|The anti-SLAPP law has been an inviting first line of attack for the defense bar--and a nightmare for the plaintiffs' bar--ever since its passage 19 years ago. Anti-SLAPP motions have spawned over 4,000 published opinions, in which courts repeatedly attempt to clarify the law's provisions. In 2003, the legislature became concerned enough with the "disturbing abuse" of the anti-SLAPP law to create statutory exemptions for commercial speech and public interest lawsuits.1 The legislature further limited the anti-SLAPP law in 2005 by addressing the courts' application of the law to malicious prosecution cases.2
Last year, the California Court of Appeals the California Supreme Court, and the Ninth Circuit continued to interpret and clarify the anti-SLAPP law. The 2010 anti-SLAPP opinions of these courts addressed several procedural issues as well as two categories of issues on the merits: 1) whether the acts in dispute are constitutionally protected within the meaning of the anti-SLAPP law, and 2) whether the plaintiff has met its burden.
In 1992, the California Legislature enacted what is now Code of Civil Procedure Section 425.16 in response to a "disturbing increase in lawsuits brought primarily to chill the valid exercise of the constitutional rights of freedom of speech and petition."3 The section, which applies to "strategic lawsuits against public participation," is commonly referred to as the anti-SLAPP law.4 An anti-SLAPP motion is a special motion to strike to expedite the early dismissal of unmeritorious causes of action that are aimed at preventing citizens from exercising their constitutional rights of petition or free speech in connection with a public issue.5
The motion involves a two-step process. In step one, the moving defendant has the burden of making a prima facie showing that the plaintiff's cause of action arises from an act "in furtherance of the [defendant's] right of petition or free speech...in connection with a public issue."6 If the defendant satisfies step one, the court proceeds to step two to decide if the plaintiff can meet its burden of establishing "a probability that [the] plaintiff will prevail on the claim." If the defendant fails to meet its threshold burden under step one, the inquiry ends.7
For the defendant to meet its burden in step one, it must establish that the statement or conduct on which the cause of action is based falls within one of the four categories delineated in Section 425.16(e).8 Three of the categories involve written or oral statements made 1) before a judicial proceeding (or other official proceedings),9 2) in connection with an issue under consideration or review by a judicial body (or other official bodies),10 or 3) in a place open to the public or a public forum in connection with an issue of public interest.11 The fourth category involves other conduct in furtherance of the exercise of the right of petition or free speech regarding a public issue or an issue of public interest.12
With limited exceptions, the filing of an anti-SLAPP motion stays all discovery proceedings in the action13 and, if the motion is successful, an award of attorney's fees to the moving defendant is mandatory.14 The downside to the moving defendant is that if the court denies the motion and determines that the motion was "frivolous or...solely intended to cause unnecessary delay," the court may award discretionary attorney's fees to the plaintiff pursuant to Code of Civil Procedure Section 128.5.15 An order granting or denying an anti-SLAPP motion is automatically appealable under Code of Civil Procedure Section 904.1.16
In 2010, courts addressed procedural issues that previously were unclear or unresolved. Among these was bifurcating the hearing. If the defendant challenges whether the plaintiff's claim arises out of the defendant's constitutionally protected speech or petition activity, courts may find it logical to bifurcate the motion. Since the court need not go to step two (the plaintiff's probability of success) unless the moving defendant has met its burden in step one (protected activity), the court and one or both parties may prefer to save the time and expense of having to brief both steps and instead focus only on step one.
The statute does not provide direct authority for or against bifurcation. It does have a strict timing requirement: The hearing on the motion must be scheduled within 30 days after service of the motion unless the docket conditions of the court require a later hearing.17 Given that statutory deadline, it may seem implausible to bifurcate the hearing on the anti-SLAPP motion into separate hearings on step one and step two and still be able to complete both within 30 days. However, having the hearing on step one within 30 days and continuing the hearing on step two to a future date may be the approach for satisfying the scheduling requirement.
