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Southern California Gas Co. v. Flannery

California Court of Appeals, Second District, Fifth Division

December 16, 2014

SOUTHERN CALIFORNIA GAS COMPANY, Plaintiff and Respondent,
v.
PATRICK FLANNERY, Defendant and Appellant.

APPEAL from the orders of the Superior Court of Los Angeles No. BC442504, John S. Wiley, Jr., Judge.

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COUNSEL

Daneshrad Law Firm, Joseph Daneshrad; Benedon & Serlin, Gerald M. Serlin and Kelly R. Horowitz, for Defendant and Appellant.

Sheppard Mullin Richter & Hampton, Steven O. Kramer, John A. Yacovelle, Jonathan D. Moss, Marisa B. Miller; and Marlin E. Howes, for Plaintiff and Respondent.

OPINION

KRIEGLER, J.

Plaintiff and respondent Southern California Gas Company (SCGC) filed a complaint in interpleader against defendant and appellant Patrick Flannery and his former attorney. SCGC filed a motion for discharge from the interpleader action and an award of attorney fees under Code of Civil Procedure section 386.6[1] (the “Discharge Motion”) and Flannery filed a special motion to strike under section 425.16 (the “Anti-SLAPP Motion”). The court granted the Discharge Motion and denied the Anti-SLAPP Motion. Flannery appeals both orders.

Flannery contends the court erroneously concluded (1) section 425.16 (the anti-SLAPP statute) does not apply to interpleader complaints, (2) the interpleader complaint did not arise from protected activity, and (3) SCGC demonstrated a probability of prevailing on its interpleader complaint. We affirm the court’s order denying Flannery’s Anti-SLAPP Motion on the grounds that SCGC met its burden of showing a probability it would prevail on the merits of its interpleader action.

Flannery also contends the court erroneously granted SCGC’s Discharge Motion because (1) his due process rights were violated, (2) there is no statutory basis for the Discharge Motion, and (3) the court’s attorney fee award is not supported by substantial evidence. We reject each contention and affirm the order granting the Discharge Motion.

FACTUAL AND PROCEDURAL BACKGROUND

On March 15, 2013, SCGC filed a complaint in interpleader (the “Interpleader Action”) and deposited an unspecified amount with the clerk of the court. To place the Interpleader Action in context, we review the procedural history of related cases involving Flannery, his ex-girlfriend Andrea Murray, and his former attorney Scott Tepper.

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In 2009, Flannery and Murray sued SCGC for damages suffered as a consequence of the 2008 Sesnon wildfire. The case (the “Sesnon Fire Case”) was consolidated with other cases stemming from the wildfire (the “In re Sesnon Fire Cases”). Flannery and Murray were jointly represented by Tepper until attorney Dennis Ardi substituted in as Murray’s counsel in the fall of 2010. Tepper continued to represent Flannery until June 2012, when attorney Joseph Daneshrad substituted in as Flannery’s counsel. On June 22, 2012, Tepper filed a notice of lien against any recovery in the Sesnon Fire Case.

On February 26, 2013, Flannery, Murray, and SCGC settled the Sesnon Fire Case, and the parties’ settlement was approved by the trial court. The agreement required SCGC to pay confidential but specific monetary amounts (the “Settlement Funds”) to (1) Flannery and his counsel, (2) Murray and her counsel, and (3) an attorney whose role is not relevant to our facts. The agreement required SCGC to pay the Settlement Funds before March 19, 2013.

On February 27, 2013, one day after the parties had settled, Tepper sent an e-mail to all counsel in the Sesnon Fire Case advising them that he was “entitled to know the amount of the settlement[, asserted] a lien equal to 33 1/3% of the settlement proceeds” and requested “assurances that my lien will be protected....” He further advised that if he was not given the requested assurances, he would “apply to the court for an order requiring my lien to be protected and honored, and take such additional steps as may be necessary to enforce my lien.”

On March 6, 2013, counsel for SCGC advised Daneshrad and Tepper that in order to protect SCGC from the dispute over attorney fees, it intended to interplead the Settlement Funds unless it received “written directions signed by both of you and Mr. Flannery.” By March 13, 2013, Daneshrad and Tepper had been unable to reach agreement. In a final attempt to resolve the dispute, SCGC proposed three alternatives, conditioning the first two on obtaining agreement from both Tepper and Daneshrad (1) one check made out to Flannery, Daneshrad and Tepper, (2) one check for 2/3 of the Settlement Funds made out to Flannery and Daneshrad and one check for 1/3 of the Settlement Funds made out to Flannery, Daneshrad, and Tepper, or (3) interplead the Settlement Funds. Rather than reaching an agreement, both attorneys began taking opposing stances on whether Murray also had a claim to the Settlement Funds.[2] Unable to obtain agreement from Tepper and Daneshrad, SCGC filed the Interpleader Action on March 15, 2013, identifying Tepper, Daneshrad, and Flannery as defendants and claimants, and

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deposited the Settlement Funds with the court. On March 21, 2013, SCGC filed an amendment adding Murray as a Doe defendant.[3]

On March 20, 2013, once the deadline for SCGC to pay the Settlement Funds had expired, Flannery filed an ex parte motion in the Sesnon Fire Case to enforce the settlement agreement. The court ordered the parties to file an application to seal the ex parte motion and continued the matter to March 25, 2013.

On March 25, 2013, with counsel for Flannery and SCGC appearing, the court continued Flannery’s ex parte motion to enforce the settlement agreement to April 10, 2013, and ordered the papers supporting the ex parte motion to be returned to the parties “for safekeeping pending further hearing on ex parte, without refilling [sic] of papers.” At the same hearing, the court deemed the Interpleader Action related to the In Re Sesnon Fire Cases. The court ordered the parties to participate in a mandatory settlement ...


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