). “If the action is 

based on alleged breach of a written contract,” as in the instant case, “the terms must be set out 

verbatim in the body of the complaint or a copy of the written agreement must be attached and 

incorporated by reference.” Harris v. Rudin, Richman & Appel, 74 Cal. App. 4th 299, 307 (1999). 

Here, Clear Connection has failed as a threshold matter to identify the specific agreement 

breached. In fact, the claim itself simply states, “Clear Connection performed all promises in the 

various written agreements” without any reference to which “various written agreements” the 

claim refers. (ECF No. 42 at ¶ 88.) This vagueness does not meet the most basic of pleading 

standards under Rule 8(a). 

Clear Connection’s defense on this point is puzzling. It maintains that the written 

agreements invoked by Comcast are unenforceable, but pleads this cause of action in the 

alternative. (ECF No. 55 at 22.) Clear Connection states that it “cannot predict in advance how 

the Court will rule [on the enforceability of the written agreements]” and therefore pleads the 

cause of action with “as much specificity as possible.” (ECF No. 55 at 22.) This argument 

confounds the Court because, as previously stated, Clear Connection has made no legal argument 

or motion asking this Court to review the enforceability of its written agreements. See Section 

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Section III.a.iv, supra. Moreover, while Clear Connection is certainly entitled to allege 

alternative arguments in relation to other arguments, that does not relieve it of the pleading 

requirements under Rule 8(a). Regardless of how tiresome it might feel to Clear Connection to 

allege specific and factually supported claims that may become moot during the course of this 

litigation, it is more tiresome to the Court to review, a second time, a breach of contract claim that 

does not meet the pleading requirements. Therefore, Clear Connection’s sixth cause of action is 

dismissed with leave to amend.

vii. Count VII: Common Counts 

Clear Connection’s seventh and final cause of action alleges “common counts” against 

Comcast, stating that Comcast has received benefits from its unjust conduct at the expense of 

Clear Connection and should be required to disgorge its unjust enrichment. (EF No. 42 at ¶¶ 91–

93.) Comcast moves for judgment on this claim, arguing that the common counts cause of action 

does not allege any specific legal theory as required under California law. (ECF No. 54-1 at 26.) 

Clear Connection argues that its common counts claim is an appropriate tool to seek a 

“restitutionary disgorgement as an alternative to a recovery for contractual expectancy.” (ECF 

No. 55 at 23.) 

“A common count is not a specific cause of action, however; rather, it is a simplified form 

of pleading normally used to aver the existence of various forms of monetary indebtedness, 

including that arising from an alleged duty to make restitution under an assumpsit theory.” 

McBride v. Boughton, 123 Cal. App. 4th 379, 394 (2004). A common count is a unique 

construction under California law that is not generally subject to dismissal on the grounds of 

uncertain or insufficient pleading. Moya v. Northrup, 10 Cal. App. 3d 276, 279 (Ct. App. 1970). 

However, “[w]hen a common count is used as an alternative way of seeking the same recovery 

demanded in a specific cause of action, and is based on the same facts, the common count is 

demurrable if the cause of action is demurrable.” Berryman v. Merit Prop. Mgmt., Inc., 152 Cal. 

App. 4th 1544, 1559–60 (2007) (citing McBride v. Boughton, 123 Cal.App.4th 379, 394–95 

(2004)). 

Clear Connection argues that its common count should not be dismissed because it is 

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seeking restitution damages, not expectation damages under a contract cause of action. (ECF No. 

55 at 23.) However, Clear Connection fails to provide any legal support for its contention, and 

such a conclusion conflicts with the logical application of the common count cause of action. A 

common count does not need to be specific as to the “various forms of monetary indebtedness” 

sought. McBride v. Boughton, 123 Cal. App. 4th at 394. It does, however, need to be rooted in 

another specific cause of action and must rely on those same facts. Id. Therefore, Clear 

Connection’s argument that it seeks a different form of damages is inapplicable. Under the 

theory of common counts, Clear Connection need only indicate to which cause of action its 

common counts claim is attached. 

Because the Court, through the instant order, has dismissed all FAC counts that would 

potentially provide the factual basis for these claims, Clear Connection’s common count claim 

must also be dismissed. However, the Court notes that Clear Connection’s common count claim, 

is sufficient to survive a second demurrer so long as Clear Connection makes clear on which 

count or counts the seventh cause of action relies and those related claims are sustainable.4 For 

these reasons, Clear Connection’s common count claim is dismissed with leave to amend.