In All One God Faith, Inc. v. Organic and Sustainable Industry Standards, Inc.,18 the one decision in 2010 that addressed bifurcation, the trial court had bifurcated the anti-SLAPP motion and permitted briefing and a hearing on step one before doing the same for step two. In its opinion, the court of appeal wrote, "By trial court order, not contained in the record but acknowledged by the parties, briefing and argument on the motion to strike was bifurcated, with the first portion of the hearing limited to the threshold question of whether [the defendant's] alleged conduct constituted an 'act in furtherance of a person's right of petition or free speech....'"19 This statement, without comment, left it unclear whether the bifurcation was a result of the trial court's own motion or by stipulation of the parties. Nevertheless, it was a cost-saving move, because the motion was denied on step one by the trial court and affirmed on appeal. However, if the court of appeal had reversed, it would not have had the benefit of an analysis of step two for a de novo review. Its only option in that scenario would have been to reverse on the analysis of step one and send the case back to the court below for a full briefing on the motion.
The California Supreme Court in Simpson Strong-Tie Company, Inc. v. Gore20--its only anti-SLAPP opinion in 2010--addressed a procedural issue regarding Code of Civil Procedure Section 425.17's commercial speech exemption to the anti-SLAPP law. The statute does not expressly address whether the burden is on the moving defendant to establish that the exemption does not apply or whether it is the burden of the plaintiff opposing the motion to establish that the exemption does apply. The supreme court provided a definitive answer.
The Simpson court reviewed the court of appeal's affirmation of the trial court's granting of an anti-SLAPP motion on causes of action for defamation, trade libel, false advertising, and unfair business practices by a manufacturer of galvanized screws against an attorney who had placed an advertisement in a newspaper. The advertisement was directed to "Wood Deck Owners," referenced galvanized screws manufactured by the defendant and others, and stated, "Please call if you would like an attorney to investigate whether you have a potential claim." The trial court granted the defendant's anti-SLAPP motion, finding that the defendant had established that 1) the statements were made in furtherance of the right of petition or free speech on an issue of public interest, 2) the plaintiff failed to demonstrate a probability of prevailing on the merits, and 3) the commercial speech exemption did not apply because the advertisement made no statement about a business competitor's products or services.21 The court of appeal affirmed and assigned the burden of invoking the exemption to the plaintiff, disagreeing with a prior published opinion to the contrary.22
The supreme court affirmed the court of appeal's ruling. In doing so, the court drew a bright line: "The burden of proof as to the applicability of the commercial speech exemption, therefore, falls on the party seeking the benefit of it--i.e., the plaintiff."23
Parties involved in anti-SLAPP motions often ask if the award of attorney's fees can be against not only the opposing party but also the opposing party's attorney. In Moore v. Kaufman,24 the court of appeal considered that issue in the context of mandatory attorney's fees to a successful moving defendant. The trial court had ordered the plaintiff's attorney as well as her client to pay the defendant's attorney's fees. After the plaintiff's attorney was found in contempt for refusing to answer questions at a judgment debtor's examination, she filed a petition for writ of mandate. The court of appeal granted the petition, finding the judgment against the attorney to be void because the attorney was not a party to the litigation, and Code of Civil Procedure Section 425.16(c)(1) does not authorize an award of attorney's fees against a party's attorney.25
The Moore court took note of a comment by the California Supreme Court that the purpose of the mandatory fee award is to discourage SLAPP suits "by imposing the litigation costs on the party" that files a SLAPP suit.26 Thus, counsel's payment obligations under the attorney's fee order were stricken.27
In contrast to Moore, a court may award attorney's fees against a defendant's attorney who files an unsuccessful anti-SLAPP motion. Code of Civil Procedure Section 425.16(c)(1) allows the court to award attorney's fees and costs to the plaintiff under Code of Civil Procedure Section 128.5(a) if the court finds that the motion is "frivolous or is solely intended to cause unnecessary delay." Section 128.5(a) expressly permits trial courts to "order a party, the party's attorney, or both to pay any reasonable expenses, including attorney's fees...." Thus, attorneys who file anti-SLAPP motions risk an award of attorney's fees against them if they lose, but attorneys who oppose anti-SLAPP motions do not face that same risk.
The appealability of attorney's fee awards was also addressed in 2010. In Baharian-Mehr v. Smith28 the plaintiff defeated an anti-SLAPP motion on claims of accounting, injunctive relief, breach of fiduciary duty, constructive fraud, constructive trust, and declaratory relief. The plaintiff did so because the dispute at issue was a business dispute that did not involve protected activity.29 After the required finding of frivolousness, the plaintiff was awarded attorney's fees. When the defendant appealed both the order on the anti-SLAPP motion and the order on the attorney's fees, the plaintiff argued that the attorney's fees award was reviewable only on appeal from a final judgment.
