Opinion
H046726
03-29-2021
VALERIE PREVITE, Cross-complainant and Respondent, v. JOHN J. GUERRA, JR., Cross-defendant and Appellant.
NOT TO BE PUBLISHED IN OFFICIAL REPORTS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 This opinion has not been certified for publication or ordered published for purposes of rule 8.1115. (Santa Clara County Super. Ct. No. CV315122)
Respondent Valerie Previte (Previte) sought to collect over $11 million on a contract between her husband, Jack Previte, and the company that employed him until his death in 2016. That company is one of several assets of the Cyril G. Barbaccia and Lena M. Barbaccia Revocable Intervivos Trust (the Barbaccia Trust). Appellant John J. Guerra is the president and general manager of the company and co-trustee of the Barbaccia Trust. Guerra asked the company's attorneys to investigate Previte's demand. The investigation led to the filing of a civil complaint against her, alleging that her husband had used illegal means to procure the contract, which was void and unenforceable. Previte brought a cross-complaint against Guerra and others, alleging breach of contract and related tort causes of action arising from the company's refusal to honor the contract and Guerra's alleged interference with contract and other economic benefits promised to Previte. Guerra filed a special motion to strike the cross-complaint as a "SLAPP" (strategic lawsuit against public participation) under Code of Civil Procedure section 425.16, which the trial court denied because Guerra failed to show that Previte's claims arose from any activity protected by section 425.16.
We at times refer to members of the Barbaccia and Previte families by first name to avoid confusion.
Unspecified statutory references are to the Code of Civil Procedure.
For the reasons explained below, we affirm the denial of Guerra's anti-SLAPP motion.
I. FACTS AND PROCEDURAL BACKGROUND
We draw the facts from the pleadings and declarations submitted in the trial court upon which Guerra's alleged liability is based. (§ 425.16, subd. (b)(2).)
Lena Barbaccia and her husband, Cyril Barbaccia, who died in October 2016, established the Barbaccia Trust in 1982. Through business entities held by the trust, including Barbaccia Properties Holdings, LLC (BPH) and CGB Investments, LLC (CGB), the Barbaccias owned and managed interests in commercial properties including apartments, mobile home parks, and office buildings. The property relevant here is a development called the Palm Valley Apartments.
Jack Previte was a friend and business advisor who managed the Barbaccias' businesses and trust finances for more than 20 years, until his death in March 2016. In addition to his role as general manager for BPH and CGB, Jack served as trustee for an irrevocable trust that the Barbaccias established for the benefit of their disabled daughter and sole surviving child. Jack also assumed the duties of trustee for the Barbaccia Trust, acting as the Barbaccias' agent in managing the businesses and properties. A 10-year, 2004 management agreement executed by the Barbaccias delegated their duties as trustees of the Barbaccia Trust to Jack and set the terms of his compensation (the "management agreement"). The management agreement made Jack responsible for managing the trust properties, including the business interests of BPH and CGB in Palm Valley Apartments and in three mobile home parks known as Magic Sands, Villa Teresa, and La Buona Vita.
Other agreements purportedly followed the management agreement, including a 2007 "Asset Manager Incentive Agreement" between Jack Previte and the Barbaccias (the "incentive agreement"). The incentive agreement provided for payment to Jack of up to 6 percent of the gross sales price received by BPH upon the sale of its interests in the Palm Valley Apartments, in exchange for his management services and his timely completion of tasks related to financing, construction, and lease-up of the property. Jack apparently completed each of the Palm Valley project phases on time.
John Guerra met the Barbaccias through Guerra's electrical contracting business. Cyril hired Guerra's company to perform electrical work on one of the Barbaccia properties in 1999. Guerra continued to perform work for the Barbaccias and became friends with Cyril and Lena. When Jack Previte died in March 2016, the Barbaccias asked Guerra to take Jack's former position as general manager of BPH and CGB. They appointed Guerra co-trustee of the Barbaccia Trust in August 2016. The Barbaccias' estate planning attorney, John Willoughby, drafted that and other amendments to the Barbaccia Trust.
A. Previte's Demand Under the 2007 Incentive Agreement and the Plaintiffs' Lawsuit Against Her
In January 2017, BPH sold its interests in the Palm Valley Apartments for $183 million. According to Guerra, Previte contacted him and claimed that Jack had a contract with BPH which provided for the payment of 6 percent of the gross sales price received by BPH upon the sale of its interests in Palm Valley Apartments. Guerra told Previte that he would look into the matter. On January 31, 2017, Guerra informed Previte in writing that BPH's legal counsel would be handling the demand. According to Previte, Guerra reassured her that she had nothing to worry about and everything would be made right with regard to the Palm Valley sale. Guerra then refused, without explanation, to pay the amount owed under the incentive agreement.
Previte's attorney made a formal demand on BPH shortly thereafter. The February 2017 demand letter stated that Previte was the successor beneficiary of the incentive agreement and explained that the sale of BPH's ownership interest in the Palm Valley Apartments triggered payment of a vested 6 percent incentive payment under the agreement, totaling $11,760,000, plus interest accruing. Counsel for BPH responded in writing that they were investigating the claim. The investigation took months.
By August 2017, counsel for BPH had determined that Previte's claim should be denied because Jack Previte had not obtained the Barbaccias' valid consent in procuring the incentive agreement. Around that same time, before BPH communicated its position to Previte's counsel, Previte filed an arbitration with JAMS (judicial arbitration and mediation services) under the arbitration clause of the incentive agreement. BPH responded that JAMS did not have jurisdiction, because the incentive agreement and its arbitration clause were not formed by valid consent.
Counsel for BPH then filed the underlying action on behalf of BPH, CGB, and Guerra, solely in his capacity as co-trustee of the Barbaccia Trust. Lena Barbaccia, represented by separate counsel, joined the complaint as co-plaintiff, individually and in her capacity as co-trustee of the Barbaccia Trust. BPH, CGB, Guerra, and Lena (together, plaintiffs) later filed a first amended complaint, referred to here as the complaint, alleging causes of action ranging from rescission and restitution to breach of fiduciary duty and conversion.
The complaint generally alleges that Jack Previte misappropriated funds from the Barbaccia Trust, BPH, and CGB and transferred them through a series of transactions to the Jack Previte and Valerie Previte Revocable Living Trust (the Previte Trust), for which Previte serves as trustee and beneficiary. Plaintiffs allege that Jack used company assets to pay off mortgages on the primary and secondary residences owned by the Previte Trust, to make unauthorized "gifts" and "distributions" to individuals who assisted him, and to transfer millions of dollars from BPH to CGB, which Previte has asserted is owned by the Previte Trust. They claim that Jack also purported to procure, through illicit means, authorization for compensation not specified in the 2004 management agreement.
Plaintiffs allege that Jack contrived the 2007 incentive agreement as one such way to enrich himself at the expense of the businesses under his charge. He allegedly directed the drafting of the agreement sometime around October 2007, dictated its terms, and had the document backdated to January 5, 2007, to give the impression that it was created in advance of the incentives outlined in the agreement. The Barbaccias were not represented in connection with the incentive agreement or apprised of its terms. Lena has declared that she does not recall being told of the incentive agreement or signing the signature page, which is a standalone page bearing no other text or indication of the preceding pages. According to plaintiffs, most or all of the tasks listed in the incentive agreement were already completed by 2007 and compensated under the management agreement. Plaintiffs seek to invalidate the incentive agreement and to recover the money received or converted by the Previte Trust.
