Filed 7/16/20 Aetna Inc. v. Whatley Kallas, LLP CA2/7

NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS

California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

SECOND APPELLATE DISTRICT

DIVISION SEVEN

AETNA INC.,

Plaintiff and Appellant,

v.

WHATLEY KALLAS, LLP, et al.,

Defendants and Respondents.

B292572

(Los Angeles County

Super. Ct. No. BC707386)

APPEAL from an order of the Superior Court of Los Angeles County, Richard E. Rico, Judge. Reversed.

Manatt, Phelps & Phillips, Matthew P. Kanny and Benjamin G. Shatz for Plaintiff and Appellant.

Thompson Coburn, Jeffrey N. Brown, Kacey R. Riccomini and J. David Duffy for Defendant and Respondent Whatley Kallas, LLP.

Strumwasser & Woocher, Fredric D. Woocher, Michael J. Strumwasser and Caroline Chiappetti for Defendant and Respondent Consumer Watchdog.

INTRODUCTION

Whatley Kallas, LLP and Consumer Watchdog filed two lawsuits against Aetna Inc. on behalf of certain members of Aetna. The parties settled those lawsuits and hired a settlement administrator to give notice of the settlement to Aetna’s members. When mailing the notices, the settlement administrator used the wrong kind of envelopes and inadvertently disclosed personal health information about Aetna’s members, which prompted some of Aetna’s members to sue Aetna again. The members, however, did not sue the settlement administrator, Whatley Kallas, or Consumer Watchdog.

After settling the new lawsuits, Aetna filed this action against Whatley Kallas and Consumer Watchdog for indemnity and contribution. Whatley Kallas and Consumer Watchdog filed special motions to strike under Code of Civil Procedure section 425.16 (section 425.16), which the trial court granted. Because Aetna’s causes of action for indemnity and contribution are based on alleged professional negligence by Whatley Kallas and Consumer Watchdog, they are not subject to section 425.16. Therefore, we reverse.

FACTUAL AND PROCEDURAL BACKGROUND

A. Aetna Files This Action Against Whatley Kallas and Consumer Watchdog for Indemnity and Contribution

In 2014 and 2015 Whatley Kallas and Consumer Watchdog filed two putative class actions on behalf of certain members of Aetna against Aetna and one of its affiliates, alleging Aetna unlawfully required its members to obtain HIV medication by mail (the Doe actions). The parties settled the Doe actions in 2017. The settlement provided that certain members of Aetna would receive a notice in the mail advising them of their options when filling prescriptions for HIV medication.

Kurtzman Carson Consultants (KCC) was retained as the settlement administrator. On July 28, 2017 KCC mailed the notices to 12,000 members of Aetna “using envelopes with see-through address windows” instead of windowless envelopes. After KCC mailed the notices, Aetna received complaints from some members claiming the windowed envelopes revealed the words “HIV medications” next to the members’ names and addresses. Several members filed new lawsuits against Aetna, which were consolidated into a single action (the Beckett action). In January 2018 Aetna agreed to pay $17 million to settle the Beckett action.

In May 2018 Aetna filed this action against Whatley Kallas and Consumer Watchdog for equitable indemnity, contribution, and declaratory relief. Aetna alleged that Whatley Kallas engaged KCC to administer the Doe settlement and that Whatley Kallas and Consumer Watchdog supervised KCC in preparing and mailing the notices. Aetna alleged that, because Whatley Kallas and Consumer Watchdog negligently failed to “review the final proofs of the envelopes that would be used to send the [n]otices,” KCC mailed the notices in windowed envelopes that purportedly revealed the members’ health information. Aetna alleged it was entitled to indemnity and contribution from Whatley Kallas and Consumer Watchdog for liability arising from the mailing, including for Aetna’s settlement of the Beckett action, because, “[a]s counsel for the Plaintiffs in the [underlying] [l]awsuits tasked with administering the [s]ettlement,” Whatley Kallas and Consumer Watchdog “assumed and undertook a duty to protect the putative class of Aetna [m]embers.” Aetna alleged Whatley Kallas and Consumer Watchdog breached that duty by allowing KCC to mail the improper notices.

