SWEETWATER UNION SCHOOL DISTRICT v. GILBANE BUILDING COMPANYRespondent’s Answer Brief on the MeritsCal.October 21, 2016No. 8233526 SUPREME COURT IN THE FILED SUPREME COURT OCT 21 2n16 Jorge Navarrete Clerk Of The State Of California Deputy SWEETWATER UNION HIGH SCHOOL DISTRICT, Plaintiff and Respondent Vv. GILBANE BUILDING COMPANY,et al. Defendants and Appellants. ANSWERINGBRIEF ON THE MERITS After a Decision by the Court of Appeal Fourth Appellate District, Division One [D067383] San Diego Superior Court [37-2014-00025070-CU-MC-CTL] Hon. Eddie C. Sturgeon, Judge John S. Moot (SBN 106060) James A. Ardaiz (SBN 60455) Sarah Brite Evans (SBN 210980) BAKER MANOCK & JENSEN, PC Alison K. Adelman (SBN 306629) 5260 North Palm, Suite 421 SCHWARTZ SEMERDJIAN Fresno, CA 93704 CAULEY & MOOT LLP Telephone No.: (559) 432-5400 101 West Broadway,Suite 810 © Facsimile No.: (559) 432-5620 San Diego, CA 92101 jardaiz@bakermanock.com Telephone No.(619) 236-8821 Facsimile No. (619) 236-8827 johnm@sscmlegal.com sarah@sscmlegal.com alisona@sscmlegal.com Attorneys for Plaintiff and Respondent SWEETWATER UNION HIGH SCHOOLDISTRICT No. 8233526 IN THE SUPREME COURT Of The State Of California SWEETWATER UNION HIGH SCHOOL DISTRICT, Plaintiff and Respondent Vv. GILBANE BUILDING COMPANY,etal. Defendants and Appellants. ANSWERINGBRIEF ON THE MERITS After a Decision by the Court of Appeal Fourth Appellate District, Division One [D067383] San Diego Superior Court [37-2014-00025070-CU-MC-CTL] Hon. Eddie C. Sturgeon, Judge John S. Moot (SBN 106060) James A. Ardaiz (SBN 60455) Sarah Brite Evans (SBN 210980) BAKER MANOCK & JENSEN, PC Alison K. Adelman (SBN 306629) 5260 North Palm, Suite 421 SCHWARTZ SEMERDJIAN Fresno, CA 93704 CAULEY & MOOT LLP Telephone No.: (559) 432-5400 101 West Broadway, Suite 810 Facsimile No.: (559) 432-5620 San Diego, CA 92101 jardaiz@bakermanock.com Telephone No. (619) 236-8821 Facsimile No. (619) 236-8827 johnm@sscmlegal.com sarah@sscmlegal.com alisona@sscmlegal.com Attorneys for Plaintiff and Respondent SWEETWATER UNION HIGH SCHOOL DISTRICT TABLE OF CONTENTS T. INTRODUCTIONo.oocccccccseesessssesscseseescsesecsscessecessecesessnsscstansaesees 1 Il. STATEMENTOF THE CASE 00... ccccccescsscsseseesseecsscecsscseestssssssseanes 3 A. Procedural History ........ccccccccsccsesseesssssscsscssessccessseesessecserseserseeerees 3 B. Statement Of Facts... cccccecssccssssssecscssessesesssccsesesseesscssscsessessees 5 i. Gilbane and SGI Sought to become program managers for Proposition O while wining and dining key District officials sevecevaevsaacssesecesesaesaeesecsassnesseseaessseseesssseeseseseeessesessessescscatseneaes 6 ii. After lavish entertainment expenditures, Gilbane and SGI were awardedtheir first District contract, and their expenditures Increased .........eeceseesesesecesseeeesseeseestsstecsees 9 iii. District officials awarded the Gilbane/SGI Joint Venture multiple contracts after months of expensive dinners, theater tickets and an all-expenses paid New Year’s Eve weekendat the Rose Bow] o0....ececceecccesessssssssssesssecseceseeseecnssscststsesesaes 10 iv. District officials reward the Gilbane/SGI Joint Venture with yet anotherlucrative CONtraCt....... cece ecessecsessesescesseseesees 13 C. The Guilty Pleas...ccccccsccsssscsscsessessesseesecesesssesssscsecrssererenees 15 IT. STANDARD OF REVIEWuo.cccecccccesesssssesessceecesseeescersavarsesseees 19 IV. LEGAL ARGUMENT: Because the purpose of the second prongofthe anti-SLAPPstatuteis to determine if the requisite minimal merit to proceed exists, a statement under oath which a witness can testify to without objection should be admissible to determine the probability of prevailing ............cceeee 20 A. Introduction... ccceccccccsecsseccsscssssesesscsessessecssescsescesscavevsssseases 20 B. The Court of Appeal Used Its De Novo Authority To Determine That The Anti-SLAPP Requirements Were Met......00..0000.. 22 C. The Sworn Statements Containing The Factual Basis For Multiple Guilty Pleas Are Admissible As Affidavits............ 22 1. What as an affidavit? ...0..ececceesecsseesseseseeseeeeeeees 23 ii. What and howanaffidavit can be used.................0 24 D. Petitioner Incorrectly Contends That The Statements At issue In The Present Case Are Hearsay And Do Not Meet The Former Testimony Exception..........c.cccsssssscccesesseceesesessseesessesessseceeses 27 i. Petitioner misconstrues the foundational issue with respect to admissible statements in an affidavit ..............00 28 ii. These affidavits were judicially noticeable................ 28 E. Each Person Who Provided The Written Factual Narrative Incorporated Into His or Her Plea Form As The Factual Basis For His/Her Plea Was Competent To Testify To The Matters TROL...eeeecencecsceecssceeeeeesecsseeseseseseeseesesessesssessssseneeesasees 29 F,. The Grand Jury Testimony Is Also The Functional Equivalent Of An Affidavit/Declaration And It Is Not Subject To PreClUSION ......ecseeeceeseesecsseeeeeesesseseseeseeeeesseeeeeesesseeasessseseseees 32 G. The Grand Jury Transcripts Were Not Offered Or Admitted As Former Testimony .........::ccccessessessesscessecssccessescssseeseseesesseseees 34 H. There Has Been A Prima Facie Showing That The Former Superintendent And Former Board Members Who Voted On The Contracts Were Corrupted By A Pervasive Pattern Of Lavish Gift Giving By Defendants, Which Voids The Contracts At Issue Pursuant To The Express Terms And Purpose Of Government Code § 1090... eeeesesesececesensessecsecsessesseesseseeeessesesaseeeeeens 40 VI. CONCLUSIONoececceseeeceeseneserenesesesesesenseesseessesesesasesesneseresaes 44 ii TABLE OF AUTHORITIES Cases Arceo v. Junction City, Kansas (2002) 182 F.Supp.2d 1062.00... cccecscscsscescsscsscsscsscsssssseecccecseeeees 39 Baral v. Schnitt (2016) 1 Cal.Sth 376.0... ccccccscssssecsssessssssesscssesscsscssssesscsescsevacercaesaens 20 Blache v. Blache (1951) 37 Cal.21nd 53] occcccccsssesssecssesesscsscsesssceesavavscsacseeesseeaees 35 Briggs v. Eden Councilfor Hope & Opportunity (1999) 19 Cal.4th 1106...ccccsesccscssscsccssssscssessescerseesees 21, 23 Carson Redevelopment Agency v. Padilla (2006)140 CalApp.4th 1323... .ccccccssecscsssssesscssssesessseseseseecsees 4] City ofMontebello v. Vasquez (2016) 1 Cal.Sth 409.cccccecsesessseeseesesscsscsecscssesesseseees 20, 21, 22 ComputerXpress, Inc. v Jackson (2001) 93 Cal.App.4th 993 oo. ccccssssesscssessscsssscsssscscsssereceesseneees 27 Connerly v. State Personnel Bd. (2006) 37 Cal.4th 1169.0... ccccesssssssscsscssesessessesessstevscsesaceeesecaees 19 Davey v. Southern Pacific Co. (1897) 116 Cal. 325eecceccesssecsssesssecsessesecsecsussesscssscsvsesaseccaceaees 19 Equilon Enterprises v. Consumer Cause, Inc. (2002) 29 Cal4th 53... .cccccccsessesseesesessssessccsesscsssscesssssseeseceanenss 2,23 Flatley v. Mauro (2006) 39 Cal.4th 299oooccccccsscsssecsessesscssssscsessesstevseeesaceessesaees 22 Gatton v. A.P. Green Services, Inc. (1998) 64 Cal.App.4th 688.0... ccecscscsscsesssssscerssssereseeaes 35, 36, 38 Hub City Solid Waste Services, Inc. v. City ofCompton (2010) 186 Cal.App.4th L114...ccccccssccsesscscsessseseetsceesenes 42 Jarrow Formulas, Inc. v. LaMarche (2003) 31 Cal.4th 728.0. cccccccccssscsescsesscsessssssscsscscsscsessesseeeees 21, 23 Kibler v. Northern Inyo County Local Hospital Dist. (2006) 39 Cal.4th 192.0. ccccccssessscsesscscssessssscsccscssvsvscterscsecasereeseas 1 Lexin v. Superior Court (2010) 47 Cal.4th 1050...ccccscsccscecssscsscsccsscsseeessetaceeeers 40, 41 ill Navellier v. Sletten (2002) 29 Cal.4th 82.0.0... cccccccscsccseessescscsssscscssstsessevsseceeeseees 1, 21, 23 Paiva v. Nichols (2008) 168 Cal.App.4th 1007.0...cc cccsscsssescssscscecescecssseeseseeseesees 27 People v. Abarca (1991) 233 Cal.App3d 1347 ..cccccccccsscsesssssscscssscssssssceessesessenees 3] People v. Deysher (1943) 2 Cal.2d 141 occcccccssscsessesescsecsccscscscsvasseescsssesscecaeeaesanas 42 People v. Lee (2011) 51 Cal.4th 620... ccccccccsscsescsesscsssssscscsssssscseesscesssseseseees 3] People v. Miles (2008) 43 Cal.4th 1074...eeeeseseeseeeeeseseseesececscsesetassaeseeey 3] San Diegansfor Open Government v. Har Construction (2015) 240 Cal.App.4th 611occeccssscsscssscssseesesscsesssssseseseeees 19 Sosinsky v. Grant (1992) 6 Cal.App.4th 1548ooccccscsccscsssssestsesscsescseseseetereaees 28 Soukup v. Law Office ofHerbert Hafif (2006) 39 Cal.4th 260.0... ccscssessscsssscsscsssectsseeseeees 19, 21, 23, 26 Sweetwater Union High SchoolDist. v. Gilbane Building Co. (2016) 245 Cal.App.4th 19...ccccscsecsesssseetessscseceesssesseespassim Thomson v. Call (1985) 38 Cal.3d 633... ccccscssssssscsessescsescescsssscssststssesesseeees 40, 41, 42 Varian Medical Systems, Inc. v. Delfino (2005) 35 Cal.4th 180... ccccceesscsssscsesscsssesssesseees21, 22, 23, 26 Williams v. Saga Enterprises, Inc. (1990) 225 Cal.App.3d 142... cccececssescseststsseseerseeeees 35, 36, 37 Statutes CIV. Proc. § 425.16... eeccesscesessssesesecsssecscsssscssevacecseesseseesrcaesasacespassim Civ. Proc. § 437oc eecsceescessssesesesesesscsescssscscsscessstsesesnecaseataces 26, 28, 38 Civ. Proc. § 2002...cececccsecsscssessssssscsesssscssesaececsecscseeseaeeaseuesecacs 24, 33 Civ. Proc. § 2003... eeccesscsscsscssescssssscsssscssssceseeceetscsesscaecsesaueas 24, 27, 28 Civ. Proc. § 2004... ceccccescscsssscsessesseacsvesesecusececacsessusstessteacausssseasesecaves 24 1V Civ. Proc. § 2005....cccccscssssesscesssssecssecsssscsesssssssesssssescssesecsssssscesssssssssese 24 Civ. Proc. § 2009... ecsesesssssssssseecesssssscseescscssscsvscssseesssseeseereceees 24, 32 Civ. Proc. § 2015S... eecsesesssssssssscsecesesscsesssssscsssssvscsscsseesessteceeeespassim Ed. Code § 35230... eecscssssessssssscsecesccsssesscscsesscscsssssesscsessssseseseaeeeees 15 Evid. Code § 425 oocccccccccccsssscscsecsssecscssescssssesessscesssesscesessetasseanseseaes 28 Evid. Code § 453 oo. ceccsesssssssssscsscesscsesessssesessscscessessessesevsestesteeerecees 28 Evid. Code § 1200.0... ccecsssssssssssesscesseseseessscsescsssesssscsessesesacscesteeseacans 27 Evid. Code § 1220.0... cccccscsssssssessccsesscsesesscscsscsvscssssesavaccecacaceeseeevars 31 Evid. Code § 1271 oeicccsessssssssescssccsscsesessessscsssssssesscssesesasscssestecetaeaes 34 Evid. Code § 1280.0... ccccssessssssssssccsecseseecscsescssscscsecscscsesscsceseaneraeaes 3] Evid. Code § 1290... cecccccesesscessseseescsessssscssscscsscscssssaceaseres 2, 22, 32 Evid. Code § 1291ecicccccssssssscssecsscsesessvscsesesssssscscssesesasseseaeees 32, 34 Evid. Code § 1292.0... ccceccscssssscsecsecssesssecscsesecstssscsssssacseseseevacseens 34, 37 Gov. Code § 1090eeeeescsssscssecesessesecscsecscscssssssessessscseneees 5, 20, 21 GOV. Code § 87203 ooeeicecccescssssssessscescsecscssesesssssscscssssecasesesacsetecseeenes 16 GOV. Code § 89503 uo. cccssesssssesseseessessescscsssecscsesssesssssssvsesacseeseetatevees 17 Pen. Code § 182 oo.eccccccccssssesssscsssccssecsssscsscscsessvecsesesecaceeseesseataseavaes 17 Other Authorities 1 Witkin, Cal. Evid. (June 2016 update) Hearsay, § 258 woos35 7 Cal.L.Rev.Com. Reports 1 (1965), § 1290 wouleceeesessssssesessees 32 I. INTRODUCTION This caseillustrates an abuse ofthe anti-SLAPP statute (Code of Civil Procedure section 425.16) which was designedto protect parties exercising their First Amendmentrights from being financially terrorized by well-heeled opponents here seeking to quell threateninglitigation under the guise of freedom of speech. In this case, the Sweetwater Union High School District “Sweetwater” and/or “District”) seeks to void certain construction managementcontracts secured by Gilbane Construction (“Gilbane”) byillegal influence peddling. Gilbane seeks to utilize the anti- SLAPPprocedure to dismiss the lawsuit, claiming that its influence peddling was protected First Amendmentactivity because Gilbaneofficials had right to