Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-casd-3_05-cv-00916/USCOURTS-casd-3_05-cv-00916-0/pdf.json

Nature of Suit Code: 190
Nature of Suit: Other Contract Actions
Cause of Action: 28:1332 Diversity-Fraud

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1 The facts in this background section are taken from Plaintiffs’ complaint.

06cv1124

UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF CALIFORNIA

SAVAS DALKILIC and TUNCAY

CELIK, 

Plaintiffs,

v.

TITAN CORP. and SOS

INTERNATIONAL, LTD.,

Defendants. 

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Civil No. 05CV0916 JAH (AJB)

ORDER GRANTING IN PART AND

DENYING IN PART

DEFENDANTS’ JOINT MOTION

FOR JUDGMENT ON THE

PLEADINGS

[Doc. No. 75] 

Now before this Court is Defendants The Titan Corporation and SOS International

Ltd.’s (collectively “Defendants”) joint motion for judgment on the pleadings. Doc. No. 75.

Plaintiffs Savas Dalkilic and Tuncay Celik (collectively “Plaintiffs”) and Defendants fully

briefed the issues. Oral argument was heard on June 7, 2007, with appearances by Michael

Morrison for Plaintiffs, and Ari Zymelman and Timothy Horton for Defendants. This Court,

after hearing the oral argument of counsel, took the matters under submission. After a

thorough consideration of the pleadings, files and records in this case, as well as the oral

argument of counsel, and for the reasons stated below, this Court hereby GRANTS IN PART

and DENIES IN PART motion for judgment on the pleadings.

BACKGROUND

1. Factual Background1

Plaintiffs, both citizens of Turkey, are former employees of Defendants. Defendants

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contracted with the military to provide linguistic and interpretive services in Turkey, and later

during the Iraq War in 2003. Plaintiffs were recruited by Defendants in Turkey after

responding to advertisements seeking interpreters. After personal interviews and a written

examination, both Plaintiffs were extended offers to work with Defendant Titan Corporation

(“Titan”) in Mardin, Turkey. Plaintiffs worked in Turkey for a short period of time. After their

work in Turkey, both Plaintiffs were subsequently extended offers to work in Iraq.

Plaintiffs were concerned with potential legal problems of entering Iraq as Turkish

citizens, and voiced their concerns to Defendants. Plaintiffs were assured by Defendants that

the proper documents would be secured from the Turkish Foreign Office in order for Plaintiffs

to legally enter Iraq, and that the Turkish government would have full and official knowledge

of Plaintiffs’ role in Iraq. Plaintiffs were also allegedly promised compensation of at least $6000

a month, not inclusive of hazard pay, plus social security payments under Turkish law, per diem

allowances and medical benefits and training. Defendants allegedly represented to Plaintiff

Celik that “defendants would protect the interpreters in Iraq and that their job duties would

exclusively take place within the confines of the United States military bases.” Cplt. at ¶ 26.

Plaintiffs specifically allege that Defendants explicitly promised Plaintiffs that they would

receive the same treatment as other Titan employees employed in the same position.

Plaintiffs were first flown to Germany by Defendants prior to entering Iraq. Upon their

arrival, Plaintiffs alleged that they did not receive the proper survival training, unlike other

Titan employees. Plaintiffs also assert, that while in Iraq, they were allegedly “required to travel

outside of the military base and without any sort of security protection.” Cplt. at ¶ 30.

Plaintiffs further allege that they were denied the same access to medical care that their

American counterparts received, and were also not paid the salaries and benefits they were

allegedly promised. In addition, Plaintiffs state that their passports and visas were taken from

them while employed by Defendants, which took away any means of Plaintiffs challenging their

treatment. Plaintiffs further contend that in May 2003, Turkish military officers informed

them that they were illegally present in Iraq because of Defendants’ failure to secure the proper

authorization from the Turkish government.

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2 Defendant Titan previously filed a motion to dismiss for improper venue on August 22, 2005, and

October 13, 2005. See Doc Nos. 7 and 15. Both motions were subsequently withdrawn. Doc. Nos. 14 and

25.

3 06cv1124

Plaintiffs further allege that they were placed in danger after Defendants instructed

Plaintiff Dalkilic to provide translation services for the U.S. military during the interrogation

of Turkish special forces officers regarding an assassination attempt on the Mayor of Kirkuk.

Plaintiff Celik was also allegedly interrogated by Turkish intelligence officers who were

attempting to locate the captured Turkish special forces officers. Defendants allegedly

recognized the danger in which Plaintiffs were placed, and agreed to house Plaintiffs in safe

houses in the Baghdad area. During this period, Plaintiffs could not perform interpreter

services, and were forced instead to act as drivers for Defendant Titan and carry weapons to

protect themselves. As a result of Defendants’ actions, Plaintiffs allege that they were forced

to seek asylum in the United States, and could not return to Turkey to be with their families.

2. Procedural Background

On April 29, 2005, Plaintiffs filed their complaint seeking damages for fraud and deceit

(Claim 1), negligent misrepresentation (Claim 2), promissary estoppel (Claim 3), breach of oral

contract (Claim 4), breach of the covenant of good faith and fair dealing (Claim 5), intentional

infliction of emotional distress (Claim 6) and negligence (Claim 7) causes of action. 

Defendant Titan filed a motion to dismiss for improper venue on December 8, 2005.2

See Doc. No. 28. Defendant SOSI filed a limited joinder with Defendant Titan’s motion,

joining only as to the motion to dismiss for improper venue, and declining to join in the motion

to transfer. Doc. No. 34. Plaintiffs filed under seal an opposition to Defendant Titan’s motion

on February 3, 2006. Doc. No. 40. Defendant Titan filed a reply on March 1, 2006. See Doc.

No. 45. Defendant SOSI filed a reply in support of its joinder motion to Defendant Titan’s

motion to dismiss. Doc. No. 46.

On December 9, 2005, Defendant SOSI filed a motion to dismiss for lack of personal

jurisdiction. Doc. No. 31. Plaintiffs filed an opposition on February 3, 2006. Doc. No. 36.

On March 2, 2006, the parties stipulated to an extension of time for Defendant SOSI to file

a reply brief. Doc. No. 44. Defendants filed a reply brief on March 3, 2006. See Doc. No. 47.

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On March 9, 2006, Plaintiffs filed an ex parte application to file supplemental briefing. Doc.

No. 50. Defendant SOSI filed a response to Plaintiff’s ex parte application and accompanying

supplemental briefing. Doc. No. 51. On March 10, 2006, Defendant SOSI filed an ex parte

application with this Court for leave to file a first amended reply memorandum and a first

amended declaration from SOSI’s declarant, Julian Setian. Doc. No. 52. On March 14, 2006,

this Court granted Defendant SOSI’s leave to file a first amended reply and declaration. Doc.

No. 54. The Court also granted Plaintiffs’ ex parte request to file supplemental briefing to

Defendant SOSI’s motion to dismiss. Doc. No. 57. Plaintiffs filed supplemental briefing on

March 14, 2006. Doc. No. 58. On March 13, 2006, this Court took both motions to dismiss

under submission pursuant to CivLR 7.1(d.1). Doc. No. 53. On May 30, 2006, this Court

denied the motions to dismiss in its entirety. Doc. No. 59. Both parties filed answers to the

complaint on July 13, 2006.

On December 21, 2006, Magistrate Judge Anthony Battaglia issued an Order following

the parties’ settlement conference, and indicated that the parties could not settle the case

because they “need to proceed with a motion for judgment on the pleadings to help identify the

issues that will be ultimately litigated.” Doc. No. 72 at 1. Judge Battaglia indicated that such

a motion “may help bring the case back into a settlement posture.” Id. Judge Battaglia set

forth a briefing schedule for the motion for judgment on the pleadings, and set a hearing date

of June 7, 2007.