B. The Trial Court Grants Special Motions To Strike by Whatley Kallas and Consumer Watchdog

Whatley Kallas and Consumer Watchdog filed special motions to strike under section 425.16. They contended their administration of the Doe settlement was protected litigation activity under section 425.16. They further contended Aetna could not demonstrate a probability of prevailing on their causes of action because the litigation privilege in Civil Code section 47, subdivision (b), barred each of Aetna’s causes of action and because a third party cannot seek indemnity against opposing counsel based on counsel’s alleged legal malpractice. Aetna argued that section 425.16 does not apply to an attorney’s alleged breach of professional duties and that, because Aetna’s indemnity and contribution causes of action were “premised on [Whatley Kallas’s and Consumer Watchdog’s] breaches of duty,” the causes of action did not arise from protected activity. Aetna also argued that neither the litigation privilege nor any other defense barred its causes of action.

The trial court granted the special motions to strike. In the first step of the section 425.16 analysis, the court ruled Aetna’s causes of action arose from representation by Whatley Kallas and Consumer Watchdog of their clients during the administration of the Doe settlement and that section 425.16 “extends to activities in connection with the . . . implementation[ ] and enforcement of a settlement agreement.” In the second step, the trial court ruled Aetna could not demonstrate a probability of prevailing on its causes of action because the settlement-related conduct of Whatley Kallas and Consumer Watchdog was “indisputably” subject to the litigation privilege in Civil Code section 47. Aetna timely appealed.

DISCUSSION

A. Applicable Law and Standard of Review

Section 425.16, subdivision (b)(1), provides that “[a] cause of action against a person arising from any act of that person in furtherance of the person’s right of petition or free speech under the United States Constitution or the California Constitution in connection with a public issue shall be subject to a special motion to strike, unless the court determines that the plaintiff has established that there is a probability that the plaintiff will prevail on the claim.” Courts evaluate special motions to strike under section 425.16 “through a two-step process. Initially, the moving defendant bears the burden of establishing that the challenged allegations or claims ‘aris[e] from’ protected activity in which the defendant has engaged. [Citations.] If the defendant carries its burden, the plaintiff must then demonstrate its claims have at least ‘minimal merit.’” (Park v. Board of Trustees of California State University (2017) 2 Cal.5th 1057, 1061 (Park); see Zhang v. Jenevein (2019) 31 Cal.App.5th 585, 592.) “‘We review de novo the grant or denial of’” a special motion to strike under section 425.16. (Sweetwater Union High School Dist. v. Gilbane Building Co. (2019) 6 Cal.5th 931, 940; see Park, at p. 1067.)

B. Aetna’s Causes of Action Do Not Arise from Protected Speech or Petitioning Activity Under Section 425.16

1. Section 425.16 Does Not Apply to Legal Malpractice Causes of Action

Generally “an attorney’s ‘litigation-related activities’ . . . constitute acts in furtherance of a person’s right of petition” for purposes of section 425.16. (Sprengel v. Zbylut (2015) 241 Cal.App.4th 140, 151 (Sprengel); see Rusheen v. Cohen (2006) 37 Cal.4th 1048, 1056; Optional Capital, Inc. v. Akin Gump Strauss, Hauer & Feld LLP (2017) 18 Cal.App.5th 95, 113; but see Old Republic Construction Program Group v. The Boccardo Law Firm, Inc. (2014) 230 Cal.App.4th 859, 874 [section 425.16 does not apply to an attorney’s noncommunicative litigation activity unless the activity is “‘“in connection with a public issue or an issue of public interest”’”].) This court in Sprengel, however, joined a long line of cases holding “malpractice claims that challenge the competency of an attorney’s legal services are not subject to section 425.16 because, in such cases, ‘the client is not suing because the attorney petitioned on his or her behalf, but because the attorney did not competently represent the client’s interests while doing so.’” (Sprengel, at pp. 154 155; accord, Kolar v. Donahue, McIntosh & Hammerton (2006) 145 Cal.App.4th 1532, 1540; see Yeager v. Holt (2018) 23 Cal.App.5th 450, 457 [“a typical attorney malpractice suit is not subject to” section 425.16]; Robles v. Chalilpoyil (2010) 181 Cal.App.4th 566, 578-579 [“section 425.16 does not shield statements made on behalf of a client who alleges negligence in the defendant’s representation of the client or breach of the duty of loyalty”]; Jespersen v. Zubiate-Beauchamp (2003) 114 Cal.App.4th 624, 632 (Jespersen) [section 425.16 does not apply to “garden variety attorney malpractice” action based on an attorney’s failure to comply with discovery statutes and court orders].)

