Filed 9/25/24 AWI Builders v. Payne CA2/4

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IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

SECOND APPELLATE DISTRICT

DIVISION FOUR

AWI BUILDERS, INC. et al.,

Plaintiffs and Respondents,

v.

HAROLD T. PAYNE, as Successor in 

Interest, etc.,

Defendant and Appellant.

 B322626

 (Los Angeles County

 Super. Ct. No. BC696666)

APPEAL from an order of the Superior Court of 

Los Angeles County, Robert Broadbelt, Judge. Reversed with 

instructions.

Rob Bonta, Attorney General, Jodi L. Cleesattle, Assistant 

Attorney General, Pamela J. Holmes, Donna M. Dean and 

Shirley R. Sullinger, Attorneys General for Defendant and 

Appellant.

Pacheco & Neach, Rod Pacheco; Feldman & Associates and 

Mark Feldman for Plaintiffs and Respondents.
2

Plaintiffs AWI Builders, Inc., and its principals, Zhirayr 

“Robert” Mekikyan and Anna Mekikyan, sued numerous entities 

and individuals involved with a state Division of Labor Standards 

Enforcement (DLSE) investigation of their business practices. 

Plaintiffs’ third amended complaint included a federal civil rights 

claim under 42 U.S.C. section 1983 (section 1983) alleging that 

defendant Susan Nakagama, a DLSE employee, violated their 

due process rights in both her official and individual capacities by 

participating in a conspiracy to unlawfully investigate plaintiffs 

and withholding and instructing a subordinate DLSE employee

to withhold documents from plaintiffs during the investigation. 

Nakagama moved to strike the section 1983 cause of action under 

the anti-SLAPP statute, Code of Civil Procedure section 425.16.1

The trial court granted the motion as to the official capacity 

claim but denied it as to the individual capacity claim. Although 

it found that Nakagama met her first-step burden of showing 

that the individual capacity cause of action arose from protected 

activity (§ 425.16, subd. (e)(2)), it also found that plaintiffs 

carried their second-step burden of showing a probability of 

prevailing on the merits. The trial court rejected Nakagama’s 

assertions of absolute prosecutorial immunity, qualified 

immunity, and litigation privilege under Civil Code section 47, 

subdivision (b) (section 47). 

Nakagama died during the pendency of this appeal. Her 

successor in interest and personal representative, Harold T. 

Payne, now contends that the trial court should have granted the 

1 “SLAPP” stands for “strategic lawsuits against public 

participation.” (FilmOn.com Inc. v. DoubleVerify Inc. (2019) 7 

Cal.5th 133, 139.) All further undesignated statutory references 

are to the Code of Civil Procedure.
3

anti-SLAPP motion in full. In addition to asserting the immunity 

and privilege arguments raised below, he contends that plaintiffs 

failed to meet their burden of showing a probability of prevailing 

on the merits. Plaintiffs respond that Nakagama failed to carry 

her burden at the first step below. They further contend that 

even if the matter is subject to the anti-SLAPP statute, the trial 

court properly rejected Nakagama’s assertions of privilege and 

immunity, and we should not address Payne’s new argument

regarding the merits of the claim.

We reverse. The trial court correctly found the cause of 

action subject to the anti-SLAPP statute. However, its analysis 

at the second step of the anti-SLAPP inquiry was inadequate, as 

was plaintiffs’ showing. We exercise our discretion to consider 

Payne’s belatedly raised legal argument regarding plaintiffs’ 

likelihood of prevailing on the merits, which is persuasive in light 

of plaintiffs’ failure to plead or demonstrate the lack of adequate 

state remedies for the alleged due process violation. We need not 

and do not address the arguments regarding privilege and 

immunity. 

FACTUAL BACKGROUND

Plaintiffs allege the following in the operative third 

amended complaint. 

Between 2011 and 2013, after a public and competitive bid 

process, Riverside County awarded plaintiffs three public works 

contracts: the $16.9 million “Mead Valley Project,” the $14 

million “Public Defender Project,” and the $13.5 million “Medical 

Center Project.” Plaintiffs were also awarded a $10.5 million 

contract in Orange County, the “OC Fair Project,” in 2013. 

In mid-to-late 2013, plaintiffs discovered significant 

structural problems with the building in the Public Defender 
4

Project that were unknown at the time of the bid. The change 

orders necessary to account for the issues “became significant 

points of contention between AWI and Riverside County.” 

Riverside County subsequently terminated AWI’s contract on the 

Public Defender Project and awarded the project to a different 

construction company, increasing the amount of the contract from 

$14 million to $32 million. In late 2013, after “pointed 

communications” with Riverside County, AWI obtained counsel 

and “identified the possibility of a lawsuit and government claims 

regarding the county’s refusal to pay AWI for work it had 

performed under the contract awarded.” 

