Court Opinion

ID: 9297488
Source: CourtListenerOpinion
Date Created: 2022-11-30 19:01:28.156846+00
Date Added: 2024-06-11T17:13:27.392945
License: Public Domain

Filed 11/30/22
                 CERTIFIED FOR PUBLICATION

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

                 SECOND APPELLATE DISTRICT

                        DIVISION EIGHT

 JASON FLICKINGER,                     B322736

        Plaintiff and Respondent,      Santa Clara County
                                       Super. Ct. No. 19CV355773
        v.

 GORDON J. FINWALL,

        Defendant and Appellant.

      APPEAL from an order of the Superior Court of Santa
Clara County. Christopher G. Rudy, Judge. Reversed and
remanded with instructions.

     Murphy, Pearson, Bradley & Feeney, Jonathan M. Blute
and Jackson L. Stogner for Defendant and Appellant.

     Gates Eisenhart Dawson, Marc A. Eisenhart, James L.
Dawson, Steven D. McLellan and Claire A. Melehani for Plaintiff
and Respondent.
                ___________________________
       This is an appeal from an order denying defendant
Gordon J. Finwall’s motion to strike plaintiff Jason Flickinger’s
causes of action against him pursuant to the anti-SLAPP statute,
section 425.16 of the Code of Civil Procedure.1 There is no
dispute that defendant’s underlying conduct was in furtherance
of petitioning activity within the meaning of section 425.16,
subdivision (b)(1). But the trial court concluded defendant’s
prelitigation letter responsive to a demand from plaintiff’s
counsel amounted to extortion as a matter of law so as to deprive
it of section 425.16 protection under Flatley v. Mauro (2006)
39 Cal.4th 299, 320 (Flatley).
       We interpret Flatley as holding an attorney’s prelitigation
communication is extortion as a matter of law only where the
attorney’s conduct falls entirely outside the bounds of ordinary
professional conduct. We find that defendant’s letter falls within
the boundaries of professional conduct and therefore the Flatley
exception to anti-SLAPP protection does not apply. We therefore
conclude that defendant made a prima facie showing under the
first prong of the anti-SLAPP analysis.
       Even though the trial court declined to reach it, we exercise
our discretion to consider the second prong of the anti-SLAPP
analysis and conclude that plaintiff failed to meet his burden to
show a probability of prevailing on his causes of action. The sole
cause of action that plaintiff defends on appeal is for civil
extortion. We agree with defendant that the litigation privilege
defeats this cause of action.
       Accordingly, we reverse the order of the trial court and
remand with instructions to grant defendant’s motion and award

1     SLAPP is the acronym for “strategic lawsuit against public
participation.” All further undesignated statutory references are
to the Code of Civil Procedure.

                                 2
defendant fees and costs pursuant to section 425.16,
subdivision (c)(1).
                           BACKGROUND
       Plaintiff is a homeowner. In 2014 he engaged a contractor,
Robert Pendergrast, to remodel or otherwise improve various
parts of his property. In early 2015, after Pendergrast had
already done extensive work on the home, he agreed to remodel
plaintiff’s kitchen for an additional $60,000 in cash.
       Several months later, while the kitchen work was still
ongoing, plaintiff had Pendergrast over one evening for a social
visit. During the visit, plaintiff, while “very drunk,” confided to
Pendergrast that plaintiff had gotten the cash to fund the
remodeling project illegally. Plaintiff, who was an employee of
Apple, told Pendergrast he had taken kickbacks from Apple
vendors while on business in China. Despite this, Pendergrast
continued working for plaintiff.
       A month or so later, in early 2016, Pendergrast observed
plaintiff in his living room counting what Pendergrast estimated
to be $1 million in cash. Pendergrast still continued working for
plaintiff.
       In March 2016, plaintiff gave Pendergrast $900 in cash and
asked him to buy computer equipment with it, ostensibly as part
of the remodeling project. To Pendergrast, the request seemed
like an effort to further involve Pendergrast in plaintiff’s money
laundering scheme. Upset, Pendergrast walked off the job,
leaving plaintiff’s kitchen in a state of disarray.
       According to plaintiff’s declaration, Pendergrast told
plaintiff upon leaving that there were “a lot of electrical things he
did to [plaintiff’s] house that only [Pendergrast] kn[ew] about and
[plaintiff] need[ed] to pay him to fix them.” After plaintiff
demanded to see building permits that Pendergrast had not
obtained, things got worse. Plaintiff threatened to “report”

