Judge: Joseph Lipner, Case: 24STCV25899, Date: 2025-01-16 Tentative Ruling
Case Number: 24STCV25899 Hearing Date: January 16, 2025 Dept: 72
SUPERIOR COURT OF CALIFORNIA
COUNTY OF LOS ANGELES
DEPARTMENT 72
TENTATIVE
RULING
|
MCNICHOLAS & MCNICHOLAS, LLP, Plaintiff, v. NAIR PC, et al., Defendants. |
Case No:
24STCV25899 Hearing Date: January 16, 2025 Calendar Number: 9 |
Defendant Abel Nair (“Defendant”) moves to strike the First
Amended Complaint (“FAC”) filed by Plaintiff McNichols & McNicholas, LLP
(“Plaintiff”) pursuant to Code of Civil Procedure, section 425.16.
Plaintiff moves to lift the automatic discovery stay imposed
by the filing of the anti-SLAPP motion in order to conduct limited discovery.
The Court DENIES the anti-SLAPP motion.
The Court DENIES the motion to lift the discovery stay as
MOOT.
This is a dispute between attorneys over clients.
Defendant, a practicing attorney for over 20 years, was
employed by Plaintiff, a law firm, from May 2015, to August 31, 2022. In August
2022, Defendant gave notice that he would be departing for Wilshire Law Group
starting on September 1, 2022. Defendant was never an officer, director, or
partner of Plaintiff. The gravamen of Plaintiff’s claims in the FAC is that
Defendant wrongfully usurped two potential clients, Jason Armendariz
(“Armendariz”) and Heather Rolland (“Rolland”), in two separate matters.
In June 2020, Armendariz contacted Plaintiff regarding
potential claims related to disability discrimination by the Los Angeles Police
Department (“LAPD”). (McNicholas Decl. ¶ 14.) Armendariz interacted with
employees of Plaintiff several times in June, July, and August 2020.
(McNicholas Decl. ¶¶ 14-15.) On August 11, 2022, Armendariz called Defendant
for the purpose of consulting with Defendant regarding possible legal
representation of Armendariz against LAPD. (Nair Decl. ¶ 8.)
Plaintiff alleges that Armendariz met with Defendant on
August 19, 2022 at Defendant’s request, at which meeting Defendant told
Armendariz that Plaintiff was too busy to handle Armendariz’s case and
presented Armendariz with an engagement agreement that Defendant asked him to
sign. (FAC ¶ 17.) Armendariz did not ultimately retain Plaintiff, but instead
retained Defendant to pursue his case.
Heather Rolland, the other client, provides a declaration
stating that Defendant deceived her into retaining him and the Wilshire Law
Group instead of Plaintiff. (Rolland Decl. ¶ 17-24.) Rolland declares that she
reached out to Plaintiff on June 12, 2018 and July 16, 2020 regarding potential
claims against LAPD. (Rolland Decl. ¶¶ 5-7.) On July 16, 2020, Rolland spoke on
the phone with Matthew and provided information about her potential claims,
which included workplace retaliation. (Rolland Decl. ¶ 9.) On Matthew’s advice,
Rolland waited to pursue her claims to see if further retaliation occurred.
(Rolland Decl. ¶ 9.)
Rolland first communicated with Defendant on February 2,
2021 through his law firm email address with Plaintiff. (Rolland Decl. ¶ 11.)
Rolland met Defendant in person on February 14, 2022 to be interviewed by him
as a witness for a different case that Plaintiff was handling. (Rolland Decl. ¶
13.) During the interview, Rolland and Defendant discussed Rolland’s own
potential claims, with Rolland believing that Defendant was speaking as an
attorney with Plaintiff. (Rolland Decl. ¶¶ 14-16.)
On July 12, 2022, Rolland called Defendant to tell him that
she was ready to proceed with her claims against LAPD, still believing that
Defendant was acting in his capacity as an attorney with Plaintiff. (Rolland
Decl. ¶¶ 17-18.) That day, Defendant sent her a document entitled “Referral
Agreement”, which Rolland signed, believing that she was signing up as a client
of Plaintiff. (Rolland Decl. ¶ 19.) Defendant did not explain to Rolland that
the purpose of the Referral Agreement was for Defendant to take Rolland’s case
with him when he left Plaintiff. (Rolland Decl. ¶ 20.)