Plaintiffs allege that refusal to pay contractors was “a 

pattern and practice for Riverside County.” They further allege 

that Riverside County also had a pattern of “harass[ing] 

contractors who were possible litigants with a host of crushing 

abuses, directed at drying up all sources of revenue by 

withholding payments, using a labor compliance firm to generate 

specious complaints to the [DLSE], which would then levy 

exponential fines against the contentious contractor, and finally 

to falsely generate criminal investigations which would either put 

the company out of business and or [sic] put the owners in 

prison.” 

Pursuant to this alleged “playbook,” in the “early months of 

2014” Riverside County, through “straw man” company GKK 

Works, hired a private labor consulting firm, Alliant Consulting, 

and Alliant’s president, Christa Schott, to start a specious 

investigation into plaintiffs. Although GKK Works hired Alliant 

and Schott, Schott “took her orders from only two entities, 

Riverside County Administration officials and the Orange County 

District Attorney’s Office (OCDA), and had little or no contact 
5

with GKK.” By June 2014, despite having uncovered no evidence 

of wrongdoing by plaintiffs, Schott “succeeded in convincing 

DLSE . . . to open an investigation” into plaintiffs. Schott worked 

closely with a DLSE employee, Maria Sandoval, and provided 

Sandoval with “fabricated” “investigative materials.” Sandoval 

“spearheaded” DLSE’s investigation, “which was overseen by 

Nakagama, and spurred on by Schott.” At Schott’s “constant and 

aggressive insistence throughout 2014 and 2015,” DLSE filed 

“various labor code administrative claims” against plaintiffs in 

2015. The DLSE claims enabled Riverside County “to withhold 

payments of over millions of dollars [sic] in monies owed to AWI.” 

While the DLSE was investigating, plaintiffs “sought to 

defend themselves” and also continued their efforts to obtain 

payment from Riverside County on the various projects, filing 

government claims and eventually suing Riverside County in 

2015. In 2014, plaintiffs, through their counsel, “made requests 

for documents from DLSE” to defend against the administrative 

claims levied against them. Sandoval contacted Schott, who in 

turn contacted the Riverside and Orange County district 

attorneys’ offices. Schott “made every attempt to convince 

Sandoval not to turn over documents Schott had created or given 

to Sandoval, in an effort to hide her unlawful involvement.” 

Sandoval “consulted with her supervisor Nakagama, who also 

instructed Sandoval not to turn over documents.” During the 

deposition in which Sandoval testified to receiving this 

instruction, which occurred “in a related civil case in Orange 

County,” Sandoval also stated that Nakagama told her “that the 

instruction to conceal documents was a directive that came 

directly from” the OCDA and an attorney there. Plaintiffs allege 

that Riverside County and OCDA personnel “convinced” 
6

Nakagama and Sandoval to “also withhold numerous documents” 

plaintiffs requested in 2014 and 2015, “in violation of due process 

protections afforded the accused in administrative hearings.” In 

her own deposition in the related case, Nakagama “admitted” 

that concealing documents from the subject of an administrative 

investigation “was not only a violation of DLSE regulations, but 

also of due process rights.” Plaintiffs were unaware of the 

concealment until “civil discovery in related litigation against 

Riverside County.” 

Meanwhile, Alliant and Schott concurrently “stepped up 

the pressure on AWI” and “badgered” Riverside County’s district 

attorney’s office to initiate criminal prosecutions against AWI. 

Alliant and Schott similarly “badgered” Orange County to 

investigate and prosecute plaintiffs. Orange County initiated an 

investigation into plaintiffs in 2015. In 2015, Schott visited 

plaintiffs’ business offices without a warrant, broke into locked 

filing cabinets, and photocopied documents contained therein. 

On a separate occasion in 2015, Schott met with Tony Hawk, a 

“high-ranking job superintendent for AWI on one of the Riverside 

projects,” and paid him to provide her with plaintiffs’ confidential 

records that later served as the basis for multiple search 

warrants executed by OCDA and Riverside County in October 

2015. 

Many “business documents, an extensive amount of 

computer equipment, thumb drives, external hard drives, an 

iPhone and a credit card were seized” in connection with the 

search warrants. The loss of these records “caused havoc” for 

plaintiffs during their efforts to refute the DLSE’s allegations of 

Labor Code violations and seek redress against Riverside County 

because they had no access to their electronic or written records. 
7

After plaintiffs filed a successful motion to compel in a case 

against Riverside County, a forensic examination of Alliant’s and 

Schott’s computers “revealed well over 80,000 pages of 

documents” that had been concealed. Riverside County 

ultimately settled all plaintiffs’ claims against it for $4.5 million. 

