Judge: Robert S. Draper, Case: 20STCV05566, Date: 2023-05-03 Tentative Ruling
Case Number: 20STCV05566 Hearing Date: May 3, 2023 Dept: 78
Superior Court of California
County of Los Angeles
Department 78
TRINA ALLEN,
Plaintiff,
vs.
MATTHEW SHEPHERD, et al.,
Defendants. Case No.: 20STCV05566
Hearing Date: May 3, 2023
[TENTATIVE] RULING RE:
DEFENDANT CATAMOUNT PROPERTIES 2018 LLC’S ANTI-SLAPP MOTION TO STRIKE AND DEFENDANT CATAMOUNT PROPERTIES 2018 LLC’S DEMURRER TO THE THIRD AMENDED COMPLAINT OF PLAINTIFF TRINA ALLEN
The Court finds that Judge Draper is unavailable to hear this matter. The Court held oral argument on this motion on May 3, 2023.
Defendant Catamount Properties 2018 LLC’s Anti-SLAPP Motion to Strike the Third Amended Complaint of Trina Allen is GRANTED.
Defendant Catamount Properties 2018 LLC’s Demurrer to the Third Amended Complaint is OVERRULED as moot.
Moving party to provide notice and to file proof of service of such notice within five court days after the date of this order.
FACTUAL BACKGROUND
This is a wrongful foreclosure action concerning residential property located at 810 E. 76th Place, Los Angeles, California (the “Property”). (TAC ¶ 1.) The operative Third Amended Complaint alleges as follows.
Plaintiff Trina Allen’s (“Plaintiff”) mother (“Decedent”) passed away in 2014; Plaintiff served as Executor of Decedent’s estate. (TAC ¶ 8.) There were four heirs to Decedent’s estate. (TAC ¶ 9.) Two of the heirs wished to receive cash for their interest in the estate. (Ibid.) Plaintiff’s sister, Donna Allen (“Donna”), agreed to take certain real estate properties. (Ibid.)
Prior to Decedent’s death, Decedent created an intervivos trust to hold real property, including real property located at 810 E. 76th St., Los Angeles (the “Subject Property”). (TAC ¶ 10.) Plaintiff resided in the Subject Property to care for Decedent prior to Decedent’s death and continued to reside there after her death. (Ibid.)
To raise cash for the two sisters who wished to be bought out of the estate, Plaintiff saw defendant loan broker Lou Brown (“Brown”). (TAC ¶ 11.) Plaintiff completed a loan application with accurate information for Brown, who did not provide Plaintiff with a copy of the application. (Ibid.) Shortly thereafter, Brown contacted Plaintiff to inform her that Brown needed to restructure the loan application to show that Plaintiff was not residing at the Subject Property and asked her to fill in a different address; Plaintiff refused. (TAC ¶ 12.) Then, Brown’s notary provided Plaintiff with a loan application with many blank spaces and informed Plaintiff that Brown would complete it. (Ibid.) As Plaintiff was in a rush to receive a loan for an upcoming court hearing, she agreed to sign the incomplete application, and to sign a blank promissory note and deed of trust. (Ibid.) Brown informed Plaintiff that he had obtained a loan based on the latter application, but did not provide Plaintiff a copy of the note, deed of trust, and loan application when she requested it. (TAC ¶ 13.)
After the loan was funded, Plaintiff was unable to find or contact Brown. (TAC ¶ 14.) Plaintiff hired an attorney, who was able to obtain a copy of the loan application and relevant paperwork. (Ibid.) In reviewing the loan application and relevant paperwork, Plaintiff discovered that Brown had lied repeatedly on the application and had lied to Plaintiff about the material terms of the loan. (TAC ¶¶ 15-20.)
