Oakland, CA (Originally published, Oct. 22, 2014) As a civil litigator, I sometimes field phone calls from people who, after being threatened with litigation, ask, “Why can’t I sue first?” This “the best defense is a good offense” approach to litigation sometimes works and sometimes, well not so much. A recent California Court of Appeal case highlights a downside of filing a lawsuit to preempt some consumer lawsuits.
Lunada Biomedical v. Lunez, B243205 (Oct. 9, 2014) shows one pitfall can be the dismissal under California’s storied anti-SLAPP statute. The anti-SLAPP statute, found in Code of Civil Procedure section 425.16 allows any defendant to move to strike a complaint that both arises from protected activity and lacks minimal merit. The statute can be a game-changer; if the trial court strikes the complaint, the case ends and the defendants walks away with an award of attorney’s fees.
In Lunada, a dietary supplement company brought suit after a consumer served it with a pre-lawsuit notice under the Consumer Legal Remedies Act, Civil Code section 1750, et seq. (the “CLRA”). Such notices are required to obtain damages under the CLRA. The notice asserted the company engaged in deceptive advertising of a dietary supplement. The defendant company then filed a single-count declaratory relief claim seeking a declaration that the company’s advertising was legal and that the consumer’s CLRA notice lacked basis.
After the trial court granted the consumer’s Special Motion to Strike, the Second District affirmed. It reasoned as a preliminary matter that the supplement company’s lawsuit arose from the protected activity of serving the target with the CLRA notice.
It then held that the declaratory relief claim lacked merit. In doing so it relied on Filarsky v. Superior Court, 28 Cal.4th 419 (2002), a California Supreme Court case decided under the California Public Records Act (CPRA). There, the Supreme Court barred public entities from filing declaratory relief claims to fend off CPRA actions. The Court held that doing so would undermine the public’s rights under the CPRA that are not available in declaratory relief claims, including expedited hearings, attorney’s fees, and an obligation on the part of the agency to take a writ from any trial court order compelling disclosure. Extending Filarsky’s rationale to actions under the CLRA, the Second District reasoned that “Plaintiff’s declaratory relief action here eliminates an important incentive afforded by the CLRA, mandatory attorneys fees, and would thwart the CLRA’s purpose.” Because it determined that declaratory relief was not available as a matter of law to fend off a CLRA lawsuit, the Second District ruled that the plaintiff had no chance of prevailing.
All of this goes to show that a good defense does not always include an aggressive offense.
John Claassen practices civil litigation from the offices of Claassen, P.C. in Oakland, California. For more information about the firm, please click here. While this blog entry is published for informational purposes, portions of this blog post may constitute "communications" within the meaning of California Rule of Professional Conduct 1-400. Thus, as a possible "Advertisement" it is not intended to constitute legal advice. Similarly, no statement made in this blog post is intended as a guarantee, warranty, or promise about the outcome of any litigation matter taken on by the firm. This Advertisement is not intended for any matter that would require the rendition of legal services outside of the State of California or under the laws of any jurisdiction outside of the State of California. Copyright 2014-15. All rights reserved.