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SLAPP011 – Six Tips to Win Your Motion for Attorney Fees Following an Anti-SLAPP Motion
In Episode 11 of the California SLAPP Law Podcast, I provide you with six tips to win your attorney fee motions following a successful anti-SLAPP motion.
There are so many unscrupulous attorneys who inflate their fee applications, that some judges feel the need to reduce the fees requested on any motion for attorney fees. To make sure you don’t get lumped in with the other attorneys, here are the ways to show the judge that every dollar is justified.
In other news, I bring you up to speed on Demetriades v. Yelp, which was discussed in Episode 10. Demetriades is suing Yelp to enjoin it from falsely advertising that its reviews are trustworthy. Yelp brought an unsuccessful anti-SLAPP motion, and even though the Court of Appeal held that the anti-SLAPP motion should be denied, Yelp is not going quietly into the night. It is seeking review by the Supremes.
Finally, we discuss a very entertaining case at Morris & Stone. As discussed in Episode 9, a company filed a bogus lawsuit against our client in an attempt to prevent him from competing. We responded with an anti-SLAPP motion, which stayed all discovery. The plaintiff is not pleased, since it wanted to use discovery to harass our client. I predicted that it also would not go quietly into the night, and that it would seek relief from the discovery stay. You’ll hear the arguments plaintiff’s counsel (unsuccessfully) made as to why the discovery stay does not apply to them. I’ll show you how I defeated their ex parte application as well.
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Posted in Yelp Asks California High Court to Slap Down Restaurateur’s Suit Over Review Filter | Thomson Reuters Blog
Yelp’s statements to consumers about the accuracy of its review-filter software are protected speech, the website operator has told the California Supreme Court.
In an Aug. 28 petition for review, Yelp urges the high court to overturn a recent appeals court decision allowing restaurateur James Demetriades to proceed with his false-advertising suit against the site. The company says the state’s anti-SLAPP statute protects Yelp’s statements about the review filter.
Source: Thomson Reuters
I discussed this case at length in the 10th episode of the California SLAPP Law Podcast. The tables have been turned on Yelp. After suing one law firm for alleged fake reviews, this plaintiff is suing Yelp for fake reviews about itself. Yelp claims that its reviews are trustworthy, despite all evidence to the contrary.
Nonetheless, it pursued an anti-SLAPP motion against this claim for false advertising, and lost. It is now appealing that loss to the California Supreme Court.
Michael Mann Brief Lays Out Climate Change Defamation Theory – Climate Science Watch
In a brief filed today in the DC Court of Appeals as part of his defamation lawsuit against the National Review and the Competitive Enterprise Institute, Michael Mann once again argued his case and requested that the Court proceed to adjudicate the merits of Defendants’ appeal of the trial court’s denial of their motion to dismiss. The stated intention of Dr. Mann’s request is to expedite moving to trial on a case that has been long-delayed in procedural tangles.
Source: www.climatesciencewatch.org
This climate change defamation case has been an interesting one to follow. It was falsely assumed by many that the suit would not survive an anti-SLAPP motion because it is based on a dispute over global warming, and that is a hotly-debated issue. However, the anti-SLAPP motion failed because the defamation arises from the claim that the research was conducted fraudulently. That is an allegation that can be proven true or false, and therefore is not opinion.
See on Scoop.it – California SLAPP Law
The Weirdest Story About a Conservative Obsession, a Convicted Bomber, and Taylor Swift You Have Ever Read
Benghazi, Robin Williams, Islam, Twitter, and a convicted bomber from the 1970s came together in a court case against right-wing bloggers.
Source: www.thedailybeast.com
A very entertaining story about a guy who likes to sue, illustrating why a federal anti-SLAPP law might not be a bad idea.
See on Scoop.it – California SLAPP Law
Dance Moms Lawyers Slam Kelly Hyland Lawsuit, File Motion to Dismiss
If you watch Dance Moms online, you know Kelly Hyland is suing the show and its main star, Lee Miller, the dance studio shot-caller and show matriarch.
L.A. Superior Court Judge Ruth Kwan stated she was inclined to toss out Hyland’s claim that Miller defamed her in the aftermath of an episode last year.
Defense attorneys filed a motion to dismiss the case under California’s anti-SLAPP law protecting free speech. But attorneys representing Hyland argued otherwise.
They claim their clients were not properly compensated and that the contract between them and the series was unfairly slanted in favor of the production company.
Attorney Kelli Sager, on behalf of Collins, said Hyland was paid for every episode on which she appeared, and that simply, “is the deal she signed.”