On February 28, 2007, Defendants filed a joint motion for judgment on the pleadings.

Doc. No. 75. Plaintiffs filed a response in opposition on April 30, 2007. Doc. No. 81.

Defendants filed a reply on May 21, 2007. Doc. No. 83. Oral argument was held on June 7,

2007. The Court subsequently took the matter under submission pursuant to Civ.LR 7.1(d.1).

DISCUSSION

I. Legal Standard - Motion for Judgment on the Pleadings

Under Federal Rule of Civil Procedure 12(c), a party may move for judgment on the

pleadings “[a]fter the pleadings are closed but within such time as not to delay the trial.”

Fed.R.Civ.P. 12(c). Judgment on the pleadings is proper only when there is no unresolved issue

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of fact and no question remains that the moving party is entitled to a judgment as a matter of

law. Torbet v. United Airlines, Inc., 298 F.3d 1087, 1089 (9th Cir. 2002); Honey v. Distelrath,

195 F.3d 531, 532-33 (9th Cir. 1999). The standard applied on a Rule 12(c) motion is

essentially the same as that applied on Rule 12(b)(6) motions. See Hal Roach Studios, Inc. v.

Richard Feiner & Co., 896 F.2d 1542, 1550 (9th Cir. 1989). Thus, the allegations of the nonmoving party are accepted as true, and all inferences reasonably drawn from those facts must

be construed in favor of the responding party. Id. If matters outside of the pleadings are

presented to and not excluded by the court, a motion for judgment on the pleadings shall be

treated as one for summary judgment pursuant to Rule 56, and all parties shall be given

reasonable opportunity to present all material made pertinent to such a motion by Rule 56. Id.

Judgment on the pleadings is not appropriate where the complaint alleges facts which,

if proved, would permit recovery. See General Conference Corp. of Seventh-Day Adventists v.

Seventh-Day Adventist Congregational Church, 887 F.2d 228, 230 (9th Cir. 1989).

Conclusory allegations and unwarranted inferences are insufficient to defeat a motion for

judgment on the pleadings. In re Syntex Corp. Sec. Litig., 95 F.3d 922, 926 (9th Cir. 1996).

II. Analysis

Defendants seek to dismiss Plaintiff’s complaint on the basis of Turkish, California and

Pennsylvania law. In particular, Defendants assert: 1) Turkey’s one year statute of limitations

bars any tort claim arising out of alleged conduct in Turkey; 2) the alleged remaining allegations

based on conduct in Iraq and Pennsylvania cannot survive because the allegations did not rise

to the level of outrageous conduct allowing emotional distress; 3) Plaintiffs’ breach of oral

contract claims fail because the alleged terms are too uncertain and the alleged oral contract is

barred by the statute of frauds; 4) the lack of direct physical injury precludes an award of

emotional damages under California and Pennsylvania law; and 5) punitive and future damages

awards are too speculative.

A. Torts Claims (Claim 1-2 and 6-7) Statute of Limitations

Defendants first contend that Plaintiffs’ first (fraud and deceit), second (negligent

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misrepresentation), sixth (intentional infliction of emotional distress) and seventh (negligence)

causes of action, to the extent that they are based on conduct in Turkey, fail because the causes

of action are outside the applicable Turkish statute of limitations. Doc. No. 75 at 7.

Defendants assert that under choice of law rules, California’s substantive laws apply to the

instant action. Id. Defendants state that California law views statute of limitations as

procedural, and therefore “governed by California law without regard to the substantive law

California law would choose.” Id., citing Zellmer v. Acme Brewing Co., 184 F.2d 940, 942 (9th

Cir. 1950). Defendants furthermore claim that California’s borrowing statute goes further to

“‘prevent[] residents of other states with claims that are barred in the jurisdiction in which they

arose from using the California courts to prosecute an action.” Id., citing to Cossman v.

DaimlerChrysler Corp., 108 Cal.App.4th 370, 376 (2003). Defendants assert that through

California’s borrowing statute, Turkey’s one-year statute of limitations bars Plaintiff’s claims

for fraud and deceit, negligent misrepresentation and negligence. Id. at 7-8, citing to Cerrhoglu

Decl. at ¶¶ 3-5.

Plaintiffs rebut, contending instead that California, not Turkish, law applies to their

claims. Doc. No. 81 at 1. Plaintiffs first argue that Defendants’ choice of law theory regarding

statute of limitations law is incorrect, and that Defendants’ citation to Zellmer “no longer

accurately reflects California law in this area.” Id. at 8. Instead, Plaintiffs assert that California

no longer applies the traditional analysis, but rather a “governmental interest analysis” to

determine choice of law questions. Id. at 8-9. Plaintiffs contend that applying a governmental

interest analysis, California, not Turkish, statute of limitations law would apply. Plaintiffs also

assert that the claims are more closely connected to Iraq, not Turkey, since “[t]he only thing

occurring in Turkey was Plaintiffs’ recruitment by Defendants.” Id. at 9. As a result, Plaintiffs

claim that California’s statute of limitations law would not bar Plaintiffs’ tort claims. Finally,

Plaintiffs argue that California’s borrowing statute is inapplicable to Plaintiffs because their

claims did not accrue, and therefore did not “arise under” the borrowing statute, until Plaintiffs

were physically in Iraq, not Turkey, and Defendants have not met their burden of proving that

Iraq’s statute of limitations would bar their claims. Id. at 12-13.

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In reply, Defendants reject Plaintiffs’ assertions equating “accruing,” or starting the clock

for statute of limitations purposes, and the element “arising under” as required by California’s

borrowing statutes. Doc. No. 83 at 2. Defendants also assert that even under California’s

governmental interest test, Turkey’s statute of limitations law would apply. Id.

1. California’s Borrowing Statute

Defendants contend that any choice of law analysis applied is irrelevant because

California’s borrowing statute requires that this Court apply the statute of limitations of

another state where: “(1) foreign citizens (such as Plaintiffs) attempt to use California courts

to assert (2) claims that are barred in the jurisdiction in which they arose.” Doc. No. 83 at 2,

citing to Cossman, 108 Cal.App.4th at 375, 376 (emphasis in original).

California Code of Civil Procedure § 361 states in relevant part that:

When a cause of action has arisen ... in a foreign country, and by the laws thereof an action thereon cannot be maintained against a person by reason of the lapse of time, an action thereon shall not be maintained against him in the State, except in favor of one who has been a citizen of this State, and who has held the cause of action from the time

it accrued.

Cal. Civ. Proc. Code § 361 (West 2006). California’s borrowing statute discourages forum

shopping by foreign plaintiffs by “borrowing” the statute of limitations from the state in which

the cause of action arose. Giest v. Sequoia Ventures, Inc., 83 Cal.App.4th 300, 303 (2000).

Plaintiffs here do not disagree that the events complained of occurred “in a foreign country,”

nor do they argue that the exception to § 361 applies to them. Accordingly, this Court is bound

to apply California’s borrowing statute to determine if the foreign country’s statute of

limitations would have barred the action. See Cossman, 108 Cal.App.4th at 378. 

Plaintiffs’ argument that California’s borrowing statute is inapplicable because the statute

“only applies if the action has ‘arisen’ in another state where the action cannot be maintained

because of lapse of time” is unpersuasive. See Doc. No. 81 at 12. Plaintiffs contend here that

the cause of action “arises” under the borrowing statute “when the statute of limitation

commences.” Id. Plaintiffs conclude that because the cause of action accrued in Iraq, and

because Defendants fail to discuss Iraq’s statute of limitations law, their motion must fail. Id.

at 13. To determine where the cause of action accrued, a court must look to “the time when,

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28 3 Because this Court finds that California’s Borrowing Statute applies, it will not address the parties’

governmental interest analysis discussion.