B. Previte's Cross-complaint and Allegations Against Guerra
Previte filed a cross-complaint against BPH, Lena Barbaccia, and John Guerra for "breach of contract arising from BPH's refusal to pay Valerie Previte her six percent share of BPH's sale of its portion of the Palm Valley Apartments." The cross-complaint names Guerra individually and in his capacity as co-trustee of the Barbaccia Trust. It asserts causes of action as to all the plaintiffs/cross-defendants for breach of contract and declaratory relief, and against Guerra for inducing breach of contract, intentional interference with economic advantage, intentional interference with contract, and interference with expected inheritance.
The cross-complaint generally alleges that Jack and Valerie Previte were close personal friends of Lena and Cyril Barbaccia for many decades, that Jack devoted himself to his management roles for CGB and BPH, and that his sudden death in March 2016 "crushed" Cyril and left him unable or unwilling to control his companies or his assets. It alleges that when Jack died, Guerra immediately "began to seize control" of the Barbaccias' companies and fortunes and unilaterally announced his appointment as president of the companies. It alleges that when Cyril passed away in October 2016 at the age of 89, Guerra "used the opportunity to isolate Lena Barbaccia," who turned 90 in August 2017 and was vulnerable with "failing" mental ability, to remove trusted accountants, advisors, and attorneys, and to control her decisions and influence her into changing her family's estate plans. It alleges that Guerra has acted to take away Previte's expected inheritance, to prevent BPH and the Barbaccia Trust from paying her, and has threatened to refuse payment upon the future sale of Villa Teresa and Magic Sands by refusing to acknowledge the validity of the incentive agreement.
As to Previte's claim to compensation, she states that the incentive agreement, made effective January 5, 2007, was drafted and reviewed by counsel for the Barbaccias, who approved of its terms and signed the agreement in front of a notary in January 2009. The cross-complaint alleges that when Previte's requests for payment went unheeded, she filed an arbitration claim, and Guerra responded by suing her and accusing her and her deceased husband of fraud and theft—though no such accusations ever arose during Jack's lifetime.
We outline the allegations of the cross-complaint in more detail in the anti-SLAPP analysis, post (part II.B.2.).
C. Guerra's Special Motion to Strike the Cross-complaint
Guerra responded to Previte's cross-complaint with a special motion to strike the cross-complaint under the anti-SLAPP statute (§ 425.16). Guerra argued that the claims alleged against him as cross-defendant arose from protected activity, namely the filing and prosecution of the complaint against Previte and any litigation-related communications about the investigation into her demand, and that Previte could not demonstrate a probability of prevailing on the merits of her claims against him. Guerra submitted declarations and exhibits, including his own declaration and that of Lena Barbaccia, in support of his special motion to strike.
Guerra stated that Lena and Cyril asked him in March 2016 to take over managing the Barbaccias' companies after Jack Previte died, then in August 2016 asked him to serve as co-trustee of the Barbaccia Trust. When Previte contacted him in January 2017 about the incentive fee owed to her as the beneficiary of Jack's contract with BPH, he told her he would "look into the matter" because of the magnitude of the claim. Guerra informed Previte that month that he had hired counsel on behalf of BPH "to represent it in connection with . . . any claims to the proceeds of the sale of any of the LLC's assets." After that point, Guerra relied on BPH's attorneys to review and handle the demand.
Guerra attested that he authorized the filing of the complaint as CEO and manager of BPH, and as co-trustee of the Barbaccia Trust, and that the decision to deny Previte's claim was "based entirely" on the facts alleged in the complaint. At no time did Guerra influence or induce Lena, who is independently represented, to join the lawsuit as a plaintiff. Guerra disclaimed any animus toward Previte or her family and disclaimed any financial interest or stake in the denial of her claim. He asserted that neither he, nor any friend or family member, is a beneficiary of the Barbaccia Trust, or of any other trust or will created by Lena or Cyril.
Lena Barbaccia attested that, at 90 years old, she is in "excellent health, both mentally and physically." She is the trustor, co-trustee, and current beneficiary of the Barbaccia Trust, which is revocable and can be changed by her at any time. Lena confirmed that it was Cyril who suggested that Guerra take over as manager of the businesses in March 2016, that she had agreed with the suggestion, and that Guerra played no part in that decision. She also confirmed her retention of independent counsel and her reliance on that counsel in all matters related to the litigation. Lena disputed Previte's claims about Guerra's alleged undue influence. She stated that Guerra has not asked, and she has "no intention," of making him or any of his friends or family beneficiaries of the trust. She and Cyril decided together to amend the Barbaccia Trust in May 2016 to remove the distributions identified by Previte in her cross-complaint, and decided in August 2016 to make Guerra co-trustee. Guerra had no role in the amendments that Cyril and Lena, with the assistance of their attorney, made to the Barbaccia Trust.
Previte filed a written opposition to the special motion to strike. She argued that the cross-complaint is not a SLAPP, because the allegations do not arise from Guerra's protected activity of filing a lawsuit but from unprotected conduct preceding that lawsuit—namely his refusal in January 2017 to honor the longstanding incentive agreement between BPH and Jack Previte. Previte further argued that even if Guerra could establish that protected activity formed the gravamen of the cross-complaint, the cross-complaint had at least the "minimal merit" required to prevail against the anti-SLAPP motion.
Previte submitted a declaration in which she described the information provided by her husband before his death, listing the distributions they would receive from the Barbaccia family and companies as well as the properties that generated income owed to them. The file included the notarized original incentive agreement. Previte attested to many of the facts alleged in her cross-complaint and described how Cyril reassured her in various ways, after Jack's death, that he and Lena would honor their promises to her husband. But after Cyril passed away and the Barbaccias' interest in the Palm Valley Apartments sold, Guerra left her a voicemail saying that "he wanted to come to an agreement on the sale of Palm Valley," which concerned her because there was already a written contract in place.
We note that Previte's declaration on this point differs from her cross-complaint, which states that Guerra left Previte a voicemail "promising that everything would be made right with regard to the Palm Valley sale."
D. The Trial Court's Order
The trial court issued a written order denying Guerra's anti-SLAPP motion. The trial court reasoned that while the special motion to strike identified allegations of the cross-complaint concerning litigation-related activity, Guerra failed to connect the claims asserted against him to that protected activity. The trial court rejected what it deemed a conclusory effort to characterize the allegations of the cross-complaint as protected litigation and pre-litigation activities, when in fact, Previte's claims of breach of contract and tortious interference did not arise from plaintiffs' filing of the complaint. The trial court concluded that Guerra did not meet his initial burden of demonstrating that the cross-complaint claims arose from protected activity and, accordingly, the burden did not shift to Previte to demonstrate the merits of her claims.
II. DISCUSSION
Guerra contends that the trial court erred in determining that he failed to meet his threshold burden. He argues that the trial court's analysis raises an important question about the evidentiary standard that courts should apply in evaluating the moving party's prima facie showing in the first step of an anti-SLAPP motion. Guerra posits that the threshold "prima facie" showing is met by a showing that it is plausible, based on the pleadings, evidence, or both, that the claims alleged in the challenged pleading are based on protected activity. He argues that the trial court imposed too onerous a burden by requiring him to "establish" that the claims subject to the special motion to strike were founded on protected activity.
Previte does not dispute that the moving party must make a prima facie showing but contends that the trial court correctly evaluated the cross-complaint allegations, none of which are based on Guerra's protected rights to petition, speak, or litigate.
We conclude that the trial court held Guerra to the correct legal standard in deciding whether he met his initial burden under the anti-SLAPP statute.