“She’s just unhappy she was not on every week,” Sager said.
Source: www.thehollywoodgossip.com
I do get really tired of the the, “I didn’t understand what I was signing” defense, which is the argument being made by Hyland in this case. For example, I have received a number of calls over the years from contestants on American Idol, wanting to sue because the show made them look foolish, after signing an agreement with the show that they would not sue for being made to look foolish.
Nonetheless, the case is interesting in the anti-SLAPP context because it is outside the normal analysis of protected speech. By that I mean, when I prevail on an anti-SLAPP motion, it is often because the speech was subject to, say, the litigation privilege. It is because of that privilege that the plaintiff cannot make the requisite showing that he, she or it is likely to prevail.
Here, the reason the plaintiff can’t prevail is simply because the contract prohibits it. No fancy privilege, just basic contract law.
Latham Sued For Malicious Prosecution
Yesterday, a California appellate court overturned the lower court’s dismissal of a malicious prosecution claim against Biglaw mainstay Latham & Watkins. According to the opinion, the lower court was wrong on the statute of limitations, but the opinion also went out of its way to express just how likely the plaintiffs were to prevail on the merits of their claim that Latham doggedly pursued them on a “non-viable” legal theory.
Latham still has an opportunity to defend itself, but the language of this opinion is certainly not encouraging.
The plaintiff already recovered over $1.6 million in fees from Latham’s client, let’s see how they do against the firm…
Source: abovethelaw.com
Shame on the Latham & Watkins law firm.
I have proposed a law akin to the anti-SLAPP statute, which would apply to companies who seek to prevent former employees from creating competing businesses, and this case illustrates why.
The anti-SLAPP statute was passed because companies and individuals would use the time and expense of litigation as a means to silence criticism. If someone is saying something you don’t like, just sue them. The critic is then faced with the prospect of spending tens of thousands of dollars on a defense, or just ceasing the criticism.
In the case of employees who leave a company to start a competing business, the business brings suit claiming the use of “trade secrets,” and ties the former employees up in years of litigation; all the time knowing that the trade secrets do not exist and are certainly not being used. Sound familiar?
The Uniform Trade Secrets Act (UTSA) affords some protection to employees in this position, since it provides for the award of attorney fees to the employees if they prevail in the action, and the court determines that the action was brought in bad faith. But that does little to prevent the misuse of trade secret claims by companies wanting to stifle competition, since they can often bankrupt the former employees and force them to capitulate long before the employees can prevail in the action.
In this case, the plaintiff company brought in experts to testify that the former employees, no matter how good their intentions, had to be prevented from competing under the doctrine of “inevitable disclosure.” One problem, dear experts, inevitable disclosure is not a viable theory in California.
In any event, in this case the former employees beat the bogus suit, and were awarded $1.6 million in attorney fees against the company. They then brought a malicious prosecution action, and Latham & Watkins responded with an anti-SLAPP motion, arguing, inter alia, that the malicious prosecution action was barred by the statute of limitations. The trial court granted the anti-SLAPP motion on that basis.
[UPDATE 6/26/2015] On appeal, the Court of Appeal affirmed the trial court’s decision to grant the anti-SLAPP motion, but on a different basis. The Court of Appeal found that the trial court erred in concluding that the action was barred by the statute of limitations, but nonetheless affirmed the ruling on the basis of the “Interim Adverse Judgment Rule” (the Rule).
During the trial court proceedings, the employees had brought a motion for summary judgment. The trial court had denied the motion, finding that there were triable issues of fact. Under the Rule, if a dispositive motion is brought, and the action survives that motion, then it cannot be later said that the action was without merit. This is true even though the trial court later specifically found that the action had been brought in bad faith.
For this reason, the malicious prosecution action failed because an element of that claim is that the action was brought without probable cause, but if the claim survived a motion for summary judgment, that establishes that the action at least presented triable issues.
A malicious prosecution action in essence automatically falls under the anti-SLAPP statute, since it involves a party’s right of redress. The first prong is therefore met. Here, the burden then shifted to the employees to show that they were more likely than not to prevail on the malicious prosecution action, and they could not do so since the Rule established that the action was not brought without probable cause, regardless of the court’s later determination of bad faith.
There is logic to the Rule. When a party and its attorney are deciding whether to bring a legal action, they have a certain universe of information and documentation available. From that universe, they decide if there is probable cause for the action. If the action survives a motion for summary judgment, that means that the court agreed that the universe contained sufficient information in support of the action, since the court found triable issues.
