Court Opinion

ID: 8313958
Source: CourtListenerOpinion
Date Created: 2022-10-17 19:01:47.672226+00
Date Added: 2024-06-11T16:44:52.481515
License: Public Domain

Filed 10/17/22 From The Earth v. Beltran CA2/7
   NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS

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IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

                         SECOND APPELLATE DISTRICT

                                      DIVISION SEVEN

FROM THE EARTH, LLC,                                          B310055

         Plaintiff and Respondent,                            (Los Angeles County
                                                              Super. Ct. No. 20STCV36221)
         v.

MARIO BELTRAN,

         Defendant and Appellant.

     APPEAL from an order of the Superior Court of Los
Angeles County. Michael P. Linfield, Judge. Affirmed.
     Urtnowski & Associates, J. Brian Urtnowski and Lisamarie
McDermott for Plaintiff and Respondent.
     Law Office of Jose Luis Fuentes and Jose Luis Fuentes for
Defendant and Appellant.

                         ________________________________
       The City of Commerce denied commercial cannabis licenses
to From The Earth, LLC after the company refused to participate
in an alleged extortion and kickback scheme operated by Mario
Beltran, a cannabis lobbyist. From The Earth sued Beltran and
the City, alleging Beltran had colluded with the City in an
attempt to extort From The Earth and the City had violated
From The Earth’s right to equal protection by denying its license
application on pretextual grounds while approving cannabis
licenses for similar applicants. Beltran filed a special motion to
strike the extortion cause of action (Code Civ. Proc., § 425.16),1
contending his conduct constituted protected petitioning activity
under the statute and From The Earth could not establish a
probability of prevailing on the merits. The trial court denied the
motion, ruling the cause of action against Beltran for extortion
did not arise from protected activity. Although we disagree with
the trial court’s reasoning, because From The Earth established
the requisite minimum probability of prevailing on the merits, we
affirm.
      FACTUAL AND PROCEDURAL BACKGROUND
      1. From The Earth’s Unsuccessful Application for Cannabis
          Licenses
      In a declaration filed with From The Earth’s opposition to
Beltran’s special motion to strike, Kintu Patel, a founding
member and manager of the company, described the factual
background of From The Earth’s cause of action for extortion.
According to Patel, in October 2018 From The Earth applied to
the City for non-storefront commercial cannabis delivery,

1     Statutory references are to this code unless otherwise
stated.

                                 2
cultivation, manufacturing and distribution business licenses. As
part of its application From The Earth completed a mapping
report verifying that its proposed business location was more
than 600 feet from any schools, daycares, parks and youth
centers as required by the City’s municipal code.
      On October 31, 2018 the City notified From The Earth its
application had been successfully submitted and was being
advanced to phase two of the application process. On
November 7, 2018 the City notified From The Earth it was a
“qualified applicant” and its application had advanced to the
third and final phase, city council consideration.
      Around the time of the City’s November 7, 2018 notice,
Beltran telephoned Patel. Patel’s declaration stated he
understood Beltran was a former City of Bell councilmember with
a criminal record and a reputation for attempting to assert
influence in cities that were awarding cannabis licenses.
According to Patel, Beltran stated, if From The Earth did not
engage him as a lobbyist for its application process and pay
Beltran certain kickbacks, he would ensure the City would deny
From The Earth’s cannabis license application. (Beltran denies
making any such threat.) From The Earth did not respond to or
engage Beltran’s services.
      On November 16, 2018 the City sent From The Earth a
conditional “Notice of Selection,” stating the city council had
voted to authorize From The Earth to continue to advance
through the permit process “in order to ultimately establish a
lawful commercial cannabis business in the City.” The Notice of
Selection was contingent on From The Earth fulfilling all
applicable requirements, including obtaining a recommendation
of approval from the city planning commission and the city