B. Clear Connection’s Motion for Judgment on the Pleadings 

In its Answer to Clear Connection’s FAC, Comcast filed three counterclaims: 1) alleging 

breach of indemnity provisions of two written agreements between the parties; 2) seeking an 

order from the Court requiring Clear Connection to indemnify Comcast; and 3) seeking 

declaratory relief from this Court. (ECF No. 50.) In support of its counterclaims, Comcast 

alleges that the parties entered into a PVA on or about January 1, 2009, which contained an 

indemnification clause. (ECF No. 50 at 16–17.) Comcast further alleges that the parties entered 

into a second PVA on or about May 1, 2010, which also contained an indemnification clause. 

(ECF No. 50 at 17–18.) Comcast then argues that these indemnification provisions require Clear 

Connection to indemnify Comcast for any liability associated with Delgado, et al. v. Clear 

 

4

 Comcast argues in its reply that Clear Connection may not bring a claim for damages arising out of the underlying 

written agreements because the binding agreements already define the parties’ recovery rights. (ECF No. 61 at 10.) 

The Court does not address this argument under the assumption that Clear Connection intends to dispute the 

enforceability of these written agreements through proper pleading. Therefore, the Court anticipates that Comcast’s 

argument will become moot if Clear Connection opts to file a third amended complaint. 

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Connection Corp., et al., No. 34-2010-00079614, an employee wage payment claim filed in 

Sacramento Superior Court and subsequently dismissed on April 17, 2014. (ECF No. 50 at 22.) 

Comcast “disagrees with Clear Connection’s interpretation of the indemnification provisions in 

the 2009 and 2010 PVAs” and therefore asks this Court to enforce those provisions against Clear 

Connection with respect to the Delgado litigation. (ECF No. 50 at 22.) Clear Connection filed a 

cross-motion for judgment on the pleadings as to these counterclaims. (ECF No. 56.) 

Clear Connection makes a number of arguments in support of its motion for judgment on 

the pleadings. Clear Connection does not differentiate as to which claims its arguments apply, 

but because of the similarities in Comcast’s counterclaims, the Court will apply each argument to 

all counterclaims. 

i. Contract Enforceability 

Each of Comcast’s counterclaims seek to enforce the indemnity clauses within the 2009 

and 2010 PVAs. In response, Clear Connection argues that there is no consideration for the 

indemnity clauses and they are therefore unenforceable. (ECF No. 56 at 9.) This argument is 

inappropriate under a Rule 12(c) motion. In considering a motion for judgment on the pleadings, 

the Court must apply the standards normally applicable to a motion to dismiss pursuant to Rule 

12(b)(6). See Enron Oil Trading & Transp. Co. v. Walbrook Ins. Co., Ltd., 132 F.3d 526, 528-29 

(9th Cir. 1997). That is, a court may not dismiss a complaint in which the plaintiff has alleged 

“enough facts to state a claim to relief that is plausible on its face.” Iqbal, 556 U.S. at 678 

(quoting Twombly, 550 U.S. at 570). In its brief, Clear Connection does not make any arguments 

regarding the sufficiency of Comcast’s pleadings, but instead argues that there is no consideration 

for the parties’ written agreements by asking this Court to look at documents outside the PVAs, 

specifically asking the Court to review the parties’ SOW, and other statements by Comcast made 

outside of its counterclaims. (ECF No. 56 at 9–10.) At this stage, the Court is permitted only to 

assess the “facial plausibility” of the “factual content that allows the court to draw the reasonable 

inference” in favor of the party asserting the claims. Iqbal, 556 U.S. at 678 (2009) It should be 

clear to Clear Connection that its argument requires analysis that is outside the scope of what 

Rule 12(c) requires. 

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Clear Connection further argues that Comcast should be prohibited from arguing the 

defenses of reasonableness, notice, or good faith to save its argument in the face of Clear 

Connection’s proposed grounds for dismissal. (ECF No. 56 at 11.) The very fact that Clear 

Connection attempts to anticipate and address Comcast’s defenses further illustrates that Clear 

Connection’s entire argument is misplaced at this stage of the litigation.5 Because a 12(c) motion 

requires the Court to look only at the facial plausibility of the claim, the Court cannot grant Clear 

Connection’s motion on these arguments. 

ii. Judicial Estoppel 

Second, Clear Connection argues that Comcast should be judicially estopped from 

asserting that there is consideration and mutuality of obligation for the PVAs because Comcast 

has previously denied that it had any duty of performance. (ECF No. 56 at 13.) Comcast 

responds by arguing that Clear Connection should be judicially estopped from arguing that the 

written contracts are unenforceable because it has alleged inconsistent positions throughout its 

pleadings. (Def.’s Opp. to Plf’s Mot. for J. on the Pleadings, ECF No. 59 at 12–14.) This Court 

will not accept either party’s argument on judicial estoppel. In attempting to apply judicial 

estoppel in this manner, the parties seek to bend the doctrine to an absurd conclusion. 