The fact that the court later enters judgment in favor of defendants and even makes a determination of bad faith does not change that fact. Those determinations are made with the benefit of 20/20 hindsight, after all the evidence is presented, which is a different viewpoint than the plaintiff originally had when making the determination.
More Exciting Anti-SLAPP Victories at Morris & Stone
Today we follow up on a couple of our cases, which were reported on the California SLAPP Law Podcast, episodes 8 and 9, which led to anti-SLAPP victories.
The Case of the Evil Yogurt Maker
In Episode 8, I told the tale of the Evil Yogurt Maker. I changed the nature of the businesses involved so I could tell the story, and made the plaintiff a yogurt maker. My client had called him out on some false advertising claims, and the Evil Yogurt Maker responded by bringing a defamation action.
Our client was a sophisticated businessman who had really done his research. Before calling us, he already knew about the anti-SLAPP laws in general, and was familiar with Code of Civil Procedure section 425.17 in particular. That is the section that exempts certain business versus business actions from the anti-SLAPP statutes.
Our client had been advised by other attorneys that he could not respond to the defamation action with an anti-SLAPP motion, specifically because of section 425.17. We disagreed. Although this was a business versus business action, section 425.17 has a number of requirements before it applies, including the fact that the alleged “defamer” had to be directing its remarks to likely customers. Here, the remarks had been directed to regulatory agencies.
Upon the filing of the anti-SLAPP motion, the Plaintiff cried “Uncle!” and the case went away.
Using Discovery to Harass
This one involves a victory on the way to an anti-SLAPP victory. In Episode 9, and in this article, I discussed the case we are handling, wherein a company is attempting to use the litigation process to keep our client from competing. In typical fashion when a company is trying to thwart competition, the Plaintiff company filed an action, making the usual nonsensical claims that the defendant is using trade secrets. In these actions, the Plaintiff knows they will never prevail if the case goes to trial, but they attempt to make the process so expensive and burdensome that the defendant agrees to find another line of work. (Perhaps California next needs to pass legislation that applies an anti-SLAPP approach to actions designed to frustrate competition.)
In these sorts of actions, the Plaintiff’s two primary harassment tools are injunctions and discovery. Prior counsel in the action had already defeated Plaintiff’s attempt to obtain an injunction, so Plaintiff’s counsel was using discovery and threats of motions to compel to harass.
As a new form of harassment, Plaintiffs then amended their complaint to add four causes of action for defamation, and we responded with an anti-SLAPP motion, which stayed all discovery in the action.
I predicted that, contrary to all law, Plaintiff’s counsel would go to court and ask for leave to continue with discovery relating to the other causes of action and defendants. You see, section 425.16 specifically provides that a plaintiff can request leave from the stay in order to conduct discovery on issues related to the anti-SLAPP, but that discovery is very proscribed. It not only has to be related to the issues raised in the anti-SLAPP motion, it must go to specific defenses. Indeed, the defendant can eliminate the request for discovery by simply agreeing to waive whatever defense the plaintiff is requesting leave to conduct discovery on. Under no circumstances would a plaintiff be permitted to continue discovery on the other causes of action not related to the special motion to strike.
But that didn’t keep Plaintiffs from asking. One could say it never hurts to ask, I suppose, but isn’t there something to be said for intellectual integrity?
We received notice of an ex parte application, wherein Plaintiff’s counsel was seeking an earlier hearing date on a motion for relief from the discovery stay. Due to docket conditions, our anti-SLAPP motion won’t be heard until February 2015, and the first available date for the motion for relief from the discovery stay was March 2015. Since that is after the anti-SLAPP motion, it will be moot.
Here is how we opposed the motion for an earlier hearing date. We acknowledged that of course motions to shorten time should be liberally granted, but here the request was for a pointless motion. Plaintiff isn’t requesting leave to conduct necessary discovery related to the anti-SLAPP motion, which is the only discovery that is permitted following the filing of the motion. Here, Plaintiff specifically requested leave to conduct ONLY discovery NOT related to the anti-SLAPP motion. We therefore argued that the requested relief was pointless. This court’s docket is so backed up that it takes seven months to have a motion heard. Why give one of those precious motion slots to someone bringing a pointless motion?
The court apparently agreed. Motion DENIED.
SLAPP010 – Travolta and Yelp Anti-SLAPP Motions
In this week’s podcast, we look at two unsuccessful anti-SLAPP motions that were decided this week, and examine where the attorneys went wrong.