A. The Anti-SLAPP Statute and Standard of Review
The statute commonly known as the anti-SLAPP statute (§ 425.16) "allows defendants to request early judicial screening of legal claims targeting free speech or petitioning activities." (Wilson v. Cable News Network, Inc. (2019) 7 Cal.5th 871, 880-881 (Wilson).) It provides a "procedural remedy to dispose of lawsuits that are brought to chill the valid exercise of constitutional rights." (Rusheen v. Cohen (2006) 37 Cal.4th 1048, 1055-1056 (Rusheen).) That remedy "authorizes a special motion to strike a claim '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.' (§ 425.16, subd. (b)(1).)" (Wilson, supra, at p. 884.) By its own terms, the anti-SLAPP statute is to "be construed broadly" in furtherance of its stated goals. (§ 425.16, subd. (a); Barry v. State Bar of California (2017) 2 Cal.5th 318, 321.)
Courts evaluate an anti-SLAPP motion in two steps. (Wilson, supra, 7 Cal.5th at p. 884.) At the first step, the court examines whether the moving defendant "has made a threshold showing that the challenged cause of action is one arising from protected activity." (Navellier v. Sletten (2002) 29 Cal.4th 82, 88 (Navellier).) "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.' [Citation.] Courts then must evaluate whether the defendant has shown any of these actions fall within one or more of the four categories of ' "act[s]" ' protected by the anti-SLAPP statute." (Wilson, supra, at p. 884, citing § 425.16, subd. (e).)
In Baral v. Schnitt (2016) 1 Cal.5th 376, 382 (Baral), the California Supreme Court clarified that a claim rather than a cause of action is "the proper subject of a special motion to strike" and helps to avoid confusion as to the so-called "mixed cause of action" that combines allegations of protected activity under the statute with allegations of unprotected activity. We employ the suggested language here but do not alter or replace older case references to a "cause of action" challenged by special motion to strike.
A defendant meets this burden by demonstrating that he or she has engaged in (1) "protected activity" under the anti-SLAPP statute, and (2) the plaintiff's allegations "arise from" that protected activity. (Laker v. Board of Trustees of California State University (2019) 32 Cal.App.5th 745, 760 (Laker).) "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 (Park); see also City of Cotati v. Cashman (2002) 29 Cal.4th 69, 78 (City of Cotati).) 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." (Park, supra, at p. 1060.) Courts must consequently distinguish "between activities that form the basis for a claim and those that merely lead to the liability-creating activity or provide evidentiary support for the claim." (Id. at p. 1064.)
If the defendant makes this threshold showing, the burden shifts at the second step to the plaintiff to demonstrate the merit of the challenged cause of action by establishing a probability of success. (§ 425.16, subd. (b)(1); Wilson, supra, 7 Cal.5th at p. 884.) "Only a cause of action that satisfies both prongs of the anti-SLAPP statute—i.e., that arises from protected speech or petitioning and lacks even minimal merit—is a SLAPP, subject to being stricken under the statute." (Navellier, supra, 29 Cal.4th at p. 89.)
"We review de novo the grant or denial of an anti-SLAPP motion." (Park, supra, 2 Cal.5th at p. 1067.) "We exercise independent judgment in determining whether, based on our own review of the record, the challenged claims arise from protected activity." (Ibid.)
B. Application of the Anti-SLAPP Statute to Previte's Claims
The trial court concluded that Guerra did not meet his initial burden to demonstrate that Previte's cross-complaint claims arise from acts "in furtherance of [Guerra's] right of petition or free speech." (§ 425.16, subd. (b)(1).) Guerra contends that the trial court overlooked the demonstrated connection between the claims in the cross-complaint and Guerra's decision to file the complaint and imposed a more burdensome standard, requiring Guerra to establish that fact rather than simply make a "prima facie" showing. He asserts that Previte's causes of action, and claims of injury, are expressly based on his litigation activity.
Guerra urges this court to clarify the standard for evaluating the moving party's prima facie burden on a special motion to strike. We find, however, that decisions of the California Supreme Court and other published cases already provide appropriate guidance. We address his contentions about the moving party's burden concurrent with our de novo review of the trial court's ruling.
1. The "Arising From" Standard Requires a "Threshold" or "Prima Facie" Showing at the First Step of an Anti-SLAPP Motion
Courts describe the "arising from" standard at the first step of a special motion to strike as requiring a threshold or "prima facie" showing by the moving defendant. (See D.C. v. R.R. (2010) 182 Cal.App.4th 1190, 1217 [comparing historical use of terms "prima facie" and "threshold" to describe the defendant's first-step showing].) This articulation of the standard is consistent with California Supreme Court precedent expressing the moving defendant's initial burden. (See, e.g., City of Montebello v. Vasquez (2016) 1 Cal.5th 409, 420; Club Members for an Honest Election v. Sierra Club (2008) 45 Cal.4th 309, 315-316.)
In Optional Capital, Inc. v. Akin Gump Strauss, Hauer & Feld LLP (2017) 18 Cal.App.5th 95, 112 (Optional Capital), the court explained that the first-step showing was "not an onerous one" in that a "defendant need only make a prima facie showing that the . . . claims arise from . . . constitutionally protected free speech or petition rights."
In Laker, a panel of this court addressed the moving defendants' burden in two parts, noting that they first had to "make a prima facie showing that their conduct falls within one of the categories set out in section 425.16, subdivision (e)" (Laker, supra, 32 Cal.App.5th at p. 763) and also had to "make a prima face showing that [the plaintiff]'s cause of action arises from that protected conduct" (ibid.). Put differently, the moving defendant " 'need not prove that the challenged conduct is protected by the First Amendment as a matter of law; only a prima facie showing is required.' " (People ex rel. Fire Ins. Exchange v. Anapol (2012) 211 Cal.App.4th 809, 822 (Anapol).)
Most recently, the California Supreme Court in Wilson reaffirmed and clarified the application of the prima facie standard at the first step of the anti-SLAPP analysis. Wilson involved an anti-SLAPP challenge to employment discrimination and retaliation claims. (Wilson, supra, 7 Cal.5th at p. 880.) The court considered whether allegedly illegal (discriminatory or retaliatory) conduct by the defendant employer "can ever be said to be based on an 'act . . . in furtherance' of speech and petitioning rights under section 425.16, subdivisions (b)(1) and (e)(4)." (Id. at p. 885.) It held that a plaintiff's allegations of improper motive "cannot be dispositive of the question." (Id. at p. 889.) Rather, at the first step of the anti-SLAPP analysis, the court "examine[s] the conduct of defendants without relying on whatever improper motive the plaintiff alleged." (Id. at p. 888.) It evaluates "only whether a defendant has made out a prima facie case that activity underlying a plaintiff's claims is statutorily protected [citations], not whether it has shown its acts are ultimately lawful." (Ibid.) If the defendant makes this threshold showing, then " 'any "claimed illegitimacy of the defendant's acts is an issue which the plaintiff must raise and support in the context of the discharge of the plaintiff's [secondary] burden to provide a prima facie showing of the merits of the plaintiffs case." ' " (Ibid., quoting Navellier, supra, 29 Cal.4th at p. 94.)