contact public officials to presenttheir position to them, and that, in the absence of legally-admissible evidence ofillegal activity, the anti-SLAPP statute compels dismissal of Sweetwater’s lawsuit. Although Sweetwater presented evidenceto thetrial court that demonstrated Gilbane’s corrupt actions and intentions, Gilbane argues in simple terms that if that evidence is not properly before the court, Sweetwater cannot prevail and demonstrate a probability of prevailing on its claims. Thus, Gilbane seeks to exclude the damning evidence from consideration in order to avail itself of First Amendmentprotections, clearly distorting what was intended by the anti-SLAPPprocess. The anti-SLAPPstatute establishes a procedureforstriking a pleadingthat is brought primarily to “chill” the valid exercise of the constitutional rights of freedom of speech andpetition for redress of grievances. Kibler v. Northern Inyo County Local Hospital Dist. (2006) 39 Cal.4th 192, 197. A lawsuit arising from Constitutionally protected speech or activity is a SLAPPifit “lacks even minimal merit.” Navellier v. Sletten (2002) 29 Cal.4th 82, 89. The statute provides in pertinentpart that in making its determination with respect to the motion, “the court shall consider the pleadings, and supporting and opposing affidavits stating the facts upon whichthe liability or defense is based.” Code Civ.Proc. § 425.16(b)(2). Sweetwater responded to Gilbane’s anti-SLAPP motion by presenting the guilty pleas and sworn factual bases for them by the public officials and Gilbane personnel who admitted their misconduct in documentsfiled in the Superior Court. Additionally, Sweetwater presented sworn grand jury testimony in order to further demonstrate the probability of prevailing on its claims. Atissuein this case is whether the sworn factual bases for the guilty pleas constitute affidavits under the anti-SLAPPstatute and whether sworn testimony of individuals complicit in the pay-to- play scheme qualify as admissible and responsive affidavits under the anti-SLAPP statutory scheme. Petitioners instead have characterized the issue before this Court as “Is testimony given in a criminal case by nonparties to a later civil case subject to Evidence Codesection 1290 et. seq. (Former Testimony) setting conditions for receiving former testimony in evidence?” See Opening Brief on the Merits at p. 1. The Supreme Court granted the petition of Gilbane and Gilbane/SGIa joint venture (the joint venture) from the decision of the Court of Appeal, Fourth Appellate District, Division One, Sweetwater Union High School Dist. v. Gilbane Building Co. (2016) 245 Cal.App.4th 19, (“Sweetwater”), which held that the evidence presentedto thetrial court satisfactorily established that Sweetwater’s case had the requisite merit to proceed forward, despite Gilbane’s First Amendmentclaims, and further held that the evidence presented did constitute affidavits within the meaning of the anti-SLAPPstatute. To establish a probability of prevailing on its claims that the former governmental officials had a prohibited interest in the contracts at issue, Sweetwater offered the guilty pleas and narrative sworn factual bases supporting the guilty pleas of the contractors who gavethelavish gifts to the public officials as well as guilty pleas and their sworn factual bases of the public officials to whom Gilbane providedthe illegal gifts and who voted on the contracts. Sweetwater also offered the sworn criminal grand jury testimony of Gilbane’s Program Director and a Chief Executive Officer of the Gilbane/SGI Joint Venture who, along with another SGI manager, testified at length as to the extravagant gifts they gave, using their credit card receipts and calendars to confirm the dates and amountsofthe gifts given. Gilbane would have the Court ignore such evidenceatthis early, pre-trial stage so as to avoid altogether the day of reckoning for the political corruption scandal Gilbane played an instrumentalrole in creating. Such a result is contrary to the purpose andintent of the anti-SLAPP statute. Yl. STATEMENT OF THE CASE A. Procedural History Sweetwater commencedthis action after a new, interim Board of Trustees authorizedits filing following the guilty pleas and removal from office of four of the five members of the Board of Trustees for abusing their position of trust with respect to public contracts. Sweetwater’s complaint alleges Gilbane, the Gilbane/SGI Joint Venture, and an additional defendant the Seville Group, Inc. (“SGI”) engaged in an elaborate scheme to lavish expensive dinners,trips and other gifts on the District’s former superintendent and several members of the Board, whoin turn voted to award defendants a series of contracts in violation of Government Code § 1090. The complaint seeks to void the District’s program management contracts with all three entities and to require them to disgorge the monies Sweetwater paid them under these contracts to manage their bond program and school construction. The SLAPP process provides for summary disposal of appropriate lawsuits through a special motion tostrike under section 425.16, commonly referred to as an “anti-SLAPP motion.” [It] requires the court to engage in a two-step process. First the court decides whether the defendant has madea threshold showingthat the challenged cause of action is one arising from protected activity. The moving defendant’s burden is to demonstrate that the act or acts of which theplaintiff complains were taken ‘in furtherance of the [defendant]’s right of petition or free speech under the United States or California Constitution in connection with a public issue....If the court finds such a showing has been made,it then determines whetherthe plaintiff has demonstrated a probability of prevailing on the claim. Equilon Enterprises v. Consumer Cause, Inc. (2002) 29 Cal.4th 53, 67. Gilbanefiled an anti-SLAPP motion in which the Gilbane/SGI Joint Venture joined. The trial court denied the motion underthefirst prong of the anti-SLAPPstatute on the ground that the conduct underlying the complaint was illegal as a matter of law and therefore was not protected by the Constitutional guarantees of free speech and petition. Other than addressing and ruling on Gilbane’s objections to evidence, the trial court did not rule on the second prong, whether Sweetwater had met its burden to establish its case had the requisite minimal merit to proceed forward. Appellant’s Appendix (“AA”) 1477-1478, 1479. The Court of Appeal affirmed. Sweetwater, supra, 245 Cal.App.4th at p.19. The Court of Appeal held that while the evidence that Sweetwater presented mayestablish that some ofthe conduct may havebeenillegal, the evidence did notestablish that all of the conductat issue wasillegal as matter of law, as someof the contributions were to pageants, charities or campaigns. Thus the Appellate Court did not agree with thetrial court that the anti-SLAPP motion could be resolved in Sweetwater’s favoronthefirst prong. Asa result, the Appellate Court looked to the anti-SLAPP second prong—whetherthe District showed a probability of prevailing on its claims—and addressed and affirmed the Superior Court’s evidentiary rulings on the proffered guilty pleas, the narratives supporting the factual basis for those guilty pleas, as well as to certain grand jury testimony and documents presented to the grand jury. The Appellate Court noted that both Sweetwater and Gilbane requested judicial notice of the plea forms reflecting the guilty or no contest pleas. Sweetwater, supra, 245 Cal.App.4th at p.28, fn. 8. AA 34 -35, 481-482, 483-547, 603-606. Gilbane’s Petition For Review did not contest all of the findings and holdings of the Court of Appeal. Rather, it confinedits petition to the evidentiary rulings and the portion of opinion about the use and “admissibility” of the guilty pleas, their attached narratives supporting the factual bases ofthe guilty pleas, and the grand jury testimony and exhibits about which the witnesses at the grand jury testified. The sole issue here is whetherthis testimony given under oath can be admissible evidence used to oppose an anti-SLAPP motion because such testimony is equivalent to an affidavit. Petitioner asserts that it cannot, however for the reasons set forth herein, Petitioner is wrong in each ofits assertions. B. Statement of Facts The District’s causes of action for violations of Gov’t Code § 1090 allege that former Superintendent Gandara and several former Board members had prohibited financial interests in contracts with the named defendants. 1 AA 50 et seg. The prohibited financial interests that District officials had in those contracts came asa result of activity by the principals and managersofthe Gilbane/SGI Joint Venture. In 2000, California voters approved Proposition 39, which reduced the voting threshold for the passage of school bonds from two-thirds to 55 percent, in turn increasing the numberofvoter-approved school facilities bonds. Sincethis time, voters in the Sweetwater Union High School District have approved two separate propositions designed to fund school improvements — in 2000, Proposition BB, a $187 million bond, and in 2006, Proposition O, allowing the District to issue $644 million in bonds. 1 AA 52, 248; 3 AA 607-620. Both propositions allowed the District to hire program managers to monitor the construction projects. Jd. Harris/Gafcon (hereinafter “Harris”) was hired by Sweetwater as the program managerfor the Proposition BB. 5 AA 1246 at paragraph 3. Harris hadstellar performancereviews for Proposition BB work and exceeded the expectations of those who were in charge of the program. Jd. at paragraph 4 and 5 AA 1232 at paragraph 4. Harris finished the Proposition BB projects ahead oftime, and their work quality was very good. Id.’ i Gilbane and SGIsought to becomeprogram managersfor Proposition O while wining and dining key Districtofficials. In the months before the November 2006 election when Proposition O wason the ballot, Gilbane and SGI began providing expensive dinners and sporting event tickets to key District officials, as follows: ' Appellants argue their performance as program manager was exemplary. However, no forensic audit was ever done to determine if the Gilbane/SGI joint venture overcharged the District for program management or committed fraud. After they were replaced, the same work was donefor 60% less than what was charged by SGI. See Declaration of Tom Calhoun at 5 AA 1223-24 and Declaration of Eric Hall at 5 AA 1226-27. By Whom To Whom When and What In Appellate Recordat Flores Sandoval 2/17/06 - mealat 4 AA 999,at pg. Anthony's 1546:4-8, 1546:28-1547:7 Flores Quifiones 2/17/06 - mealat Id, Greystone Amigable Sandoval 9/22/06 - mealat 4 AA 960-61, at Baci pg. 351:16- 354:22 Flores Gandara and 10/05/06 - dinner at 4 AA 1000,at Sandoval Flemings pg. 1554:21- 1555:4 Amigable Sandoval 10/12/06 - dinner at 4 AA 962,at pg. Morton's 357:14-358:19 Flores Sandoval 10/27/06 - dinner at 4 AA 1001, at Lou & Mickey's pg. 1558:26- 1559:17 On November7, 2006, Proposition O was approved. 