These cases recognize that the Legislature did not intend the anti-SLAPP statute to apply to legal malpractice actions. “‘“SLAPP” is an acronym for “strategic lawsuit against public participation.”’” (Monster Energy Co. v. Schechter (2019) 7 Cal.5th 781, 785, fn. 1.) When lawyers make a mistake like the one Aetna claims the lawyers made here, they are not doing or participating in anything public. If the mistake is below the standard of care, the lawyers are simply committing malpractice. As the court observed in Robles v. Chalilpoyil, supra, 181 Cal.App.4th 566, it is the parties who are exercising their constitutional petitioning rights during litigation. To turn clients’ “own constitutional right against them when they claim negligence and fraud” by the attorney “in the exercise of that right would be manifestly unfair and surely beyond the contemplation of the Legislature even in its mandate to construe [section 425.16] broadly.” (Id. at p. 580.)

Our dissenting colleague, based on an argument Whatley Kallas and Consumer Watchdog do not make, would overturn nearly two decades of case law under section 425.16, including precedent in this division. (See, e.g., Yeager v. Holt, supra, 23 Cal.App.5th at p. 457; Sprengel, supra, 241 Cal.App.4th at pp. 146 147; Robles v. Chalilpoyil, supra, 181 Cal.App.4th at pp. 578 579; Jespersen, supra, 114 Cal.App.4th at p. 632; see also Castleman v. Sagaser (2013) 216 Cal.App.4th 481, 495; Hylton v. Frank E. Rogozienski, Inc. (2009) 177 Cal.App.4th 1264, 1274; United States Fire Ins. Co. v. Sheppard, Mullin, Richter & Hampton LLP (2009) 171 Cal.App.4th 1617, 1628; Freeman v. Schack (2007) 154 Cal.App.4th 719, 732; Bensara v. Mitchell Silberberg & Knupp LLP (2004) 123 Cal.App.4th 1179, 1189.) Neither the Legislature nor the Supreme Court has taken any action to disapprove any of these cases, and no one in this litigation contends any or all of them were wrongly decided. (See Bourhis v. Lord (2013) 56 Cal.4th 320, 327 [stare decisis “is especially forceful when, as here, the issue is one of statutory construction, because the Legislature can always overturn a judicial interpretation of a statute”]; People v. Martinez (1995) 11 Cal.4th 434, 447 [“we are particularly reluctant to disturb any judicial construction of a statute which has been in existence for a significant period of time”].)

2. Section 425.16 Does Not Apply to Indemnity Causes of Action Based on Legal Malpractice

As stated, the parties agree that a client’s cause of action for professional negligence against the client’s attorneys is not subject to section 425.16. But this case does not involve such a malpractice cause of action; Aetna is not suing its attorneys for professional negligence. Instead, Aetna is suing Whatley Kallas and Consumer Watchdog for contribution and indemnity, alleging that they were negligent and that their negligence, not any conduct by Aetna, caused the injuries to Aetna’s members. The issue in this case is whether the rule in Yeager, Sprengel, Robles, and Jespersen applies to a non-attorney’s indemnity or contribution cause of action against an attorney that is based on the attorney’s alleged professional negligence.

One court has weighed in on this issue. In Chodos v. Cole (2012) 210 Cal.App.4th 692 the court considered whether section 425.16 applied to an indemnity cause of action based on legal malpractice. In that case two attorneys sued their former client to recover unpaid fees incurred representing the client in marital dissolution proceedings, and the client filed a cross-complaint for legal malpractice. (Id. at pp. 696-697.) The attorneys filed a cross-complaint for equitable indemnity against other attorneys who had represented the client. (Id. at p. 697.) The second set of attorneys filed special motions to strike, which the trial court granted. (Ibid.) The court in Chodos reversed. After acknowledging section 425.16 “does not apply to claims of attorney malpractice,” the court reasoned that “[i]ndemnity and malpractice may be different causes of action, but that does not mean that the claim for indemnification based on malpractice should be treated differently than a malpractice claim for purposes of whether [section 425.16] is applicable.” (Id. at pp. 702 704.) The claim for indemnity is still grounded in allegations of attorney malpractice.” (Id. at p. 704.)

We agree with Chodos that an indemnity cause of action filed against an attorney based on the attorney’s alleged professional negligence is not subject to section 425.16. To determine whether a cause of action arises from protected activity under section 425.16, “courts should consider the elements of the challenged claim and what actions by the defendant supply those elements and consequently form the basis for liability.” (Park, supra, 2 Cal.5th at p. 1063; accord, C.W. Howe Partners Inc. v. Mooradian (2019) 43 Cal.App.5th 688, 698.) “‘“The elements of a cause of action for [equitable] indemnity are (1) a showing of fault on the part of the indemnitor and (2) resulting damages to the indemnitee for which the indemnitor is . . . equitably responsible.”’” (C.W. Howe Partners, at p. 700; see Stockton Mortgage, Inc. v. Tope (2014) 233 Cal.App.4th 437, 459; Bailey v. Safeway Inc. (2011) 199 Cal.App.4th 206, 217.) Therefore, in an indemnity cause of action, the “actions by the defendant” that “supply [the] elements and consequently form the basis for liability” (Park, at p. 1063) are the alleged actions by the indemnitor (in a legal malpractice claim, the attorney) that give rise to the indemnitor’s fault and cause the resulting damage to the third party.