Wilson thus rejected the notion that the plaintiff's or cross-complainant's allegations may be singularly dispositive—without considering the defendant's evidence—of whether an act qualifies as protected activity under the anti-SLAPP statute. (Wilson, supra, 7 Cal.5th at pp. 888-889.) The court clarified that "[n]othing in the statutory scheme prevents the defendant from introducing evidence establishing" a protected basis for the allegedly injurious conduct. (Id. at p. 889.) It concluded, in the context of employment litigation, "that for anti-SLAPP purposes discrimination and retaliation claims arise from the adverse actions allegedly taken, notwithstanding the plaintiff's allegation that the actions were taken for an improper purpose. If conduct that supplies a necessary element of a claim is protected, the defendant's burden at the first step of the anti-SLAPP analysis has been carried, regardless of any alleged motivations that supply other elements of the claim." (Id. at p. 892.)
Guerra asserts that the pleadings and evidence submitted in support of the special motion to strike Previte's cross-complaint meet and exceed the moving defendant's threshold burden as articulated in Wilson. He submits that the claims against him are based on his "refusal" to satisfy Previte's demand under the incentive agreement and his "accusations of fraud and theft" against her and her late husband. Guerra argues that the record before the trial court made out a prima facie case that his alleged refusal and accusations occurred entirely within the context of the complaint or in response to her formal demand—conduct he claims falls under petitioning activity protected by the anti-SLAPP statute. Guerra contends, however, that rather than credit his showing at the first step of the anti-SLAPP analysis (Wilson, supra, 7 Cal.5th at p. 888), the trial court misapprehended the level of proof required and erroneously concluded that he failed to "carry his initial burden of demonstrating the claims asserted arise from protected activity." Guerra argues that a prima facie showing requires only " 'slight evidence which creates a reasonable inference of fact sought to be established but need not eliminate all contrary inferences.' " (Krinsky v. Doe 6 (2008) 159 Cal.App.4th 1154, 1172, fn. 14.) Previte counters that the existence of protected activity like the filing of the complaint fails to satisfy Guerra's burden because the claims asserted in the cross-complaint arise elsewhere, in Guerra's acts independent from his later exercise of the right of petition.
The Wilson decision postdated the trial court proceedings and the filing of opening and responsive briefs in this case. Guerra first referenced Wilson in his reply brief.
To determine whether Guerra carried his prima facie burden at the first step of the anti-SLAPP analysis, we turn to the allegations of the cross-complaint and the declarations submitted in support of Guerra's special motion to strike. (§ 425.16, subd. (b)(2).) We examine the cross-complaint allegations in some detail to determine whether the conduct that Guerra contends is subject to section 425.16 is the conduct from which Previte's legal claims arise. In doing so, we do not focus on the "form of the plaintiff's cause of action but, rather, the defendant's activity that gives rise to his or her asserted liability—and whether that activity constitutes protected speech or petitioning." (Navellier, supra, 29 Cal.4th at p. 92.)
We echo Wilson's clarification that at the first step of the anti-SLAPP analysis, it is not the plaintiff's assertions about the defendant's motivations or conduct that controls. (Wilson, supra, 7 Cal.5th at pp. 888-889.) Also, where a pleaded cause of action includes allegations of both protected and unprotected activity, the allegations that arise from unprotected activity are "disregarded." (Baral, supra, 1 Cal.5th at p. 396; see Laker, supra, 32 Cal.App.5th at p. 772.) At the same time, allegations of protected activity that "are 'merely incidental' or 'collateral' are not subject to section 425.16." (Baral, supra, at p. 394.) To the extent that Previte's cross-complaint contains allegations of protected conduct "that merely provide context, without supporting a claim for recovery, [those allegations] cannot be stricken under the anti-SLAPP statute." (Ibid.)
We agree with Guerra that Previte's reference to the standard of review misstates this point. Citing Park, Previte states in her respondent's brief that "[a]ppellate courts accept the plaintiff's factual assertions as true for purpose of resolving whether the trial court erred in denying an [a]nti-SLAPP motion." What Park says, however, is that in resolving an anti-SLAPP motion, the court does not weigh the evidence but accepts the plaintiff's "submissions" as true and considers only whether any contrary evidence from the defendant establishes its entitlement to prevail as a matter of law. (Park, supra, 2 Cal.5th at p. 1067.) This statement in Park is best understood in reference to the plaintiff's evidentiary submissions at the second step of the analysis, as the Wilson decision clarifies. In Wilson, the court clarified that while a court at the second step "must . . . ' "accept as true the evidence favorable to the plaintiff," ' . . . we have never insisted that the complaint's allegations be given similar credence in the face of contrary evidence at the first step." (Wilson, supra, 7 Cal.5th at p. 887, citation omitted.)
2. No Claims Arising From Protected Litigation Activity
The cross-complaint pleads six causes of action related to breach of the incentive agreement and intentional interference with contractual and economic relations and inheritance. The main thrust of the cross-complaint is set forth in paragraphs 10 and 11. Previte alleges in those paragraphs that Guerra, acting with malicious intent, has refused to pay Previte the funds owed as a result of the sale of Palm Valley, has claimed that the incentive agreement between BPH and Jack Previte is invalid and unenforceable, and has prevented BPH from fulfilling its obligations to Previte. Previte also alleges that Guerra has interfered with Previte's expected inheritance and has "unduly influenced Lena Barbaccia" for Guerra's own benefit and to Previte's detriment.
Guerra identifies three categories of conduct alleged which, independently or in combination, supply the key elements of the pleaded causes of action. First, Guerra's refusal to allow BPH to pay Previte the funds she claims were due from the sale of Palm Valley forms the basis of the first, third, fourth, and fifth causes of action for breach of contract, inducing breach of contract, interference with economic advantage, and interference with contract. Second, Guerra's refusal to acknowledge the validity of the incentive agreement expressly or implicitly forms the basis of the first and second causes of action for breach of contract and declaratory relief. Third, Guerra's exercise of "undue influence" over Lena Barbaccia, isolating her from trusted advisors while accusing Jack and Valerie Previte of fraud and theft, forms the basis of the third, fourth, fifth, and sixth causes of action for inducing breach of contract, interference with economic advantage, interference with contract, and interference with expected inheritance.
As we explain, we find that Guerra's refusal to recognize the incentive agreement as valid and enforceable is linked to his refusal to allow BPH to fulfill the terms and pay Previte. We consider the "acts of refusal" together, as conduct underlying the cross-complaint, and separately consider the "acts of influence" as another type of underlying conduct. For each category of conduct, we must decide whether Guerra has made "a prima facie showing that [his] conduct falls within one of the categories set out in section 425.16, subdivision (e)." (Laker, supra, 32 Cal.App.5th at p. 763.) Following Baral, we decline to adopt Guerra's framework based on pleaded causes of action and instead focus on identifying the "allegations of protected activity, and the claims for relief supported by them." (Baral, supra, 1 Cal.5th at p. 396.)
a. Guerra's Refusal to Honor the Incentive Agreement and Pay Previte Does Not Fall Within the Scope of Protected Petitioning Activity
Previte alleges in the cross-complaint that under the incentive agreement, payment was owed " 'upon the sale of' " the Palm Valley Apartments, but despite that "BPH has refused to pay . . . any amount." She alleges that Guerra "failed to inform" her of the Palm Valley sale in January 2017 "to avoid BPH's obligation to pay her under the" incentive agreement. She alleges that after she contacted the title company and counsel for BPH inquiring after her payment, Guerra reassured her that "everything was fine." But after "numerous demands" for payment went unanswered, Previte had "no option but to take legal action." Previte alleges that she filed the arbitration in August 2017, and Guerra responded "by suing" her, "baselessly accusing her and her deceased husband of fraud and theft," and "disregarding the express terms of the deal between Jack Previte and Cyril Barbaccia."