1 AA 52. Soon thereafter, then-Superintendent Gandara indicatedhis plans tore- compete the program managementservices work for Proposition O instead of allowing Harris to continue the work which they were already doing underthe existing Proposition BB bond. 5 AA 1246 at paragraph5. Gandara sought to replace Harris despite good performancereviews for Proposition BB work. 5 AA 1025 at pg. 2885:6-17. In her declaration filed in opposition to the anti-SLAPP motion, Sweetwater’s Director of Planning and Construction and at one point Assistant Superintendent Katy Wright stated that the Proposition BB projects were being managed“ahead of time” and “[t]heir work quality was very good.” AA 1245-1247. Ms. Wright who “wasdirectly involved with the managementofthe Proposition BB bond,”attested that when she heard that Gandara wasnot planning to use Harris/Gafcon for the new Proposition O construction work, she informed Gandarathat “the District would essentially lose a year becauseit would take a while for a new team to get up to speed and understand what happenedat each of the campuses.” Shealso “relayed” to Gandara “the good quality of work that [Harris/Gafcon] performed for the District on Proposition BB.” In addition, despite Wright’s expertise “with respect to managing the work done under the bond measures,” she was “not asked to participate or provide the criteria by which the program managerwasto be selected,” and was “not allowed to participate” in the decision to select the Joint Venture even after she asked to participate. AA 1245-1247. Gilbane and SGI continued giving financial inducements to District officials. Amigable provided Sandoval with tickets to a San Diego Chargers gamethat cost $415 each. 4 AA 936 at pg. 362:19-363:18. Amigable provided a dinner to Gandara and Sandovalat Po Pazzo that cost $1,416.08. 4 AA 964 at pg. 364:21-367:5. On February 20, 2007, the Board directed Gandara toinitiate the Request for Proposal/Request for Qualifications (“RFP/RFQ”) process for the Proposition O program managementservices. 5 AA 1036at pg. 1446:25-1447:15 and 1171-1173. Initially when the RFP/RFQ was submitted, there was a clause prohibiting proposers from contacting any District official or Board member. 5 AA 1127. This clause was necessary “to maintain the integrity of the process” and prevent improper “attempts to influence the process”. 5 AA 1030-1031, at pg. 1293:26-1294:4. Gandara had this clause removed. 5 AA 1235 at paragraph4. These initial dinners and tickets werejust the tip of the iceberg of what became a routine pattern of enticement betweenthe private contractors and District officials. In the two months between whenthe “no contact” clause was removed and when the District Board approved hiring the Gilbane/SGIJV, its people had significant contact with several Board members, as is shown below: By Whom To Whom Whenand What In Appellate Record at Amigable Sandoval and 03/09/07 - $1,383 4 AA 966-968,at and Flores Ricasa dinnerat Baci pg. 381:26- including flying in 384:28 and lobsters, plus 386:9-387:25 $538.50 for wine Amigable Sandoval and 03/30/07 — $729 4 AA 968-68,at Smith dinner pg. 398:22-400:7 Amigable Sandoval 04/14/07 - tickets to 4 AA 969,at pg. Athletics-Yankees 400:15-401:12 baseball game, paid $1,285.75 for food and beverages Flores Quifiones 04/19/07 — dinner 4 AA 1005-06,at pg. 1574:10- 1576:4 Amigable indicated that he wanted to show the March 9 dinnerattendees that he was “willing to get them nice wine”and that he wanted them to expect that “if we are going to dinner, we are going to a nice dinner.” 4 AA 966 at pg., 383:4-12. The reason for this was, as SGI’s Florestestified: You said you had no assurances that your contributions would result in a winning selection. But were you confident that a lack of contributions would guarantee you would not be selected? A. I would say so. 4 AA 1004 at pg. 1568:1-5. ii, After lavish entertainment expenditures, Gilbane and SGI were awardedtheirfirst District contract, and their expenditures increased. Gilbane and SGI’s efforts paid off quickly. On April 21, Gandara called Amigable to indicate he was going to recommend them to the Board 2 despite opposition to the change and support for Harris from within. 4 AA 970-971 at pg. 407:16-408:25, 410:26-411:8. During this call, Gandara asked Amigable to draft a “white paper” to help Gandara defendhis position of why the Gilbane/SGI JV wasselected over Harris, in anticipation of concerns over the selection. 4 AA 971 at pg. 408:2-25. Amigabletestified the whole purposeofthe “pre-sell” was to establish a relationship so Gandara would call him forhelp like this in getting the Gilbane/SGI JV selected. Jd. at pg. 410:11-21. On April 24, 2007, Gandara recommended that Gilbane and SGI provide program managementservices for the Proposition O Bond Measure. 3 AA 621. That same day, Board action authorized the District to negotiate a permanent contract. Id. SGI’s CEO Florestestified that he believed that SGI would experience negative consequencesifhe did not acquiesce to the Board members’ demandsfor further gifts. 4 AA 1003 at pg. 1565:2-26. As such, Gilbane and SGI provided additional financial inducements in the weeks between the April 24 vote to negotiate a contract and the next vote on the permanent contracts on May 16, 2007. SGI provided $15,000 to the Mariachi event at the bequest of Sandoval and Gandara. 4 AA 1007 at pg. 1586:28-1587:27. Amigable provided dinner to Board memberRicasaat a restaurant in Point Lomathat cost $313. 4 AA 972-73,at pg. 414:6-418:6. iii. District officials awarded the Gilbane/SGI Joint ' Venture multiple contracts after months ofexpensive dinners, theater tickets and an all-expense paid New Year’s Eve weekendat the Rose Bowl. On May16, 2007, the Board including Trustee Pearl Quifiones, Arie Ricassa and Greg Sandoval unanimously approved two agreements with the Gilbane/SGI Joint Venture—the interim Proposition O program management agreement and the program management agreementto complete Harris’ Proposition BB Projects. 1 AA 53, 66-85; 3 AA 627-628, 648, 652-671. The wining and dining then continued at an incredible rate in the eight months between the May 2007 approvalofthis interim 10 Proposition O contract and the January 2008 approval of the permanent contract. While the permanent Proposition O program management agreement wasbeing negotiated, the financial courting became more elaborate: By Whom To Whom When and What In Appellate Record at Amigable Gandara and 06/16/07 - dinner at 4 AA 974,at pg. Quifiones Baci 422:15-423:12, 4 AA 975,at pg. 425:2-6 Ortiz Sandoval and 07/20/07 - dinner at 5 AA 1042, at Gandara Bertrand at Mr. A's pg. 1863:12-20, 4 AA 1008,at pg. 1595:7-16 Ortiz Quifiones 08/03/07 - dinner at 5 AA 1043, at Bertrand at Mr. A's pg. 1866:14-26 Ortiz Quifiones 09/04/07 - dinner at 5 AA 1042,at Buon Giorno pg. 1863:21- 1864:14 Amigable Gandara 09/08/07 - dinner at_ 4 AA 977,at pg. Loews Coronado 453:1-454:2 Bay Resort Amigable Gandara 09/08/07 - gondola Jd. ride at Loews Coronado Bay Resort Amigable Sandoval and 09/13/07 - beverages 4 AA 976-77, at Gandara at Hotel Del pg. 451:24- Coronado 452:12 Amigable Gandara 10/11/07 - dinner at 4 AA 978, at pg. Flemings 462:9-463:19 Amigable Gandara 10/11/07 - tickets to Jd. La Jolla Playhouse Amigable Gandara and 10/26/07 - dinner at 4 AA 979,at pg. 11 By Whom To Whom When and What In Appellate Record at Sandoval Baci 466:28-468:14 Amigable Quifiones 11/05/07 - tickets to 4 AA 980,at pg. and Flores see Jersey Boys 469:7-471:24 Amigable Quifiones 11/08/07 - dinner at Jd. and Flores Morton's Amigable Gandara 11/10/07 - tickets to Jd. and Flores see Jersey Boys Amigable Gandara 11/10/07 - dinner at 4 AA 981, at pg. and Flores Fleming's 472:13-473:11 Amigable Sandoval and 12/08/07 - dinner at 4 AA 981-82, at Gandara Top of the Market pg. 475:16- 476:21 Amigable Sandoval and 12/08/07 - drinks at 4 AA 982, at pg. Gandara Top of the Hyatt 475:16-477:14 Amigable Gandara 12/17/07 - Holiday 5 AA 1045,at get-together for pg. 1880:24- Gandara'sstaff at 1881:16 Frida's Ortiz Sandoval 12/17/07 - dinner at 5 AA 1045,at Rei Do Gado pg. 1878:26- 1880:6 Ortiz Sandoval 12/17/07 - tickets to Jd. the Lyceum Theatre Ortiz Sandoval and 12/31/07 - dinner at 4 AA 1010, at Gandara Twin Palms pg. 1616:26- 1618:20 4 AA 1011-12, at pg. 1623:22- 1624:10 Ortiz Sandoval and 12/31/07 - suites at I. Gandara the Biltmore Hotel Ortiz Sandoval and 01/01/08 - Rose 4 AA 1010,at Gandara Bowltickets pg. 1617:26- 1618:6 Amigable Sandoval, 01/05/08 - dinner at 4 AA 983, at pg. Gandara and Morton’s 487:2-27 others 12 By Whom To Whom When and What In Appellate Recordat Amigable Sandoval 01/25/08 - dinner at 3 AA 511, facts Fish Market 96, 97 Certain extravagant expenditures during this timeframe are noteworthy. In November 2007, Amigable and Flores provided Quifionestickets to see the play “Jersey Boys” at a cost of $90 per ticket and took her to a dinnerat Morton’s Steakhouse that cost $711.23. 4 AA 980, at pg. 469:7-471:24. Less than one week later, Amigable and Flores also providedtickets to Gandara and his family to see the play “Jersey Boys,”this time at a cost of $165 per ticket. 4 AA 981, at pg. 472:13-473:11. On top ofthe theater, Amigable and Flores also provided dinner that evening to the Gandara family at Fleming’s Steakhousethat cost $625.22. 4 AA 981, at pg. 472:13-473:11. On New Year’s Eve weekend 2007, SGI treated Gandara and Sandoval as well as their families to a weekend in Pasadenato celebrate the Rose Bowl. SGI provided dinner at the Twin Palms Restaurantin Pasadena, hotel suites at the Los Angeles Biltmore Hotel, as well as nine Rose Bowltickets for Gandara and Sandoval. 4 AA 1010, at pg. 1616:26- 1618:20,4 AA 1011, at pg. 1623:22-1624:10. iv. District officials reward the Gilbane/SGI Joint Venture with yet another lucrative contract. After the lavish dinners, theater tickets, and Rose Bowl weekend, the Board approved the permanent Proposition O program management services contract on January 28, 2008, with Sandoval, Quifiones and Ricasa all voting yes. 1 AA 53, 87-147, 163-223; 3 AA700, 711; 4 AA 717-777. In the four months betweenthis vote and a lucrative contract amendment, the following financial benefits were provided: 13 By Whom To Whom When and What In Appellate Record at Amigable Sandoval and 02/01/08 - $854.21 3 AA 514,facts Gandara dinnerat Baci 106, 107 Amigable Quifiones 02/22/08 - $243 3 AA 515,facts dinner at Dobson's 108, 109 Amigable Sandoval and 02/23/08 - $957.41 3 AA 515,facts Gandara dinner at Top ofthe 110,111 Market Amigable Quifiones 03/07/08 - $285.29 3 AA 515-516, dinner at Donovan's facts 112, 113 Amigable Sandoval, 03/14/08 - dinner at 3 AA 516,fact Gandara and Island Prime 114 Ricasa Amigable Gandara 03/25/08 - $378.38 3 AA 516,facts dinner at Baci 115, 116 Amigable Gandara 03/27/08 - 3 AA 516,fact discounted plane 117 ticket Amigable Quifiones 04/04/08 - dinner at 3 AA 516,fact Po Pazzo 118 Amigable Quifiones 04/2008 - discounted 3 AA 517, fact plane ticket 119 On May20, 2008, the Board approved an Amendment/Supplement to the program management agreement with the Gilbane/SGIjoint venture, with Sandoval, Quifiones and Ricasa again voting yes. 4 AA 778, 787-788, 792-794. This three page amendment expandedthe contract scope to include “construction services” for which the joint venture ultimately received $7,466,762.88. 4 AA 792, 5 AA 1237-38, 4 AA 895 and 4AA 896. Morefinancial benefits followed. In Novemberof2008, SGI provided a lavish trip for Gandara and his wife. SGI providedthe plane tickets to fly to Northern California and paid for three nights of hotel 14 accommodations, multiple wine tastings, and a hot air balloon ride that cost $245 per person. 5 AA 1048-49, at pg. 1926:19-1928:3, 5 AA 1050,at pg. 1050, at pg. 1931:9-17, 5 AA 1050, at pg. 1931:24-1932:4, 5 AA 1050,at pg. 1933:22-28, and 5 AA 1052,at pg. 1939:14-1940:22. Thetrip itself caused SGI’s Program Manager Jaime Ortiz to exceed his credit card limit, which SGI internal communications stated was “worth it.” 5 AA 1051, at pg. 1937:28-1938:11, 4 AA 1013, at pg. 1653:6-1654:18, and 4 AA 1013, at pg. 1655:5-27. SGI alone was awarded the June 2010 contract for which SGI received $9,034,423.06. 4 AA 795 and 897. Separate from this contract the Gilbane/SGI JV received over $17 million. 