Filed 10/5/26 Wilson v. University of Southern Cal. CA2/4
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IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
SECOND APPELLATE DISTRICT
DIVISION FOUR
JOHN B. WILSON, et al., B349831
Plaintiffs and Appellants, (Los Angeles County
v. Super. Ct. No.
24STCV24447)
UNIVERSITY OF SOUTHERN
CALIFORNIA,
Defendant and Respondent.
APPEAL from a judgment of the Superior Court of Los
Angeles County, Holly J. Fujie, Retired Judge. Affirmed.
Dechert, Steven A. Engel and Jay Bhimani; and Law
Offices of William Charles Tanenbaum and William Charles
Tanenbaum for Plaintiffs and Appellants.
Kendall Brill & Kelly, Robert E. Dugdale and Nary Kim for
Defendant and Respondent.
In March 2019, plaintiff John B. Wilson was indicted, along
with 49 other people, as part of the “Varsity Blues” college
admission scandal. The indictment identified Mr. Wilson as one
of the parties who had conspired to bribe agents of the University
of Southern California (USC) to secure his child’s admission to
that university as an athletic recruit in 2014.
On September 20, 2024, Mr. Wilson and his wife Leslie Q.
Wilson filed a complaint against USC for fraud. The Wilsons
alleged USC falsely represented to them that their donation in
support of their son would not be viewed as illicit or
inappropriate, and would be entirely consistent with USC’s
athletic admissions policies. According to the operative
complaint, those false representations led to Mr. Wilson’s
criminal indictment.
The sole issue in this appeal is whether the complaint
against USC is time-barred. It is undisputed that the alleged
misrepresentations occurred in 2013 and 2014 and thus, under
the default rule, the three-year statute of limitations applicable
to fraud actions expired several years before this action was filed.
(See Code Civ. Proc, § 338, subd. (d).) The Wilsons rely on an
exception to the general rule, known as the delayed discovery
rule, which postpones accrual of a cause of action until the
plaintiff suspects or should suspect that his or her injury was
caused by wrongdoing.
The Wilsons argue their complaint is timely because the
statute of limitations did not begin to run until September 21,
2021, when a USC admissions officer testified at Mr. Wilson’s
criminal trial that financial contributions were not part of the
admissions process for non-scholarship athletes. Before that
2
date, the Wilsons claim, they had no reason to suspect they had
been defrauded by USC.
We conclude the allegations in the operative complaint and
judicially noticeable facts support only one reasonable
conclusion—a reasonable person would have been suspicious of
USC’s alleged fraud based on the 2019 indictment and 2020
superseding indictment. Because these indictments gave the
Wilsons ample reason to suspect the basis of their claims (i.e.,
they were falsely told their donation was common, lawful, and
consistent with USC’s policies), the three-year statute of
limitations began accruing at the latest in 2020. Accordingly,
this action—filed over three years after these indictments—is
time-barred, and USC’s demurrer was properly sustained on that
basis.
BACKGROUND
The trial court took judicial notice of certain documents in
the criminal case against Mr. Wilson. We too take judicial notice
of those documents.1 The following facts are taken from the
operative complaint and judicially noticeable documents.
1 The trial court granted USC’s request to take judicial notice of
the following documents: (1) the criminal complaint and affidavit of
Special Agent Laura Smith in support of the criminal complaint filed
on March 11, 2019 [Case No. 1:19-cr-10080]; (2) the Third Superseding
Indictment in Mr. Wilson’s criminal proceedings; (3) the Fourth
Superseding Indictment in Mr. Wilson’s criminal proceedings; (4) the
information filed in the criminal case captioned United State of
America v. William Rick Singer [Case No. 19-10078-RWZ; (5) the
indictment filed in the criminal case captioned United States of
America v. Jovan Vavic, et al. [Case No. 19-CR-10081-IT]; (6) the
Consolidated Response in Opposition to Defendants’ Motions to
Compel Discovery filed by the government on January 14, 2020 in Mr.