Defendant never told Rolland that he left his employment
with Plaintiff. (Rolland Decl. ¶ 20.) Shortly after Defendant left his
employment with Plaintiff, Defendant sent Rolland an agreement with the
Wilshire Law Group. (Rolland Decl. ¶ 21.) told her that she needed to sign it
so that he could keep representing her and that her case would stall if she did
not sign it. (Rolland Decl. ¶ 21.) Rolland signed the agreement, but still did
not understand that Defendant was no longer an attorney with Plaintiff. (Rolland
Decl. ¶ 22.)
Rolland declares that it was always her intention to retain
Plaintiff to represent her and she believed that that was what she was
accomplishing by communicating with Defendant and signing the Referral
Agreement. (Rolland Decl. ¶ 24.)
Plaintiff filed this action on October 4, 2024 against both
Defendant and Nair PC. Nair PC is no longer a named defendant. The operative
complaint is now the FAC, which raises claims for (1) breach of duty of
loyalty; (2) intentional interference with prospective economic advantage; and
(3) negligent interference with prospective economic advantage.
On December 10, 2024, Defendant filed this anti-SLAPP motion. Plaintiff filed an
opposition and Defendant filed a reply.
On December 17, 2024, Plaintiff filed the motion to lift the
automatic discovery stay imposed by the filing of the anti-SLAPP motion.
Defendant filed an opposition and Plaintiff filed a reply.
The Court sustains Defendant’s objection No. 31. Although
Defendant does not raise the hearsay objection, the statement is nevertheless
hearsay, and the Court raises the objection sua sponte.
The Court overrules the parties’ remaining evidentiary
objections.
The Court grants Defendant’s request for judicial notice and
takes notice of the requested public records from the Rolland case and the
Armendariz case.
Code of Civil Procedure, section 425.16 requires courts to
strike causes of action arising from an act in furtherance of the defendant’s
right of free speech or petition unless the plaintiff establishes that there is
a probability that the plaintiff will prevail on the claim.
In assessing a defendant’s Code of Civil Procedure, section
425.16 special motion to strike, the court must engage in a two-step process. (Shekhter
v. Financial Indem. Co. (2001) 89 Cal.App.4th 141, 150.) First, the court
must decide whether the defendant has met the threshold burden of showing that
the plaintiff’s cause of action arises from the defendant’s constitutional
rights of free speech or petition for redress of grievances. (Ibid.)
This burden may be met by showing the act which forms the basis for the
plaintiff’s cause of action was an act that falls within one of the four
categories of conduct set forth in Code of Civil Procedure section 425.16,
subdivision (e).
Once a defendant has met its initial burden and established
that the anti-SLAPP statute applies, the burden shifts to the plaintiff to
demonstrate a “probability” of success on the merits. (Code Civ. Proc., §
425.16, subd. (b); Equilon Enters. LLC v. Consumer Cause, Inc. (2002) 29
Cal.4th 53, 67.) “[T]he 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.” (Matson v. Dvorak (1995) 40 Cal.App.4th 539, 548, internal
quotations omitted.)
To determine the gravamen of an alleged SLAPP, courts look
to the factual basis for liability. (Wallace v. McCubbin (2011) 196
Cal.App.4th 1169, 1190, as modified on denial of reh'g (July 26, 2011)
disapproved of on other grounds by Baral v. Schnitt (2016) 1 Cal.5th
376.)
The
anti-SLAPP statute applies to a “cause of action against a person arising from
any act of that person in furtherance of the person’s right of petition or free
speech under the United States Constitution or the California Constitution in
connection with a public issue.” (Civ.
Proc. Code § 425.16, subd. (b)(1).) The statute defines such acts to include
the following:
(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).)
The Anti-SLAPP statute protects statements and writings made
before a legislative, executive, or judicial proceeding. (Code Civ. Proc., §
425.16, subd. (e)(1).) “The constitutional right to petition ... includes the
basic act of filing litigation....” (Birkner v. Lam (2007) 156
Cal.App.4th 275, 281.) “It is beyond question that the initiation and
prosecution of [... a lawsuit is] protected under the anti-SLAPP statute.” (Paiva
v. Nichols (2008) 168 Cal.App.4th 1007, 1017-1018).
“A cause of action arising from defendant's litigation
activity may appropriately be the subject of a section 425.16 special motion to
strike. Any act includes communicative conduct such as the filing, funding, and
prosecution of a civil action.” (Thayer v. Kabateck Brown Kellner LLP
(2012) 207 Cal.App.4th 141, 154 [internal citations and quotation marks
omitted; cleaned up].) All communicative acts performed by attorneys as part of
their representation of a client in a judicial proceeding or other petitioning
context are per se protected as petitioning activity by the anti-SLAPP statute.