5 AA 1239-40, at §§ 12-15, 4 AA 0879-92, 5 AA 1238-39, at Jf 6-8, 4 AA 893, 4 AA 894, 5 AA 1237- 38, at ff 3-5, 4 AA 895, and 4 AA 896. C. The Guilty Pleas Gilbane’s former Program Director Henry Amigable pled guilty’ to violating Education Code §35230, which prohibits offering any valuable thing to a memberofthe governing board of any schooldistrict with the intent to influencehis/her action in regard to the making of any contract before the schooldistrict’s governing board. 2 AA 388, et seg. Under penalty of perjury, Amigable stated in writing in the factual basis to his plea and later confirmed in open Court the following: Between March 9, 2007 and June 22, 2010 I providedgifts, meals andtickets to entertainment events directly to Jesus Gandara, Superintendent, Greg Sandoval, elected Board member, Arlie Ricassa, elected Board member, and Pearl Quifiones, elected Board member, of the Sweetwater Union High SchoolDistrict. I provided the meals, tickets and gifts upon myinitiative as sanctioned and encouraged by my * Appellants claim Amigable pled no contest. The reporter’s transcript from Mr. Amigable’s change of plea hearing unequivocally reflects he pled “guilty.” See 6 AA 1450 at lines 16-20 and 1452 at lines 4-6. 15 employers. I also provided meals, tickets and gifts at the request of the elected board members and the Superintendent. The meals, tickets and gifts were made on behalf ofmy employers with the intent to influence the boards’ decisions in granting construction contracts from the Sweetwater Union High SchoolDistrict to the firms for which I was working. Myexpenses were generated with the endorsement ofmy employers and they were reimbursed to me by my employers. At no time did the elected board members or Superintendent reimburse me or my employers for the meals,tickets or gifts I gave them on behalf ofmy employers. 2 AA 389, 392, 5 AA 1175, 1178 and 6 AA 1448-1454, especially 1452 line 11 through 1453 line 6. SGI’s CEO ReneFlores also admitted his illegal conduct—hepled no contest to aiding and abetting a violation of Gov’t Code § 87203’s reporting requirements which require public officials such as school board membersto disclose sources of their income. 2 AA 394, et seq. Also in writing and under penalty of perjury, Mr. Flores stated in the written factual basis to his plea: Between March 9, 2007 and June 22, 2010, I provided donations, meals, gifts, and tickets to entertainment events directly to Jesus Gandara, Superintendent, Greg Sandoval, elected Board member, Arlie Ricassa, elected Board member, and Pear! Quifiones, elected Board member, of the Sweetwater Union High School District as requested by these public officials. At no time did the elected board members or Superintendent reimburse me for the donations, meals, tickets or gifts. 2 AA 395, 398, 5 AA 1180, 1183. Mirroring Amigable’s and Flores’ pleas are those of the District’s former Superintendent and several former Board members. Theseare the same individuals that Amigable admitted he had an “intent to influence” regarding “construction contracts from the Sweetwater Union High School District to the firms for which [he] was working” and the sameindividuals 16 that Flores pled he aided andabettedin their gift disclosure reporting violations. Former Board member Sandoval pled guilty to violating Penal Code § 182 (a)(1) and Gov’t Code §89503,a felony crime of conspiracy to violate the Political Reform Act’s prohibitions against accepting gifts above the specified legal limit. 2 AA 411, et seg. Under penalty ofperjury, Sandoval admitted in the written factual basis to his plea and later in open Court: In 2008, I was an elected School Board Memberfor the Sweetwater Union High School District. I accepted gifts from Henry Amigable in 2008 with a total value of more than $2,770 and I did not report them. The maximum amount of gifts one may receive from one source per year as of 2008 was four hundred twenty dollars ($420). Henry Amigable provided these gifts with the intent to influence my vote on business awarded to Gilbane, his employer. 2 AA 413, 414 and 5 AA 1204, 1205 and 1206-1213, especially 1210 line 23 through 1211 line 12. Former Board member Quifiones pled guilty to the same felony violation of Gov’t Code § 89503 as Sandoval. 2 AA 406,et seq. In the written factual basis to her plea and underpenalty of perjury, Quifiones admitted: In 2007, I was an elected School Board Memberfor the Sweetwater Union High SchoolDistrict. I accepted gifts from Henry Amigable in 2007 with a total value of in excess of $500 and I did not report them. The maximum amount of gifts one may receive from one source per year as of 2007 was three hundred and ninety dollars ($390). Henry Amigable provided these gifts with the intent to influence my vote on business awarded to Gilbane, his employer. 2 AA 408, 409 and 5 AA 1196, 1197. 17 Former Superintendent Gandara pled guilty to the same felonious crime as Sandoval and Quifiones. 2 AA 394, et seg. In the written factual basis to his plea and under penalty of perjury, Gandara admitted: In 2008, I was the Superintendent of Sweetwater Union High SchoolDistrict. I accepted gifts from Rene Flores from SGI in 2008 with a total value of more than $4,500 and I did not report them. The maximum amountofgifts one may receive from one source per year as of 2008 was four hundred twenty dollars ($420). Rene Flores providedthesegifts with the intent to influence my decision on business awarded to SGI, his company. 2 AA 418, 419, 5 AA 1200, 1201. Former Board memberRicassa pled guilty to violating Gov’t Code §89503, which is the Political Reform Act’s prohibition against accepting gifts abovethe specified legal limit. 2 AA 400,et seq. In the written factual basis to her plea and underthe penalty of perjury, Ricasa admitted: In 2009, I was an elected School Board Memberfor the Sweetwater Union High School District. I accepted gifts from Rene Flores (SGDin 2009 with a value of $2,099 and I did not report them. The maximum amountofgifts one may receive from one source per year was four hundred twenty dollars ($420). Rene Flores provided these gifts with the intent to influence my vote on business awardedto Seville Group,Inc. AA 402, 404, 5 AA 1191, 1193. Mr. Amigable’s plea form states: “I declare under the penalty of perjury, underthe lawsofthe state of California, that I have read and understood andinitialed each item above and any attached addendum and everything on the form and any attached addendumis true andcorrect.” The plea forms of Flores, Quifiones, Gandara and Sandoval all contain the identical “under oath of penalty of perjury” language. Ricasa’s plea form is substantially identical but is a slightly different format. 18 Ao D D R A G Assuming the foregoing statements whichare part of the factual basis of each guilty plea are admissible, it is clear that the conduct in question was illegal and designed to corruptly influence the votes of the officials involved. The grand jury testimony, the declarations of former and current Sweetwater employees, and the guilty pleas collectively establish aprimafacie violation of Government Code § 1090. See AA 1231-1233 (Husson), 1234-1236 (Leyba), and 1245-1247 (Wright). Accordingly, Gilbane cannotshield itself from the consequencesofits corrupt conductutilized to secure public contracts. Ii. STANDARD OF REVIEW Anorder granting or denying an anti-SLAPP motion is reviewed under a de novo standard. Soukup v. Law Office ofHerbert Hafif(2006) 39 Cal.4th 260, 269, fn. 3. If the trial court’s decision is correct on any theory, the anti-SLAPP order must be affirmed. San Diegansfor Open Governmentv. Har Construction (2015) 240 Cal-App.4th 611, 622. On appeal, courts “review ruling on an evidentiary objection in connection with a special motion to strike for abuse of discretion.” Hall v. Time Warner, Inc. (2007) 153 Cal.App.4th 1337, 1347-1348, fn. 3. As in all reviewsof discretionary determinations, the trial court abusesthis discretion if it rests its ruling on an error of law. See, e.g., Connerly v. State Personnel Bd. (2006) 37 Cal.4th 1169, 1171-1176. However, a ruling or decision, itself correct in law, will not be disturbed on appeal merely because given for a wrong reason. If right on any theory of the law applicableto the case, it must be sustained regardless of the consideration which may have movedthetrial court to its conclusions. Davey v. Southern Pacific Co. (1897) 116 Cal. 325, 329, applying rule to an evidentiary ruling. 19 IV. LEGAL ARGUMENT: BECAUSE THE PURPOSE OF THE SECOND PRONG OF THE ANTI-SLAPP STATUTEIS TO DETERMINEIF THE REQUISITE MINIMAL MERIT TO PROCEED EXISTS, A STATEMENT UNDER OATH WHICH A WITNESS CAN TESTIFY TO WITHOUT OBJECTION SHOULD BE ADMISSIBLE TO DETERMINE THE PROBABILITY OF PREVAILING. A. Introduction The anti-SLAPPstatute is intended to truncate lawsuits arising from conductprotected by the First Amendment. The anti-SLAPPstatute does not insulate defendants from all liability for claims arising from protected conduct; it only provides a procedure for weeding out, at an early stage, meritless claims arising from protected activity. Baral v. Schnitt (2016) 1 Cal.5th 376, 384. In Baral, this Court held that a “special motionto strike” may notbe avoidedbyartful pleading if such claims are mixed with assertions of unprotected activity. Jd. at p. 393. One weekafter Baral, this Court again addressed the anti-SLAPP statute in a case similar to the one now before the Court. This case and City ofMontebello v. Vasquez (2016) 1 Cal.5th 409 both involve the application of the anti-SLAPP statute where the complaint alleges violation of one of California’s preeminent anti-corruption statutes, Government Code § 1090, but there is one significant factual difference between the cases. Montebello only involved legal campaign contributions, while this case concerns contractors giving lavish, illegal gifts to public officials including expensive dinners; theatre, sporting and planetickets; hotel rooms; wine tastings; payments for sibling’s beauty pageants; and large donationsto charities for public officials and their friends. In Montebello, this Court reaffirmed the broad application and reach of the anti-SLAPPstatute for acts which are in furtherance of a person’s right of petition or free speech in connection with a public issue. Jd. at 416. 