Judge: Theresa M. Traber, Case: 22STCV14435, Date: 2023-01-27 Tentative Ruling

Case Number: 22STCV14435    Hearing Date: January 27, 2023    Dept: 47

Tentative Ruling

Judge Theresa M. Traber, Department 47

HEARING DATE:     January 27, 2023                   TRIAL DATE: NOT SET

CASE:                         Synergy Development Alliance, LLC v. Novian & Novian, LLP et al.

CASE NO.:                 22STCV14435           

 SPECIAL MOTION TO STRIKE (CCP § 425.16) 

MOVING PARTY:               Defendants Novian & Novian, LLP, Farhad Novian, Judith Manouchehri, and Elliot Kermani

RESPONDING PARTY(S): Plaintiff Synergy Development Alliance, LLC.

STATEMENT OF MATERIAL FACTS AND/OR PROCEEDINGS:

            This legal malpractice case was filed on April 9, 2022.  In the First Amended Complaint, filed on October 27, 2022, Plaintiff alleges that Defendants misled Plaintiff as to the fees for drafting a partnership agreement for a residential project.

Defendants specially move to strike the first cause of action for fraud in the inducement and third cause of action for breach of contract under Code of Civil Procedure section 425.16.          

TENTATIVE RULING:

Defendants’ special motion to strike under Code of Civil Procedure § 425.16 (also called an Anti-SLAPP motion) is DENIED.  

DISCUSSION:

Defendants specially move to strike the first cause of action for fraud in the inducement and third cause of action for breach of contract under Code of Civil Procedure section 425.16.

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Plaintiff’s Request for Judicial Notice

Plaintiff requests that the Court take judicial notice of the First Amended Complaint in this action. Plaintiff’s request is GRANTED pursuant to Evidence Code section 452(d) (court records).

Defendants’ Evidentiary Objections

Defendants’ evidentiary objections Nos. 1 through 17 are OVERRULED. To the extent that Defendants object that the statements lack sufficient foundation and the documents lack proper authentication, the objections are not well taken. Neither are Defendants objections on relevance, speculation, legal conclusions, or vagueness and ambiguity well taken by the Court. Additionally, to the extent that Plaintiffs object on hearsay grounds, that objection is not appropriate in this context, given that non-hearsay-based testimony could be offered at trial to support all the challenged evidence. (Sweetwater Union High School Dist. v. Gilbane Building Co. (2019) 6 Cal.5th 931, 947-949.) 

Legal Standard

In ruling on a defendant’s special motion to strike, the trial court uses a “summary-judgment-like procedure at an early stage of the litigation. (Varian Medical Systems, Inc. v. Delfino (2005) 35 Cal.4th 180, 192.) This is a two-step process. First, the defendant must show that the act or acts of which the plaintiff complains were taken “in furtherance of the [defendant]’s right of petition or free speech under the United States or California Constitution in connection with a public issue.” (Code Civ. Proc. §425.16(b)(1).) Second, if the defendant carries that burden, the burden shifts to the plaintiff to demonstrate a probability of prevailing on the claim. (Code Civ. Proc. § 425.16(b)(3).) The defendant has the burden on the first issue, and the plaintiff on the second. (Kajima Engineering & Construction, Inc. v. City of Los Angeles (2002) 95 Cal.App.4th 921, 928; Rivero v. American Federation of State, County and Municipal Employees, AFL-CIO (2003) 105 Cal.App.4th 913, 919.) In making both determinations, the trial court is to 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); Equilon Enterprises, LLC v. Consumer Cause, Inc. (2002) 29 Cal.4th 53, 67.)  

