IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA THIRD APPELLATE DISTRICT (San Joaquin)
January 28, 2011
TERRY D. HAMILTON ET AL., PLAINTIFFS AND APPELLANTS,
HENRY W. WILLMS, INDIVIDUALLY AND AS COTRUSTEE, ETC., ET AL., DEFENDANTS AND RESPONDENTS.
(Super. Ct. No. 39-2008-00185771-CU-BC-STK)
The opinion of the court was delivered by: Butz ,j.
Hamilton v. Willms CA3
NOT TO BE PUBLISHED
California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.
Plaintiffs Terry D. Hamilton and Sharon M. Hamilton (the Hamiltons) and defendants Henry W. Willms and Dolly G. Willms, individually and as co-trustees (the Willmses), are parties to a lawsuit in federal district court. During pretrial discovery, counsel for the Hamiltons and the Willmses negotiated an agreement regarding the taking of an independent witness's deposition. Before the witness signed the agreement, the Willmses' attorney wrote a letter declining to go through with the witness's deposition. After unsuccessfully seeking sanctions in the federal court action, the Hamiltons filed a complaint against the Willmses in San Joaquin County Superior Court for breach of written contract, breach of the implied covenant of good faith and fair dealing, and promissory fraud.
The Willmses filed a motion to strike the complaint pursuant to California's "anti-SLAPP" statute (Code Civ. Proc., § 425.16).*fn1 The trial court granted the motion and the Hamiltons appeal. We shall affirm the judgment.
In June 2003, the Hamiltons sued the Willmses in federal district court in the Eastern District of California, asserting violations of RICO,*fn2 fraud, breach of contract, and theft (the district court action). (Hamilton v. Willms (E.D. Cal., No. CV F 02 6583 AWI SMS).) During the course of the district court action, the Hamiltons and the Willmses entered into a series of negotiations, stipulations, and agreements regarding discovery. One issue the Willmses and the Hamiltons negotiated was how and when an out-of-state witness, Suzanne Conry, was to be deposed.
The negotiations were reduced to a written agreement setting forth conditions for conducting Conry's deposition (the Conry agreement). Among other things, the agreement provided that the Hamiltons would pay the cost of Conry's travel, meals and lodging to facilitate taking her deposition in California. The Conry agreement was ultimately signed by the attorneys but not by Conry. Subsequently, the Willmses' attorney, Don J. Pool, sent a letter to the attorney for the Hamiltons (the Pool letter) stating that Henry Willms was "revok[ing] the agreement executed between the parties . . . relating to the conduct of Ms. Conry's deposition."
The Hamiltons filed a motion to compel and a request for sanctions in the district court action. The federal magistrate granted the motion to compel and reopened discovery to allow the parties to take Conry's deposition. However, she refused to consider sanctions based on an alleged breach of the Conry agreement, stating: "[Y]ou're going to have to sue him in another court on that, because that's not a contract that's within the four corners of the complaint in this case."
The Hamiltons filed a three-count complaint in this action. All three causes of action are based upon an alleged breach of the Conry agreement. The complaint claims the Pool letter constituted a repudiation of the Conry agreement and that the Hamiltons were damaged by incurring expenses associated with Conry's travel from Colorado to California.
The Willmses filed a special motion to strike the complaint pursuant to section 425.16, arguing that because "the causes of action alleged in plaintiffs' Complaint arise from acts . . . in furtherance of [the Willmses'] right of petition, and the rights of representation and free speech," and "fall squarely within California's absolute litigation privilege," the complaint falls within the scope of section 425.16, and the Hamiltons could not demonstrate a prima facie case of prevailing.
The trial court granted the Willmses' motion and dismissed the lawsuit. It found the Hamiltons' claims arose from issues litigated in the district court action and that the Conry agreement "was created in furtherance in the federal litigation as that term is defined in Code of Civil Procedure section 425.16[, subdivision] (e)."
I. Legal Principles
Section 425.16 was designed to eliminate, at an early stage of the proceedings, non-meritorious or retaliatory litigation "meant to chill the valid exercise of the constitutional rights of freedom of speech and petition in connection with a public issue. [Citation.] These meritless suits, referred to under the acronym SLAPP . . . are subject to a special motion to strike unless the person asserting that cause of action establishes by pleading and affidavit a probability that he or she will prevail." (Sipple v. Foundation for Nat. Progress (1999) 71 Cal.App.4th 226, 235; Seelig v. Infinity Broadcasting Corp. (2002) 97 Cal.App.4th 798, 806.)
A ruling on an anti-SLAPP motion requires a two-step process. The court first determines whether the defendant has made a threshold showing that the challenged cause of action is one arising from protected activity as defined in section 425.16, subdivisions (b)(1) and (e). If such a showing has been made, the court then determines whether the plaintiff has shown a probability of prevailing on his claim. (Equilon Enterprises v. Consumer Cause, Inc. (2002) 29 Cal.4th 53, 67 (Equilon).)
The trial court makes these determinations by considering "the pleadings, and supporting and opposing affidavits stating the facts upon which the liability or defense is based." (§ 425.16, subd. (b)(2); Equilon, supra, 29 Cal.4th at p. 67.) On appeal from an order granting or denying an anti-SLAPP motion, we review the trial court's determination de novo. (Sylmar Air Conditioning v. Pueblo Contracting Services, Inc. (2004) 122 Cal.App.4th 1049, 1056 (Sylmar).)