Where, as here, the alleged indemnitee (Aetna) contends an attorney (the indemnitor) is at fault because his or her professional negligence caused injuries to the attorney’s clients, the indemnity cause of action arises from the attorney’s professional negligence—just as if the attorney’s clients had filed a legal malpractice cause of action directly against the attorney. Therefore, the indemnity cause of action does not arise from the attorney’s protected petitioning activity. As we explained in Sprengel, even where the alleged malpractice occurs during litigation, “[a]lthough [the] claims may have been ‘“‘triggered by’ or associated with”’” the attorney’s “litigation activities, they do not arise out of those acts. [Citation]. Instead, they arise out of [the attorney’s] breach of professional obligations” and his or her “failing to competently represent [the client’s] interests . . . .” (Sprengel, supra, 241 Cal.App.4th at p. 155; see Gaynor v. Bulen (2018) 19 Cal.App.5th 864, 880 [“a client’s claims against his or her former attorney are not subject to [section 425.16] because the client is seeking recovery for the attorney’s failure to competently represent the client’s interests and/or the attorney’s breach of loyalty owed to the client, and not to recover for injuries resulting from the attorney’s petitioning activities, even if these activities were alleged to be wrongful and harmful to the client’s interests”]; Loanvest I, LLC v. Utrecht (2015) 235 Cal.App.4th 496, 505 [“[t]he fact that the complaint ‘focus[es] specifically on particular statements or positions taken in [litigation] . . . does not alter the fact that the claim is not for injuries . . . caused by the attorney’s advocacy but is based on the alleged breach of loyalty”]; Jespersen, supra, 114 Cal.App.4th at p. 632 [attorney malpractice defendants were not “sued for having negligently filed declarations admitting their malpractice, but for their failure to comply with a discovery statute”]; see also Miller v. Zurich American Ins. Co. (2019) 41 Cal.App.5th 247, 257 [“‘[n]ot all attorney conduct in connection with litigation, or in the course of representing clients, is protected by section 425.16’”].) Because Aetna’s indemnity cause of action is based on the alleged professional negligence of Whatley Kallas and Consumer Watchdog, the cause of action does not arise from protected petitioning activity.

Accepting the Yeager/Sprengel/Robles/Jespersen/etc. rule, Whatley Kallas and Consumer Watchdog argue the Chodos rule should apply only where “an attorney who has been sued by a former client for legal malpractice files an action . . . against other attorneys for that same client.” There is no reason to so limit the scope of the holding in Chodos. To determine whether a claim arises from protected activity, “the focus is on determining what ‘the defendant’s activity [is] that gives rise to his or her asserted liability—and whether that activity constitutes protected speech or petitioning.’” (Park, supra, 2 Cal.5th at p. 1063.) Whether section 425.16 applies to an indemnity claim against an attorney depends on whether the attorney’s alleged conduct giving rise to his or her fault is protected activity under section 425.16—not the identity of the party bringing the indemnity claim. As the court in Chodos explained, “If an act of malpractice by an attorney . . . is not petitioning or free speech under [section 425.16], that same act for the same client should not be deemed to be such petitioning or free speech solely because it is the basis of a claim for indemnity by someone other than the client.” (Chodos, supra, 210 Cal.App.4th at p. 705.)