8 06cv1124

and the place where, the act is unlawfully committed or omitted.” Vestal v. Shiley, 1997 WL

910373, * 2 (C.D. Cal. Nov. 17, 1997). In California, a tort cause of action arises when the

wrongful act is committed, even though damages resulting from the tort was not sustained at

that time, and even though the plaintiff may not know that a tort has been committed. Rash

v. Bomatic, Inc., 2005 WL 503929, * 7 (Cal.App.4 Dist., Mar. 4, 2005), citing to Collins v.

County of Los Angeles, 241 Cal.App.2d 451, 457-58 (1966). Plaintiffs’ argument, therefore,

that a cause of action “arises under § 361" occurs when the statute of limitations time period

begins is an incorrect statement of the law. Accordingly, this Court must determine under §

361 “when (and where) a cause of action has arisen” for each applicable claim asserted by

Plaintiffs.3

a. Claims 1 and 2: Fraud and Deceit, and Negligent Misrepresentation

Defendants argue that a fraud claim arises at the time when the fraud is committed, “i.e.

at the time the defendant makes a knowingly false statement of fact with the intent to induce

reliance on that statement.” Doc. No. 83 at 4, fn. 7, citing to Kwan v. Schlein, 441 F.Supp.2d

491, 503-04 (S.D.N.Y. 2006). In response, Plaintiffs counter that the cause of action arose in

Iraq because “it was in Iraq that Plaintiffs discovered the promises made by Defendants were

in fact false.” Doc. No. 81 at 10.

Plaintiffs in claim 1 bring a cause of action for fraud and deceit of Defendants’ alleged

representations and promises made to Plaintiffs, including that: 

1) plaintiffs would not be taken to Iraq without the permission of the Turkish

government; 2) plaintiffs would be employed by defendants between 5 and 10 years; 3) plaintiff Dalkilic would receive between $5000-6000 per month for his services in Iraq and additional money for hazard pay; 4) plaintiff Celik would receive the same pay as

an “Admin” as other Admins in Iraq; 5) plaintiff Celik as an Admin would receive $7000

per month plus hazard pay; 6) plaintiffs would receive a per diem for any work outside of Kirkuk; 7) plaintiffs would receive social security payments (as required by Turkish law); 8) plaintiffs’ job duties in Iraq would take place exclusively within the confines of the military base; 9) plaintiffs would receive the same medical care, including vaccinations, as American interpreters in Iraq; 10) plaintiffs would not be required to carry firearms and serve as drivers in Iraq; and 11) plaintiffs would not be required to participate in military actions with USAF troops. 

Cplt. at ¶ 50. Claim 2 mirrors the actions recited in claim one absent any intent by

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Defendants. Id. at ¶ 62. In California, the elements of fraud are: 1) misrepresentation, 2)

knowledge of falsity; 3) intent to defraud, i.e. to induce reliance; 4) justifiable reliance; and 5)

damages. Lazar v. Superior Court, 12 Cal.4th 631, 638 (1996). “The elements of negligent

misrepresentation are similar to intentional fraud except for the requirement of scienter.”

Charnay v. Cobert, 145 Cal.App.4th 170, 184 (2006).

Upon review of Plaintiffs’ complaint, the Court finds that the actions Plaintiffs

complained of in claims 1 and 2 arose from Defendants’ alleged fraudulent conduct in Turkey.

For example, the complaint states that “[u]nbeknowst to plaintiffs, defendants failed to secure

the approval of the Turkish government prior to flying them to Germany and Iraq,” i.e. when

Plaintiffs were still in Turkey. Id. at ¶ 29. Plaintiffs’ own complaint, therefore, admits that the

alleged fraudulent action of Defendants failing to secure permission from the Turkish

government arose in Turkey. Similarly, the complaint explicitly states that the conditions of

employment that Plaintiffs claim were made fraudulently or were negligently misrepresented

all occurred in Turkey. See Id. at ¶¶ 25-28. Thus, even if Defendants had breached the alleged

contract in Iraq by allegedly forcing Plaintiffs to carry firearms or travel outside the military

base, the cause of action arose where the fraudulent inducement occurred and was completed,

i.e. in Turkey when the offer of employment was allegedly fraudulently made.

Accordingly, because the causes of action for fraud and deceit and negligent

misrepresentation arose in Turkey, Plaintiffs are citizens of Turkey, and one of the defendants

is a citizen of California, California’s borrowing statute under Cal. Civ. Proc. Code § 361

requires that this Court apply Turkey’s statute of limitations to Plaintiffs’ fraud claims, and not

California. 

b. Turkish Statute of Limitations

Defendants contend that Turkey’s “one-year statute of limitations” bars Plaintiffs’

claims. Doc. No. 75 at 8. Defendants cite to a declaration by Mr. Cerrahoglu, a Turkish

attorney practicing since 1973, for support, who states that:

Under Turkish law, the statute of limitations applicable to tort claims is set forth in Article 60 of the Turkish Code of Obligations. That article provides that such claims are

barred after one year from the date when the damages person has received knowledge of the damage and of the identity of the person who is liable. However, if the claim results

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from an act which is illegal under criminal law, and is, in accordance with criminal law

is [sic] subject to a longer period of limitation by statute in accordance with criminal law

then such period of limitation by statute shall also apply to the civil claim. 

Cerrahoglu Decl. at ¶ 3. The Court notes that Plaintiffs do not appear to dispute Defendants’

contentions regarding Turkey’s one-year statute of limitations. See Transcript at 9:3-22; 29:11-

15. Nor do Plaintiffs allege any criminal law related statute of limitations period applies. 

Plaintiffs plead in the complaint that they sought asylum as they were allegedly

instructed to do by Defendant Titan on July 31, 2003, after arriving at Ramstein Air Force in

Germany. Therefore, at the latest, the application of Turkey’s statute of limitations would run

on July 31, 2004. The instant complaint was filed on April 29, 2005, long after the one-year

deadline expired. Accordingly, this Court GRANTS dismissal of Plaintiffs’ causes of action for

fraud and deceit, and negligent misrepresentation, claims 1 and 2 of the complaint.

c. Claims 6 and 7: Intentional Infliction of Emotional Distress

(“IIED”) and Negligence

Plaintiffs assert that “a cause of action for intentional infliction of emotional distress is

not completed until the Plaintiff suffers severe emotional distress.” Doc. No. 81 at 10, citing

to Mollko v. Holy Spirit Association for the Unification of World Christianity, 46 Cal.3d 1092,

1120 (1988) (rev’d on other grounds). Defendants contend that they “have been unable to find

a case that supports Plaintiffs’ proposition, i.e., that the tort of IIED does not ‘arise’ until the

plaintiff actually suffers the distress.” Doc. No. 83 at 4. Defendants also add that it would be

“perverse to suggest that the same alleged tortuous conduct (i.e., misrepresentations in Turkey)

should be judged by two different jurisdictions’ statutes of limitation for the purposes of the

borrowing statute depending on whether the claim is for fraud or for IIED.” Id.

The elements for intentional infliction of emotional distress (“IIED”) in California

include: “‘1) extreme and outrageous conduct by the defendant with the intention of causing,

or reckless disregard of the probability of causing, emotional distress; 2) the plaintiff’s suffering

severe or extreme emotional distress; and 3) actual and proximate causation of the emotional

distress by the defendant’s outrageous conduct.” Conroy v. Regents of University of California,

__ Cal.Rptr.3d __ (Cal.App. 4 Dist. May 23, 2007), quoting Davidson v. City of Westminster,

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4

 The Court is mindful of the principle of dépeçage, which “erects a framework under which issues in a

single case, arising out of a common nucleus of operative facts, may be decided according to the substantive

law of different states.” Putnam Res. v. Pateman, 958 F.2d 448, 465 (1st Cir. 1992); citing Hunter v. Greene,

734 F.2d 896, 901 (2d Cir. 1984); Broome v. Antler’s Hunting Club, 595 F.2d 921, 923 n.5 (3d Cir. 1979). 

Courts apply this principle in diversity cases where the laws of one state do not govern other issues in the case. 

