Anheuser-Busch Companies, LLC et al v. Clark
Filing
35
ORDER signed by Judge Garland E. Burrell, Jr on 7/18/13: For the stated reasons, Plaintiffs' return of personal property claim is DISMISSED with prejudice. Defendants anti-SLAPP 14 Motion to Strike is DENIED. (Meuleman, A)
1
2
3
4
5
6
7
IN THE UNITED STATES DISTRICT COURT
8
FOR THE EASTERN DISTRICT OF CALIFORNIA
9
10
11
12
ANHEUSER-BUSCH COMPANIES, LLC, a
Delaware limited liability
company, and ANHEUSER-BUSCH,
LLC, a Missouri limited
liability company,
Plaintiffs,
13
v.
14
15
JAMES ALAN CLARK, an individual,
16
Defendant.
________________________________
)
)
)
)
)
)
)
)
)
)
)
)
)
)
2:13-cv-00415-GEB-CKD
ORDER GRANTING MOTION TO
DISMISS AND DENYING SPECIAL
MOTION TO STRIKE
17
18
Defendant moves for dismissal of Plaintiffs’ return of
19
personal property claim and seeks to strike Plaintiffs’ lawsuit under
20
California’s
21
Plaintiffs oppose the motions.2
anti-SLAPP
statute,
Cal.
Civ.
Proc.
Code
§
425.16.1
22
1
23
24
“SLAPP” is an acronym for a strategic lawsuit against public
participation. Oasis W. Realty, LLC v. Goldman, 51 Cal. 4th 811, 815 n.1
(2011).
2
25
26
27
28
Plaintiffs also request oral argument or leave to file a surreply
to point out what they characterize as “clearly erroneous statements of
facts and law” in Defendant’s reply brief. (Pls.’ Req. for Oral Arg.,
ECF No. 31, 1:20.) This request is denied since it is unnecessary to
disposition of the pending motions. See Guidiville Band of Pomo Indians
v. NGV Gaming, Ltd., 531 F.3d 767, 787 (9th Cir. 2008) (Smith, J.,
dissenting) (approving district court’s refusal to allow surreply deemed
(continued...)
1
1
I. FACTUAL ALLEGATIONS
2
Plaintiffs allege in their complaint that Defendant left
3
Plaintiffs’
4
misappropriated, disclosed, disseminated, and/or used [Plaintiffs’]
5
confidential, proprietary, and/or trade secret information, prior to the
6
termination
7
employment.” (Id. ¶ 21.) On February 8, 2013, Plaintiffs “invoked the
8
certification provision of [Defendant’s] Confidentiality Agreements due
9
to [their] belief that [Defendant] violated the[se] provisions . . . by
10
improperly using or disclosing [Plaintiffs’] confidential, propriety
11
[sic], and/or trade secret information.” (Id. ¶ 22.) Defendant “refused
12
to
13
required by his Confidentiality Agreements. (Id. ¶¶ 22, 23.)
provide
14
15
employ
of
the
his
in
June
2012,
employment,
written
and
(Compl.
since
[non-disclosure]
¶
the
2),
and
“wrongfully
termination
certification
of
under
his
oath”
II. DISCUSSION
A.
Supersession by the California Uniform Trade Secrets Act
16
Defendant argues Plaintiffs’ return of personal property claim
17
should be dismissed because it is superseded by the California Uniform
18
Trade Secrets Act (“CUTSA”),3 which was enacted to “make uniform the law”
19
concerning trade secrets. Cal. Civ. Code § 3426.8. Although CUTSA lacks
20
21
2
(...continued)
unnecessary to the disposition).
22
3
23
24
25
26
27
28
Both parties use the word “preempt” instead of the word
“supersede” when discussing CUTSA’s effect on Plaintiffs’ return of
personal property claim. (E.g., Def.’s Mot. to Dismiss 1:26; Pls.’ Opp’n
to Mot. to Dismiss 1:3.) However, in California, “preemption concerns
whether a federal law has superseded a state law or a state law has
superseded a local law, not whether one provision of state law has
displaced other provisions of state law.” Zengen, Inc. v. Comerica Bank,
41 Cal. 4th 239, 247 n.5 (2007). Accordingly, since CUTSA itself employs
the term “supersede” to describe its effect on other California laws,
see Cal. Civ. Code § 3426.7(a), the term “supersede” is employed here
throughout. See Silvaco Data Sys. v. Intel Corp., 184 Cal. App. 4th 210,
232 n.14 (2010) (adopting the term “supersede” in this context).
2
1
an explicit supersession provision, it implicitly supersedes all claims
2
not covered by its savings clauses, which exempt from supersession
3
“contractual remedies,” “criminal remedies,” and “other civil remedies
4
that are not based upon misappropriation of a trade secret.” Cal. Civ.
