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Old Republic Construction Program Group v. The Boccardo Law Firm, Inc.

California Court of Appeals, Sixth District

October 21, 2014

THE BOCCARDO LAW FIRM, INC. Defendant and Appellant.

Santa Clara County Superior Court, No. CV203288 The Honorable Peter H. Kirwan

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[Copyrighted Material Omitted]

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The Boccardo Law Firm Inc. The Boccardo Law Firm Inc., John C. Stein, Linda S. Votaw, Attorneys for Defendant and Appellant.

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Old Republic Construction Program Group Branson, Brinkop, Griffith & Strong Kenneth W. Sandall, Branson, Brinkip, Griffith & Campo, Kenneth W. Sandall Attorneys for Plaintiff and Respondent.



Defendants The Boccardo Law Firm, Inc. (Boccardo) and one of its partners, John C. Stein, bring this appeal from an order denying their motion under the anti-SLAPP law (Code Civ. Proc., § 425.16 (§ 425.16)), to strike three causes of action asserted against them by plaintiff Old Republic Construction Program Group (Old Republic). The question presented is whether the statute applies to claims alleging that defendants wrongfully withdrew settlement funds derived from a now-defunct lawsuit, which they had deposited in their trust account pursuant to a stipulation requiring Old Republic’s consent to any withdrawal. In answering this question we apply two principles that have perhaps not been as clearly articulated in the case law as they should be: (1) in determining whether a cause of action arises from conduct protected by the anti-SLAPP law, the focus is on the wrongful, injurious acts or omissions identified in the complaint, and whether those acts or omissions come within the statute’s description of protected conduct; and (2) unless the wrongful conduct is communicative in character, it is protected by the statute only if it was undertaken in connection with an issue of public importance. Because the withdrawal of funds underlying the causes of action at issue was neither communicative nor related to an issue of public interest, the trial court properly denied a motion to dismiss those causes of action. We will therefore affirm the order.


A. The Carabello Action

Defendants Boccardo and Stein filed an action for damages in San Joaquin Superior Court on behalf of Albert Carabello, alleging that he had been injured when his pickup collided with a vehicle operated by Beverly Casby, the defendant in that action.[1] Casby was insured under a policy of automobile insurance with liability coverage of $100, 000.

It is apparently undisputed that at the time of the collision, Carabello was acting in the course and scope of his employment. Plaintiff Old Republic was the workers’ compensation insurer for Carabello’s employer. It provided

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benefits which it claims exceeded $100, 000. It filed a complaint in intervention in the San Joaquin action, asserting a right to reimbursement of these expenditures.

In answer to both Carabello’s and Old Republic’s complaints, Casby raised the affirmative defense of Witt v. Jackson (1961) 57 Cal.2d 57 [17 Cal.Rptr. 369, 366 P.2d 641], which limits the ability of an employer, or its insurer, to obtain reimbursement out of an injured worker’s recovery against a third party where the employer’s own negligence contributed to the worker’s injuries. (See 2 Witkin, Summary of Cal. Law (10th ed. 2005) Workers Compensation, § 92, pp. 653-655; Levels v. Growers Ammonia Supply Co. (1975) 48 Cal.App.3d 443 [121 Cal.Rptr. 779].)

Carabello and Casby agreed to settle the case for her $100, 000 policy limits. Old Republic’s claim to reimbursement, however, remained unresolved. Accordingly, Casby’s insurer made the settlement check payable to Carabello, Boccardo, and Old Republic. Stein and counsel for Old Republic therefore signed a written stipulation stating “that the $100,000.00 settlement money... will be deposited into an interest bearing account” and that “[s]ignatures of both parties will be required to withdraw any money.” It was apparently understood that the funds would be placed in defendants’ client trust account. The settlement check was duly endorsed and deposited.

On December 14, 2009—the same day he signed the stipulation—counsel for Old Republic filed a motion “for apportionment of settlement proceeds, ” to be heard on January 10, 2010. The motion asserted an entitlement to the entire settlement fund, but did not mention the issue of employer negligence. Stein later asserted that he objected to the motion at a December 18 case management conference, arguing that it “was not well taken because, as part of the settlement agreement, we had agreed to litigate against the Intervener and fully assert Witt v. Jackson[, supra,] 57 Cal.2d 57, as a defense to their lien.” According to him, the court set August 9, 2010, for a “[t]rial of that matter, ” to be preceded by a mandatory settlement conference on July 6, 2010.

After the December conference, Old Republic withdrew its motion for apportionment. About a month later, on January 19, 2010, counsel for Old Republic filed a notice of lien seeking to recover $111,026.33 “against any settlement of [sic] judgment in this action.” At the same time, counsel filed a request to dismiss Old Republic’s complaint in intervention with prejudice. The record contains no explanation for this action. Nor does it show that Old Republic notified Boccardo or Stein of the dismissal. About three weeks later, Stein dismissed the Carabello complaint with prejudice. The request recited that it was made “[a]s to defendants Beverly Casby and Gerald Casby only”

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and that “Plaintiff and Intervenor have Trial August 9, 2010 to resolve liens.” However, the dismissal of the complaint meant that there was no longer any pleading before the court seeking affirmative relief.

The trial court apparently conducted a settlement conference on July 6, 2010. Stein later asserted that it was during this conference, or shortly before it, that he became aware of Old Republic’s dismissal of the complaint in intervention. Upon learning of it, he sought a hearing on shortened time for a motion authorizing release of the settlement funds to Carabello. He argued that by dismissing its pleading, Old Republic had forfeited any right to litigate the issue of employer negligence, and thus to recover on its lien. The trial court, however, concluded that the dismissal of all affirmative pleadings had deprived it of any power to grant the requested relief. In a formal order the court wrote, “This case has been dismissed in its entirety. This Court has no further jurisdiction.” It does not appear that either party sought relief from this order.

On July 9, 2010, Stein wrote to counsel for Old Republic indicating that he intended to distribute the deposited funds.[2] He again asserted that by dismissing its complaint Old Republic had given up the right to seek reimbursement. He took issue with a prior assertion by opposing counsel “that the matter can be litigated before the WCAB [(Workers’ Compensation Appeals Board)].” He offered to forbear from withdrawal for one week to “give you time to go to the WCAB and get a Restraining Order prohibiting me from disbursing my settlement.” Old Republic apparently did nothing. On July 28, Stein wrote that having just received the court’s formal order disclaiming the power to grant relief, he was disbursing the funds to his client forthwith.

B. The Workers’ Compensation Board Petition

On September 14, 2010, Old Republic petitioned the WCAB (Workers' Compensation Appeals Board) to order disbursement of the settlement proceeds. Stein filed a trial brief in which he conceded that the WCAB had jurisdiction to determine Old Republic’s entitlement to credit against future benefits. He argued, however, that the superior court had exclusive jurisdiction to determine the Witt v. Jackson issues as they might affect the existing settlement proceeds, and that ...

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