Case Name: X. Young Lai v. Wen Fang Wang, et al.

Case No.: 17CV308093

(1) Defendant Frank S. Moore and Michelle Melen’s Special Motion to Strike First Amended Complaint
(2) Defendant Frank S. Moore and Michelle Melen’s Demurrer/Motion to Strike Plaintiff’s First Amended Complaint
(3) Defendant Wen Fang Wang’s Special Motion to Strike First Amended Complaint
(4) Defendant Wen Fang Wang’s Demurrer/Motion to Strike Plaintiff’s First Amended Complaint

Factual and Procedural Background

In or about June 2016, defendant Wen Fang Wang (“Wang”) approached plaintiff X. Young Lai (“Lai”) for legal representation in her divorce case. (First Amended Complaint (“FAC”), ¶8.) With respect to her financial condition, defendant Wang represented to plaintiff Lai that (1) she received no distribution of assets before separation; (2) she has no funds to retain an attorney for her divorce; (3) she was in arrears of her rent and had insufficient funds to buy food. (FAC, ¶9.) Defendant Wang knew these representations to be false when made and the representations were intended to induce plaintiff Lai to perform legal services for defendant Wang at no cost. (FAC, ¶10.)

In reliance on the representations, plaintiff Lai entered into a retainer agreement with defendant Wang whereby plaintiff Lai would request an order for attorney’s fees in defendant Wang’s divorce case claiming financial hardship. (FAC, ¶12.) In further reliance, plaintiff Lai advanced legal fees on defendant Wang’s behalf and performed substantial services for defendant Wang without receiving adequate compensation. (FAC, ¶13.)

The retainer agreement states, in pertinent part, “If we elect to terminate our representation … In such case, you agree to pay for all legal services performed and expenses incurred before the termination of representation in accordance with the provision of this agreement.” (FAC, ¶18.) After plaintiff Lai terminated the retainer agreement in late January 2017, defendant Wang became liable for attorney’s fees and costs in the amount of $25,776.43 but breached the agreement by failing or refusing to pay. (FAC, ¶¶19 – 20.)

Defendant Michelle Ann Melen (“Melen”) substituted plaintiff Lai as defendant Wang’s counsel in the divorce case in February 2017. (FAC, ¶25.) Plaintiff Lai originally commenced the instant action against defendant Wang in April 2017. (FAC, ¶26.) In May 2017, defendant Wang filed a malicious and false State Bar complaint against plaintiff Lai. (FAC, ¶26.) Wang evaded service of the instant action until October 2017. (FAC, ¶27.) Defendant Melen knowingly gave substantial assistance to defendant Wang in evading process and instituting a false State Bar complaint. (FAC, ¶30.)

Defendant Melen filed a petition for non-binding fee arbitration. (FAC, ¶28.) To circumvent the statute of limitations, defendant Wang made a false declaration that she never received notice of the right to arbitrate even though she received such notice nine months ago. (FAC, ¶29.) On November 21, 2017, defendant Melen filed a stay of the instant action. (FAC, ¶31.)

On December 5, 2017, in support of defendant Wang’s request for attorney’s fees in the divorce action, defendants Wang and Melen presented declarations in the divorce action that plaintiff Lai was owed attorney’s fees and costs in the amount of $25,776.43. (FAC, ¶31.) Defendants Wang and Melen intentionally concealed from the family court the fact that defendant Wang was disputing plaintiff Lai’s fees and had filed a petition for fee arbitration. (FAC, ¶32.)

In March 2018, defendant Frank Scott Moore (“Moore”) substituted defendant Melen as defendant Wang’s counsel in the fee arbitration. (FAC, ¶34.) Defendant Moore presented a claim of legal malpractice which was outside the scope of the fee arbitration. (FAC, ¶36.) Defendant Moore knowingly misrepresented the transcript of the family court hearing and intentionally presented a falsified document manufactured by defendant Wang to the panel or arbitrators. (FAC, ¶37.) Defendants Moore and Melen intentionally concealed the falsity of the document by carefully redacting exhibits which would have exposed the falsity and made false statements to make the document more deceptive. (FAC, ¶38.) Rather than rectify the fraud, defendants dismissed the fee arbitration in October 2018. (FAC, ¶39.) The forged document and intentional misrepresentations were not designed to settle a fee dispute but to delay resolution of the instant action, to burden plaintiff Lai financially, to harass plaintiff Lai, and to pressure plaintiff Lai to give up valid claims. (FAC, ¶43.)

On April 3, 2017, plaintiff Lai filed a complaint against defendant Wang. As noted above, defendant Wang filed a notice of stay based on the fee arbitration. At an October 25, 2018 case status review, counsel informed the court that the matter would not proceed to arbitration and the court lifted the stay.

On December 3, 2018, defendant Wang filed a demurrer/ motion to strike plaintiff Lai’s complaint.

On January 14, 2019, plaintiff Lai filed the operative FAC and a Doe amendment substituting defendants Melen and Moore for Doe defendants. The FAC asserts causes of action for:

(1) Fraud
(2) Breach of Contract
(3) Common Counts
(4) Malicious Prosecution
(5) Abuse of Process
(6) Conspiracy

On January 25, 2019, defendants Moore and Melen filed two of the four motions now before the court: (1) a special motion to strike the FAC; and (2) a demurrer/ motion to strike the FAC.