3
I. Facts
A. Underlying factual background
The Wilsons’ son, Johnny Wilson, grew up swimming and
playing water polo. He played for top nationally ranked water
polo teams, and he was a starting player on multiple Stanford
Club teams competing for multiple years in national Junior
Olympics tournaments.
In September 2010, the Wilsons hired William “Rick”
Singer “to help Johnny find the best college for his academic
growth, as a water polo player, and student athlete and to help
tutor and prepare him academically for his top college choices.”
In 2013, the Wilson family visited USC to see whether
Johnny would be a good fit for the team, and met with USC’s
then-water polo coach, Jovan Vavic. Before the trip, Singer told
the Wilsons that nearly all the USC water polo players were
scholarship recruits but that there could be one or two slots for
walk-on recruited players. For those walk-on spots, Singer told
the Wilsons that donating to USC’s Trojan Fund could improve a
non-scholarship athlete-applicant’s chances of admissions.
Wilson’s criminal proceedings; (7) the July 28, 2020 memorandum and
order ruling in Mr. Wilson’s criminal proceedings; (8) the Second
Superseding Indictment filed in the criminal case captioned United
States of America v. Jovan Vavic, et al. [Case No. 19-CR-10081-IT];
(9) excerpts of the certified court reporter’s transcript of day four of Mr.
Wilson’s criminal trial; and (10) excerpts of the docket in Mr. Wilson’s
criminal case, United States v. John Wilson [Case No. 19-CR-10080-
LTS-17]. On appeal, USC renews its request to take judicial notice of
news articles available online, which the trial court denied. We deny
the request because, as USC concedes, its argument on appeal is the
2019 criminal indictment put the Wilsons on inquiry notice—not the
media coverage or USC’s public statements. Those documents are,
therefore, irrelevant to the dispositive issue in this appeal.
4
Singer further advised the Wilsons that because USC is a
nonprofit corporation, “donations to the school through [ ]
Singer’s company or his newly formed foundation would be tax
deductible.” In considering a potential donation to the Trojan
Fund, “the Wilsons liked the practice of donating through [ ]
Singer’s organization to provide a layer of anonymity and to
minimize the volume of future requests from USC or other
institutions for more donations.”
During the Wilsons’ visit to USC, Vavic confirmed what
Singer had told the Wilsons regarding donations to the
university. Specifically, Vavic represented “USC has a policy of
giving an admissions preference and an athletic recommendation
to the applicant child of donor families, who were otherwise
reasonably qualified to participate as a walk-on player on those
teams” and such donations made through Singer “would not be
viewed as illicit or inappropriate.”
After meeting with Vavic, the Wilsons met with USC’s
Assistant Athletic Director Alejandro “Alex” Garfio. Garfio
reported directly to USC’s subcommittee on admissions (SUBCO)
and was personally involved in USC’s athletic admissions
process. Garfio confirmed that USC has an accepted practice of
considering parent donations as part of athletic admissions and
that a donation commitment could help Johnny gain admission to
USC as a non-scholarship student-athlete. He also told the
Wilsons that other parents had donated through Singer’s
organization in prior years and this was “entirely consistent with
USC’s donation policies for non-scholarship athletic admissions.”
On October 12, 2013, Mr. Wilson e-mailed Singer
requesting an update on the college application process. Singer
replied that Vavic had Johnny’s information, and that Vavic
5
asked him “to embellish [Johnny’s] profile more, which [Singer
was] doing.” On October 13, Mr. Wilson asked Singer, “When is
Jovan [Vavic] going to be able to give us decision on USC? And
when do I pay u?”
On or about February 28, 2014, SUBCO approved the
admission of Johnny as a water polo recruit. The following day,
Mr. Wilson thanked Singer “for making this happen!” and asked
Singer to “give [him] the invoice” for payment.
On April 7, Mr. Wilson’s company wired $220,000 to
Singer’s companies, consisting of $100,000 to Singer’s college
counseling company (directed to the USC Trojan Fund); $100,000
paid to Singer’s KWF charitable foundation; and $20,000 paid to
Singer directly.