5
Code §
6
Operations, Inc., 171 Cal. App. 4th 939, 954 (2009). Defendant argues
7
that Plaintiffs’ return of personal property claim is subject to CUTSA’s
8
implicit supersession since it is not covered by any of CUTSA’s savings
9
clauses.
3426.7(b);4
K.C.
Plaintiffs
Multimedia,
counter
that
Inc.
v.
their
Bank
claim
of
is
Am.
Tech. &
exempted
from
10
supersession under § 3426.7(b)(2) because the claim is “not based” in
11
full “upon misappropriation of a trade secret.” (See Pls.’ Opp’n to Mot.
12
to Dismiss, ECF No. 18, 3:8—10 (asserting that “[t]o the extent that the
13
return
14
misappropriation of trade secrets, it is not subject to preemption”).)
15
Plaintiffs
also
16
“premature”
since
17
alternate theories,” and their return of personal property claim is “in
18
addition
19
misappropriation claim. (Id. 1:16—17, 3:5.)
of
personal
to”
or
property
argue
that
Plaintiffs
“an
claim
is
not
Defendant’s
are
“entitled
alternative
to”
based
solely
supersession
to
their
plead
CUTSA
on
the
motion
is
multiple
and
trade
secrets
20
The parties advance—and courts have employed—three distinct
21
approaches when defining the scope of Cal. Civ. Code § 3426.7(b)(2)’s
22
exemption from supersession for “other civil remedies that are not based
23
24
25
26
27
28
4
CUTSA’s savings clauses state in full: “This title does not affect
(1) contractual remedies, whether or not based upon misappropriation of
a trade secret, (2) other civil remedies that are not based upon
misappropriation of a trade secret, or (3) criminal remedies, whether or
not based upon misappropriation of a trade secret.” Cal. Civ. Code §
3426.7(b).
3
1
upon misappropriation of a trade secret.”5 Under one approach a claim has
2
been found exempt from supersession by § 3426.7(b)(2) so long as the
3
claim requires the allegation of “something more” than just CUTSA trade
4
secrets misappropriation. E.g., Leatt Corp. v. Innovative Safety Tech.,
5
LLC, No. 09-CV-1301-IEG (POR), 2010 WL 2803947, at *6 (S.D. Cal. July
6
15,
7
plaintiffs “base their injury not only the theft of their trade secrets,
8
but also on other ‘confidential’ and/or ‘proprietary’ information”)
9
(emphases added); PostX Corp. v. Secure Data in Motion, Inc., No. C 02-
10
04483 SI, 2004 WL 2663518, at *3 (N.D. Cal. Nov. 20, 2004) (denying
11
CUTSA supersession since plaintiff’s common law and CUTSA claims “are
12
not based on precisely the same nucleus of facts,” but involve “new
13
facts” as well) (emphases added). Another approach has found a claim
14
exempt from supersession under § 3426.7(b)(2) unless it is based on the
15
taking of information that is ultimately adjudged to be a trade secret.
16
E.g., Ali v. Fasteneres for Retail, Inc., 544 F. Supp. 2d 1064, 1072
17
(E.D. Cal. 2008) (denying CUTSA supersession dismissal motion since “at
18
this
19
misappropriated information was a trade secret”). Under this approach,
20
since designation of information as a trade secret involves a “largely
21
factual” inquiry that can rarely be conducted via a dismissal motion,
22
K.C. Multimedia, Inc., 171 Cal. App. 4th at 954, dismissal motions are
23
typically denied as “premature,” Ali, 544 F. Supp. 2d at 1072, or
24
“inappropriate for resolution at th[e dismissal] stage.”
2010)
(rejecting
point,
it
is
CUTSA
still
supersession
unclear
how
since
much
in
of
their
the
complaint
allegedly
Strayfield
25
26
27
28
5
Because CUTSA explicitly exempts contractual and criminal remedies
from supersession, Cal. Civ. Code § 3426.7(b)(1), (3), contractual and
criminal remedies are not discussed here. Thus all references to
supersession of claims under CUTSA concern only civil noncontractual
claims.
4
1
Ltd. v. RF Biocidics, Inc., No. CIV. S-11-2613 LKK/GGH, 2012 WL 170180,
2
at *1 (E.D. Cal. 2011). Other courts have found § 3426.7(b)(2) only
3
saves a claim from supersession if a plaintiff “assert[s] some other
4
basis” beside trade secrets law for a property right in the information
5
at issue. E.g., Silvaco Data Sys. v. Intel Corp., 184 Cal. App. 4th 210,
6
237—39 & n.22 (2010), disapproved of on other grounds by Kwikset Corp.
7
v. Superior Court, 51 Cal. 4th 310, 337 (2011) (setting forth this
8
approach and rejecting the alternative CUTSA supersession approaches,
9
referenced herein as the “premature” and “something more” approaches);
10
K.C.