The court of appeal rejected that argument. It reached this result because "[i]n cases where...the issue of whether the anti-SLAPP motion should have been granted is properly before the appellate court, it would be absurd to defer the issue of attorney fees until a future date, resulting in the probable waste of judicial resources."30
From the viewpoint of plaintiffs, defeating an anti-SLAPP motion by showing that the allegations against the defendant are not based on protected activity (step one) means that plaintiffs are spared the anxiety of having the court move to step two, in which they bear the burden of proving the probability of success. With a 15-page limitation for oppositions,31 plaintiffs must carefully allocate sufficient space to step one, yet leave enough pages for the often more fact-intensive step two in which they establish the probability of prevailing.
In 2010, the opinions in which anti-SLAPP motions were denied in step one necessarily focused on the gravamen of the claims not being constitutionally protected within the meaning of the statute. These included claims for, or based on: 1) legal malpractice,32 2) city land use guidelines,33 3) purely business disputes,34 4) trade association activities,35 5) hospital peer review activity,36 and 6) city contracts based on competitive bidding,37 to name a few.
The court of appeal in Robles v. Chalilpoyil38 denied an anti-SLAPP motion by an expert witness sued by former clients for conspiring with the clients' attorney in a prior action to give false deposition testimony and to conceal a business agreement with the attorney. Robles reiterated the established rule in legal malpractice cases regarding lawyer defendants: "It is true that the statute protects litigation-related speech and petitioning activity undertaken on another's behalf...but the statute should not be used to insulate those statements from recourse by the very client on whose behalf the statement was made."39 The Robles court concluded that there was no reason to create an exception for expert witnesses.40
The court reached its conclusion by applying the gravamen test. Indeed, in evaluating the defendant's burden under step one, the court of appeal reiterated that the gravamen test controls:
[I]t is the principle thrust or gravamen of the plaintiff's cause of action that determines whether the anti-SLAPP statute applies...and when the allegations referring to arguably protected activity are only incidental to a cause of action based essentially on non-protected activity, collateral allusions to protected activity should not subject the cause of action to the anti-SLAPP statute.41
In D.C. v. R.R.,42 a case that addressed the emerging issue of cyberbullying by minors, a number of high school students posted offensive and threatening messages on a student's Web site. The Web site was designed to promote the student's career as a singer and actor. The postings included statements like "I want to rip out your f_______ heart and feed it to you....I've...wanted to kill you. If I ever see you I'm...going to pound your head in with an ice pick...."43 The student's parents reported the threats to the police, who suggested that the student withdraw from the school, which he did. The student and his parents then moved to another part of the state. None of the responsible students were suspended or expelled from the school.
The aggrieved student and his parents then sued six of the students who made the Web site postings, and their parents, for defamation and intentional infliction of emotional distress as well as for violating California's hate crimes laws. One of the defendants responded with an anti-SLAPP motion, arguing that the posted messages were protected speech and, more specifically, constituted written statements or writings made in a public forum in connection with an issue of public interest under Code of Civil Procedure Section 425.16(3)(3). The trial court denied the motion on the ground that the lawsuit did not arise out of a statement made in connection with a public issue. The court of appeal affirmed.44
The D.C. court noted that the First Amendment does not protect true threats--that is, "statements where the speaker means to communicate a serious expression of an intent to commit an act of unlawful violence to a particular individual or group of individuals."45 The court found that under both the objective standard for true threats (the reasonable recipient standard) and the subjective standard (the actual intent standard) the defendants did not make a sufficient showing of protected speech under step one.46 Moreover, the court found that the complaint did not involve a public issue because the "message did not concern a person in the public eye, conduct that could directly affect large numbers of people beyond the participants, or a topic of widespread public interest."47
Surprisingly few published opinions in 2010 involved an anti-SLAPP motion that was denied because the plaintiff met its burden in step two. It would seem that if defendants concluded that an anti-SLAPP motion was likely to end the case early, an adverse ruling would not discourage a follow-up appeal. Moreover, if a defendant filed the motion for delay, an appeal from an adverse ruling would be certain. Perhaps the reason for the scant litigation in this area is that defendants simply are not filing anti-SLAPP motions when they recognize that the plaintiff is likely to meet its burden. If so, the statutory threat of attorney's fees being awarded to a successful plaintiff may be having its desired effect.