Courts, instead, apply a separate choice of law inquiry for each issue in the case

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32 Cal.3d 197, 209 (1982). The tort of negligence requires a party demonstrate a duty by the

defendant, breach of that duty, causation and resulting damages. Burgess v. Superior Court,

2 Cal.4th 1064, 1072 (1992).

Plaintiffs assert in the complaint that the alleged actions perpetrated on Plaintiffs, i.e. the

interrogation of Turkish soldiers, failing to secure proper permission from the Turkish

government for Plaintiffs in order for them to properly return to their native country, failing

to take “corrective and ameliorative action” after the Turkish soldiers were interrogated, and

failing to assist in asylum proceedings directly resulted in the suffering of severe emotional

distress by Plaintiffs. See Cplt. at ¶ 87. Thus, taking the factual allegations in the complaint

as true and in a light most favorable to Plaintiff, as this Court must do, Plaintiffs’ emotional

distress claim arose not in Turkey, but after Plaintiffs were either in Iraq, or in the United

States applying for asylum. 

Defendants’ generalized argument that it would be a “perverse” outcome should this

Court apply two different statute of limitations for causes of action originating from the same

contract is not persuasive. See Doc. No. 83 at 4. In S.A. Empresa de Viacao Aerea Rio

Grandense v. Boeing Co., 641 F.2d 746 (9th Cir. 1981), the court recognized in California that

where choice of law issues arise, “a separate choice-of-law inquiry must be made with respect

to each issue in a case.” Id. at 749, citing to Beech Aircraft Corp. v. Superior Court of Los

Angeles, 61 Cal.App.3d 501, 518 (1976).4 Accordingly, the Court finds it is the issue and tort

claim at hand, and not the underlying contract, that determines the choice of law issues here.

For the reasons stated above, this Court finds that the cause of action arose after the

alleged oral contract was entered into, and therefore outside of Turkey. The parties do not

disagree that if Defendants’ tortuous actions arose in Iraq, California’s statute of limitations law

would apply as a result of Coalition Provisional Authority 17. See Transcript at 28:5-13. For

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the purposes of this motion, this Court agrees. Thus, in regards to the actions complained of

in Iraq, the Court applies the applicable California statute of limitation. In regards to actions

complained of in Pennsylvania, the Court finds that the statute of limitations from this foreign

state applies. Because California and Pennsylvania’s statute of limitation laws do not bar

Plaintiffs’ claim for intentional infliction of emotional distress and negligence, the Court hereby

DENIES Defendants’ motion for judgment on the pleadings of Plaintiffs sixth and seventh

causes of action on statute of limitations grounds.

B. IIED and Negligence

1. IIED - Iraq Actions and Application of California Law (Claim 6)

Defendants assert that Plaintiffs’ complaint does not meet the requirements for

sustaining a cause of action for IIED under California law. Doc. No. 75 at 13. Defendants

contend that Plaintiffs “fail to show the existence of extreme and outrageous conduct necessary

to support a claim for IIED.” Id. Defendants instead claim that Plaintiffs’ complaint must

“allege conduct that is ‘beyond the bounds of human decency.’” Id. Defendants conclude that

“[a] defendant may not be ‘subject to liability for infliction of emotional distress when it has

merely pursued its own economic interests and asserted its legal rights.’” Id. at 15, citing to

Trerice v. Blue Cross of Cal., 209 Cal.App.3d 878, 885 (1989). 

The elements for intentional infliction of emotional distress in California include: “‘1)

extreme and outrageous conduct by the defendant with the intention of causing, or reckless

disregard of the probability of causing, emotional distress; 2) the plaintiff’s suffering severe or

extreme emotional distress; and 3) actual and proximate causation of the emotional distress by

the defendant’s outrageous conduct.” Conroy v. Regents of University of California, __

Cal.Rptr.3d __ (Cal.App. 4 Dist. May 23, 2007), quoting Davidson v. City of Westminster, 32

Cal.3d 197, 209 (1982). Although the question of whether a defendant’s conduct is

“outrageous” normally presents an issue of fact for a trier of fact, a reviewing court may, as a

matter of law, determine if “defendant’s conduct may reasonably be regarded as so extreme and

outrageous as to permit recovery.” Trerice, 209 Cal.App.3d at 883.

In the complaint, Plaintiffs allege that Defendants’ conduct, including the omission of

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obtaining proper permission for Plaintiffs to work in Iraq, the forced interrogation of Turkish

soldiers even when non-Turkish citizens who spoke Turkish were available, as well as the alleged

ramifications as a result of the threats received, including the movement of Plaintiffs to safe

houses, expulsion of Plaintiffs from safe houses during the day and being forced to spend the

days on the street without security protection, requiring Plaintiffs to drive vehicles for Titan

officials around Baghdad, and being asked to carry firearms, resulted in “extreme anguish.”

Cplt. at ¶¶ 36-43. Defendants contend that these actions as a matter of law do not rise to the

level needed to sustain a cause of action because the work assignments were merely

“objectionable.” Doc. No. 75 at 15. This Court disagrees with Defendants. A reasonable

person viewing the complaint’s factual allegations may conclude that Defendants’ conduct of

forcing Plaintiffs to perform work involving the interrogation of Turkish soldiers which resulted

in threats against their well-being, removing Plaintiffs to safe houses during the night, but

forcing Plaintiffs to spend the days on the streets of Baghdad without security protection, as

well as the other alleged actions, rise to the level of extreme and outrageous conduct and

indecent human behavior. The Court, therefore, finds that it cannot determine as a matter of

law that Defendants’ conduct fails to rise to a threshold level, and that a trier of fact, not this

Court, must determine whether Defendants’ conduct would rise to a level that is actionable

under California’s IIED laws. Accordingly, this Court DENIES Defendants’ motion to dismiss

Plaintiffs’ IIED claims for actions occurring in Iraq.

2. IIED - Pennsylvania (Claim 6)

Defendants argue that Plaintiffs cannot sustain a cause of action for IIED in

Pennsylvania because of Pennsylvania’s heightened standards. Doc. No. 75 at 15. Defendants

also assert that no physical harm has come to Plaintiffs, and therefore they assert no cause of

action for IIED. Plaintiffs refute these contentions. Plaintiffs point out that “allowing Plaintiffs

to sit in prison in Pennsylvania pending their asylum proceedings is extreme and outrageous

conduct under any definition of the term.” Doc. No. 81 at 18. Plaintiffs assert that

Defendants refused to acknowledge Plaintiffs’ status as employees of Defendants. Id.

In Hoy v. Angelone, 554 Pa. 134 (1998), the Pennsylvania Supreme Court made clear

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5 Papieves v. Lawrence, 437 Pa. 373 (1970) (defendant, after striking and killing plaintiff’s son with an

automobile, and after failing to notify authorities or seek medical assistance, buried body in a field where the

body was discovered two months later and returned to parents); Banyas v. Lower Bucks Hospital, 293

Pa.Super. 122 (1981) (defendants intentionally fabricated records to suggest that plaintiff had killed a third

party which led to plaintiff being indicted for homicide); and Chuy v. Philadelphia Eagles Football Club, 595

F.2d 1265 (3d Cir. 1979)( defendant’s team physician released to press information that plaintiff was suffering

from fatal disease, when physician knew such information was false). Hoy at 150-51. 

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upon reviewing several cases where the IIED causes of action were found,5 the standard for

establishing a cause of action for IIED:

[T]he conduct must be so outrageous in character, and so extreme in degree, as to go beyond all possible bounds of decency, and to be regarded as atrocious, and utterly intolerable in any civilized society ... [I]t has not been enough that the defendant has acted with intent which is tortuous or even criminal, or that he has intended to inflict

emotional distress, or even that his conduct has been characterized by “malice,” or a degree of aggravation that would entitle the plaintiff to punitive damages for another

tort.