                                 3
Pendergrast, and Pendergrast responded with a threat to expose
compromising photographs of plaintiff with a colleague.
       About three months later, Pendergrast left plaintiff a
voicemail—plaintiff does not say what prompted it or what had
transpired in the intervening months—reiterating that he “[had]
pictures” and further stating he was “working with somebody for
Apple with the fraud department,” adding, among other things,
“don’t f*** with me.” Nonetheless, plaintiff invited Pendergrast
to his house two days later to discuss the work that remained
unfinished in his home. Plaintiff does not say whether that
meeting occurred. If it did, it failed to resolve things between the
men.
       About six months later, plaintiff, through counsel, made a
demand on Pendergrast for $125,000, presumably representing
his claimed cost to finish the remodeling work. On December 14,
2016, Pendergrast responded through counsel—defendant
herein—in a letter rejecting the demand. After cataloging other
complaints plaintiff had already made against Pendergrast—with
the California Labor Commissioner and the Contractors State
License Board—defendant’s letter turned to the merits of
plaintiff’s threatened litigation:
       “[Y]ou mention that Mr. Pendergrast was involved in
construction activities at [plaintiff’s] home. However,
Mr. Pendergrast was not operating as a general contractor and
[plaintiff] made his own decision to not pull permits. . . . The
relationship ended when Mr. Pendergrast determined it was
likely that [plaintiff] was laundering ill-gotten money obtained
while in the employ of Apple. [¶] I am not sure how you came up
with the figure of $125,000. This outrageous demand appears
like a threat to further torment Mr. Pendergrast by all means
possible, and [plaintiff] has already made retaliatory claims to
the Labor Commissioner and [Contractors State License Board]

                                 4
and now he makes another one through you. If [plaintiff]
initiates litigation, Mr. Pendergrast’s position will not change
and he will aggressively defend himself. I suggest you discuss
with [plaintiff] how such litigation may result in Apple opening
an investigation into [plaintiff’s] relationships with vendors.”
       The lawyers’ exchange did not lead to a settlement.
Plaintiff sued Pendergrast in Santa Clara Superior Court in
2017, commencing what we call Flickinger I. (Flickinger v.
Pendergrast (Super. Ct. Santa Clara County, 2019,
No. 17CV306836).)
1.     Flickinger I
       Plaintiff asserted just one cause of action—breach of
contract—against Pendergrast in Flickinger I. One aspect of the
alleged breach was that Pendergrast agreed, but failed, to obtain
building permits for plaintiff’s kitchen remodel. Pendergrast’s
defenses relied in large part on the allegation, previewed in
defendant’s December 2016 letter, that plaintiff told him not to
obtain permits. In a signed interrogatory response, Pendergrast
stated: “[Plaintiff] advised [Pendergrast] not to obtain a building
permit for the kitchen remodel. [Plaintiff] did not want a permit
because he did not want a public record of his expenditures as he
was spending beyond his means. While on company business for
Apple in China, he had received large illegal under the table cash
payments from an Apple vendor and carried the cash,
unreported, back to the United States. He was using the ill-
gott[e]n cash to pay [Pendergrast] and other expenses.”
       Defendant sought to substantiate these allegations through
discovery. He deposed plaintiff, asking a number of questions
about his Apple-related overseas vendor contacts. Plaintiff
refused to answer these questions based on his Fifth Amendment
right against self-incrimination. Defendant then subpoenaed
Apple for records relevant to plaintiff’s dealings with Apple

                                 5
vendors. Apple objected on relevance grounds. Defendant met
and conferred with Apple’s counsel, explaining the relationship
between Pendergrast’s unclean hands defense and plaintiff’s
work for Apple. When his explanation failed to persuade Apple to
turn over any records, defendant dropped the matter and stopped
communicating with Apple.
       Even without the Apple documents, defendant prepared
and submitted a proposed statement of decision for Pendergrast
in Flickinger I alluding to the kickback allegations. This
included the proposed factual finding that “[w]hile [Pendergrast]
had obtained a building permit for the 2014 home addition
project, [plaintiff] instructed [Pendergrast] not to obtain a permit
for the kitchen remodel. [Plaintiff] informed [Pendergrast] at the
outset that he did not want a permit so as not to create a public
record of spending beyond his means.” He then referred back to
this fact in support of the affirmative defenses of illegality
unclean hands, equitable estoppel, and waiver.
       The Flickinger I trial court ruled in favor of plaintiff. In
explaining the basis for its decision,2 it repeatedly addressed
disputed facts about why there were no building permits for
plaintiff’s kitchen remodel. For example, it summarized
plaintiff’s testimony regarding the key elements of the contract
between plaintiff and Pendergrast as follows: “(1) [Pendergrast]
was to complete all work up to code, (2) [Pendergrast] was to
obtain all necessary permits and inspections, and
(3) [Pendergrast] was to complete the work in a workmanlike

2     We grant plaintiff’s request for judicial notice, which
includes the statement of decision by the Flickinger I court.
Defendant did not oppose plaintiff’s request and we agree with
plaintiff that the trial court below relied in part on the
Flickinger I court’s analysis in rendering its decision, even
though the analysis was not formally made part of the record.