Yelp continues to get into mischief. In Episode 4 of the California SLAPP Law Podcast, we discussed the case of Yelp v. McMillan Law Group, wherein Yelp is suing a law firm, claiming that it posted fake reviews, and that Yelp was damaged as a result. McMillan Law Group filed an anti-SLAPP motion, and we are awaiting the results.
Now, in the case of Demetriades v. Yelp, the tables have been turned, and the plaintiff is essentially suing Yelp for its fake reviews about itself. Yelp tries to promote the notion that its reviews are filtered and trustworthy, despite all evidence to the contrary. Demetriades, who has had several bogus reviews written about his restaurant, didn’t try to sue Yelp for those bogus reviews, but instead sued Yelp for claiming that reviews on the site are trustworthy. Yelp brought an anti-SLAPP motion, which was DENIED.
We also examined Douglas Gotterba v. John Travota, where Travolta’s former pilot from the 80’s has decided to publish a tell-all book about Travolta, that apparently alleges a homosexual lifestyle. When Travolta threatened to sue, claiming Gotterba was subject to a confidentiality agreement, Gotterba did exactly what you are supposed to do, and filed a declaratory relief action.
Basically, Gotterba is simply asking a court to determine if he is in fact subject to a confidentiality agreement. If so, he will slunk away into the night. If not, then he will be free to publish the book. Great solution, right?
Not according to Travolta’s attorneys. they claimed that Gotterba’s action was really just an attempt to get Travolta’s attorneys to stop sending warning letters to publishers. Since pre-litigation letters are privileged, they brought an anti-SLAPP motion against the declaratory relief action.
The Court of Appeal ruled that the letters may have triggered the action, but they are not the basis of the action. Motion DENIED.
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SLAPP009 – Scope of Discovery after Anti-SLAPP Motion
It was a great anti-SLAPP week at Morris & Stone. Today we discuss two of our motions, and the result of last week’s Evil Yogurt Maker case. We will examine the scope of discovery following the filing of an anti-SLAPP motion, and apply those standards to a pending motion.
Specifically, I discuss the case of Britts v. Superior Court (2006) 145 Cal.App.4th 1112. In Britts, the defendant filed an anti-SLAPP motion on the same day that his opposition to a motion to compel was due. He argued that under the plain wording of CCP section 425.16(g), the motion stays all discovery “proceedings”, and therefore he was not required to file any opposition to the motion. The trial court disagreed, and granted the unopposed motion to compel, and awarded $5,000 in sanctions.
Britts took the matter up on a writ, and the Court of Appeal ordered the trial court to vacate the ruling on the motion to compel and for sanctions, holding that the statute means exactly what it says; an anti-SLAPP motion stops all discovery proceedings, including any pending discovery motions.
The trial court had also made a strange ruling (on an earlier anti-SLAPP motion in the case) that the defendant was not entitled to all the attorney fees incurred on the motion, because he had failed to meet and confer with opposing counsel. In other words, the court felt that if plaintiff’s counsel had simply been informed that one of the causes of action was a SLAPP, the complaint could have been amended and the motion avoided. That was not a holding from the case, but I explain why that reasoning is terrible and, if followed, could constitute malpractice.
I also discuss the case of Blanchard v. DirecTV (2004) 123 Cal.App.4th 903. In Blanchard, the court deliniated the scope of permissible discovery after an anti-SLAPP motion has been filed. As set forth in CCP section 425.16(g), a plaintiff must show good cause before taking ANY discovery after an anti-SLAPP motion has been filed. Good cause means ONLY discovery relevant to the Plaintiff’s burden of establishing a reasonable probability of prevailing on the claim. Discovery that is NOT relevant to a legal defense being asserted by the Defendant in the anti-SLAPP motion is not permitted.
Given that Blanchard permits only discovery related to potential defenses by the defendant, the case of Balzaga v. Fox News (2009) 173 Cal.App.4th 1325 came to the logical conclusion that if a plaintiff seeks leave to pursue discovery on a given defense, the defendant can prevent that discovery by informing the court that it is waiving that defense.
Finally, I discuss the case of Tutor-Saliba Corp v. Herrara (2006) 136 Cal.App.4th 604. This case sets forth the discretionary standard for granting leave to permit discovery following the filing of an anti-SLAPP motion, and held that a trial court’s decision to disallow discovery “will not be disturbed unless it is arbitrary, capricious, or patently ABSURD.” (Emphasis added.)
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SLAPPs: Birds do it, bees do it, even big law firms that should know better, do it.
