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Filed 8/23/21 Safe Credit Union v. Diaz CA3

NOT TO BE PUBLISHED

California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for 

publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication 

or ordered published for purposes of rule 8.1115.

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

THIRD APPELLATE DISTRICT

(San Joaquin)

----

SAFE CREDIT UNION,

Plaintiff, Cross-defendant and 

Appellant,

v.

JULIET M. DIAZ,

Defendant, Cross-complainant and 

Respondent.

C092158

(Super. Ct. No. 

STKCVUOC201813550)

Plaintiff and cross-defendant SAFE Credit Union (SAFE) sued defendant and 

cross-complainant Juliet M. Diaz for an outstanding balance owed by her on a car loan 

after SAFE repossessed and auctioned the car subject to the loan. Diaz cross complained 

alleging she and other members of a putative class were victims of SAFE’s unfair debt 

collection practices. Generally, Diaz alleged SAFE issued legally inadequate notices of 

its intent to sell repossessed vehicles. Because of the legally inadequate notices, SAFE 
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was precluded from seeking outstanding balances on the loans from her and members of 

the putative class, yet attempted to do so through multiple means including litigation. 

Diaz alleged SAFE violated the Rees-Levering Automobile Sales Finance Act (ReesLevering Act) (Civ. Code, § 2981 et seq.), the Rosenthal Fair Debt Collection Practice 

Act (Rosenthal Act) (Civ. Code, § 1788 et seq.), and the unfair competition law (Bus. & 

Prof. Code, § 17200 et seq.). SAFE filed a special motion to strike pursuant to Code of 

Civil Procedure1section 425.16 to strike from Diaz’s cross-complaint the allegations, to 

which it refers as “Litigation Claims,” pertaining to SAFE’s litigation. The trial court 

denied SAFE’s motion. We affirm.

FACTUAL AND PROCEDURAL BACKGROUND

Diaz filed a class action cross-complaint against SAFE in SAFE’s suit seeking 

from her the outstanding balance on a car loan after SAFE’s repossession and sale of the 

car subject to the loan. On behalf of herself and others similarly situated, Diaz sought

damages, injunctive relief, and restitution under the Rees-Levering Act, the Rosenthal 

Act, and the unfair competition law. 

Specifically, Diaz alleged she brought the suit “to challenge the unlawful, unfair 

and deceptive practices of [SAFE] following repossession of [her] and the putative 

class’s motor vehicles under a conditional sales contract. [¶] . . . In particular[,] [SAFE] 

failed to provide [Diaz] and the class with statutorily-mandated notices of their legal 

rights and obligations after repossession of their motor vehicles . . . [¶] . . . [SAFE] 

wrongfully deprived [Diaz] and the putative class of their right to reinstate or redeem 

their conditional sales contract after repossession, negligently and/or fraudulently 

misrepresented the rights and obligations of the parties following repossession, collected, 

or sought to collect, a deficiency from [Diaz] and the putative class following 

1 Further references are to the Code of Civil Procedure unless indicated otherwise.
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repossession for which [Diaz] and the putative class are not liable as a matter of law. [¶] 

. . . [SAFE]’s statutory post-repossession notice (‘Statutory Notice’) is a form document. 

[SAFE] sent the Statutory Notice to numerous members of the putative class. [SAFE] is 

not entitled to collect on any alleged deficiency balances from members of the putative 

class who received such Statutory Notice, and [Diaz] is seeking to enjoin these 

collections activities . . . .” 

Diaz alleged a written notice was mailed to her “that stated that her vehicle had 

been repossessed and would be sold unless she reinstated her contract or redeemed the 

vehicle . . . [¶] . . . [SAFE] refused to grant [Diaz] her statutory rights as set forth in the 

notice, and required her to perform additional undisclosed actions as conditions precedent 

to reinstatement. In addition, [Diaz]’s Statutory Notice did not contain several of the 

disclosures mandated by [the Rees-Levering Act].” 

Diaz alleged three causes of action: First, violation of the Rees-Levering Act 

under the theory the statutory notice SAFE sent pursuant to Civil Code section 2983.2, 

subdivision (a) did not contain the mandated disclosures and information required by that 

section. As a consequence, Diaz could not be held liable for the balance of the loan, yet 

SAFE continued to attempt to collect the outstanding balance from her. Second, 

violation of the Rosenthal Act under the theory SAFE attempted to collect a nonexistent 

outstanding balance by making false representations that Diaz owed a debt, demanding 

payment, and suing her. Third, violation of the unfair competition law based on eight

specifically alleged business practices Diaz argued were unlawful, fraudulent, and 

contrary to public policy. One such alleged business practice was the filing of “collection 

suits against [her] and the class [that did not] comply with Civil Code § 2983.8(b) by 

failing to file an affidavit of compliance with the Rees-Levering Act.” 