On July 28, 2014, USC sent a “ ‘Thank You’ letter to the
Wilsons (with [Vavic] carbon copied) thanking the Wilsons for
their $100,000 donation to the USC Trojan Fund.” The Wilsons
did not receive a similar letter for the $100,000 Mr. Wilson paid
to KWF or the $20,000 he paid to Singer directly.
At this point, the Wilsons allege, they had no reason to
suspect they had been defrauded by USC. Johnny was a redshirt
freshman on the 2014 water polo team, but resigned from the
team in early 2015 after suffering a career-ending fourth
concussion.
B. The indictments and Mr. Wilson’s trial
On March 11, 2019, Mr. Wilson and other parents were
arrested for conspiring with Singer and other coaches and staff
members in college athletic departments, like Vavic, to defraud
colleges through the illicit manner in which they gained
6
admission for their children. University employees, including
Vavic, were also arrested and charged.
On March 12, 2019, both Singer’s and Vavic’s indictments
were unsealed. Singer was charged with, among other things,
bribing Vavic to designate two students as water-polo recruits,
“thereby facilitating the students’ admission to USC.” The
indictment further alleged that Singer “[d]irect[ed] purported
charitable donations to KWF, even though those funds were
intended to be used, at least in part, to bribe . . . athletic coaches
and university administrators.”
Vavic was charged with accepting bribes from Singer to
designate “two students as recruits for the water polo team,
thereby facilitating the students’ admission to USC.” The
indictment also stated that Singer used money drawn from his
“KWF charitable accounts” to pay the private school tuition of
Vavic’s children.
On October 22, 2019, a Third Superseding Indictment2
identified Mr. Wilson as one of the parents who had conspired “to
bribe agents of USC to secure their children’s admission to that
university.” As one of the parents accused of participating in the
“USC Federal Programs Bribery Conspiracy,”
On January 14, 2020, a Fourth Superseding Indictment in
Mr. Wilson’s case expressly stated that “USC issued [the thank-
you note for the $100,000 donation] without knowing that
Wilson’s payment was made in exchange for facilitating his son’s
fraudulent admission to USC as a purported recruit.”
2 Between March 11, 2019, and January 14, 2020, the government
filed four superseding indictments against the Varsity Blues
defendants, including Mr. Wilson.
7
In support of the criminal complaint against Mr. Wilson,
the FBI submitted an affidavit, which stated Singer had provided
Vavic “with a falsified profile” for Johnny “that included
fabricated swimming times and awards.” It also declared that
Vavic had provided the “USC athletics administrator” with
“fabricated” statistics “derived from [Johnny’s] falsified athletics
profile.”
Many of the Varsity Blues defendants pled guilty, but Mr.
Wilson maintained his innocence and took his case to trial.
During the trial, on September 21, 2021, Rebecca Chassin, a USC
admissions officer and assistant dean of undergraduate
admissions, testified on behalf of USC. As relevant here, Chassin
testified that the “ ‘Athletics Subcommittee [or SUBCO] is for
athletic talent only, so that’s the only thing that would be
considered in that process,’ and so, donations are not considered
in the SUBCO athletic admissions process.”
II. Pleadings and Procedural History
On September 20, 2024, the Wilsons filed a lawsuit against
USC for fraud and intentional and negligent misrepresentation.
Each cause of action was based on USC’s alleged false
representations to Mr. Wilson regarding the nature of his
payments to Singer and his companies. The Wilsons alleged that
it was not until September 21, 2021, that they “discovered that
they had been defrauded” based on USC’s testifying witness,
Chassin, admitting that “financial contributions were not a
legitimate part of the admissions process for non-scholarship
athletes seeking to join a USC team.” USC’s fraud, the Wilsons
alleged, caused them to incur damages consisting of “the
$100,000 donation to the USC Athletic Fund,” attorney fees
incurred to defend Mr. Wilson in the criminal proceedings, lost
8
income, lost future earnings, and pain and suffering in an
amount in excess of $75 million.
USC filed a demurrer to the Wilsons’ complaint on the
ground the claims were time-barred. The trial court sustained
the demurrer on that ground but granted leave to file an
amended complaint.
