| California Legislature Amends Anti-SLAPP Statute Again
By Rochelle L. Wilcox
[Fall 2005]
On Oct. 5, 2005, California’s governor signed Assembly Bill 1158 ("AB 1158"), adopting California Code of Civil Procedure § 425.18 to amend the scope of California ’s anti-SLAPP statute. The anti-SLAPP statute permits a litigation defendant to obtain early dismissal of lawsuits that challenge defendant’s rights of petition or speech about public issues, and requires the plaintiff who files such a suit to reimburse defendant’s attorneys’ fees and costs in pursuing the anti-SLAPP motion. AB 1158 was designated emergency legislation, taking effect immediately. Like previous amendments to the anti-SLAPP statute, this bill was adopted in response to a string of cases presenting a new and unexpected issue: whether a lawsuit by a defendant who prevails on an anti-SLAPP motion and then sues plaintiff for malicious prosecution (a "SLAPPback" action) is itself subject to an anti-SLAPP motion. As discussed below, the Legislature has created new limits on the use of the anti-SLAPP statute, in its attempt to ensure that the statute is used only to protect the public’s rights of petition and free speech in connection with public issues, furthering the underlying legislative intent.
The Legislature also took the opportunity to overrule two cases which had held that the requirement that an anti-SLAPP motion be noticed for hearing within 30 days was jurisdictional, providing further protection for those who rely on the anti-SLAPP statute.
A "SLAPPback" now is treated differently from other lawsuits
In a number of cases over the past few years, a litigation defendant who prevailed on an anti-SLAPP motion followed that victory with a lawsuit for malicious prosecution against the unsuccessful plaintiff in the initial suit (a "SLAPPback" suit). The malicious prosecution defendant (the unsuccessful plaintiff in the prior suit) would respond with its own anti-SLAPP motion, claiming that the malicious prosecution action was itself an improper attempt to punish the unsuccessful plaintiff in the first suit from pursuing its right of petition.
Critics claimed that permitting an anti-SLAPP motion in the malicious prosecution action was an abuse of the anti-SLAPP statute and exposed the malicious prosecution plaintiff to an unwarranted risk merely for pursuing his or her right to recover damages incurred in the first litigation (which already had been adjudicated to be a SLAPP suit). The California Legislature agreed and adopted AB 1158 (now Code of Civil Procedure § 425.18) as emergency legislation to protect the right of the malicious prosecution plaintiff to pursue that claim. The new statute expresses this legislative intent:
The Legislature finds and declares that a SLAPPback is distinguishable in character and origin from the ordinary malicious prosecution action. The Legislature further finds and declares that a SLAPPback cause of action should be treated differently, as provided in this section, from an ordinary malicious prosecution action because a SLAPPback is consistent with the Legislature’s intent to protect the valid exercise of the constitutional rights of free speech and petition by its deterrent effect on SLAPP (strategic lawsuit against public participation) litigation and by its restoration of public confidence in participatory democracy.
Cal . Code Civ. Proc. § 425.18(a) (emphasis added). The statute then defines the "SLAPPback":
"SLAPPback" means any cause of action for malicious prosecution or abuse of process arising from the filing or maintenance of a prior cause of action that has been dismissed pursuant to a special motion to strike under Section 425.16.
Id. § 425.18(b)(1).
Section 425.18 makes certain anti-SLAPP provisions inapplicable to a motion to strike a SLAPPback lawsuit. In particular, Section 425.18(c) provides that "[t]he [anti-SLAPP statute’s] provisions of subdivisions (c), (f), (g), and (i) of Section 425.16, and paragraph (13) of subdivision (a) of Section 904.1, shall not apply to a special motion to strike a SLAPPback." These subdivisions contain some of the anti-SLAPP statute’s most potent weapons:
- Section 425.16(c) provides for a mandatory award of attorneys’ fees and costs to any defendant prevailing on an anti-SLAPP motion. A plaintiff who defeats an anti-SLAPP motion is entitled to recover its attorneys fees and costs only if the court finds that the motion "is frivolous or is solely intended to cause unnecessary delay."