11
“something more” approach). See generally Roger M. Milgrim, Milgrim on
12
Trade Secrets, § 1.01[3][a], at 1.240.14(73)—(75), 1.240.14(78)(a)—(82)
13
(discussing these divergent approaches to supersession generally and
14
noting that courts remain divided on the issue).
Multimedia,
Inc.,
171
Cal.
App.
4th
at
958
(rejecting
the
15
Here, the success of Defendant’s dismissal motion depends on
16
which approach is employed when determining the CUTSA supersession
17
issue.6 Plaintiffs urge the Court to adopt either the “something more”
18
or the “premature” approach, arguing that either of these approaches
19
warrants denial of Defendant’s dismissal motion. (See Pls.’ Opp’n to
20
Mot. to Dismiss 4:24, 3:8—10 (asserting Defendant’s “motion to dismiss
21
22
6
23
24
25
26
27
28
Plaintiffs’ claim for return of personal property is based
essentially on the allegation that Defendant took Plaintiffs’
“confidential, proprietary, and/or trade secret information.” (Compl. ¶¶
21, 22, 43, 44.) No further detail is alleged in the complaint about the
information taken, and no “personal property” other than the referenced
“information” was allegedly taken. Cf., e.g., Ikon Office Solutions,
Inc. v. Rezente, No. CIV. 2:10-1704 WBS EFB, 2011 WL 1402882, at *3
(E.D. Cal. Apr. 13, 2011) (denying CUTSA supersession motion without
deciding the scope of § 3426.7(b)(2) since plaintiff’s non-CUTSA claim
could be pled without reference to the taking of valuable information);
Aversan USA, Inc. v. Jones, No. 2:09-cv-00132-MCE-KJM, 2009 WL 1810010,
at *3—5 (E.D. Cal. June 24, 2009) (same).
5
1
is premature” and “[t]o the extent that the return of personal property
2
claim is not based solely on the misappropriation of trade secrets, it
3
is not subject to preemption”).) Defendant counters that the Silvaco
4
Data Systems approach governs and requires dismissal of Plaintiffs’
5
return of personal property claim. (Def.’s Reply in Supp. of Mot. to
6
Dismiss 1:23—2:12 (arguing Plaintiffs misstate the law and urge the
7
wrong result by omitting reference to Silvaco Data Systems—the leading
8
California
9
supersession unless Plaintiffs assert some other basis beside trade
10
Court
of
Appeals
opinion
on
the
issue
that
requires
secrets law for a property right in the taken information).)
11
Plaintiffs argue that supersession is “premature” since they
12
are “entitled to plead multiple and alternate theories” in the complaint
13
while “await[ing] the development of evidence in discovery.” (Pls.’
14
Opp’n to Mot. to Dismiss 4:24, 1:16—17, 1:8—9.) Rule 8(d)(2) authorizes
15
“[a] party [to] state as many separate claims . . . as it has,
16
regardless
17
preemption in a motion to dismiss.” Johnson v. Armored Transp. of Cal.,
18
Inc., 813 F.2d 1041, 1043 (9th Cir. 1987); e.g., Menchaca v. CNA Grp.
19
Life Assur. Co., 331 Fed. App’x 298, 304 (5th Cir. 2009) (finding “no
20
merit”
21
alternative pursuant to Federal Rule of Civil Procedure 8 and thus not
22
subject to preemption” under ERISA); SunPower Corp. v. SolarCity Corp.,
23
No. 12-CV-00694-LHK, 2012 WL 6160472, at *14 (N.D. Cal. Dec. 11, 2012)
24
(considering and rejecting plaintiff’s argument “that it would be
25
‘premature’ to address the question of [CUTSA] supersession at the
26
motion to dismiss stage”); Atrium Grp. De Ediciones Y Publicaciones,
27
S.L. v. Harry N. Abrams, Inc., 565 F. Supp. 2d 505, 510 (S.D.N.Y. 2008)
in
of
consistency.”
plaintiff’s
However,
argument
that
28
6
“[l]itigants
his
“claims
ordinarily
are
pled
argue
in
the
1
(concluding that “Rule 8(d)(2) of the Federal Rules of Civil Procedure
2
does not purport to override § 301 preemption” under the Copyright Act).
3
Decision
on
Defendant’s
dismissal
motion
thus
requires
4
determination of the scope of supersession under CUTSA § 3426.7(b)(2).
5
CUTSA is modeled on the Uniform Trade Secrets Act (“UTSA”) and codified
6
in California Civil Code § 3426 through § 3426.11. It is comprehensive
7
in its structure and breadth. K.C. Multimedia, Inc., 171 Cal. App. 4th
8
at 957; accord Hat World, Inc. v. Kelly, No. CIV. S-12-01591 LKK/EFB,
9
2012 WL 3283486, at *4 (E.D. Cal. Aug. 10, 2012). CUTSA’s provisions
10
contain
11
injunctive relief for actual or threatened misappropriation, damages,
12
attorney fees, methods for preserving the secrecy of trade secrets, the
13
limitations period, the effect of the title on other statutes or
14
remedies, statutory construction, severability,’” and other aspects of
15
trade secrets law. K.C. Multimedia, Inc., 171 Cal. App. 4th at 954
16
(quoting AccuImage Diagnostics Corp. v. Terarecon, Inc., 260 F. Supp. 2d
17
941, 953 (N.D. Cal. 2003)) (describing Cal. Civ. Code §§ 3426.1—.11).