                                 6
manner.” (Italics added.) At the same time, it recognized
Pendergrast’s assertion that “[p]laintiff did not obtain permits so
as to hide the expenditure of cash for home improvements [and]
acted in a deliberate way to prevent a public record of his
spending.”
       Without resolving the factual conflict, the Flickinger I trial
court laid the blame for not getting permits with Pendergrast
based on his status as a licensed professional. It deemed—
without citation to on-point authority—Pendergrast’s failure a
breach as a matter of law without regard to any terms of the
actual agreement between the parties. The court rejected
Pendergrast’s affirmative defenses of unclean hands, equitable
estoppel, and waiver. It relied on Pendergrast’s status as a
licensed professional to reject his arguments that plaintiff bore
some responsibility for the lack of permits because plaintiff had
instructed Pendergrast not to get them. Again, the trial court
cited no on-point authority for the proposition that plaintiff’s
instruction to Pendergrast not to get permits, if proven, was
irrelevant as a matter of law to his defenses.
       The court imposed on Pendergrast the costs of completing
the job as fully permitted and inspected, including the costs of
removing walls and other demolition that was necessary to allow
inspection of Pendergrast’s work. It awarded plaintiff a total of
$169,000 in general damages.
       Defendant represents, and plaintiff does not dispute, that
at no point in Flickinger I was there any allegation by plaintiff or
finding by the court of bad faith or abuse of process with respect
to defendant asserting affirmative defenses related to plaintiff’s
illegal funding for the project, nor for asking plaintiff about the
funding in his deposition, nor for seeking discovery from Apple.

                                  7
2.     Flickinger II
       While Flickinger I was still pending, plaintiff filed a second
action relating to other work Pendergrast did on his home, this
time suing both Pendergrast and defendant. This appeal arises
from this second action. Only plaintiff’s causes of action against
defendant are relevant to this appeal. These are (1) civil
extortion, and (2) violation of the Ralph Civil Rights Act, Civil
Code section 52. Each is based on allegations that defendant
“used threats, intimidation, and coercion to prevent [p]laintiff
from filing [Flickinger I]” based on defendant’s December 2016
letter to plaintiff’s counsel responding to his prelitigation
demand.
       Defendant filed an anti-SLAPP motion to strike plaintiff’s
causes of action and plaintiff opposed it. The trial court denied
defendant’s motion on the basis that defendant’s December 2016
letter amounted to extortion and was therefore unprotected
activity under Flatley, supra, 39 Cal.4th 299.
       Defendant timely appealed pursuant to section 904.1,
subdivision (a)(13).
                            DISCUSSION
1.     Standard of Review
       We review a trial court’s order granting an anti-SLAPP
motion de novo, considering the pleadings and affidavits
submitted in support of, or in defense to, the subject claims.
(Verceles v. Los Angeles Unified School District (2021)
63 Cal.App.5th 776, 785.)
2.     Overview of the Anti-SLAPP Statute
       The anti-SLAPP statute provides a mechanism for early
assessment of claims implicating certain protected speech
activities. Qualifying claims found to be without merit must be
stricken and costs and expenses awarded to the defendant.
(§ 425.16, subd. (c)(1).) This relieves defendants wrongfully sued

                                  8
for engaging in protected activities of the time and expense of
litigation.
       The statute imposes on the defendant an initial burden to
show the challenged claims qualify for protection under the
statute. (§ 425.16, subd. (b)(1).) If the defendant satisfies this
burden, the plaintiff then bears the burden to establish a
probability of prevailing on the challenged claims. (Ibid.)
       The statute applies only to claims “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.” (§ 425.16,
subd. (b)(1).) Such acts are broken into four illustrative
categories of conduct in section 425.16, subdivision (e).
       Due to the important interests it seeks to protect, the
Legislature commands that we construe the anti-SLAPP statute
broadly. (§ 425.16, subd. (a); Navellier v. Sletten (2002)
29 Cal.4th 82, 92.) However, “not all speech or petition activity is
protected by section 425.16.” (Flatley, supra, 39 Cal.4th at
p. 313.) Of relevance here, section 425.16 does not protect
“speech or petition activity that [i]s illegal as a matter of law.”
(Flatley, at p. 320.) We refer to this exception as the “Flatley
exception.” As further discussed below, the Flatley exception
applies only in “narrow circumstance[s]” where “either the
defendant concedes, or the evidence conclusively establishes”
illegality as a matter of law. (Id. at pp. 316, 320.)
3.     Analysis
       We first consider whether defendant’s December 2016
letter responding to a prelitigation demand from plaintiff’s
counsel is protected under section 425.16. We conclude that it is,
and then proceed to consider whether plaintiff met his burden to
show a likelihood of prevailing on the merits. We are entitled to
do so even though the trial court did not consider the probability

