Justice Stratton doesn't exactly pay lavish compliments to Loeb & Loeb -- or its attorneys -- in this opinion.
A guy (Sadlier) enters into an agreement with a company (Medallion Film) to help the company try to get some funding. The guy promises not to use any of the contacts the company gives him, but the company subsequently learns that the guy (allegedly) got some money for someone else from one of the contacts (BlackRock) the company provided. So the company sends an email to the contact (BlackRock) that says:
"Randy hope all is well. We have a fee agreement with Bill Sadle[i]r based upon monies raised from Blackrock thru my introduction to you. What can you do to assist us here in collecting what is due to us. Jesse [Kennedy, of Medallion] will provide a reconciliation. As you know our financial models were provided to you and Blackrock on the P&A. Let us know so we dont have to litigate and can resolve the matter in an amicable fashion. Thx.”
The guy subsequently gets wind of this email, and has his lawyers at Loeb & Loeb write a nastygram back that says: "Aviron has no legal connection to Clarius Capital Group, LLC whatsoever. It is not a successor in interest and there is no common ownership between the two companies. Mr. Sadleir, who signed the referenced agreement on behalf of Clarius Capital Group, is an Aviron employee with no ownership interest in Aviron. Had Mr. Sadleir left Clarius to work at Sony Pictures Entertainment, for example, your claim for payment to you by Sony, had it received funding from BlackRock, would be equally without merit. Any further communication by you to Randy Robertson or anyone else at BlackRock regarding this matter will be considered by Aviron to constitute tortious interference.”
But what the Loeb & Loeb partner said was (allegedly) totally untrue, and Loeb & Loeb (allegedly) knew it because they actually helped Sadleir create the successor company, and also represented that company when it got the cash from BlackRock. Thereafter, once the company discovered the truth behind these (alleged) lies, they sue Loeb & Loeb. Which responds with an anti-SLAPP motion that says that the lawsuit arose out of a protected pre-litigation communication and is absolutely privileged. The trial court agrees and dismisses the lawsuit.
The Court of Appeal reverses. Justice Stratton says that Loeb & Loeb's response was not, in fact, a communication in anticipation of litigation because the plaintiff's email was the opposite of a litigation threat; they were trying to get their piece of the pie cooperatively from a third party, without filing any lawsuit. So the lawsuit doesn't arise out of protected activity, and the anti-SLAPP statute doesn't apply. In the (quite direct) words of Justice Stratton:
"From the first sentence of its appellate brief, Loeb & Loeb repeatedly and hyperbolically describes the email to which Given responded as an explicit threat of litigation conclusively establishing Given’s letter as anticipating litigation. But the actual message to which Given was responding was nothing of the sort. This was not a demand letter or litigation threat, and it was not even directed to Aviron. Rather, plaintiffs reached out to their contact at BlackRock—the person to whom they had introduced Sadleir pursuant to the consulting agreement—and asked for BlackRock’s help in securing the payment to which they thought they were entitled: “What can you do to assist us here in collecting what is due to us[?]” They sought BlackRock’s help so the question of payment could be addressed informally, “so we don[’]t have to litigate and can resolve the matter in an amicable fashion.” The email demonstrates the plaintiffs just wanted to be paid, and they were appealing to whomever they thought would be influential in persuading Sadleir to pay them without having to resort to litigation. This is the exact opposite of a threat of litigation." (emphasis in original).
Since the anti-SLAPP statute doesn't apply, reversal of the dismissal is required.
And then the opinion then goes on to make it even worse for Loeb & Loeb.
Even though the Court of Appeal has already held in Part I that the anti-SLAPP statute doesn't apply, Justice Stratton then goes on in Part II to unnecessarily -- but dispositively -- reject every single one of Loeb & Loeb's defenses on the merits. ("While our conclusion that the causes of action asserted in the amended complaint arise from conduct that is not protected is determinative of this appeal, we discuss the second prong because even if Loeb & Loeb did carry its burden to make a prima facie showing that the claims alleged in the amended complaint arose from protected activity, the plaintiffs made the requisite showing of merit required by the statute to survive the special motion to strike. This is equally and independently sufficient to demonstrate the anti-SLAPP motion should have been denied.")
In the next pages, the Court of Appeal rejects their litigation privilege defense, their statute of limitations defense, and their reliance defense -- basically, every single defense they have to the entire lawsuit. Moreover, in doing so, Justice Stratton is occasionally less than exceptionally kind. (To take but one example, the Court of Appeal's rejection of the reliance defense begins by saying "In a rather bleak argument, Loeb & Loeb argues plaintiffs cannot prove they justifiably relied on Given’s representations because as a matter of law it was not justifiable to rely on the representations he made as counsel for Aviron.")
The net result of which is that Loeb & Loeb goes from winning the lawsuit below -- and getting their fees paid -- to not only having the dismissal (and fee award) reversed, but also to basically no longer having any chance of getting out of the lawsuit on summary judgment -- and perhaps not even at trial -- either.
That hurts.
My strong sense is that the Court of Appeal didn't like (at all) the way Loeb & Loeb handled this thing, either in the underlying dispute or on appeal. It's not surprising that the justices would not like a lawyer who (allegedly) deliberately lied in an email. But I also suspect they didn't particularly appreciate the one of Loeb & Loeb's response to the plaintiff's email to BlackRock either. (Here's how Justice Stratton characterizes that response: "Givens' bombastic and disproportionate response to an email not even directed to his client is not a communication made in good faith and serious contemplation of litigation but an attempt to dissuade the plaintiffs from making any further inquiries.")
Sometimes, atmospherics matter.