Neither OCDA nor Riverside County filed a criminal 

complaint against plaintiffs. However, the DLSE issued several 

civil wage and penalty assessments against plaintiffs, including 

an “over $500,000” assessment related to the Public Defender 

Project, and assessments totaling approximately $460,000 related 

to the OC Fair Project. 

OCDA also filed a civil case against plaintiffs in February 

2018. The deposition testimony from Sandoval and Nakagama 

discussed above was elicited in that action. 

PROCEDURAL HISTORY

Plaintiffs filed their initial complaint on March 6, 2018, a 

first amended complaint on March 29, 2018, and a second 

amended complaint on April 20, 2018. The second amended 

complaint asserted causes of action for violation of civil rights 

pursuant to section 1983; a Monell2 claim under section 1983; 

negligent interference with contractual relations; negligent 

interference with prospective economic opportunity; intentional 

interference with contractual relations; intentional interference 

with prospective economic opportunity; and negligent 

supervision. Nakagama was not named as a defendant. 

Numerous defendants filed anti-SLAPP motions to strike 

the second amended complaint, and some filed demurrers. The 

trial court largely granted the anti-SLAPP motions, including 

2 Monell v. Department of Social Services (1978) 436 U.S. 658 

(Monell).
8

those filed by Alliant and Schott, GKK Works, various Orange 

County defendants, the State of California, and Sandoval. (See 

AWI Builders, Inc. v. Alliant Consulting (Oct. 22, 2021, B294662, 

B297189, B298699, B300834) [nonpub. opn.].) Notably, it denied 

Sandoval’s motion to strike in part, as to the section 1983 cause 

of action in her individual capacity, and also overruled her 

demurrer to that cause of action. Plaintiffs appealed the court’s 

orders; no defendant cross-appealed. The appeals were 

consolidated, and a different panel of this court affirmed all the 

orders. (See AWI Builders, Inc. v. Alliant Consulting (Oct. 22, 

2021, B294662, B297189, B298699, B300834) [nonpub. opn.].) 

In January 2020, while the appeals were pending, plaintiffs 

filed a motion for leave to file a third amended complaint to add 

Nakagama as a defendant in the section 1983 cause of action. 

They asserted that “the facts necessitating the amendment came 

to light during the course of discovery” in the Orange County civil 

lawsuit, when Sandoval testified during her July 2018 deposition 

that Nakagama directed her to withhold documents from 

plaintiffs. The trial court granted plaintiffs leave to file the third 

amended complaint on October 9, 2020, over the objections of 

multiple defendants. 

Plaintiffs filed the operative third amended complaint on 

October 16, 2020. In the section 1983 cause of action, the 

Mekikyans (not AWI) alleged that Nakagama and Sandoval, 

while acting under color of law, “without cause or justification, 

intentionally and maliciously deprived Plaintiffs . . . of rights 

secured to them by the First, Fourth and Fourteenth 

Amendments to the United States Constitution in that each of 

them conspired and acted to create, cause, encourage or seek 

unlawful investigations and prosecutions by the Orange and 
9

Riverside County District Attorney’s Offices” and “administrative 

prosecutions by the DLSE.” The Mekikyans alleged that they 

“suffered and sustained great physical, emotional and 

professional damages,” and their businesses “suffered by the loss 

of numerous projects and business opportunities in the millions of 

dollars.” 

Nakagama filed an anti-SLAPP motion to strike the section 

1983 cause of action in December 2020. She argued that her 

alleged instructions to Sandoval were protected communications 

under section 425.16, subdivisions (e)(1) and (e)(2), because they 

were made in preparation for or anticipation of litigation, and 

under section 425.16, subdivision (e)(4) because they were made 

in connection with an issue of widespread public interest. 

Nakagama further argued that plaintiffs could not meet their 

burden of showing a probability of prevailing on the merits. She

contended that she was immune from liability in her official 

capacity because individuals acting in an official capacity are not 

“persons” for purposes of section 1983. Nakagama also argued 

that plaintiffs could not prevail on their individual capacity 

claim. Specifically, she argued there was no evidence that she 

personally participated in violating plaintiffs’ due process rights 

because Sandoval’s deposition testimony was inadmissible 

hearsay and her own deposition testimony indicated that she only 

directed Sandoval to redact the documents at issue. Nakagama 

additionally argued that plaintiffs “cannot overcome” various 

forms of immunity and privilege, including absolute prosecutorial 

immunity, qualified immunity, and the section 47 litigation 

privilege. 

