Judge: Anne Richardson, Case: 24STCV17331, Date: 2024-10-07 Tentative Ruling

Case Number: 24STCV17331    Hearing Date: October 7, 2024    Dept: 40

Superior Court of California

County of Los Angeles

Department 40

I. Background

A. Pleadings

Plaintiff Joshua Lorne Rogers (Rogers) sues Defendants Carlson Industries, LLC, Natasha Teresa Skidmore (Skidmore), Nicholas Kanter (Kanter), and Does 1 through 100 (collectively, Defendants) pursuant to a July 12, 2024 Complaint alleging causes of action for: (1) Breach of Contract, as to Skidmore; (2) Breach of Contract, as to Carlson Industries; (3) Inducing Breach of Contract, as to Carlson Industries and Kanter; (4) Intentional Interference with Contractual Relations, as to Carlson Industries and Kanter; (5) Breach of Covenant of Good Faith, as to Carlson Industries; and (6) Breach of Covenant of Quiet Enjoyment, as to Carlson Industries.

Defendant Carlson Industries owns the real properties located at 2100 N. Main Street, Los Angeles, CA 90031 (2100 Property) and 660 South Avenue 21, Los Angeles, CA 90031 (660 Property). On March 6, 2021, Carlson Industries and Rogers entered into a lease agreement for Unit #B-5 at the 2100 Property. On December 28, 2021, Carlson Industries and Rogers entered into a lease agreement for Unit # 5 at the 660 Property. On September 13, 2023, Rogers and Skidmore entered into a sublease agreement in which Skidmore was to sublease Rogers’ unit at the 660 Property from October 15, 2023, to October 14, 2024.

Rogers alleges that Skidmore made one payment of $8,400 under the Sublease and made no payments thereafter. He alleges that Carlson Industries and Kanter caused Skidmore to discontinue payments under the sublease. He further alleges that Carlson Industries denied Rogers’ request to sublease and barred Rogers from hosting an event at the 660 Property, in violation of the lease and the covenant of good faith and fear dealing, and breached the covenant of quiet enjoyment by hosting twice yearly “Artwalks” at the 660 Property.

On January 11, 2024, acting as attorney for Carlson Industries, Kanter sent Rogers and Skidmore a proposed Settlement Agreement. The proposed Settlement Agreement included leasing the unit in the 660 Property directly to Skidmore and dismissing the ongoing unlawful detainer lawsuit against Rogers, in exchange for Rogers terminating his lease and vacating the property.

This action was filed on July 12, 2024.

B. Motion Before the Court

On September 10, 2024, Kanter filed a special motion to strike (anti-SLAPP motion) against the Complaint’s third and fourth causes of action, on the grounds that those claims and allegations arise from protected activity related to settlement communications and that Rogers cannot show a probability of prevailing on those causes of action.  

On September 30, 2024, Rogers opposed the anti-SLAPP motion. 

On October 1, 2024, Kanter replied to the opposition. 

Kanter’s anti-SLAPP motion is now before the Court.

II. Anti-SLAPP Motion

A. Request for Judicial Notice

Pursuant to Evidence Code section 452, subdivision (d), the Court may take judicial notice of “[r]ecords of (1) any court of this state or (2) any court of record of the United States or of any state of the United States”. The court however may not take judicial notice of the truth of the contents of the documents. (Herrera v. Deutsche Bank National Trust Co. (2011) 196 Cal.App.4th 1366, 1375.) Documents are only judicially noticeable to show their existence and what orders were made such that the truth of the facts and findings within the documents are not judicially noticeable. (Lockley v. Law Office of Cantrell, Green, Pekich, Cruz & McCort (2001) 91 Cal.App.4th 875, 885.) 

Per Kanter’s request, the Court takes judicial notice of the Complaint for Unlawful Detainer Carlson Industries, LLC filed against Joshua Lorne Rogers on October 18, 2023, in the Los Angeles Superior Court, Case No. 23STUD13600.

B. Evidentiary Objections

Kanter’s Objections to the Declaration of Joshua Lorne Rogers:  

SUSTAINED: No. 1 [lacks foundation]

OVERRULED: No. 4

The remaining objections were not ruled on as they are not dispositive of the Court’s determination.

C. Timeliness

Oppositions to a motion must be made nine court days prior to the hearing plus however many extra days are provided for the method of service at issue. (Code Civ. Proc., §§ 1005, subd. (b) [nine court days], 1013, subd. (a) [five extra days to act in respond to mailed paper].) 