18
“CUTSA’s ‘comprehensive structure and breadth’ suggests a legislative
19
intent to occupy the field.” K.C. Multimedia, Inc., 171 Cal. App. 4th at
20
957; see also Silvaco Data Sys., 184 Cal. App. 4th at 234 (“[T]he act as
21
a whole[] manifest[s] a Legislative intent to occupy the field of trade
22
secret liability to the exclusion of other civil remedies.”); see
23
generally Rojo v. Kliger, 52 Cal. 3d 65, 80 (1990) (explaining that
24
“general
25
legislative intent).
26
“‘the
and
definition
comprehensive
of
misappropriation
legislation”
and
indicates
trade
a
secret,
supersessive
Further, CUTSA’s stated purpose is “to make uniform the law.”
27
Cal. Civ. Code § 3426.8. Its goal, as explained in UTSA, is the
28
“substitution of unitary definitions of trade secret and trade secret
7
1
misappropriation . . . for the various property, quasi-contractual, and
2
violation of fiduciary relationship theories of noncontractual liability
3
utilized at common law.” Unif. Trade Secrets Act prefatory note, 14
4
U.L.A. 531 (2005). Its terms are to “be applied and construed to
5
effectuate [this] general purpose.” Cal. Civ. Code § 3426.8; see also
6
Unif. Trade Secrets Act § 8, 14 U.L.A. 656 (2005). In light of CUTSA’s
7
scope and purpose, permitting Plaintiffs to proceed with both their
8
CUTSA and return of personal property claims would prevent the intended
9
“substitution of unitary definitions for the . . . various theories
10
. . . of noncontractual liability” utilized before CUTSA’s adoption and
11
thus
12
prefatory note; see Silvaco Data Sys., 184 Cal. App. 4th at 233—34
13
(“[CUTSA’s]
14
supplementary
15
governing trade secret liability. The central purpose of the act was
16
precisely to displace that web with a relatively uniform and consistent
17
set of rules defining—and thereby limiting—liability.”).
contravene
CUTSA’s
purpose
to
stated
could
the
not
purpose.
be
notoriously
Unif.
served
by
haphazard
Trade
merely
web
of
Secrets
Act
making
[it]
disparate
laws
18
Further, the effect of supersession under CUTSA is facially
19
broader than what exists under UTSA. The Uniform Trade Secrets Act
20
states that it “displaces conflicting . . . law,” Unif. Trade Secrets
21
Act § 7(a), 14 U.L.A. 651 (2005), meaning in multiple jurisdictions that
22
it
23
provisions.” K.C. Multimedia, Inc., 171 Cal. App. 4th at 956 (quotation
24
omitted).
25
however. See Fairbanks v. Superior Court, 46 Cal. 4th 56, 61 (2009)
26
(noting the Legislature’s omission of provision from proposed national
27
model
28
supersession clause, and instead contains savings clauses exempting
“only
law
preempts
California
common
law
claims
intentionally
“indicat[es]
its
rejected
intent”).
8
that
CUTSA
‘conflict’
this
omits
portion
UTSA’s
with
of
its
UTSA,
explicit
1
certain remedies from supersession, including “other civil remedies that
2
are not based upon misappropriation of a trade secret.” Cal. Civ. Code
3
§ 3426.7(b)(2). CUTSA thus implicitly supersedes all remedies not
4
covered by its savings clauses. Silvaco Data Sys., 184 Cal. App. 4th at
5
234; K.C. Multimedia, Inc., 171 Cal. App. 4th at 954. CUTSA’s implicit
6
general
7
provision displacing just “conflicting” law. Nonetheless, most courts
8
interpreting UTSA’s narrower preemption provision have found that, in
9
light of UTSA’s “history, purpose, and . . . statutory scheme,” it
10
supersedes other claims based on the taking of valuable information.
11
E.g., Robbins v. Supermarket Equip. Sales, LLC, 722 S.E. 2d 55, 58 (Ga.
12
2012) (finding UTSA supersedes every “lesser and alternate theory” based
13
on the taking of valuable information); BlueEarth Biofuels, LLC v. Haw.
14
Elec. Co., Inc., 235 P.3d 310, 321 (Haw. 2010) (noting the “majority of
15
the courts” interpreting UTSA have reached this conclusion); Mortg.
16
Specialists, Inc. v. Davey, 904 A.2d 652, 663 (N.H. 2006) (recognizing
17
that the “weight of authority” has held the same). Given CUTSA’s
18
intentionally broader wording, CUTSA supersedes those claims typically
19
displaced under the narrower UTSA provision, which California rejected.