                                 9
that plaintiff could prove his claims. (Hecimovich v. Encinal
School Parent Teacher Organization (2012) 203 Cal.App.4th 450,
468.)
        a.     The December 2016 letter was protected
               petitioning activity
        Section 425.16 protects any conduct in furtherance of the
exercise of the constitutional right of petition. (Id., subd. (e)(4).)
Prelitigation communications may qualify for this protection so
long as they “ ‘concern[] the subject of the dispute’ and [are] made
‘in anticipation of litigation “contemplated in good faith and
under serious consideration . . . .” ’ ” (Neville v. Chudacoff (2008)
160 Cal.App.4th 1255, 1268.)
        There is no dispute that defendant’s December 2016 letter
satisfies these preliminary requirements. It was written in
response to a prelitigation demand from plaintiff’s counsel and
previewed Pendergrast’s litigation posture.
        The parties dispute whether defendant’s statement that
“such litigation may result in Apple opening an investigation into
[plaintiff’s] relationships with vendors” and corresponding
reference to “ill-gotten money obtained while in the employ of
Apple” triggers the Flatley exception, taking it outside the
protection of section 425.16.
        According to plaintiff, this statement is “textbook” extortion
so the Flatley exception applies. Extortion includes “the
obtaining of property or other consideration from another, with
his . . . consent . . . , induced by a wrongful use of force or
fear . . . .” (Pen. Code, § 518, subd. (a).) What constitutes a
wrongful use of force or fear for these purposes is defined in
Penal Code section 519 (People v. Beggs (1918) 178 Cal. 79, 83–
84), and includes “a threat . . . . [¶] [t]o expose, or to impute to
[the person threatened a] disgrace, or crime . . . ” (Pen. Code,
§ 519).

                                 10
       According to defendant, his statement was a permissible
threat under Malin v. Singer (2013) 217 Cal.App.4th 1283
(Malin), which recognized that certain threats to disclose
information in litigation do not amount to extortion as a matter
of law. (Id. at pp. 1298–1299.)
       We discuss these authorities at some length below.
               i. Flatley
       Flatley, a celebrity dancer, sued Mauro, an attorney, under
various tort theories based on a letter Mauro sent to Flatley and
telephone conversations Mauro had with Flatley’s counsel.
(Flatley, supra, 39 Cal.4th at p. 305.) The question before the
Supreme Court was whether Mauro’s communications to Flatley
and his counsel were protected under the anti-SLAPP statute.
(Flatley, at p. 305.)
       Mauro sent the letter to Flatley on behalf of his client who
claimed her sexual encounter with Flatley in a Las Vegas hotel
was nonconsensual. (Flatley, supra, 39 Cal.4th at p. 305.) The
letter was sensational, plainly designed to shock Flatley into
submission and a large settlement. Among other things, it
accused Flatley of rape, referenced a police report that evidence
later showed was a sham, discussed the prospect of punitive
damages to “ ‘send[] a message,’ ” referred to a recent
$100 million punitive damages award made in another case, and
emphasized that Flatley’s personal assets were in peril. (Id. at
p. 308.) In a follow-up call with Flatley’s lawyer, Mauro
demanded at least $1 million to settle. (Id. at pp. 311, 329.)
       The letter further contained specific threats to distribute
information about Flatley outside the confines of the threatened
litigation absent a settlement. First, it threatened to use the
press to generate negative publicity around Flatley. Mauro listed
not fewer than 18 news sources that would receive a press release
at the time of suit. (Flatley, supra, 39 Cal.4th at pp. 329, 339.)