Id. at 150. From the facts alleged in this complaint, this Court cannot say with legal certainty

that Defendants’ alleged actions do not rise to the level of even the higher degree of scrutiny

for IIED under Pennsylvania law. A reasonable trier of fact may find that Defendants’ actions

which allegedly resulted in the incarceration of Plaintiffs for over three months in a detention

facility in Pennsylvania amounted to a sufficient showing of IIED. Accordingly, taking the

factual allegations in the complaint as true, and in a light most favorable to Plaintiffs, this Court

DENIES at this stage Defendants’ motion for judgment on the pleadings of Plaintiffs’ IIED

claim for events that arose in Pennsylvania.

3. Negligence - California (Claim 7)

Defendants next contend that the complaint cannot sustain a cause of action for

negligence under California law because of the “absence of sufficient allegations of physical

impact or physical injury [which] bars the recovery of emotional distress damages when a

defendant’s conduct is merely negligent.” Doc. No. 75 at 17, citing to Erlich v. Menezes, 21

Cal.4th 543, 558-59 (1999); Branch v. Homefed Bank, 6 Cal.App.4th 793, 800-01 (1992);

Simmons v. Pacor, Inc., 674 A.2d 232, 236-37 (Pa. 1996). In response, Plaintiffs contend that

the complaint sufficiently alleges that they “suffer and continue to suffer severe emotional and

mental distress, anguish, humiliation, embarrassment, fright, shock, pain, discomfort and

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anxiety.” Doc. No. 81 at 19, citing to complaint. Plaintiffs also argue that Defendants are

incorrect in their assertions that pecuniary loss, such as loss of earnings, cannot be recovered

under a negligence action. Id. at 19. Finally, Plaintiffs assert that Burgess v. Superior Court,

2 Cal.4th 1064 (1992) allowed for recovery in the absence of alleged physical harm where

Plaintiffs allege “serious emotional distress.” Id. at 20, citing to Burgess, 2 Cal.4th at 1079. In

reply, Defendants rebut that “pain and suffering” are physical injuries under California law.

Doc. No. 83 at 9. Instead, Defendants assert that emotional distress subsumes such injury,

including physical pain. Id., citing Deevy v. Tassi, 21 Cal.2d 109, 120 (1942). Defendants

also reply that Plaintiffs, as employees, are not owed any special duty because of a pre-existing

relationship, and thus argue that Plaintiffs also fail to show causation and duty as required

under a negligence claim.

To assert a cause of action for negligence under California law, a party must show a duty

owed to plaintiff, and a breach of that duty which resulted in damages to plaintiff. In Potter

v. Firestone Tire & Rubber Co., 6 Cal.4th 965 (1993), the California Supreme Court reiterated

the general rule that the lack of physical injury does not bar a party’s claim for negligent

infliction of emotional distress. Id. at 986. (“Significantly, we recently reaffirmed the principle

that in California, ‘damages for negligently inflicted emotional distress may be recovered in the

absence of physical injury or impact.’”), citing to Burgess, 2 Cal.4th at 1074. In addition, the

California Supreme Court made clear that such a principle did not require the establishment

of a “pre-existing relationship.” Id. (“Contrary to amici curiae’s assertions, this principle has

never been restricted to cases involving bystanders or preexisting relationships.”). Accordingly,

to the extent that Defendants argue Plaintiffs’ cause of action for negligent infliction of

emotional distress fail under California law for lack of pleading physical injury and lack of a preexisting relationship, this Court finds Defendants’ arguments unpersuasive.

Defendants also argue that Plaintiffs can prove no proximate cause or duty to sustain a

negligence cause of action. Doc. No. 83 at 9. Plaintiffs rebut Defendants’ contention, stating

that under California law, “Defendants owed Plaintiffs a duty to protect them from foreseeable

harm arising from their employment.” Doc. No. 81 at 21. In reply, Defendants state that an

employer-employee relationship does not automatically create a duty by the employer for

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negligence purposes. Doc. No. 83 at 9 fn. 17.

In Souza v. Pratico, 245 Cal.App.2d 651 (1966), the court analyzed whether the creation

of unsafe work conditions breached a duty of the “employer owed to his employee to provide

a safe place to work.” Id. at 661-62. The Souza court answered in the affirmative, finding that

“negligence in this respect ... proximately contributed to the employee’s injuries.” Id. Turning

to the factual allegations in the complaint and taking them as true and in a light most favorable

to Plaintiffs, the Court finds that Plaintiffs sufficiently alleged a proximate cause or duty in

their complaint by disclosing that despite the knowledge of the dangerous situation repeatedly

created by Defendants, Plaintiffs were continually exposed to these dangerous situations. For

example, Defendants’ alleged actions of forcing Plaintiffs to participate in the interrogation of

Turkish soldiers, notwithstanding knowing the dangers of such actions, created an unsafe

environment for Plaintiffs, thereby proximately causing any injuries that flowed from

Defendants’ actions. Accordingly, for the reasons stated above, this Court DENIES

Defendants’ motion for judgment on the pleadings of Plaintiffs’ claims for negligence arising

from actions taking place in Iraq.

4. Negligence - Pennsylvania Actions (Claim 7)

In contrast to California, however, Pennsylvania law requires either direct physical injury

flowing from defendant’s negligence, or from plaintiffs being placed in the “zone of danger,”

i.e. where plaintiffs are placed in personal danger of “physical impact because of the direction

of a negligent force against him and where plaintiff actually did fear the physical impact.”

Hough v. Meyer, 2002 WL 1764126 *485 (Pa.Com.Pl. 2002). Under the physical impact rule,

“where ... a plaintiff sustains bodily injuries, even though trivial or minor in character, which

are accompanied by fright or mental suffering directly traceable to the peril in which the

defendant’s negligence placed the plaintiff, then mental suffering is a legitimate element of

damages.” Shumosky v. Lutheran Welfare Services of Northeastern PA, Inc., 784 A.2d 196,

201 (Pa.Super. 2001). Such physical injury, therefore, must manifest itself as a direct result

of the negligent actions defendants allegedly undertook. 

Plaintiffs plead no direct or indirect physical injury as a result of Defendants’ alleged

negligence for actions occurring in Pennsylvania. Plaintiffs only complain that they

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“languish[ed] in incarceration for three and a half months until they were granted asylum.”

Cplt. at ¶ 47. Plaintiffs argue that they did plead pain and discomfort in their complaint.

However, “consequent psychological and emotional pain and suffering” is not compensable

under a negligence claim without suffering some physical injury as a direct result of a

defendant’s actions. Additionally, Plaintiffs do not allege that Defendants actions in

Pennsylvania placed Plaintiffs in a “zone of danger” under Pennsylvania law. Botek v. Mine

Safety Applicance Corp., 531 Pa. 160 (1992). Accordingly, this Court GRANTS Defendants’

motion for judgment on the pleadings of Plaintiffs’ claim for negligence for actions arising in

Pennsylvania.

5. Punitive Damages - California Law (Claim 7)

Defendants finally contend that Plaintiffs cannot recover punitive damages under a

negligence theory. Doc. No. 75 at 19. Defendants assert that the complaint fails to allege

Defendants’ actions rise to the level necessary for punitive damages, i.e. a showing of

oppression, fraud or malice. Id. Plaintiffs rebut Defendants’ contentions, asserting instead that

“California law holds that where non-intentional torts involve conduct performed without an

intent to harm, punitive damages may still be assessed ‘when the conduct constitutes conscious

disregard of the rights or safety of others.’” Doc. No. 81 at 21, citing to Ford Motor Co. v.