- Section 425.16(f) provides that the motion must be filed within 60 days of service of the complaint or, in the court’s discretion, at a later date, and it must be heard within 30 days of service of the motion "unless the docket conditions of the court require a later hearing."
- Section 425.16(g) provides for an immediate stay of all discovery in the action unless the court "on noticed motion and for good cause shown" permits "specified discovery."
- Sections 425.16(i) and 904.1(13) permit the immediate appeal of an order granting or denying an anti-SLAPP motion.
In their place, the Legislature has established new procedures and rules to govern a motion filed against a SLAPPback:
- Section 425.18(f) removes the defendant’s right to recover its attorneys’ fees and costs following a successful anti-SLAPP motion. It mandates an award of attorneys’ fees and costs to plaintiff if the motion "is frivolous or solely intended to cause unnecessary delay."
- Section 425.18(d) provides that the motion must be filed within 120 days of service of the complaint, within six months in the court’s discretion or, if defendant is not at fault and if the court finds extraordinary circumstances, at any later time.
- Section 425.18(e) permits a party faced with an anti-SLAPP motion to file an ex parte application to continue the motion to conduct necessary discovery.
- Section 425.18(g) permits the losing party to file a peremptory writ—asking the Court of Appeal to exercise its discretion to review the order— within 20 days of service of written notice of entry of the order granting or denying the anti-SLAPP motion.
In addition to these procedural changes, the Legislature imposed an entirely new limit on use of the anti-SLAPP motion in a SLAPPback:
A special motion to strike may not be filed against a SLAPPback by a party whose filing or maintenance of the prior cause of action from which the SLAPPback arises was illegal as a matter of law.
Id. § 425.18(h).
This subsection is an important restriction on the use of an anti-SLAPP motion to defeat a SLAPPback. As explained by the Legislature in the Senate Judiciary Committee’s Final Analysis, this provision is premised on the fact that "baseless litigation is not immunized by the First Amendment right to petition." Bill Analysis, AB 1158 (2004-2005 Session), Senate Judiciary Committee, August 15, 2005, p. 11 (citing Bill Johnson’s Restaurants, Inc. v. National Labor Relations Board, 461 U.S. 731 (1983).) The Legislature explained:
Thus, where a person whose prior SLAPP lawsuit was illegal as a matter of law, as shown by being thrown out on a special motion to strike, and the SLAPP victim files a subsequent malicious prosecution action, that bad actor cannot use the anti-SLAPP law to defend against the lawsuit or to vex and harass the SLAPP victim.
Id. at 12.
Prior California Supreme Court cases had limited the rights of SLAPP defendants
The California Supreme Court set the stage for ongoing SLAPPback litigation in Jarrow Formulas Inc. v. LaMarche, 31 Cal. 4th 728 (2003), where it held that an anti-SLAPP motion could be used to defend against a malicious prosecution action. In that case, the underlying lawsuit was not a SLAPP; rather, it was resolved on summary judgment. Id. at 732. Nonetheless, Jarrow made clear that an anti-SLAPP motion was available in all malicious prosecution actions, and consequently that an anti-SLAPP motion also would be available to challenge a malicious prosecution action based on a prior SLAPP. The Court explained:
The anti-SLAPP statute is not ambiguous with respect to whether its protection of "any act" furthering protected rights encompasses suing for malicious prosecution. As we previously have observed, "[n]othing in the statute itself categorically excludes any particular type of action from its operation."
Id. at 735 (citation omitted). The Court also found that legislative history supported its construction of the statute as applying to all types of actions, without limitation. Id. at 736. Finally, the Court rejected Jarrow’s claim that anti-SLAPP motions should not be available in malicious prosecution actions because the underlying case is not legal petitioning activity. Id. at 739. The Court explained:
We already have, in another context, considered and rejected Jarrow’s "validity" argument, noting it "‘confuses the threshold question of whether the SLAPP statute [potentially] applies with the question whether [an opposing plaintiff] has established a probability of success on the merits.’"