The purpose of judicial estoppel is to “protect the integrity of the judicial process by 

‘prohibiting parties from deliberately changing positions according to the exigencies of the 

moment.’” Baughman v. Walt Disney World Co., 685 F.3d 1131, 1133 (9th Cir. 2012) (quoting 

New Hampshire v. Maine, 532 U.S. 742, 749–50 (2001)). The application of judicial estoppel is 

within the discretion of the district court. Id. In considering whether to apply the doctrine of 

judicial estoppel, the Court will assess the following factors: “(1) Is the party’s later position 

clearly inconsistent with its earlier position? (2) Did the party succeed in persuading a court to 

accept its earlier position, creating a perception that the first or second court was misled? (3) Will 

the party seeking to assert an inconsistent position derive an unfair advantage or impose an unfair 

 

5

 Clear Connection also argues that, if the Court finds consideration for the PVAs and SOW, then Clear Connection 

is entitled to sue under contractual expectancy. (ECF No. 56 at 12–13.) However, the Court finds this argument 

unclear and entirely unrelated to motion for judgment on Comcast’s counterclaims. Therefore, the Court does not 

address this argument. 

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detriment on the opposing party?” Id. (internal quotations omitted). 

Clear Connection alleges that Comcast argued in its first motion for judgment on the 

pleadings (ECF No. 30) that it had no duty of performance to Clear Connection under various 

written agreements. (ECF No. 56 at 14.) Clear Connection points to this position as being clearly 

inconsistent with Comcast’s current position and argues that the Court accepted Comcast’s 

position in its Order granting judgment in favor of Comcast on Comcast’s first motion for 

judgment on the pleadings. (ECF No. 56 at 14.) But Comcast’s positions in its motion for 

judgment and the instant counterclaim are not “clearly inconsistent” as required by the Ninth 

Circuit. Baughman, 685 F.3d at 1133. In its motion for judgment on the pleadings, Comcast 

makes no arguments as to the mutuality or consideration related to the 2010 PVA, but instead 

argued that proper enforcement of the 2010 PVA would preclude Clear Connection’s claim for 

breach of contract. (Mem. in Supp. of Mot. for J. on the Pleadings, ECF No. 31 at 12–14.) While 

it is true that Comcast maintains that the 2010 PVA did not require Comcast to provide work to 

Clear Connection, this argument is not tantamount to a statement that mutuality or consideration 

does not exist.6 Indeed, such an argument would be antithetical to Comcast’s argument seeking 

enforcement of the 2010 PVA. Likewise, in its counterclaim, Comcast makes no representation 

as to the mutuality or consideration of the PVAs, although its overall request to enforce the PVAs 

would suggest that Comcast believes mutuality and consideration do exist. (ECF No. 50 at 21–

22.) Therefore, the Court finds that Comcast did not assert clearly inconsistent positions. 

Moreover, Comcast did not “succeed in persuading a court to accept its earlier position” 

as required by the Ninth Circuit. Baughman, 685 F.3d at 1133. In its Order dismissing Clear 

Connection’s breach of contract cause of action, the Court wrote, “Clear Connection’s breach of 

contract claim fails because the plain language of the contract expressly contradicts Clear 

Connection’s claim that the July 28, 2010 letter improperly modified the contract.” (ECF No. 39 

at 7.) In its decision, the Court found only that, as related to the July 28, 2010 letter, no breach of 

contract existed because the letter was consistent with the terms of the PVA. The Court did not 

 

6

 The Court is puzzled as to why Clear Connection expects the Court to assume that a requirement to provide work to 

Clear Connection would be the only source of consideration and mutuality within these written agreements. 