Also on January 25, 2019, defendant Wang filed the other two motions now before the court: (1) a special motion to strike the FAC; and (2) a demurrer/ motion to strike the FAC.

For judicial economy, all four motions are being heard together.

I. Defendants Moore and Melen’s special motion to strike the FAC is GRANTED.

A. Procedural issues.

In opposition, plaintiff Lai argues initially that defendants Moore and Melen’s special motion to strike is procedurally defective in that it fails to comply with Code of Civil Procedure section 425.16, subdivision (f) which states, “The motion shall 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.” Defendants Moore and Melen filed and served the instant special motion to strike on January 25, 2019, but the hearing date was scheduled for May 7, 2019, more than 30 days after service of the motion. “[A] defendant who files an anti-SLAPP motion and does not obtain a hearing within 30 days after service of the motion bears the burden of showing that the condition of the court’s docket required a later hearing. [Citation.]” (Barak v. The Quisenberry Law Firm (2006) 135 Cal.App.4th 654, 659.) Plaintiff notes the absence of any declaration from defendants’ counsel explaining why this court’s docket required a later hearing. The court anticipates defendants will provide the requisite declaration in reply. Even if defendants do not provide such a declaration, the court is keenly aware and takes judicial notice of its own docket. Current docket conditions are unable to accommodate scheduling any motion within 30 days absent a court order. The court will not deny defendants’ motion for this procedural defect.

Plaintiff Lai argues additionally that defendants failed to comply with Code of Civil Procedure section 435.5, subdivision (a) which states, “Before filing a motion to strike pursuant to this chapter, the moving party shall meet and confer in person or by telephone with the party who filed the pleading that is subject to the motion to strike for the purpose of determining if an agreement can be reached that resolves the objections to be raised in the motion to strike.” Plaintiff Lai overlooks subdivision (d)(3) of that same section which states, “This section does not apply to … A special motion brought pursuant to Section 425.16.” Under this plain language, a meet and confer is not required as the instant motion is a special motion to strike brought pursuant to Code of Civil Procedure section 425.16.

B. The two-step procedure for anti-SLAPP motions.

Code of Civil Procedure section 425.16 requires a court to engage in a two-step process when determining whether a defendant’s anti-SLAPP motion should be granted. First, the court decides whether the defendant has made a threshold showing that the challenged cause of action is one “arising from” protected activity. The moving defendant’s burden is to demonstrate that the act or acts of which the plaintiff complains were taken in furtherance of the defendant’s right of petition or free speech under the United States or California Constitution in connection with a public issue. If the court finds such a showing has been made, it then must consider whether the plaintiff has demonstrated a probability of prevailing on the claim. In making these determinations, the trial court considers the pleadings, and supporting and opposing affidavits stating the facts upon which the liability or defense is based. (Equilon Enterprises v. Consumer Cause, Inc. (2002) 29 Cal.4th 53, 67.)

C. Step one – threshold showing that the challenged cause of action arises from protected activity.

Defendants Moore and Melen have the initial burden to demonstrate that the claims asserted against them by plaintiff Lai in the FAC “arise from” some protected activity. “Defendant need only make a prima facie showing that plaintiff’s complaint ‘arises from’ defendant’s constitutionally-protected free speech or petition activity. The burden shifts to plaintiff to establish as a matter of law that no such protection exists.” (Weil & Brown, et al., CAL. PRAC. GUIDE: CIV. PRO. BEFORE TRIAL (The Rutter Group 2015) ¶7:991, pp. 7(II)-54 to 7(II)-55 citing Governor Gray Davis Committee v. American Taxpayers Alliance (2002) 102 Cal.App.4th 449, 458 – 459.)

“A defendant meets the burden of showing that a plaintiff’s action arises from a protected activity by showing that the acts underlying the plaintiff’s cause of action fall within one of the four categories of conduct described in section 425.16, subdivision (e). [Citation.] Those four categories are: ‘(1) any written or oral statement or writing made before a legislative, executive, or judicial proceeding, or any other official proceeding authorized by law; (2) any written or oral statement or writing made in connection with an issue under consideration or review by a legislative, executive, or judicial body, or any other official proceeding authorized by law; (3) any written or oral statement or writing made in a place open to the public or a public forum in connection with an issue of public interest; (4) or any other conduct in furtherance of the exercise of the constitutional right of petition or the constitutional right of free speech in connection with a public issue or an issue of public interest.’” (Siam v. Kizilbash (2005) 130 Cal.App.4th 1563, 1569 (Siam).)

