Pollak, Vida & Barer

In Black v. Los Angeles County Metropolitan Transportation Authority, published December 2, 2025, the appellate court reversed a dismissal after demurrer. The plaintiff sued Public Transportation Services Corporation alleging wrongful termination in violation of public policy and violation of Labor Code section 970. The corporation moved for judgment on the pleadings on the ground the plaintiff failed to plead compliance with the claims presentation requirements of the Government Claims Act. The corporation also argued that as a public entity it was immune from common law liability for wrongful termination in violation of public policy and misrepresentation under section 970. The plaintiff argued the corporation, as a nonprofit public benefit corporation, is distinct from a public corporation and therefore not protected by the Government Claims Act. The trial court granted the motion with leave to amend, ruling that the corporation was a public corporation or public agency. The plaintiff filed an amended complaint, alleging wrongful termination, Labor Code violations, and breach of contract, with no allegations concerning claim presentation. The corporation filed a demurrer. The plaintiff argued both that the corporation was not a public entity and that claim compliance was excused under Government Code section 946.4 because there was no evidence the corporation was listed on the Registry of Public Agencies as required by Government Code section 53051. The corporation argued that the corporation was the organizational unit of a transportation authority, and that a subdivision need not comply with section 53051. The trial court sustained the demurrer without leave to amend. It ruled that the corporation was a public entity, and that the plaintiff had failed to show that it had to register separately from the transit authority. It alternatively ruled that the plaintiff had raised the registration theory for the first time in its opposition and had not pleaded facts to support it. The plaintiff appealed.

The appellate court agreed with the trial court that the corporation is a public entity for purposes of the claim-presentation requirements. The Legislature formed the transit authority by merging two existing agencies, and granted it authority to establish subsidiary units or similar entities and delegate power to them. To resolve issues regarding the retirement benefits of the merged agencies, the transit authority formed a new entity, the corporation, a government nonprofit public benefit corporation, which entered into a contract with PERS to provide retirement benefits to employees. Determining public entity status for purposes of the Government Claims Act requires case-specific analysis. Here, the corporation was created by a governmental entity, the transit authority; was created pursuant to statute; has authority and responsibility limited by the Authority’s administrative code; and acts as an instrument of the authority. A nonprofit public benefit corporation can be a public entity if its attributes resemble those of a public entity. An entity can qualify as a public entity for purposes of the Act despite not having the powers of taxation or eminent domain. Whether an entity is a public entity calls for a multi-faceted inquiry, and the entity’s powers are not the only indicia. The appellate court therefore determined that the demurrer was properly sustained. But it further ruled that the plaintiff is entitled to amend his complaint to allege that the corporation has not demonstrated it satisfied its obligation to register on the Registry of Public Agencies, which failure would excuse the plaintiff from presenting a prelitigation claim. When a plaintiff alleges a public agency has not complied
with the registration requirements, it is the public agency’s burden to prove compliance. Defendants did not do so. The appellate court rejected the defendants’ argument and the trial court’s conclusion that the corporation’s relationship with the transit authority excuses it from Government Code section 53051’s registration requirement. By statute, all public agencies must comply with section 53051. There is no statutory or case authority that a public agency may extend its own registered status to another public agency via an administrative code or any other method. Although in supplemental briefing the corporation provided evidence that the corporation did register with the Secretary of State, the corporation did not provide evidence that it also registered with the county clerk in each county in which it maintains an office, as required by Government Code section 946.4(a)(1). Although the plaintiff raised the registration issue for the first time in opposition to demurrer, the court took this as a proffer of how he might amend his complaint to state a claim. The trial court therefore abused its discretion by not granting leave to amend to add allegations concerning the lack of compliance with the registration statutes.