SAFE filed a special motion to strike several allegations, i.e., the Litigation 

Claims, “and each cause of action to the extent based on them” from Diaz’s crosscomplaint. SAFE argued that each of Diaz’s causes of action relied in part on these 
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Litigation Claims involving SAFE’s exercise of protected activity, thus the burden must 

shift to Diaz to demonstrate she could prevail on her claims. 

The trial court denied SAFE’s special motion to strike reasoning that “each of

Ms. Diaz’s causes of action in the cross-complaint is dependent upon the allegation that 

[SAFE] violated provisions of the Rees-Levering Automobile Sales Finance Act,” which 

“is not an activity that constitutes protected speech or petitioning.” 

SAFE appeals. 

DISCUSSION

I

Legal Background

“ ‘A SLAPP[2]is a civil lawsuit that is aimed at preventing citizens from 

exercising their political rights or punishing those who have done so. “ ‘While SLAPP 

suits masquerade as ordinary lawsuits such as defamation and interference with 

prospective economic advantage, they are generally meritless suits brought primarily to 

chill the exercise of free speech or petition rights by the threat of severe economic 

sanctions against the defendant, and not to vindicate a legally cognizable right.’ ” ’ ” 

(Sheley v. Harrop (2017) 9 Cal.App.5th 1147, 1160-1161, quoting Simpson Strong-Tie 

Co., Inc. v. Gore (2010) 49 Cal.4th 12, 21.)

“ ‘In 1992, out of concern over “a disturbing increase” in these types of lawsuits, 

the Legislature enacted section 425.16, the anti-SLAPP statute. [Citation.] The statute 

authorized the filing of a special motion to strike to expedite the early dismissal of these 

unmeritorious claims. [Citation.] To encourage “continued participation in matters of 

public significance” and to ensure “that this participation should not be chilled through 

abuse of the judicial process,” the Legislature expressly provided that the anti-SLAPP 

2 Strategic lawsuit against public participation. (See Wilson v. Cable News 

Network, Inc. (2019) 7 Cal.5th 871, 882, fn. 2.) 
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statute “shall be construed broadly.” ’ ” (Sheley v. Harrop, supra, 9 Cal.App.5th at 

p. 1161, quoting Simpson Strong-Tie Co., Inc. v. Gore, supra, 49 Cal.4th at p. 21.)

“The anti-SLAPP statute ‘provides a procedure for weeding out, at an early stage, 

meritless claims arising from protected activity.’ ” (Sheley v. Harrop, supra, 9 

Cal.App.5th at p. 1161, quoting Baral v. Schnitt (2016) 1 Cal.5th 376, 384.) “The statute 

applies to ‘cause[s] of action against a person arising from any act of that person in 

furtherance of the person’s right of petition or free speech under the United States 

Constitution or the California Constitution in connection with a public issue.’ ” (Sheley, 

at p. 1161, quoting § 425.16, subd. (b)(1).) “As used in the statutory scheme, ‘ “act in 

furtherance of a person’s right of petition or free speech under the United States or 

California Constitution in connection with a public issue” includes: (1) any written or 

oral statement or writing made before a legislative, executive, or judicial proceeding, or 

any other official proceeding authorized by law, (2) any written or oral statement or 

writing made in connection with an issue under consideration or review by a legislative, 

executive, or judicial body, or any other official proceeding authorized by law, (3) any 

written or oral statement or writing made in a place open to the public or a public forum 

in connection with an issue of public interest, or (4) any other conduct in furtherance of 

the exercise of the constitutional right of petition or the constitutional right of free speech 

in connection with a public issue or an issue of public interest.’ ” (Sheley, at p. 1161, 

quoting § 425.16, subd. (e).)

“A special motion to strike involves a two-step process.” (Sheley v. Harrop, 

supra, 9 Cal.App.5th at p. 1161, citing Baral v. Schnitt, supra, 1 Cal.5th at p. 384.) 