The first three causes of action [fraud/ breach of contract/ common counts] appear to be directed at defendant Wang only. Only the fourth through sixth causes of action appear to be directed at defendants Moore and Melen. The relevant allegations against defendants Moore and Melen include the following: “Attorney Melen then filed a petition for non-binding fee arbitration …;” “Attorney Melen knowingly gave substantial assistance to Wang, aiding and abetting her in evading process and instituting the false bar complaint;” “Attorney Melen … presented [a] declaration[] to the family court that Plaintiff was owed attorney’s fees and costs in the amount of $25,776.43 [but concealed] from the family court the fact that Wang was disputing the fees and filing a fee arbitration;” “[Melen] intentionally conceal[ed] from the panel arbitrators the fact that the invoices were represented to the family court disguised as an undisputed debt…;” “Attorney Moore in his two briefs and accompanying documentation presented, among other things, a claim of legal malpractice, which again, was outside the scope of the fee arbitration;” “Attorney Moore then knowingly misrepresented the transcript of the family court hearing, and … intentionally presented a falsified document manufactured by Wang to the panel of arbitrators;” “both Attorney Moore and Melen intentionally concealed the falsity of the document, by carefully redacting other exhibits which would have to expose that falsity. Furthermore they intentionally made false statements purporting to make the document more deceptive;” “defendants refused to rectify the fraud, deception, and forgery, which has been imposed upon the family court, panel of fee arbitrators, and Plaintiff.” (FAC, ¶¶28, 30, 31, 32, 36, 37, 38, 39.)

Based principally upon these allegations, plaintiff Lai asserts a claim for malicious prosecution and abuse of process against defendants Moore and Melen. Plaintiff’s sixth cause of action is for civil conspiracy. “Conspiracy is not a cause of action, but a legal doctrine that imposes liability on persons who, although not actually committing a tort themselves, share with the immediate tortfeasors a common plan or design in its perpetration.” (Applied Equipment Corp. v. Litton Saudi Arabia Ltd. (1994) 7 Cal.4th 503, 510 – 511 (Applied); see also Quelimane Co. v. Stewart Title Guaranty Co. (1998) 19 Cal.4th 26, 47; see also CACI, No. 3600.) Plaintiff Lai’s sixth cause of action asserts civil conspiracy, apparently as a means for holding defendants Moore and Melen liable for the malicious prosecution and abuse of process causes of action.

Because every malicious-prosecution action is predicated on the filing of an earlier civil action or petition, “it is settled that a claim for malicious prosecution is subject to a special motion to strike under Cal. Civ. Proc. Code § 425.16.” (Jarrow Formulas Inc., supra, 31 Cal. 4th at 734–735, 3 Cal. Rptr. 3d at 636 [citing to other states’ use of anti-SLAPP statutes against malicious-prosecution claims].) Daniels v. Robbins, 182 Cal. App. 4th 204, 215, 105 Cal. Rptr. 3d 683 (4th Dist. 2010) (“[t]he plain language of the anti-SLAPP statute dictates that every claim of malicious prosecution is a cause of action arising from protected activity because every such claim necessarily depends upon written and oral statements in a prior judicial proceeding”).

…

Any plaintiff filing a malicious-prosecution action (or a claim for abuse of process) must be prepared to face an anti-SLAPP motion. (See Chavez v. Mendoza, 94 Cal. App. 4th 1083, 1089, 114 Cal. Rptr. 2d 825 (4th Dist. 2001) [subjecting malicious-prosecution actions to Civ. Proc. Code § 425.16 “will not prevent valid malicious-prosecution claims but will require a plaintiff bringing this claim to demonstrate early on that the complaint is supported by a sufficient prima facie showing of facts to sustain a favorable judgment … consistent with the disfavored nature of the malicious-prosecution tort, and the view that such claims are too frequently used as a dilatory and harassing device.”].)

For the same reasons, abuse-of-process claims are also subject to an anti-SLAPP motion. (Rusheen v. Cohen, 37 Cal. 4th 1048, 1056–1057, 39 Cal. Rptr. 3d 516, 128 P.3d 713 (2006); Booker v. Rountree, 155 Cal. App. 4th 1366, 66 Cal. Rptr. 3d 733 (4th Dist. 2007) [“the gravamen of the [abuse of process] claim is misconduct in the underlying litigation. … [I]t is hard to imagine an abuse of process claim that would not fall under the protection of the [anti-SLAPP] statute.”].)

(Burke, CAL. PRAC. GUIDE: ANTI-SLAPP LITIGATION (The Rutter Group 2018) §§3:46 – 3:47.)

In opposition, plaintiff Lai contends anti-SLAPP protection is not afforded to illegal activity. Plaintiff Lai contends defendants Moore and Melen’s underlying actions were illegal. “[W]hen a defendant’s speech or petition activity upon which the defendant relies to support a section 425.16 special motion to strike is conceded or shown to be illegal as a matter of law, such speech or petition activity will not support the special motion to strike.” (Cohen v. Brown (2009) 173 Cal.App.4th 302, 317 (Cohen).)

It is well settled that extortion is not constitutionally protected speech and thus cannot constitute the “valid” exercise of speech and petition that is protected by section 425.16. (Flatley, supra, 39 Cal.4th at p. 328, 46 Cal.Rptr.3d 606, 139 P.3d 2.) In Flatley, the court, after discussing the character of the crime of extortion, observed that “[a]ttorneys are not exempt from these principles in their professional conduct” and cited rule 5–100 of the California Rules of Professional Conduct. (Id. at pp. 326–327, 46 Cal.Rptr.3d 606, 139 P.3d 2.) Rule 5–100 states in relevant part: “A member shall not threaten to present criminal, administrative, or disciplinary charges to obtain an advantage in a civil dispute.”

