Judge Mitchell L. Beckloff, Case Number: 23STCV18166, Date: 2023-09-13 Tentative Ruling

Judge: Mitchell L. Beckloff, Case: 23STCV18166, Date: 2023-09-13 Tentative Ruling

Plaintiffs, Alan Wayne Lindeke, Steven Sugarman, Thedora Nickel, and Carlos Salas, seek a preliminary injunction restraining Defendant, Adam Levine, from (1) making any further illegal recordings of Plaintiffs; (2) using in any manner, distributing, disseminating, sharing, transferring, publishing, uploading, sending, mailing, and/or posting online and providing to any person, persons, entities, or the public at large, the recordings already taken between Plaintiffs and Defendant, any transcript of the same, and/or any information derived from such recordings; and (3) deleting the recordings already taken between Plaintiffs and Defendant that are located on ’s Drop Box account.

On August 18, 2021, the court denied Plaintiffs’ third request for a temporary restraining order. The court did, however, set the matter for further briefing and a hearing on Plaintiffs’ request for a restraining order. Defendant opposes Plaintiffs’ request.

Plaintiffs’ request for judicial notice (RJN) of exhibits A through HH is denied. The court cannot locate a single citation to Plaintiffs’ RJN in the moving or reply papers. Thus, the material is irrelevant.

Defendant’s RJN is granted as to Exhibit 1 and denied as to Exhibit 2 (news articles).

Declaration of Lindsay Valdeon: The court overrules objections 1, 2, 4, 5 and 14 based on the grounds stated. The court sustains objection 8 based on the grounds stated. The court sustains in part objections 3 (as to “of meetings . . . Theodora Nickel”), 6 (as to second sentence only), 7 (as to “or previously made public” and “As further explained . . . and Change”), 9 (as to all that follows March 29, 2023), 10 (as to the last sentence only), 12 (as to the last sentence only), and 13 (as to all except the first sentence).

Declaration of Reverend Everett Bell: Based on the grounds stated, all objections are overruled.

Declaration of Blake Brooks: Objections 5, 6 and 7 are sustained. The remaining objections are overruled based on the grounds stated.

Declaration of Carlos Salas:[1] Objections 4, 5 and 6 are sustained. Objection 3 is overruled. Objections 1 and 2 are sustained in part (as to the second sentence for each objection).

Declaration of Alan Wayne Lindeke: Objections 2, 3, 4, 6, 7, 8, 9 and 11 are overruled on the grounds stated. Objections 5, 10, 12 and 13 are sustained. Objection 1 is sustained in part (as to the second sentence).

Second Declaration of Steven Sugarman: Objections 2, 4, 10, 11 and 14 are overruled based on the grounds stated. Objections 5, 6, 9 and 12 are sustained. The court sustains in part objections 1 (as to the first and second sentence), 3 (as to the second, third, fourth, fifth and seventh sentence), 7 (as to all except the penultimate sentence), 8 (as to all except the last sentence) and 13 (as to “Mr. White . . . clearly Mr. Levine”).

Declaration of Zien Halwani: Objection 1 is overruled. The balance of the objections are sustained.

Declaration of Adam Levine: Objections 7 and 8 are sustained. The balance of the objections are overruled on the grounds stated.

“[A] court will deny a preliminary injunction unless there is a reasonable probability that the plaintiff will be successful on the merits, but the granting of a preliminary injunction does not amount to an adjudication of the merits.” (Beehan v. Lido Isle Community Assn. (1977) 70 Cal.App.3d 858, 866.) “The function of a preliminary injunction is the preservation of the status quo until a final determination of the merits.” (Ibid.)

As the parties recognize, “[t]rial courts traditionally consider and weigh two factors in determining whether to issue a preliminary injunction. They are (1) how likely it is that the moving party will prevail on the merits, and (2) the relative harm the parties will suffer in the interim due to the issuance or nonissuance of the injunction.” (Dodge, Warren & Peters Ins. Services, Inc. v. Riley (2003) 105 Cal.App.4th 1414, 1420.) “[T]he greater the . . . showing on one, the less must be shown on the other to support an injunction.” (Ibid. [quoting Butt v. State of California, (1992) 4 Cal.4th 668, 678].) The burden of proof is on the plaintiff as the moving party “to show all elements necessary to support issuance of a preliminary injunction.” (O'Connell v. Superior Court (2006) 141 Cal.App.4th 1452, 1481.)

Preliminary injunctive relief requires the use of competent evidence to create a sufficient factual showing on the grounds for relief. (See, e.g., Ancora-Citronelle Corp. v. Green (1974) 41 Cal.App.3d 146, 150.) A plaintiff seeking injunctive relief must also show the absence of an adequate damages remedy at law. (Code Civ. Proc., § 526, subd. (a)(4).)