Nine court days before this hearing, accounting for Native American Day, was Monday September 23, 2024. The opposition was filed September 30, 2024, i.e., five court days prior to the hearing. The opposition is therefore untimely. 

However, the Court will exercise its discretion and hear the motion on the merits.

D. Legal Standard

Anti-SLAPP analysis under Code of Civil Procedure section 425.16 proceeds in two familiar steps. In the first step, the defendant or moving party must make “a threshold showing that the challenged cause of action is one ‘arising from’ protected activity.” (Barry v. State Bar of California (2017) 2 Cal.5th 318, 321, quotations omitted (Barry).) In this context, the term “protected activity” refers to speech or petitioning activities. (Barry, 2 Cal.5th at p. 321.) A claim arises from protected activity when that activity underlies or forms the basis for the claim; otherwise stated, “the defendant’s act underlying the plaintiff’s cause of action [must] itself [be] … an act in furtherance of the right of petition or free speech.” (Park v. Board of Trustees of California State University (2017) 2 Cal.5th 1057, 1063, quotations omitted (Park).) “[T]he focus is on determining what ‘the defendant’s activity [is] that gives rise to his or her asserted liability—and whether that activity constitutes protected speech or petitioning.’” (Ibid.) In teasing out whether protected conduct exists, courts should consider the elements of the challenged claim and what actions by the defendant supply those elements and consequently form the basis for liability. (Ibid.) 

If the court finds the defendant or moving party succeeds at the first step, then the burden shifts to the plaintiff to “demonstrate[] a probability of prevailing on the claim.” (Ibid. [quotations omitted].) At the second step, courts “evaluate the defendants’ evidence only to determine if it defeats that submitted by the plaintiff as a matter of law.’ [Citation.] ‘[I]n order to establish the requisite probability of prevailing [citation], the plaintiff need only have “‘stated and substantiated a legally sufficient claim.’” [Citation.] “Put another way, the plaintiff ‘must demonstrate that the complaint is both legally sufficient and supported by a sufficient prima facie showing of facts to sustain a favorable judgment if the evidence submitted by the plaintiff is credited.’”‘ [Citation.] … That burden [is] not particularly high.” (Area 51 Productions, Inc. v. City of Alameda (2018) 20 Cal.App.5th 581, 602 (Area 51 Productions, Inc.).) “Claims with the requisite minimal merit may proceed.” (Navellier v. Sletten (2002) 29 Cal.4th 82, 94 (Navallier).) If the cause of action satisfies both prongs of the anti-SLAPP statute, then it is subject to being struck. (Barry, supra, 2 Cal.5th at p. 321.) 

As stated by our State’s highest Court: “This is a ‘summary-judgment-like procedure at an early stage of the litigation.’” (Varian Medical Systems, Inc. v. Delfino (2005) 35 Cal.4th 180, 192 (Varian).) 

1. First-Prong Analysis 

A defendant meets his burden of showing that a plaintiff’s claim arises from that defendant’s exercise of free speech or petition rights by making a prima facie showing that the act or conduct underlying the plaintiff’s claims falls within one of the four categories found in Code of Civil Procedure Section 425.16, subdivision (e). (Navellier, supra, 29 Cal.4th at p. 88.) “Courts should analyze each claim for relief — each act or set of acts supplying a basis for relief, of which there may be several in a single pleaded cause of action — to determine whether the acts are protected [the first prong of the analysis] and, if so, whether the claim they give rise to has the requisite degree of merit to survive the motion [the second prong of the analysis].” (Bonni v. St. Joseph Health System (2021) 11 Cal.5th 995, 1010.) “[W]hen the allegations referring to an arguably protected activity are only incidental to a cause of action based essentially on non-protective activity, collateral allusions to protected activity should not subject the cause of action to the anti-SLAPP statute.” (Martinez v. Metabolife Internat., Inc. (2003) 113 Cal.App.4th 181, 188 (Martinez).) 