Code of Civil Procedure section 425.16 expressly defines SLAPP-protected activity to include any written statements made "before a . . . judicial proceeding" or "in connection with an issue under consideration or review by a . . . judicial body." (Code Civ. Proc., § 425.16, subd. (e).) In interpreting this subdivision, courts have held that statements that fall within the litigation privilege (Civ. Code, § 47, subd. (b)(2)), also constitute protected activity within the scope of Code of Civil Procedure section 425.16. (Briggs v. Eden Council for Hope & Opportunity (1999) 19 Cal.4th 1106, 1115 (Briggs); Sylmar, supra, 122 Cal.App.4th at p. 1058.) Protection is afforded under both provisions because "[t]o be privileged under [Civil Code] section 47, a statement must be 'reasonably relevant' to pending . . . litigation . . . " and "[t]he reasonable relevancy requirement of section 47 is analogous to the 'in connection with' standard of [Code of Civil Procedure] section 425.16, subdivision (e)(2)." (Neville v. Chudacoff (2008) 160 Cal.App.4th 1255, 1266.)
"Under the 'usual formulation,' the litigation 'privilege applies to any communication (1) made in the judicial or quasi-judicial proceedings; (2) by litigants or other participants authorized by law; (3) to achieve the objects of the litigation; and (4) that have some connection or logical relation to the action.'" (Sylmar, supra, 122 Cal.App.4th at p. 1058.) "Th[is] privilege extends to 'any publication . . . that is required [citation] or permitted [citation] by law in the course of a judicial proceeding to achieve the objects of the litigation, even though the publication is made outside the courtroom and no function of the court or its officers is invoked.'" (Kolar v. Donahue, McIntosh & Hammerton (2006) 145 Cal.App.4th 1532, 1540-1541, italics added.)
In Healy v. Tuscany Hills Landscape & Recreation Corp. (2006) 137 Cal.App.4th 1 (Healy), a homeowners association filed a complaint against association member Healy, alleging that she wrongfully denied the association access through her property. (Id. at p. 3.) The association sent a letter to all of its members informing them of the litigation. (Id. at p. 4.) The letter also suggested that, as a result of Healy's refusal to allow access, the association's landscape maintenance fees would be higher. (Ibid.) Healy filed a counterclaim in the main action, alleging the contents of the letter were defamatory. (Id. at pp. 3-4.)
The association filed a special motion to strike the counterclaim, asserting that the letter fell within the litigation privilege of Civil Code section 47, subdivision (b) because it was written in connection with a pending court action. (Healy, supra, 137 Cal.App.4th at p. 4.) The appellate court agreed. It held that the letter fell within the scope of the litigation privilege since it had "'some relation' to [the] judicial proceedings." (Id. at p. 6.) Moreover, because the "statements . . . come within the protection of the litigation privilege of Civil Code section 47, subdivision (b), [they] are equally entitled to the benefits of [Code of Civil Procedure] section 425.16." (Healy, at p. 5.)
Here, the statement at issue is the Pool letter, revoking an agreement with respect to Conry's deposition. As in Healy, although the Pool letter was not part of the papers or pleadings filed with the court, it clearly had "some relation" to pending judicial proceedings. The Pool letter was therefore cloaked with the litigation privilege of Civil Code section 47, subdivision (b) since: (1) the letter was made in the course of a judicial proceeding; (2) it was written by an attorney for a litigant; and (3) it was written pursuant to an object of that litigation, i.e., discovery in the pending district court action.
Since the Pool letter fell within the litigation privilege, the trial court correctly ruled that it was also afforded protection under section 425.16 as a "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." (Briggs, supra, 19 Cal.4th at pp. 1112-1113, citing § 425.16, subd. (e), italics added.)
The Hamiltons characterize this action as an ordinary breach of contract suit. They insist that under Navellier v. Sletten (2002) 29 Cal.4th 82, 92 (Navellier), to fall within section 425.16's protection, the action must be based either on a statement made before a court or judicial body or one made in connection with an issue under consideration or review by that body.
The Hamiltons' reading of Navellier is incorrect. Navellier states that acts protected under section 425.16 include any written or oral statement or writing made before a judicial proceeding and any written or oral statement or writing made in connection with an issue under consideration or review by a judicial body. (Navellier, supra, 29 Cal.4th at p. 88.) As the court later clarified, "[t]he anti-SLAPP statute's definitional focus is not the form of the plaintiff's cause of action but, rather, the defendant's activity that gives rise to his or her asserted liability--and whether that activity constitutes protected speech or petitioning." (Id. at p. 92.) Here, the activity that forms the gravamen of the Hamiltons' lawsuit is the Pool letter, which constituted an alleged breach of the Conry agreement. Unquestionably, that letter arises from discovery issues connected to the district court action.
The Hamiltons also cite the magistrate's comments at the hearing on the motion for sanctions ("[Y]ou're going to have to sue him in another court") as conclusive proof that the Conry agreement was unconnected to any issue before a judicial body. However, the magistrate's refusal to award sanctions or even consider them cannot change the fact that the Pool letter had "some relation" to an issue pending before the district court, and thus constituted a writing "in connection" with an issue before a judicial body. (Healy, supra, 137 Cal.App.4th at p. 6, italics added; Civ. Code, § 47, subd. (b)(2); Code Civ. Proc., § 425.16, subd. (e)(2).) It therefore fell squarely within the ambit of California's anti-SLAPP legislation.
The second step in ruling on a special motion to strike is to determine whether the plaintiffs have demonstrated a probability of prevailing in the suit. (Equilon, supra, 29 Cal.4th at p. 67.) However, the Hamiltons do not argue that they would have prevailed in their lawsuit against the Willmses. We are therefore compelled to uphold the trial court's implied finding that they were unable to demonstrate a prima facie case.
The judgment is affirmed. The Willmses are awarded their costs on appeal. (Cal. Rules of Court, rule 8.278(1), (2).)
BLEASE , Acting P.J.