Home Ins. Co., 116 Cal.App.3d 374, 381 (1981). In Ford, the California appellate court found

that non-intentional conduct could also give rise to punitive damages provided that a party

“performs an act from which he knows, or should know, it is highly probable that harm will

result.” Id.

In the instant matter, Plaintiffs’ complaint sufficiently alleges that, amongst other

actions, Defendants knew or should have known that causing Plaintiffs to participate in the

interrogation of Turkish army soldiers would result in probable harm to Plaintiffs. As Plaintiffs

assert, “Defendants were aware ... that such an act would greatly anger the Turkish military and

government and that great harm could result to any Turkish interpreter who was in Iraq,

including Plaintiffs, if a Turkish citizen was used to assist in interrogations of Turkish soldiers.”

Cplt. at ¶ 38. Accordingly, because the complaint sufficiently alleges Defendants’ conscious

disregard of the safety of Plaintiffs and that Defendants’ actions placed Plaintiff in great harm,

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this Court DENIES Defendants’ motion for judgment on the pleadings of Plaintiffs’ claims for

punitive damages.

C. Contract Issues - (Claims 3-5)

Defendants finally assert that Plaintiffs’ claims in Claim 4 arising from an alleged breach

of an oral contract should also fail. Doc. No. 75 at 20. Defendants first assert that choice-oflaw principles reflect that California law should apply in the instant matter. Id. Defendants

contend that under California law, the statute of frauds bars Plaintiffs’ actions for oral

employment contracts that lasts over one year. Id. at 22. Defendants also claim that the

alleged oral terms for compensation are too uncertain to give rise to an enforceable contract.

Id. at 23. In addition, Defendants assert that Plaintiffs do not state a claim for promissory

estoppel in Claim 3. Id. at 25. Defendants do not provide any argument, discussion or analysis

in support of their request for dismissal of Claim 5, breach of covenant of good faith and fair

dealing. Finally, Defendants contend that Plaintiffs’ claim for contract damages are limited,

and that no punitive damages can lie for breach of contract. Id. at 28, 32.

1. Choice of Law

Defendants present an analysis under both California Civil Code § 1646, as well as a

governmental interest analysis, to support their assertion that California law should apply in

the instant matter. Doc. No. 75 at 20. Plaintiffs do not rebut this contention. Doc. No. 81

at 23.

California Civil Code § 1646 states: 

A contract is to be interpreted according to the law and usage of the place where it is to be performed; or, if it does not indicate a place of performance, according to the law and usage of the place where it is made.

In the complaint, Plaintiff Dalkilic asserts that the work orally contracted for would take place

in Iraq. See Cplt. at ¶¶ 17-18. Plaintiff Celik asserts that he was employed by Defendants for

work in Mardin, Turkey, as well as in Iraq, but the oral contract complained of would consist

of work in Iraq. See id. at ¶¶ 26-28. Again, as both parties point out, Coalition Provisional

Authority No. 17 provides “that government contractors are not subject to Iraqi law” for

contract and tort claims, and therefore by default California law as the law of the forum state

applies. Doc. No. 75 at 22; Doc. No. 81 at 10 (“CPA No. 17 precludes any sort of conflict

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between California and Iraqi law). Accordingly, under § 1646, California law would apply.

Under a governmental interest analysis, California law would also apply. With contract

choice-of-law questions, California looks at the relevant contacts to determine the choice of law

to apply. Janzen v. Workers’ Compensation Appeals Bd., 61 Cal.App.4th 109, 115 fn. 3

(1997).

California follows a “governmental interests” approach to choice of law questions. Section 188, subdivision (2) of the Restatement Second of Conflict of Laws lists the

following relevant contacts: “(a) the place of contracting, (b) the place of negotiation of the contract (c) the place of performance, (d) the location of the subject matter of the contract, and (e) the domicile, residence, nationality, place of incorporation and place of business of the parties.” Under the governmental interests approach, these factors are examined “in connection with the analysis of the interest of the involved state in the

issues, the character of the contract and the relevant purposes of the contract law under consideration.”

Id. (citations omitted). Applying a governmental interest analysis, this Court finds that

California law would apply to the contracts at issue in the instant matter. Accordingly, this

Court will apply California law.

2. Statute of Frauds

Defendants assert that the statute of frauds bars Plaintiffs’ alleged oral contracts in Claim

4, because it bars contracts for terms that exceed one year. Doc. No. 75 at 22. Defendants

point out as support that Plaintiffs in their complaint “contend that they were verbally

promised a job for a minimum of five years (and up to a maximum of ten years).” Id. 

Plaintiffs in response contend first that the oral employment contract would not be barred

under the statute of frauds because it “could have been terminated within one year.” Doc. No.

83 at 24. Plaintiffs also assert that the doctrine of equitable estoppel precludes Defendants

from claiming that the statute of frauds bars any relief to Plaintiffs. Id.

The statute of frauds in California bars relief where the duration of a contract exceeds

one year. See Cal. Civ. Code § 1624 (A contract is invalid if by “agreement that by its terms

is not to be performed within a year from the making thereof.”). Plaintiffs suggest that § 1624

does not apply to the instant oral contracts because Abeyta v. Superior Court, 17 Cal.App.4th

1037 (1993), found that the statute “‘applies only to contracts which by their terms, cannot

possibly be performed within one year.’” Id. at 683, quoting White Lighting Co. v. Wolfson,

68 Cal.2d 336 (1968). In Abeyta, the appellate court noted that the California Supreme Court

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6 Because this Court finds that the statute of frauds does not apply, the Court will not reach Plaintiffs’

assertions of equitable estoppel.

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in Foley v. Interactive Data, 47 Cal.3d 654 (1988), rejected the lower court’s dismissal on

statute of frauds grounds of plaintiff’s oral employment contract claims, stating:

Even if the original oral agreement had expressly promised plaintiff “permanent” employment terminable only on the condition of his subsequent poor performance or other good cause, such an agreement, if for no specified term, could possibly be completed within one year. Because the employee can quit or the employer can discharge for cause, even an agreement that strictly defines appropriate grounds for discharge can be

completely performed within one year-or within one day for that matter.

Id. at 1043, quoting Foley, 47 Cal.3d at 671. The appellate court in Abeyta went on to cite

other cases that went beyond such terms, including cases that rejected the statute of frauds for

oral employment contracts that promised “permanent employment” as long as the party

performed satisfactorily. 17 Cal.App.4th at 1042-43, citing to Foley, 47 Cal.3d at 673, Carnig

v. Carr, 167 Mass. 544 (1897).

Defendants in reply state that Abeyta is inapposite to the instant matter because the

contract in Abeyta contained an oral option for early termination. Doc. No. 83 at 11. The

Court notes that Abeyta, however, cites to numerous cases with no early termination option,

and states that courts have rejected the application of statute of frauds because “a plaintiff

could have (1) been discharged for cause; 2) retired, died or voluntarily left employment; or (3)

been terminated if declining profitability compelled a general layoff or cessation of business

altogether.” 17 Cal.App.4th at 1042. Defendants’ arguments, therefore, are unpersuasive.

Defendants also cite to Munoz v. Kaiser Steel Corp., 156 Cal.App.3d 965 (1984) as

support for its position that Plaintiffs’ oral contract are barred by the statute of frauds. Munoz,

however, relies on the California Supreme Court’s decision in Ruinello v. Murray, 36 Cal.2d

687 (1951), which predates the Supreme Court’s decision in Foley. Munoz, therefore, does not

appear to be reflective of the current state of California statute of frauds case law. Accordingly,

for the reasons stated above, this Court rejects Defendants’ argument that the statute of frauds

bars Plaintiffs’ alleged oral contract.6

3. Uncertainty of Terms

Defendants next contend that Plaintiffs’ oral contracts fail because of the uncertainty of

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terms of the contract. Doc. No. 75 at 23. Defendants assert that the compensation claimed,

as well as the promises of hazard pay and equivalency, are too unspecified to form the basis of

a contract. Id. at 24-25. Plaintiffs in response assert that the factual allegations contained in

the complaint are specific enough to form the basis of a contract at this stage in the litigation.