Code of Civil Procedure Section 425.16, subdivision (e) states: 

As used in this section, “act in furtherance of a person’s right of petition or free speech under the United States or California Constitution in connection with a public issue” includes:  

(1) any written or oral statement or writing made before a legislative, executive, or judicial proceeding, or any other official proceeding authorized by law,  

(2) any written or oral statement or writing made in connection with an issue under consideration or review by a legislative, executive, or judicial body, or any other official proceeding authorized by law,  

(3) any written or oral statement or writing made in a place open to the public or a public forum in connection with an issue of public interest, or  

(4) any other conduct in furtherance of the exercise of the constitutional right of petition or the constitutional right of free speech in connection with a public issue or an issue of public interest.  

(Code Civ. Proc., § 425.16, subd. (e).)

Allegations of protected conduct that are ‘merely incidental’ to the unprotected conduct on which liability is based does not constitute protected conduct for anti-SLAPP purposes. (Martinez v. Metabolife Internat., Inc. (2003) 113 Cal.App.4th 181, 188 [“[W]hen the allegations referring to arguably protected activity are only incidental to a cause of action based essentially on nonprotected activity, collateral allusions to protected activity should not subject the cause of action to the anti-SLAPP statute”]; see Peregrine Funding Inc. v. Sheppard Mullin Richter & Hampton LLP (2005) 133 Cal.App.4th 658, 672 [same in mixed cause of action context]; see, e.g., Moriarty v. Laramar Management Corp. (2014) 224 Cal.App.4th 125, 133-135, 139 [holding causes of action did not arise from alleged eviction, despite their incorporation of all prior allegations by reference].) 

At the first step of the anti-SLAPP analysis, the moving defendant bears the burden of identifying all allegations of protected activity, and the claims for relief supported by them. When relief is sought based on allegations of both protected and unprotected activity, the unprotected activity is disregarded for the first prong of the anti-SLAPP discussion. If the court determines that relief is sought based on allegations arising from activity protected by the statute, the second step is reached. (Baral v. Schnitt (2016) 1 Cal.5th 376, 396 (Baral).) 

In the motion, Kanter argues that the Complaint’s third cause of action for Inducing Breach of Contract and fourth cause of action for Intentional Interference with Contractual Relations arise from settlement related activities, which have consistently been held to constitute protected activity under the anti-SLAPP statute (Mot. pp. 2, 6-7.)

In opposition, Rogers argues that the challenged causes of action do not arise from protected activity because the conduct complained of is Kanter’s interference with Rogers’ sublease agreement with Skidmore, which is not a matter “under consideration by the court.” (Opp. p. 1.) Rogers argues that Carlson Industries and Kanter offered Skidmore a direct lease in place of her sublease with Rogers. (Opp. p. 5.)  He asserts that although titled Settlement Agreement, the document was merely a lease proposal which he argues impermissibly circumvented his sublease agreement with Skidmore. (Opp. p. 5:26-6:3.) Rogers further argues that the Settlement Agreement document was not part of a protected settlement negotiation for anti-SLAPP purposes in this action, because Skidmore was not a party to the underlying unlawful detainer case between Carlson Industries and Rogers (Opp. p. 5:13-25.)

Rogers also addresses the gravamen test, and argues that “even if the claims were found to allege a mixture of protected and unprotected activity, they should not be stricken because the protected activity is merely incidental to the unprotected activity.” (Opp. p. 9:7-10.) In so doing, he cites to outdated authorities that predate the Supreme Court’s most recent articulation of the relevant anti-SLAPP test, Baral v. Schnitt (2016) 1 Cal.5th 376 and Bonni v. St. Joseph Health System (2021) 11 Cal.5th 995. Moreover, although Rogers does not specify what activity he refers to as unprotected activity, presumably he refers to his general allegation that Kanter had additional communications with Skidmore, beyond the “Settlement Agreement,” some in his capacity as an attorney in the underlying Unlawful Detainer case, and some in a personal capacity. (Opp. pp. 4-5.) 

Here, the Court finds that the third and fourth causes of action arise from protected activity. Carlson Industries filed the underlying unlawful detainer action against Rogers on October 18, 2023. (RJN, Ex. A.) In an effort to resolve that litigation, Kanter sent the proposed Settlement Agreement to Rogers and Skidmore on January 11, 2024. (Mot. p. 4:23; Compl., Ex. 4.) Kanter’s communications related to the proposed Settlement Agreement are protected under the anti-SLAPP statute because the litigation privilege extends to statements made in connection with pending litigation. This perspective aligns with the idea that the litigation privilege covers conduct associated with litigation, including settlement negotiations and mediation, which are seen as exercises of the First Amendment right to petition.  (O&C Creditors Grp., LLC v. Stephens and Stephens XII, LLC (2019) 42 Cal.App.5th 546; Navellier, supra, 29 Cal.4th 82 at 85-86). Settlement negotiations, regardless of when they occur, are protected activities because they involve communications pending before or under consideration by an official body.  (Navellier, supra, 29 Cal.4th at 90.)