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offer any opinion on the mutuality or consideration in the contract. Therefore, the Court did not 

accept the position Clear Connection proposes. For these reasons, the Court must deny Clear 

Connection’s motion to enter judgment against Comcast’s counterclaims on the grounds of 

judicial estoppel. 7

In response to Clear Connection’s motion for judgment, Comcast similarly argues that 

Clear Connection should be estopped from arguing that the parties’ written contracts are 

unenforceable because Clear Connection asserted in its first complaint that the contracts were 

enforceable. (ECF No. 59 at 12–13.) Although resolution of this argument is not required to 

decide the instant motion, the Court addresses it now so that Comcast is not tempted to resurrect 

the issue and further waste judicial resources at a later date. Rule 8(d)(3) permits a party to plead 

alternative legal arguments, even if they are inconsistent. Teledyne Indus., Inc. v. N.L.R.B., 911 

F.2d 1214, 1218 (6th Cir. 1990) (“The doctrine of judicial estoppel does not clash with the right 

to plead inconsistent claims under Fed.R.Civ.P. 8[(d)(3)]. Rule 8[(d)(3)] concerns the ability to 

plead alternative legal arguments, even if they are inconsistent or based on inconsistent facts.”) 

The fact that Clear Connection seeks both to enforce the parties’ written agreements and to have 

those written agreements declared unenforceable cannot be a basis for judicial estoppel because 

such an application of the doctrine would defeat the entire purpose of alternative pleadings. 

Furthermore, Clear Connection is required to support its causes of action with sufficient factual 

allegations, requiring that it asserts facts to support both arguments. This use of conflicting 

argument stands only to threaten the integrity of the parties, not the Court itself, and is therefore 

permissible. Id. The Court will not look favorably on further argument from Comcast that Clear 

Connection should be estopped from properly pleading arguments in the alternative. 

iii. Permissive Counterclaim 

Clear Connection argues that the Court does not have subject matter jurisdiction to hear 

Comcast’s counterclaims because Comcast has failed to show that its claims meet the required 

$75,000 amount in controversy under 28 U.S.C. § 1332(a). (ECF No. 56 at 19–20.) Clear 

 

7

 Because the Court finds that Clear Connection’s argument does not meet the first two factors for the application of 

judicial estoppel, the Court finds that it would be superfluous to discuss potential prejudice against Clear Connection. 

Therefore, the Court will not address the third prong of the analysis. 

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Connection further argues that the Court cannot exercise supplemental jurisdiction over 

Comcast’s counterclaims because they do not arise out of the same transaction or occurrence as 

required under Federal Rule of Civil Procedure 13(a) (“Rule 13(a)”). (ECF No. 56 at 20.) 

Comcast argues that its counterclaims are considered compulsory counterclaims under Rule 13(a) 

and, in the alternative, that its counterclaims are permissive counterclaims with their own 

jurisdictional basis under Rule 13(b). (ECF No. 59 at 17–22.) The Court agrees that Comcast’s 

counterclaims have an independent diversity jurisdiction and therefore may remain as permissive 

counterclaims. 

Comcast responds to Clear Connection’s motion for judgment by first arguing that its 

counterclaims do not need to meet the requirements of 28 U.S.C. § 1332(a) because its 

counterclaims are compulsory counterclaims and are therefore subject to supplemental 

jurisdiction. (ECF No. 59 at 17–22.) Rule 13 defines two types of counterclaims: compulsory 

and permissive. “Compulsory” counterclaims are claims that “arise[ ] out of the transaction or 

occurrence that is the subject matter of the opposing party’s claim.” FED.R.CIV.P. 13(a). The 

Ninth Circuit applies the “logical relationship” test to determine if a counterclaim is compulsory 

by analyzing “whether the essential facts of the various claims are so logically connected that 

considerations of judicial economy and fairness dictate that all the issues be resolved in one 

lawsuit.” Pochiro v. Prudential Ins. Co. of Am., 827 F.2d 1246, 1249 (9th Cir. 1987) (internal 

citations omitted). Here, the Court finds that Comcast’s counterclaims do not meet the 

requirements of the logical relationship test. Comcast is attempting to enforce the indemnity 

clause of two of the parties’ written agreements as they applied to a state law wage claim filed in 

Sacramento Superior Court. Although the PVAs at issue in these counterclaims are also at issue, 

on different grounds, in Clear Connection’s complaint, it does not follow that there is a logical 

connection. Comcast asks this Court not only to assess an entirely different section of the PVAs 

in its counterclaim, but asks it to apply those indemnity clauses to the facts of a state law claim 

clearly outside its jurisdiction. Comcast would like this Court to view the legal question at issue 

here as whether the two PVAs are generally enforceable, thus arguing that the case and 

controversy is the same. However, in reality, Comcast asks the Court to look at entirely different 

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facts and conduct an entirely distinct legal analysis. For that reason, the Court finds that Comcast 

has not offered compulsory counterclaims. 

However, Comcast is permitted to bring a permissive counterclaim that does “not aris[e] 

out of the transaction or occurrence that is the subject matter of the opposing party’s claim.” 

