Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-3_15-cv-00584/USCOURTS-cand-3_15-cv-00584-0/pdf.json

Nature of Suit Code: 190
Nature of Suit: Other Contract Actions
Cause of Action: 28:1332 Diversity-Contract Dispute

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United States District Court

Northern District of California

UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF CALIFORNIA

STEVEN AMES BROWN, et al.,

Plaintiffs,

v.

VERSE MUSIC GROUP LLC,

Defendant.

Case No. 15-cv-00584-VC 

ORDER GRANTING IN PART AND 

DENYING IN PART THE MOTION TO 

DISMISS AND SPECIAL MOTION TO 

STRIKE

Re: Dkt. No. 25

1. The motion to dismiss the counterclaim for breach of contract is denied. The contract 

between the parties states that "[n]o party shall be deemed to be in breach of any obligation 

hereunder unless such party fails to cure the default within thirty days of written notice thereof." 

The cross-complaint alleges that Brown intentionally avoided notifying Verse of its alleged 

default before suing Verse, because Brown did not want Verse to have a chance to cure the 

default. This allegation is plausible, and specific enough to put Brown on notice of the nature of 

the counterclaim.

2. The special motion to strike the breach of contract counterclaim under California's antiSLAPP statute is denied. Arguably, this counterclaim does not arise from an act in furtherance of 

Brown's free speech rights. Although Brown characterizes the counterclaim as being based on the 

lawsuit he filed, it's probably better understood as being based on Brown's decision not to give 

Verse notice of the default before filing the lawsuit. See, e.g., ¶ 8. But even construing the 

counterclaim as Brown urges, that is, based on the lawsuit itself (in which case it would certainly 

be the type of protected activity contemplated by the anti-SLAPP statute), the evidence submitted 

by the parties to date indicates there is at least some probability that Verse will prevail on this 

counterclaim. There is at least some probability that the above-quoted contract language was 

Case 3:15-cv-00584-VC Document 36 Filed 06/26/15 Page 1 of 3
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United States District Court

Northern District of California

intended to preclude Brown from hauling Verse into court before giving Verse notice of the 

default and an opportunity to cure it. In other words, even if Brown succeeds at the first step of 

the anti-SLAPP inquiry (which seems unlikely), he fails at the second, because there is some 

probability that Verse could prevail on this counterclaim. See Vess v. Ciba-Geigy Corp. USA, 317 

F.3d 1097, 1110 (9th Cir. 2003) ("If the court determines that the plaintiff has established that 

there is a probability that the plaintiff will prevail on the claim, the motion to strike must be 

denied."). 

3. The motion to dismiss the second counterclaim, which is for intentional interference 

with contract, is granted. Verse does not even try in its cross-complaint to allege facts to support 

all the elements of a claim for intentional interference with contract. See Bank of New York v. 

Fremont Gen. Corp., 532 F.3d 902, 909 (9th Cir. 2008) (describing elements of an intentional 

interference with contract claim).

4. The special motion to strike the second counterclaim under the anti-SLAPP statute is 

granted. This counterclaim implicates protected conduct, because it attacks communications 

Brown made to third parties about his lawsuit – parties whose rights were potentially affected by 

his lawsuit. See Cal. Civ. Proc. Code § 425.16(e) (protected activity includes "any 

written...statement...made in connection with an issue under consideration or review by 

a...judicial body"). On the second step of the anti-SLAPP inquiry, theoretically Verse could have 

responded to the special motion to strike with evidence to demonstrate some probability of 

success, thereby overcoming the special motion to strike even if the counterclaim originally failed 

to plead intentional interference with sufficient particularity. But Verse has presented no such 

evidence here, so it loses at both steps of the inquiry.

5. Even though the Court has granted the special motion to strike the second counterclaim, 

Verse has leave to amend this counterclaim (subject of course to a renewed anti-SLAPP motion), 

for the reasons explained by Judge Tigar in Choyce v. SF Bay Area Independent Media Center, 

2013 WL 6234628 *11 (N.D. Cal.). Any amended counterclaim must be filed within 14 days of 

the date of this order. Because Brown succeeded on half his special motion to strike, he is entitled

to recover half the fees and costs incurred in pursuing the motion. See id. at *10. 

Case 3:15-cv-00584-VC Document 36 Filed 06/26/15 Page 2 of 3
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United States District Court

Northern District of California

IT IS SO ORDERED.

Dated: June 26, 2015

______________________________________

 VINCE CHHABRIA

 United States District Judge

Case 3:15-cv-00584-VC Document 36 Filed 06/26/15 Page 3 of 3