                                11
In a follow-up call with Flatley’s lawyer, Mauro elaborated that
he “ ‘already ha[d] the news media lined up’ and would ‘hit
[Flatley] at every single place he tours.’ ” (Id. at p. 310.) Second,
it threatened to use information obtained in discovery to expose
any illegality—including “ ‘violation[s] of any U.S. Federal,
Immigration, I.R.S., S.S. Admin., U.S. State, Local,
Commonwealth U.K., or International Laws’ ”—to “ ‘any and all
appropriate authorities.’ ” (Id. at p. 309, boldface omitted.)
       Even the letter’s formatting was outrageous, prompting the
Supreme Court to take the unusual step of appending it to its
opinion. (Flatley, supra, 39 Cal.4th at p. 307 & fn. 5.)
       On these facts, the Flatley court found that Mauro’s letter
and subsequent telephone calls to Flatley’s attorneys constituted
extortion as a matter of law and therefore were not protected
under section 425.16. (Flatley, supra, 39 Cal.4th at p. 328.) This
conclusion rested on five aspects of Mauro’s conduct.
       First, Mauro’s letter contained accusations of criminal
conduct which he threatened to expose directly “to the
‘worldwide’ media,” not merely indirectly as a result of
commencing litigation. (Flatley, supra, 39 Cal.4th at p. 330.)
Second, his threat to expose “criminal activity entirely unrelated
to any alleged injury suffered by [his] client ‘exceeded the limits
of [his] representation of his client’ [which was] itself evidence of
extortion.” (Id. at pp. 330–331.) Third, the Supreme Court found
the threat of a rape allegation was extortion based on evidence
that Mauro’s client’s initial police report was devoid of content
and merely a sham designed to “hold a police investigation over
Flatley’s head.” (Id. at pp. 331–332.) Fourth, Mauro threatened
that Flatley’s bad acts referenced in his letter “were ‘just the
beginning,’ ” suggesting that “Flatley would be exposed to various
kinds of opprobrium and he would be disgraced thereby unless he
met Mauro’s demands.” (Id. at p. 332.) Fifth, and finally, in his

                                 12
follow-up calls to Flatley’s counsel, “Mauro did not discuss the
particulars of the claim or show an interest in negotiations.”
(Ibid.) Rather, he simply reiterated his demand for payment and
beat the drum of the consequences if Flatley refused to
capitulate: Mauro would “ ‘go public’ and ‘ruin’ Flatley . . . .”
(Ibid.)
       The Flatley court went to great lengths to limit the scope of
the crime-as-a-matter-of-law exception to section 425.16
protection. It explained that its “conclusion that Mauro’s
communications constituted criminal extortion as a matter of law
[was] based on the specific and extreme circumstances of th[e]
case” and cautioned that its “discussion of what extortion as a
matter of law is [was] limited to the specific facts of th[e] case.”
(Flatley, supra, 39 Cal.4th at p. 332, fn. 16.) It further cautioned
that its analysis did not render “rude, aggressive, or even
belligerent prelitigation negotiations, whether verbal or written,
that may include threats to file a lawsuit, report criminal
behavior to authorities or publicize allegations of wrongdoing,”
extortion per se. (Ibid.) Rather, petitioning activity can be
criminal extortion as a matter of law for purposes of the Flatley
exception only in the “narrow circumstance” where “the
defendant concedes the illegality of [his] conduct or the illegality
is conclusively shown by the evidence . . . .” (Id. at p. 316.)
              ii. Malin
       Malin, a restauranteur, sued Singer, an attorney, under
various tort theories based on a letter Singer sent to Malin.
(Malin, supra, 217 Cal.App.4th at pp. 1287–1288, 1290.) The
question on appeal, like in Flatley, was whether Singer’s letter
was protected under the anti-SLAPP statute. (Malin, at p. 1287.)
       Singer sent the letter on behalf of his client, a business
partner of Malin’s, who claimed Malin had misappropriated
assets from a company they co-owned. The letter attached a copy

                                13
of a proposed complaint and demanded a resolution of the matter
“to [Singer’s] client’s satisfaction within five (5) business days
from [Malin’s] receipt of [the letter].” (Malin, supra,
217 Cal.App.4th at p. 1289.) Importantly, the draft complaint
contained allegations that Malin used the misappropriated funds
to arrange sexual encounters with various partners but left blank
their names. In the demand letter, Singer explained: “ ‘I have
deliberately left blank spaces in portions of the Complaint
dealing with your using company resources to arrange sexual
liaisons with older men such as “Uncle Jerry,” Judge [name
redacted], a/k/a “Dad” (see enclosed photo), and many others.
When the Complaint is filed with the Los Angeles Superior
Court, there will be no blanks in the pleading.’ ” (Ibid., italics
omitted.)
       The Malin court determined that the Flatley exception did
not apply and Singer was entitled to invoke the protection of
section 425.16. It reached this conclusion because “Singer’s
demand letter did not expressly threaten to disclose Malin’s
alleged wrongdoing to a prosecuting agency or the public at
large.” (Malin, supra, 217 Cal.App.4th at p. 1298.) The court
reasoned that the secret that would “expose” Malin to “disgrace”
for purposes of the extortion statute was “inextricably tied to
[Singer’s client’s] pending complaint. The demand letter accused
Malin of embezzling money and simply informed [Malin] that
[Singer’s client] knew how [Malin] had spent those funds.” (Id. at
p. 1299.)
       In summarizing its conclusion, the Malin court
distinguished Flatley and another case as follows: “We see a
critical distinction between Singer’s demand letter, which made
no overt threat to report Malin to prosecuting agencies or the
Internal Revenue Service, and the letters in Flatley and Mendoza
[v. Hamzeh (2013) 215 Cal.App.4th 799], which contained those

