2014-00157443-CU-OE

Demetrice Deville vs. Daniel Karalash

Nature of Proceeding: Motion to Strike

Filed By: Crone, Brian

Plaintiff and Cross-Defendant Demetrice de Ville’s (Cross-Defendant) special motion
to strike pursuant to CCP § 425.16 is denied, in part, and granted, in part, as set forth
below.

Plaintiff/Cross-Defendant filed this action against Defendants Daniel Karalash and Lori
Porter (Cross-Complainants) for wage and hour violations, retaliation in violation of
Labor Code § 1102.5, false imprisonment, and intentional infliction of emotional
distress. Cross-Complainants filed a cross-complaint asserting numerous causes of
action, including causes of action for fraudulent inducement, “failure to mitigate
damages” and “race-based retaliation”, which are the subject of the instant motion.

The Court’s review of an anti-SLAPP motion involves a two-prong process. (Navellier
v. Sletten (2002) 29 Cal.4th 82, 88.) First, Cross-Defendant must establish that the
challenged causes of action arose from “and act…in furtherance of [Cross-
Defendant’s] right of petition or free speech.” (CCP § 425.16(b)(1).) If Cross-
Defendant meets that burden, then the second prong requires Cross-Complainants to
establish “that there is a probability that the plaintiff will prevail on the claim.” (Id.)
Only a cause of action that satisfies both prongs of the anti-SLAPP statute-i.e., that
arise from protected speech or petitioning and lacks even minimal merit is a SLAPP,
subject to being stricken under the statute. (Oasis West Realty, LLC v. Goldman
(2011) 51 Cal.4th 811, 819-820; citations omitted.)

Cross-Defendant argues that the first, fourth and fifth causes of action all arise from
protected activity because they are all based on the fact that Cross-Defendant filed the
instant lawsuit against them. The Court reviews each cause of action in turn.

First Cause of Action (Fraudulent Inducement)

While not a model of clarity, the gist of the first cause of action appears to consist of
allegations that Cross-Defendant made numerous representations regarding her status
as an independent contractor and her skills which induced Cross-Complainants to
allow Cross-Defendant to work in their law office without a compensation agreement.
(Cross-Comp. ¶¶ 10, 19-20.) Cross-Complainants allege that they allowed Cross-
Defendant to use their office without paying rent, provided her training as she
requested, gave her leads and connections to other attorneys expressing a desire for
paralegal work, and assisted her in becoming an independent contractor with the
Conflict Criminal Defense Panel. Cross-Complainants allege that they were damaged
in that they suffered a “loss of income, had to issue credits for previous work done by
[Cross-Defendant ]; as well as loss of future income…” (Cross-Comp. ¶ 28.) Cross-
Defendant argues that the first cause of action arises from the protected activity of her
filing the complaint because the cross-complaint contains numerous references to the
complaint and was filed to retaliate against her for filing a complaint. She argues that
in reality the cause of action is a defense to her claim that she was an employee by
alleging that she was nothing more than an uncompensated independent contractor.