When Plaintiff attempted to refinance this loan with defendant Matthew Shepherd (“Shepherd”) through defendant Superior Loan Financing (“Superior” and with Shepherd, the “Superior Defendants”), Plaintiff discovered that contrary to Brown’s representations, title to the Subject Property was not transferred from Decedent to Plaintiff. (TAC ¶ 22.) Plaintiff, through the probate court, transferred title to the Subject Property from Decedent to Decedent’s intervivos trust, of which Donna was trustee. (TAC ¶ 23.)
Donna and Plaintiff attempted to refinance the loan to pay off Shepherd, but could not because the Superior Defendants had filed a notice of default without sending such notice to Plaintiff. (TAC ¶ 25.) Harari told Plaintiff that the default was due to an illegal transfer of title on the Subject Property, while the notice of default stated that default was due to failure to pay. (TAC ¶ 26.)
Plaintiff alleges that Harari and Shepherd worked together to prevent Plaintiff from obtaining refinancing of the Superior Defendants’ loan. (TAC ¶ 28.) Defendants foreclosed on the Subject Property based on these fraudulent notices of default. (TAC ¶ 44.)
PROCEDURAL HISTORY
On February 13, 2020, Plaintiff filed the Complaint against Matthew Shepherd, Superior Loan Servicing, and Does 1-10 asserting seven causes of action:
1. Declaratory Relief;
2. Contractual Breach of Good Faith and Fair Dealing;
3. Accounting;
4. Unfair Business Practices;
5. Recission;
6. Breach of Fiduciary Duty; and,
7. Injunctive Relief.
On May 20, 2020, Plaintiff filed the First Amended Complaint against Shepherd, Superior Loan Servicing, Lou Brown, and Barry Harari asserting four causes of action:
1. Wrongful Foreclosure;
2. Breach of Good Faith and Fair Dealing;
3. Unfair Business Practices; and,
4. Declaratory Relief.
On December 29, 2020, Plaintiff filed the Second Amended Complaint against Shepherd, Superior, Brown, Harari, and Catamount Properties 2018, LLC (“Catamount”), asserting three causes of action:
1. Fraud and Misrepresentation;
2. Breach of Good Faith and Fair Dealing; and,
3. Unfair Business Practices.
On June 8, 2021, Plaintiff filed the operative Third Amended Complaint against same Defendants asserting two causes of action:
1. Fraud and Misrepresentation; and,
2. Unfair Business Practices.
On December 1, 2021, Shepherd filed a Cross-Complaint against Plaintiff asserting ten causes of action:
1. Fraud;
2. Negligent Misrepresentation;
3. Breach of Contract;
4. Breach of Covenant of Good Faith and Fair Dealing;
5. Breach of Fiduciary Duty;
6. Negligence;
7. Negligence Per Se;
8. Indemnity;
9. Contribution; and,
10. Declaratory Relief.
On September 21, 2022, default was entered against Plaintiff as to the Cross-Complaint.
On November 29, 2022, Catamount filed the instant Demurrer to the Third Amended Complaint and Anti-SLAPP Motion to Strike (“Anti-SLAPP Motion”).
On December 9, 2022, Plaintiff filed an Opposition to the instant Demurrer.
On February 10, 2023, Plaintiff filed an Opposition to the instant Anti-SLAPP Motion.
On February 17, 2023, Catamount filed Replies in support of both motions.
On February 27, 2023, the Court heard the instant motions and took the matters under submission.
DISCUSSION
I. JUDICIAL NOTICE
The court may take judicial notice of “official acts of the legislative, executive, and judicial departments of the United States and of any state of the United States,” “[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,” and “[f]acts and propositions that are not reasonably subject to dispute and are capable of immediate and accurate determination by resort to sources of reasonably indisputable accuracy.” (Evid. Code § 452,¿subds. (c), (d), and (h).)