20
Given CUTSA’s breadth and structure, its purpose of promoting
21
uniformity, and the broad superseding effect of narrower uniform trade
22
secrets acts, the approach outlined in Silvaco Data Systems is adopted,
23
and
24
“assert[s] some other basis” beside trade secrets law for a property
25
right in taken information. Silvaco Data Sys., 184 Cal. App. 4th at 238.
26
Accordingly, since Plaintiffs’ return of personal property
27
claim is based on the taking of “confidential, proprietary, and/or trade
28
secret information,” (Compl. ¶ 21), and since it is not exempted from
supersession
therefore
§
is
facially
3426.7(b)(2)
is
broader
than
inapplicable
9
UTSA’s
unless
preemption
a
plaintiff
1
supersession by § 3426.7(b), Plaintiffs’ return of personal property
2
claim is dismissed with prejudice. See Swartz v. KPMG LLP, 476 F.3d 756,
3
761 (9th Cir. 2007) (affirming dismissal with prejudice where statute
4
made amendment futile).
5
B.
Anti-SLAPP Special Motion to Strike
6
Defendant seeks to strike Plaintiffs’ remaining claims under
7
California’s anti-SLAPP statute, arguing that Plaintiffs’ claims are “an
8
attempt to punish [Defendant] for exercising his constitutional rights
9
of petition and free speech in connection with class action litigation
10
filed against [Plaintiffs by Defendant] exactly one week prior to this
11
action.” (Def.’s Special Mot. to Strike, (“Def.’s Mot.”), ECF No. 14,
12
1:2—4.)
13
[Defendant]
14
misappropriating confidential and trade secret information,” (Pls.’
15
Opp’n to Special Mot. to Strike (“Pls.’ Opp’n”) ECF No. 20, 10:19—21),
16
not on the class action.
Plaintiffs
respond
breaching
that
his
their
claims
are
Confidentiality
“premised
Agreements
on
and
17
“A SLAPP is a civil lawsuit that is aimed at preventing
18
citizens from exercising their political rights or punishing those who
19
have done so.” Simpson Strong-Tie Co., Inc. v. Gore, 49 Cal. 4th 12, 21
20
(2010). “SLAPP suits masquerade as ordinary lawsuits,” but “they are
21
generally meritless suits brought primarily to chill the exercise of
22
free
23
sanctions against the defendant.” Id. (quotation omitted); accord Hilton
24
v. Hallmark Cards, 599 F.3d 894, 902 (9th Cir. 2009). California’s anti-
25
SLAPP statute, Cal. Civ. Proc. Code § 425.16, was enacted to vindicate
26
free speech and petition rights due to concern over “‘a disturbing
27
increase’” in such suits. Oasis W. Realty, LLC, 51 Cal. 4th at 815 n.1
28
(2011) (quoting Cal. Civ. Proc. Code § 425.16(a)); accord DC Comics v.
speech
or
petition
rights
by
10
the
threat
of
severe
economic
1
Pac. Pictures Corp., 706 F.3d 1009, 1015—16 (9th Cir. 2013). Under the
2
statute, a defendant subjected to a SLAPP may file a special motion to
3
strike in state or federal court to expedite the early dismissal of the
4
plaintiff’s unmeritorious SLAPP claims. Price v. Stossel, 620 F.3d 992,
5
999 (9th Cir. 2010); Simpson Strong-Tie Co., 49 Cal. 4th at 21; see also
6
Makaeff v. Trump Univ., LLC, 715 F.3d 254, 272—75 (9th Cir. 2013)
7
(Kozinski, J., concurring) (recognizing the same, but calling for en
8
banc reconsideration of the federal application of the anti-SLAPP
9
statute).
10
When assessing an anti-SLAPP motion, the court considers the
11
pleadings and supporting and opposing affidavits to determine the facts
12
upon which liability is based. Cal. Civ. Proc. Code § 425.16(b)(2);
13
United States ex rel. Newsham v. Lockheed Missiles & Space Co., Inc.,
14
190 F.3d 963, 971 (9th Cir. 1999). Further, evidence favorable to
15
Plaintiffs
16
credibility of the evidence is assessed. Soukup v. Law Offices of
17
Herbert Hafif, 39 Cal. 4th 260, 269 n.3 (2006).
18
is
accepted
as
true,
and
neither
the
weight
nor
the
To prevail on his anti-SLAPP motion, Defendant must make a
19
threshold
20
Defendant’s “protected activity.” In re Episcopal Church Cases, 45 Cal.
21
4th 467, 477 (2009); accord DC Comics v. Pac. Pictures Corp., 706 F.3d
22
at 1013. If Defendant makes this initial showing, the burden shifts to
23
Plaintiffs to establish “a probability of prevailing on the claim[s].”