I’m not so sure about that title, but it made me chuckle. The point of this article is that attorneys who create SLAPPs run the gamut, including large firms, who would presumably have an attorney or two who should know better. This latest case in my office is an object lesson as to how SLAPPs come about, and why the California’s SLAPP statute was such a great idea.
The case is the typical scenario where my client went off and started a business to compete with his former employer, and the former employer doesn’t like that one bit. The company sued, claiming the usual misappropriation of trade secrets, interference with prospective economic advantage and the like. My client cross-complained for breach of contract, because the company stopped paying certain significant residuals to which he is entitled. We will ultimately win, but the company is going to do what it’s going to do.
“Don’t you dare tell the world about how we’re going out of business.”
One thing it decided to do was to use the action to silence any criticism by my client. My client sent out a cautionary email to employees of the company, warning them about the shenanigans of the company. He explained that the company had not only breached contracts by cutting off his residuals, it had done the same to someone else. The email then directed the recipients to reports about the company published by Moody’s and Bloomberg, as well as press releases by the company itself, which all stated that the company is in some pretty dire financial straights.
He also sent out a press release, summarizing some events in the litigation. Specifically, when we took the deposition of the former vice president of the company, he took the Fifth and refused to answer any questions. The press release accurately reported those facts.
The company is represented by a law firm I had never heard of before this case, but according to its letterhead, it has some 30 offices, with five or six of them right here in California. It must be a pretty big firm.
The company and its attorneys apparently decided that while they were doing what they were going to do, my client is not allowed to tell anybody about the litigation or point to news stories about the finances of the company. They amended their complaint, adding four cause of action for libel, trade libel*, false advertising and unfair competition, all based on the email and the press release.
Under the heading of you can’t make this stuff up, here are some of the things they alleged were defamatory.
“It’s not 100% certain we are going to fail, it’s only close to 100%.”
My client provided a link to the article by Moody’s, and he said, “as one analyst says, the chances of [the company] defaulting on its [debts] is 100%.”
That’s defamatory, according to the complaint, because the analyst actually said, “the chances of [the company] defaulting on its [debts] is close to 100%.” So, apparently in opposing counsels’ world, that difference is defamatory because someone wanting to invest in the company would be put off by reading that the chance of default is 100%, but if they knew it was only “close to 100%” then they would be pulling out their checkbooks.
My client also wrote that his “complaint against [the company] alleges twelve causes of action, including . . . breach of the covenant of good faith and fair dealing . . . among others.”
Why is that defamatory? Because according to the complaint, my client did NOT file a complaint, he filed a CROSS-complaint, and the cause of action for breach of the covenant of good faith and fair dealing was thrown out on demurrer (before I was involved).
So, again, for that to have caused any loss of reputation, we have to assume that someone considering working for the company or investing in it would say, “I’m fine with a company that doesn’t pay its employees, so long as that’s only alleged in a cross-complaint, and so long as there is no cause of action for breach of the implied covenant. But if there’s a COMPLAINT that alleges breach of the implied covenant, the deal’s off!
This is the precise sort of case for which the anti-SLAPP statute was designed. In my never to be humble opinion, the causes of action were added purely out of a desire to gain leverage in the action, and a quick disposal of that sort of claim is the purpose of the anti-SLAPP statute. This was the quintessential SLAPP, and you are left scratching your head as to how a firm could have blundered into it, unless . . .
Crazy like a fox?
Since the SLAPP was so obvious, it has not escaped me that the firm may be crazy like a fox. It just smacks of a set-up. As stated, at the end of the day the company will be writing my client a substantial check. When I first came into the case, opposing counsel was fighting to postpone the trial, trying to put off that eventuality. It takes about six months to have a motion heard in this courtroom, and the judge does not move up motions on an ex parte application unless there has been a cancellation. If opposing counsel checked my background and saw that anti-SLAPPs are a big part of my practice, they may have filed an intentional SLAPP as a means to delay the action. That may seem crazy given the attorney fees that will come from the successful motion, but given the finances of the company, the goal might just be to push this case beyond a bankruptcy filing.
Still, I was recently retained to handle an appeal in a case where the judge improperly denied an anti-SLAPP motion, and then compuounded the error by refusing to give a jury instruction on protected speech. The jury awarded substantial damages based on protected speech. That case illustrates why it is crucial to get protected activities out of the action, even if it is clear that the plaintiff may have filed a SLAPP for purposes of delay.
*A rookie mistake to allege trade libel. It seldom makes sense to allege trade libel because the elements are far harder to meet than an action for libel, and it certainly doesn’t make sense to allege trade libel when you are already alleging libel.
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