Sometimes, lawsuits involve allegations of embarrassing or even illegal conduct. And a prelitigation letter that references that conduct might be considered extortion. The trial court thought an attorney letter was extortion in *********************Flickinger v. Finwall (D2d8 Nov. 30, 2022) 85 Cal.App.5th 822. But the Court of Appeal disagreed, and published its opinion saying so.
The unsavory allegations were between a homeowner and his contractor. The owner, in a drunken conversation with the contractor, confessed he’d taken money illegally as kickbacks during his overseas trips for his employer, Apple. The contractor eventually quit his job, allegedly based on trepidation of taking ill-gotten money.
When the homeowner demanded payment, the contractor’s attorney responded with a matter-of-fact statement that litigation “[could] result in Apple opening an investigation into [plaintiff's] relationships with vendors.”
The owner sued for extortion, and the contractor’s attorney filed an anti-SLAPP motion, arguing his letter was protected conduct. But the trial court held that the letter was extortion.
The Court of Appeal disagreed. The circumstances here did not fit into the egregious facts of Flatley v. Mauro (2006) 39 Cal.4th 299. Instead, the statement was a permissible threat under Malin v. Singer (2013) 217 Cal.App.4th 1283, which recognized that certain threats to disclose information in litigation do not amount to extortion as a matter of law. (Id. at pp. 1298–1299.)
Of significance, the letter was sent to the owner’s attorney—not to the attorney directly. And the letter was responding to the owner’s demand letter—it was not a threat out of the blue. And the letter defended the contractor on the merits—rather than merely stand on the force of the threat. And the statement that litigation may bring the kickbacks issue to light was not a threat to report to prosecution, but merely a matter-of-fact observation.
The court went on to find that the plaintiff failed on the second prong of the anti-SLAPP analysis to show a likelihood of prevailing on the merits.
So the order denying the defendant’s anti-SLAPP motion was reversed with directions to grant the motion. And the defendant will recover his attorney fees for both his motion and the appeal.
Tim Kowal is an appellate specialist certified by the California State Bar Board of Legal Specialization. Tim helps trial attorneys and clients win their cases and avoid error on appeal. He co-hosts the Cal. Appellate Law Podcast at www.CALPodcast.com, and publishes summaries of cases and appellate tips for trial attorneys at www.tvalaw.com/articles. Contact Tim at firstname.lastname@example.org or (714) 641-1232.
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