Court Opinion

ID: 4558302
Source: CourtListenerOpinion
Date Created: 2020-08-24 23:02:13.724126+00
Date Added: 2024-06-11T09:59:26.706347
License: Public Domain

Filed 8/24/20 Bohm Wildish & Matsen v. Selfridge CA4/3

                      NOT TO BE PUBLISHED IN OFFICIAL REPORTS
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 This opinion has not been certified for publication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

                                     FOURTH APPELLATE DISTRICT

                                                DIVISION THREE

 BOHM WILDISH & MATSEN, LLP
 et. al.,
                                                                         G058327
      Plaintiffs and Respondents,
                                                                         (Super. Ct. No. 30-2019-01075384)
           v.
                                                                         OPINION
 LANCE A. SELFRIDGE et. al.,

      Defendants and Appellants.

                   Appeal from an order of the Superior Court of Orange County, James L.
Crandall, Judge. Affirmed.
                   Nemecek & Cole, Mark Schaeffer and Marshall R. Cole for Defendants and
Appellants.
                   Bohm Wildish & Matsen, James G. Bohm, Gilbert A. Partida; Ulwelling
Law, James K. Ulwelling and Lauren E. Saint for Plaintiffs and Respondents.
                                          *                  *                  *
              Lance A. Selfridge and Joseph K. Hegedus, attorneys at Lewis Brisbois
Bisgaard & Smith, LLP (collectively henceforth Lewis Brisbois), appeal from an order
denying their motion to strike the complaint for breach of fiduciary duty filed against
them by James G. Bohm and the law firm of Bohm Wildish & Matsen, LLP (collectively
Bohm Wildish), under Code of Civil Procedure section 425.16 (the anti-SLAPP law).
              Lewis Brisbois asserts that while the trial court correctly ruled that Bohm
Wildish’s lawsuit arose out of activity protected by the anti-SLAPP law—i.e., the
statements made by Lewis Brisbois lawyers against Bohm Wildish in the course of
representing another client in litigation—it erred by failing to recognize the same activity
was protected by the litigation privilege, and thus Bohm Wildish’s lawsuit had no
probability of success on the merits.
              Bohm Wildish responds by asserting that the court’s only error was in
determining that the anti-SLAPP law applied in the first instance. Bohm Wildish claims
that its cause of action against Lewis Brisbois arises out of a breach of the duty of loyalty
Lewis Brisbois owed to Bohm Wildish as its client, and that the breach therefore
occurred before Lewis Brisbois made any statements in court. We agree with Bohm
Wildish and, although we disagree with the trial court’s analysis, we affirm the court’s
order denying the motion.

                                          FACTS
              This lawsuit arises out of a complicated, multi-part family dispute (the
Sacher litigation). Initially, Bohm Wildish represented Fred Sacher, the family patriarch,
in litigation against his son, Kenneth, to establish control over a family trust. In February
2017, Fred represented by Bohm Wildish, filed an elder abuse complaint against Kenneth
and other family members, alleging he had been improperly pressured to sign various
documents.

                                              2
              Kenneth and other family members, represented by attorneys from Lewis
Brisbois, filed an answer to Fred’s complaint in which they asserted, as an affirmative
defense, that Fred was legally incapacitated and was acting pursuant to the undue
influence of Bohm Wildish attorneys. Kenneth also filed a complaint on behalf of his
mother against Fred, alleging financial elder abuse, fraud and related causes of action.
That complaint repeated allegations of misconduct against Bohm Wildish attorneys.
              In May of 2017, Fred and Bohm Wildish moved jointly to disqualify Lewis
Brisbois from representing Kenneth and the other family members in any of the three
proceedings; i.e., Fred’s trust petition and elder abuse action, and Kenneth’s elder abuse
action on behalf of his mother. They contended Lewis Brisbois should be disqualified
because it concurrently represented Bohm Wildish in an unrelated case, and thus its
allegations of unethical conduct against Bohm Wildish in the current litigation breached
its duty of loyalty to its client. They also represented to the court that they would
withdraw the disqualification motions if Lewis Brisbois would agree to refrain from
direct attacks against Bohm Wildish in the litigation; Lewis Brisbois refused.
              The trial court granted the motions, concluding that Bohm Wildish
remained a current client of Lewis Brisbois in an unrelated case, and that the Lewis
Brisbois representation of Kenneth and other family members against Fred had included
“numerous, direct attacks on the professional integrity of another . . . client.” We
affirmed that order on appeal. (Sacher v. Sacher (June 3, 2019, G055822) [nonpub.
opn.].)
              In June 2019, Bohm Wildish filed a complaint against Lewis Brisbois,
alleging a single cause of action for breach of fiduciary duty. The complaint detailed the
facts of the Sacher litigation, the factual allegations made by Lewis Brisbois against
Bohm Wildish, and Bohm Wildish’s demands that Lewis Brisbois either withdraw from
representing Kenneth, or agree not to make such allegations against it going forward.
The complaint cited former Rule 3-310(c) of the State Bar Rules of Professional Conduct