                               14
express threats and others that had no reasonable connection to
the underlying dispute.” (Malin, supra, 217 Cal.App.4th at
p. 1299.)
             iii. Why the Flatley exception does not apply
       We agree with defendant that the Flatley exception does
not apply to the facts of this case. Defendant’s letter bears no
resemblance to the “extreme” conduct in Flatley which warranted
a “narrow” exception to the protections ordinarily accorded
petitioning activities under section 425.16. (Flatley, supra,
39 Cal.4th at pp. 316, 332, fn. 16.)
       Flatley recognized that not every threat by an attorney to
settle or be sued is extortion. (Flatley, supra, 39 Cal.4th at
pp. 316, 332, fn. 16.) We read Flatley as permitting a finding of
extortion as a matter of law only where an attorney’s threats fall
wholly outside the bounds of professional norms.
       Central to the Flatley court’s concerns was that Mauro
threatened to use information obtained through litigation to
report criminal activities “entirely unrelated” to his client’s
claims to any applicable prosecuting agencies. (See Flatley,
supra, 39 Cal.4th at pp. 330–331.) The court had earlier observed
that threatening criminal charges to gain an advantage in a civil
dispute is proscribed by the Rules of Professional Conduct in both
California and Mauro’s licensing state of Illinois. (See Flatley, at
p. 327 & fn. 14.) His threat therefore “ ‘exceeded the limits of
[his] representation of his client’ [which was] itself evidence of
extortion.” (Id. at pp. 330–331.)
       The Flatley court could have, but did not, limit its analysis
to the fact that the threat was itself a breach of ethical rules.
Instead, informed by judicial knowledge of ordinary attorney
behavior, the Flatley court took pains to highlight Mauro’s
behavior that was entirely out of the ordinary. For example, it
stressed Mauro’s threat to not only burden Flatley with court

                                15
proceedings but with a lifetime of torment: he promised Flatley
negative publicity “ ‘every place he [went] for the rest of his life.’ ”
(Flatley, supra, 39 Cal.4th at p. 330.) Further, it noted Mauro’s
mode of negotiating fell outside of professional norms. He
focused exclusively on extracting an offer of “ ‘sufficient
payment,’ ” rather than engaging on the merits or particulars of
his client’s claims. (Id. at p. 332.) He set a settlement deadline
four weeks out but then threatened to withdraw it eight days
later if his phone call was not returned in 30 minutes. (Id. at
p. 330.) And even his presentation in the initial demand letter—
riddled with typos and produced with “various font sizes, boldface
type, capital letters, underlining, and italics” reminiscent more of
a Hollywood ransom note than professional correspondence—
factored in the court’s analysis. (Id. at p. 307.)
       Defendant’s conduct here stands in stark contrast to
Mauro’s in Flatley. Defendant’s purportedly criminal
communication was his December 2016 letter, sent to plaintiff’s
counsel and not to plaintiff directly, in response to a demand
from plaintiff’s counsel. In it, defendant addressed the merits of
plaintiff’s claims and offered facts relevant to his client’s claimed
lack of liability. He made no threat to report plaintiff to any
prosecuting authorities. His only express “threat” was that his
client, Pendergrast, would “aggressively defend himself” in
litigation. The statement from which plaintiff and the trial court
implied a further threat—defendant’s suggestion that plaintiff’s
counsel advise plaintiff about how litigation “[could] result in
Apple opening an investigation into [plaintiff’s] relationships
with vendors”—is not a threat that Pendergrast would report
plaintiff to prosecuting authorities, and it does not lie so far
outside the bounds of professional communication to amount to
criminal extortion as a matter of law.