Doc. No. 81 at 28.

“To form a contract, an ‘offer must be sufficiently definite ... that the performance

promised is reasonably certain.’” Alexander v. Codemasters Group Ltd., 104 Cal.App.4th 129

(2002). “The phrase ‘reasonably certain’ means the terms ‘provide a basis for determining the

existence of a breach and for giving an appropriate remedy.’” Id., citing to Rest.2d Contracts,

§ 22, subd. (2). “This definition of the requirement of certainty has been described as involving

two questions: ‘[F]irst, did the parties intend to contract and second, is there a reasonably

certain basis for giving an appropriate remedy.’” Id., citing to 1 Williston on Contracts (4th ed.

1990) § 4:18, p. 425. 

In the instant matter, the Court finds that, taking the factual allegations in the complaint

as true and in a light most favorable to Plaintiffs, the contract terms here were sufficiently

definite to form a contract. Plaintiffs in the complaint point to definite salary terms, and point

to the existence of specific bonuses, hazard pay and medical and social security benefits. See

Cplt. at ¶ 19 and 27. That the amount of bonuses and other benefits is not specifically named

or identified is not fatal to Plaintiffs’ claim. See Sabatini v. Hensley, 161 Cal.App.2d 172, 175

(1958) (“The failure to specify the amount or a formula for determining the amount of the

bonus does not render the agreement too indefinite for enforcement.”). Additionally, it is not

fatal to Plaintiffs’ claim that the amount of consideration is not specified. See id., citing to Cal.

Civ. Code § 1610 (“It is not essential that the contract specify the amount of the consideration

or the means of ascertaining it.”). Accordingly, this Court rejects Defendants’ assertions that

the oral contract alleged is indefinite and unenforceable.

4. Promissory Estoppel

Defendants next assert that Plaintiffs’ claim for promissory estoppel in Claim 3 fails

because they fail to allege sufficient facts to support a claim for promissory estoppel. Doc. No.

75 at 25. In response, Plaintiffs contend that their claim for promissory estoppel is sufficiently

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pled, and is also being asserted as an alternative liability claim should a trier of fact find

insufficient consideration for an oral contract. Doc. No. 83 at 29.

Under California law, the elements of a promissory estoppel claim are: 1) a clear and

unambiguous promise; 2) reasonable and foreseeable reliance by the party asserting the claim;

and 3) injury as a result of a reliance on this promise. U.S. Ecology, Inc. v. Cal., 129

Cal.App.4th 887, 901 (2005). In the complaint, Plaintiffs specify the terms of the promise,

including the salary promised, per diem and hazard pay, social security payments, adequate

security and promises of obtaining the specific permission from the Turkish government for

work in Iraq. Cplt. at ¶ 66. Plaintiffs additionally state that it was reasonable and foreseeable

that Plaintiffs would rely on the promises in order to be “convinced” to work in Iraq. See Cplt.

at ¶ 19-22, 27. Finally, Plaintiffs assert injury as a result of their reliance on the promise. See

Cplt. at ¶ 70. Accordingly, this Court rejects Defendants’ arguments and finds promissory

estoppel was sufficiently pled by Plaintiffs in the instant complaint.

5. Contract Damages

Defendants next contend that Plaintiffs’ alleged contract damages are limited only to

“the difference between what they were promised and what they actually received for the time

employed.” Doc. No. 75 at 28. Defendants assert that Plaintiffs are not entitled to: 1)

emotional distress damages; and 2) punitive damages for any alleged breach of contract. Id. at

29-30. In addition, Defendants allege that the interrogation of Turkish military officers was

an unforeseeable consequence, and therefore cannot form the basis of any contract damages.

Defendants also contend that Plaintiffs are not entitled to damages for future pay or reliance

damages, and at most are entitled to a benefit of the alleged bargain damages. Id. at 33-35.

Plaintiffs rebut Defendants’ contentions, asserting instead that they are entitled to emotional

distress damages, punitive damages, damages extending from their participation in the

interrogation of the Turkish military officers, future pay damages and reliance damages. Doc.

No. 81 at 31. 

a. Emotional Distress Damages

Defendants assert that Plaintiffs are not entitled to emotional distress damages for any

alleged breach of contract. Doc. No. 75 at 28. Defendants contend that “[r]ecovery for

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emotional disturbance [in contract cases] will be excluded unless the breach also cause bodily

harm or the contract or the breach is of such a kind that serious emotional disturbance was a

particularly likely result.” Id., citing to Applied Equip. Corp. v. Litton Saudi Arabia Ltd., 7

Cal.4th 503, 515 (1994). In response, Plaintiffs argue that the complaint alleges sufficient facts

that rise to the level of damages such that “serious emotional disturbance was a particularly

likely result.” Doc. No. 81 at 31, citing to Erlich v. Menezes, 21 Cal.4th 543, 548 (1999).

Plaintiffs also cite to several cases where the “contract at issue did not risk subjecting plaintiffs

to nearly the level of emotional distress damages that Plaintiffs faced here.” Id. at 32, citing to

Windeler v. Scheers Jewelers, 8 Cal.App.3d 844, 852 (1970); Rogoff v. Grabowski, 200

Cal.App.3d 624, 633 (1988).

While the general rule is that emotional distress damages are not recoverable for breach

of contract, recovery for emotional disturbance may occur if the “breach also caused bodily

harm or the contract or the breach is of such a kind that serious emotional disturbance was a

particularly likely result.” Erlich, 21 Cal.4th at 558, citing to Rest.2d Contracts § 353. In

Erlich, the California Supreme Court identified several cases where breach of a contract rose to

the level of a “serious emotional disturbance,” including: Burgess, 2 Cal.4th 1064 (infant

injured during childbirth); Molien, 27 Cal.3d 916 (misdiagnosis and subsequent failure of

marriage); Kately v. Wilkinson, 148 Cal.App.3 576 (1983) (fatal waterskiing accident); Chelini,

32 Cal.2d 480 (failure to adequately preserve a corpse); Wynn v. Monterey Club, 111

Cal.App.3d 789 (1980) (agreement to exclude husband’s gambling-addicted wife from clubs);

Ross v. Forest Lawn Memorial Park, 153 Cal.App.3d 988 (1984) (breach of agreement to keep

burial service private and to protect grave from vandalism); Windeler v. Scheers Jewelers, 8

Cal.App.3d 844 (1970) (loss of jewelry with great sentimental value).

In comparing the factual allegations of the complaint and these cases, and taking the

factual allegations in the complaint as true and in a light most favorable to Plaintiffs, this Court

finds that a reasonable fact finder may determine that Plaintiffs’ complaint rises to the level of

allowing emotional distress damages for breach of contract. As discussed, Plaintiffs allege that

Defendants breached the agreement of providing security for Plaintiffs while working as

interpreters in Iraq, and that they would provide the necessary government approvals for

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Plaintiffs to travel and work in Iraq. The complaint alleges Defendants failed to do so,

subjecting Plaintiffs to extreme harm while in Iraq, as well as the inability to return back to

their home country. It is reasonable that a trier of fact may find these allegations rise to the

level of causing a “serious emotional disturbance.” Accordingly, this Court DENIES

Defendants’ motion for judgment on the pleadings of Plaintiffs’ claim for emotional distress

damages as a result of a breach of the alleged oral employment contract.

b. Punitive Damages

Defendants also assert that punitive damages are not recoverable for an alleged breach

of an oral contract. Doc. No. 75 at 30. Plaintiffs rebut, stating that “punitive damages are

recoverable ... where the breach is also a tort for which punitive damages are recoverable.” Doc.

