Case Number: BC722741 Hearing Date: December 19, 2019 Dept: 58

Judge John P. Doyle

Department 58

Hearing Date: December 19, 2019

Case Name: KS World Inc. v. Funabiki, et al.

Case No.: BC722741

Motion: Anti-SLAPP Motion

Moving Party: Defendant Yusuke Funabiki

Opposing Party: Plaintiff KS World Inc.

Tentative Ruling: The Anti-SLAPP Motion is granted.

This an action in which Plaintiff alleges that Defendant breached a settlement agreement by submitting a declaration in a class action lawsuit against Plaintiff. On September 24, 2018, Plaintiff filed the operative Complaint for breach of contract.

I. Anti-SLAPP Motion

Defendant brings an Anti-SLAPP Motion arguing that (1) Plaintiff’s breach of contract claim arises from protected activity to the extent it challenges Defendant’s testimony in a lawsuit and (2) there is no probability of prevailing on such claim because the contract provision sought to be enforced is void and the litigation privilege applies.

(a) Legal Standard

Code of Civil Procedure section 425.16 sets forth the procedure governing anti-SLAPP motions. In pertinent part, the statute states, “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.” (Code Civ. Proc. § 425.16(b)(1).) The purpose of the statute is to identify and dispose of lawsuits brought to chill the valid exercise of a litigant’s constitutional right of petition or free speech. (Code Civ. Proc. § 425.16(a); Sylmar Air Conditioning v. Pueblo Contracting Services, Inc. (2004) 122 Cal.App.4th 1049, 1055-1056.)

Courts employ a two-step process to evaluate anti-SLAPP motions. (Equilon Enterprises v. Consumer Cause, Inc. (2002) 29 Cal.4th 53, 61.) To invoke the protections of the statute, the defendant must first show that the challenged lawsuit arises from protected activity, such as an act in furtherance of the right of petition or free speech. (Ibid.) From this fact, courts “ ‘presume the purpose of the action was to chill the defendant’s exercise of First Amendment rights. It is then up to the plaintiff to rebut the presumption by showing a reasonable probability of success on the merits.’ ” (Ibid.) In determining whether the plaintiff has carried this burden, the trial court considers “the pleadings, and supporting and opposing affidavits stating the facts upon which the liability or defense is based.” (Code Civ. Proc. § 425.16(b)(2); see Soukup v. Law Offices of Herbert Hafif (2006) 39 Cal.4th 260, 291 (“Soukup”).)

(b) Protected Activity

An “ ‘act in furtherance of a person’s right of petition or free speech under the United States or California Constitution in connection with a public issue’ includes: (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, or (4) 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.” (Code Civ. Proc. § 425.16(e).)

The instant suit arises from protected activity under Code Civ. Proc. § 425.16(e)(1) to the extent the challenged conduct is Defendant’s submission of declaration in a lawsuit. (Compl. ¶¶ 10-20.) That the first cause of action is framed as breach of contract does not aid Plaintiff because “[n]either the form of the complaint nor the primary right at stake is determinative.” (Baral v. Schnitt (2016) 1 Cal.5th 376, 395.) Further, the Court rejects the notion that the subject settlement agreement operates as a waiver of anti-SLAPP protections.

(c) Minimal Merit

On the second component of the analysis, courts employ a “summary-judgment-like” procedure, “accepting as true the evidence favorable to the plaintiff and evaluating the defendant’s evidence only to determine whether the defendant has defeated the plaintiff’s evidence as a matter of law.” (Gerbosi v. Gaims, Weil, West & Epstein, LLP (2011) 193 Cal.App.4th 435, 444.) In other words, the Court does not assess credibility, and the plaintiff is not required to meet the preponderance of the evidence standard. The Court accepts as true the evidence favorable to the plaintiff, who need only establish that his or her claim has “minimal merit” to avoid being stricken as a SLAPP. (Soukup, supra, 39 Cal.4th at p. 291.)

Plaintiff’s claim for breach of contract lacks minimal merit because it relies on a provision which is void as against public policy. Indeed, the subject provision provides, “FUNABIKI specifically represents that he will not in the future file, participate in (unless required by law), encourage, or instigate the filing of, or recover any wages, penalties, settlements or judgments in connection with, any lawsuit by any party in any state or federal court, or of any proceeding before any local, state, or federal agency, based upon events occurring prior to the date of execution of this Agreement, claiming [Plaintiff] have violated any local, state or federal laws, statutes, ordinances or regulations, or concerning any allegations of tortious conduct and/or violations of contractual relationships of any kind.” (Compl. ¶ 10.) Such provision is unenforceable as it seeks to preclude Defendant’s testimony in a lawsuit. (McPhearson v. Michaels Co. (2002) 96 Cal.App.4th 843, 847 [“Indeed, it would be contrary to public policy to permit a party to litigation to dissuade or otherwise influence the testimony of a percipient witness through a private agreement. (See Evid. Code, § 911 [unless otherwise provided by statute, no one has a privilege to refuse to be a witness; to refuse to disclose a matter or produce a writing, object, or other thing; or to insist that another person not be a witness, not disclose a matter, or not produce a writing, object, or other thing]; Pen. Code, § 136.1 [it is a crime to knowingly and maliciously prevent or dissuade a witness from attending or giving complete and truthful testimony in a judicial proceeding].)”].)

But, even if this were not true, the Court agrees with Defendant that the breach of contract claim is barred by the litigation privilege.

The litigation privilege set forth in Civ. Code § 47 generally applies “to any communication (1) made in judicial or quasi-judicial proceedings; (2) by litigants or other participants authorized by law; (3) to achieve the objects of the litigation; and (4) that have some connection or logical relation to the action.” (Silberg v. Anderson (1990) 509 Cal.3d 205, 212.) The “principle purpose of [the litigation privilege] is to afford litigants . . . the utmost freedom of access to the courts without fear of being harassed subsequently by derivative tort actions.” (Id. at p. 213.) “The litigation privilege is . . . relevant to the second step in the anti-SLAPP analysis in that it may present a substantive defense a plaintiff must overcome to demonstrate a probability of prevailing.” (Flatley v. Mauro (2006) 39 Cal.4th 299, 323.) Statements made in anticipation of litigation are subject to the litigation privilege. (Briggs v. Eden Council for Hope and Opportunity (1999) 19 Cal.4th 1106, 1115.)

“[W]hether the litigation privilege applies to an action for breach of contract turns on whether its application furthers the policies underlying the privilege.” (Wentland v. Wass (2005) 126 Cal.App.4th 1484, 1492.)

Here, the litigation privilege applies because (1) the challenged conduct is Defendant’s testimony in a lawsuit and (2) barring the subject settlement provision would support the privilege’s purpose “to ensure free access to the courts, promote complete and truthful testimony, encourage zealous advocacy, give finality to judgments, and avoid unending litigation.” (Wentland, supra, 126 Cal.App.4th at p. 1492.)

Because Plaintiff’s breach of contract claim lacks minimal merit, the anti-SLAPP Motion is granted.