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(now Rule 1.7) as reflecting an attorney’s duty of loyalty to a client, and referred to the
course of conduct engaged in by Lewis Brisbois as “repeatedly and egregiously
breach[ing] their fiduciary duty of loyalty owed to current clients.”
              Specifically, the complaint alleges that “[s]hortly after taking on
representation of Kenneth Sacher . . . in the Sacher Family Litigation, [Lewis Brisbois]
adopted a litigation strategy that included attacking the professional and ethical abilities
of their very own clients, [Bohm Wildish], which attacks were made to advance the
interests of [Lewis Brisbois’s] other clients in the Sacher Family Litigation.” The
complaint also alleges that Lewis Brisbois “breached their fiduciary duty of loyalty owed
to [Bohm Wildish] by committing . . . acts” that included but were not limited to
“accusing [Bohm Wildish] of committing grievous ethical violations” and “refusing to
withdraw as counsel despite the obvious, concurrent conflict of interests.”
              Lewis Brisbois responded to the complaint by moving to strike it under the
anti-SLAPP law. It argued that the cause of action alleged against it “consists entirely of
communications made by [Lewis Brisbois] in pending litigation, and thus, the alleged
wrongful conduct is based on constitutionally protected activity under § 425.16,” and that
Bohm Wildish could not demonstrate a probability of prevailing on the merits because
“the communications are absolutely privileged under Civil Code § 47(b) and the
Complaint is barred by the statute of limitations in CCP § 340.6.”
              Bohm Wildish opposed the motion, arguing that the breach of fiduciary
duty by Lewis Brisbois “arose the moment [Lewis Brisbois] determined that in order to
effectively represent one client, . . . they would need to attack another current client to
whom they owed a duty of loyalty.” Bohm Wildish also disputed the contention that the
statements made in court by Lewis Brisbois were protected by the privilege set forth in
Civil Code section 47, subdivision (b), asserting that the privilege “does not apply to an
attorney’s alleged breach of fiduciary duty,” and claimed that the statute of limitations on
its claim was tolled while Lewis Brisbois continued to represent it.

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              The trial court denied the motion. In its ruling, the court relied largely on
Fremont Reorganizing Corp. v. Faigin (2011) 198 Cal.App.4th 1153 (Fremont
Reorganizing). In that case, a company sued its former in-house counsel for breach of
fiduciary duty based on the attorney’s revelation of client misconduct to the Insurance
Commissioner. The appellate court reasoned that the anti-SLAPP law applied because
the attorney’s alleged liability arose from his statements in connection with a judicial
proceeding, but also that the statements were not governed by the absolute privilege set
forth in Civil Code section 47. (Id. at p. 1172.)
              In denying the motion, the trial court here reached the same conclusion. It
first reasoned that although Bohm Wildish’s cause of action was characterized as alleging
a breach of a fiduciary duty, the specific wrongdoing alleged was that “defendants
breached their professional duties they owed to plaintiffs by making the statements in the
Sacher litigation.” Thus, the cause of action arose out of protected speech that was
entitled to the protections of the anti-SLAPP law. Nonetheless, the court found Bohm
Wildish had demonstrated a likelihood of success on the merits because “‘the litigation
privilege is inapplicable in an action by a former client against an attorney for breach of
professional duties.’”