Here, Brown went a step further than merely threatening to present administrative charges. He actually did present an administrative charge to the State Bar, through Zerah, and the communications he had with plaintiff and plaintiff’s law partner demonstrate that the purpose of filing the State Bar complaint was to gain an advantage in the underlying action by pressuring plaintiff and his law partner into immediately signing off on the settlement check. In an e-mail, Brown insisted that the State Bar would essentially make plaintiff’s life a living hell unless plaintiff demonstrated good faith to the State Bar by immediately signing off on the settlement check.

(Cohen, supra, 173 Cal.App.4th at p. 317.)

Plaintiff Lai contends the illegal conduct here is the filing of a false State Bar complaint. Plaintiff Lai cites Business and Professions Code section 6043.5, subdivision (a) which states, “Every person who reports to the State Bar or causes a complaint to be filed with the State Bar that an attorney has engaged in professional misconduct, knowing the report or complaint to be false and malicious, is guilty of a misdemeanor.” However, as noted in Cohen, the illegality must be conceded or demonstrated as a matter of law. Plaintiff Lai clearly understands this point in citing to Flatley v. Mauro (2006) 39 Cal.4th 299, 316: “[W]here either the defendant concedes the illegality of its conduct or the illegality is conclusively shown by the evidence, the [special] motion [to strike] must be denied.”

Here, plaintiff Lai alleges Wang filed a malicious and false bar complaint (FAC, ¶26), but also alleges “Attorney Melen knowingly gave substantial assistance to Wang, aiding and abetting [Wang] in … instituting the false bar complaint.” (FAC, ¶30.) Defendant Moore and Melen are also alleged to be co-conspirators. (FAC, ¶48.) These are merely allegations. Plaintiff Lai does not demonstrate the falsity of the State Bar complaint nor does he establish that any of the defendants knew the State Bar complaint to be false and malicious. Nor has plaintiff demonstrated defendants Moore and Melen aided and abetted or conspired with defendant Wang in the filing of the State Bar complaint. The only reference to the State Bar complaint in plaintiff Lai’s supporting declaration is found at paragraph 15 wherein plaintiff Lai states, “The false bar complaint was filed in May 2017, after Wang retained Melen as her attorney.” This statement does not demonstrate, as a matter of law or through defendants’ concession, either the falsity of the State Bar complaint or any of the defendants’ knowledge of falsity and malice.

Plaintiff Lai argues further that the defendants Moore and Melen’s underlying conduct was illegal because they committed perjury , subornation of perjury , falsification of evidence , and extortion . Plaintiff Lai directs the court’s attention to paragraph 37 of the FAC where it is alleged: “Attorney Moore then knowingly misrepresented the transcript of the family court hearing, and then much more gravely, intentionally presented a falsified document manufactured by Wang to the panel of arbitrators.” Plaintiff Lai contends “none of the defendants actually denied the allegations,” and cites legal authority suggesting defendants’ silence constitutes a tacit or adoptive admission of its truth. Plaintiff Lai’s argument is not persuasive. In bringing this special motion to strike and the accompanying demurrer, defendants Moore and Melen are not yet required to formally answer the allegations. Defendants Moore and Melen have made no admission, tacit or otherwise, of the allegations set forth in plaintiff Lai’s FAC.

Plaintiff Lai also attempts to prove the allegation made at paragraph 37 of the FAC. According to Lai, Moore presented a false document to the arbitrators in connection with the arbitration brief submitted on Wang’s behalf on or about July 2, 2018. (See ¶4 and Exh. C to the Plaintiff’s Declaration in Support of Opposition to Motion to Strike (“Declaration Lai”).) According to Lai, the relevant portion of the arbitration brief stated, “After [Lai] terminated [Wang] as his client, [Wang’s] new counsel (Michelle Melen, Esq.) found in the boxes [Lai] dumped in public at a low-income public clinic lobby’s wall, Ms. Melen found all the evidence necessary for [Lai] to have understood the financial arrangement described above: bank statements reflecting the transactions ($75,000 on July 13, 2015 and $89,290 on August 13, 2015) which he obviously ignored. (Exhibit E hereto.)” (See Exh. C (at page 7, lines 11 – 15) to the Declaration Lai.) The particular document is a single page spreadsheet captioned, “Discover Bank Account Activity.” (See ¶5 and Exh. D to the Declaration Lai.)

Lai contends Moore’s representation that Melen found the document in the records returned from Lai to Wang is false as is the document itself. Lai relies on his own arbitration brief and the arguments set forth therein. In the brief, Lai disputes having possession of the spreadsheet and posits the theory that the spreadsheet was created by Wang after the termination of representation. At best, this presents a factual dispute. Lai’s evidence does not conclusively establish, as a matter of law, any illegality by defendants Moore or Melen. Lai’s knowledge of Wang’s financial condition is further placed in dispute by Lai’s declaration stating he never saw the bank records which Wang claims she presented to Lai. (See ¶9 to the Declaration Lai; see ¶8 and Exh. C to Defendant Wen Fang Wang’s Declaration in Support of Special Motions to Strike, etc.)