Whatley Kallas and Consumer Watchdog contend Aetna’s indemnity and contribution causes of action do not arise from alleged professional negligence because Aetna does not allege Whatley Kallas and Consumer Watchdog “violated any . . . professional obligation set forth in the California Rules of Professional Conduct.” But the absence of such an allegation does not mean the causes of action do not arise from Whatley Kallas’s and Consumer Watchdog’s professional negligence. Aetna alleges that, “[a]s counsel for the Plaintiff’s in the Doe Lawsuits,” Whatley Kallas and Consumer Watchdog “assumed and undertook a duty to protect the putative class of Aetna members” and that Whatley Kallas’s and Consumer Watchdog’s “errors, omissions, and negligence” caused the alleged disclosure of the members’ health information. Although Aetna does not allege Whatley Kallas or Consumer Watchdog violated a specific rule of professional conduct, Aetna alleges they were professionally negligent. (See Coscia v. McKenna & Cuneo (2001) 25 Cal.4th 1194, 1199 [the elements of a cause of action for legal malpractice include “the duty of the attorney to use such skill, prudence, and diligence as members of his or her profession commonly possess and exercise,” and “a breach of that duty”]; Wise v. DLA Piper LLP (US) (2013) 220 Cal.App.4th 1180, 1190 [same]; Rules Prof. Conduct, rule 1.1 [“A lawyer shall not intentionally, recklessly, with gross negligence, or repeatedly fail to perform legal services with competence.”].) And Whatley Kallas and Consumer Watchdog cite no authority for the proposition that a legal malpractice plaintiff must identify a rule of professional conduct the plaintiff claims the attorney defendant violated.

Whatley Kallas and Consumer Watchdog also argue Aetna’s causes of action do not arise from professional negligence because a plaintiff can only file a cause of action for equitable indemnity against an alleged indemnitor who is “jointly and severally liable” to the third parties (here, the Beckett plaintiffs) for damages. Whatley Kallas and Consumer Watchdog argue they and Aetna are not joint tortfeasors because, in the Beckett action, the plaintiffs did not allege causes of action for legal malpractice against Aetna (nor could they).

Whatley Kallas and Consumer Watchdog misunderstand what it means to be joint tortfeasors for purposes of equitable indemnity and contribution. “A joint tortfeasor includes joint, concurrent, and successive tortfeasors whose actions combine to cause the plaintiff’s injury.” (Newhall Land & Farming Co. v. McCarthy Construction (2001) 88 Cal.App.4th 769, 773; see Henry v. Superior Court (2008) 160 Cal.App.4th 440, 453, fn. 7 [“the availability of an action for partial equitable indemnity based on principles of comparative fault is not dependent on the existence of ‘“joint tortfeasors” in the classic sense of that term.’”]; GEM Developers v. Hallcraft Homes of San Diego, Inc. (1989) 213 Cal.App.3d 419, 431 [“[t]he term ‘joint tortfeasor’ as used in the comparative equitable indemnity context . . . is a broad term which includes joint, concurrent and successive tortfeasors”].) “‘[I]t matters not whether the tortfeasors acted in concert to create a single injury, or successively, in creating distinct and divisible injury.’” (Henry, at p. 453; see Blecker v. Wolbart (1985) 167 Cal.App.3d 1195, 1200, fn. 2.) “Nor must joint tortfeasors owe the same duty of care to the plaintiff. ‘[A] defendant/indemnitee may in an action for indemnity seek apportionment of the loss on any theory that was available to the plaintiff upon which the plaintiff would have been successful.’” (Leko v. Cornerstone Bldg. Inspection Service (2001) 86 Cal.App.4th 1109, 1115; accord, Willdan v. Sialic Contractors Corp. (2007) 158 Cal.App.4th 47, 56; see, e.g., Safeway Stores, Inc. v. Nest-Kart (1978) 21 Cal.3d 322, 327 [under the “equitable indemnity doctrine . . . liability among joint tortfeasors may be apportioned . . . between a strictly liable defendant and a negligent defendant,” italics omitted]; County of San Mateo v. Berney (1988) 199 Cal.App.3d 1489, 1494 [public entity liable for inverse condemnation may “seek[ ] indemnification from third parties whose negligent or fraudulent acts were causative factors in the damaging or taking of private property”].) Aetna alleges Whatley Kallas and Consumer Watchdog are at fault for the alleged disclosure of the members’ health information—the same injury for which Aetna was allegedly liable in the Beckett action. It does not matter that the Beckett plaintiffs could not have sued Aetna under the same theory of relief.

Finally, Whatley Kallas and Consumer Watchdog argue Aetna cannot bring an indemnity or contribution cause of action against former opposing counsel. This argument goes to the merits of Aetna’s claim and “improperly conflate[s] the first and second prongs of the section 425.16 test. ‘The sole inquiry’ under the first prong of the test is whether the plaintiff’s claims arise from protected speech or petitioning activity. [Citation.] In making this determination, ‘[w]e do not consider the veracity of [the plaintiff’s] allegations’ [citation] nor do we consider ‘[m]erits based arguments.’” (Sprengel, supra, 241 Cal.App.4th at p. 156; see Coretronic Corp. v. Cozen O’Connor (2011) 192 Cal.App.4th 1381, 1388 [“Arguments about the merits of the claims are irrelevant to the first step of the [section 425.16] analysis.”].) Whether Aetna should be allowed to sue former opposing counsel may be relevant to the second step of the analysis under section 425.16, but it does not determine whether Aetna’s causes of action arise from petitioning activity.