                                      DISCUSSION
       1.     The Anti-SLAPP Law
              The anti-SLAPP law provides a summary mechanism to test the merit of
any claim arising out of a defendant’s protected speech or petitioning activities. The law
authorizes courts to strike any cause of action which falls within the statute’s purview, if
the plaintiff cannot demonstrate a probability of prevailing on it. (Code Civ. Proc.,
§ 425.16.) “Attempting to protect against ‘lawsuits brought primarily to chill’ the
exercise of speech and petition rights, the Legislature embedded context into the statutory
preamble, ‘declar[ing] that it is in the public interest to encourage continued participation

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in matters of public significance.’” (FilmOn.com Inc. v. DoubleVerify Inc. (2019)
7 Cal.5th 133, 143 (FilmOn.com).)
              “Because our ‘primary goal is to determine and give effect to the
underlying purpose of’ the anti-SLAPP statute” we will “liberally extend the protection
of the anti-SLAPP statute where doing so would ‘encourage continued participation in
matters of public significance,’ but withhold that protection otherwise.” (FilmOn.com,
supra, 7 Cal.5th at p. 154.)
              When a party moves to strike a complaint on the basis of the anti-SLAPP
law, the court engages in a two-step process in determining whether a defendant’s motion
to strike should be granted. “First, the court decides whether the defendant has made a
threshold showing that the challenged cause of action is one arising from protected
activity. The moving defendant’s burden is to demonstrate that the act or acts of which
the plaintiff complains were taken ‘in furtherance of the [defendant]’s right of petition or
free speech under the United States or California Constitution in connection with a public
issue,’ as defined in the statute.” (Equilon Enterprises v. Consumer Cause, Inc. (2002)
29 Cal.4th 53, 67.)
              Then, only if the court finds the defendant has made that required showing,
the burden shifts to the plaintiff to demonstrate “there is a probability that the plaintiff
will prevail on the claim.” (Code Civ. Proc., § 425.16, subd. (b)(1); DuPont Merck
Pharmaceutical Co. v. Superior Court (2000) 78 Cal.App.4th 562, 565.)
              We review de novo an order made pursuant to the anti-SLAPP law.
(ComputerXpress, Inc. v. Jackson (2001) 93 Cal.App.4th 993, 999 [“Whether section
425.16 applies and whether the plaintiff has shown a probability of prevailing are both
reviewed independently on appeal”].)
       2.     The Protected Activity Prong
              The anti-SLAPP law applies only to “[a] cause of action against a person
arising from any act of that person in furtherance of the person’s right of petition or free

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speech under the United States Constitution or the California Constitution in connection
with a public issue . . . .” (Code Civ. Proc., § 425.16, subd. (b)(1).)
              The statute defines an “‘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’” to include specific categories of speech and petitioning activities, including:
(1) any statements or writings made before a legislative, executive, or judicial
proceeding, or any other official proceeding authorized by law; (2) any statements or
writings made in connection with an issue under consideration or review by any such
body or official proceeding; (3) any oral statement or writing made in a place open to the
public or a public forum in connection with an issue of public interest. (Code Civ. Proc.,
§ 425.16, subd. (e)(1-3).)
              A defendant who files a special motion to strike bears the initial burden of
demonstrating that the challenged cause of action arises from protected activity. (Equilon
Enterprises v. Consumer Cause, Inc., supra, 29 Cal.4th at p. 67.) A cause of action does
not “arise from” protected activity simply because it is filed after protected activity took
place. (City of Cotati v. Cashman (2002) 29 Cal.4th 69, 76–77.) The fact “[t]hat a cause
of action arguably may have been triggered by protected activity” does not necessarily
mean that it arises from such activity. (Id. at p. 78.)
              As our Supreme Court explained, “the critical point is whether the
plaintiff’s cause of action itself was based on an act in furtherance of the defendant’s
right of petition or free speech.” (City of Cotati v. Cashman, supra, 29 Cal.4th at p. 78.)
In other words, “the defendant’s act underlying the plaintiff’s cause of action must itself
have been an act in furtherance of the right of petition or free speech.” (Ibid.) And “[i]n
deciding whether the ‘arising from’ requirement is met, a court considers ‘the pleadings,
and supporting and opposing affidavits stating the facts upon which the liability or
defense is based.’” (Id. at p. 79.)