Plaintiffs filed a written opposition to Nakagama’s antiSLAPP motion in February 2021. They argued that the anti-
10

SLAPP statute did not apply under principles of federal 

preemption and because the gravamen of their complaint, the 

withholding of documents during an investigation, is not 

protected conduct under section 425.16, subdivisions (e)(1), (e)(2), 

or (e)(4). Plaintiffs argued in the alternative that they 

demonstrated a probability of prevailing on the merits even if the 

anti-SLAPP statute did apply. They asserted that their evidence, 

including Sandoval’s deposition testimony, Nakagama’s 

deposition testimony, a DLSE policy manual, and a declaration 

from Robert Mekikyan, demonstrated a prima facie claim for 

violation of their due process rights. They further argued that 

they were likely to prevail on the official capacity claim because 

they sought equitable relief; that prosecutorial immunity did not 

apply because the alleged wrongdoing did not occur during a 

judicial phase; that Nakagama was not entitled to qualified 

immunity because the evidence showed she knew she was acting 

wrongly; and that the litigation privilege did not apply to section 

1983 claims. Nakagama filed a reply the following week. 

The trial court heard the motion in June 2022. In its 

written order, the court rejected plaintiffs’ preemption argument. 

It then found that Nakagama met her first-step burden of 

establishing that the cause of action arose from activity protected 

under section 425.16, subdivision (e)(2), because the gravamen of 

plaintiffs’ cause of action concerned Nakagama’s instructions, 

which were made in connection with official proceedings. At the 

second step, the court first found that plaintiffs met their burden 

of demonstrating a probability of prevailing on the merits

because the Sandoval deposition testimony established a prima 

facie showing that Nakagama ordered the withholding of 

documents to which plaintiffs were entitled. However, it then 
11

considered Nakagama’s affirmative defenses, and concluded that 

she was immune from suit in her official capacity. The trial court 

rejected Nakagama’s assertions of immunity and privilege in her 

individual capacity. The court accordingly granted the motion in 

part, as to the official capacity claim, and denied it in part, as to 

the individual capacity claim.

Nakagama timely appealed. After her death, her personal 

representative, Payne, was substituted into the case. 

DISCUSSION

I. Legal Standards

Under section 425.16, “[a] cause of action arising from a 

person’s act in furtherance of the ‘right of petition or free speech 

under the United States Constitution or the California 

Constitution in connection with a public issue shall be subject to 

a special motion to strike, unless the court determines that the 

plaintiff has established that there is a probability’ that the claim 

will prevail.” (Monster Energy Co. v. Schechter (2019) 7 Cal.5th 

781, 788 (Monster Energy), citing § 425.16, subd. (b)(1).)

“Anti-SLAPP motions are evaluated through a two-step 

process.” (Park v. Board of Trustees of California State 

University (2017) 2 Cal.5th 1057, 1061 (Park).) At the first step, 

“the moving defendant bears the burden of establishing that the 

challenged allegations or claims ‘aris[e] from’ protected activity in 

which the defendant has engaged.” (Ibid.; § 425.16, subds. (b), 

(e).) To carry that burden, the defendant must identify the acts 

upon which each challenged claim rests and show how those acts 

are protected under a statutorily defined category of protected 

activity. (Bonni v. St. Joseph Health System (2021) 11 Cal.5th 

995, 1009 (Bonni).) Section 425.16, subdivision (e) describes four 

categories of acts “‘in furtherance of a person’s right of petition or 
12

free speech’”: “(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.” (§ 425.16, subd. (e).)

“A claim arises from protected activity when that activity 

underlies or forms the basis for the claim.” (Park, supra, 2 

Cal.5th at p. 1062.) Courts consider the elements of the 

challenged claim and what actions by the defendant supply those 

elements and thus form the basis for liability. (Id. at p. 1063.) “A 

claim may be struck only if the speech or petitioning activity 

itself is the wrong complained of, and not just evidence of liability 

or a step leading to some different act for which liability is 

asserted.” (Id. at p. 1060.) 

If the moving defendant carries its burden at the first step, 

the analysis proceeds to the second step, at which the plaintiff

must demonstrate that the claim has at least “minimal merit.” 

(Park, supra, 2 Cal.5th at p. 1062.) This second step is analogous 

to a summary judgment procedure. (Monster Energy, supra, 7 

Cal.5th at p. 788.) “The court does not weigh evidence or resolve 

conflicting factual claims. Its inquiry is limited to whether the 

plaintiff has stated a legally sufficient claim and made a prima 

facie factual showing sufficient to sustain a favorable judgment. 
13

It accepts the plaintiff’s evidence as true, and evaluates the 

defendant’s showing only to determine if it defeats the plaintiff’s 

claim as a matter of law. [Citation.] “[C]laims with the requisite 

minimal merit may proceed.’”” (Ibid., quoting Baral v. Schnitt

(2016) 1 Cal.5th 376, 384-385.) 

We review the trial court’s determination on a special 

motion to strike de novo. Like the trial court, “‘[w]e consider “the 

pleadings, and supporting and opposing affidavits ... upon which 

the liability or defense is based.” [Citation.] However, we neither 

“weigh credibility [nor] compare the weight of the evidence. 