DISPOSITION

The order granting the special motion to strike is reversed. Aetna is to recover its costs on appeal.

SEGAL, J.

I concur:

FEUER, J.

PERLUSS, P. J., Dissenting.

Relying on this court’s decision in Sprengel v. Zbylut (2015) 241 Cal.App.4th 140 (Sprengel), my colleagues reaffirm that Code of Civil Procedure section 425.16 (section 425.16), the anti-SLAPP statute, does not apply to claims for litigation-related professional negligence. For the reasons expressed in my dissent in Sprengel, reinforced by the explanation in more recent Supreme Court decisions of the first step in a special motion to strike under section 425.16, I continue to disagree. Nor do I agree the professional negligence exception, even if it did exist, should be extended to include claims by a nonclient.

1. Whatley Kallas and Consumer Watchdog’s First-step Burden

Under section 425.16, “[a] claim arises from protected activity when that activity underlies or forms the basis for the claim.” (Park v. Board of Trustees of California State University (2017) 2 Cal.5th 1057, 1062-1063 (Park).) “The defendant’s first-step burden is to identify the activity each challenged claim rests on and demonstrate that that activity is protected by the anti-SLAPP statute. A ‘claim may be struck only if the speech or petitioning activity itself is the wrong complained of, and not just evidence of liability or a step leading to some different act for which liability is asserted.’” (Wilson v. Cable News Network, Inc. (2019) 7 Cal.5th 871, 884 (Wilson); accord, Park, at p. 1060.) “To determine whether a claim arises from protected activity, courts must ‘consider the elements of the challenged claim and what actions by the defendant supply those elements and consequently form the basis for liability.’” (Wilson, at p. 884; accord, Park, at p. 1063.)

Here, Aetna Inc.’s claims for indemnity and contribution rest entirely on Whatley Kallas, LLP and Consumer Watchdog’s alleged improper supervision of the mailing of notices to certain Aetna members (effectively “insureds”) that detailed new options available to them for filling prescriptions, notices Aetna was required to give as part of the settlement of putative class action lawsuits filed by Whatley Kallas and Consumer Watchdog on behalf of those members. Carrying out the terms of the settlement agreement by distributing this information arose directly from Whatley Kallas and Consumer Watchdog’s representation of their clients and would generally be considered protected petitioning activity within the meaning of section 425.16, subdivision (b)(1). (O&C Creditors Group, LLC v. Stephens & Stephens XII, LLC (2019) 42 Cal.App.5th 546, 569 [“cross-defendants’ conduct in disbursing the settlement proceeds—i.e., carrying out the terms of the settlement agreement—cannot be neatly cleaved from the indisputably protected activity of negotiating and agreeing to the settlement itself”]; see Thayer v. Kabateck Brown Kellner LLP (2012) 207 Cal.App.4th 141, 154 [settlements made in connection with litigation are within section 425.16]; Taheri Law Group v. Evans (2008) 160 Cal.App.4th 482, 489 [lawyer’s conduct in enforcing settlement agreement on his client’s behalf was protected activity under section 425.16].)

Nonetheless, through their own two-step process, my colleagues hold Whatley Kallas and Consumer Watchdog failed to carry their first-step burden in moving to strike Aetna’s complaint under section 425.16. First, adhering to this court’s decision in Sprengel, supra, 241 Cal.App.4th at pages 154-155, and the many courts of appeal decisions it followed, they posit that “‘malpractice claims that challenge the competency of an attorney’s legal services are not subject to section 425.16 because, in such cases, “the client is not suing because the attorney petitioned on his or her behalf, but because the attorney did not competently represent the client’s interests while doing so.”’” Then, relying on Chodos v. Cole (2012) 210 Cal.App.4th 692, they extend Sprengel’s conclusion to a nonclient’s claims for indemnity and contribution against an attorney based on the attorney’s alleged professional negligence. I disagree with both steps.