                                               7
               In this case, the wrongful act by Lewis Brisbois which gave rise to Bohm
Wildish’s cause of action was its agreement to represent a client whose contention was
that Bohm Wildish itself—as opposed to Bohm Wildish’s client—had engaged in
wrongdoing. This is because a “fundamental value of our legal system is the attorney’s
obligation of loyalty. Attorneys have a duty to maintain undivided loyalty to their clients
to avoid undermining public confidence in the legal profession and the judicial process.”
(People ex rel. Dept. of Corporations v. SpeeDee Oil Change Systems, Inc. (1999)
20 Ca1.4th 1135, 1146.) Thus, “if an attorney—or more likely a law firm—
simultaneously represents clients who have conflicting interests, a . . . per se rule of
disqualification applies. With few exceptions, disqualification follows automatically,
regardless of whether the simultaneous representations have anything in common or
present any risk that confidences obtained in one matter would be used in the other.”
(Id. at p. 1147)
               The stringency of this rule is illustrated in Flatt v. Superior Court (1994)
9 Cal.4th 275 (Flatt). In Flatt our Supreme Court concluded that when an attorney
became aware the focus of a new client’s legal malpractice case was a current client of
her firm, that attorney was “required . . . to sever any professional relation with [the new
client] promptly upon learning of the conflict” and without providing any subsequent
advice regarding the case. (Id. at p. 281.) In Flatt, the attorney did just that, and was
subsequently sued for malpractice by the now former client based on her alleged failure
to advise him of the statute of limitations applicable to his contemplated malpractice
claim against her firm’s existing client. The Supreme Court explained that counsel,
under these circumstances, had no duty to offer such advice, as doing so would have
violated her duty of loyalty to the firm’s first client. (Id. at p. 290.)
               In contrast to the attorney in Flatt, Lewis Brisbois did not “promptly” sever
its relationship with Kenneth when it knew (or should have known) of the conflict
between him and Bohm Wildish. Instead, it refused to leave the case insisting on its right

                                                8
to continue representing Kenneth as he attacked Bohm Wildish’s professional
performance. It was that decision, rather than any specific statement made in court,
which constituted a breach of its duty of loyalty to Bohm Wildish. Indeed, the breach
would have been established even if Lewis Brisbois had confined its representation of
Kenneth to behind-the-scenes advice, and had never officially appeared in court on his
behalf.
                   Several cases have made this point. In Benasra v. Mitchell Silberberg
& Knupp LLP (2004) 123 Cal.App.4th 1179, 1189 (Benasra) for example, the court
explained that a client’s claim against an attorney for breach of loyalty “occurs not when
the attorney steps into court to represent the new client, but when he or she abandons the
               1
old client.”
                   Likewise, in Freeman v. Schack (2007) 154 Cal.App.4th 719, 732
(Freeman), the court concluded “that the principal thrust of the conduct underlying their
causes of action is not Schack’s filing or settlement of litigation, [but was instead] his
undertaking to represent a party with interests adverse to plaintiffs, in violation of the
                                                     2
duty of loyalty he assertedly owed them . . . .”         In United States Fire Ins. Co. v.

          1
               Lewis Brisbois contends Benasra is distinguishable because Bohm Wildish
“admitted” it is not concerned about the Lewis Brisbois representation of Kenneth, but
only the “statements in the Sacher actions that accused [Bohm Wildish] of wrongdoing in
[its] representation of Fred.” Thus, Lewis Brisbois contends the alleged breach in this
case occurred only when it made those statements in court. We disagree. That
characterization misconstrues Bohm Wildish’s argument. Bohm Wildish’s position is
that while it would not be a breach of loyalty for Lewis Brisbois to represent a client
whose interests are opposed to those of Bohm Wildish’s client, it is a breach to do so if
Lewis Brisbois intends to argue that the merits of the dispute turn on the alleged
misconduct of Bohm Wildish itself.
          2
               Lewis Brisbois asserts that Freeman is inapposite because “[u]nlike the
situation in Freeman, . . . Ken[neth] did not have any interests adverse to Bohm.” Again
we disagree. Kenneth did not only make allegations against his father, Fred, in the
lawsuit; he also directly alleged wrongdoing by Bohm Wildish. Thus, Kenneth and
Bohm Wildish are directly adverse to each other with respect to the merits of the case.