20 However, the broad application ofthe first prong of the anti-SLAPPstatute has at times prompted concerns. For example, after citing legislative history and intent, Justice Baxter noted in his dissent in Briggs that SLAPPs are generally meritless suits brought by large private interests to deter commoncitizens from exercising their political or legal rights. Briggs v. Eden Councilfor Hope & Opportunity (1999) 19 Cal.4th 1106, 1129. He went on to state an “overly broad construction of section 425.16 subdivision (e)(1) and (2) will also likely have a significant impact on pretrial civil litigation in California.” Jd. Twoyearslater, in Navellier, Justice Brown(in a dissent joined by Justices Baxter and Chin) stated a “presumptive application of section 425.16 would burden parties with meritorious claims and chill parties with non-frivolous ones,” warning that “(t]he cure has becomethe disease -SLAPP motions are nowjust the latest form of abusivelitigation.” Navellier v. Sletten (2002) 29 Cal.4th 82, 96. Indeed, the broad application of the anti-SLAPPstatute to claims brought pursuant to Government Code § 1090 morerecently raised a concern thatit could make it harder to enforce civil laws against public corruption. See Montebello, supra, | Cal.5th at p. 427, 431. In this third case of the recenttrilogy, this Court is asked to decide whether the broad application of the anti-SLAPP statute’s first prong is counter-balanced by the evidentiary standards by whichtrial courts should evaluate a plaintiff's primafacie showing offacts to meet its burden of establishing a probability of prevailing on their claim. See Soukup, supra 39 Cal.4th at p. 291. Acting as a procedural device for screening out meritless claims, the anti-SLAPP statute establishes “a summaryjudgment— like procedureat the early stage oflitigation.” Varian Medical Systems, Inc. v. Delfino (2005) 35 Cal.4th 180, 192; see also Jarrow Formulas, Inc. v. LaMarche (2003) 31 Cal.4th 728, 739; Soukup, supra, 39 Cal. 4th atp. 278-279. Given that one of the hallmarks of the anti-SLAPP motion is the 2] short time forfilings and hearings and stay on all discovery pending resolution (see Varian, supra, 35 Cal.4th at p. 192), the standards which are applied to the second prongofthis screening device become equally important in order that courts avoid an application that would burden parties with meritorious claimsorchill parties with non-frivolous ones. B. The Court of Appeal Used Its De Novo Authority To Determine that the anti-SLAPP Requirements Were Met. While the trial court ruled that the protected activity was illegal as a matter of law and decided the case underthe first prong, the Appellate Court disagreed, stating “while the evidence mayestablish that some of the conduct may have beenillegal, the evidence does notestablish that all the conductat issue wasillegal as a matter of law.” Sweetwater supra, 245 Cal.App.4th at p. 44. As result, the Appellate Court proceeded to the second step, evaluating whether the District met its burden to show a probability of prevailing on the merits. See Montebello, supra, 1 Cal.5th at p. 424-425; Flatley v. Mauro (2006) 39 Cal.4th 299, 316. The Appellate Court concluded, “Sweetwater has demonstrated a probability of prevailing on its 1090 claims against defendants, thereby defeating defendants’ anti- SLAPP motion with respect to the second prong of the anti-SLAPP analysis.” Sweetwater, supra, 245 Cal.App.4th at p. 51. C. The Sworn Statements Containing The Factual Basis For Multiple Guilty Pleas Are Admissible Here AsAffidavits Gilbaneidentifies the issue presented for review as “Is testimony given in a criminal case by non-parties to a later civil case subjectto Evidence Code § 1290, et seq. setting conditions for receiving former testimony in evidence?” This characterizes the issue too narrowly and does not address the issue decided by the Appellate Court under the second prong. The question here is whetherthe criminal guilty pleas and the narratives which describe the factual bases of each guilty plea, as well as the grandjury testimonyofthe principal and employees of the Gilbane/SGI 22 Joint Venture constitute “evidence” which a court can rely on in deciding whethera plaintiff made aprimafacie showing of the meritsof its case. Navellier, supra, 29 Cal.App.4th at p. 94. The short answeris, why not? This Court has repeatedly held that under this second prong ofthe anti-SLAPP motion, whatis required is only a showing of minimal merit to proceed forward. Navellier, supra, 29 Cal.App.4th at p. 94, 96; Jarrow, supra, 31 Cal.4th at p. 741; Briggs, supra, 19 Cal.4th at p. 1123. In evaluating the minimallevel of legal sufficiency, the court does not weigh the credibility or comparative strength of competing evidence,andit is the court’s responsibility to accept as true evidence favorableto the plaintiff. Soukup, supra, 39 Cal.4th at p. 291. The rationale for only requiring a “primafacie showing of a requisite minimal merit” is that this second prong is analyzedat the outset of the case with an automatic discovery stay in place the momentthe anti-SLAPP motionis filed.’ Civ. Proc. § 425.16 (g); Varian, supra, 35 Cal. 4th at p. 192; Equilon, supra, 29 Cal.4th at p. 65. Because plaintiffs have little time to prepare an opposition and noreal opportunity to conduct formal discovery before opposing the motion, the threshold for showing minimal merit to proceed logically must be lower than for summaryjudgment motions. i. What as an affidavit? When the Legislature set up what courts now refer to as the two- prong anti-SLAPPanalysis, it provided that “the court shall consider the pleadings, and supporting an opposing affidavits stating the facts upon > The anti-SLAPP statute does provide that a court canlift the stay for specified discovery. Sweetwaterfiled such a motion, which Gilbane opposed andthetrial court denied. Respondents’ Appendix (RA) 005-060, 105. This motion sought to lay the foundation for the admissibility of the grandjury transcripts and exhibits. Sweetwater did submit a declaration attesting to the authenticity of the grand jury transcripts and the certificates of the official court reporter for the grand jury. AA 1456-1457, AA 1474. 23 which the liability or the defense is based.” CCP § 425.16(b)(2)(italics added). The legislation provided no specific definition of whatis or is not acceptable as an affidavit within the context of the anti-SLAPPstatute. However, the term “affidavit” is specifically defined at CCP § 2003, which provides, “An affidavit is a written declaration under oath, made without notice to the adverseparty.” This definition ofaffidavit is supplemented by reference to CCP § 2002, which describes the mannerin which testimony maybetaken. According to § 2002, the testimony of witnesses is taken in three modes: 1. By affidavit; 2. By deposition: 3. By oral examination. Thus,an affidavit is distinct from deposition (which is defined in CCP § 2004 as a written declaration under oath made upon notice and subject to cross-examination) and an oral examination (defined in CCP §2005 as an examinationin the presence of the jury ortribunal heard from “the lips of the witness’’). Necessarily, an affidavit is distinct from both deposition and oral examination. Nothing in the code requires that an affidavit be subject to cross-examination. It is simply a declaration reduced to writing and made underoath. it. When and how an affidavit can be used. Section 2009 of the Code of Civil Procedure outlines how and when an affidavit or declaration maybe used, providing that “[a]n affidavit may be usedto verify a pleading or paper in a special proceeding, to prove the service of the summons,notice, or other paper in an action or special proceeding, to obtain a provisional remedy, the examination of witnesses, or a stay of proceedings, and in uncontested proceedingsto establish a 24 record of birth, or upon a motion, andin any othercase expressly permitted by statute.” (Italics added.) Code of Civil Procedure § 2015.5 provides that an individual making a statementby affidavit or declaration must attestto its truth under penalty of perjury pursuant to California law and further states that, if executed within California, the “certification or declaration maybe in substantially the following form: I certify (or declare) under penalty of perjury that the foregoing is true and correct: (Date and Place) (Signature) Or, if executed anywherein or outside of California, in the following form: I certify (or declare) under penalty of perjury under the laws of the State of California that the foregoing is true and correct: (Date) (Signature) The Appellate Court held that “each plea form submitted by Sweetwater...meets the requirements set forth in section 2015.5... [flor this reason, we concludethat the forms reflecting the guilty and no contest pleas, including the written factual narratives incorporated into the pleas, are in all material respects indistinguishable from declarations or affidavits.” Sweetwater, supra, 245 Cal.App.4th at 37. Affidavits are commonly used in motion practice. They provide evidentiary authority for the motion and opposition. An exampleoftheir use occurs in summary judgmentmotions, where the Legislature did 25 specifically state that the contents of affidavits in such motions “shall set forth admissible evidence, and shall show affirmatively that the affiant is competentto testify to the matters stated in the affidavits or declarations. An objection base on the failure to comply with the requirements of the subdivision, if not madeat the hearing, shall be deemed waived.” Civ. Proc. § 437c(d). While no court has yet commented on whatdistinction,if any, exists between “affidavit” as the term is used in the anti-SLAPPstatute and as is expressly described in § 437c, several decisions of this Court have stated that when it comesto evaluating the merits, the anti-SLAPPstatuteis “a summary-judgment-like procedure.” Soukup, supra, 39 Cal.4th at p. 278; Varian, supra, 35 Cal.4th at p. 192. The reference to a “summary-judgment-like” procedure likely emanates from the fact that courts do not weigh the credibility or comparative strength of competing evidence in either motion and that the court accepts the evidence favorableto the plaintiff as true. The difference between an anti-SLAPP motion and a summaryjudgment motion, however, is significantnot only in the stage of the proceedings at which eachtypical occurs butalso in the specific criteria applicable to affidavits supporting summary judgment motions. See Civ. Proc. § 437c(d). The anti-SLAPPstatute does not provide the samespecific details as to what an affidavit submitted with or in opposition to an anti-SLAPP motion must contain. While an affidavit is defined as a statement under oath, CCP § 2003 does not require that it comport with therules of evidence applicable at trial or summaryjudgmentto be admissible. Therefore, the logical interpretation of an affidavit that a court can consider when ruling on an anti-SLAPP motionis that it is a document made under oath outside of the court proceedings in which it is offered which the court may consider true for purposes of the proceeding in whichit is offered. 26 See, e.g., Civ. Proc. § 2003. Necessarily, therefore, an affidavit is hearsay in the classic sensein that it is an out-of-court statement offered for the truth of the matter asserted. Evid. Code § 1200,et seq. The Appellate Court below concludedthat “courts may receive and consider hearsay —i.e., out of court statements presented for their truth — for purposes of motion practice, as long as the statements do not contain second level hearsay or evidence that is otherwise irrelevant, not competent or substantively barred under other evidentiary rules.” Sweetwater, supra, 245 Cal.App.4th at p. 33, fn. 12. The exception for admissibility of an affidavit provided by CCP § 2015.5 is limited to a non-trial setting, such as this anti-SLAPP motion. While courts have not expressly ruled on this issue, numerouscases have assumedthataffidavits submitted in an anti-SLAPP proceeding are subject to the requirement ofproof being “made upon competent admissible evidence.” See, e.g., Paiva v Nichols (2008) 168 Cal.App.4th 1007, 1017; Hall, supra 153 Cal.App.4th at p. 1347-1348; ComputerXpress, Inc. v Jackson (2001) 93 Cal.App.4th 993, 1010 (the plaintiff may notrely solely on its complaint, even if verified; instead, its proof must be made upon competent admissible evidence). Therefore, affidavits in anti-SLAPP proceedings have been treated as subject to the same standards as an affidavit submitted pursuant to 437c. D. Petitioner Incorrectly Contends That The Statements At Issue In The Present Case Are Hearsay And Do Not Meet The Former Testimony Exception. As noted previously, all affidavits are hearsay because they are out of court statements offered for the truth of the matter asserted, and few meet any exception contained within the hearsay rule. The distinction that Petitioner fails to address is that, inmotion practice, the hearsay declaration of the affiant is permitted if it contains otherwise admissible evidence. 