To satisfy the first prong of the two-prong test, the defendant’s acts underlying the cause of action must themselves have been in furtherance of the right of petition or free speech. (City of Cotati v. Cashman (2002) 29 Cal. 4th 69, 76-78.) The defendant’s acts are protected activity – that is, made in furtherance of protected rights to petition or for free speech in connection with a public issue – if they fit into one of the following categories under the section 425.16(e): (1) oral or written statements made before a legislative, executive, judicial or any other official proceeding; (2) oral or written statements made in connection with an issue under consideration or review by a legislative, executive, judicial body, or any other official proceeding authorized by law; (3) written or oral statements made in a place open to the public or in a public forum in connection with an issue of public interest; and (4) any other conduct in furtherance of the exercise of the constitutional rights of petition or free speech in connection with a public issue or an issue of public interest. (Code Civ. Proc. § 425.16(e); City of Cotati, supra, 29 Cal.4th at 78; Equilon Enterprises, supra, 29 Cal.4th at 67.)   

In determining whether a cause of action is based on protected activity, we “examine the¿principal thrust¿or¿gravamen¿of a plaintiff's cause of action to determine whether the anti-SLAPP statute applies.” (Optional Capital, Inc. v. Akin Gump Strauss, Hauer & Feld LLP¿(2017) 18 Cal.App.5th 95, 110, citation omitted.) “We assess the principal thrust by identifying ‘[t]he allegedly wrongful and injury-producing¿conduct¿... that provides the foundation for the claim.’” (Id. at 111, bold emphasis added, citation omitted.) In other words, section 425.16 does not apply if Defendant’s constitutionally protected activity is “merely incidental” or “collateral” to the unprotected activity. (Baral v. Schnitt (2016) 1 Cal.5th 376, 395.) “Allegations of protected activity that merely provide context, without supporting a claim for recovery, cannot be stricken under the anti-SLAPP statute.”¿(Ibid.)  

Analysis

Defendants move to strike Plaintiff’s first cause of action for fraud in the inducement and third cause of action for breach of contract.

            Defendants contend that Plaintiff’s first cause of action for fraud in the inducement and third cause of action for breach of contract arise out of protected activity. Specifically, Defendants argue that Plaintiff’s first and third causes of action are rooted in Defendants’ Petition to Compel Arbitration, which was granted on September 15, 2022, in Case No. 22SMCP00239. Defendants do not cite a single allegation in the First Amended Complaint that alleges protected conduct as a basis for the claim. A cursory review of the First Amended Complaint reveals no allegations of any conduct pertaining to either an arbitration proceeding or the petition to compel arbitration. In fact, the most recent act alleged in the First Amended Complaint occurred on January 27, 2021. (FAC ¶¶ 20-22.) Instead, Defendants appear to argue that Plaintiff amended the Complaint in response to the outcome of the petition to compel arbitration, and that, as a result, Plaintiff’s amended claims are now based on protected conduct.

            The Court is entirely unpersuaded by Defendants’ argument. An amendment to a Complaint setting forth new facts or claims in response to actions taken by the opposing party in a legal proceeding is distinct from an amendment to the Complaint alleging a new basis for liability based on or caused by the opposing party’s actions in a legal proceeding. The latter is a claim based on protected activity. The former is basic legal strategy. Defendants have not met their burden to establish that the acts of which Defendants are accused in the Amended Complaint are protected activity.

            As Defendants have not met their burden to establish that the disputed causes of action are based on protected activity, the burden does not shift to Plaintiff to establish a probability of prevailing on their claims.

CONCLUSION:

Accordingly, Defendants’ special motion to strike is DENIED.  

Moving Parties to give notice.

IT IS SO ORDERED.

Dated: January 27, 2023                                 ___________________________________

                                                                                    Theresa M. Traber

                                                                                    Judge of the Superior Court

            Any party may submit on the tentative ruling by contacting the courtroom via email at Smcdept47@lacourt.org by no later than 4:00 p.m. the day before the hearing. All interested parties must be copied on the email. It should be noted that if you submit on a tentative ruling the court will still conduct a hearing if any party appears. By submitting on the tentative you have, in essence, waived your right to be present at the hearing, and you should be aware that the court may not adopt the tentative, and may issue an order which modifies the tentative ruling in whole or in part.