2. A Former Client’s Professional Negligence Action Against an Attorney Based on Litigation-related Conduct Is Protected Petitioning Activity

A lawyer’s litigation-related activities on behalf of a client ordinarily constitute protected speech or petitioning activity within the meaning of section 425.16. (See Rusheen v. Cohen (2006) 37 Cal.4th 1048, 1056 [An act in furtherance of the person’s right of petition or free speech “includes communicative conduct such as the filing, funding, and prosecution of a civil action. [Citation.] This includes qualifying acts committed by attorneys in representing clients in litigation”]; Optional Capital, Inc. v. Akin Gump Strauss, Hauer & Feld LLP (2017) 18 Cal.App.5th 95, 113 [“[i]t is well established that the protection of the anti-SLAPP statute extends to lawyers and law firms engaged in litigation-related activity”].) Yet courts of appeal, including this court in Sprengel, have categorically refused to apply section 425.16 to legal malpractice claims challenging the competency of an attorney’s litigation-related services.

Although the rationale for creating this exception to the plain meaning of section 425.16 varies slightly from opinion to opinion, all of the courts essentially agree with the explanation given in Loanvest I, LLC v. Utrecht (2015) 235 Cal.App.4th 496, 504: “Where . . . a legal malpractice action is brought by an attorney’s former client, claiming that the attorney breached fiduciary obligations to the client as the result of a conflict of interest or other deficiency in the representation of the client, the action does not threaten to chill the exercise of protected rights and the first prong of the anti-SLAPP analysis is not satisfied.” (Accord, PrediWave Corp. v. Simpson Thacher & Bartlett LLP (2009) 179 Cal.App.4th 1204, 1227-1228 [clients’ causes of action against attorneys based upon the attorneys’ acts on behalf of those clients “are not being brought ‘primarily to chill the valid exercise of the constitutional rights of freedom of speech and petition’”; accordingly, “it is unreasonable to interpret [section 425.16] to include a client’s causes of action against the client’s own attorney arising from litigation-related activities undertaken for that client”]; see Kolar v. Donahue, McIntosh & Hammerton (2006) 145 Cal.App.4th 1532, 1540 [the threat of a malpractice action by a client “encourages the attorney to petition competently and zealously,” rather than “chilling the petitioning activity”].)

In my dissenting opinion in Sprengel, I explained why this analysis, even if correct, did not justify the legal malpractice exception to section 425.16 created: “[A]lthough the Legislature’s underlying purpose in enacting section 425.16 may have been to curtail lawsuits brought primarily to chill the valid exercise of the constitutional rights of freedom of speech and petition [citation], the Supreme Court years ago rejected the argument a defendant filing a special motion to strike under this section must establish, in addition to demonstrating the gravamen or principal thrust of the complaint concerned protected activity, that it was filed with the intent to chill the exercise of constitutional speech or petition rights [citation] or that the action had the effect of chilling those rights [citation]. That a malpractice action is not brought primarily to chill the exercise of protected rights . . . is simply irrelevant to the question whether a plaintiff’s malpractice lawsuit arises from litigation-related activities.” (Sprengel, supra, 241 Cal.App.4th at p. 161 (dis. opn. of Perluss, P. J.).)

In addition to the flawed no-chill rationale discussed in my Sprengel dissent, the Supreme Court’s decisions in Wilson, supra, 7 Cal.5th 871 and Park, supra, 2 Cal.5th 1057, both decided after Sprengel, highlight another critical error in the malpractice-exception opinions. As did this court in Sprengel, supra, 241 Cal.App.4th at page 155, the courts of appeal in these malpractice cases attempted to minimize the significance of the lawyers’ petitioning activity by insisting the “principal thrust” or “gravamen” of the claims was a breach of professional obligations. (E.g., Gaynor v. Bulen (2018) 19 Cal.App.5th 864, 880 [“the client is seeking recovery for the attorney’s failure to competently represent the client’s interests and/or the attorney’s breach of loyalty owed to the client, and not to recover for injuries resulting from the attorney’s petitioning activities, even if these activities were alleged to be wrongful and harmful to the client’s interests”]; Loanvest I, LLC v. Utrecht, supra, 235 Cal.App.4th at p. 505; Freeman v. Schack (2007) 154 Cal.App.4th 719, 732.)

As discussed, however, Wilson and Park instruct that courts are to look not to the thrust or gravamen of the claim, but to the actual activity underlying the claim—the action that forms the basis for liability. (Wilson, supra, 7 Cal.5th at p. 884; Park, supra, 2 Cal.5th at p. 1063.) Representing a client in litigation notwithstanding an irreconcilable conflict of interest may constitute a breach of the duty of loyalty, but it is the act of

representation—protected petitioning activity—that forms the basis for liability. Similarly, negligent supervision of the mailing of the settlement notices may have breached the duty to act competently, but, in accordance with Wilson and Park, it was the way Whatley Kallas and Consumer Watchdog carried out the terms of the settlement agreement—protected petitioning activity—that would have formed the basis for liability if they had been sued for malpractice by their Aetna member clients.