                                3
council’s final approval of From The Earth’s development
agreement.
       On November 30, 2018 Beltran emailed From The Earth
and attached a proposed contract. Among other things the
contract required From The Earth to make an initial payment of
$50,000 to Beltran upon award of the permits, pay Beltran
$2,500 per month, for an indefinite amount of time, and
encumber any future purchaser of From the Earth’s business
with the obligation to pay Beltran $2,500 monthly (or
alternatively, pay Beltran 10 percent of the purchase price), in
exchange for which Beltran would “solidify [From The Earth’s]
efforts to secure local permits or licenses to operate cannabis
businesses, specifically in the City of Commerce.” Beltran
requested that From The Earth sign and return the contract
within 24 hours.
       Within minutes of From The Earth receiving Beltran’s
email and contract on November 30, the City sent an email
notifying From The Earth it was authorized to apply for a
temporary business license to engage in commercial cannabis
activities. The City addressed this email to two principals of
From The Earth and to “Mario”—Beltran’s first name. From The
Earth had neither retained Beltran nor notified the City that it
had any relationship to him.
       Patel immediately asked the City to remove Beltran from
any future correspondence with From The Earth. The following
day Patel told Beltran that From The Earth would not retain him
for any lobbying services.
       On February 13, 2019 the City’s planning commission voted
to recommend the city council deny From The Earth’s
application. On April 30, 2019 the city council considered and

                               4
denied From The Earth’s application for commercial cannabis
licenses.
       2. From The Earth’s Complaint
       From The Earth sued the City and Beltran on
September 22, 2020 alleging the City and Doe defendants had
violated its Fourteenth Amendment right to equal protection and
Beltran and Doe defendants were liable for extortion. The
complaint detailed the steps taken by From The Earth to obtain
approval of its commercial cannabis licenses, Beltran’s efforts to
be retained by From The Earth and his implied threats of
adverse consequences if it did not hire him and the ultimate
decision by the City to deny From The Earth’s application. In
particular, paragraph 25 of the complaint alleged, “Defendant
Beltran made threats to Plaintiff’s business interest through both
telephonic and written communication by [sic] when they told
Plaintiff that if Plaintiff did not engage defendant Beltran as its
lobbyist for Plaintiff’s Business License Application process and
not pay certain kickbacks to defendant Beltran, defendant
Beltran would ensure that defendant City of Commerce would
deny all of the Cannabis Licenses Plaintiff sought. . . . Defendant
Beltran had his connection to carry out his threats to Plaintiff
displayed in an email defendant City of Commerce sent to
Plaintiff, which feigned a presupposition that Plaintiff had
agreed to the engage in the illegal kickback scheme with
defendant Beltran.”
      3. The Special Motion To Strike
      Beltran filed a section 425.16 special motion to strike the
cause of action for extortion on October 28, 2020. In his motion
Beltran argued his offer of lobbying services to From The Earth
in connection with the company’s pending cannabis license

                                 5
application and his communications with the City related to
cannabis licenses were protected speech or petitioning activity.
In addition, he contended, his communications on which From
The Earth’s cause of action was based were absolutely privileged
under Civil Code section 47, subdivision (b)(1) and (3).
      In its opposition to the motion From The Earth submitted
Patel’s declaration, described in a preceding section, and argued
extortion is not a protected form of speech; Beltran’s
communications with From The Earth were not made in
connection with an issue of public interest; and his speech was
not privileged under Civil Code section 47, subdivision (b).
      After hearing argument the trial court denied the motion.
At the outset of its ruling the court wrote, “The issue presented
here is simple: is an alleged extortion scheme protected by the
anti-SLAPP statute. The answer is equally simple: No.”
      The court explained, “Defendant fails to meet his initial
burden to make a prima facie showing that the gravamen of
Plaintiff’s allegations against Defendant are protected by Code of
Civil Procedure section 425.16. Contrary to Defendant’s
assertion, the gravamen of Plaintiff’s claim against him are not
based on speech or writing made in connection with an issue
under review or consideration by an official proceeding with the
City of Commerce’s city council. Instead, the gravamen of
Plaintiff’s claim against Defendant Beltran is that Defendant
Beltran made telephonic and written threats to Plaintiff,
threatening that if Plaintiff did not use Defendant Beltran’s
lobbying services, then Defendant Beltran would retaliate
against Plaintiff and ensure that Defendant City of Commerce
would deny the cannabis licenses Plaintiff applied to receive from
Defendant City of Commerce. [Citation.] [¶] Defendant has