27 CCP §§ 2003 and 2015.5. In other words,if the declaration reflects evidencethat the affiant would be permitted to testify to if called as a witness, the declaration is admissible. This is absolutely no different than the provisions in CCP 437c applicable to summary judgment motions. i. Petitioner misconstrues thefoundational issue with respect to admissible statements in an affidavit Petitioner repeatedly refers to the proffered statements underoath as “Former Testimony.” See, e.g., Petitioner’s brief at p. 10-11. Petitioner further asserts as an additional basis for objection that the District failed to show that any of the declarants were unavailable as a witness. Jd. at p. 10. Petitioner’s argument confusesa trial with a motion and ignores the hearsay exception inherentin the statutory provisions that permit affidavits. While it is correct that the affidavits were made in another proceeding,that is irrelevant; no statute defines an “affidavit” as being admissible only in the proceeding in whichit wasfirst filed. i. These affidavits werejudicially noticable All of the guilty plea narratives and grand jury testimony werepart of the recordsofthe Superior Court of the State of California.’ Theyare therefore subject to judicial notice as the sworn statements ofthe declarants. See Evid. Code §§ 452(d)(1), 453. The court is not, however, taking judicial notice of the truth of the statements contained in these records (see, e.g., Sosinsky v. Grant (1992) 6 Cal.App.4th 1548) but rather taking judicial notice that the statement was made underoath in another judicial proceeding. Or, another way of lookingatit is that the court is * Sweetwater submitted a declaration attesting to the authentication of the certified transcripts of the grand jury testimony and provided the certifications of official reporter for the grand jury. AA 1456-1457, AA 1474. As noted in fn. 21 and 24, the Court of Appeal found that Gilbane did not argue on appeal that the grand jury transcripts were not properly authenticated or that they were not what they were purportedto be. 28 acknowledgingthatthis is the sworn statement of the declarant and, as such, is an affidavit. Whether the sworn statement was given in another proceeding does not changeits status an affidavit which is admissible as evidence in a motion hearing. E. Each Person Who Provided The Written Factual Narrative Incorporated Into His or Her Plea Form As The Factual Basis For His/Her Plea Was Competent To Testify To The Matters Therein. Attrial, affidavits and declarations such as those Sweetwater submitted in opposition to the anti-SLAPP motionhere are generally inadmissible.” However, an anti-SLAPP motionis not a trial; indeed,it is far from it. Theissue in this pre-trial setting is not whether the plea narrative is former testimony which would be admissible attrial but instead whether these persons would be competentto testify as to the facts in their plea narrative without objection if called as witnesses. Each plea form submitted by Sweetwater with respectto the anti- SLAPP motion meets the affidavit requirements of CCP § 2015.5. Specifically, each individual who signed and dated a plea form attestedto the truth of the contents, including the factual basis of his or her plea, under penalty of perjury under the laws of California. As described above at Section II(B), these witnesses would all be competentto so testify. Mr. Amigable was the former Program Director for Gilbane andis certainly competentto testify he “provided gifts, meals and tickets to entertainment events directly to Jesus Gandara, Superintendent, Greg Sandoval, elected Board member, Arlie Ricasa, elected Board member, Pearl Quifiones, elected Board member, of the Sweetwater Union ° The judgments of conviction entered as to Quifiones, Gandara and Sandoval with respect to the felonies to which they pled guilty could be admitted at a trial pursuant to the hearsay exception provided in evidence code section 1300. 29 R O D R I E M e e = High School District.” He is also competentto testify that he “provided the meals, tickets and gifts at the request of the elected board members and superintendent” and that he provided them with the “intent to influence the board’s decision in granting construction contracts from the Sweetwater Union High SchoolDistrict to the firms for which I was working.” Heis further competentto testify that the elected board members or superintendent did not reimburse him or his companies for the meals, tickets or gifts he gave them. Mr.Flores, the CEO of SGI,is also competentto testify that he provided meals,gifts andtickets to entertainment events directly to the former superintendent and Board members Sandoval, Ricasa and Quifiones; that he did so as requested by these public officials; and that no time did they reimburse him for the donation meals tickets or gifts. Amigable and Flores’ plea narratives do not contained a secondlevel of hearsay evidence that would otherwise be barred by any other evidentiaryrules. | Similarly, Board members Sandoval, Quifiones, and Ricasa and former superintendent Gandara—each ofwhom pled guilty—are competent to testify that they accepted gifts from Mr. Amigable (in the case of Sandoval and Quifiones) and from Mr.Flores (in the case of Gandara and Ricasa) and that these gifts exceeded the dollar value describedin their pleas. Likewise, each of the former Board members whovoted on the contracts were in position to know andtestify from the extensive pattern of a gift-giving that they were providedthe gifts with the intent to influence their vote as outlined in their plea narratives. If not, Mr. Amigable and Mr. Flores clearly provide evidenceofthe intent to influencein their pleas. Given that each person whopled guilty could competentlytestify as to the facts set forth in their guilty plea narratives, there is no reason why a court shouldnot consider this evidence aspart of the anti-SLAPP screening process to determine whether Sweetwater’s case met the requirements of 30 the minimal merit to proceed forward. What could have greater impactin terms ofreliability than a factual basis given fora guilty plea that acknowledges the conductgivingrise to the plea? Courts have consistently used andrelied on guilty pleas. Courts send people to prison based on guilty pleas and the factual bases of such pleas. For example, in People v. Miles (2008) 43 Cal.4th 1074, 1082-1083, the court document prepared contemporaneously with the conviction was admitted pursuant to the hearsay exception for contemporaneousofficial records prepared by public officer charged with that duty. The document described the nature of the prior conviction for official purposes and was deemedrelevant and admissible. In People v. Lee (2011) 51 Cal.4th 620, 650-651, this Court held the trial court properly took judicial notice that the defendant hadpled guilty to a misdemeanoroffense andheld that the guilty plea fell within the exception to the hearsay rule for admission of a party. Thus the court properly determined the plea document wasnot inadmissible hearsay when offer to prove the defendant’s involvementin the incidentin question. Jd. In People v. Abarca (1991) 233 Cal.App.3d 1347, 1349, 1351, the plea change transcripts and the statements in the transcripts were deemed admissible under Evidence Code section 1280 and 1220. The court noted the guilty plea was signed under the penalty of perjury, stated the party understood the charges against him and that the records contained declarations against penalinterest, thus on their face the documents disclosed nothing inherently unreliable and were admissible. /d at 1351. Here, that the court tookjudicial notice of the guilty plea forms did not create a hearsay layer. What Gilbaneactually attempts to argueis that judicial notice of a hearsay statementis automatically improperas a hearsay declaration, but that is not so. A court taking judicial notice is not making a statementas to the existenceofan official record; instead the court is 31 simply acknowledgingthatit is undisputed that the documentreflected is the record. The guilty pleas are nothing more than a statement made under oath which is memorialized in a writing and are part of a court record. These guilty pleas are not former testimonyas that term is used in Evidence Code §§ 1290-1292. As noted in the Law Revision Commission Comments to section 1290, “[t]he purpose of Section 1290 is to provide a convenient term for use in the substantive provisions in the remainder of this article.” See 7 Cal.L.Rev.Com. Reports 1 (1965), § 1290. Former testimonyrefers to testimony offered in an action or proceeding in which the testimony was given, and the party against whom the formertestimony is offered had the right to cross examine the declarant with an interest and motive similar to that which they hadat the hearing. Evid. Code §1291(a).° These substantive provisions provide that the former testimony is not made inadmissible under the hearsay rule if the declarant is unavailable as a witness and that such testimony maybereadinlieuoflive testimony. Jd. This is fundamentally different than the use of an affidavit in an anti- SLAPP motion as permitted by CCP §§ 2009 and 2015.5. F. The Grand Jury Testimony Is Also The Functional Equivalent of An Affidavit/Declaration And It Is Not Subject to Preclusion. Another premise of Petitioner’s contention is that the Appellate Court wrongly decided that the grand jury testimony could be considered the functional equivalent of a declaration, arguing it was formertestimony lacking the foundational showing that the witnesses who gavethe testimony were “unavailable”. The Court of Appeal logically heldthat: Although the transcripts of the grand jury testimony are hearsay, and therefore inadmissibleat trial unless they meet ° Evidence Code 1292 permits the introduction in civil action against a stranger to the prior action where the party in whichthe prior testimony wasgiven had the right and opportunity to cross-examine the declarant. 32 an exception to the hearsayrule, the transcripts are of the same nature as a declaration in that the testimonyis given under penalty of perjury. The grand jury transcripts, like the plea forms andthe factual narratives incorporated into those forms, may be usedin the same manneras declarations for purposes of motion practice. Sweetwater, supra, 245 Cal.App.4th at 38. In other words, the grand jury testimonyis simply a statement made under oath which can be used in the same manneras an affidavit or declaration permitted in motion practice. Nothing in the anti-SLAPP statute precludes relevant evidence that is consistent with accepted motion practice. Such evidencehas exactly the sameforce and effect under CCP § 2002 as an affidavit since that provision provides that testimonyby oral examination is an equivalentto “affidavit” as a manner in which testimony may be taken. Nothing in § 2002 requires cross-examination as a requirement of taking testimony, althoughthat could affect its admissibility at trial. Further, Petitioner does not dispute that the grand jury statements were made underoath;instead Petitioner’s objection is predicated upon the characterization of the grand jury statements under oath as former testimony. Apparently the foundational argumentis that because it was testimony not given in the present proceeding, it somehow transmutes into formertestimony subject to hearsay objection. Notso. In its opinion, the Court of Appeal foundthat the Petitioner confused a rule regarding an exception to the introduction of hearsay testimony at trial with the use of affidavits or declarations in a pretrial setting, such as an anti-SLAPP motion. Petitioner’s argument exalts form over substance and was appropriately given short shrift by the Court of Appeal. Petitioner has not made any substantive, credible argumentthat the individuals testifying underoath in the grand jury could or wouldnot likewisetestify to whatis 33 contained in the grand jury transcript treated as an affidavit.’ Thus these transcripts are admissible in opposition to this motion. G. The Grand Jury Transcripts Were Not Offered Or Admitted As Former Testimony. The substantive provisions of Evidence Codesections 1291 and 1292 allow former testimony to be admitted at trial as an exception to the rule against hearsay in three different types of situations. Evidence Code Section 1291 deals with former testimony of an unavailable witness when offered against the person who wasparty to the former proceeding. Evidence Code Section 1292(a) permits the introduction, in a civil action only, of former testimony of an unavailable witness given in a prioraction against a stranger to that prior action wherethe party to the action or proceeding in which the former testimony was given hadtheright and opportunity to cross-examine the declarant with an interest and motive similar to that which the party against whom thetestimonyis offered has at the hearing. These former testimony provisions are premised on the notion that the lack of opportunity to cross-examine the declarant in the second proceeding is not applicable because the present opponent is the party who offered the testimony in the former proceeding or because that party had the opportunity to cross-examine the declarant earlier with the sameor similar motive. The basis of the former testimony hearsay exception’s requirement of unavailability is premised on the fact that cross examination is a valuable ” As the Court of Appealnoted, Gilbane made no argument on appeal that the transcripts of the grand jury testimony were not what they purport to be, nor that the trial court erred in considering this evidence on the groundsthat it was not properly authenticated. The Court of Appeal noted Defendants appeared to accept that the documents used as exhibits during the grand jury testimony can be properly authenticated and therefore, excepted from the hearsay rule under Evidence Code Section 1271 by that testimony. See Sweetwater, supra, 246 Cal.App.4th at p. 38, fn. 21 and p. 41 fn. 24. 34 right and that the judge or jury should,ifpossible, “obtain the elusive and incommunicable evidence of witness deportment while testifying.” 1 Witkin, Cal. Evid. (June 2016 update) Hearsay, § 258 [citing Blachev. Blache (1951) 37 Cal.2d 531, 533]. Because the Legislature provides that anti-SLAPP motionsare to be decided using affidavits (which themselvesare not subject to cross- examination), the fundamental premise behindthe former testimony hearsay exception simply does not apply in this pretrial setting. At an anti- SLAPPhearing, the court does not weigh the credibility or comparative strength of evidence, thus the “elusive and incommunicable evidence of a witness’s deportment while testifying” is not a considerationat the anti- SLAPPhearing. In reaching its conclusionthatthe trial count properly considered the transcripts of the grand jury testimony of Amigable, Flores and Ortiz® and former Sweetwater representatives Wright, Leyba, Husson, Mercado, and Munoz, the Appellate Court found them to be materially indistinguishable from declarations, relying on Williams v. Saga Enterprises, Inc. (1990) 225 Cal.App.3d 142. In doing so, the Appellate Court examinedthe decision in Gatton v. A.P. Green Services, Inc. (1998) 64 Cal.App.4th 688, 694 which disagreed with the Williams’ court conclusionthat the testimony from the defendant employees’ criminal trial was admissible in opposition to a motion for summaryjudgement because “the effect of”the testimony of the witness was “the same as would be a declaration” supplied by the same witness. See Gatton, supra, 64 Cal.App.4th at p. 693-695; cf. Williams, supra, 225 Cal.App.3d at p. 149. ® The Appellate Court mistakenly referred to Ortiz as an employee of Sweetwater. He was a Program Managerfor SGI, a Joint Venturepartner; 4 AA 976 at p. 449:21-450:7. 35 Gatton involvedthe use of depositions offered in a summary judgement motion and discussed the Williams holding regarding the former testimony hearsay exception. The depositions from unrelated cases in Gatton were offered as “affidavits,” and in disagreeing with Williams, the Gatton court opinion makes referenceto the following statement in Williams: The court added a footnote: “Such testimony [from the underlying criminaltrial] could not be received in this case over hearsay objection on the groundthatit is admissible under the ‘formertestimony’ exception. Under Evidence Code Section 1292, subdivision (a), it is required that the declarant (ie., Mr. Nolan) be unavailable as a witness. No such showing is made here. However, inasmuchas the recorded testimony wasoffered in support of the opposition to a summaryjudgement motion andserveseffectively as a declaration by Mr. Nolan, we treat it here as such.” (Jbid., fn. 3.) Wecannot abide Williams’s disregard of the statute. Summaryjudgmentis based onall the evidenceset forth in the papers “except that which objections have been made and sustained.” (§ 437c, subd. (c)). The statute does also direct that “[e]videntiary objections not made at the hearingshall be deemed waived”(id., subd. (b)), and it would appear from the opinion that the restaurant’s lack of authority or argument may have constituted a waiverjustifying use ofthetrial transcript for motion purposes,or that failure to pursue the arguments with proper briefing on appeal wasalso a waiver. (Biljac Associatesv. First Interstate Bank, supra, 218 Cal.App.3d 1410, 1422.) But these were not the reasons given in Williams, and for Williamsto suggest that a proper objection would have been meritless simply guts the summaryjudgmentstatute and the Evidence Code. Nocase of which weare aware hasevercited Williams for that proposition. Gatton, supra, 64 Cal.App.4th at p. 694. This statement in Gatton is an unfortunate mischaracterization of Williams. What Williams wasreferring 36 to was if there wasan intent to offer earlier testimonyattrial, that testimony would need to meet the formertestimony exception,including a showing of the declarant’s unavailability. But this is not the same as testimonyoffered in an affidavit. All testimony in an affidavit would arguably be inadmissibleattrial. Accurately referenced, Williams states: “While the reporter’s transcriptis from anothercase, the effect of the examination made of Mr. Nolanis the same as would be a declaration supplied by him in this case.” Williams, supra, 225 Cal.App.3d at 149. Footnote 3 then states: Such testimony could not be received in this case over a hearsay objection on the groundthatit is admissible under the “formertestimony” exception. Under Evidence Codesection 1292, subdivision(a), it is required that the declarant(i.e., Mr. Nolan) be unavailable as a witness. No such showingis made here. However, inasmuchasthe recordedtestimony was offered in support of the opposition to summary judgment motion andserveseffectively as a declaration by Mr. Nolan, wetreat it here as such. Id. at 149,fn.3. Therefore, Williams simply acknowledgedthatifthe transcript of the testimony were offeredattrial in lieu of that witness’ actualtrial testimony, then it would have to meet the formertestimony exception, but because ofthe nature ofthe proceedings then present in Williams, it would suffice as an affidavit. That is correct. Evidence Code Section 1292 governsthe use ofprior testimony as substantive evidenceattrial, in place oflive testimony. Attrial, there is a need ofthe “unavailability” safeguard because the witness’ former testimonyreadto the jury is not subject to cross examinationat thattrial. Here, for purposes of supporting or opposing a pretrial anti-SLAPP motion, the witnesses’ demeanor and comportmentis notat issue, as the only 37 question for the court at this second prong is whether relevant and competent evidence supports the plaintiff's claims. As pointed out by the Sweetwater Court ofAppeal, the Gatton court took the summary judgmentstandard that an affidavit must show—that if sworn as a witness, the individual can testify competently to the evidentiary fact stated in the affidavit—and transmutedthat into a requirementthat the party provide someassurancesthat the witness would actually testify at trial in the case at issue. The Sweetwater Court of Appeal noted that Gatton stated “there are questions whether the witness, even if alive, can testify competently to the deposition’s contents,” and that “[iJn our record, wealso have only a representation by counsel that the witness [ ] was‘still alive,’ not that he was well enoughor willing to testify.” Sweetwater, supra 245 Cal.App.4th at p. 40 [citing Gatton, supra, 64 Cal.4th at p. 696]. 3 As wasnoted above,the affidavit/declaration standard for summary judgment motionsis higher than the standard for other motions. CCP §437c (d) requires “supporting and opposing affidavits or declarations shall be madeby a person on personal knowledgeshall set forth the admissible evidence, and show affirmatively that the affiant is competent to testify to the matters stated in the affidavits or declarations.” Thus, even these higher requirements for a witness declaration submitted on a summary judgment motion do not require either that the declarant state that he or she wouldsotestify at trial if called in this action or that the witness demonstrate his or her competency,but rather, the witness is required to provide proper foundationfor his/her testimony and demonstratethat the testimonyis based on the declarant’s own firsthand knowledgesuch that the witness could provide competenttestimony. Mr. Flores, the CEO of SGI, a Joint Venture partner, Mr. Amigable, the former Project Manager of Gilbane and Jaime Ortiz, a Joint Venture Program Manageralltestified at the grand jury. Petitioner has never 38 contended they were not competentbased onfirsthand knowledgetotestify as to the gifts they provided and, indeed they mostcertainly were. While the Court of Appeal in Sweetwater appears to have been the first California court to hold the contents of grand jury transcripts can be used as evidencein a pretrial motion, other courts have cometo this same conclusion. For example, in Arceo v. City ofJunction City, Kansas (2002) 182 F.Supp.2d 1062, 1080-1081, several defendants objected to the use of grand jury testimonyat the summary judgementstage, arguing that the use of such grand jury testimony was improperbecausetheparties did not have an opportunity to cross examine the witnesses. The Court in Arceo noted that the defendants are in the “same position they would have been had Arceofiled an affidavit” reflecting the same information which was signed by the witnesses. Jd. at p. 1080. Because the defendants would have not had the opportunity to cross-examineanaffiant, their inability to cross- examine the witnesses during the sworn grandjury testimonydid notresult in prejudice. Jd. That courts wouldallow the use of sworn criminal grand jury testimonyin a pre-trial motion setting should not be controversial. Afterall, the indices for the reliability of such testimonyare particularly high, given the very real consequencesoflyingto a grand jury. Lastly, the practical reality of this situation should not be overlooked. When an anti-SLAPP motionis filed, an immediate discovery stay goes into effect. As soon as Gilbanefiled its motion here, Sweetwater was faced with a situation in which personsalready represented by criminal lawyers whopled guilty to criminal offenses were unlikely to cooperate and sign declarations for Sweetwater’s anti-SLAPP opposition. In addition, the key grand jury witnesses were either current or former executives/employees of the defendants who were not going to provide Sweetwater with declarations it could use to defeat the current or former 39 employer’s anti-SLAPP motion, void the contracts, and obtain millions of dollars from the companies. Imposing an “unavailability” requirement under the circumstances and excluding the grandjury testimony would be to ignore facts that clearly exist, facts that witnesses could competently testify to, and fact which, if excluded, would indeed imposea barrier to the enforcementofcivil laws against public corruption. That cannot be the outcomehere. H. There Has Been A Prima Facie Showing That The Former Superintendent And Former Board Members Who Voted On The Contracts Were Corrupted By A Pervasive Pattern Of Lavish Gift-Giving By Defendants, Which Voids The Contracts At Issues Pursuant To The Express Terms And Purpose Of Government Code § 1090. Section 1090 confirmsthat the duties of public office demand absolute loyalty and undivided allegiance from the individual who holds that office. Thomson v. Call (1985) 38 Cal.3d 633, 648. In Lexin v. Superior Court (2010) 47 Cal.4th 1050, this Court explained the purpose of Section 1090: The commonlaw rule and section 1090 recognize “[t]he truism that a person cannot serve two masters simultaneously.”