Plaintiff Lai next directs the court’s attention to paragraph 31 of the FAC which states: “Then Attorney Melen filed a stay of the present action on November 21, 2017. However, merely two weeks later, on December 5, 2017, in support of Wang and her request for attorney’s fee, both of them presented declarations to the family court that Plaintiff was owed attorney’s fees and costs in the amount of $24,776.43.” Plaintiff Lai provides no context from which this court can derive any illegality. It is unclear the statute or standards under which the family court would determine whether attorney’s fees were warranted and, thus, whether knowledge that Wang was disputing Lai’s fees is essential to the family court’s determination. Even more fundamentally, it is unclear how such an allegation can even form the basis for a claim of malicious prosecution or abuse of process as the family court action is between Wang and her (former) husband. Presumably, the allegation is being offered to show that Wang disputed Lai’s fees in fee arbitration, but acknowledged Lai’s fees in the family court action. Even so, plaintiff Lai has not conclusively demonstrated the illegality of Melen’s conduct. Consequently, plaintiff Lai has not made the necessary showing that defendants Moore and Melen engaged in any illegal conduct as a matter of law, either through defendants’ concession or by uncontroverted and conclusive evidence. Since plaintiff Lai has not made the necessary showing, the court proceeds with the next step in the analysis.

D. Step two – probability of prevailing.

“[I]f a court ruling on an anti-SLAPP motion concludes the challenged cause of action arises from protected petitioning, it then determines whether the plaintiff has demonstrated a probability of prevailing on the claim. To satisfy this prong, the plaintiff must state and substantiate a legally sufficient claim. Put another way, the plaintiff must demonstrate that the complaint is both legally sufficient and supported by a sufficient prima facie showing of facts to sustain a favorable judgment if the evidence submitted by the plaintiff is credited.” (Jarrow Formulas, Inc. v. LaMarche (2003) 31 Cal.4th 728, 741; internal citations and punctuation omitted.) “The court does not weigh credibility or comparative strength of the evidence. The court considers defendant’s evidence only to determine if it defeats plaintiff’s showing as a matter of law.” (Soukup v. Law Offices of Herbert Hafif (2006) 39 Cal.4th 260, 291.)

1. Malicious prosecution.

“To establish a cause of action for the malicious prosecution of a civil proceeding, a plaintiff must plead and prove that the prior action (1) was commenced by or at the direction of the defendant and was pursued to a legal termination in his, plaintiff’s, favor [citations]; (2) was brought without probable cause [citations]; and (3) was initiated with malice.” (Bertero v. National General Corp. (1974) 13 Cal.3d 43, 50; see also CACI, No. 1501.) The elements for the cause of action were also stated in Robinzine v. Vicory (2006) 143 Cal.App.4th 1416, 1422, where the court wrote, “To establish a cause of action for malicious prosecution, the plaintiff must prove the prior action was: (1) brought by the defendant and resulted in a favorable termination for the plaintiff; (2) initiated or continued without probable cause; and (3) initiated with malice.”

In plaintiff Lai’s complaint, it is unclear what constitutes the prior action. Plaintiff Lai seemingly refers to the State Bar complaint as well as the fee arbitration. With regard to the State Bar complaint, defendants contend a complaint to the State Bar that does not result in any formal proceedings does not constitute a prior action upon which a claim for malicious prosecution can be based. Defendants rely on Lebbos v. State Bar (1985) 165 Cal.App.3d 656, 670–671, where the court stated:

Investigations which do not lead to initiation of proceedings before an official body or administrative board having the power to take action adversely affecting legally protected interests of the accused are not a sufficient basis upon which to found an action for malicious prosecution. (Chen v. Fleming, supra., 147 Cal.App.3d at p. 41; Imig v. Ferrar (1977) 70 Cal.App.3d 48, 58 [138 Cal.Rptr. 540].)

…

Formal proceedings against a member of the State Bar are only commenced upon the issuance of an order to show cause. (Rules 510, 550.) Only after formal disciplinary proceedings are concluded can the State Bar impose any sanctions, and only the California Supreme Court can impose the harshest sanctions, suspension or disbarment of an attorney. (Bus. & Prof. Code, § 6078.)

In the instant case Lebbos alleges that the investigation referee completely exonerated her at the completion of the hearing. No order to show cause was issued, and therefore no formal proceedings were initiated. Since the investigations of the complaints against Lebbos ended in an investigatory stage and never led to proceedings before any body which had “the power to take action adversely affecting [her] legally protected interests,” there was no basis for an action for malicious prosecution.

In opposition, plaintiff Lai, after citing to general principles governing special motions to strike (including the recognition that plaintiff has the burden to support his claim with a sufficient prima facie showing of fact), offers no argument to address defendants’ point that a State Bar complaint, without the initiation of any formal proceedings, does not constitute a prior action for purposes of malicious prosecution.

Thus, plaintiff Lai is left with the fee arbitration as the sole basis for his claim of malicious prosecution. However, plaintiff Lai has not proffered any admissible evidence to support a claim for malicious prosecution based upon the fee arbitration. Notably absent is any admissible evidence that defendants Moore and Melen initiated or continued the fee arbitration without probable cause or that defendants Moore and Melen initiated the fee arbitration with malice. Plaintiff Lai has not met his burden of demonstrating a probability of prevailing on the claim for malicious prosecution against defendants Moore and Melen.