In opposition, Cross-Complainants argue that their cross-complaint was compulsory
and thus based on conduct preceding the filing of the complaint and was not based
upon the protected activity of Cross-Defendant filing the complaint even if the cross-
complaint is viewed as being filed in retaliation for filing the complaint. Compulsory
cross-complaints “would rarely, if ever, qualify as a SLAPP suit arising from petition
activity. By definition, a ‘related cause of action is ‘a cause of action which arises out
of the same transaction, occurrence, or series of transactions or occurrences as the
cause of action which the plaintiff alleges in his complaint.’ [citation omitted] The
SLAPP suit is not ‘related’ to the transaction or occurrence which is the subject of the
plaintiff’s complaint but arises out of the litigation process itself.’” (Kajima Engineering
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& Construction, Inc. v. City of Los Angeles (2002) 95 Cal.App.4 921, 934 [quoting
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Church of Scientology v. Wollersheim (1996) 42 Cal.App.4 628, 651].) In the instant action, the Court finds that Cross-Defendant failed to meet her burden to
show that the first cause of action for fraud arises from the protected activity of her
filing the instant lawsuit. While true the first cause of action references Cross-
Defendant complaint (e.g. in that it alleges fees and costs have been incurred in
defending the complaint, alleges that Cross-Complainants are “stunned” by how their
kindness to Cross-Defendant was “repaid with this meritless litigation”), it is not based
upon the filing of the complaint but rather is based on conduct preceding the filing of
the complaint, specifically, alleged misrepresentations that Cross-Defendant made to
Cross-Complainants to induce them to allow her to use office space, to provide her
training, etc. for which they allege they were damages in the form of lost income and
having to issue credits for work performed by Cross-Defendant . This cause of action
arises out of the same transaction or occurrence as Cross-Defendant’s complaint and
is thus a compulsory cause of action which “would rarely, if ever, qualify as a SLAPP
suit arising from petition activity.” (Kajima Engineering & Construction, Inc., supra, 95
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Cal.App.4 at 934.) While Cross-Defendant may view the cause of action as
retaliatory and without merit given her contention that it is really an affirmative defense
to her action in which she claims she was an employee, Cross-Defendant is not
without remedy. “If a cross-defendant believes that a cross-complaint has been filed
for ‘an improper purpose, such as to harass or to cause unnecessary delay or
needless increase in the cost of litigation,’ or that the claims against [her] are frivolous
or lacking in evidentiary support, then it may move for sanctions, including attorneys
fees or other expenses, to be awarded in the court’s discretion. (See § 128.7, subds.
(b)-(d).) The anti-SLAPP statute, however, is not the appropriate remedy.” (Kajima
Engineering & Construction, Inc., supra, at 934.)

As a result, the Court concludes that Cross-Defendant failed to show that the first
cause of action for fraudulent inducement arose from “any act…in furtherance of [her]
right of petition or free speech.” (CCP § 425.16(b)(1).) Given this finding, the Court
does not reach the second prong of the anti-SLAPP analysis to determine whether
Cross-Complainants established that “that there is a probability that [they] will prevail
on the claim.” (Id.) The Court notes that Cross-Complainants made no argument in
this regard, as they simply argued that Cross-Defendant did not meet the first prong of
the analysis.

The motion as to the first cause of action is denied.

Fourth Cause of Action (Failure to Mitigate)

In this cause of action, Cross-Complainants allege a basic contribution cause of action
alleging that they are not responsible for the damages in Cross-Defendant’s complaint
but to the extent that they are held liable, Cross-Defendant is obligated to reimburse
them pursuant to a right of contribution.

While, Cross-Defendant is correct that the cause of action relates to her complaint, the
court would again note it is not based upon the act of filing her complaint. Rather, the
cause of action merely asserts a right of contribution based upon the proportionate
fault of Cross-Defendant in causing any damages. Such fault would be based upon
conduct that preceded the filing of the complaint, as opposed being based upon the
act of filing the complaint. The critical distinction is whether the protected activity
merely preceded or triggered the lawsuit, or whether it is the basis of the lawsuit. (City
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of Alhambra v. D’Ausilio (2011) 193 Cal.App.4 1301, 1307; Clark v. Mazgani (2009)
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170 Cal.App.4 1281, 1287.) “[t]he mere fact that an action was filed after protected
activity took place does not mean that it arose from that activity.” (City of Cotati v.
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Cashman (2002) 29 Cal.4 69, 76-77.) Cross-Defendant’s complaint is not the basis
of the instant cause of action, but rather the underlying conduct that gave rise to her
causes of action and which preceded the filing of the complaint is the basis of the
cause of action. Again, the fact that the cause of action is, according to Cross-
Defendant , nothing more than an affirmative defense, does not alter the analysis.
That is, to the extent that Cross-Defendant views the cause of action as meritless and
retaliatory, she has a remedy, just not the anti-SLAPP statute. (Kajima Engineering &
Construction, Inc., supra, at 934.)