One opinion from 2010 addressing step two was a defamation case, Wong v. Jing,48 in which a pediatric dentist sued the parents of a minor patient for libel in posting a critical review of her services on the Internet. The defendants' anti-SLAPP motion was denied by the trial court, and the court of appeal affirmed in part with regard to the defendant father, finding that the plaintiff dentist had met her burden in step two of presenting sufficient evidence that a jury could find in her favor on libel.49
However, the court of appeal also remanded and directed that the motion be granted on two other issues. First, the court directed the granting of the motion on behalf of the defendant wife based on the plaintiff's failure to produce evidence that the wife had anything to do with the Internet posting.50 Second, the court directed the motion to be granted on the plaintiff's causes of action for intentional and negligent infliction of emotional distress, because the evidence did not establish the sort of "severe" or "serious" emotional distress necessary to support those causes of action.51
The plaintiff had also sued Yelp, the publisher of the Web site. Yelp joined the parents in the anti-SLAPP motion. Before the hearing, the plaintiff voluntarily dismissed Yelp from the lawsuit without prejudice. When Yelp later joined in the appeal from the denial of the parents' anti-SLAPP motion, the plaintiff challenged Yelp's standing. The court held that Yelp had standing despite Yelp's dismissal. It reasoned that Yelp remained a party to the motion because it would have been entitled to an award of attorney's fees had the defendants prevailed.52
A number of opinions in 2010 involved anti-SLAPP motions that were granted--that is, the moving defendant met its burden in step one, and the opposing plaintiff did not meet its burden in step two. Many of these cases involved the right to petition, including malicious prosecution cases.53
In Haight Ashbury Free Clinics, Inc. v. Happening House Ventures,54 a nonprofit medical clinic brought an action for breach of fiduciary duty against a nonprofit landlord and the founder of both nonprofits. The trial court denied the defendants' anti-SLAPP motion, finding that the gravamen of the claims was mismanagement and self-dealing, but the court of appeal reversed.55 The appellate court's opinion focused on one paragraph in the plaintiff's complaint, in which 2 of the 16 alleged bases for liability involved protected petition activity: conspiring to testify falsely in depositions in an underlying lawsuit, and misrepresenting the facts of the underlying lawsuit in a letter to a newspaper. The court of appeal held that since the two subparagraphs alleging protected activity could be the sole and adequate basis for liability, they were not "merely incidental" to the unprotected activity--and thus step one was satisfied. The court then determined that the plaintiff had not met its burden in step two, and hence the entire cause of action was stricken.56 Significantly, the court of appeal opined that "the mere fact that there are numerically far fewer allegations of protected wrongdoing than there are allegations of nonprotected wrongdoing does not mean that the allegations of protected activity are merely incidental."57
G.R. v. Intelligator58 involved a husband's suit against the wife's attorney following a dissolution proceeding. The anti-SLAPP issue was whether the improper use by the wife's attorney of a consumer credit file--which was admitted to be in violation of the California Rules of Court--was protected petitioning activity or whether it lost its constitutional protection because it fell under the Flatley v. Mauro59 exception for criminal acts. The trial court found that the lawyer's conduct was protected and granted the anti-SLAPP motion.60 The court of appeal affirmed, concluding that the attorney's failure to redact personal information from the credit reports filed with the court was not the type of criminal activity required to remove the activity from constitutional protection.61
In Mallard v. Progressive Choice Insurance Company,62 an insured brought an action against its insurer and the insurer's attorney for invasion of privacy arising from the subpoenaing of the insured's mental health records during an arbitration of an uninsured motorist claim. The trial court granted the anti-SLAPP motion, and the court of appeal affirmed in relevant part on the ground that a mandatory arbitration of an uninsured motorist claim is an "official proceeding authorized by law" under the anti-SLAPP statute.63
Family members of a deceased sued a publisher of prescription drug monographs for breach of contract and negligence in Rivera v. Databank.64 The deceased was 50 years old and had been prescribed Paxil for stress. He filled the prescription at Costco, which provided its prescription drug customers with monographs sold to Costco by the publisher defendant. The publisher defendant filed an anti-SLAPP motion, which was denied by the trial court on the ground that the suit did not arise from the exercise of free speech and was also barred by the commercial speech exemption.65 The court of appeal reversed, holding that the monograph about antidepressants was speech in connection with an issue of public interest.66 Further, it held that the monograph did not constitute speech about the publisher's own product and thus was outside the commercial speech exemption.67 Under Code of Civil Procedure Section 425.17(c), the statements at issue must be about the speaker's or a competitor's business operations, goods, or services for the commercial speech exemption to apply.