The Wilsons subsequently filed a first amended complaint
(FAC), which dropped the negligent misrepresentation claim,
leaving two causes of action for fraud and intentional
misrepresentation. The FAC included additional facts the
Wilsons contend pertain to the discovery rule. We shall discuss
these allegations in detail below.
USC demurred to the FAC. This time the trial court
sustained the demurrer without leave to amend. The trial court
then entered judgment in favor of USC
The Wilsons timely appealed.
DISCUSSION
I. Standard of Review
“The application of an affirmative defense on demurrer
based on facts alleged in the complaint, such as the statute of
limitations, is subject to de novo review.” (Nichols v. Alghannam
(2026) 118 Cal.App.5th 726, 733 (Nichols).) We accept as true the
well-pleaded allegations in the complaint and treat the demurrer
as admitting all material facts properly pleaded. (Association for
Los Angeles Deputy Sheriffs v. County of Los Angeles (2023) 94
Cal.App.5th 764, 776 (Association).) We do not, however, accept
as true contentions, deductions or conclusions of fact or law.
(Ibid.)
“We also consider ‘matters of which judicial notice can and
has been taken.’ ” (Association, supra, 94 Cal.App.5th at p. 776.)
9
“If ‘ “the complaint’s allegations or judicially noticeable facts
reveal the existence of an affirmative defense, the ‘plaintiff must
“plead around” the defense, by alleging specific facts that would
avoid the apparent defense.’ ” ’ ” (Nichols, supra, 118 Cal.App.5th
at p. 733.)
The operative complaint is “ ‘ “read as containing the
judicially noticeable facts, ‘even when the pleading contains an
express allegation to the contrary.’ ” ’ ” (State of California ex rel.
Metz v. CCC Information Services, Inc. (2007) 149 Cal.App.4th
402, 412.) “[W]hen the allegations of the complaint contradict or
are inconsistent with such [judicially-noticeable] facts, we accept
the latter and reject the former.” (Schermer v. Tatum (2016) 245
Cal.App.4th 912, 922–923.)
II. The Statute of Limitations and the Delayed
Discovery Rule
“Generally speaking, a cause of action accrues at ‘the time
when the cause of action is complete with all of its elements.’ ”
(Fox v. Ethicon Endo-Surgery, Inc. (2005) 35 Cal.4th 797, 806
(Fox), citing Norgart v. Upjohn Co. (1999) 21 Cal.4th 383, 397
(Norgart).) “An important exception to the general rule of accrual
is the ‘discovery rule,’ which postpones accrual of a cause of
action until the plaintiff discovers, or has reason to discover, the
cause of action.” (Fox, at p. 807, citing Norgart, at p. 187.)
“A plaintiff has reason to discover a cause of action when he
or she ‘has reason at least to suspect a factual basis for its
elements.’ ” (Fox, supra, 35 Cal.4th at p. 807, citing Norgart,
supra, 21 Cal.4th at p. 398; see also Jolly v. Eli Lilly & Co. (1988)
44 Cal.3d 1103, 1110 (Jolly).) “Rather than examining whether
the plaintiffs suspect facts supporting each specific legal element
of a particular cause of action, we look to whether the plaintiffs
10
have reason to at least suspect that a type of wrongdoing has
injured them.” (Fox, at p. 807.)
“The discovery rule only delays accrual until the plaintiff
has, or should have, inquiry notice of the cause of action.” (Fox,
supra, 35 Cal.4th at p. 807.) “Under the discovery rule, the
statute of limitations begins to run when the plaintiff suspects or
should suspect that her injury was caused by wrongdoing, that
someone has done something wrong to her.” (Jolly, supra, 44
Cal.3d at p. 1110.) “The discovery rule thus ‘sets forth two
alternate tests for triggering the limitations period: (1) a
subjective test requiring actual suspicion by the plaintiff that the
injury was caused by wrongdoing; and (2) an objective test
requiring a showing that a reasonable person would have
suspected the injury was caused by wrongdoing. [Citation.] The
first to occur under these two tests begins the limitations
period.’ ” (Kernan v. Regents of University of California (2022) 83
Cal.App.5th 675, 681.)