Previte seeks to recover "for breach of contract arising from BPH's refusal to pay Valerie Previte her six percent share of BPH's sale of its portion of the Palm Valley Apartments." The pleaded causes of action for inducing breach of contract, intentional interference with contract, and intentional interference with economic advantage, each expressly allege that Guerra knew of the incentive agreement and, as sole member of BPH and as co-trustee of the Barbaccia trust, "has prevented BPH from performing under the Agreement by refusing to allow BPH to pay" Previte. The claim for declaratory relief also centers on the incentive agreement, alleging that the contracting parties knowingly and consensually entered into the agreement, and that despite Guerra's knowledge of it, BPH has claimed—through Guerra—that the agreement is unenforceable.
The common denominator of these allegations is nonperformance under the incentive agreement. Previte claims that Guerra's refusal to recognize the validity of the agreement or to honor its terms has prevented BPH from performing, has caused a breach of the agreement between BPH and Previte, and has deprived Previte of the expected benefits of the agreement and the economic relationship it creates.
Guerra contends, however, that there is neither evidence nor allegation of any "refusal" to pay Previte or challenge to the validity of the incentive agreement before the filing of the complaint in this action. Rather, Guerra asserts that in response to Previte's initial request for payment, he told her that he would "look into" it. He sent an e-mail to Previte a few weeks later, saying that "[t]o make sure things are handled in an orderly manner, . . . [BPH] has retained counsel to represent it in connection with . . . any claims to the proceeds of the sale of any of the LLC's assets." The e-mail asked Previte to direct all future inquires to his and BPH's counsel. Less than two weeks later, Previte's counsel sent the demand letter. The demand asserted that the sale of BPH's ownership interest in the Palm Valley Apartments "triggered payment of a vested 6% Incentive Participation Interest" to Previte, which amount "should have been paid at the close of escrow" on January 3, 2017. All further communications apparently were between counsel.
Counsel for Guerra and BPH "immediately responded" to the demand in writing, saying they would investigate the claim and asking for documentation. Several months later, Previte's counsel filed an arbitration in JAMS. Counsel for BPH challenged jurisdiction in JAMS based on their position that the incentive agreement, including the arbitration clause, was not the result of valid consent. Shortly after, counsel filed the complaint in this action on behalf of Guerra, BPH, and CGB.
Guerra asserts that based on this evidence, the only "refusal to pay" occurred upon the filing of the complaint against Previte and in the form of the complaint allegations. A "refusal," however, is simply the "denial or rejection of something offered or demanded." (Black's Law Dict. (11th ed. 2019).) Both the pleadings and the record demonstrate that the refusal forming the basis of Previte's action was not expressed—at the time—in any oral or written statement; it was shown by Guerra's unexplained (according to the allegations of the cross-complaint) failure to honor the incentive agreement. In paragraphs six and 14, the cross-complaint states, "Jack Previte's compensation agreement was honored throughout Cyril Barbaccia's life, and through the end of December 2016," but when BPH's share of Palm Valley sold in January 2017, Guerra "refused, without explanation, to pay Valerie Previte under the" incentive agreement. Failing to pay Previte, or refusing to allow BPH to pay, is therefore the action, or inaction, by Guerra that supplies those elements and "consequently form[s] the basis for liability." (Park, supra, 2 Cal.5th at p. 1063.)
Guerra does not contend that a failure to perform under the contract at the time the duty arose is protected activity. Nor should he. The anti-SLAPP statute defines an act "in furtherance of a person's right of petition or free speech" (§ 425.16, subd. (b)(1)) to include, as relevant to the conduct alleged in this case, "any written or oral statement or writing made before a legislative, executive, or judicial proceeding, or any other official proceeding authorized by law" (id., subd. (e)(1)) and "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" (id., subd. (e)(2)). Neither party suggests that there was any judicial or other official proceeding underway at the time BPH sold its ownership in Palm Valley Apartments, or that the act of not paying Previte at that time, or of refusing to authorize BPH to pay Previte at that time, constitutes a protected statement under section 425.16, subdivision (e).
We do not list the third and fourth clauses of section 425.16, subdivision (e), concerning statements or conduct made in connection with an "issue of public interest" or a "public issue," since those definitions are not at issue in this case. We note that if the challenged claim arises from a statement described in clause (1) or (2) of section 425.16, subdivision (e), the defendant is not required to separately demonstrate that the statement was made in connection with a "public issue." (Briggs v. Eden Council for Hope & Opportunity (1999) 19 Cal.4th 1106, 1113 (Briggs).)
Guerra nevertheless maintains that even if the court were to construe conduct before the filing of the complaint as an implied "refusal" to pay, such conduct falls within the scope of the anti-SLAPP statute because it occurred in connection with Previte's demand for payment and the investigation that followed. Guerra relies on Briggs, supra, 19 Cal.4th at page 1120 for the general proposition that section 425.16 "was intended broadly to protect, inter alia, direct petitioning of the government and petition-related statements and writings—that is, 'any written or oral statement or writing made before a legislative, executive, or judicial proceeding' (§ 425.16, subd. (e)(1)) or 'in connection with an issue under consideration or review' (id., subd. (e)(2)) by such." He points out that the constitutional right to petition not only includes " ' "the basic act of filing litigation . . . ." ' " (Briggs, supra, at p. 1115), it also includes communications " 'preparatory to or in anticipation of bringing . . . an action . . . .' " (ibid.).
Guerra submits that just as a demand made in contemplation of litigation may qualify as a statement "made in connection with an issue under consideration or review by a . . . judicial body" (§ 425.16, subd. (e)(2); see, e.g., Malin v. Singer (2013) 217 Cal.App.4th 1283, 1293), acts and communications in response to that demand or connected to an issue raised by the demand must also be protected. He contends that there is no evidence to support the notion that Previte was injured by anything done by Guerra prior to Previte's demand for payment. He maintains that any subsequent communications about the investigation into her demand, including with Lena on that subject, through authorizing the complaint against Previte, constitute statements made before a judicial proceeding (§ 425.16, subd. (e)(1)), or statements "made in connection with an issue under consideration or review" by a judicial body, or in any other official proceeding (id., subd. (e)(2)). He contends that these acts constitute protected conduct in connection with or in preparation for litigation. (Briggs, supra, 19 Cal.4th at p. 1115.)
It is well established that the constitutional right of petition includes the act of filing a lawsuit, and statements made in connection with or in preparation of litigation are subject to section 425.16. (Briggs, supra, 19 Cal.4th at p. 1115; see Kashian v. Harriman (2002) 98 Cal.App.4th 892, 908 (Kashian).) Briggs is illustrative. The lawsuit in that case involved an action by residential landlords against a nonprofit that counseled tenants in housing disputes. (Briggs, supra, at pp. 1109-1110.) The plaintiffs based their defamation claim on the defendant's conduct in helping a tenant take legal action and in making statements to a housing department investigator. (Id. at p. 1114.) They based their emotional distress claim in part on the defendant's "alleged provision of false information and direction" to "tenants involved in a dispute over a security deposit." (Id. at p. 1115.) The court affirmed that all of the plaintiffs' causes of action arose from the defendant's "statements or writings made in connection with issues under consideration or review by official bodies or proceedings—specifically, [department of housing] or the civil courts." (Ibid.) It noted that even the defendant's counseling of one of the tenants was, "apparently . . . in anticipation of litigation, and courts considering the question have concluded that '[j]ust as communications preparatory to or in anticipation of the bringing of an action or other official proceeding are within the protection of the litigation privilege of Civil Code section 47, subdivision (b) [citation], . . . such statements are equally entitled to the benefits of section 425.16.' " (Ibid.)