                                  16
       Defendant states by declaration that his reference to Apple
in the December 2016 letter was meant at face value—that public
litigation and civil discovery could lead to Apple learning of
Pendergrast’s kickback allegations and initiating an
investigation. Although plaintiff says he understood it as a
threat to go accuse him of a crime, his subjective and self-serving
interpretation cannot establish extortion as a matter of law. (See
Cross v. Cooper (2011) 197 Cal.App.4th 357, 387.)
       Plaintiff urges us to read Malin as protecting only threats
to make allegations in a complaint that are “inextricably tied” to
the complaint’s causes of action, and argues that the illegal
kickback and money laundering defendant suggested would be
exposed if plaintiff sued Pendergrast were not even “reasonably
connect[ed]” to the parties’ dispute. We disagree with both the
legal and factual premises of plaintiff’s argument.
       It is true that the Malin court called the allegations of
Malin’s sexual activity Singer threatened to disclose in litigation
“inextricably tied” to the underlying causes of action. (Malin,
supra, 217 Cal.App.4th at p. 1299.) But in doing so, the court
suggested a standard that only required them to be “reasonabl[y]
connect[ed]” to be eligible for protection under section 425.16.
(Malin, at p. 1299.) We agree with the Malin court’s suggested
standard. In so agreeing, we note our disagreement that the
threat in Malin to name socially prominent sexual partners,
complete with pet names, age differences, and gender was
“inextricably tied” to the allegations that Malin had
misappropriated company assets. (Ibid.) Though the question is
not before us, we disagree that these allegations were even
reasonably connected to the plaintiff’s underlying claims, and
think the trial court was correct in deeming these same
allegations “ ‘very tangential to the causes of action in
Defendants’ complaint’ ” and not subject to protection under

                                17
section 425.16. (Malin, at p. 1292, italics added.) Room for such
disagreement is perhaps inevitable where the inquiry is, per
Flatley, entirely fact specific.
       The reasonably connected standard is consistent with
Flatley, where the court singled out as extortion Mauro’s threats
to disclose information “entirely unrelated” to his client’s claimed
harms. (Flatley, supra, 39 Cal.4th at pp. 330–331.) A threat that
is “entirely unrelated” to the merits of the disputed claims is not
“reasonably connected” to the actionable conduct. But a threat
does not have to be “inextricably tied” to the merits to avoid a
finding it is “entirely unrelated.”
       An “inextricably tied” standard would encourage attorneys
to withhold from prelitigation communications a complete picture
of what their litigation strategy would be. There is no
requirement that pleadings be limited to only those allegations
that are “inextricably tied” to the underlying cause of action.
Attorneys may, and frequently do, include in complaints
allegations that are not essential to, but bear a reasonable
connection to, the causes of action in order to provide helpful
color. Put another way, this is within the realm of ordinary
professional conduct in litigation. As defendant explains, “it is
not improper for an attorney to warn his opponent of potential
adverse consequences of litigation[; n]or is there anything
improper about leveraging those potential consequences in an
effort to dissuade one’s opponent from filing suit.” A rule that
would discourage counsel from engaging in an open prelitigation
exchange of strategies or draft pleadings would make settlements
more difficult to achieve. This would contravene the “well-
established public policy in this state that settlements of
litigation are favored and should be encouraged.” (Villa v. Cole
(1992) 4 Cal.App.4th 1327, 1338.)

                                18
       Applying the rule here, we view defendant’s implied threat
to make public allegations that plaintiff was involved in illegal
kickback schemes and money laundering as reasonably connected
to the parties’ dispute. As explained above, plaintiff claimed in
Flickinger I that Pendergrast breached his contract with plaintiff
by failing to get permits for the kitchen work on plaintiff’s house.
According to plaintiff, Pendergrast had expressly agreed to get
such permits. But Pendergrast’s position was that there was no
breach in this regard because plaintiff agreed Pendergrast would
not get permits—because plaintiff did not want a public record of
his spending above his legal means.
       With contradictory testimony about why no permits were
obtained, Pendergrast’s explanation as to why plaintiff allegedly
told him not to get permits bore a reasonable connection to the
parties’ dispute. Pendergrast acknowledged that his failure to
obtain permits “can cause disciplinary problems with the
[Contractors State License Board],” but argued that “when a
homeowner directs a contractor not to get a permit and the
contractor moves forward in reliance on that direction and
decision, the homeowner is barred from later arguing that the
contractor should have obtained the permit anyway.”
       The Flickinger I court found Pendergrast “breached the
contract by failing to obtain all the necessary permits and
inspections” without deciding whether plaintiff and Pendergrast
agreed there would be no permits. Rather, it implied
Pendergrast’s agreement to obtain permits in the contract as a
matter of law—any contrary agreement notwithstanding—based
on his status as a professional contractor. But there was no
suggestion that defendant arguing the parties had agreed not to
get permits (and alleging the underlying reasons for that
agreement) was in bad faith.

