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Hudson Martin Ferrante Street Witten & DeMaria, PC v. Forsythe

United States District Court, N.D. California, San Jose Division

April 7, 2017

HUDSON MARTIN FERRANTE STREET WITTEN & DEMARIA, PC, Plaintiff,
v.
DAVID ALAN FORSYTHE, Defendant.

          ORDER DENYING DEFENDANT'S SPECIAL MOTION TO STRIKE COMPLAINT; AND DENYING PLAINTIFF'S REQUEST FOR ATTORNEYS' FEES [RE: ECF 8]

          BETH LABSON FREEMAN United States District Judge.

         Plaintiff Hudson Martin Ferrante Street Witten & Demaria, PC (“Hudson Martin” or “the firm”) claims that Defendant David Alan Forsythe (“Forsythe”) unlawfully accessed and used information stored on the firm's computers in order to gain an advantage in his divorce from the firm's managing partner, non-party Jeannette Witten (“Witten”). Forsythe has filed a special motion to strike the complaint under California Code of Civil Procedure § 425.16. Hudson Martin opposes the motion and requests that the Court award it statutory attorneys' fees on the basis that the motion is frivolous. Both the motion and the request for attorneys' fees are DENIED for the reasons discussed below.

         I. BACKGROUND

         Hudson Martin filed the complaint in this action on November 10, 2016, alleging the following facts. The firm is one of the oldest and most prestigious law firms in Monterey, California. Compl. ¶ 7, ECF 1. The firm's managing partner, Witten, married Defendant Forsythe in 2006. Id. ¶ 8. Forsythe is a computer programmer and network integration specialist who works from home as an outside contractor for pharmaceutical companies. Id. ¶ 9. Beginning in 2014, Forsythe began performing occasional IT services for Hudson Martin in exchange for use of office space at the firm. Id. ¶ 10.

         On March 16, 2015, Witten filed a divorce petition to commence what have become “[b]itter divorce proceedings.” Compl. ¶ 11. In June 2015, Hudson Martin revoked Forsythe's office privileges and changed the firm's locks to ensure that Forsythe would not have access. Id. ¶ 12. Shortly thereafter, on June 27, 2015, an unknown individual accessed the firm's account at Wells Fargo Bank from a location outside of the firm. Id. ¶ 13. Hudson Martin immediately changed all of its financial passwords and user names, but an unknown user continued to access the Wells Fargo account. Id. ¶ 15. On July 24, 2015, Wells Fargo prohibited the firm from accessing its accounts online and suggested that the firm might be a victim of spyware. Id.

         In August 2015, Hudson Martin discovered that an unknown individual had accessed the firm's servers remotely and, in particular, had accessed Witten's personal email correspondence regarding her divorce proceedings. Compl. ¶ 16. Hudson Martin immediately changed all of its firm passwords, after which there were dozens of failed login attempts. Id. ¶ 17. Hudson Martin had IT professionals search all its computers, which resulted in discovery of spyware on computer workstations at the firm and on Witten's laptop computer which she used both at the firm and at home. Id. ¶ 18. The search also revealed that a remote login program had been installed on Witten's laptop without her permission or knowledge. Id. ¶ 19. After the remote login program was removed from the laptop, the unauthorized login attempts to the firm's Wells Fargo account stopped. Id. ¶ 20.

         In October 2016, Forsythe produced documents to Witten in the divorce proceedings which included images of Hudson Martin checks. Compl. ¶ 24. Hudson Martin determined that the images were cropped screenshots taken from the firm's QuickBooks files. Id. The firm uses its QuickBook files as a client management system, and the files contain attorney-client protected material, including client lists; clients' contact information and financial information; and employees' contact information, social security numbers, paycheck information, and medical insurance information. Id. ¶ 22. Forsythe had attempted to obtain Hudson Martin's QuickBook files for use in the divorce proceedings by means of subpoena, but after Hudson Martin objected to production, Forsythe dropped the issue and did not move to compel production. Id. ¶¶ 21-23. At no time was any Hudson Martin employee, or non-employee such as Forsythe, authorized to copy or remove the firm's QuickBook files from the firm's secure, firewalled server. Id. ¶ 25. Forsythe's divorce attorney thereafter stated that Forsythe had copied Hudson Martin's QuickBook files to his personal computer and that both Forsythe and his counsel were in possession of the QuickBook files. Id. ¶ 26.

         Hudson Martin believes that Forsythe was the individual who remotely accessed the firm's servers and the firm's Wells Fargo account. Compl. ¶¶ 29-13. The firm also believes that Forsythe used that access to view Witten's email correspondence with her divorce attorney. Id. Hudson Martin sues Forsythe for: (1) violation of the federal Computer Fraud and Abuse Act, 18 U.S.C. § 1030 et seq.; (2) violation of California's Comprehensive Computer Data Access and Fraud Act, California Penal Code § 502; and (3) conversion.

         Forsythe asserts that Hudson Martin's suit is a strategic lawsuit against public participation (“SLAPP”), and he brings a special motion to strike the complaint under California's anti-SLAPP statute, California Code of Civil Procedure § 425.16. Hudson Martin opposes the motion and seeks attorneys' fees under a subsection of § 425.16 which provides for an award of fees where the special motion to strike is frivolous.

         II.LEGAL STANDARD

         “Under California's anti-SLAPP statute, a defendant may bring a special motion to strike a cause of action arising from constitutionally protected speech or petitioning activity.” Barry v. State Bar of California, 2 Cal. 5th 318, 320 (2017) (citing Cal. Civ. P. Code § 425.16(b)(1)). A defendant in federal court may bring an anti-SLAPP motion with respect to California state law claims asserted under either diversity jurisdiction or supplemental jurisdiction. Jen v. City & Cty. of San Francisco, No. 15-CV-03834-HSG, 2016 WL 3669985, at *11 (N.D. Cal. July 11, 2016). The anti-SLAPP statute does not apply to claims asserted under federal law. Hilton v. Hallmark Cards, 599 F.3d 894, 901 (9th Cir. 2010).

         “The analysis of an anti-SLAPP motion proceeds in two steps: First, the court decides whether the defendant has made a threshold showing that the challenged cause of action is one arising from protected activity.” Barry, 2 Cal. 5th at 321 (internal quotation marks and citations omitted). When a claim is mixed, meaning that it is based on allegations of both protected and unprotected activity, the unprotected activity is disregarded at the first step. Baral v. Schnitt, 1 Cal. 5th 376');">1 Cal. 5th 376, 396 (2016).

         “If the court determines that relief is sought based on allegations arising from activity protected by the statute, the second step is reached.” Baral, 1 Cal. 5th at 396. “There, the burden shifts to the plaintiff to demonstrate that each challenged claim based on protected activity is legally sufficient and factually substantiated.” Id. “The court, without resolving evidentiary conflicts, must determine whether the plaintiff's showing, if accepted by the trier of fact, would be sufficient to sustain a favorable judgment.” Id. “[T]hough the court does not weigh the credibility or comparative probative strength of competing evidence, it should grant the motion if, as a matter of law, the defendant's evidence supporting the motion defeats the plaintiff's attempt to establish evidentiary support for the claim.” Hilton, 599 F.3d at 903 (internal quotation marks and citations omitted) (brackets in original). If the plaintiff fails to meet its burden at the second step, the claim based on protected activity is stricken and “[a]llegations of protected activity supporting the stricken claim are eliminated from the complaint, unless they also support a distinct claim on which the plaintiff has shown a probability of prevailing.” Baral, 1 Cal. 5th at 396.

         III. ...


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