The Court concludes that Cross-Defendant failed to show that the fourth cause of
action for failure to mitigate arose from “any act…in furtherance of [her] right of petition
or free speech.” (CCP § 425.16(b)(1).) Given this finding, the Court does not reach
the second prong of the anti-SLAPP analysis to determine whether Cross-
Complainants established that “that there is a probability that [they] will prevail on the
claim.” (Id.)

Fifth Cause of Action (Race-Based Retaliation)

In this “cause of action” Cross-Complainants allege that Cross-Defendant was
reprimanded numerous times for abusive and unprofessional conduct at Cross-
Complainants’ office and engaged in racially inflammatory activity in an attempt to
create a distraction from her incompetence. (Cross-Comp. ¶¶ 61-63.) They allege
that Cross-Defendant intended to create an impression that she was a victim of racial
oppression to blame others for her deficiencies. They allege that “[a]t issue in this
case, at all times relevant herein, is [Cross-Defendant’s] filing of a frivolous and
mendacious Complaint, an act of retaliation for being reprimanded for unsuitable work
product and her revolting attempt to introduce racial stereotypes into [Cross-
Complainants’] workplace.” (Cross-Comp. ¶ 66.)

Here, in stark contract to the first and fourth causes of action, the fifth cause of action
is expressly based upon Cross-Defendant’s conduct in filing the complaint. Indeed,
Cross-Complainants plainly allege that Cross-Defendant retaliated against them by
filing the complaint. (Cross-Comp. ¶ 66.) The cause of action is not therefore based
upon conduct that preceded the lawsuit, it is expressly based upon the lawsuit. Cross-
Defendant’s conduct in filing the complaint clearly falls within the anti-SLAPP statute
as is “any act…in furtherance of [her] right of petition or free speech.” (CCP § 425.16
(b)(1).) To the extent Cross-Complainants argue that the cause of action is
compulsory, this does not exempt them from the anti-SLAPP statute as a matter of
law. While true, the above cited authority indicates that a true compulsory cross-
complaint would rarely be subject to the anti-SLAPP statute, the statute makes no
specific exception for compulsory cross-complaints. Thus, compulsory cross-
complaints cannot be excluded from the purview of the anti-SLAPP statute. In any
event, the critical question is whether the challenged cross-claim arose out of an act in
furtherance of Cross-Defendant’s right of petition/free speech. This question focuses
on Cross-Defendant’s conduct giving rise to the asserted liability and whether that
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conduct involved petitioning activity. (Navellier v. Sletten (2002) 29 Cal.4 82, 92.)
Here, the conduct giving rise to the asserted liability in this cause of action for “race-
based retaliation) is Cross-Defendant’s alleged “frivolous and mendacious Complaint”
and is clearly conduct that involved Cross-Defendant’s petitioning activity.

The Court concludes that Cross-Defendant established that the fifth cause of action arose from “any act…in furtherance of [her] right of petition or free speech.” (CCP §
425.16(b)(1).) The burden thus shifts to Cross-Complainants to establish that “that
there is a probability that [they] will prevail on the claim.” (Id.) Cross-Complainants
made no showing in this regard, simply arguing that Cross-Defendant did not meet the
first prong of the analysis. In any event, even if Cross-Complainants made such an
argument, as correctly pointed out by Cross-Defendant, there is no cause of action for
retaliation where the employee is alleged to have retaliated against the employer.
Cross-Complainants cite no authority to support such a cause of action. The motion
as to the fifth cause of action is granted.

In sum, the motion to strike pursuant to CCP § 425.16 is denied as to the first and
fourth causes of action and granted as to the fifth cause of action. Attorneys’ fees may
be sought by way of a separately noticed motion.

Cross-Defendant shall submit a formal order for the court’s signature pursuant to CRC
rule 3.1312.