III. The Trial Court Properly Sustained the Demurrer
The Wilsons contend the trial court erred by misapplying
the delayed discovery rule standard and that we should apply a
different standard here. Alternatively, the Wilsons contend the
trial court improperly resolved factual issues on demurrer and
that we cannot affirm the judgment without doing the same.
A. The trial court applied the correct legal
framework
We begin with the threshold issue of whether the trial
court applied the correct legal framework. Because we review a
demurrer de novo, we generally do not consider the trial court’s
reasoning. (Rossi v. Sequoia Union Elementary School (2023) 94
Cal.App.5th 974, 985.) Accordingly, even if the trial court’s
11
reasoning were erroneous, we would affirm the judgment if the
ruling were correct for any reason. We need not engage in the
latter analysis, however, because the trial court applied the
correct legal analysis.
Quoting Fox, supra, 35 Cal.4th at p. 803, the Wilsons argue
that under the discovery rule “a cause of action accrues and the
statute of limitations begins to run [1] when the plaintiff has
reason to suspect an injury and some wrongful cause, unless
[2] the plaintiff pleads and proves that a reasonable investigation
at that time would not have revealed a factual basis for that
particular cause of action.” It follows, according to the Wilsons,
that the trial court erred because it “undisputedly failed to apply
the second part of that test.” We are unpersuaded.
Although the Wilsons correctly quote language in Fox, they
added brackets and numbers to the quote. They then
misconstrue the statement in Fox in arguing the trial court only
applied “the first part of the inquiry.” When read in context, Fox
did not create a two-part test.3 Its holding instead delineated a
3 We acknowledge that in Alexander v. Exxon Mobil (2013) 219
Cal.App.4th 1236, 1251 the court cited Fox in dicta for the proposition
that a “two-part analysis is used to assess when a claim has accrued
under the discovery rule.” But this statement simply recognizes that
the statute of limitations is tolled during an investigation after the
plaintiff becomes aware of her injury but before she knows or should
know the factual basis of her claim. (Fox, supra, 35 Cal.4th at p.
808.) Where, as here, the plaintiff knows or should know the factual
basis of her claim when she comes aware of her injury, the court need
not engage in that analysis. In Alexander, the question of whether a
plaintiff’s investigation affects the timing of inquiry notice was not at
issue. Rather, the sole issue was whether a specific document was
sufficiently alarming to put a reasonable person on inquiry notice as a
matter of law. (Id. at p. 1256.) Alexander, therefore, provides no
12
caveat to the discovery rule that does not apply here. Nothing in
Fox changes the general rule that the statute of limitations
begins to run when a reasonable person would have reason to at
least suspect a factual basis for his or her claims.
The Fox court addressed the application of the discovery
rule when an injured plaintiff had reason to suspect “only one
kind of wrongdoing” but no reason to suspect a “wholly different
kind of tortious wrongdoing.” (35 Cal.5th at p. 813.) The plaintiff
in Fox asserted a medical malpractice action against her surgeon.
At the surgeon’s deposition, the plaintiff discovered facts
indicating a product used in the surgery was defective. She could
not have discovered those facts earlier because she was
unconscious during the surgery. The plaintiff then sued the
manufacturer of the product. (Id. at pp. 803−804.)
The product manufacturer urged our Supreme Court to
adopt the “rule of imputed simultaneous discovery of causes of
action.” (Fox, supra, 35 Cal.4th at pp. 811–812.) The court
declined to do so, holding “if a plaintiff’s reasonable and diligent
investigation discloses only one kind of wrongdoing when the
injury was actually caused by tortious conduct of a wholly
different sort, the discovery rule postpones accrual of the statute
of limitations on the newly discovered claim.” (Id at p. 813.)
Unlike in Fox, here, the Wilsons allege a single type of
wrongdoing caused their injury—USC representatives lied to
them about their donation to USC to secure Johnny’s admission,
support for the Wilsons’ position that the statute of limitations does
not run until some point after a reasonable person would have
suspected a factual basis for his or her claims.