Thus, in Briggs, the court emphasized that the anti-SLAPP statute " 'does not limit its application to certain types of petition activity.' " (Briggs, supra, 19 Cal.4th at p. 1117.) Consistent with this conclusion and the legislative mandate to construe section 425.16 broadly, courts have "adopted a fairly expansive view of what constitutes litigation-related activities within the scope of section 425.16." (Kashian, supra, 98 Cal.App.4th at p. 908.) A prelitigation statement that "concerns the subject of the dispute and is made in anticipation of litigation contemplated in good faith and under serious consideration" is one type of prelitigation conduct that is subject to anti-SLAPP protection. (Anapol, supra, 211 Cal.App.4th at p. 824; accord Neville v. Chudacoff (2008) 160 Cal.App.4th 1255, 1268 (Neville).) A demand letter sent in good faith contemplation of litigation typically constitutes a protected prelitigation statement. (Malin v. Singer, supra, 217 Cal.App.4th at p. 1293; see Anapol, supra, at p. 825 ["[W]hen an attorney seriously and in good faith contemplates litigation, and sends the opposing party a demand letter, the demand letter has been held to constitute a protected prelitigation statement"].)
It follows from these precedents that Guerra's filing of the complaint alleging misconduct by the Prevites and challenging the validity of the incentive agreement constitutes protected petitioning activity under section 425.16, subdivision (e)(1). It is less clear to what extent Guerra's actions in response to the demand letter fall within the scope of protected, prelitigation activity under section 425.16, subdivision (e)(2). The demand letter sent by Previte's counsel in early February 2017 pressed for immediate fulfillment of the payment promised in the incentive agreement, which it asserted was overdue as of January 3, 2017. Though the demand did not expressly reference litigation, we agree in concept with Guerra that oral or written communications with BPH's counsel, or with Lena as an interested party, that concerned the investigation following Previte's demand would fall within the realm of protected prelitigation statements made in good faith anticipation of litigation. (Neville, supra, 160 Cal.App.4th at p. 1266; see § 425.16, subd. (e)(2).)
But Guerra has not shown that such protected prelitigation activity is the conduct underlying the cross-complaint. The critical inquiry, as explained above, is whether the challenged claims are based on an act in furtherance of Guerra's right of petition. (City of Cotati, supra, 29 Cal.4th at p. 78.) 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." (Park, supra, 2 Cal.5th at p. 1060.) Courts must consequently distinguish "between activities that form the basis for a claim and those that merely lead to the liability-creating activity or provide evidentiary support for the claim." (Id. at p. 1064.)
Contrary to his arguments on appeal, Guerra's inability to satisfy his threshold burden is not due to the trial court's misapprehension of his prima facie burden as the moving defendant. Guerra's petitioning activity within the meaning of section 425.16 is simply not "the wrong complained of" (Park, supra, 2 Cal.5th at p. 1060) upon which Previte's claims are based. Previte alleges that Guerra is liable for "BPH's refusal to pay Valerie Previte her six percent share of BPH's sale of its portion of the Palm Valley Apartments" and for Guerra's refusal, "through his role as co-trustee of the Barbaccia trust" and "[a]s co-trustee of the sole member of BPH," "to allow BPH to make any payment" to Previte despite his knowledge of the incentive agreement. The cross-complaint repeatedly claims that Guerra, in his co-trustee role, prevented BPH from paying Previte under the incentive agreement. It plainly states that payment under the incentive agreement was "owed . . . 'upon the sale of' Palm Valley," implying that any breach for nonpayment or interference with payment originated at that time. The fact that Guerra later exercised his constitutional right of petition to authorize the lawsuit or communicate with interested persons about the lawsuit does not transform the underlying, injury-producing refusal (or implied refusal) to honor the agreement into a protected act. The court may strike a cause of action "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." (Park, supra, at p. 1060.)
Guerra tries to show that his petitioning activity formed the basis for Previte's claims in two ways. First, he contends that the cross-complaint alleges no basis for Guerra's liability until he "orchestrated" the "sham" complaint against Previte. Second, he contends that the cross-complaint specifically references litigation activity as the acts that caused Previte's injuries. We address these contentions in reverse order.
It is true that the cross-complaint references certain litigation-related conduct by Guerra. The cross-complaint states, for example, that "[w]hen Valerie Previte filed an arbitration claim . . . against BPH, John Guerra orchestrated a sham lawsuit alleging wrongdoing by the Prevites" and claiming for the "first time" that the incentive agreement was unenforceable. Guerra maintains that the "refusals to pay" alleged in the cross-complaint are references to the complaint allegations notifying Previte that the incentive agreement was invalid. He contends that if any "refusal" occurred outside of the complaint, it "must" have been either " 'oral or written' " within the meaning of section 425.16, subdivision (e)(2), in connection with Previte's demand for payment, and even if the "refusal" was implied—as we conclude—it would qualify as "communicative conduct" (Rusheen, supra, 37 Cal.4th at p. 1056) within the scope of the statute.
Guerra's effort to reframe the underlying "refusal to pay" as "communicative conduct" (Rusheen, supra, 37 Cal.4th at p. 1056) within the scope of the anti-SLAPP statute is not supported by the statutory language or case authority. Rusheen addressed the reach of the litigation privilege regarding noncommunicative actions which are necessarily related to a privileged, communicative act. (Rusheen, supra, at p. 1052.) The court's recognition that "any act" in furtherance of a person's rights of petition or free speech (§ 426.16, subd. (b)(1)) "includes communicative conduct such as the filing, funding, and prosecution of a civil action" (Rusheen, supra, at p. 1056) did not provide blanket coverage for "communicative conduct," nor could it expand the statutory categories of protected activity beyond those in section 425.16, subdivision (e). Instead, the court held that where the conduct triggering the anti-SLAPP motion "is communicative, the litigation privilege extends to noncommunicative acts that are necessarily related to the communicative conduct, which in [Rusheen] included acts necessary to enforce the [default] judgment and carry out the directive of the writ [of execution]." (Rusheen, supra, at p. 1065.)
It is therefore not enough that the cross-complaint references protected conduct under section 425.16, subdivision (e), such as the allegation that Guerra "orchestrated" the "sham" complaint. As discussed ante, Guerra must also demonstrate that the protected activity "supplies one or more elements of" Previte's claims. (Wilson, supra, 7 Cal.5th at p. 887.) By focusing selectively on allegations that describe protected activity, Guerra fails to acknowledge that the "refusal" that precipitated Previte's claims preceded the onset of litigation and occurred independently even of the February demand letter.
Turning to the notion that the cross-complaint alleges no basis for Guerra's liability aside from his conduct in orchestrating the complaint, he proposes that this court apply what he calls the "but for" test endorsed in Navellier, supra, 29 Cal.4th 82. In Navellier, the California Supreme Court considered whether causes of action for fraud and breach of contract arose from the defendant's exercise of his right of petition in a separate action in federal court. The complaint in the state court action alleged that the defendant committed fraud by misrepresenting his intent to be bound by a release negotiated in the federal action and committed breach of contract by filing counterclaims in that action. (Id. at p. 87.) Having examined the pleadings and declarations, the court concluded that the defendant "is being sued because of the affirmative counterclaims he filed in federal court. In fact, but for the federal lawsuit and [the defendant]'s alleged actions taken in connection with that litigation, [the] . . . present claims would have no basis." (Id. at p. 90, italics added.)