(Cabral v. Martins (2009) 177 Cal.App.4th 471; Rusheen v. Cohen
(2006) 37 Cal.4th 1048, 1056.) Further, “communications preparatory to or in
anticipation of the bringing of an action or other official proceeding … are
equally entitled to the benefits of section 425.16.” (Briggs v. Eden Council
for Hope & Opportunity (1999) 19 Cal.4th 1106, 1115.) California courts
have held that pre-litigation communications such as letters threatening to sue
are protected activity. (Neville v. Chudacoff (2008) 160 Cal.App.4th
1255, 1266 [letter to employer's customers accusing ex-employee of
misappropriation of trade secrets and threatening to file litigation was
protected]; CKE Restaurants, Inc. v. Moore (2008) 159 Cal.App.4th 262,
271 [statements made in 60–day notice of intent to sue required by Prop. 65].)
“Counseling others in anticipation of litigation or encouraging others to sue
is considered protected prelitigation activity.” (Pech v. Doniger (2022)
75 Cal.App.5th 443, 462.)
“[A] statement is ‘in connection with’ litigation under
section 425.16, subdivision (e)(2) if it relates to the substantive issues in
the litigation and is directed to persons having some interest in the
litigation.” (Neville v. Chudacoff, supra, 160 Cal.App.4th at p.
1266; see also Fremont Reorganizing Corp. v. Faigin (2011) 198
Cal.App.4th 1153, 1167 [statements made by the defendant, who was a
court-appointed liquidator in an insolvency proceeding, to the Insurance
Commissioner concerning the assets of the insolvent company were protected].)
The audience to the statements need not be a party to the proceeding, or even a
potential party, but the audience must have some level of specific interest in
the litigation. (Contemporary Services Corp. v. Staff Pro Inc. (2007)
152 CA4th 1043, 1055 [email to customers accusing competitor of
litigation-related misconduct was protected].)
Plaintiff contends that the gravamen of its claims regards
Defendant’s formation of an attorney-client relationship with Armendariz and
Rolland, rather than the filing of a lawsuit. Plaintiff contends that it is
Defendant’s acts of soliciting and contracting with the clients that is the
basis for Plaintiff’s claims.
In Taheri
Law Group v. Evans (2008) 160 Cal.App.4th 482, 486, the defendant allegedly
induced the plaintiff’s client to terminate their attorney-client relationship
by promising “unobtainable and ethically improper litigation objectives....” (Taheri
Law Group v. Evans (2008) 160 Cal.App.4th 482, 485–486.) The defendant
allegedly promised that he “would be able to enforce a settlement agreement to
which [the client] was a party; [the defendant] ‘without a care moved to
enforce the settlement agreement, leaving the Plaintiffs [adverse parties in
the settled actions] exposed to further malicious prosecution action.’ ” (Id.
at p. 486.) The defendant allegedly advised the client to refuse to pay for
legal services already rendered. (Ibid.)
The
plaintiff argued that “its lawsuit arose from [the defendant’s] conduct
soliciting a client, ‘not what [the defendant] did when he got into the case.’
” (Id. at p. 489.) The court disagreed, finding that “[th]e complaint
plainly shows it arose from [the defendant’s] communications with [the client]
about pending litigation, and from [the defendant’s] conduct in enforcing the
settlement agreement on [the client’s] behalf. (Ibid.) “And, as for the
litigation privilege, numerous cases have applied it to prelitigation
communications [citation], and the litigation privilege clearly ‘informs
interpretation of the “arising from” prong of the anti-SLAPP statute....’
[Citations.]” (Ibid.) Clauses of the anti-SLAPP statute defining
protected activity to include statements made before or in connection with an
issue under review by a judicial body “are parallel to and coextensive with the
definition of privileged communications under Civil Code section 47,
subdivision (b).” (Ruiz v. Harbor View Community Assn. (2005) 134
Cal.App.4th 1456, 1474, as modified on denial of reh'g (Jan. 11, 2006), as
modified (Jan. 13, 2006); Taheri at p. 489.)
There
are differences between this case and Taheri. First, the alleged
solicitation was in connection with potential, and not ongoing, litigation.
However, pre-litigation is also protected. (Pech v. Doniger,
supra, 75 Cal.App.5th at p. 462.)