13
which led to Mr. Wilson’s criminal prosecution. The holding in
Fox therefore has no application in this case.
The Wilsons contend Fox created a “second part” of a
discovery rule analysis. According to the Wilsons, the trial court
failed to apply this part of the test because “it never explained
how an ensuing ‘investigation would have disclosed a factual
basis for a cause of action’ for fraud or deceit.” (Italics added.)
We reject this argument.
The California Supreme Court said nothing in Fox about
requiring the trial court to “explain how” an investigation would
disclose the factual basis of a claim. Instead, our Supreme Court
cited and affirmed its prior cases on the discovery rule, including
Jolly. (See Fox, supra, 35 Cal.4th at pp. 806, 807, 810, 814.)
As Jolly explained, for inquiry notice to be triggered, “[a]
plaintiff need not be aware of the specific ‘facts’ necessary to
establish the claim; that is a process contemplated by pretrial
discovery. . . . So long as a suspicion [of wrongdoing] exists, it is
clear that the plaintiff must go find the facts; she cannot wait for
the facts to find her.” (Jolly, supra, 44 Cal.3d at p. 1111.)
Neither Jolly nor Fox held that, in applying the discovery rule,
the trial court must identify how the plaintiff would have
ascertained the facts establishing his or her claim.
The Wilsons misconstrue the period an investigation might
delay the running of the statute of limitations. (See Fox, supra,
35 Cal.4th at p. 803.) When the plaintiff becomes “aware of an
injury,” he or she must conduct a reasonable investigation into
the cause of the injury. (Id. at p. 808.) Under the discovery rule,
the statute of limitations begins to run when the investigation
discloses “a factual basis” for a cause of action. (Ibid.) Put
differently, the statute of limitations begins to run when the
14
plaintiff “suspects or should suspect that her injury was caused
by [the defendant’s] wrongdoing” (Jolly, supra, 44 Cal.3d at p.
1110), not when the plaintiff’s investigation confirms the
plaintiff’s suspicions.
The Wilsons are seemingly conflating “a factual basis” for a
claim with having the evidence to prove a claim. But inquiry
notice may be triggered before evidence to prove a claim can be
obtained. This is because a rule that the statute of limitations
only begins running when “a plaintiff is in a position to present
evidence” would “effectively eviscerate the statute of limitations
in all cases in which the plaintiff never discovers ‘smoking gun’
evidence of [wrongdoing].” (Cypress Semiconductor Corp. v.
Superior Court (2008) 163 Cal.App.4th 575, 585-586 (Cypress
Semiconductor).)
B. As a matter of law, the Wilsons had inquiry
notice earlier than three years before they filed
their suit
The Wilsons alternatively contend that even if the trial
court applied the proper legal framework, there were multiple
factual issues that could not be resolved on a demurrer. We
disagree.
“ ‘A plaintiff whose complaint shows on its face that his or
her claim would be barred by the applicable orthodox statute of
limitations, and who intends to rely on the discovery rule to toll
the orthodox limitation period, “must specifically plead facts
which show (1) the time and manner of discovery and (2) the
inability to have made earlier discovery despite reasonable
diligence. [Citations.] Mere conclusory assertions that delay in
discovery was reasonable are insufficient and will not enable the
complaint to withstand general demurrer. [Citation.]”
15
[Citations.].’ ” (Ventura29 LLC v. City of San Buenaventura
(2023) 87 Cal.App.5th 1028, 1044 (Ventura29).)
The law presumes that plaintiffs have knowledge of the
wrongful cause of an injury and places the burden on the plaintiff
to “rebut that presumption” by specifically pleading facts to show
“ ‘ “the inability to have made earlier discovery despite
reasonable diligence.” ’ ” (Grisham v. Philip Morris U.S.A., Inc.
(2007) 40 Cal.4th 623, 638.) “Arguments that discovery-rule
issues are necessarily factual and cannot be resolved on demurrer
have been rejected.” (Ventura29, supra, 87 Cal.App.5th at pp.