A preliminary injunction ordinarily cannot take effect unless and until the plaintiff provides an undertaking for damages which the enjoined defendant may sustain by reason of the injunction if the court finally decides that the plaintiff was not entitled to the injunction. (See Code Civ. Proc., § 529, subd. (a); City of South San Francisco v. Cypress Lawn Cemetery Ass’n., (1992) 11 Cal. App. 4th 916, 920.)

Plaintiffs’ complaint alleges causes of action for invasion of privacy (Pen. Code, sections 632 and 632.7) and injunctive relief.[3]

A person who, intentionally and without the consent of all parties to a confidential communication, uses an electronic amplifying or recording device to eavesdrop upon or record the confidential communication . . . shall be punished by a fine not exceeding two thousand five hundred dollars ($2,500) . . . .

Penal Code section 637.2, subdivision (a) allows “[a]ny person who has been injured by a violation of this chapter [to] bring an action against the person who committed the violation . . . .”

Plaintiffs assert Defendant intentionally recorded conversations he had with Plaintiffs; those recorded conversations contained confidential communications.

To meet their burden of demonstrating Defendant violated Penal Code section 632, subdivision (a)—surreptitious recordation of confidential communications—Plaintiffs rely on the following evidence:

[Defendant] has personally told me, on multiple occasions, that it is his practice to record phone calls and meetings, including conversations with Steven Sugarman, Carlos Salas, Alan Lindeke, and Thedora Nickel and storing the recordings of those conversations utilizing his Drop Box account and an online transcription and storage application I believe to be known as ‘Sonix.’ (Valdeon Decl., ¶ 3; Memo 9:26-27.)

Plaintiffs link Defendant’s statement made to Valdeon to meetings conducted on January 24 and February 16, 2023 by inference. Defendant did not advise Plaintiffs he was recording the meetings held January 24 and February 16, 2023. (See, e.g., Nickel Decl., ¶ 5; Sugarman Decl.,

¶ 7; Lindeke Decl. ¶ 6; Salas Decl. ¶ 6.) Plaintiffs also produce evidence Defendant admitted in a text message to Sugarman that he had been recording conversations with him. (Sugarman Decl., ¶ 14; Memo 17:21-23.) Finally, Plaintiffs produce evidence Defendant has more than 100 (unidentified) recordings in his possession on a Drop Box account. (Valdeon Decl., ¶ 4.)[4]

Defendant denies Plaintiffs’ claims of surreptitious recordings. He claims this action is to “harass and punish” him. (Levine Decl., ¶ 5.) Defendant explains he reported The Change Company, LLC (TTC) to federal authorities for “false and deceptive tactics in their lending practices and marketing.” (Levine Decl., ¶ 4.) After TCC terminated Defendant, Defendant filed a “wrongful termination and whistleblower retaliation lawsuit against TCC, which is currently pending in Orange County Superior Court.” (Levine Decl., ¶ 5.)

I never illegal recorded Steven Sugarman, Alan Wayne Lindeke, Lindsay Valdeon, Carlos Salas, or Thedora Nickel at any time. Mr. Sugarman’s statement in his Declaration that I texted him and told him that I have “a practice of recording conversations” that I had with him and Alan Wayne Lindeke, Lindsay Valedon, Carlos Salas, and Thedora Nickel, “including conversations held during confidential meetings,” is simply false.

I never recorded TCC meetings, including TCC “meetings” attended by one or more of the Plaintiffs , as alleged in Plaintiffs’ Complaint.

At no time did I record phone calls I had with any of the Plaintiffs. (Levine Decl., ¶¶ 6, 7, 8.)

While I was employed with TCC, I would sometimes be asked to make recordings of press calls and presentations, which I later edited for Steven Sugarman. These recordings were made as part of my media relations role and were made at Mr. Sugarman’s direction with his consent and knowledge. At no time did I ever record Mr. Sugarman for these purposes (or at any other time) without his consent and knowledge. (Levine Decl., ¶ 10.)

In response to Defendant’s claim he never told Sugarman “he has been recording his conversations and stated “ . . . [g]iven the importance of my words in the execution of [his] duties as a communications professional, it is a practice [he has] employed since 2004” (Sugarman Decl., ¶ 14), Plaintiffs submit the relevant text message. The message states in full:

Actually it’s up to you. Alan has made this situation very very bad by lying about what I said. You need to explain to him that while it is certainly illegal for me to record my telephone conversations in CA, in every State is it 100% legal for me to record MY OWN VOICE and my end of a conversation. Given the importance of my words in the execution of my duties as a communications professional, it is practice I have employed since 2004. Ove the years it has helped with some semantically imprecise reporters—never thought a general counsel of a company I worked for would be so stupid, but here we are. (Third Sugarman Decl., Ex. A.)