We believe the reasoning in Navellier confirms the distinction we draw here. Protected conduct that follows or expresses the unprotected conduct, or is incidental to it, is not conduct giving rise to the challenged claim. As the court reiterated in Navellier, "the mere fact that an action was filed after protected activity took place does not mean the action arose from that activity for the purposes of the anti-SLAPP statute. [Citation.] Moreover, that a cause of action arguably may have been 'triggered' by protected activity does not entail it is one arising from such." (Navellier, supra, 29 Cal.4th at p. 89.) Applying the "but for" test in our case does not produce the result that Guerra seeks, because Previte's claims are independent from Guerra's litigation-related activities. Unlike in Navellier, where the complaint alleged wrongdoing based on the defendant's conduct in negotiating a release and in filing counterclaims in the parallel federal litigation (id. at p. 90), Previte's claims would persist even if the references to protected action in the cross-complaint were eliminated.
Optional Capital, supra, 18 Cal.App.5th 95, exemplifies this point as well. Following a complex mire of legal proceedings, the complaint in Optional Capital alleged that the defendant corporation and its legal counsel had conspired to fraudulently transfer funds to delay or prevent the plaintiff's recovery related to other actions. Lawyers for the corporate defendant each filed an anti-SLAPP motion. (Id. at pp. 105-106.) The court concluded that the conduct underlying the complaint allegations was protected because it "arose directly out of the litigation in which [defendant's lawyers] were respectively representing [the defendant corporation]" (id. at p. 114) and, under the plaintiff's theory of the case, there would not have been any wrongful transfer of funds "but for [the lawyer]'s work in negotiating a settlement of the state court action and but for [the other lawyer]'s alleged failure to timely disclose the settlement to the federal district court" (ibid.). The court reaffirmed that " 'conduct is not automatically protected merely because it is related to pending litigation; the conduct must arise from the litigation.' " (Ibid.)
Here, in contrast to Optional Capital, supra, 18 Cal.App.5th at page 114, the challenged claims do not arise from Guerra's protected conduct in litigation or even from communicative conduct in response to Previte's demand. Yet Guerra contends that even if the refusal to pay was not communicated, the act of refusing to pay remains protected by the right to petition because a defendant has the right to deny liability and mount a defense. Guerra cites a series of cases that affirm the right of a defendant to deny liability and defend against litigation. (See, e.g., California Physicians' Service v. Superior Court (1992) 9 Cal.App.4th 1321, 1330 [holding that "[d]efensive pleading . . . is communication protected by the absolute litigation privilege"].) He asserts that "a denial of liability is covered by the anti-SLAPP statute as petitioning activity."
Paying reference to the litigation privilege (Civ. Code, § 47, subd. (b)) can be helpful in construing the scope of section 425.16, subdivision (e)(1) and (2) with respect to the first step of the anti-SLAPP inquiry. (See Flatley v. Mauro (2006) 39 Cal.4th 299, 323.) Here, however, the reference is misleading to the extent that it equates BPH's nonpayment on the incentive agreement with Guerra's taking a position in litigation and defending against claims of liability. As the California Supreme Court explained in Flatley, "[t]he purpose of section 425.16 is to protect the valid exercise of constitutional rights of free speech and petition from the abuse of the judicial process (§ 425.16, subd. (a)), by allowing a defendant to bring a motion to strike any action that arises from any activity by the defendant in furtherance of those rights. (§ 425.16, subd. (b)(1).)" (Id. at p. 324.) Since Guerra was not exercising his constitutional right of petition when he refused (by his conduct at the time) to allow BPH to honor the incentive agreement and pay Previte 6 percent of the gross sales price, he cannot meet his prima facie burden of showing the action arose from protected activity within the meaning of section 425.16, subdivision (e).
We are guided in this determination by the California Supreme Court's analysis in Park, supra, 2 Cal.5th 1057, which has several parallels to the scenario presented in this case. The plaintiff in Park filed a discrimination lawsuit after the university that employed him denied his application for tenure. The university filed a special motion to strike. (Id. at p. 1061.) The university argued at the first step of the anti-SLAPP analysis that the decision to deny tenure and the numerous communications leading up to and following that decision were protected activities that gave rise to the plaintiff's suit. (Ibid.) The high court noted that it is not enough "that the claim challenged as a SLAPP was filed because of protected activity, in that perhaps the . . . plaintiff would not have filed suit had the defendant not done so first . . . ." (Id. at p. 1064.) Rather, the protected activity must "supply elements of the challenged claim." (Ibid.) In Park, the elements of the discrimination claim "depend[ed] not on the grievance proceeding, any statements, or any specific evaluations of [the plaintiff] in the tenure process, but only on the denial of tenure itself and whether the motive for that action was impermissible." (Id. at p. 1068.) The court explained that the plaintiff's "complaint is 'based on the act of denying plaintiff tenure based on national origin. Plaintiff could have omitted allegations regarding communicative acts or filing a grievance and still state the same claims.' " (Ibid.)
So too here, neither plaintiffs' complaint allegations challenging the validity and enforceability of the incentive agreement nor Guerra's imputed communications with BPH and Lena Barbaccia about the issues in dispute convert the protected communications into the basis for liability. (Cf. Park, supra, 2 Cal.5th at p. 1068.)
To be clear, Guerra's inability to prevail at the first step is not due to a failure of evidence or to inferences improperly drawn against him. It is simply because the activity qualifying for protection under section 425.16, subdivision (e) does not supply one or more elements of the challenged claims. (Wilson, supra, 7 Cal.5th at p. 888.) We reject the argument that Previte's purported inability to provide a non-litigation basis for the claims against Guerra implicitly supported his prima facie case.
In sum, we recognize that Guerra has engaged in communicative conduct in furtherance of his right of petition under section 425.16, and that the cross-complaint references Guerra's petitioning activity in describing the grievances against him. Because, however, the basis of Previte's claims arising from nonpayment on the incentive agreement is Guerra's independent and underlying refusal to honor that agreement, he has not shown that the challenged claims arise from any protected activity.
b. Guerra's Purported Influence Over the Barbaccias Does Not Fall Within the Scope of Protected Petitioning Activity
Guerra's "undue influence" over Lena Barbaccia and the Barbaccia Trust comprises a variety of acts alleged in the cross-complaint. Previte alleges that Guerra: (1) immediately took control of the business after Jack Previte's death, when Cyril was mourning the loss of his friend and "not involved in the decision making"; (2) "seized control of the decision making regarding the Barbaccia estate" between March 2016 and January 2017 and "consolidated his power" by firing advisors and accountants; (3) isolated Lena by "removing trusted accountants, advisors and attorneys who had worked with the Barbaccias for years to develop a charitable estate plan" and also firing Jack and Valerie Previte's son, John, who had helped Cyril and Jack run the business before Jack's death; (4) required employees to sign letters stating that they will not have any contact with the Prevites or will face termination; (5) used Cyril's death and Lena's "failing" mental ability to "unduly influenc[e] her into changing her family's estate plans" to "revoke, amend, or alter" bequests to the Previte family listed in amendments to the trust and to "control her decisions"; and (6) "unduly influenced" Lena "to revoke" the bequests to the Previte family, "to accuse" Previte and her late husband of fraud and theft, and "to accrue" benefits to himself out of the Barbaccia trust and estate. Previte "seeks to undo the nefarious actions taken by John Guerra . . . with respect to the Barbaccia Trust, and to ensure that she receives what she and her husband expected and were promised from the Barbaccias' estate, and to ensure that Lena and Cyril Barbaccias' intentions are honored, rather than being distributed pursuant to the wishes . . . of John Guerra or others."