Second, and more importantly, Defendant’s wrongful conduct
here did not consist of legal advice. In Taheri, the plaintiff alleged
that the defendant poached its client by promising improper and unobtainable
litigation objectives. Here, Plaintiff alleges that Defendant poached its
potential clients by deceiving them as to who they were signing with. Importantly, it is the
method of solicitation from which Plaintiff’s claims flow. “Under the privilege
of free competition, a competitor is free to divert business to himself as long
as he uses fair and reasonable means.” (Tri-Growth Centre City, Ltd. v.
Silldorf, Burdman, Duignan & Eisenberg (1989) 216 Cal.App.3d 1139, 1153.)
“[T]he competition privilege is defeated only where the defendant engages in
unlawful or illegitimate means.” (San Francisco Design Center Associates v.
Portman Companies (1995) 41 Cal.App.4th 29, 42.) In other words, while the
formation of an attorney-client relationship is necessarily a part of
Plaintiff’s claims, it is the wrongful conduct in procuring that relationship
that makes the claims cognizable. Defendant’s alleged deception of Armendariz
and Rolland is the gravamen of Plaintiff’s claims.
Third, unlike in Taheri, Defendant allegedly poached
potential clients from his own firm. Because an employee at a law firm
will have unique information and access to clients and potential clients that
an outsider would lack, extending Taheri to cover solicitation of one’s
firm’s own potential clients would have broader impacts on law firms’ abilities
to conduct litigation on behalf of their clients. Defendant does not cite law
supporting this application of Taheri, and the Court is not prepared to
make such an extension without authority.
The Court therefore concludes that Plaintiff’s claims do not
concern protected activity.
The Court denies the anti-SLAPP motion because it does not
meet the first prong of the anti-SLAPP statute.
The Court also denies the anti-SLAPP motion on the alternate
grounds that, even if the first prong were met, Plaintiff has shown a
probability of success on the merits.
Once a defendant has met its initial burden and established
that the anti-SLAPP statute applies, the burden shifts to the plaintiff to
demonstrate a “probability” of success on the merits. (Code Civ. Proc., §
425.16, subd. (b).) “[T]he 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.” (Matson v. Dvorak, supra, 40 Cal.App.4th
at p. 548, internal quotations omitted.)
A plaintiff need only show “a minimum level of legal
sufficiency and triability[.]” (Linder v. Thrifty Oil Co. (2000) 23
Cal.4th 429, 438, fn. 5.) “In opposing an anti-SLAPP motion, the plaintiff
cannot rely on the allegations of the complaint, but must produce evidence that
would be admissible at trial. [Citation.] Thus, declarations may not be based
upon “information and belief” [citation] and documents submitted without the
proper foundation are not to be considered. [Citation.] The court considers the
pleadings and evidence submitted by both sides, but does not weigh credibility
or compare the weight of the evidence. Rather, the court's responsibility is to
accept as true the evidence favorable to the plaintiff [citation] and evaluate
the defendant's evidence only to determine if it has defeated that submitted by
the plaintiff as a matter of law. [Citation.] The trial court merely determines
whether a prima facie showing has been made that would warrant the claim going
forward.” (HMS Capital, Inc. v. Lawyers Title Co. (2004) 118 Cal.App.4th
204, 212.)
Clauses
of the anti-SLAPP statute defining protected activity to include statements
made before or in connection with an issue under review by a judicial body “are
parallel to and coextensive with the definition of privileged communications
under Civil Code section 47, subdivision (b).” (Ruiz v. Harbor View
Community Assn., supra, 134 Cal.App.4th at p. 1474.)
As
discussed above, Defendant’s alleged misconduct did not consist of litigation
advice, but rather centered on Defendant’s alleged deception of the clients
into signing with him, believing that they were signing with Plaintiff. This
conduct is not “incidental or reasonably related to an actual petition or
actual litigation or to a claim that could ripen into a petition or litigation[.]”
(Tichinin v. City of Morgan Hill (2009) 177 Cal.App.4th 1049, 1068.) The
litigation privilege therefore does not apply.
Plaintiff
has made an adequate evidentiary showing. Plaintiff has shown that Rolland
intended to sign with Plaintiff and actually attempted to do so. Plaintiff has
provided a declaration from Rolland stating in no uncertain terms that
Defendant deceived her into signing with him instead of Plaintiff. Further, the
judicially notice of settlement in the Rolland case provides prima facia
evidence of damages.
The Court therefore concludes that Plaintiff has shown an adequate probability of success and denies the motion on this basis as well.