Anti-SLAPP Law in Federal Court
It is well settled that the California anti-SLAPP law is available to litigants in diversity cases in federal court.68 However, the provisions of the law will not be applied if they conflict with federal rules.69 For example, the automatic discovery stay triggered by the filing of an anti-SLAPP motion70 is not applicable in federal court because it conflicts with the federal rules on discovery.71
This raises the question as to whether the automatic appeal right conferred by Code of Civil Procedure Section 425.16(i) for any order granting or denying an anti-SLAPP motion would apply in federal court. Logically, it would not because the right to appeal is procedural and not substantive, which would mean that federal rules should govern and not state law. The issue was addressed last year by the Ninth Circuit.
In Price v. Stossel,72 the Ninth Circuit reviewed the granting of an anti-SLAPP motion on a cause of action for defamation. Consistent with prior federal cases, the court did not rely on the automatic appeal right provided in the anti-SLAPP law itself but instead based its ruling on 28 U.S.C. Section 1291, which confers jurisdiction on the U.S. Court of Appeals from all final decisions in the district courts. Although not discussed in the opinion, the granting of the anti-SLAPP motion ended the case and thus was a final decision.
Early in 2010, the Ninth Circuit, in Hilton v. Hallmark Cards,73 examined the appealability of the denial of an anti-SLAPP motion. Hilton involved a celebrity, Paris Hilton, who sued a greeting card company for using her image and catchphrase in a birthday card without her permission. The district court dismissed one claim on a motion to dismiss under Rule 12(b)(6) of the Federal Rules of Civil Procedure and declined to dismiss other claims under the rule. The court also denied the defendant's anti-SLAPP motion filed against one claim. Although most of the opinion addressed the substantive law on the right to publicity, the Ninth Circuit first had to resolve the threshold question of whether it had appellate jurisdiction over the rulings on the various motions decided by the court below. The Ninth Circuit recognized that appellate courts generally only have jurisdiction over final judgments and orders and, in the case before it, the denial of the anti-SLAPP motion was neither. Nevertheless, the court held that it had jurisdiction to review the denial of the anti-SLAPP motion under the "collateral order doctrine," which applies to the "narrow class of decisions that do not terminate the litigation, but must, in the interest of achieving a healthy legal system...nonetheless be treated as final."74
Later in 2010, the Ninth Circuit relied on Hilton to once again review the denial of an anti-SLAPP motion. Mindy's Cosmetics, Inc. v. Dakar was a suit by a client against its attorney for claims including legal malpractice and breach of fiduciary duty arising out of the registration of trademarks.75 The district court denied the defendant's anti-SLAPP motion. While the Ninth Circuit disagreed with the district court that applying to register trademarks was not protected activity under step one, the Ninth Circuit nonetheless affirmed because it agreed that the plaintiff had nevertheless met its burden under step two of establishing a probability of prevailing on its claims.76
Thus, under the 2010 Ninth Circuit anti-SLAPP law cases, the automatic appeal provision of the anti-SLAPP law does not apply. However, the granting and the denial of an anti-SLAPP motion in federal court are both appealable under 28 U.S.C. Section 1291 and the collateral order doctrine.
Despite 19 years of judicial interpretation, the California anti-SLAPP law continues to be a hot topic and the subject of published opinions in state and federal courts. With creative defense counsel seeking to expand the umbrella of the law, and effective plaintiffs' counsel striving to constrict it, 2011 should be another exciting year for anti-SLAPP jurisprudence. n