24
Oasis W. Realty, LLC, 51 Cal. 4th at 819—20; accord Vess v. Ciba-Geigy
25
Corp. USA, 317 F.3d 1097, 1110 (9th Cir. 2003).
showing
that
each
of
Plaintiffs’
claims
“arises
from”
26
Defendant’s threshold showing is “objective” and “strictly”
27
limited. Equilon Enters. v. Consumer Cause, Inc., 29 Cal. 4th 53, 65, 59
28
(2002). Defendant need not establish Plaintiffs’ subjective intent to
11
1
chill his speech or petition rights. Id. at 58—67. Nor need he show that
2
Plaintiffs’ actions actually engendered a chilling effect. City of
3
Cotati v. Cashman, 29 Cal. 4th 69, 75—76 (2002); accord Vess, 317 F.3d
4
at 1110. Instead, Defendant must simply demonstrate that he engaged in
5
“protected activity” and that each of Plaintiffs’ claims against him
6
“arises from” that protected activity. Navellier v. Sletten, 29 Cal. 4th
7
82, 89 (2002); accord Mindys Cosmetics, Inc. v. Dakar, 611 F.3d 590, 595
8
(9th Cir. 2010).
9
1. Protected Activity
10
Defendant argues he engaged in protected activity under §
11
425.16 by prosecuting a class action against Plaintiffs and by conveying
12
information to class counsel in advance of that litigation. (Clark
13
Decl., ECF No. 14—3, ¶ 4.) The anti-SLAPP statute specifically protects
14
“any written or oral statement or writing made before a
15
proceeding
16
consideration or review by a
17
Filing suit in federal court is “indisputably” a protected activity
18
under § 425.16. Navellier, 29 Cal. 4th at 90. Likewise, “communications
19
preparatory to or in anticipation of the bringing of an action . . . are
20
equally entitled to the benefits of section 425.16.” Briggs v. Eden
21
Council for Hope & Opportunity, 19 Cal. 4th 1106, 1115 (1999) (finding
22
defendant’s
23
litigation” that was initiated later and therefore constituted protected
24
activity under the statute); Flatley v. Mauro, 39 Cal. 4th 299, 322 n.11
25
(recognizing that “prelitigation conduct” falls within the ambit of §
26
425.16);
27
(collecting cases finding the same). Since Defendant filed a lawsuit in
28
federal court—a context specifically and “indisputably” protected by the
.
.
.
[or]
counseling
Siam
v.
made
in
connection
with
. . . judicial
an
issue
under
. . . judicial body.” § 415.16(e)(1), (2).
of
Kizilbash,
third
130
party
Cal.
12
was
App.
“in
4th
anticipation
1563,
1570
of
(2005)
1
anti-SLAPP
2
anticipation of [that] litigation,” his actions facially qualify as
3
protected activity under § 425.16.
statute—and
made
“communications
preparatory
to
or
in
4
However, Plaintiffs argue that Defendant’s conduct is not
5
protected activity under § 425.16 because it constitutes illegal theft
6
and theft of trade secrets under Cal. Penal Code §§ 484, 499c, and
7
illegal criminal activity is not protected by the anti-SLAPP statute.
8
(Pls.’ Opp’n 8:1—10:4.) Defendant counters that he did not engage in any
9
illegal activity, and addresses Plaintiffs’ factual illegality arguments
10
in turn. (Def.’s Reply in Supp. of Mot. to Strike (“Def.’s Reply”) ECF
11
No. 28, 10:3—14:26 (contending that Defendant regularly downloaded an
12
allegedly confidential document called Page 13 as part of his job, that
13
his visit to the website topclassactions.com was neither illegal nor
14
surprising,
15
Plaintiffs did not attempt to maintain the secrecy of Page 13).)
that
he
never
illegally
received
Page
13,
and
that
16
By its very terms, the anti-SLAPP statute protects only “the
17
valid exercise of the constitutional rights of freedom of speech and
18
petition.” Cal. Civ. Proc. Code § 425.16(a); Flatley, 39 Cal. 4th at 313
19
(recognizing
20
statement. . . not all speech or petition activity is protected by
21
section 425.16.” Flatley, 39 Cal. 4th at 313. If “either the defendant
22
concedes, or the [uncontroverted] evidence conclusively establishes,
23
that the assertedly protected speech or petition activity was illegal as
24
a matter of law, the defendant is precluded from using the anti-SLAPP
25
statute to strike the plaintiff’s action.” Id. at 320. However, there is
26
no
27
illegally, but instead strenuously opposes Plaintiffs’ arguments about
28
the illegality of his conduct. (See Def.’s Reply 10:3—14:26.) Nor has it
such
the
showing
same).
here.
