Judge: Armen Tamzarian, Case: 24STCV18825, Date: 2025-02-13 Tentative Ruling
Case Number: 24STCV18825 Hearing Date: February 13, 2025 Dept: 52
Tentative Ruling:
Cross-Defendant Jaeil Lee’s Motion to
Strike Strategic Lawsuit Against Public Participation
Cross-defendant Jaeil Lee specially moves
to strike numerous portions of the cross-complaint by
defendants/cross-complainants AcuProGroup, Inc., Bongchol Yi, and Minhee Chang.
Summary of Pleadings
Lee’s
complaint alleges defendants committed various Labor Code violations (and
related causes of action) arising from his employment as an acupuncturist at
AcuProGroup.
The cross-complaint against Lee asserts five
causes of action. Cross-complainants
allege Lee was never an employee of AcuProGroup. They instead allege he volunteered to be an
unpaid intern at AcuProGroup. Cross-complainants
further allege Lee was in the United States on a student visa and had no legal
permission to work in this country.
Cross-complainants allege AcuProGroup sponsored Lee’s immigration
application. They also allege that in
2024, “Lee fraudulently secured the passwords for [Minhee Chang’s] computer,
accessed the confidential patient and insurance financial billing platform for
AcuProGroup, Inc. and further accessed the confidential and private patient,
insurance, and financial information of the business operations.” (Cross-Comp., ¶ 18.) The cross-complaint alleges Lee used Chang’s
computer to attempt to “electronically transfer business funds to himself.” (Ibid.)
Discussion
Courts
use a two-step process for resolving anti-SLAPP motions under Code of Civil
Procedure section 425.16: “First, the court decides whether the defendant has
made a threshold showing that the challenged cause of action is one arising
from protected activity.” (Navellier v. Sletten (2002) 29 Cal.4th
82, 88 (Navellier).) The defendant must show “the cause of action
is based on the defendant’s protected free speech or petitioning
activity.” (Id. at p. 89.)
Second,
once the defendant establishes the first element, courts “must then determine
whether the plaintiff has demonstrated a probability of prevailing on the
claim.” (Navellier, 29 Cal.4th at p. 88.)
“[T]he plaintiff need only have stated and substantiated a legally
sufficient claim.” (Ibid., internal quotes and citations omitted.) “[C]laims with the requisite minimal merit
may proceed.” (Id. at p.
94.) “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.’ ” (Wilson v. Parker, Covert & Chidester (2002)
28 Cal.4th 811, 821.)
I. Protected
Activity
Lee meets his
burden of showing that only one of the numerous challenged portions of the
cross-complaint constitutes protected activity that supplies an element of the
cross-complaint’s causes of action. Lee contends
the specified portions of the cross-complaint are protected activity because
they arise from his filing of this lawsuit.
(Motion, p. 4.) Protected
activity includes “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.” (Code Civ. Proc., § 425.16, subd.
(e)(2).) This provision is “construed
broadly, to protect the right of litigants” and applies to a communication “if
it has ‘ “some relation” ’ to judicial proceedings.” (Healy v. Tuscany Hills Landscape &
Recreation Corp. (2006) 137 Cal.App.4th 1, 5.)
Most of
the challenged portions of the cross-complaint do not constitute protected
activity—even without considering whether the cross-complaint seeks to hold Lee
liable for that purportedly protected activity.
Instead, the challenged portions allege conduct that preceded Lee’s
lawsuit and that was not connected to anticipated litigation. For example, the first challenged portion of
the cross-complaint is the allegation that “Lee did not have proper immigration
status or work permit to be gainfully employed in the United States.” (Cross-Comp., ¶ 2.) That constitutes a legal conclusion
independent of Lee’s lawsuit against defendants. The second challenged portion is that “Lee
confirmed that he only had a student visa and asked Yi to support Lee in his
efforts to secure a work permit.” Again,
that preceded this lawsuit and is not petitioning activity. With four exceptions, the same conclusion
applies to all challenged portions of the cross-complaint.
Only the
following portions of the cross-complaint constitute protected activity under
Code of Civil Procedure section 425.16(e):
(1) “If
LEE is alleging that he was an employee despite his specific representations
that he knew, understood and agreed that it was unlawful for him to be employed
and paid wages under this student visa, then LEE knowingly, intentionally,
planned, intended, and specifically strategized to commit felony violations of
immigration laws, including but not limited to violations of 18 U.S. Code §1546.” (Cross-Comp., ¶ 17.)
