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Club Members for an Honest Election v. Sierra Club

December 15, 2008

CLUB MEMBERS FOR AN HONEST ELECTION, PLAINTIFF AND APPELLANT,
v.
SIERRA CLUB, ET AL., DEFENDANTS AND APPELLANTS.



Ct.App. 1/1 A110069, San Francisco County, Super. Ct. No. 04-429277, Judge: James L. Warren.

The opinion of the court was delivered by: Corrigan, J.

Code of Civil Procedure section 425.16,*fn1 commonly referred to as the anti-SLAPP statute,*fn2 provides that a civil cause of action may be dismissed as a strategic lawsuit against public participation (SLAPP). Section 425.17, subdivision (b) (section 425.17(b)) provides an exception to the anti-SLAPP statute by exempting some actions from dismissal. Here, we hold the exception applies only when the entire action is brought in the public interest. If any part of the complaint seeks relief to directly benefit the plaintiff, by securing relief greater than or different from that sought on behalf of the general public, the section 425.17(b) exception does not apply.

Accordingly, we reverse a contrary judgment by the Court of Appeal. However, we affirm that part of the judgment holding that the trial court properly struck parts of the complaint under the anti-SLAPP statute because its order established that plaintiffs did not show a probability of prevailing.

FACTS AND PROCEDURAL BACKGROUND*fn3

The Sierra Club (Club), the nation's largest environmental organization, is governed by a 15-member board of directors (Board), who are elected for three-year staggered terms. The Club holds elections for five directors each year. A nominating committee chooses a slate of candidates, but other candidates may be nominated by member petition.

While total Club membership exceeds 700,000, member participation in annual elections is generally low.*fn4 As a result, the vote of a small number of members may disproportionately influence the outcome. In 2003, there was a rift among the Board members. A majority favored current policies, while a minority sought to take the Club in a different direction. Ballots for the 2004 election were to be mailed in February. On January 30, 2004, in response to a perceived threat posed by candidates favoring the minority view, the Board held a meeting and took the actions that led to this litigation.

First, the Board voted to disseminate an article to all chapter newsletters. Written by Drusha Mayhue, it cautioned that low member participation in elections made the Club vulnerable to takeover efforts by those whose agenda differed from that of the majority.

Second, the Board also directed that an "urgent election notice" be attached to the front of voting materials. The notice warned of "an unprecedented level of outside involvement and attention" to the Club's election and named a number of outside groups that "may be attempting to intervene" in the election. Though the notice itself did not refer to specific candidates, ballot materials included statements of three candidates who disclaimed any personal interest in being elected. Instead, those three candidates' statements urged members to vote for the Club's nominating committee slate or against candidates supported by outside groups.*fn5

Plaintiff and candidate Robert van de Hoek, and a group supporting him, Club Members for an Honest Election (CMHE), objected to the Club's distribution of this material and sought injunctive relief. As amended, the complaint alleged that the Club had distributed information supporting some candidates and opposing others. It also alleged that candidates opposed by the Club were not given an opportunity to present contrasting views and challenged the inclusion of statements by "three fake Board candidates." The Club defeated plaintiffs' requests for temporary and preliminary restraining orders. Using the anti-SLAPP statute, it successfully urged the court to strike a portion of the complaint seeking to enjoin or censor future speech. Plaintiffs did not appeal the order to strike. The election went forward; van de Hoek was not among those elected to the Board.

Several months after the election, van de Hoek and CMHE filed a second amended complaint against the Club and added six individual directors as defendants. The complaint alleged four causes of action: (1) a challenge to the validity of the election under Corporations Code section 5617; (2) a petition for declaratory relief; (3) breach of fiduciary duty; and (4) violation of Business and Professions Code section 17200. The third cause of action was aimed, in part, at directors Nick Aumen and Jan O'Connell, who ran successfully on the nominating committee slate. It alleged that they breached their fiduciary duty by voting for the Board actions taken at the January 30, 2004 meeting. The complaint sought extensive injunctive relief, including the removal of five elected or appointed Board members and the installation of van de Hoek and four other unsuccessful candidates. It sought both to bar those removed directors from running for the Board in the 2005 election and to bar Aumen and O'Connell from ever running for the Board again.

Again relying on the anti-SLAPP statute, the Club moved to strike the second amended complaint. The parties also filed competing motions for summary judgment. With regard to the anti-SLAPP motion, the court held that voting as a director is protected under the First Amendment to the United States Constitution (First Amendment.) Thus, it struck the third cause of action alleging that the votes of Aumen and O'Connell breached a fiduciary duty. It also struck a paragraph of the first cause of action that referred to the votes of the directors. The balance of the motion to strike was denied. The court went on to deny plaintiffs' motion for summary judgment and to grant that of the defendants. The complaint was then dismissed in its entirety. In connection with the Club's partially successful anti-SLAPP motions, the court awarded fees and costs in the amount of $37,010.76.

Plaintiff van de Hoek did not appeal. CMHE did not challenge the summary judgment rulings, but did appeal the anti-SLAPP rulings and related fee and cost awards. The Club cross-appealed from the partial denial of the motion to strike, arguing that the entire complaint arose from defendants' protected activities.

The Court of Appeal held that plaintiffs' breach of fiduciary duty cause of action arose from protected First Amendment activity, and was thus subject to the Club's motion to strike.

The Court of Appeal also held that certain causes of action fell under section 425.17(b), the public interest exception to the anti-SLAPP statute, and that those particular causes of action should not have been struck. The Court of Appeal concluded that the first, second and fourth causes of action were exempt from the anti-SLAPP statute under the public interest exception. Because CMHE challenged the Club's election procedures on the ground that they constituted an unfair manipulation of an election to defeat candidates advancing views at odds with those of the existing board of directors, the Court of Appeal held that the "principal thrust or gravamen" of these causes of action were consistent with a public interest action. The Court of Appeal relied in large measure on case law interpreting section 1021.5, the private attorney general statute, which awards attorney fees to a party whose action has resulted in the enforcement of an important right affecting the public interest. By analogy, the Court of Appeal concluded that, even when a plaintiff has a personal stake in a ...


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