Catamount requests judicial notice of the following:
1. Complaint for Unlawful Detainer and related filings for Catamount Properties 2018, LLC v. Trina Allen. (Ex. 1.)
2. Second Amended Complaint for Trina Allen v. Matthew Shepherd, et al. (Ex. 2.)
3. Plaintiff Trina Allen’s Motion for Preliminary Injunction. (Ex. 3.)
4. The Court’s Ruling on Catamount’s Motion for Summary Judgment dated March 24, 2021. (Ex. 4.)
5. The Court’s Ruling on Plaintiff Trina Allen’s Motion for Preliminary Injunction dated April 29, 2021. (Ex. 5.)
Catamount’s Requests for Judicial Notice are GRANTED.
II. ANTI-SLAPP MOTION
Catamount moves to strike Plaintiff’s Third Cause of Action for Violation of Business & Professions Code section 17200 pursuant to Code of Civil Procedure section 425.16. This is the only cause of action in which Catamount is named.
In assessing a defendant’s section 425.16 special motion to strike, the court must engage in a twostep 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. (Id.) 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 425.16(e). If the defendant meets his initial burden, then the burden shifts to the plaintiff to establish a probability that the plaintiff will prevail on the claim—i.e., present facts which would, if proved at trial, support a judgment in the plaintiff’s favor. (Id. at 15051.)
In making its determination of the anti-SLAPP motion, the court shall consider the pleadings, and supporting and opposing affidavits stating the facts upon which the liability or defense is based. (Code Civ. Proc., § 425.16(b)(2).) However, the court does not “weigh credibility [nor] compare the weight of the evidence. Rather, [the court] accepts as true the evidence favorable to the plaintiff and evaluates the defendant’s evidence only to determine if it has defeated that submitted by the plaintiff as a matter of law.” (Flatley v. Mauro (2006) 39 Cal.4th 299, 326.)
A. Protected Activity
Moving parties have the initial burden to demonstrate that a cause of action is subject to a special motion to strike. (Martinez v. Metabolife Inter. Ins. (2003) 113 Cal.App.4th 181, 186; Fox Searchlight Pictures Inc. v. Paladino (2001) 89 Cal.App.4th 294, 304.) Specifically, courts decide whether moving parties have made a prima facie showing that the attacked claims arise from a protected activity, including defendants’ right of petition, or free speech, under the Constitution, in connection with issues of public interest. (Healy v. Tuscany Hills Landscape & Recreation Corp. (2006) 137 Cal.App.4th 1, 5; Soukup v. Law Offices of Herbert Hafif (2006) 39 Cal.4th 260, 278; Paulus v. Bob Lynch Ford, Inc. (2006) 139 Cal.App.4th 659, 671; Equilon Ent. v. Consumer Cause (2002) 29 Cal.4th 53, 67; Gov. Gray Davis Committee v. Amer. Taxpayers Alliance (2002) 102 Cal.App.4th 449, 458-59; CCP §425.16(e).) Moving parties can satisfy their burden by showing (1) statements made before legislative, executive or judicial proceedings, or made in connection with matters being considered in such proceedings, or (2) statements made in a public forum, or other conduct in furtherance of the exercise of the constitutional rights of petition or free speech, in connection with issues of public interest. (CCP §425.16(e); Equilon Ent., LLC v. Consumer Cause, Inc. (2002) 29 Cal.4th 53, 66.)
Here, Catamount contends that the gravamen of Plaintiff’s claim against Catamount is that Catamount wrongfully refused to dismiss its Unlawful Detainer action against Catamount. Catamount argues that the Unlawful Detainer proceedings, along with any papers filed in connection with that proceeding, constitute a protected activity under Code of Civil Procedure section 425.16(e).
In Opposition, Plaintiff argues that the gravamen of Plaintiff’s Complaint is not the Unlawful Detainer action, but Catamount’s purchase of the Subject Property at a nonjudicial foreclosure sale. Plaintiff notes that nonjudicial foreclosures “do[] not concern an issue under official review that require[s] a determination to be based upon the exercise of defendant’s free speech or petition rights. Rather, defendant and plaintiff engaged in business dealings or transactions of a contractual nature, leading to defendant initiating private nonjudicial foreclosure proceedings, which plaintiff claims were unjustified.” (Garretson v. Post (2007) 156 Cal.App.4th 1508, 1520.)