(2) “Cross Complainants are informed and
believe that LEE is [now] claiming he was an employee, and that he worked 10
hours per day which is impossible since the business operations are only open
for 8 hours and the facilities are otherwise locked and closed.” (¶ 20.)
(3) “[U]pon learning that LEE is now
fraudulently claiming that he committed felony violations of immigration laws
by claiming he was an employee and entitled to wages while under his student
visa…” (¶ 21.)
(4) Lee was “committing fraud … and
falsely claiming that his volunteer internship was … working.” (¶ 27.)
These four portions of the cross-complaint
specifically refer to what Lee is “alleging” or “claiming.” His complaint in this civil action makes
those allegations and claims. These portions
of the cross-complaint therefore constitute protected activity.
The first three portions above, however, do
not supply the elements of the cross-complaint’s causes of action such that
cross-complainants seek to hold Lee liable for protected activity. “ ‘[A] claim is not subject to a motion to strike simply because it
contests an action or decision that was arrived at following speech or
petitioning activity, or that was thereafter communicated by means of speech or
petitioning activity. Rather, a claim
may be struck only if the speech or petitioning activity itself is the
wrong complained of, and not just evidence of liability or a step leading to
some different act for which liability is asserted.’ [Citation.]
Thus, in evaluating an anti-SLAPP motion, ‘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.’ ” (Golden Gate Land Holdings LLC v. Direct
Action Everywhere (2022) 81 Cal.App.5th 82, 90.) “Courts must be careful to distinguish
allegations of conduct on which liability is based from allegations of motives
for such conduct. The court reviews the
parties’ pleadings, declarations, and other supporting documents to determine what
conduct is actually being challenged, not to determine whether the conduct is
actionable.” (San Diegans for Open
Government v. San Diego State University Research Foundation (2017) 13
Cal.App.5th 76, 94.)
Lee’s
papers do not identify the elements of the cross-complaint’s causes of action
or analyze how the challenged allegations supply those elements. The first three of the four portions
discussed above do not supply the elements of any claims. Instead, those allegations explain why cross-complainants
now believe Lee’s prior representations and conduct were false or
fraudulent. The elements of the claims
for fraud, breach of contract, and the other causes of action are supplied by
the allegations that Lee falsely told cross-complainants that he would work as
an unpaid intern on a student visa and would not be an employee. Then, when Lee filed his complaint to allege
or claim he was actually an employee entitled to wages, that demonstrated his
prior conduct—which was not related to his free speech or petitioning
activity—was fraudulent.
The
allegations that follow portion (3) above illustrate this: “[U]pon learning
that Lee is now fraudulently claiming that he committed felony violations of immigration
laws by claiming he was an employee and entitled to wages while under his
student visa, AcuProGroup, Inc. instructed [immigration attorney Kisuk] Paek to
immediately withdraw, cease, and close AcuProGroup, Inc.’s sponsorship of Lee’s
immigration application. Cross Complainants allege that all representations
that Lee submitted in his immigration application were false and false were
made.” (Cross-Comp., ¶ 21, italics
added.) The allegedly fraudulent conduct
for which cross-complainants seek to hold Lee liable was not that Lee made
false statements in his complaint in July 2024.
The alleged fraud is that he made false representations in his
immigration application before he filed the lawsuit. Then cross-complainants learned those prior
representations were false when plaintiff filed a civil action contradicting his
prior representations.
Some of the
fourth portion specified above constituted protected activity that purports to
supply the element of breach for the second cause of action for breach of
contract. The cross-complaint alleges,
“[A]n oral contract existed between YI, ACCUPROGROUP, INC. on the one hand and LEE on the other hand, wherein
LEE was a volunteer, unpaid intern, who was not an employee, and who would be
onsite at random times to learn, educate and acquire skills which would solely
benefit LEE.” (¶ 26.) “In or about July of 2024, LEE breached said
agreement by among other things violating patient rights, committing fraud
as outlined in the FIRST CAUSE OF ACTION, and falsely claiming that his
volunteer internship was a criminal enterprise of working without a
work permit which means that LEE’s immigration application knowingly contained
fraudulent and false information.” (¶
27, challenged portion in italics.)