2. Abuse of process.

“To establish a cause of action for abuse of process, a plaintiff must plead two essential elements: that the defendant (1) entertained an ulterior motive in using the process and (2) committed a willful act in a wrongful manner.” (Coleman v. Gulf Insurance Group (1986) 41 Cal.3d 782, 792; see also CACI, No. 1520.) However, “[t]here is no tort [for abuse of process] where process is used properly albeit with a bad motive.” (Susan S. v. Israels (1997) 55 Cal.App.4th 1290, 1303 (Israels) citing Abraham v. Lancaster Community Hospital (1990) 217 Cal.App.3d 796, 826 (Abraham).)

There are two main elements of a cause of action for abuse of process: “ ‘ “first, an ulterior purpose, and second, a wilful act in the use of the process not proper in the regular conduct of the proceeding.” ’ ” (Oren Royal Oaks Venture v. Greenberg, Bernhard, Weiss & Karma, Inc. (1986) 42 Cal.3d 1157, 1168, 232 Cal.Rptr. 567, 728 P.2d 1202.) “Process is action taken pursuant to judicial authority…. [¶] Merely obtaining or seeking process is not enough; there must be subsequent abuse, by a misuse of the judicial process for a purpose other than that which it was intended to serve. [Citations.] The gist of the tort is the improper use of the process after it is issued.” (Adams v. Superior Court (1992) 2 Cal.App.4th 521, 530–531, 3 Cal.Rptr.2d 49.)

(Siam v. Kizilbash (2005) 130 Cal.App.4th 1563, 1579 (Siam).)

In Oren Royal Oaks Venture v. Greenberg, Bernhard, Weiss & Karma, Inc. (1986) 42 Cal.3d 1157, 1162, fn. 3 (italics original), the California Supreme Court wrote:

The essential elements of abuse of process, as the tort has developed, have been stated to be: first, an ulterior purpose, and second, a wilful act in the use of process not proper in the regular conduct of the proceeding. . . . The improper purpose usually takes the form of coercion to obtain a collateral advantage, not properly involved in the proceeding itself, such as the surrender of property or the payment of money, by the use of the process as a threat or a club. There is, in other words, a form of extortion, and it is what is done in the course of negotiation, rather than the issuance of any formal use of the process itself, which constitutes the tort. [Citation.]

Here, plaintiff Lai alleges, “The forged document and the intentional misrepresentations alleged herein were not designed to settle a fee dispute but to delay the resolution of the present action, to burden Plaintiff financially, to harass Plaintiff, and to pressure plaintiff to give up valid claims….” (FAC, ¶43.) Again, plaintiff Lai directs the court to his fee arbitration statement and the arguments contained therein. (See ¶2 and Exh. A to the Declaration Lai.) However, the court finds nothing in Lai’s fee arbitration statement to support a prima facie showing that defendants entertained any ulterior motive or purpose in commencing fee arbitration or in presenting any argument in connection therewith. Plaintiff Lai has not met his burden of demonstrating a probability of prevailing on the claim for abuse of process against defendants Moore and Melen.

3. Conspiracy.

Civil conspiracy is not an independent tort. (Applied Equipment Corp. v. Litton Saudi Arabia Ltd. (1994) 7 Cal.4th 503, 510-511.) Rather, it is a “ ‘legal doctrine that imposes liability on persons who, although not actually committing a tort themselves, share with the immediate tortfeasor a common plan or design in its perpetration.’ [Citation.]” (Kidron v. Movie Acquisition Corp. (1995) 40 Cal.App.4th 1571, 1581 (Kidron).) Liability for civil conspiracy requires three elements: (1) formation of the conspiracy (an agreement to commit wrongful acts); (2) operation of the conspiracy (commission of the wrongful acts); and (3) damage resulting from operation of the conspiracy. (Quelimane Co. v. Stewart Title Guaranty Co. (1998) 19 Cal.4th 26, 47; see also CACI, No. 3600.)

Plaintiff Lai makes no showing whatsoever concerning defendants Moore and Melen’s participation in a conspiracy. Also notably absent is any admissible evidence of any damage suffered by plaintiff Lai as a result of the operation of the conspiracy. Plaintiff Lai has not met his burden of demonstrating a probability of prevailing on the claim for conspiracy against defendants Moore and Melen.

Consequently, defendants Moore and Melen’s special motion to strike the fourth through sixth causes of action in plaintiff Lai’s FAC pursuant to Code of Civil Procedure section 425.16 is GRANTED.

E. Request to conduct discovery.

“All discovery proceedings in the action shall be stayed upon the filing of a notice of motion made pursuant to this section. The stay of discovery shall remain in effect until notice of entry of the order ruling on the motion. The court, on noticed motion and for good cause shown, may order that specified discovery be conducted notwithstanding this subdivision.” (Code Civ. Proc., §425.16, subd. (g).)