3. Even If a Former Client’s Negligence Action Is Excepted from the Scope of Section 425.16, No Justification Exists To Extend the Exception to Nonclient Indemnity Claims

Relying on Park, supra, 2 Cal.5th 1057 and this court’s recent decision in C.W. Howe Partners Inc. v. Mooradian (2019) 43 Cal.App.5th 688, the majority correctly explains that the first-step analysis under section 425.16 depends on the nature of the defendant’s actions that give rise to his or her asserted liability, not the identity of the plaintiff who filed the lawsuit or the relationship between the plaintiff and the defendant. If litigation-related malpractice is not protected petitioning activity, therefore, it also is not protected petitioning activity when it forms the basis for a claim brought by someone who is not a former client. Because claims by Aetna members against Whatley Kallas and Consumer Watchdog for their role in the misguided mailing would not have been protected activity under Sprengel, Aetna’s claims for indemnity and contribution based on that same activity are not, as well. That is the teaching of Chodos v. Cole, supra, 210 Cal.App.4th 692, which my colleagues apply to Aetna’s claims here.

This transitive analysis, attractive as it may be, is faulty. An honest appraisal of Sprengel and similar cases demands acknowledgement that they are policy-based decisions to exclude most legal malpractice cases from section 425.16, not opinions grounded in the language of the statute or the analysis now mandated by Wilson and Park. While I believe it is properly the role of the Legislature to restrict the scope of section 425.16 where desirable (see Sprengel, supra, 241 Cal.App.4th at pp. 162-163 (dis. opn. of Perluss, P. J.)), that view has not prevailed in this context. If we continue to accept this court-created exception to section 425.16, at the very least it should be confined to those situations in which the policies that underlie it exist: lawsuits by former clients against their attorneys for litigation-related breaches of professional duties—that is, instances where the potential for a future lawsuit between the parties does not threaten a lawyer’s zealous advocacy on behalf of his or her client. (See Kolar v. Donahue, McIntosh & Hammerton, supra, 145 Cal.App.4th at p. 1540 [in contrast to a malpractice claim alleging an attorney’s incompetent handling of a previous lawsuit, “a third party suing an attorney for petitioning activity . . . clearly could have a chilling effect”]; see also Thayer v. Kabateck Brown Kellner LLP, supra, 207 Cal.App.4th at p. 158 [“if the plaintiff is a nonclient who alleges causes of action against someone else’s lawyer based on that lawyer’s representation of other parties, the anti-SLAPP statute is applicable to bar such nonmeritorious claims”].)

To expand the malpractice exception to include claims against lawyers by their adversaries not only violates the plain meaning of section 425.16 but also runs afoul of the compelling public policy generally disallowing nonclient lawsuits against lawyers other than for malicious prosecution or abuse of process. As the courts of appeal in those cases have explained, such nonclient actions create conflicting motivations for an attorney, threatening the attorney’s duty of loyalty to the client. (See California State Auto. Assn. Inter-Ins. Bureau v. Bales (1990) 221 Cal.App.3d 227, 229 [public policy in favor of preserving the undivided loyalty of lawyer to client dictates that an insurer, sued by a third party claimant for violation of the Insurance Code, may not obtain comparative equitable indemnity from the claimant’s former attorney on the theory the attorney’s negligence at least partially caused the claimant’s damage]; see also Held v. Arant (1977) 67 Cal.App.3d 748, 752 [where an attorney is retained to represent the interests of his client against persons who are actual or potential adversaries, “the possibility that one of those adversaries may seek indemnity from the attorney if he is held liable to the client can impinge upon the undivided loyalty owed by counsel”].) They also impermissibly jeopardize privileged communications. (See, e.g., McDermott, Will & Emery v. Superior Court (2000) 83 Cal.App.4th 378, 381 [derivative lawsuit by minority shareholder against corporate counsel properly dismissed because it “effectively place[d] the defendant attorney in the untenable position of having to ‘preserve the attorney client privilege (the client having done nothing to waive the privilege) while trying to show that his representation of the client was not negligent’”].)

Section 425.16 “provides a procedure for weeding out, at an early stage, meritless claims arising from protected activity.” (Baral v. Schnitt (2016) 1 Cal.5th 376, 384.) Whatever value may be served by excepting legal malpractice cases from section 425.16, the anti-SLAPP statute’s utility should not be further eroded by expanding that exception beyond the limited class of cases that gave it life.

For the foregoing reasons, I respectfully dissent.

PERLUSS, P. J.