Rather, [we] accept as true the evidence favorable to the plaintiff 

[citation] and evaluate the defendant’s evidence only to 

determine if it has defeated that submitted by the plaintiff as a

matter of law.” [Citation.]’ [Citation.]” (Flatley v. Mauro (2006) 

39 Cal.4th 299, 326.)

II. First Step

At the first step of the analysis, the trial court found that 

Nakagama met her burden of showing that the section 1983 

cause of action against Nakagama in her individual capacity 

came within the ambit of section 425.16, subdivision (e)(2). 

Subdivision (e)(2) protects “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 by law” (§ 425.16, subd. (e)(2)), even if the 

litigation has not yet commenced. (See Flatley v. Mauro, supra, 

39 Cal.4th at p. 322, fn. 11.) The court concluded plaintiffs’ cause 

of action arose from the instructions Nakagama gave to Sandoval 

in connection with the DLSE investigation, an official proceeding 

within the meaning of section 425.16, subdivision (e)(2). 
14

Payne contends the trial court’s analysis was correct. He 

further argues that the trial court also could have found that 

Nakagama met her first-step burden under section 425.16, 

subdivision (e)(4). In response, plaintiffs argue that the trial 

court should have denied the anti-SLAPP motion at the first step 

rather than the second, because the gravamen of their claim 

against Nakagama was the “unlawful and unconstitutional 

withholding of documents,” which is not protected conduct under 

section 425.16, subdivision (e). Although plaintiffs did not file a 

cross-appeal, they are permitted to raise this argument under 

section 906, the purpose of which is “‘to allow a respondent to 

assert a legal theory which may result in affirmance of the 

judgment.’” (Khorsand v. Liberty Mutual Fire Ins. Co. (2018) 20 

Cal.App.5th 1028, 1034.)

There is no dispute that the DLSE investigation and 

hearing process in which the alleged conduct took place “qualify 

as official proceedings authorized by law for purposes of . . .

section 425.16, subdivision (e)(2).” (County of Riverside v. Public 

Employment Relations Board (2016) 246 Cal.App.4th 20, 31.)

The question thus is whether the conduct that forms the basis of 

plaintiffs’ claim is protected activity. “The ‘gravamen is defined 

by the acts on which liability is based, not some philosophical 

thrust or legal essence of the cause of action.’” (Optional Capital, 

Inc. v. Akin Gump Strauss, Hauer & Feld LLP (2017) 18 

Cal.App.5th 95, 111; see also Bonni, supra, 11 Cal.5th at p. 1012.)

A section 1983 claim has two essential elements: “(1) the 

conduct complained of was committed by a person acting under 

color of state law; and (2) the conduct deprived the plaintiff of a 

right, privilege or immunity secured by the Constitution or laws 

of the United States.” (McAllister v. Los Angeles Unified School 
15

District (2013) 216 Cal.App.4th 1198, 1207.) Here, plaintiffs 

allege that Nakagama, while acting under color of law, denied 

plaintiffs due process by instructing a subordinate employee to 

withhold documents from them despite her awareness that 

plaintiffs were entitled to the documents. They further allege 

that Riverside County and Orange County officials “convinced” 

Nakagama “in 2014 and 2015 to also withhold numerous 

documents [plaintiffs] had requested in violation of due process 

protections afforded the accused in administrative hearings.” 

Essentially, Payne argues we should focus exclusively on the 

allegation that Nakagama instructed Sandoval to withhold the 

documents, while plaintiffs contend we should focus exclusively 

on the allegation that Nakagama personally withheld the 

documents. 

However, under Bonni, supra, 11 Cal.5th at p. 1012, “each 

act or set of acts must be analyzed separately,” and Payne bears 

the burden of showing that each allegation supporting the claim 

of recovery rests on protected activity. As to the instructions, 

Payne argues that they are statements or writings related to the 

investigation and gathering of evidence in anticipation of an 

official proceeding. We agree. Apparently plaintiffs do as well; 

they do not dispute that Nakagama’s instructions to Sandoval 

constitute protected activity. Instead, the entirety of their 

argument is predicated on their position that the conduct at issue 

is the withholding of documents. 

To the extent plaintiffs’ claim rests upon Nakagama’s 

alleged withholding of documents, Payne asserts that this court 

“previously held that the failure to disclose information in 

connection with an official proceeding falls within section [sic] 

(e)(2) of the anti-SLAPP statute.” Although she cites an older 
16

case from this Division, Suarez v. Trigg Laboratories, Inc. (2016) 

3 Cal.App.5th 118, a different panel of this court reached the 

same conclusion in the previous appeal in this very case. As 

explained at length in AWI Builders, Inc. v. Alliant Consulting, 

Inc., supra, “the claims arose from Sandoval’s withholding of 

documents in the course of an official proceeding. That conduct is 

protected under subdivision (e)(2) of the anti-SLAPP statute.”