Rogers' argument that the third and fourth causes of action are not protected communications—because the proposed Settlement Agreement “exceeded the scope of settlement negotiations” by involving a third party, Skidmore, who was not party to the unlawful detainer action, and because it “sought to resolve matters entirely outside the scope” of the case—is unpersuasive. Skidmore, as sublessee to Rogers’ lease agreement, is bound by the conditions of Rogers’ lease. (Compl., Ex. 3, Sublease Agreement ¶ 8.) Further, the sublease expressly provides that “Sublessee agrees that if the Master Lease is terminated for any reason, this Sublease Agreement will terminate effective the same date.” (Compl., Ex. 3, Sublease Agreement ¶ 10.) Thus, unavoidably, the underlying unlawful detainer action directly affects Skidmore, and she is necessarily a party to the Settlement Agreement. Thus, Rogers’ arguments do not support a conclusion that the claims do not arise from protected settlement communications.

Further, the Complaint alleges that the Settlement Agreement underlies the causes of action for Inducing Breach of Contract and Intentional Interference with Contractual Relations. Rogers states that “Ms. Skidmore chose to breach her sublease agreement with me based primarily on her understanding, based on the proposal (“Settlement Agreement”) she received from Mr. Kanter and additional direct communication with Mr. Kanter that she was “in the right” to discontinue paying me and wait to sign a direct lease for the same property.” (Rogers Decl. ¶ 6.) Thus, as Skidmore’s decision to breach the lease was “based primarily on her understanding, based on the proposal (“Settlement Agreement”), the protected activities underlie the causes of action. (Rogers Decl. ¶ 6.) No other specific conduct underlying these claims is alleged in the Complaint.

Thus, Kanter has satisfied his burden to show that the allegations supporting the third and fourth causes of action fall within the definition of protected activity for the purposes of satisfying the first prong of the anti-SLAPP analysis.

2. Second-Prong Analysis 

If the first prong of the anti-SLAPP analysis is met, “the burden shifts to the plaintiff [i.e., Ms. Weiss] to demonstrate[] a probability of prevailing on the claim[s].” (Park, supra, 2 Cal.5th at p. 1063 [quotations omitted].) “Claims with the requisite minimal merit may proceed.” (Navellier, supra, 29 Cal.4th at p. 94.) The plaintiff “must demonstrate that the complaint is both legally sufficient and supported by a sufficient prima facie showing of facts to sustain a favorable judgment if the evidence submitted by the plaintiff is credited.” (Area 51 Productions, Inc., supra, 20 Cal.App.5th at p. 602 [quotations omitted].) 

As discussed above, the litigation privilege applies to statements made in connection with pending litigation. As Kanter explains, “The litigation privilege applies to settlement communications at issue in this case because: (1) they were made during the pendency of the UD Lawsuit; (2) by litigants/participants authorized by law (i.e., Kanter, in his capacity as attorney for Carlson); (3) to attempt to resolve the UD Lawsuit; and (4) the settlement communications were directly connected to the UD Lawsuit. (Complaint, ¶ 10, Ex. 4; Kanter Decl. ¶ 4)” (Mot. p. 8:23:27.)

Rogers argues that the litigation privilege should not apply because Kanter sent the Settlement Agreement not to achieve the objects of the litigation, but rather to apply financial pressure on Rogers. (Opp. p. 11.) However, “[t]he litigation privilege protects even communication made with an intent to harm, so long as the communication is made in ‘relation’ to a pending/ongoing or genuinely contemplated judicial or other official proceeding.”  (Geragos v. Abelyan (2023) 88 Cal.App.5th 1005, 1031-1032.) Accordingly, Rogers has not met his burden to state and substantiate a legally sufficient claim.  

Because the Settlement Agreement, and the communications and activities pursuant to it, are privileged, Rogers has not shown a probability of success on the merits of the third and fourth causes of action.

III. Conclusion

Defendant Nicholas Kanter’s Special Motion to Strike is GRANTED.

The third and fourth causes of action are stricken.