Unreported / Non-Citable
Background
Ndidi Anofienem, representing herself, sued WeWork Companies LLC and a related landlord entity in Los Angeles County Superior Court. She alleged she paid for a WeWork membership for her nonprofit, never received a signed member agreement despite repeated requests, had her membership canceled without notice, and lost more than $1,200 of personal property she said WeWork would not return. She also said she spent more than 300 hours searching for replacement office space.
Her seven-count complaint alleged breach of contract, breach of the implied covenant of good faith and fair dealing, conversion, intentional and negligent infliction of emotional distress, violation of the federal Electronic Signatures in Global and National Commerce Act (the “E-SIGN Act”), and violation of California’s Unruh Civil Rights Act. WeWork removed the case to federal court on diversity grounds and moved to dismiss every claim. Plaintiff sought remand and opposed dismissal.
The Court’s Holding
The court denied remand and granted the motion to dismiss in significant part. On jurisdiction, the court found complete diversity using a sworn declaration from corporate counsel that walked through WeWork’s LLC ownership chain — five entities ultimately owned by a Delaware corporation headquartered in New York — and noted the complaint itself sought general and special damages “in an amount exceeding $100,000,” comfortably above the $75,000 threshold.
On the merits, the court dismissed five state-law claims with leave to amend. The contract claim failed because Plaintiff did not plead facts showing a meeting of the minds or specify which defendant agreed to what. The implied-covenant claim failed for the same reason and because she did not allege any benefit was withheld. The conversion claim failed because she described her property only as “personal belongings” without identifying what was taken. The IIED and NIED claims failed because her boilerplate distress allegations did not approach the “extreme and outrageous” conduct standard or plead a plausible duty of care.
Two federal-flavored claims were dismissed permanently. The E-SIGN Act claim — that WeWork violated the federal e-signature statute by failing to provide an electronically signed agreement — was dismissed without leave to amend because the E-SIGN Act creates no private right of action; it merely prevents agreements from being denied legal effect because they are electronic. The Unruh Civil Rights Act claim was dismissed without leave to amend because Plaintiff alleged discrimination only conditionally — “[i]f discrimination occurred based on race, gender, or other protected characteristics” — which the court held cannot supply the factual context required to plead intentional discrimination, the “must” element of an Unruh claim. The court noted she had already failed to cure the same defect in a prior related case (Anofienem I).
Key Takeaways
- For LLC defendants, “competent proof” of citizenship can include a sworn declaration from corporate counsel walking through the ownership chain to an ultimate corporate owner.
- A complaint that demands monetary relief in an amount “exceeding $100,000” supplies the federal amount in controversy on its face.
- The E-SIGN Act creates no private right of action; it cannot be used as a sword to attack electronic agreements.
- An Unruh Civil Rights Act claim requires more than conclusory allegations — and certainly more than conditional “if discrimination occurred” language. Plaintiffs must plead facts that plausibly suggest intentional discrimination.
- Conversion claims must specify what property was taken; “personal belongings” is not enough at the pleading stage.
- Boilerplate emotional-distress allegations untethered to extreme-and-outrageous conduct or a recognized duty will not survive a motion to dismiss.
Why It Matters
This decision is a useful checkpoint for anyone considering a federal lawsuit based on an electronic-signature dispute, an Unruh Civil Rights Act claim, or a coworking-space contract dispute. The court’s firm rejection of any private right of action under the E-SIGN Act mirrors a growing consensus across federal courts that the statute is purely a defensive shield against arguments that electronic agreements lack legal effect, not a basis for damages.
For California businesses on the customer-facing side, the decision underscores that conditional or speculative discrimination allegations cannot reach the federal pleading bar — Unruh Act plaintiffs must connect specific facts to a plausible inference of intentional discrimination. For pro se litigants, the order is a reminder that emotional-distress and conversion claims need concrete facts, not adjectives, and that adding a federal claim purely to invoke federal-question jurisdiction will rarely work where the statute provides no private remedy.