Payne also contends that the withholding of documents

constitutes protected activity under section 425.16, subdivision 

(e)(4), which covers “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.” (§ 425.16, subd. (e)(4).) We 

agree. AWI Builders, Inc. v. Alliant Consulting, Inc. held that 

“the conduct at issue”—the alleged withholding of documents—“is 

protected under the catchall provision of section 425.16, 

subdivision (e)(4).” In distinguishing the cases plaintiffs again 

cite here, most prominently Anderson v. Geist (2015) 236 

Cal.App.4th 79, the panel emphasized that the withholding of 

documents occurred “during the course of an administrative 

proceeding in which she [there, Sandoval] was a representative of 

one of the parties, i.e., the DLSE, an agency of the State, and 

thus was part of the petitioning conduct. The determination of 

what documents should be withheld involved some exercise of 

discretion, since DLSE is required under Labor Code section 1736 

to keep confidential any information that may identify any 

employee who reported a violation.” It continued, “the 

withholding of documents in the present case was done in 

connection with an administrative proceeding involving an 
17

important public issue, i.e., the violation of labor laws by 

contractors on a public work project.”

For the same reasons as previously stated in AWI Builders, 

Inc. v. Alliant Consulting, Inc., we conclude that both forms of

challenged conduct, the instructions to withhold documents and 

the actual withholding of the documents, constitute protected 

activity.

III. Second Step

At the second step of the anti-SLAPP analysis, the burden 

shifts to the plaintiff to demonstrate a probability of prevailing on 

the merits of the claim. In an abbreviated analysis, the trial 

court found that plaintiffs carried that burden by submitting “the 

deposition of Sandoval to establish that [Nakagama], as a 

regional supervisor of the DLSE, ordered the withholding of 

documents to which plaintiffs were entitled.” The trial court

rejected Nakagama’s contention that plaintiffs could not show 

her personal involvement in the alleged deprivation of due 

process, because the parties had presented conflicting evidence on 

that point and courts do not resolve evidentiary conflicts in 

connection with anti-SLAPP motions. The court further rejected 

Nakagama’s arguments that plaintiffs could not prevail because 

she had absolute immunity, qualified immunity, and/or the 

litigation privilege barred the claim. 

Payne now contends that the trial court incorrectly 

concluded that plaintiffs met their burden of showing a 

probability of prevailing. He argues that “any allegation that 

exculpatory documents were withheld from plaintiffs during a 

DLSE action could have been readily remedied by plaintiffs 

pursuant to the Labor Code, Code of Regulations, and Code of 

Civil Procedure, including motions to exclude evidence and 
18

petition for writ of mandate. Plaintiffs did not allege in the TAC 

if they employed these procedural tools to remedy the deprivation 

of their procedural due process rights. There is no evidence that 

Nakagama’s alleged withholding of documents resulted in an 

adverse binding order against plaintiffs in a DLSE action.” In 

short, Payne argues that plaintiffs cannot prevail because they 

did not allege or show that state remedies for the alleged due 

process violation were inadequate.3

Payne acknowledges that his current argument differs from 

those raised below, and requests that we exercise our discretion 

to consider it because it presents only issues of law. Plaintiffs 

respond that Payne has waived the current argument by failing 

to present it below and has not demonstrated why we should 

exercise our discretion in his favor. They also substantively 

oppose the new argument; we address these concerns below. 

As a general rule, a reviewing court will not consider claims 

made for the first time on appeal which could have been but were 

not presented to the trial court. (Truck Ins. Exchange v. AMCO 

Ins. Co. (2020) 56 Cal.App.5th 619, 635.) However, application of 

the forfeiture rule is not automatic, and we have discretion to 

consider pure questions of law raised for the first time on appeal. 

3 Although Nakagama argued below that plaintiffs failed to 

meet their burden, her theory was that plaintiffs lacked evidence 

that she “personally participated in violating plaintiffs [sic] due 

process rights” or “conspired with Sandoval, Schott, or OCDA 

personnel to prevent plaintiffs from lawfully accessing documents 

needed in DLSE administrative hearings to defend themselves, 

or prevented plaintiffs from defending themselves without the 

documents.” 
19

(Cox v. Griffin (2019) 34 Cal.App.5th 440, 450 [“[C]ourts have 

discretion to consider a new theory on appeal if it involves a legal 

question based on undisputed facts”].) Because this appeal raises 

a purely legal issue, and plaintiffs have responded to the new 

contention, we exercise our discretion to consider it during our de 

novo review of plaintiffs’ second-step showing.