Fed.R.Civ.P. 13(b). “Because Comcast’s counterclaims are not compulsory, the next question is 

whether supplemental jurisdiction over the counterclaims nevertheless exists under 28 U.S.C. § 

1367(a).”8 Sparrow v. Mazda Am. Credit, 385 F. Supp. 2d 1063, 1066 (E.D. Cal. 2005). Under 

28 U.S.C. § 1367(a), the Ninth Circuit has found that “only a ‘loose factual connection between 

the claims’ is necessary” to establish supplemental jurisdiction. CE Distribution, LLC v. New 

Sensor Corp., 380 F.3d 1107, 1114 (9th Cir. 2004) (quoting Channell v. Citicorp Nat’l Svcs., Inc., 

89 F.3d 379, 385 (7th Cir.1996)). Therefore, because Comcast has established a loose factual 

connection between the indemnity clauses of the PVAs and the other legal issues related to the 

PVAs alleged by Clear Connection, the Court finds that it may exercise supplemental jurisdiction 

over Comcast’s counterclaims and therefore denies Clear Connection’s motion for judgment as to 

these claims on jurisdictional grounds.9

IV. CONCLUSION

For the reasons set forth above, the Court hereby GRANTS IN PART and DENIES IN 

PART Comcast’s Motion for Judgment on the Pleadings (ECF No. 54) and DENIES Clear 

 

8

 The Ninth Circuit has not definitively ruled on the question whether § 1367 jurisdiction can cover permissive 

counterclaims. The Seventh Circuit has held that 28 U.S.C. § 1367 “case or controversy” analysis applies to both the 

compulsory and permissive counterclaims under Rule 13. Channell v. Citicorp Nat. Servs., Inc., 89 F.3d 379, 385 

(7th Cir.1996) (“Now that Congress has codified the supplemental jurisdiction in § 1367(a), courts should use the 

language of the statute to define the extent of their powers.”). Within the Ninth Circuit, trial courts are split. One 

district court in Arizona found if the counterclaim is permissive, supplemental jurisdiction cannot attach. Hart v. 

Clayton–Parker & Associates, Inc., 869 F.Supp. 774, 776 (D.Ariz.1994). In decisions this Court finds persuasive, 

other courts have rejected Hart and followed the Seventh Circuit See, e.g., Sparrow v. Mazda Am. Credit, 385 F. 

Supp. 2d 1063, 1070 (E.D. Cal. 2005); Koumarian v. Chase Bank USA, N.A., C–08–4033 MMC, 2008 WL 5120053 

(N.D.Cal. Dec.3, 2008); Avery v. First Resolution Mgmt. Corp., 06–1812 HA, 2007 WL 1560653 (D.Or. May 25, 

2007), aff’d, 561 F.3d 998 (9th Cir.2009); Mostin v. GL Recovery, LLC, SACV090650AGANX, 2010 WL 668808 

(C.D.Cal. Feb.19, 2010). 

9

 Even if the Court found that supplemental jurisdiction under 28 U.S.C. § 1367 did not apply to permissive 

counterclaims, as is argued by some district courts within the Ninth Circuit, Comcast’s counterclaims would still 

have an independent basis for diversity jurisdiction. The parties in this litigation have diversity of citizenship under 

28 U.S.C. § 1332 and Comcast has alleged an amount in controversy in excess of $75,000. Crum v. Circus Circus 

Enterprises, 231 F.3d 1129, 1131 (9th Cir. 2000) (“Generally, the amount in controversy is determined from the face 

of the pleadings.”). 

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Connection’s Motion for Judgment on the Pleadings as to Comcast’s counterclaims (ECF No. 

56). The Court orders as follows: 

1. Comcast’s Motion for Judgment as to Counts I, II, III is DENIED. 

2. Comcast’s Motion for Judgment as to Counts IV, V, VI, VII is GRANTED WITH 

LEAVE TO AMEND. 

3. Clear Connection’s Motion for Judgment as to Comcast’s Counterclaims is DENIED. 

If Clear Connection intends to file an amended complaint, it must submit its filing with 30 days of 

entry of this Order. Amendments to Clear Connection’s complaint must be limited to only those 

issues discussed within the instant Order. Comcast shall have 30 days from the filing of Clear 

Connection’s amended complaint to file an answer. 

IT IS SO ORDERED. 

Dated: December 7, 2015 

Case 2:12-cv-02910-TLN-DB Document 65 Filed 12/08/15 Page 23 of 23