Id. at 739-740.
A case decided by the Supreme Court a year earlier also addressed malicious prosecution actions in the anti-SLAPP context. In Wilson v. Parker, Covert & Childester, 28 Cal. 4th 811 (2002), the Supreme Court held that denial of an anti-SLAPP motion by a trial court could be used adversely in a subsequent malicious prosecution suit—even if the trial court’s decision had been reversed on appeal—if the trial court’s decision was based on a conclusion that the case had probable merit. Id. at 815. The Court explained that prior caselaw in other contexts, such as summary judgment motions, established this principle. Id. at 817-819. The Court explained the reasoning underlying this rule:
The rights of litigants and attorneys to bring nonfrivolous civil actions, "’even if it is extremely unlikely that they will win’"..., would be unduly burdened were they exposed to tort liability for malicious prosecution for actions that had been found potentially meritorious under section 425.16.
Id. at 820 (citation omitted). Because one judge found the action to be potentially meritorious, the court concluded that as a matter of law a reasonable attorney could reach that conclusion. Id. at 819.
The Legislature disagreed with both of these decisions, at least in part. The final report of the Senate Judiciary Committee, as amended Aug. 15, 2005, explains:
The sponsor, the California Anti-SLAPP Project (CASP), and proponents assert that victims of SLAPP lawsuits suffer great damages as a result of being SLAPPed, and that the costs and attorneys’ fees recoverable under the anti-SLAPP law are only a small part of the overall damages suffered by a SLAPP victim. CASP points out that some victim’s lives have been literally destroyed by having to defend against a SLAPP. Some have lost or had to mortgage their homes to pay the upfront defense costs, and many have suffered severe emotional distress, adverse health consequences, and strained family relationships caused by SLAPP-related stress. Writes CASP: "Frequently, much more significant are damages for emotional distress and punitive damages, arising from violations of the defendant’s constitutional rights. Attorneys’ fees and costs will not compensate."
This bill will enhance the ability of SLAPP victims to recover damages for being SLAPPed in two major ways. First, it would narrowly abrogate a part of the Supreme Court decision in Wilson v. Parker, Covert & Childester, (2002) 28 Cal.4th 811, in which the Court narrowly construed legislative intent and declined to bar the denial of an anti-SLAPP motion from having an adverse effect in a later action. That ruling effectively bars many SLAPP victims from filing a SLAPPback action even though that prior denial of the motion by the trial court was overturned on appeal. The proposed limited abrogation would allow those SLAPP victims to file a SLAPPback claim.
(See Comment 3.) A second major provision would enact new Section 425.18 to govern SLAPPback actions to specifically ameliorate some of the potential harshness of the anti-SLAPP law if applied to a SLAPPback action. (See Comments 2, 4, and 5.)
Bill Analysis, AB 1158 (2004-2005 Session), Senate Judiciary Committee, August 15, 2005, pp. 6-7.
The Legislature did not, however, abrogate Jarrow in its entirety. The Senate rejected an early version of AB 1158 that would have done so, explaining that it "could result in cases of first impression where the ‘little-guy’ plaintiff was truly not engaging in SLAPP litigation, but is nonetheless found to be a SLAPPer." Id. at 15. The Legislature wanted to preserve the "little-guy" plaintiff’s opportunity to use the anti-SLAPP law to defend against a SLAPPback. In addition, the Legislature echoed the Supreme Court’s observation in Jarrow that "spurious malicious prosecution suits may, like others, chill the valid exercise of the constitutional rights of freedom of speech and petition for the redress of grievances." Id. (citation, internal quotes omitted). Thus, the Legislature ultimately adopted a compromise "to continue allowing the filing of an anti-SLAPP motion in a SLAPPback but eliminating some of the risks to the SLAPPback filer if the motion succeeds." Id. at 16.