No. 81 at 32, citing to Quigely v. Pet, Inc., 162 Cal.App.3d 223 (1984). Because this Court

finds that Plaintiffs’ tort claims survive, the Court also DENIES Defendants’ motion for

judgment on the pleadings of Plaintiffs’ claim for punitive damages.

c. Turkish Military Interrogation

Defendants next contend that any harm arising from the interrogation of Turkish

military personnel was not a foreseeable consequence, and thus cannot be a breach of any

alleged oral contract. Doc. No. 75 at 30. In response, Plaintiffs assert that the oral contract

agreed upon called for “translation services for a variety of tasks, including translating

newspapers and dealing with local merchants.” Doc. No. 81 at 33. Plaintiffs further allege that

the complaint sufficiently states that it was reasonably foreseeable that Plaintiffs lives would

be in danger if forced to interrogate Turkish military officers, and that the danger to Plaintiffs

was compounded because Defendants did not obtain the Turkish government’s permission prior

to arriving in Iraq. Id. 

The California Supreme Court has long recognized that damages for “unanticipated

injury” are not recovery under a breach of contract liability theory. Hunt Bros. Co. v. San

Lorenzo Water Co., 150 Cal. 51, 56 (1906). “Parties may voluntarily assume the risk of

liability for unusual losses, but to do so they must be told, at the time the contract is made, of

any special harm likely to result from a breach.” Lewis Jorge Cost. Management, Inc. v.

Pomona Unified School Dist., 960, 970 (2004). 

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7 Defendants provide a declaration from Attorney Cerrahoglu refuting Plaintiffs’ allegations that the

Turkish government requires prior approval before entering Iraq. Doc. No. 75 at 31. The Court will not

consider Cerrahoglu’s declaration refuting Plaintiffs’ factual allegations without converting the instant motion

into one under Rule 56. Because Plaintiffs have not had an opportunity for discovery or to refute Cerrahoglu’s

statements, this Court declines to convert Defendants’ motion at this time.

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Taking the factual allegations in the complaint as true, and in the light most favorable

to Plaintiffs, this Court finds that the complaint sufficiently alleges reasonable foreseeability by

Defendants of the alleged harm that arose to Plaintiffs as a result of Defendants’ breach.

Plaintiffs assert in the complaint that the contract called for translating services, which included

“translating newspapers and dealing with local merchants.” Cplt. at ¶ 24. Plaintiffs further

allege in the complaint that it was “illegal for the Turkish interpreters to enter Iraq without

government approval.”7

 Id. at ¶ 29. Finally, the complaint alleges that Defendants forced

Plaintiffs to interrogate the Turkish military officers in Kirkuk, Northern Iraq, which was an

area of great tension between the Turkish government and the occupants of Northern Iraq, and

despite the fact that Defendants had other non-Turkish employees who could perform the

translating work. A reasonable person could conclude from Plaintiffs’ nationality and origin,

as well as the surrounding war environment and posture of the political and military relations

between Turkey and Northern Iraq, that Defendants could reasonably foresee the consequences

of allegedly forcing Plaintiffs to participate in the interrogation the Turkish military officers,

and the danger in which Plaintiffs were placed as a result of Defendants’ actions. The harm

resulting from the alleged breach of contract is thus reasonably foreseeable. Accordingly, this

Court DENIES Defendants’ motion to dismiss Plaintiffs’ breach of contract claims as not

reasonably foreseeable.

d. Future Pay

Defendants contend that Plaintiffs are not entitled to future pay damages. Doc. No. 75

at 32. Defendants assert that “‘[w]here, after a contract is made, a party’s performance is made

impracticable without his fault by the occurrence of an event the non-occurrence of which was

a basic assumption on which the contract was made, his duty to render that performance is

discharged, unless the language or the circumstances indicate the contrary.” Id., quoting Rest.

Contracts § 261. Defendants argue that because the U.S. Government forced the termination

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of the contract, Defendants should not be held liable and thus forced “to continue employing

Plaintiffs after the U.S. government’s termination of the underlying contract ended the explicit

and understood purpose of the parties’ alleged agreement.” Id. In response, Plaintiffs allege

that Defendants cannot rely on the doctrine of impracticability because it was through

Defendants’ actions that the government terminated the interpreter contract services. Doc. No.

81 at 34.

Whether or not the doctrine of impracticability bars recovery of future pay damages by

Plaintiffs is dependent upon whether “without his fault by the occurrence of an event the nonoccurrence of which was a basic assumption on which the contract was made.” See Rest.2d

Contracts § 261. As discussed, the Court has already found that it was reasonably foreseeable

to Defendants that Plaintiffs would be in danger if allegedly forced to interrogate Turkish

military officers in Kirkuk. In addition, the complaint alleges that Defendants were aware of

this danger, and therefore are at fault for the consequences that occurred, including the directed

termination of Plaintiffs’ services by the U.S. military as a result of the “negative publicity

generated in Turkey by the interrogation of the Turkish soldiers and the danger the Turkish

interpreters faced if they remained in Iraq.” Cplt. at ¶ 38, 44. Accordingly, taking the factual

allegations as true and in a light most favorable to Plaintiffs, the Court finds that the complaint

sufficiently alleges that Defendants were at fault for the resulting consequences, including the

termination of the use of Turkish interpreters, and thus DENIES Defendants’ motion for

judgment on the pleadings to bar Plaintiff from claiming future pay as damages.

e. Reliance Damages

Defendants finally assert that Plaintiffs are not entitled to reliance damages because the

damages claimed are too “speculative, remote, contingent or merely possible”, and are not based

upon “substantial evidence.” Doc. No. 75 at 33. Defendants contend that Plaintiffs’ assertions

that they “would have been gainfully and continuously employed in Turkey during the period

of March to July 2003 - let alone for their entire lives - or that they would have been earning

an amount greater than $1500 per month in Turkey would be wholly conjectural and

speculative.” Id. In response, Plaintiffs assert that at this stage in the litigation “Plaintiffs are

not required to set forth precise numbers and facts including all of the details of their past lives

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to prevail on a motion to dismiss.” Doc. No. 81 at 35.

As stated, on a motion for judgment on the pleadings, this Court must accept as true all

factual allegations in the complaint. Plaintiffs here have alleged that they are entitled to loss

of earnings, including future pay, as a result of Defendants’ alleged breach of the oral contract.

Plaintiffs should not be required to prove their damages in opposition to this motion to the

extent that Defendants now claim, and thus such a claim by Defendants cannot form the basis

of a dismissal at this stage. For these reasons, this Court DENIES Defendants’ motion for

judgment on the pleadings of Plaintiffs’ future pay damages. 

CONCLUSION AND ORDER

For the foregoing reasons, IT IS HEREBY ORDERED that Defendants’ motion for

judgment on the pleadings [Doc. No. 75] is GRANTED IN PART and DENIED IN PART:

1. Defendants’ motion for judgment on the pleadings of Plaintiffs’ First and Second

causes of action for fraud and deceit and negligent misrepresentation is

GRANTED. 

2. Defendants’ motion for judgment on the pleadings of Plaintiffs’ Third

(promissory estoppel); Fourth (breach of oral contract); Fifth( breach of the

covenant of good faith and fair dealing); and Sixth (intentional infliction of

emotional distress) causes of action is DENIED. 

3. Defendants’ motion for judgment on the pleadings of Plaintiffs’ Seventh cause of

action for negligence is GRANTED IN PART and DENIED IN PART.

Defendants’ motion is GRANTED for events occurring in Pennsylvania only. For

all other actions occurring outside of Pennsylvania, Defendants’ motion is

DENIED.

IT IS SO ORDERED.

DATED: August 29, 2007

HON. JOHN A. HOUSTON

United States District Judge

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