At the second step of the anti-SLAPP analysis, the plaintiff 

bears the burden of demonstrating that the challenged claim is 

legally sufficient and supported by a sufficient prima facie factual 

showing to sustain a judgment. (Monster Energy, supra, 7 

Cal.5th at p. 788.) Here, the challenged claim alleges a violation 

of due process under federal law in connection with an 

administrative hearing. Despite their assertion that this lawsuit 

does not seek review of a civil wage and penalty assessment,

plaintiffs allege they responded to “various labor code 

administrative claims . . . [a]s allowed by law” by requesting the 

documents on which the DLSE relied, and DLSE, through 

Nakagama, did not provide them. Plaintiffs’ supporting evidence 

consists primarily of Sandoval’s deposition testimony that 

Nakagama instructed her to withhold the documents. The claim 

and showing are not legally sufficient. 

The allegations and record are not adequate to demonstrate 

a probability that plaintiffs will prevail on the merits of a 

constitutional due process claim. We look to federal law to 

determine the sufficiency of a complaint alleging a federal civil 

rights cause of action under section 1983. (Martinez v. City of 

Clovis (2023) 90 Cal.App.5th 193, 254.) In the context of a 

procedural due process claim, federal law provides that “[w]hen 

state remedies are adequate to protect an individual’s procedural 

due process, a section 1983 action alleging a violation of those 
20

rights will not stand.” (Brogan v. San Mateo County (1990) 901 

F.2d 762, 764; see also Jefferson v. Jefferson County Public School 

System (6th Cir. 2004) 360 F.3d 583, 588 [“Plaintiff may not seek 

relief under Section 1983 without first pleading and proving the 

inadequacy of state or administrative processes or remedies to 

redress her due process violations.”].) “Although one need not 

exhaust state remedies before bringing a Section 1983 action 

claiming a violation of procedural due process, one must 

nevertheless prove as an element of that claim that state 

procedural remedies are inadequate.” (Marino v. Ameruso (2d. 

Cir. 1988) 837 F.2d 45, 47.) It is axiomatic that we cannot 

determine whether plaintiff has sufficiently alleged a cause of 

action for lack of due process without knowing what process is 

due.” (Van Horn v. Department of Toxic Substances Control

(2014) 231 Cal.App.4th 1287, 1295.)

We therefore consider the procedural remedies available 

under California law in DLSE administrative hearing cases, 

particularly the statutes dealing with discovery in administrative 

hearings. “Generally, there is no due process right to prehearing 

discovery in administrative hearing cases.” (Cimarusti v. 

Superior Court (2000) 79 Cal.App.4th 799, 808.) “The scope of 

discovery in administrative hearings is governed by statute and 

the agency’s discretion.” (Id. at pp. 808-809.) The relevant 

statutes here are Labor Code sections 1741 and 1742. Labor Code 

section 1741 authorizes the Labor Commissioner or his or her 

designee to conduct investigations to determine if wage laws have 

been violated. (Lab. Code, § 1741, subd. (a).) If a violation is 

found, the Commissioner “shall with reasonable promptness 

issue a civil wage and penalty assessment to the contractor or 

subcontractor, or both. The assessment shall be in writing, shall 
21

describe the nature of the violation and the amount of wages, 

penalties, and forfeitures due, and shall include the basis for the 

assessment. . . . The assessment shall advise the contractor and 

subcontractor of the procedure for obtaining review of the 

assessment.” (Lab. Code, § 1741, subd. (a).) It must be 

“sufficiently detailed to provide fair notice to the contractor or 

subcontractor of the issues at the hearing.” (Lab. Code, § 1742, 

subd. (b).) 

Labor Code section 1742 gives a contractor or subcontractor 

the right to “review of a civil wage and penalty assessment” if a 

request for review is made within 60 days after the assessment is 

served. (Lab. Code, § 1742, subd. (a).) The contractor or 

subcontractor “shall have the burden of proving that the basis for 

the civil wage and penalty assessment is incorrect,” but also 

“shall be provided an opportunity to review evidence to be 

utilized by the Labor Commissioner at the hearing within 20 

days of the receipt of the written request for a hearing.” (Lab. 

Code, § 1742, subd. (b).) If the Commissioner fails “to make 

evidence available for review as required by Labor Code section 

1742(b) and this Rule [Cal. Code Regs., tit. 8, § 17224], [sic] shall 

preclude the Enforcing Agency from introducing such evidence in 

proceedings before the Hearing Officer or the Director.” (Cal. 