“As
a
Defendant
13
necessary
does
not
corollary
concede
that
to
he
this
acted
1
been established with “uncontroverted and conclusive evidence” that
2
Defendant engaged in illegal theft and theft of trade secrets. Flatley,
3
39 Cal. 4th at 320.7 Since “there is a factual dispute as to the
4
illegality of [D]efendant’s conduct, [] the court cannot conclude that
5
the conduct was illegal as a matter of law.” Fremont Reorganizing Corp.
6
v. Faigin, 198 Cal. App. 4th 1153, 1168 (2011); see also Flatley, 39
7
Cal. 4th at 316. Accordingly, Defendant has established the first
8
portion of his threshold showing.
9
2. Arising From
10
Under the second portion of his threshold showing, Defendant
11
argues Plaintiffs’ lawsuit “arises from” his protected activity under §
12
425.16 since Plaintiffs: (1) filed this action one week after Defendant
13
helped initiate the class action, (Clark Decl. ¶¶ 4, 8 & Ex. A); (2)
14
offered to dismiss this action if Defendant supplied Plaintiffs with the
15
information provided to class counsel by Defendant and Plaintiffs’
16
current and former employees, (Carichoff Decl., ECF No. 14—5, ¶ 6 & Ex.
17
F); (3) stated that Defendant “improperly used and misrepresented our
18
confidential information to instigate these [class action] lawsuits,”
19
(Suppl. Carichoff Decl., ECF No. 28, ¶ 2 & Ex. G); and (4) referenced
20
expenses defending against the class action as damages in this action.
21
(Topel Decl., ECF No. 25, ¶ 12.) Plaintiffs counter that their claims do
22
not “arise from” Defendant’s protected activity since “protected speech
23
is
not
the
gravamen
of
the
claims,”
which
are
instead
based
on
24
7
25
26
27
28
For example, whereas Plaintiffs submit evidence that Defendant
gave a copy of Page 13 to class counsel, (Topel Decl., ECF No. 25, ¶ 11)
and aver that Plaintiffs attempted to protect the secrecy of Page 13
(Skinner Decl., ECF No. 21, ¶ 4), Defendant submits evidence that Page
13 was not reasonably protected as confidential or trade secret
information (Supp. Clark Decl. ¶ 11, ECF No. 28-2), and argues he was
entitled to supply Page 13 to class counsel because he believed
Plaintiffs’ actions violated California law. (Def.’s Reply 13:22—14:26.)
14
1
Defendant’s “(a) misappropriating [Plaintiffs’] beer specifications
2
document; (b) wrongfully obtaining the beer specifications document from
3
[a current employee] after leaving [the Company]; (c) providing that
4
document to [class counsel]; and, (d) refusing to sign the certification
5
required by the Confidentiality Agreements.” (Pls.’ Opp’n 10:21—25.)
6
To sustain the second portion of his threshold showing,
7
Defendant must demonstrate that Plaintiffs’ claims “arise from” his
8
protected
9
consideration” in § 425.16 “arising from” determinations is whether a
10
claim “is based on the defendant’s protected free speech or petitioning
11
activity.” Id. (emphasis added); Briggs, 19 Cal. 4th at 1114 (equating
12
“arising from” and “based upon” in this context). When a claim involves
13
both
14
Plaintiffs’ claims do, the “principal thrust or gravamen” of each claim
15
determines whether the anti-SLAPP statute applies. Club Members for an
16
Honest Election v. Sierra Club, 45 Cal. 4th 309, 319 (2008); accord In
17
re Episcopal Church Cases, 45 Cal. 4th at 477 (applying “the gravamen or
18
principal thrust” test in “arising from” determination). The fact that
19
Plaintiffs’ claims were “filed after” or “triggered by” Defendant’s
20
protected action is insufficient to demonstrate that Plaintiffs’ claims
21
“arose from” Defendant’s protected activity. Navellier, 29 Cal. 4th at
22
89. Nor is it enough for Plaintiffs’ claims to be “in response to” or
23
“in retaliation for” Defendant’s protected activity. City of Cotati, 29
24
Cal. 4th at 78; see also Navellier, 29 Cal. 4th at 90 (finding claims
25
“arose from” defendant’s protected activity since “but for [defendant’s
26
protected litigation], plaintiffs’ present claims would have no basis”).
27
Here, Defendant presents evidence that Plaintiffs filed this
28
action because of Defendant’s protected activity. However, Plaintiffs’
activity.
protected
and
Navellier,
29
nonprotected
15
Cal.
4th
activity,
at
as
89.
The
“critical
Defendant
argues
1
“subjective intent . . . is not relevant under the anti-SLAPP statute.”
2
City of Cotati, 29 Cal. 4th at 78. Even an “oppressive” claim filed “in
3
retaliation for . . . litigation is not subject to the anti-SLAPP
4
statute simply” for that reason. Id. Accordingly, Defendant’s evidence
5
of Plaintiffs’ motivation does not establish that Plaintiffs’ claims
6
arose from Defendant’s protected activity. See In re Episcopal Church
7
Cases, 45 Cal. 4th at 478 (“The . . . fact that protected activity may
8
lurk in the background—and may explain why the rift between the parties
9
arose in the first place—does not transform a . . . dispute into a SLAPP
10
suit.”).