1045—1046, citing Camsi IV v. Hunter Technology Corp. (1991)
23 Cal.App.3d 1525, 1536 [citing cases].)
Turning to the present case, the allegations in the FAC and
the judicially noticeable facts show that the Wilsons were put on
inquiry notice of USC’s alleged wrongdoing when Mr. Wilson was
indicted in 2019. Even before the indictment, a reasonable
person in Mr. Wilson’s shoes would have had some concern about
USC’s alleged representations. Mr. Wilson was told to make
three payments to a third party in return for “an admissions
preference” for his son Johnny. Vavic assured him that these
payments—including a $20,000 payment directly to Singer—were
not “illicit” or “inappropriate.” Vavic was either responding to
Mr. Wilson’s inquiry about the propriety of the payments or
Vavic’s statements were gratuitous. If it was the latter, a
reasonable parent would wonder, “Why is he telling me my
‘donation’ is not illicit and compliant with USC policies?” But we
accept as true the Wilsons’ claim that, at this point, they
subjectively and reasonably believed USC’s representations and
were not on inquiry notice of any alleged wrongdoing by USC
officials.
16
This changed in 2019. Mr. Wilson was indicted, among 49
other people, for conspiring to bribe agents of USC to secure
Johnny’s admission. Vavic—USC’s agent who supposedly
assured the Wilsons that their donation was legal and ethical—
was also charged with accepting bribes from Singer to facilitate
students’ admission to USC. Singer, too, was charged with
federal crimes in connection with Mr. Wilson’s payments. Thus,
both sides of the very transaction the Wilsons contend USC
misled them about were charged with committing federal crimes.
These allegations would put a reasonable person on notice that
perhaps Vavic’s statement to Mr. Wilson that his donation was
not “illicit” was false. Likewise, a reasonable person would be
suspicious about Vavic’s and Garfio’s statements that a donation
through Singer—the man at the center of the Varsity Blues
indictments—was compliant with USC’s admissions policies.
By the time the Fourth Superseding Indictment was filed
on January 14, 2020 (still more than three years before the
Wilsons filed their complaint), the alarm bells should have been
ringing for the Wilsons. The indictment alleged that when USC
sent a thank you letter in response to Mr. Wilson’s $100,000
donation to the USC Trojan Fund, the university did not know
the donation “was made in exchange for facilitating his son’s
fraudulent admission to USC.” As to the balance of Mr. Wilson’s
payments, the Wilsons knew that USC did not send them a thank
you note for Mr. Wilson’s $100,000 payment to Singer’s charitable
foundation and $20,000 payment directly to Singer. These facts
would make a reasonable person suspect USC did not have a
policy of giving students an admission preference in return for
payments delivered to Singer. The testimony of Ms. Chassin in
2021 only provided evidence proving that reasonable suspicion.
17
The Wilsons have not met their burden of pleading specific
facts showing their inability to make an earlier discovery of the
factual basis for their claims despite reasonable diligence.
Although the FAC alleges conclusions regarding the discovery
rule, its factual allegations fall short. Below we note the quoted
conclusions with italics.
The FAC states Mr. Wilson’s indictment “gave the Wilsons
zero notice that anything USC had represented to them about
financial contributions and athlete admissions was false.” It
further alleges, the “government’s indictment of Jovan Vavic and
others also provided no notice to the Wilsons that they had been
defrauded” because “far from disclosing USC’s fraud, this
indictment highlighted why the Wilsons were situated much
differently that other ‘Varsity Blues’ defendants” in that Johnny
was a “legitimate athletic recruit to USC, not a candidate for
admission who was wrongly ‘designated’ as a water polo recruit
through a ‘bribe’ by Singer or otherwise.”
