CIV525758 N.A. SALES COMPANY, INC. VS. HAE-SUK LEE, et AL.

N.A. SALES COMPANY, INC. BISHOP RANCH GATEWAY INC.
BRIAN H. SONG R. KENNETH BAUER

SPECIAL MOTION TO STRIKE (SLAPP) TENTATIVE RULING:

ANTI-SLAPP MOTION TO STRIKE: Cross-Defendants’ Anti-SLAPP Motion to Strike Cross-Complainant Hae Suk Lee’s CrossComplaint is GRANTED.

The Cross-Complaint contains one cause of action for abuse of process against CrossDefendants. Cross-Complainant alleges that he filed an appeal of the default judgment entered in this action on June 2015, and in March 2018, the Court of Appeal directed the trial court to vacate the default and default judgment against him. (Cross-Complaint, ¶ 16.) In light of the order, Cross-Complainant claims he demanded that Cross-Defendants dismiss the enforcement of judgment action against Cross-Complainant in South Korea, and that they have refused. Instead, Cross-Complainant alleges that Cross-Defendants continue to prosecute the enforcement action despite that default judgment has been vacated. (Cross-Complaint, ¶ 17.)

Cross-Defendants now brings this special motion to strike (“anti-SLAPP”) the Cross-Complaint pursuant to Code of Civil Procedure section 425.16. In order to invoke the protection of the antiSLAPP statute, the only thing that a defendant needs to show is that the challenged lawsuit arose from an act on the part of the defendant in furtherance of the right of petition or free speech. (Equilon Enterprises LLC v Consumer Cause, Inc. (2002) 29 Cal.4th 53, 61.) Once a defendant meets this burden, the burden shifts to plaintiff to rebut the presumption by showing a reasonable probability of success on the merits. (Ibid.) 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. (Premier Med. Mgmt Systems, Inc. v. Cal. Ins. Guar. Assn. (2006) 136 Cal.App.4th 464, 476.) The court considers the pleadings, and supporting and opposing affidavits stating the facts upon which the liability or defense is based. (Governor Gray Davis Com. v. American Taxpayers Alliance (2002) 102 Cal.App.4th 449, 460–461.) The motion to strike should be granted if the facts do not support a claim for relief. (Id.)

1. CROSS-DEFENDANT SHOW THAT THE CROSS-COMPLAINT ARISES FROM PROTECTED ACTIVITY UNDER C.C.P. SECTION 425.16.

Cross-Defendants have satisfied their burden of establishing that the abuse of process claim in the Cross-Complaint arises from an act in furtherance of Cross-Defendant N.A. Sales Company,
Inc.’s (“NAS”) petition rights under C.C.P. section 425.16. CCP section 425.16(e)(2) provides that an “act in furtherance of a person’s right of petition or free speech … in connection with a public issue” includes “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.” (C.C.P. § 425.16(e)(2).)

To meet their burden, Cross-Defendants provide a declaration from Youngjoon Jeon (“Jeon”), NAS’ attorney in Korea, stating that he filed separate Korean attachment proceedings and Korean judgment enforcement proceedings in Korea on behalf of NAS. (See Jeon Decl. ¶¶ 7-17.) For the Korean attachment proceedings, Jeon states that the Korean court granted attachment orders in 2014 and 2016 (“Korean attachment orders”), for a total amount of $360,000 for the two attachments. (Jeon Decl. ¶¶ 7-9.) A “Korean attachment” is explained to be a provisional remedy available under Korean law, similar to the attachment proceedings in the U.S, whereby creditors seek to preserve the assets of debtors so that such assets will be available for execution of judgment after the litigation is completed. (Jeon Decl. ¶ 10.) After the Court of Appeal vacated the default judgment against Lee and other defendants in this action in March 2018, Lee challenged the Korean attachment orders in April 2018. (Jeon Decl. ¶ 11.) The Korean court held several hearings in June and July 2018, at which Jeon appeared. (Jeon Decl. ¶ 11.) Lee made the challenge, among others, on the basis of the Court of Appeal’s decision. (Jeon Decl. ¶ 11.) On July 25, 2018, the Korean court issued an order denying Lee’s challenge and ruling that the attachment order remain in force. (Jeon Decl. ¶ 13.) Jeon also filed a separate Korean judgment enforcement proceeding for a writ of execution in May 2015 after a default judgment was obtained against Lee in this action. (Jeon Decl. ¶ 14.) This was a separate proceeding from the Korean attachment proceedings. (Ibid.) After the Court of Appeal reversed the default judgment, NAS voluntarily withdrew this proceeding, which Lee consented to in writing, and the Korean court accepted this voluntary withdrawal. (Jeon Decl. ¶¶ 16-17, and Exhs. 4-6.) Therefore, CrossDefendants show that Cross-Complainant’s claim for abuse of process arises from NAS’ exercise of its petition rights.