11
Nor
is
Defendant’s
argument
persuasive
that
in
similar
12
contexts
13
Plaintiffs’ argument that their claims are premised on Defendant’s
14
nonprotected misappropriation and breach of contract, not on Defendant’s
15
protected litigation activity. (See Def.’s Reply 9:14—24 (citing Fox
16
Searchlight Pictures, Inc. v. Paladino, 89 Cal. App. 4th 294, 304-08
17
(2001)).) In Fox Searchlight, on which Defendant relies, former in-house
18
counsel for Fox sued Fox for wrongful termination, and Fox sued the
19
former counsel for disclosing confidential information in the course of
20
prosecuting the wrongful termination action. Id. at 298—99. The court
21
held that “in—house counsel may disclose ostensible employer—client
22
confidences to her own attorneys to the extent they may be relevant to
23
the preparation and prosecution of her wrongful termination action
24
against her former client—employer.” Id. at 310. Defendant’s argument
25
here depends on “[d]ictum in Fox Searchlight suggest[ing that] ‘a
26
plaintiff cannot frustrate the purposes of the SLAPP statute through a
27
pleading tactic of combining allegations of protected and nonprotected
28
activity
California
under
the
appellate
label
of
courts
one
16
cause
have
of
“expressly
action.’”
rejected”
Martinez
v.
1
Metabolife Int’l, Inc., 113 Cal. App. 4th 181, 188 (2003) (quoting Fox
2
Searchlight, 89 Cal. App. 4th at 308)). However, Fox Searchlight was
3
issued before the California Supreme Court explained the statute’s “not
4
always easily met” requirement that a SLAPP must itself be “based on”
5
Defendant’s protected activity, Equilon Enters., 29 Cal. 4th at 66, and
6
it resulted in a “specific and limited” holding confined to the in—house
7
counsel and wrongful termination context. Castleman v. Sagaser, 216 Cal.
8
App. 4th 481, 501 (2013). Defendant “cannot take advantage of the
9
anti-SLAPP statute simply because the complaint [or submitted evidence]
10
contains
11
[D]efendant.” Martinez, 113 Cal. App. 4th at 188.
12
some
references
to
speech
or
petitioning
activity
by
In this case, Defendant’s protected activity, unmentioned in
13
the
14
nonprotected wrongdoing, is “merely incidental” to each of Plaintiffs’
15
claims, making Plaintiffs claims beyond the scope of the anti-SLAPP
16
motion to strike. See Peregrine Funding, Inc. v. Sheppard Mullin, 133
17
Cal. App. 4th 658, 672 (2005) (describing the “apparently unanimous
18
conclusion of published [California] appellate cases” that the anti-
19
SLAPP
20
activity); see also
21
this test); M.F. Farming, Co. v. Couch Distrib. Co., 207 Cal. App. 4th
22
180, 197 (2012) (collecting cases employing the “merely incidental”
23
test);
24
(defining an incidental act as an “act [that] is not alleged to be the
25
basis
26
“breach[ed]
27
confidential information” stand alone, (Pls.’ Opp’n 10:19—21), stating
28
a claim for breach of contract and misappropriation of trade secrets
complaint
statute
Wallace
for
and
is
v.
referenced
inapplicable
to
as
evidence
“merely
of
Defendant’s
incidental”
protected
Mindys Cosmetics, Inc., 611 F.3d at 598 (applying
McCubbin,
liability”).
his
only
196
Here,
Confidentiality
Cal.
App.
Plaintiffs’
Agreements
17
4th
1169,
claims
and
1183
that
(2011)
Defendant
misappropriat[ed]
1
without reference to Defendant’s protected litigation. Since Defendant’s
2
“activity that gives rise to his [] asserted liability” does not
3
constitute “protected speech or petitioning,” Plaintiffs’ claims are
4
outside the “definitional focus” of the anti-SLAPP statute. Navellier,
5
29 Cal. 4th at 92. Accordingly, Defendant has not shown that Plaintiffs’
6
claims arise from his protected activity, and Defendant’s special motion
7
to strike Plaintiffs’ claims is denied.
8
III. CONCLUSION
9
For
the
stated
reasons,
Plaintiffs’
return
of
personal
10
property claim is dismissed with prejudice. Defendant’s anti-SLAPP
11
motion is denied.
12
Dated:
July 18, 2013
13
14
15
GARLAND E. BURRELL, JR.
Senior United States District Judge
16
17
18
19
20
21
22
23
24
25
26
27
28
18
Disclaimer: Justia Dockets & Filings provides public litigation records from the federal appellate and district courts. These filings and docket sheets should not be considered findings of fact or liability, nor do they necessarily reflect the view of Justia.
Why Is My Information Online?