                                19
       As already noted, the Flickinger I court’s analysis cited no
direct authority that Pendergrast’s license status implied in his
contract a promise to get permits even if the parties expressly
agreed he would not. The apparent lack of authority on the topic,
and the materiality of the issue, gave defendant leeway—and
perhaps an obligation—to advance the position most favorable to
his client. (See § 128.7, subd. (b)(2) [claims, defenses, and legal
contentions in written submissions to court must only be
“warranted by existing law or by a nonfrivolous argument for the
extension, modification, or reversal of existing law or the
establishment of new law”]; Rules Prof. Conduct, rule 1.3
[imposing limited “reasonable diligence” obligation on attorneys,
defined to include “act[ing] with commitment and dedication to
the interests of the client”].) Defendant’s warning in his
December 2016 letter that he intended to do so was within the
bounds of professional conduct and therefore not extortion as a
matter of law.
       b.    Plaintiff cannot demonstrate a likelihood of
             success on the merits
       Plaintiff has forfeited his Ralph Act cause of action on
appeal by failing to respond to defendant’s arguments that it
lacks merit. The trial court will dismiss this cause of action on
remand. Accordingly, we consider only whether the record shows
plaintiff has a probability of prevailing on his civil extortion
cause of action. It does not.
       A plaintiff cannot show a probability of prevailing on the
merits of a cause of action for anti-SLAPP purposes where the
cause of action is barred by the litigation privilege codified in
Civil Code section 47. (Flatley, supra, 39 Cal.4th at p. 323;
Digerati Holdings, LLC v. Young Money Entertainment, LLC
(2011) 194 Cal.App.4th 873, 887 (Digerati).) “The litigation
privilege precludes liability arising from a publication or

                                20
broadcast made in a judicial proceeding or other official
proceeding. ‘ “The usual formulation is that the privilege applies
to any communication (1) made in judicial or quasi-judicial
proceedings; (2) by litigants or other participants authorized by
law; (3) to achieve the objects of the litigation; and (4) that [has]
some connection or logical relation to the action.” [Citation.] The
privilege “is not limited to statements made during a trial or
other proceedings, but may extend to steps taken prior thereto, or
afterwards.” [Citation.]’ [Citation.] The litigation privilege is
interpreted broadly in order to further its principal purpose of
affording litigants and witnesses the utmost freedom of access to
the courts without fear of harassment in derivative tort actions.
[Citation.] The privilege is absolute and applies regardless of
malice.” (Digerati, at pp. 888–889, fn. omitted.)
       “A prelitigation communication is privileged only if it
‘relates to litigation that is contemplated in good faith and under
serious consideration’ [citation] . . . . The requirement of good
faith contemplation and serious consideration provides some
assurance that the communication has some ‘ “ ‘ connection or
logical relation’ ” ’ to a contemplated action and is made ‘ “ ‘to
achieve the objects’ ” ’ of the litigation. [Citation.] ‘Whether a
prelitigation communication relates to litigation that is
contemplated in good faith and under serious consideration is an
issue of fact.’ ” (Digerati, supra, 194 Cal.App.4th at p. 889.)
       The litigation privilege applies to defendant’s December
2016 letter. It related to litigation threatened by plaintiff against
defendant’s client. For the reasons already discussed, the
statements in the letter bore a connection or logical relation to
the litigation and advanced Pendergrast’s interest in avoiding the
litigation. The trial court should have stricken plaintiff’s civil
extortion claim.

                                 21
       c.     Defendant’s request for attorney fees
       Defendant requests that we award him attorney fees and
costs under section 425.16, subdivision (c)(1), if he prevails.
Defendant is correct that, as the prevailing defendant after
appeal, he is entitled to attorney fees, including those incurred in
this appeal. (Wanland v. Law Offices of Mastagni, Holstedt &
Chiurazzi (2006) 141 Cal.App.4th 15, 21–22.) But, in part
because his fees have continued to accrue through the
prosecution of this appeal, the record is inadequate for us to do
so. The trial court will consider defendant’s request on remand.
                           DISPOSITION
       The order is reversed. The matter is remanded and the
trial court is instructed to grant defendant’s motion to strike
plaintiff’s causes of action against him for civil extortion and
violation of the Ralph Act. The trial court shall further consider
the amount of fees and costs to which defendant is entitled under
section 425.16, subdivision (c). Defendant is to recover his costs
on appeal.

                               GRIMES, J.

      WE CONCUR:

                        STRATTON, P. J.

                        WILEY, J.

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