The allegations of Guerra's influence over Lena and the Barbaccia trust primarily support Previte's claim for relief for interference with expected inheritance (pleaded as the sixth cause of action). The claim for interference with expected inheritance alleges that the Previte family was promised an inheritance from the Barbaccia trust "independent of Jack Previte's rights under" the incentive agreement and set forth in several amendments to the Barbaccia trust, including an Eighth Amendment on April 6, 2015, which listed properties and assets to be gifted to the Previte trust. It alleges that after Jack passed away and Guerra became co-trustee of the Barbaccia trust, he "unduly influenced . . . Cyril and/or Lena Barbaccia to revoke" the bequests, "to accuse" Previte and her late husband of fraud and theft, and "to accrue benefits for himself" out of the trust and estate.
The allegations also support, in part, Previte's claim for relief for intentional interference with economic advantage (pleaded as the fourth cause of action). That claim alleges that Guerra "engaged in wrongful conduct by unduly influencing and isolating Lena Barbaccia in an attempt to take for himself a portion of her fortune and estate, and to prevent others, including Valerie Previte, from receiving what they were promised and are owed." This portion of the fourth cause of action effectively pleads the same injury—interfering with Previte's anticipated receipt of gifts from the Barbaccia estate—as the cause of action for interference with expected inheritance. The "activity that gives rise to [Guerra's] asserted liability" (Navellier, supra, 29 Cal.4th at p. 92) may be described as Guerra's actions to seize and consolidate control of the Barbaccias' trust and trust assets after Jack's death, to isolate Lena from trusted advisors and accountants, and to influence her and/or Cyril, before he died, to revoke the gifts promised to the Prevites from the Barbaccia estate.
To support his contention that Previte's undue influence claims are based on protected, litigation-related communications for purposes of the special motion to strike, Guerra focuses on the allegation that he "accuse[d] Valerie Previte and her deceased husband of fraud and theft." Guerra asserts that the cross-complaint presents two ways in which the accusations of fraud and theft injured Previte: by influencing Lena (1) to disinherit Previte and (2) to refuse to pay Previte under the incentive agreement. Guerra contends that since the only accusations of "fraud and theft" in the record appear in plaintiffs' complaint, the undue influence claim over Lena arises from protected litigation-related activity. He further contends that even if Guerra communicated accusations of fraud and theft to Lena prior to filing the complaint—which the cross-complaint does not allege—those statements would be covered by the anti-SLAPP statute as statements intended to influence interested persons to file or participate in litigation.
Our review of the pleadings does not cohere with Guerra's interpretation of the undue influence claims. By focusing exclusively on the allegation referring to "fraud and theft," Guerra neglects to address the bulk of the allegations relevant to the undue influence claims. It is improper to ignore allegations of the acts that generated the claim, because in determining whether a claim arises from protected activity, "it is the defendant's acts that matter." (Wilson, supra, 7 Cal.5th at p. 887, italics added.) We "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.) While allegations that arise from unprotected activity are disregarded at this initial stage (see Baral, supra, 1 Cal.5th at p. 396; Laker, supra, 32 Cal.App.5th at p. 772), Guerra must be able to show that the allegations of protected activity are not " 'merely incidental' or 'collateral' " (Baral, supra, at p. 394) to the claim and instead form the basis of the claim. Here, Guerra is unable to meet his burden because the standalone allegation of a "fraud and theft" accusation forms, at most, a minor and ambiguous part of the undue influence claim.
The cross-complaint alleges that "[u]pon information and belief, John Guerra unduly influenced the [sic] Cyril and/or Lena Barbaccia to revoke, amend or alter these bequests to the Previte family, to accuse Valerie Previte and her deceased husband of fraud and theft, and to accrue benefits for himself out of the Barbaccia Trust and estate." Guerra acknowledges that the allegation appears in an "awkwardly-worded sentence" and seems to have two possible meanings. He suggests that although it could mean that Guerra influenced Lena herself to accuse the Prevites of "fraud and theft" (i.e., to file the complaint in this action), the more likely interpretation is that Guerra's accusations of "fraud and theft" against the Prevites inspired Lena to disinherit Previte. Guerra contends that the latter interpretation makes more sense, since Lena filing the complaint against Previte is not an act of disinheritance, and the undue influence claim charges Guerra with causing Lena to revoke the gifts promised to the Prevites.
Even if we accept the interpretation that Guerra advances, we find that his accusations of fraud and theft against the Prevites—as set forth in the complaint in this action—are not the "activity that gives rise to his . . . asserted liability." (Navellier, supra, 29 Cal.4th at p. 92.) As set forth above, the cross-complaint alleges multiple acts giving rise to the undue influence claim "[b]etween March 2016 and January 2017"—well before the onset of litigation and even before the sale of the Palm Valley Apartments. The acts that support the claim consist of Guerra's conduct in allegedly seizing control of decision-making authority for the Barbaccias, isolating Lena by firing longtime advisors and accountants, and capitalizing on Lena's supposed frailty by influencing her into changing the family's estate plans to remove the gifts to the Previte family. In other words, the conduct underlying Previte's undue influence claims is Guerra's alleged control and manipulation of the Barbaccias' business and estate decisions in the wake of Jack Previte's death.
The timing of the Barbaccias' decision to disinherit the Prevites reinforces our conclusion that the acts alleged in the cross-complaint to have influenced that decision were entirely removed from the litigation that eventually ensued. In a declaration submitted in support of Guerra's motion to strike, Lena Barbaccia attests that she and Cyril decided in May 2016 to amend the Barbaccia trust, including the "removal of each of the post-death distributions or 'bequests' identified" in Previte's cross-complaint. This evidence shows that the Barbaccias decided to remove the gifts or bequests previously promised to the Prevites while Cyril was still alive, long before Guerra authorized a complaint charging the Prevites with "fraud and theft."
We presume that this evidence, which was submitted in support of Guerra's special motion to strike, was intended to contest the merits of Previte's action in the event the trial court reached the second step of the anti-SLAPP analysis.
In sum, the ambiguous allegation that Guerra "unduly influenced the [sic] Cyril and/or Lena Barbaccia to . . . accuse Valerie Previte and her deceased husband of fraud and theft" may provide context by referencing the accusations eventually levied against the Prevites following BPH's investigation into the demand for payment, but it does not support a claim for recovery. Because "[a]llegations of protected activity that merely provide context, without supporting a claim for recovery, cannot be stricken under the anti-SLAPP statute" (Baral, supra, 1 Cal.5th at p. 394), we conclude that Guerra failed to satisfy his first-step burden as to the undue influence claim.
C. Conclusion
We conclude that Guerra has failed to make a prima facie showing that any of the claims asserted in Previte's cross-complaint arise from protected acts of petitioning or speech as required under section 425.16, subdivision (b)(1). Having resolved the appeal at the first step of the anti-SLAPP analysis, we need not address the second-step analysis pertaining to the merits of Previte's cross-complaint.
III. DISPOSITION
The trial court's order denying Guerra's special motion to strike is affirmed. Respondent Previte is entitled to costs on appeal.
/s/_________
ELIA, ACTING P.J. WE CONCUR: /s/_________
GROVER, J. /s/_________
DANNER, J.