AB 1158 also overrules cases holding that the SLAPP subsection requiring a hearing to be noticed in 30 days is jurisdictional
In addition to remedying problems that had arisen in connection with SLAPPback lawsuits, the Legislature used the opportunity to overrule two Court of Appeal decisions that had limited use of the anti-SLAPP motion.
Section 425.16(f) previously provided that an anti-SLAPP motion "shall be noticed for hearing not more than 30 days after service unless the docket conditions of the court require a later hearing." Interpreting this subdivision, two Courts of Appeal had held that this limitation was jurisdictional, and the anti-SLAPP motion could not be heard if it was noticed for hearing outside of this time limitation for any reason other the court’s docket conditions. Decker v. U.D. Registry, Inc., 105 Cal. App. 4th 1382, 1387-1390 (2003); Fair Political Practices Comm’n v. American Civil Rights Coalition, Inc., 121 Cal. App. 4th 1171, 1174-1178 (2004). The Decker court asserted that this furthered the legislative goals underlying the anti-SLAPP statute:
[I]nterpreting "shall" in subdivision (f) of section 425.16 as mandatory advances the legislative purpose of requiring a prompt hearing on the motion so as not to prolong the discovery stay. Interpreting "shall" in subdivision (f) as mandatory also advances the legislative purpose of creating a prompt and efficient means for terminating claims improperly aimed at the exercise of free speech or the right of petition.
Id. at 1390.
The Legislature disagreed. It amended Section 425.16(f) to require the motion to "be scheduled by the clerk of the court for a hearing not more than 30 days after the service of the motion unless the docket conditions of the court require a later hearing." Lest its intent be lost in the arguably ambiguous language, the Legislature also included in AB 1158:
It is the intent of the Legislature, in amending subdivision (f) of Section 425.16 of the Code of Civil Procedure, to overrule the decisions in Decker v. U.D. Registry, Inc. (2003) 105 Cal.App.4th 1382, 1387-1390, and Fair Political Practices Commission v. American Civil Rights Coalition, Inc. (2004) 121 Cal.App.4th 1171, 1174-1178.
Assembly Bill 1158, Sec. 3. Now, it is the court clerk’s responsibility to attempt to schedule the hearing on the anti-SLAPP motion within 30 days, and the court will not lose jurisdiction over the motion if that requirement is not met. Thus, the Legislature ensured that a SLAPP motion is not denied because of this procedural technicality.
Conclusion
The California Legislature has demonstrated its ongoing commitment to the policies underlying the anti-SLAPP statute by removing a barrier to SLAPP victims being fully compensated for having been subject to a SLAPP. Although AB 1158 limits the use of the SLAPP statute under certain circumstances, it does so only to protect the victims of the original SLAPP suit. The Legislature’s decision to overrule Decker and Fair Political Practices also demonstrates its commitment to the anti-SLAPP statute, and its determination that SLAPP motions be decided on their merits. Both parts of this bill are good news for SLAPP victims in California.
Other articles in the 2005 FALL Newsletter:
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About the author:
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Rochelle L. Wilcox, a litigation associate with DWT’s Los Angeles office, lives and works in Sacramento. Ms. Wilcox practices in the area of media law, including defamation, invasion of privacy, newsgathering torts, access, and reporters’ shield laws. In addition, she practices appellate advocacy, employment litigation and general business litigation.
Rochelle can be reached at (213) 633-6883 or RochelleWilcox@dwt.com. |
This First Amendment Law Letter is a publication of the law firm of Davis Wright Tremaine LLP and is prepared by its Communications, Media and Information Technologies Department, Kelli L. Sager and Daniel M. Waggoner, co- chairs, Rochelle Wilcox, editor and Steve Chung, associate editor.
Our purpose in publishing this law letter is to inform our clients and friends of recent First Amendment and communications law developments. It is not intended, nor should it be used, as a substitute for specific legal advice since legal counsel may be given only in response to inquiries regarding particular factual situations.
Copyright © 2005, Davis Wright Tremaine LLP
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