As such, the controlling question here is whether the gravamen of Catamount’s alleged misconduct was related to the nonjudicial foreclosure sale, which is not a protected activity, or the unlawful detainer proceeding, which is protected as a judicial proceeding under section 425.16(e).
Upon review of the Third Amended Complaint, the Court finds that the gravamen of Plaintiff’s allegations regards the unlawful detainer proceeding rather than the nonjudicial foreclosure sale.
The Third Amended Complaint alleges that Catamount “has refused to dismiss its unlawful detainer proceeding leaving Plaintiff at the risk of losing possession of the family home, despite the fact that the foreclosure sale was void.” (TAC ¶ 61.) While the Third Amended Complaint also alleges that the foreclosure sale was unlawful as “Superior and Shepherd agreed to sell Catamount the property in foreclosure having full knowledge that Superior did not possess the title that they purported to transfer to Catamount,” at no point does the TAC allege that Catamount had knowledge of the alleged fraudulent nature of the title before it purchased the property. Rather, Plaintiff’s complaint is that, in the context of the unlawful detainer proceeding, Plaintiff advised Catamount that the foreclosure sale was void, but yet Catamount refused to dismiss its unlawful detainer proceeding against Plaintiff.
The Complaint explicitly ties Catamount’s misconduct to the unlawful detainer proceeding, while conceding that Catamount’s lacked knowledge of any alleged defect in the title at the time of the nonjudicial foreclosure sale. Indeed, Plaintiff alleges that “Catamount was enticed by the false documents to bid . . . at the foreclosure sale to obtain what they thought would be valid title to the property.” (TAC ¶ 53.)
Accordingly, the Court finds that the gravamen of Plaintiff’s complaint as to Catamount regards Catamount’s refusal to dismiss the unlawful detainer proceeding.
Catamount has met its initial burden of showing that the Third Cause of Action arises from a protected activity. Here, the unlawful detainer complaint was a written statement made in a judicial proceeding and is thus considered protected activity under the anti-SLAPP statute. Here, the cause of action brought against Catamount clearly arises from the protected activity of bringing the unlawful detainer action in the first instance.
The burden now shifts to Plaintiff to show a probability of success on the merits.
B. Probability of Success on the Merits
Once a defendant has 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(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].)
In this step, a court may consider evidence if “reasonably possible” that the evidence will be admissible at trial and may not consider evidence that could “never be” admitted at trial. (Sweetwater Union High School Dist. v. Gilbane Building Co. (2019) 6 Cal.5th 931.)
Here, as to the merits of its cause of action, Plaintiff states only that “it cannot be disputed that Catamount did not receive proper title to the Property and was warned not to proceed with the non-judicial foreclosure sale. Since the sale, the Defendant Catamount has allowed the Property to fall into disarray, to the detriment of Plaintiff.” (Opposition at pgs. 5-6.) Here, Plaintiff makes assertions that are at odds with the allegations in the complaint, which allege that Defendant Catamount was duped at the judicial foreclosure sale. Moreover, Plaintiff does not back those assertions with a citation to any evidence whatsoever.
Despite Plaintiff’s assertion of what “cannot be disputed,” Plaintiff provides no declaration or other form of potentially admissible evidence demonstrating the merits of its Cause of Action. Absent potentially admissible evidence, the Court cannot find that Plaintiff is likely to succeed on the merits.
Accordingly, Defendant Catamount Properties 2018 LLC’s Anti-SLAPP Motion to Strike is GRANTED.
As the Motion to Strike is granted and disposes of the only cause of action in which Catamount is a named defendant, Catamount’s Demurrer to the Third Amended Complaint is OVERRULED as moot.
DATED: May 3, 2023
________________________________
Hon. Jill Feeney
Judge of the Superior Court