Plaintiff Lai requests the court stay any ruling and allow plaintiff Lai to conduct discovery to overcome this special motion to strike. Initially, plaintiff Lai’s request is not properly made in opposition to the special motion to strike. The statute requires such a request to be made “on noticed motion.” More importantly, plaintiff Lai has not demonstrated good cause. Plaintiff Lai seeks to conduct limited discovery into Wang’s bank transactions with regard to her mother and brother and their transaction to Wang’s husband. However, there is no explanation how this will conclusively demonstrate any illegality or how it would support a prima facie claim against the defendants for malicious prosecution, abuse of process, or conspiracy. Accordingly, plaintiff Lai’s request to conduct discovery is DENIED.

II. Defendants Moore and Melen’s demurer/motion to strike the FAC is MOOT.

In light of the court’s ruling above, defendants Moore and Melen’s demurrer/ motion to strike plaintiff Lai’s FAC is deemed MOOT.

III. Defendant Wang’s special motion to strike the FAC is GRANTED, in part, and DENIED, in part.

A. Procedural issues/ request to conduct discovery.

Plaintiff Lai filed a joint opposition to defendants Moore and Melen’s special motion to strike and defendant Wang’s separately-filed special motion to strike. For the same reasons discussed above, plaintiff Lai’s challenge to defendant Wang’s special motion to strike on procedural grounds is rejected.

Likewise, plaintiff Lai’s request to conduct discovery is DENIED.

B. Merits.

As indicated above, the first three causes of action for fraud, breach of contract, and common counts appear to be directed at defendant Wang only. In addressing the fraud cause of action, defendant Wang cites the general proposition that, “Statements made in litigation, or in connection with litigation, are protected by Code of Civil Procedure section 425.16, subdivision (e).” (Bergstein v. Stroock & Stroock & Lavan LLP (2015) 236 Cal.App.4th 793, 803–804.) Defendant Wang directs the court’s attention to a January 29, 2016 email in which plaintiff Lai accuses Wang of making misrepresentations about her financial ability to pay in a declaration. Defendant Wang contends that since her alleged misrepresentations were made in the course of the divorce action, then they are protected by the anti-SLAPP statute.

Defendant Wang misunderstands the initial burden. The fraud cause of action must arise from the protected activity. “[T]he critical consideration is whether the cause of action is based on the defendant’s protected free speech or petitioning activity.” (Navellier v. Sletten (2002) 29 Cal.4th 82, 89.) Here, defendant Wang’s misrepresentation about her financial condition is what allegedly induced plaintiff Lai to represent defendant Wang in her divorce. Plaintiff Lai relied on Wang’s misrepresentations in entering into an attorney-client relationship/ retainer agreement to provide legal service at no cost to Wang. (FAC, ¶¶10 and 13.) While the misrepresentations may have been repeated in a subsequently court-filed declaration, the fraud claim does not arise from that later-filed declaration; the fraud claim arises from the misrepresentations made by Wang to secure legal representation at no cost.

With regard to the second and third causes of action for breach of contract and common counts, defendant Wang acknowledges these two claims are based upon her alleged failure to pay plaintiff Lai for his legal representation, but argues that since plaintiff Lai’s justification for termination of the retainer agreement is Lai’s assertion that Wang made misrepresentations, then the true gravamen of the breach of contract and common counts causes of action is fraud and, as argued above, subject to anti-SLAPP protection. However, as discussed above, the alleged fraud is not based on and does not arise from protected activity. The court is not persuaded by defendant Wang’s argument that plaintiff Lai’s breach of contract and common counts causes of action arise from or are based upon any protected activity.

Consequently, defendant Wang’s special motion to strike the first through third causes of action in plaintiff Lai’s FAC pursuant to Code of Civil Procedure section 425.16 is DENIED.

With regard to the fourth through sixth causes of action, the court’s analysis above with regard to defendants Moore and Melen also applies to defendant Wang. Accordingly, defendant Wang’s special motion to strike the fourth through sixth causes of action in plaintiff Lai’s FAC pursuant to Code of Civil Procedure section 425.16 is GRANTED.

IV. Defendant Wang’s demurrer/ motion to strike the FAC is SUSTAINED, in part, OVERRULED, in part, and MOOT, in part.

A. Fraud.

“The elements of fraud, which give rise to the tort action for deceit, are (a) misrepresentation (false representation, concealment, or nondisclosure); (b) knowledge of falsity (or ‘scienter’); (c) intent to defraud, i.e., to induce reliance; (d) justifiable reliance; and (e) resulting damage.” (Lazar v. Superior Court (1996) 12 Cal.4th 631, 638 (Lazar).) “Fraud actions are subject to strict requirements of particularity in pleading. … Accordingly, the rule is everywhere followed that fraud must be specifically pleaded.” (Committee on Children’s Television, Inc. v. General Foods Corp. (1983) 35 Cal.3d 197, 216.) “The pleading should be sufficient to enable the court to determine whether, on the facts pleaded, there is any foundation, prima facie at least, for the charge of fraud.” (Commonwealth Mortgage Assurance Co. v. Superior Court (1989) 211 Cal.App.3d 508, 518.) The Lazar court did not comment on how these particular allegations met the requirement of pleading with specificity in a fraud action, but the court did say that “this particularity requirement necessitates pleading facts which ‘show how, when, where, to whom, and by what means the representations were tendered.’ A plaintiff’s burden in asserting a claim against a corporate employer is even greater. In such a case, the plaintiff must ‘allege the names of the persons who made the allegedly fraudulent representations, their authority to speak, to whom they spoke, what they said or wrote, and when it was said or written.” (Lazar, supra, 12 Cal.4th at p. 645.)