Code Regs., tit. 8, § 17224, subd. (d).) If the contractor or 

subcontractor is dissatisfied with the hearing procedures or

resultant decision, he or she may seek review by filing a petition 

for writ of mandate in the superior court. (Lab. Code, § 1742, 

subd. (c); Mobley v. Los Angeles Unified School District (2001) 90 

Cal.App.4th 1221, 1241.) If the contractor or subcontractor

believes he or she was deprived of the opportunity to fully present 

a claim or defense due to extrinsic fraud, he or she may move to 
22

vacate the resultant judgment. (See Department of Industrial 

Relations, Division of Labor Standards Enforcement v. Davis 

Moreno Construction, Inc. (2011) 193 Cal.App.4th 560, 566, 570-

573.) 

The record contains two civil wage and penalty 

assessments related to the OC Fair Project, issued in September 

and October 2015. It also alludes to but does not contain a civil 

wage and penalty assessment “over $500,000” related to the 

Public Defender Project that appears to have been issued around 

the same time. Plaintiffs do not specify the civil wage and 

penalty assessment(s) for which they sought review or related 

documents; they assert only that they made requests for 

documents in 2014—long before the assessments were issued—

and in 2015, and those requests were denied. There are no 

allegations in the operative complaint or evidence in the record

regarding the hearings on the petitions, their outcomes, or 

plaintiffs’ efforts to seek review. The complaint alleges only that 

unspecified documents were withheld in connection with 

unspecified proceedings, and plaintiffs’ evidence indicates only 

that Nakagama may have been involved in that withholding.

The Labor Code provisions, related regulations, and other 

aspects of state law discussed above impose requirements and

provide remedies aimed at ensuring that contractors and 

subcontractors receive due process in connection with civil wage 

and penalty assessments. The allegations and record are silent 

as to plaintiffs’ utilization of these remedies or the adequacy or 

inadequacy thereof. This is fatal to their claim under federal law. 

Plaintiffs contend this is “absurd” and “equivalent to telling 

a criminal defendant that he must prove he did not rob a store 

while at the same time refusing to disclose to him an alibi 
23

witness, but the defendant can prevent the prosecutor calling the 

alibi witness at trial.” However, federal law clearly provides that 

state remedies for procedural due process violations must be 

taken into consideration when a plaintiff seeks to assert a section 

1983 claim for violation of due process. Plaintiffs also assert that 

Labor Code sections 1741 and 1742 do not apply to “limit [their] 

available remedies” because they “do not seek review for a civil 

wage and penalty assessment . . . [or] the withholding of contract 

payments.” These statutes are the law that gave plaintiffs the 

right to request documents from DLSE after “various labor code 

administrative claims were filed by DLSE in 2015.” They govern 

the scope of discovery and other process to which plaintiffs are 

entitled and provide a framework for plaintiffs to seek relief from 

civil wage and penalty assessments they believe are inaccurate or 

improper. Plaintiffs do not cite any authority for the proposition 

that Labor Code sections 1741 and 1742 and the procedural 

remedies provided therein are irrelevant to their section 1983 

claim. 

Plaintiffs assert they were “severely harmed” because the 

withholding of the unspecified documents prevented them from 

“adequately preparing for the various DLSE investigations and 

administrative proceedings”; forced them to incur “unnecessary 

attorney’s fees, the costs of several settlements, and assessment 

of administrative penalties”; and deprived them of the ability “to 

counteract additional lawsuits and the various attacks on their 

reputation.”4 They did not present any evidence of these harms

to the trial court, however. Instead, they sought to establish a 

4 Injury to one’s reputation alone will not support a federal 

due process claim. (Burt v. County of Orange (2004) 120 

Cal.App.4th 273, 283.) 
24

probability of prevailing based solely on the allegedly wrongful 

withholding of documents during the administrative process. 

Similarly, the trial court’s second-step analysis narrowly focused

on the plaintiffs’ evidence that documents were withheld rather 

than on the bigger picture of the procedural remedies available to 

plaintiffs and the adequacy thereof. 

Finally, plaintiffs emphasize that Nakagama testified that 

she understood “due process” to mean “[p]roviding the contractors 

with information that would be relevant . . . to any allegations or 

issues against him.” Nakagama’s personal understanding of the 

contours of due process is not sufficient to demonstrate a 

probability that plaintiffs will prevail on their section 1983 claim 

against her. The ultimate question in a due process action is 

whether the plaintiff received the procedural due process to 

which he or she was legally entitled. Plaintiffs’ allegations and 

evidentiary showing do not establish a likelihood that they will 

prevail on that question. We accordingly need not and do not 

address Payne’s arguments regarding immunities and privilege.

DISPOSITION

The order denying Nakagama’s anti-SLAPP motion to 

strike the third amended complaint is reversed with directions to 

grant the motion and strike the complaint as to Nakagama and 

her personal representative Payne. The parties are to bear their 

own costs. 

NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS

COLLINS, J.

We concur:

CURREY, P. J. ZUKIN, J.