                                6
failed to meet his initial burden to demonstrate how these
allegations, central to Plaintiff’s claim for extortion against
Defendant, arise from protected activity pursuant to the anti-
SLAPP statute.”2
       Beltran filed a timely notice of appeal.
                          DISCUSSION
      1. The Special Motion To Strike: Governing Law and
         Standard of Review
       Section 425.16, commonly known as the anti-SLAPP
statute, makes available a special motion to strike certain
meritless claims early in the litigation: “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 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 plaintiff will prevail on the claim.”
(§ 425.16, subd. (b)(1); see Rand Resources, LLC v. City of Carson
(2019) 6 Cal.5th 610, 619-620 [“[a] court may strike a cause of

2      Several weeks after denying Beltran’s motion, the trial
court denied the City’s special motion to strike. We affirmed that
order in a nonpublished opinion earlier this year (From The
Earth, LLC v. City of Commerce (Mar. 15, 2022, B311070)),
holding the City’s decision to deny From The Earth’s cannabis
business license application, the basis for its equal protection
claim, did not arise from protected activity. (See Shahbazian v.
City of Rancho Palos Verdes (2017) 17 Cal.App.5th 823, 836-837
[in analyzing a claim based on discriminatory governmental
action, the court must distinguish between challenges to
government decisions and statements that may have led to those
decisions].)

                                 7
action only if the cause of action (1) arises from an act in
furtherance of the right of petition or free speech ‘in connection
with a public issue,’ and (2) the plaintiff has not established ‘a
probability’ of prevailing on the claim”].)
       Pursuant to section 425.16, subdivision (e), 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’ 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.”
       In ruling on a special motion to strike under section 425.16,
the trial court engages in a now-familiar two-step process. “First,
the defendant must establish that the challenged claim arises
from activity protected by section 425.16. [Citation.] If the
defendant makes the required showing, the burden shifts to the
plaintiff to demonstrate the merit of the claim by establishing a
probability of success.” (Baral v. Schnitt (2016) 1 Cal.5th 376,
384; accord, Bonni v. St. Joseph Health System (2021) 11 Cal.5th
995, 1009 (Bonni); Park v. Board of Trustees of California State
University (2017) 2 Cal.5th 1057, 1061 (Park).)

                                 8
       “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.) Thus, “[t]he defendant’s first-step burden is
to identify the activity each challenged claim rests on and
demonstrate that that activity is protected by the anti-SLAPP
statute. 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.’” (Wilson v. Cable News Network, Inc. (2019)
7 Cal.5th 871, 884 (Wilson); see Bonni, supra, 11 Cal.5th at
p. 1009 [“[t]he defendant’s burden is to identify what acts each
challenged claim rests on and to show how those acts are
protected under a statutorily defined category of protected
activity”]; Park, at p. 1060.)
       “As to the second step inquiry, a plaintiff seeking to
demonstrate the merit of the claim ‘may not rely solely on its
complaint, even if verified; instead, its proof must be made upon
competent admissible evidence.’” (Sweetwater Union High School
Dist. v. Gilbane Building Co. (2019) 6 Cal.5th 931, 940;3 accord,
Monster Energy Co. v. Schechter (2019) 7 Cal.5th 781, 788.) “‘We
have described this second step as a “summary-judgment-like
procedure.” [Citation.] The court does not weigh evidence or
resolve conflicting factual claims. Its inquiry is limited to

3     Although the Supreme Court in Sweetwater Union High
School Dist. v. Gilbane Building Co., supra, 6 Cal.5th 931
referred generally to “competent admissible evidence,” the Court
held certain types of evidence, potentially admissible at trial but
not presented in admissible form, could be considered in
determining whether the plaintiff had demonstrated a probability
of success on the merits. (Id. at p. 949; see Sanchez v. Bezos
(2022) 80 Cal.App.5th 750, 770-779.)