To be clear, Defendant did not advise, as reported by Plaintiffs, “he had been recording conversations he had with Plaintiffs, including conversations held during meetings.” (Memo 17:22-23.) Plaintiffs’ suggestion Defendant admitted this—that is, “recording conversations with Plaintiffs, including conversations held during meetings”—is a practice he has used since 2004 is an inaccurate and misleading twist of the evidence.

Plaintiffs contend they have “direct and clear evidence [Defendant] illegally recorded them.” Plaintiffs argue Defendant admitted he did so, and there is an eyewitness who “confirmed seeing the recordings.” (Reply 3:21-24.) Plaintiffs contend these “two key pieces of evidence are unchallenged.” (Reply 3:26-27.) Plaintiffs label Defendant’s denials “vacillating and inconsistent.” (Reply 4:2.) Parsing through Defendant’s denials, they suggest Defendant’s “self-serving testimony cannot be credited given the powerful countervailing evidence on the subject.”[5] (Reply 4:7-8.)

The court’s view of the evidence is distinctly different than that of Plaintiffs.

First, the court finds Plaintiffs’ case-in-chief quite anemic. There is nothing in the declarations of Sugarman, Lindeke, Salas or Nickel that establishes Defendant illegally recorded their confidential communications. Salas and Nickel’s statements have no evidentiary value—they are based on information and belief. (Salas Decl., ¶ 5; Nickel Decl., ¶ 4.) Other statements by Salas and Nickel assume facts not in evidence. (Salas Decl., ¶ 6; Nickel Decl., ¶ 5 [Defendant did not disclose he was recording].) Lindeke’s statements offered to incriminate Defendant assume facts not in evidence (see, e.g., Lindeke Decl., ¶¶ 5, 6, 8, 18) and do not otherwise provide any evidence Defendant illegally recorded him. Finally, Sugarman’s declarations do not inform on illegal recording and relies on the statements of Valdeon. (Second Sugarman Decl., ¶ 4.) Sugarman also does not dispute Defendant’s statement that any recording he did of Sugarman was at Sugarman’s “direction and with his consent and knowledge” for Defendant’s role in media relations with TCC.

Second, Defendant’s March 11, 2023 text message to Sugarman is ambiguous at best. (Third Sugarman Decl., Ex. B.)[6] It is clear to the court, however, Sugarman misrepresented the scopoe of the evidence to support Plaintiffs’ theory of the case. Defendant made no representation he “had a practice of recording conversations he had with Plaintiffs, including conversations held during confidential meetings.” (Sugarman Decl., ¶ 2 [emphasis added.) In fact, Defendant expressed his understanding that surreptitious recording of confidential communications is illegal and noting preclude him recording his “OWN VOICE and [his] end of a conversation.” (Third Sugarman Decl., Ex. B.)

Finally, Valdeon’s statements are expressly contradicted by Defendant. (Compare Valdeon Decl., ¶ 3 with Levine Decl., ¶ 11.) The court notes Plaintiff has not disputed Defendant’s statement Valdeon had used Defendant’s Sonix account “regularly” and “uploaded hundreds of audio files to [his] account Sonix [sic] from November 2018 to March 2023.” (Levine Decl.,

¶ 11.) Moreover, that Defendant had more than 100 recordings in his possession does not speak to content. (Valdeon Decl., ¶ 4.)[7]

Based on the evidence before the court, the court finds Plaintiffs have not demonstrated any real likelihood of success on the merits of their Penal Code section 632 claim.[8] The court finds Defendant’s express and specific denials more persuasive then the evidence proffered by Plaintiffs.

The second part of the preliminary injunction analysis requires the court to evaluate the harm the plaintiff is likely to sustain if the preliminary injunction is denied compared to the harm the defendant is likely to suffer if the injunction is issued. (IT Corp. v. County of Imperial (1983) 35 Cal.3d 63, 69-70.) “However, ‘[a] trial court may not grant a preliminary injunction, regardless of the balance of interim harm, unless there is some possibility that the plaintiff would ultimately prevail on the merits of the claim.’ ” (Law School Admission Council, Inc. v. State of California (2014) 222 Cal.App.4th 1265, 1280 [quoting Butt v. State of California (1992) 4 Cal.4th at 678].)

Given Plaintiffs’ failure to show a likelihood of success on the merits of their claim, they must make a greater showing of relative harm. (Butt v. State of California, supra, 4 Cal.4th at 678.)

Plaintiffs contend “if the injunction were to be denied, Plaintiffs will undoubtedly suffer irreparable harm. The unauthorized disclosure of the recorded conversations is a clear invasion of privacy rights and poses significant risks to Plaintiffs’ reputations.” (Memo 21:5-7.) Plaintiffs argue once private conversations are released to unauthorized listeners, “the genie cannot be put back in the bottle.” (Memo 21:12-13.) Plaintiffs assert the release of the information would harm their reputational interests.[9] (Memo 21:21-23.) Plaintiffs’ claims of harm are quite general.