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Sheppard, Mullin, Richter & Hampton LLP (2009) 171 Cal.App.4th 1617, 1628, the court
reasoned “the misconduct averred in the underlying complaint is the acceptance by
Sheppard Mullin of representation adverse to U.S. Fire. To the extent the complaint refers
to events taking place during [the subsequent] Litigation, its evident purpose is to support
the conclusion that the two matters are substantially related, therefore making Sheppard
Mullin’s disqualification in that litigation automatic. Thus, reference to protected activity
is only incidental to the principal thrust of the complaint.”
              Finally, in Castleman v. Sagaser (2013) 216 Cal.App.4th 481, the court
concluded “that respondents’ causes of action do not arise from protected activity within
the meaning of the anti-SLAPP statute. The foundation of each claim is the allegation
that Sagaser chose to align himself with respondents’ adversaries, in direct opposition to
respondents’ interests, thereby breaching duties of loyalty and confidentiality owed to
them by virtue of a prior attorney-client relationship. Respondents’ complaint specifically
alleges that Sagaser violated the State Bar Rules of Professional Conduct, including
rule 3–310, which is the principal thrust of their lawsuit.” (Id. at p. 493.)
              Fremont Reorganizing, supra, 198 Cal.App.4th 1153, the case relied upon
by the trial court in concluding that a claim alleging breach of an attorney’s duty of
loyalty does arise out of petitioning activity, is factually distinguishable. In that case
there was no allegation that the attorney (the plaintiff’s former in-house counsel) had
aligned himself with a new client whose interests conflicted with the plaintiff’s. Instead,
the allegation was that the former attorney had breached his duty of loyalty by disclosing
detrimental information about his client to a regulator, in connection with an official
proceeding. Thus, in Fremont Reorganizing, the alleged communication was itself the
specific act of wrongdoing that gave rise to liability. In that factual context, we agree
with the court’s conclusion the anti-SLAPP law applied to the cause of action.

                                              10
              But in this case, as we have explained, the cause of action arises out of the
decision made by Lewis Brisbois to align itself with Kenneth, and against Bohm Wildish,
to whom it owed a duty of loyalty. That alleged breach was not dependent on any
statements made by Lewis Brisbois as it represented Kenneth. While those statements
may have been what triggered Bohm Wildish’s lawsuit, that triggering effect does not
demonstrate the cause of action arose from them.
              In arguing otherwise, Lewis Brisbois contends that because Bohm
Wildish’s complaint alleges it was damaged by the statements made by Lewis Brisbois in
court, it is those statements, rather than the more abstract breach of loyalty, which give
rise to the cause of action. We disagree. In Renewable Resources Coalition, Inc., v.
Pebble Mines Corp. (2013) 218 Cal.App.4th, 384 (Renewable Resources), an anti-mining
nonprofit organization sued two mining companies and their attorney, alleging the
defendants had improperly induced the nonprofit’s fundraiser to sell them confidential
information, and then used that information to prosecute a complaint against the
nonprofit before a governmental agency. The trial court granted the mining companies’
anti-SLAPP motion, concluding that although the nonprofit claimed its suit was based on
the improper inducement of the fundraiser, its damage allegations demonstrated that the
actual harm it suffered was a direct result of the mining companies’ protected act of
prosecuting the complaint. (Id. at pp. 396-397.) If that reasoning were affirmed by the
appellate court, then Renewable Resources would support Lewis Brisbois’s assertion.
              The appellate court reversed, explaining that “to determine the applicability
of the anti-SLAPP statute, we look to the allegedly wrongful and injurious conduct of the
defendant, rather than the damage which flows from said conduct.” (Renewable
Resources, supra, 218 Cal.App.4th at pp. 396-397.) In that case, the wrongful and
injurious conduct was “that the Pebble defendants allegedly wrongfully purchased the
Coalition’s confidential documents . . . .” (Id. at p. 397.) That same reasoning, applied in
this case, demonstrates that the injurious conduct by Lewis Brisbois was its breach of

                                             11
loyalty to Bohm Wildish. The statements Lewis Brisbois made in court and its other
alleged acts of disloyalty are evidence that relate to potential damages flowing from that
breach.
              Because Bohm Wildish’s cause of action arises out of Lewis Brisbois’s
breach of its duty of loyalty owed to Bohm Wildish, rather than out of any specific
statements or actions in court, the cause of action is not subject to a special motion to
strike under the anti-SLAPP law.
       3.     The Reasonable Probability of Prevailing Prong
              Because we have concluded that Bohm Wildish’s cause of action does not
arise from conduct protected by the anti-SLAPP law, we need not address the second
prong of the anti-SLAPP analysis.

                                      DISPOSITION
              The order is affirmed. Bohm Wildish is to recover its costs on appeal.

                                                  GOETHALS, J.

WE CONCUR:

FYBEL, ACTING P. J.

THOMPSON, J.

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