                                  9
whether the plaintiff has stated a legally sufficient claim and
made a prima facie factual showing sufficient to sustain a
favorable judgment. 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.’” (Monster
Energy, at p. 788; see Taus v. Loftus (2007) 40 Cal.4th 683, 714
[the court should grant the section 425.16 motion “‘if, as a matter
of law, the defendant’s evidence supporting the motion defeats
the plaintiff’s attempt to establish evidentiary support for the
claim’”].)
       We review de novo an order granting or denying a special
motion to strike under section 425.16. (Wilson, supra, 7 Cal.5th
at p. 884; Park, supra, 2 Cal.5th at p. 1067.)
      2. From The Earth’s Cause of Action for Extortion Arose
         from Protected Speech or Petitioning Activity
       From The Earth’s cause of action for extortion is expressly
based on Penal Code section 523, which provides in
subdivision (a), “Every person who, with intent to extort property
or other consideration from another, sends or delivers to any
person any letter or other writing, whether subscribed or not,
expressing or implying, or adapted to imply, any threat such as is
specified in Section 519 is punishable in the same manner as if
such property or other consideration were actually obtained by
means of such threat.” (See Pen. Code, §§ 518 [“[e]xtortion is the
obtaining of property or other consideration from another, with
his or her consent . . . induced by a wrongful use of force or fear”],
519 [“[f]ear, such as will constitute extortion, may be inducted by
a threat,” including a threat “[t]o do an unlawful injury to the
person or property of the individual threatened or of a third
person”]; Flatley v. Mauro (2006) 39 Cal.4th 299, 326 [“‘the

                                  10
legislature in denouncing the wrongful use of fear as a means of
obtaining property from another had in mind threats to do the
acts specified in section 519, the making of which for the purpose
stated is declared to be a wrongful use of fear induced
thereby’”].)4
       From The Earth’s complaint alleged that Beltran’s offer of
his lobbying services included the threat that, if he was not
retained and paid as specified in his proposed contract, he would
ensure the City denied the licenses sought by From The Earth.
The credibility of this threat of interference in the approval
process, From The Earth further alleged, was demonstrated by
the City’s email, received immediately after Beltran sent the
proposed contract, that included Beltran as one of the addressees,

4      The court of appeal in Fuhrman v. California Satellite
Systems (1986) 179 Cal.App.3d 408, disapproved on another
ground in Silberg v. Anderson (1990) 50 Cal.3d 205, 217-218,
recognized the crime of extortion can form the basis for a civil
action in tort. “However denominated (e.g., extortion, menace,
duress), our Supreme Court has recognized a cause of action for
the recovery of money obtained by the wrongful threat of criminal
or civil prosecution. [Citations.] It is essentially a cause of action
for moneys obtained by duress, a form of fraud.” (Id. at p. 426;
see generally Rest.2d Torts, § 871 & com. a [“[o]ne who
intentionally deprives another of his legally protected property
interest or causes injury to the interest is subject to liability to
the other if his conduct is generally culpable and not justifiable
under the circumstances”; this rule “is applicable to duress in a
great variety of situations”].) Although Beltran argues From The
Earth has not adequately pleaded a cause of action for civil
extortion, he does not contend attempted extortion as defined in
the Penal Code is not a valid basis for a civil cause of action.

                                  11
thereby indicating Beltran had already communicated with the
City regarding the license application.
       Beltran’s communications to From The Earth in an attempt
to be retained to lobby in support of its license application (with
the alleged accompanying threats) are the wrong complained of,
not simply “evidence of liability or a step leading to some
different act for which liability is asserted.” (Park, supra,
2 Cal.5th at p. 1060.) Those efforts—an essential element of the
cause of action for civil extortion—are properly considered an
aspect of protected petitioning activity—statements made in
connection with an issue pending in an official proceeding within
the meaning of section 425.16, subdivision (e)(2). As alleged by
From The Earth, Beltran’s phone calls and emails all explained
how he could influence the City’s decision on the pending
application. Nothing more was needed for Beltran to make the
required first step showing. (Cf. Rand Resources, LLC v. City of
Carson, supra, 6 Cal.5th at p. 629 [lobbying “communications—
designed to influence the City’s renewal decision while the
renewal application [for a contract granting exclusive agency to
negotiate with the NFL regarding a stadium development] was
pending—are reasonably considered communications ‘in
connection with an issue under consideration or review by a
legislative . . . body’ within the meaning of subdivision (e)(2)”].)
       That “[e]xtortion is not a constitutionally protected form of
speech” (Flatley v. Mauro, supra, 39 Cal.4th at p. 328) and
Beltran’s actions were allegedly part of a collusive extortion
scheme with the City does not affect our first-step analysis. “If
conduct that supplies a necessary element of a claim is protected,
the defendant’s burden at the first step of the anti-SLAPP
analysis has been carried, regardless of any alleged motivations