Defendant contends any restraint on his speech directly injures his First Amendment rights under the Constitution. “A prohibition against disclosing confidential information constitutes a prior restraint.” (Evans v. Evans (2008) 162 Cal.App.4th 1157, 1169.) “Prior restraints are highly disfavored and presumptively violate the First Amendment. This is true even when the speech is expected to be of the type that is not constitutionally protected.” (Id. at 1167.) That said, according to Plaintiffs’ allegations, Defendant illegally obtained the recordings, and Defendant has not suggested any alleged illegal recordings are matters of public interest. (See Bartnicki v. Vopper (2001) 532 U.S. 514, 528.) The propriety of a restraint turns on the particular circumstances involved. (See Evans v. Evans, supra, 162 Cal.App.4th at 1170 [balancing test].) “Before trial and upon a proper showing, a court may prohibit a party from . . . disclosing certain specified private information under narrowly drawn circumstances. (Id. at 1161.)

Plaintiffs’ showing of the harm they will suffer if the injunction is not granted lacks any specifics. The court acknowledges information released is forever released. Whether the release of information is harmful, however, turns on the nature of the information released. For example, it would be hard to find any real harm would be suffered by Plaintiffs if the information illegally obtained (as they argue) and released concerned a discussion about local restaurants, sporting events or movies. The information may have been obtained illegally for which the recorder may suffer consequences under Penal Code section 637.2. Nonetheless, the nature of the information released is innocuous and no real harm would be suffered.

On the other side of the balance is the implication of Defendant’s First Amendment rights with any preliminary injunction. There can be no question Defendant’s First Amendment rights will be impinged by an order precluding Defendant’s communication. Plaintiffs seek, in part, to enjoin Defendant from disseminating information Defendant “derived” from any of the recordings. Further, mandating that Defendant delete any recordings is a mandatory injunction for which a substantially strong showing on the merits is required.

Based on Plaintiffs’ lack of showing specific harm they will suffer and Defendant’s certain harm to his First Amendment rights, the court finds the balance of harms tips in Defendant’s favor.

For the foregoing reasons, Plaintiffs’ request for a preliminary injunction is denied.

[Even assuming the balance of harms tipped in Plaintiffs’ favor, the results here would be no different. The court concludes Plaintiffs’ showing on the merits so inadequate and their showing of harm so minimal that an injunction under these facts is not appropriate.]

[1] The Declaration of Thedora Nickel is nearly identical to the Declaration of Carlos Salas. The court’s physical copy of Plaintiffs’ third ex parte application did not contain either declaration; the court found the declarations on the electronically filed copy. Defendant shall advise whether he received the Declaration of Thedora Nickel.

[2] The court acknowledges the manner in which Plaintiffs’ resubmitted the declaration is problematic. Nonetheless, the Declaration of Steven Sugarman (standing alone) could have been resubmitted to the court to support Plaintiffs’ request for a restraining order. Moreover, from the contents of the third ex parte application it is clear Plaintiffs’ relied on the initial declaration from Sugarman. The declaration contains objectionable material identical to that to which the court sustained Defendant’s’ evidentiary objections.

[3] “Injunctive relief is a remedy, not a cause of action. [Citations.] A cause of action must exist before a court may grant a request for injunctive relief.” (Allen v. City of Sacramento (2015) 234 Cal.App.4th 41, 65.)

[4] The court sustained on foundation grounds evidence of the content and participants in those recordings.

[5] The court finds Defendant’s counsel’s unwillingness to settle the issue outside of a hearing irrelevant to the substantive merits of Plaintiffs’ claim.

[6] The court initially struck Sugarman’s testimony about the text message on secondary evidence grounds. Sugarman’s third declaration now includes the text message.

[7] Contrary to Defendant’s position, Defendant’s statements are not inadmissible hearsay. (Evid. Code, 1220.)

[8] But for paragraph 3 of the Valedon declaration, the court would find Plaintiffs have demonstrated no ability to prevail on the merits of their claim. Given the unrebutted evidence of Valedon’s use of the Sonix program and her suggestion Defendant uses an application “I believe to be known as ‘Sonix’ ”, the court views Valedon’s statements with some skepticism. (Valdeon Decl., ¶ 3; See Levine Decl., ¶ 11.)

[9] There is no suggestion in the evidence why releasing the information would harm Plaintiffs’ reputation. While, for obvious reasons, Plaintiffs are not required to disclose the information they are attempting to protect from release, the nature of the conversations might be helpful to an analysis of harms, i.e., trade secrets, personal social information, etc.