The FAC also alleges: “The Wilsons investigated many of
the facts relating to the Varsity Blues scandal with reasonable,
and indeed extensive, diligence, particularly as they related to
the charges against Mr. Wilson. They retained top-tier criminal
defense counsel, who reviewed voluminous discovery provided by
the government and third parties, including USC. The Wilsons’
inquiries following the March 11, 2019, indictments and the press
surrounding the Varsity Blues scandal did not uncover that USC
had lied about its admissions practices as it related to donor
preferences for non scholarship athletic recruits.” And, “[n]othing
in [USC’s document production], including admissions-related
internal correspondence, indicated that USC’s representations
about donor preferences for athletic recruits were false.”
18
According to the FAC, the indictments “suggested the
charges against Mr. Wilson were materially different than those
brought against Mr. Singer and many of the other parents.”
Specifically, the indictment against Mr. Wilson charged him and
other parents with explicitly agreeing to and/or collaborating
with Mr. Singer for three related schemes: “i) the Fake Athlete
Scheme—creating fake athletic profiles for children, including by
photoshopping pictures of the children onto pictures of high
school athletes to misrepresent the children playing sports they
did not play: ii) the Test Cheating Scheme—cheating on
standardized tests such as the ACT; and iii) the Bribery
Scheme—bribing college coaches and/or athletic administrators.”
But, as the FAC alleges, “Mr. Wilson did not participate in any of
those schemes”; rather “Johnny had strong qualifications as a
collegiate-level water polo applicant, and so, the filing of charges
in 2019” did “not put the Wilsons on notice that USC had lied to
them in connection with soliciting donations for the athletic
department.”
We disregard the FAC’s conclusory allegations that the
2019 indictments and the press gave them no reason to believe
that Vavic or other USC representatives lied to them. We focus
only on the Wilsons’ factual assertions.
Taking their factual allegations as true, as we must, the
Wilsons make three overarching assertions. First, they did not
have evidence that USC committed fraud from the 2019
indictments or their own investigation and only had such proof
when USC’s admissions officer testified at Mr. Wilson’s 2021
trial. As we explained, however, inquiry notice may be triggered
before evidence to prove a claim is obtained. (Cypress
Semiconductor, supra, 163 Cal.App.4th at p. 586.)
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Additionally, we accept as true that, in contrast to other
students involved in the Varsity Blues scandal, Johnny had
“strong qualifications” for admission into USC as a water polo
applicant. We also infer the allegations in the indictment and
supporting FBI affidavit regarding Johnny’s qualifications (i.e.,
Singer and Vavic falsified information about him) were untrue.
These facts, however, do not change our inquiry notice analysis.
Whether or not Johnny had strong qualifications is unrelated to
whether Mr. Wilson’s donation was unlawful and in violation of
USC’s policies and whether the Wilsons should have been
suspicious that USC lied to them about the donation.
Lastly, we accept as true that the Wilsons did not
subjectively believe that USC lied to them—even after Mr.
Wilson, Vavic, and Singer were indicted—because the Wilsons
were convinced Mr. Wilson was innocent and not similarly
situated to the other Varsity Blues defendants who may have
engaged in criminal conduct. Inquiry notice is triggered and the
statute of limitations begins to run, however, if a reasonable
person should have suspected he was lied to regarding the
appropriateness of Mr. Wilson’s donation. (See Fox, supra, 35
Cal.4th at p. 807.)
We conclude that the allegations in the FAC and the
judicially noticeable documents support only one legitimate
inference: by the time of the criminal charges in 2019 and 2020, a
reasonable person would have suspected that USC’s alleged
representations regarding the Wilsons’ donation were false. The
three-year statute of limitations, therefore, began running on the
Wilsons’ claims for fraud and intentional misrepresentation in
2019 or at the latest in 2020, making their complaint filed in
2024 untimely. We need not resolve any factual disputes to come
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to this conclusion. The trial court correctly sustained USC’s
demurrer to the FAC without leave to amend.
DISPOSITION
The judgment is affirmed. Respondent University of
Southern California is awarded its costs on appeal.
NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS
TAMZARIAN, J.
We concur:
ZUKIN, P. J.
FEUER, J.*
* Justice of the Court of Appeal, Second Appellate District,
Division Seven, assigned to Division Four, by the Chief Justice
pursuant to article VI, section 6 of the California Constitution.
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