“[C]ommitting
fraud as outlined in the first cause of action” does not constitute a protected
activity because, as discussed above, the alleged fraud is not that Lee makes
false claims in his complaint. As to “falsely
claiming that his volunteer internship was … working”, the cross-complaint alleges
that false claim itself breached the parties’ oral contract. Lee meets his burden of showing that portion
of the cross-complaint constitutes protected activity that supplies an element
of the cause of action for breach of oral contract.
II.
Probability of Prevailing
As to the lone allegation that
proceeds to prong two of the anti-SLAPP analysis, cross-complainants show no
probability of prevailing on the merits.
The alleged contract is that Lee “was a volunteer, unpaid intern, who
was not an employee, and who would be onsite at random times to learn, educate
and acquire skills which would solely benefit Lee.” (Cross-Comp., ¶ 26.) The protected activity that purportedly
constituted breach was “falsely claiming that his volunteer internship was a
criminal enterprise of working without a work permit.” (¶ 27.)
That could not breach the contract alleged because the contract does not
prohibit Lee from doing that. The
contract’s terms were that Lee would serve as an unpaid intern. Allegedly lying about the contract’s terms
afterward does not breach any term of the contract.
Attorney
Fees
In his
moving papers, Lee seeks attorney fees incurred for this motion. A party who prevails on an anti-SLAPP motion
is entitled to recover attorney fees.
(Code Civ. Proc., § 425.16, subd. (c)(1).) But a defendant who achieves an “illusory
victory” with no practical result is not a prevailing party and cannot recover attorney
fees. (Moran v. Endres (2006)
135 Cal.App.4th 952, 955.)
Lee’s
anti-SLAPP motion challenged 16 portions of the cross-complaint. He succeeded only in striking part of item 15
specified in his notice of motion: “Paragraph 27 (partial), Page 9, part of
Line 5, part of Line 6 (‘. . . committing fraud . . . falsely claiming that his
volunteer internship was . . . working.’)”
(Motion, p. iv.) Of that item,
Lee successfully struck only the final eight words. This victory is illusory. He did not defeat any entire cause of
action. He defeated only a minimal portion
of the second cause of action for breach of oral contract.
First
Amended Cross-Complaint
After Lee filed this motion and
after cross-complainants filed their opposition, cross-complainants filed a
first amended cross-complaint. A
plaintiff or cross-complainant generally “may not seek to subvert or avoid a
ruling on an anti-SLAPP motion by amending the challenged complaint ... in
response to the motion.” (JKC3H8 v. Colton (2013) 221 Cal.App.4th
468, 477-478.) Cross-complainants did
not seek to subvert or avoid the ruling on this anti-SLAPP motion by filing an
amended complaint. They opposed the
motion before filing the first amended cross-complaint. Their opposition did not refer to any
proposed future amendments. The
circumstances indicate the first amended cross-complaint was filed in response
to Lee’s demurrer, not this anti-SLAPP motion.
In its
discretion, the court may strike the first amended cross-complaint in its
entirety, then rule on this motion as if there were no first amended
cross-complaint. But doing so would be
inefficient. Instead, striking the
portion of the first amended cross-complaint that corresponds to the subject
portion of the initial cross-complaint will fully serve the policy behind the
anti-SLAPP statute.
If there
were no first-amended cross-complaint, the court would strike the italicized
text in the following portion of the cross-complaint: “falsely claiming that his volunteer internship
was a criminal enterprise of working
without a work permit.” (Cross-Comp., ¶
27, page 9, lines 6 to 7.) The first
amended cross-complaint includes the same text: “falsely claiming to
outside parties that his volunteer internship was a criminal enterprise
of working without a work permit.”
(FACC, ¶ 27, page 12, lines 20 to 21.)
The court will therefore strike that portion of the first amended
cross-complaint.
Disposition
Cross-defendant Jaeil Lee’s special motion
to strike portions of the cross-complaint is granted in part. The court hereby strikes the following
portion of the first amended cross-complaint without leave to amend: “falsely claiming … that his volunteer
internship was … working.” (First
Amended Cross-Comp., ¶ 27, page 12, lines 20 to 21.)