                                 12
that supply other elements of the claim.” (Wilson, supra,
7 Cal.5th at p. 892 [concluding that “for anti-SLAPP purposes
discrimination and retaliation claims arise from the adverse
actions allegedly taken, notwithstanding the plaintiff’s allegation
that the actions were taken for an improper purpose”].)
       To be sure, as From The Earth argues, the Supreme Court
in Flatley v. Mauro, supra, 39 Cal.4th at page 320 held a
defendant may not use section 425.16 to strike an action based on
speech or petitioning activity that is illegal. But this exception
applies at the first step only if “the defendant concedes, or the
evidence conclusively establishes, that the assertedly protected
speech or petition activity was illegal as a matter of law.”
(Flatley, at p. 320; accord, City of Montebello v. Vasquez (2016)
1 Cal.5th 409, 424; Towner v. County of Ventura (2021)
63 Cal.App.5th 761, 771.) That is not the case here. Far from
admitting his conduct was illegal, Beltran has expressly denied
he made the threatening statements described in Patel’s
declaration.
      3. From The Earth Has Demonstrated a Probability of
         Prevailing on the Merits of Its Cause of Action for
         Extortion
      To prevail at the second step of a special motion to strike,
the plaintiff need present evidence that satisfies “only ‘a
minimum level of legal sufficiency and triability.’” (Jarrow
Formulas, Inc. v. LaMarche (2003) 31 Cal.4th 728, 738.) From
The Earth unquestionably demonstrated the requisite minimal
merit of its claim against Beltran.5

5    Even though the trial court did not reach the question
whether From The Earth had established the necessary
minimum probability of prevailing on the merits, because review

                                 13
       Extortion “requires an unlawful use of force or fear with
the intent of achieving a further consequence, the inducement of
another person to consent to the actor’s obtaining the other’s
property.” (People v. Hesslink (1985) 167 Cal.App.3d 781, 789-
790; see People v. Sales (2004) 116 Cal.App.4th 741, 749 [“[t]he
elements of the crime of attempted extortion are (1) a specific
intent to commit extortion and (2) a direct ineffectual act done
towards its commission”]; see generally CALCRIM No. 1830.)
       From The Earth presented evidence (Patel’s declaration
and attached exhibits) that Beltran threatened to ensure the
denial of the company’s cannabis license application unless From
The Earth retained him as a lobbyist to assist in the application
process—a threat that was reinforced by the City’s November 30,
2018 email that indicated Beltran had already been in contact
with the City regarding the application. Beltran’s actions, if
proved at trial, would support a finding of attempted extortion
under Penal Code sections 518, 519 and 523. Accepting this
evidence as true, as we must when evaluating a section 425.16
special motion to strike, From The Earth has stated a legally
sufficient claim and made a prima facie factual showing sufficient
to sustain a favorable judgment.
       Beltran’s response is insufficient to defeat From The
Earth’s evidentiary showing. His denial that he made
threatening statements suggesting unlawful interference with
the City’s evaluation of From The Earth’s license application if he
was not retained as a lobbyist, as described by Patel, of course,
merely established a conflict that cannot be resolved at this stage

on appeal is de novo, we properly address the issue. (Roberts v.
Los Angeles County Bar Assn. (2003) 105 Cal.App.4th 604, 615-
616.)

                                14
of the proceedings. Similarly, although Beltran’s specific intent
to commit extortion, an element of the crime, was not established
by Patel’s declaration, it may be reasonably inferred from the
statements and conduct attested to by Patel, at least for purposes
of establishing the extortion claim’s minimal merit. Finally,
whether or not Beltran is correct that his communications with
the City concerning cannabis licenses are privileged under Civil
Code section 47, subdivision (b), From The Earth’s cause of action
is predicated on the decidedly unprivileged statements and
emails between Beltran and Patel and the subsequent action by
the City in denying From The Earth’s application for commercial
cannabis licenses.
                         DISPOSITION
      The order denying Beltran’s special motion to strike is
affirmed. From The Earth is to recover its costs on appeal.

                                     PERLUSS, P. J.

      We concur:

      SEGAL, J.                      FEUER, J.

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