“ ‘[I]f the defendant does not meet its burden on the first step, the court should deny the 

motion and need not address the second step.’ ” (Sheley, at p. 1162.) On appeal, we 

review de novo whether SAFE met its initial burden of showing the claim arises out of 

protected activity. (Ibid.)
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II

SAFE Has Not Demonstrated How The 

Litigation Claims Give Rise To A Claim For Relief

For complaints and cross-complaints alleging mixed causes of action arising from 

both protected and unprotected activity, “[a]t the first step, the moving defendant bears 

the burden of identifying all allegations of protected activity, and the claims for relief 

supported by them. When relief is sought based on allegations of both protected and 

unprotected activity, the unprotected activity is disregarded at this stage. If the court 

determines that relief is sought based on allegations arising from activity protected by the 

statute, the second step is reached.” (Baral v. Schnitt, supra, 1 Cal.5th at p. 396, italics 

added.)

“The scope of the term ‘cause of action’ in section 425.16(b)(1) is evident from its 

statutory context. When the Legislature declared that a ‘cause of action’ arising from 

activity furthering the rights of petition or free speech may be stricken unless the plaintiff 

establishes a probability of prevailing, it had in mind allegations of protected activity that 

are asserted as grounds for relief. The targeted claim must amount to a ‘cause of action’ 

in the sense that it is alleged to justify a remedy. By referring to a ‘cause of action 

against a person arising from any act of that person in furtherance of’ the protected rights 

of petition and speech, the Legislature indicated that particular alleged acts giving rise to 

a claim for relief may be the object of an anti-SLAPP motion. (§ 425.16(b)(1), italics 

added.) . . . Thus, in cases involving allegations of both protected and unprotected

activity, the plaintiff is required to establish a probability of prevailing on any claim for 

relief based on allegations of protected activity.” (Baral v. Schnitt, supra, 1 Cal. 5th at 

p. 395.)

SAFE contends the trial court should have reached the second stage of the analysis 

because the Litigation Claims, which were multiple allegations throughout the crosscomplaint in which Diaz mentioned or alluded to the lawsuit SAFE filed against her, 
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arose from protected activity. We disagree. An allegation is not stricken simply because 

it involves protected activity. A special motion to strike under section 425.16 is utilized 

to strike distinctive claims for relief arising out of protected activity, and the allegations

of protected activity supporting those claims. (Baral v. Schnitt, supra, 1 Cal.5th at 

pp. 393-395.) At the trial court, and again on appeal, SAFE does not identify claims for 

relief supported by the Litigation Claims beyond simply pointing to Diaz’s allusion to the 

protected activity. This is not sufficient to meet its burden. 

“Typically, a pleaded cause of action states a legal ground for recovery supported 

by specific allegations of conduct by the defendant on which the plaintiff relies to 

establish a right to relief. If the supporting allegations include conduct furthering the 

defendant’s exercise of the constitutional rights of free speech or petition, the pleaded 

cause of action ‘aris[es] from’ protected activity, at least in part, and is subject to the 

special motion to strike authorized by section 425.16(b)(1).” (Baral v. Schnitt, supra, 1 

Cal.5th at pp. 381-382.) But, “[a]ssertions that are ‘merely incidental’ or ‘collateral’ are 

not subject to section 425.16.” (Id. at p. 394.) Thus, “[a]llegations of protected activity 

that merely provide context, without supporting a claim for recovery, cannot be stricken 

under the anti-SLAPP statute.” (Ibid.)

Indeed, as our Supreme Court’s recent decision in Bonni demonstrates the antiSLAPP analysis begins with consideration of the elements of each claim, the actions 

alleged to establish those elements, and whether those actions are protected. (Bonni v. St. 

Joseph Health System (2021) 11 Cal.5th 995.) SAFE did not engage in this 

consideration, which it was required to do to meet its burden. (Id. at p. 1010, citing Baral 

v. Schnitt, supra, 1 Cal.5th at p. 396.) Nowhere in the trial court, nor on appeal, does 

SAFE identify the elements of Diaz’s claims for recovery and how the actions alleged in 

her cross-complaint establish those elements. 

SAFE has consistently listed several paragraphs from Diaz’s cross-complaint and 

asserted those paragraphs “and each cause of action to the extent based on them” must be 
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stricken because they involve protected activity. Accordingly, SAFE has failed to carry 

its burden at the first step of our analysis to identify claims for recovery, not just 

allegations, arising out of protected activity. 

DISPOSITION

The order is affirmed. SAFE shall pay Diaz’s costs on appeal. (Cal. Rules of 

Court, rule 8.278(a)(1)-(2).) 

/s/ 

Robie, J.

We concur:

/s/ 

Raye, P. J.

/s/ 

Duarte, J.