...“The evil to be thwarted by section 1090 is easily identified: If a public official is pulled in one direction by his financial interest and in anotherdirection by his official duties, his judgment cannot and should notbetrusted, even if he attempts impartiality.” Where public and private interests diverge, the full and fair representation of the public interest is jeopardized. Accordingly, section 1090 is concerned with ferreting out any financial conflicts of interest, other than remote or minimal ones, that might impair public officials from dischargingtheir fiduciary duties with undivided loyalty and allegiance to the public entities they are obligated to serve. Where a prohibited interest is found, the affected contract is void from its inception and the official who engagedin its making is subject to a host ofcivil and (if the violation was willful) criminal penalties, including imprisonment and disqualification from holding publicoffice in perpetuity. 40 Id. at 1073, citations omitted. Asstated in Lexin, Section 1090is interpreted liberally to prohibit any form of self-dealing, and the statute cannot be given a narrow and technical interpretation that would limit its scope and defeatthe legislative purpose. That the interest “might be small or indirect is immaterial so long as it deprives the [people] of his overriding fidelity to [them] and places him in the compromising situation where, in the exercise of his official judgmentor discretion, he may be influenced by personal considerations rather than the public good.” Lexin, supra, 47 Cal.4th at p. 1075. Properly understood, section 1090 standsas a prophylactic against the temptations that might corruptor influencepublic officials. Carson Redevelopment Agency v. Padilla (2006) 140 Cal.App.4th 1323, 1330; Thomson, supra, 38 Cal.3d at p. 648, 652. Section 1090 attempts to prevent honest government officials from succumbing to temptation by makingit illegal for them to enter into relationships which are fraught with temptation. “It follows from the goals of eliminating temptation, avoiding the appearance of impropriety, and insuring the city of the officers’ undivided and uncompromising allegiance that the violation of Section 1090 cannot turn on the question of whether actual fraud or dishonesty was involved. Noris any actualloss to the city or public agency necessary for a Section 1090 violation.” Carson Redevelopment Agency, supra, 140 Cal.App.4th at p. 1330. Courts have held that prohibited financialinterests are not limited to express agreements for benefits and in fact need not be established by direct evidence. Instead, such forbidden interests extend to the expectation of benefit arising from the express and implied agreementinferred from the 4] surrounding circumstances.” Thomson, supra, 38 Cal.3d at p. 645; People v. Deysher (1943) 2 Cal.2d 141, 149-150; Hub City Solid Waste Services, Inc. v. City ofCompton (2010) 186 Cal.App.4th 1114, 1127-1128. The evidence submitted in opposition to this anti-SLAPP motion— the plea forms detailing the guilty and no contest pleas by the various former Sweetwater officials and former and current employeesofthe defendants, as well as the grand jury testimony of individuals involved—is both circumstantial and direct evidence from which one can reasonably conclude the gifts and contributions were made in order to sway the Board members to vote favorable in awarding the contracts to Gilbane and the Joint Venture. The grand jury testimonyestablishes that the gifts were given before any discussions of the contracts began and when there was newlegislation that authorized new Proposition O funding for school construction at Sweetwater. The former superintendent recommendedthe removalof a “no contact” clause in the Request For the Proposals for the Proposition O program managementservices contract while both he and Board member Sandoval were being treatedto tickets to the San Diego Charger football games as well as an extravagant dinner thatcost $1,416.08. More expensive dinners for Board members and moretickets to athletic events occurred just before the former superintendent recommendedthat Gilbane and SGIbe provided the program management services for the Proposition O bond moneyoverthe prior program manager * Tn an apropos and tongue in cheek analogy, the Court in U.S. v. Blagojevich (7th Cir. 2015) 794 F.3d 729, 738 notes as follows: “Few politicians say, on oroff the record, ‘I will exchangeofficial act X for payment Y.’... ‘Nudge, nudge, wink, wink, you know what I mean’ can amountto extortion under the Hobbs Act, just as it can furnish the gist of a Monty Python sketch.”Jd. 42 whose work quality, according to Katy Wright, was very good while managing the Proposition BB projects. The staging of the contracts—with the approval of an interim program management agreement and program managementcontract to complete the proposition BB projects before the award ofthefirst permanent contract—coincided with even more elaborate dinners and theatre tickets. The first permanent contract was approved on January 28, 2008. Immediately preceding it and on New Year’s Eve weekend 2007, members of the Joint Venture treated superintendent Gandara and Board member Sandovalas wellas their families to a weekend in Pasadenato celebrate the Rose Bowl. SGI provided dinner at the Twin Palms Restaurant in Pasadena,hotel suites at the Los Angeles Biltmore Hotel, tickets to the Rose Bowl Parade, as well as nine Rose Bowltickets. Before a three paged amendment which expanded the program management contract to include “construction services” for which the Joint Venture ultimately received an additional seven million dollars, there were more dinners at expensive restaurants and discounted planetickets. The reward and payouts following the award ofthe contracts included trip for the former superintendent and his wife which includedplanetickets to northern California, three nights hotel accommodations, multiple wine tastings and a hotair balloonride that cost $245 per person. Seecitations to the evidenceatII B of the Answering Brief. As the Appellate Court below noted, It is not necessary for us to determine whethera plaintiff asserting a Section 1090 claim must demonstrate the existence of a quid pro quo arrangementin every instance, because we conclude that even if such a showingis required, Sweetwater presented evidence from which one could reasonably infer that a quid pro quo arrangementexisted, even if there is no direct evidence that the parties explicitly discussed such an arrangement. 43 The evidence ofthe plea forms detailing the guilty and no contest pleas by various former Sweetwater officials and former employees of defendants, as well as the grand jury testimony of a numberofthe individuals involved, is circumstantial evidence from which one could reasonably concludethat the gifts and contributions were madein order to sway the board membersto vote in favor of awarding contracts to Gilbane and the Joint Venture. Sweetwater, supra, 245 Cal.App.4th at 50. This court should confirm that Sweetwater has made a primafacie showing that the loyalty and allegiances of the former superintendent and former board members who voted on the contracts in their capacity as public officials was wrongfully corrupted whenthese individuals accepted the defendants’ lavish gifts, in violation of Gov’t Code § 1090. Vv. CONCLUSION Theprimafacie showingofthe facts sufficient to sustain a judgment in favor of Sweetwater is extensive. The actions of Petitionerillustrate how the intended targets of corruption, whose influence peddling resulted in criminal convictions, are attempting to use a statute intended to protect the exercise of First Amendment rights as a shield for their own misconduct. They use the cost and consequencesofthe anti-SLAPPstatute to intimidate and bludgeon while wrapping themselves in a perverse interpretation of the law. Indeed, Petitioner’s request that this Court look the other way and ignorecritical facts would turn the use ofthe anti-SLAPPstatute upside downprotecting a large governmentcontractorat the expense of the law abiding administrators, teachers, parents and school children of the 44 Sweetwater Union High SchoolDistrict, whoare the very real victims in this case. Respectfully submitted, Dated: October 20, 2016 SCHWARTZ SEMERDJIAN CAULEY & MOOT_LLP By: 45 Ahn S oo’ Johw’S. Moot, Esq. Satah Brite Evans, Esq. Ali . Adelman, Esq. Attorneys for Sweetwater Union High School District CERTIFICATE OF COMPLIANCE Pursuant to rule 8.504(d)(1) of the California Rules of Court, I hereby certify that this brief contains 13,188 words including footnotes in size 13 font Times New Roman. In making this certification, I have relied on the word count of the computer program by: chi Ste used to preparethe brief. 46 PROOF OF SERVICE Sweetwater Union High SchoolDistrict v. Gilbane Building Company, etal., IN THE SUPREME COURT OF CALIFORNIA Supreme Court Case No. 8233526 Court of Appeal, Fourth Appellate District, Division One Case No. D067383 San Diego Superior Court Case No. 37-2014-00025070-CU-MC-CTL I, Allison Haraguchi, declare as follows: I am employed in the City and County of San Diego, California. I am overthe age of 18 and nota party to the within action. Mybusiness addressis 101 W. Broadway, Suite 310, San Diego, California 92101. On October 20, 2016, I served the foregoing document(s) described belowas: ANSWERINGBRIEF ON THE MERITS [_x_] (BY MAIL)Byplacing the envelope for collection and mailing following our ordinary business practices. I am readily familiar with this business’s practice for collecting and processing correspondence for mailing. On the same day that correspondenceis place for collection and mailing, it is deposited in the ordinary course of business with the United States Postal Service in a sealed envelope with postage fully prepaid. I declare under penalty of perjury under the lawsof the State of California that the aboveis true and correct. Executed on October 20, 2016, at San Diego, California. Uefantepb- ~ Y Allison Haraguchi 47 SERVICE LIST Charles A. Bird, Esq. Christian D. Humphreys, Esq. DENTONS US LLP 4655 Executive Drive, Suite 700 San Diego, CA 92121 Charles.bird@dentons.com Chris.huphreys@dentons.com Attorneys for Gilbane Building Company and Gilbane/SGIJoint Venture San Diego Superior Court Central Division Hon. Eddie C. Sturgeon Dept. 67 330 West Broadway San Diego, CA 92101 Court of Appeal Fourth District Division One 750 B Street, Suite 300 San Diego, CA 92101 James A. ArdaizBAKER MANOCK & JENSEN, PC5260 North Palm, Suite 421Fresno, CA 93704jardaiz@bakermanock.com Attorneys for SweetwaterUnion High SchoolDistrict 48