Defendant Wang argues, initially, that plaintiff Lai has not alleged knowledge of falsity, intent, or justifiable reliance except in conclusory terms. “Intent, like knowledge, is a fact. Hence, the averment that the representation was made with the intent to deceive the plaintiff, or any other general allegation with similar purport, is sufficient.” (5 Witkin, California Procedure (4th ed. 1997) Pleading, §684, p. 143.) Allegations that defendant Wang knew the representations to be false are found at paragraph 10 of the FAC as are allegations of Wang’s intent to defraud. Allegations of reliance are found at paragraphs 12 – 13 of the FAC. To the extent defendant Wang contends reliance is not justifiable, the reasonableness of plaintiff’s reliance is better left to a trier of fact. “Except in the rare case where the undisputed facts leave no room for a reasonable difference of opinion, the question of whether a plaintiff’s reliance is reasonable is a question of fact.” (Alliance Mortgage Co. v. Rothwell (1995) 10 Cal.4th 1226, 1239; see also Guido v. Koopman (1991) 1 Cal.App.4th 837, 843—“Justifiable reliance is an essential element of a claim for fraudulent misrepresentation, and the reasonableness of the reliance is ordinarily a question of fact.”)

Next, defendant Wang contends the misrepresentations alleged in the FAC are deficient because they do not match the misrepresentations that plaintiff Lai accuses defendant Wang of in a later email to Wang. Defendant Wang’s argument falls outside the four corners of the pleading and relies upon matters extrinsic to the pleading.

Accordingly, defendant Wang’s demurrer to the first cause of action in plaintiff Lai’s FAC on the ground that the pleading does not state facts sufficient to constitute a cause of action [Code Civ. Proc., §430.10, subd. (e)] for fraud is OVERRULED.

B. Breach of Contract.

“To prevail on a cause of action for breach of contract, the plaintiff must prove (1) the contract, (2) the plaintiff’s performance of the contract or excuse for nonperformance, (3) the defendant’s breach, and (4) the resulting damage to the plaintiff.” (Richman v. Hartley (2014) 224 Cal.App.4th 1182, 1186; see also CACI, No. 303.)

Defendant Wang demurs, in part, by arguing that plaintiff Lai has not adequately alleged his own performance of the retainer agreement. Plaintiff’s performance is indeed an element of a breach of contract claim. “The plaintiff cannot enforce the defendant’s obligation unless the plaintiff has performed the conditions precedent imposed on him. [Citation.] Accordingly, the allegation of performance is an essential part of his cause of action. [Citation.]” (4 Witkin, California Procedure (4th ed. 1997) Pleading, §491, pp. 581 – 582.) “But the foregoing requirement is reduced to a mere formality by [Code Civ. Proc., §457 ] which makes it unnecessary to set forth the facts of such performance: The plaintiff may allege, in general terms, that he has ‘duly performed all the conditions on his part.’” (Id. at p. 582.)

In opposition, plaintiff directs the court’s attention to paragraph 13 which states, “In reliance on these representations, Plaintiff was induced to and did perform legal substantial services for Wang without receiving adequate compensation and advanced legal fees for her.” This does not suffice even under the general requirement of Code of Civil Procedure section 457.

Accordingly, defendant Wang’s demurrer to the second cause of action in plaintiff Lai’s FAC on the ground that the pleading does not state facts sufficient to constitute a cause of action [Code Civ. Proc., §430.10, subd. (e)] for breach of contract is SUSTAINED with 10 days’ leave to amend.

C. Common Counts.

Defendant Wang’s sole argument against the third cause of action is that it is derivative of the second cause of action and because the second specific cause of action for breach of contract is defective, then the more general common count is also defective.

A common count is not a specific cause of action, however; rather, it is a simplified form of pleading normally used to aver the existence of various forms of monetary indebtedness, including that arising from an alleged duty to make restitution under an assumpsit theory. [Citations.] When a common count is used as an alternative way of seeking the same recovery demanded in a specific cause of action, and is based on the same facts, the common count is demurrable if the cause of action is demurrable. [Citations.]

(McBride v. Boughton (2004) 123 Cal.App.4th 379, 394.)

Plaintiff Lai cites to general principles of quantum meruit and pleading common counts, but does not address the specific point raised here. Accordingly, defendant Wang’s demurrer to the third cause of action in plaintiff Lai’s FAC on the ground that the pleading does not state facts sufficient to constitute a cause of action [Code Civ. Proc., §430.10, subd. (e)] for common counts is SUSTAINED with 10 days’ leave to amend.

D. Fourth through Sixth Causes of Action.

In light of the court’s ruling above, defendant Wang’s demurrer to the fourth through sixth causes of action in plaintiff Lai’s FAC is deemed MOOT.

E. Motion to strike punitive damages.

In light of the court’s ruling above, defendant Wang’s motion to strike plaintiff Lai’s claim for punitive damages is deemed MOOT.