In opposition, Cross-Complainant argues only that the Korean court proceedings are not “protected activity” because the filing of a lawsuit in a foreign country is not protected under the United States or California Constitutions, and thus does not fall within the protections of the antiSLAPP statute. Cross-Complainant cites to Guessous v. Chrome Hearts, LLC (2009) 179 Cal.App.4th 1177 (“Guessous”) in support.

In response, Cross-Defendants assert that the anti-SLAPP may apply to foreign proceedings, citing Summerfield v. Randolph (2011) 201 Cal.App.4th 127 (“Summerfield”) [finding that application to Zimbabwe court was protected by the anti-SLAPP statute because it was made in connection with proceedings pending in Los Angeles court].)

After reviewing both Guessous and Summerfield, the court finds that the rationale in Summerfield is controlling here. The Court of Appeal in Summerfield, supra, distinguished Guessous, supra, stating:

Topaz’s [plaintiff’s] reliance on Guessous, supra, 179 Cal.App.4th 1177, 102 Cal.Rptr.3d 214 is misplaced. In Guessous, the plaintiff’s action was based on the defendant’s petitioning activity in a foreign court. None of the issues presented to the foreign court were under consideration in an official proceeding in the United States. The Guessous court did not have reason to consider whether a statement made in a foreign court could be protected under the anti-SLAPP statute as a statement made in connection with an issue under consideration by a judicial body in the United States.
(Id. at 137.) Here, NAS filed both enforcement of judgment and attachment proceedings in Korean court in connection with issues under consideration in this court. Accordingly, CrossDefendants have satisfied their burden of showing that they engaged in “protected activity” under the anti-SLAPP statute.

2. CROSS-COMPLAINANT FAILS TO ESTABLISH A PROBABILITY OF PREVAILING ON HIS ABUSE OF PROCESS CLAIM.

Since Cross-Defendants have met their burden, the burden shifts to Cross-Complainant to establish that there is a probability that he will prevail on his claim. Cross-Complainant fails to meet his burden here as he has not presented any evidence, including countering CrossDefendants’ evidence that NAS dismissed the enforcement of judgment action once the Court of Appeal reversed the judgment, and that only the attachment proceedings remain in the Korean court.

Further, Cross-Complainant has not presented any evidence to overcome the litigation privilege under Civil Code section 47(b) raised by Cross-Defendants. 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.) Cross-Complainant contends that the litigation privilege does not apply because the proceedings are not reviewable by a writ of mandate pursuant to C.C.P. section 1084, et seq. (See Civil Code § 47(b)(4).) However, Cross-Defendants point out that Cross-Complainant improperly relies solely on section 47(b)(4) without acknowledging section 47(b)(2), upon which CrossDefendants rely. Civil Code section 47(b) provides that a privileged publication or broadcast is one made in any judicial proceeding. (See Civil Code § 47(b)(2).) While Cross-Complainant further argues that this privilege does not apply to any foreign judicial proceeding, he cites no authority for this position. In contrast, Cross-Defendants provide authority to support that this litigation privilege applies to proceedings abroad. (See Beroiz v. Wahl (2000) 84 Cal.App.4th 485.)

Cross-Complainant fails to establish a probability of prevailing on his Cross-Complaint. The Cross-Complaint is hereby ORDERED STRICKEN pursuant to Code of Civil Procedure section 425.16.

3. ATTORNEY’S FEES AND COSTS .

Cross-Defendants ask that the court award attorney’s fees and costs of $10,000, or alternatively, set a separate hearing to determine the reasonableness of the attorney’s fees. A prevailing defendant is entitled to recover attorney’s fees and costs under C.C.P. section 425.16(c)(1). Since Cross-Defendants indicate that they do not yet have the total amount of attorney’s fees incurred at this time, Cross-Defendants are to file and serve a separately noticed motion for attorney’s fees and costs in connection with this motion.

Cross-Complainant’s request for attorney’s fees based on C.C.P. section 425.16(c)(1) is DENIED.

If the tentative ruling is uncontested, it shall become the order of the Court, pursuant to Rule 3.1308(a)(1), adopted by Local Rule 3.10, effective immediately, and no formal order pursuant to Rule 3.1312 or any other notice is required as the tentative ruling affords sufficient notice to the parties.