Opinion
B315967
12-01-2023
ALBRIGHT, YEE & SCHMIT, APC, et al., Plaintiffs and Respondents, v. MICHAEL ZWEIBACK et al., Defendants and Appellants.
Klinedinst, Heather L. Rosing and Harold C. Trimmer for Defendants and Appellants. Law Office of Albert Robles and Albert Robles for Plaintiffs and Respondents.
NOT TO BE PUBLISHED
APPEAL from an order of the Superior Court of Los Angeles County. No. 20STCV45860 Elaine Lu, Judge. Affirmed.
Klinedinst, Heather L. Rosing and Harold C. Trimmer for Defendants and Appellants.
Law Office of Albert Robles and Albert Robles for Plaintiffs and Respondents.
EGERTON, J.
Michael Zweiback, Rachel L. Fiset, Erin Perez-Coleman, and their law firm, Zweiback, Fiset &Coleman LLP (the qui tam lawyers), filed a qui tam action against Clifton Albright and his law firm, Albright, Yee & Schmit, APC (Albright). The complaint alleged Albright had bribed public officials to retain him as counsel. After the court dismissed Albright from the case, he filed the present action against the qui tam lawyers.
For the sake of simplicity, we refer to both Albright and his firm as simply "Albright."
The qui tam lawyers moved to dismiss Albright's complaint under California's anti-strategic lawsuit against public participation (anti-SLAPP) statute (Code Civ. Proc., § 425.16). The trial court granted the motion in part, finding Albright had shown a probability of prevailing on only a single claim for malicious prosecution.
Undesignated statutory references are to the Code of Civil Procedure.
On appeal, the qui tam lawyers argue the court should have dismissed the entire complaint. They contend the court erred because Albright presented insufficient evidence showing they lacked probable cause to pursue the underlying action or that they acted with malice. We affirm.
FACTUAL AND PROCEDURAL BACKGROUND
1. The qui tam complaint against Albright
The West Valley Water District (the Water District) provides water service to several cities and unincorporated areas of San Bernardino and Riverside Counties. Five elected members of the Board of Directors (the Board) oversee and govern the Water District.
In early 2018, the Water District retained Albright to provide it with general legal advice. Clifford Young was president of the Board at the time, and he approved and signed a retainer agreement with Albright. The Water District subsequently engaged Albright to work on several matters, some of which involved complaints against Young.
In January 2019, Patricia Romero-who was the Water District's Assistant Board Secretary-sent a letter to the San Bernardino County District Attorney, in which she alleged Board members had used an illegal motion to overthrow Young and install Michael Taylor as Board president. She also alleged that, since Taylor had taken over, she had observed "multiple illegal activities," including attempts to extort $50 million of public funds from the Water District.
A month later, in February 2019, Young, Romero, and the Water District's Chief Financial Officer, Naisha Davis, (the qui tam plaintiffs) filed a qui tam action against several individuals and companies associated with the Water District, including Albright. The qui tam lawyers filed the complaint on behalf of the qui tam plaintiffs.
A qui tam action is an" 'action brought under a statute that allows a private person to sue for a penalty, part of which the government or some specified public institution will receive.'" (People ex rel. Allstate Ins. Co. v. Weitzman (2003) 107 Cal.App.4th 534, 538.)
The qui tam complaint alleged generally that Water District directors, executives, employees, and vendors were engaged in a conspiracy involving bribes and kickbacks. Among other individuals, the complaint identified as Albright's co-conspirators Michael Taylor (Water District Board President), Ricardo Pacheco (Water District Assistant General Manager), and Robert Tafoya (Water District General Counsel).
As to Albright specifically, the complaint alleged he submitted and conspired to submit false claims to the Water District, in violation of California's False Claims Act (the CFCA). The complaint alleged as follows: In September 2018, General Counsel Tafoya proposed to Young that the Water District engage Albright to handle new pending litigation against the Water District. In return, Tafoya said Albright would make a $2,000 donation to Young's campaign fund. Young rejected the offer. Nevertheless, the Water District engaged Albright to handle the matter. Albright subsequently made $1,000 political contributions to two Board members. The complaint concluded that, "[a]s a result of illegal kickbacks and bribes, the Board has approved Albright's invoices, of at least, $187,151."
Albright demurred, asserting the qui tam plaintiffs failed to allege he made a single false claim. According to Albright, "the complaint admits that [his firm's] invoices were approved by the Board . . ., of which [qui tam plaintiff] Young is one of five directors, and that the only Board member to have been offered a bribe is Dr. Young himself, who turned it down. There are no factual allegations that bribes or kickbacks were ever presented to any of the other Board members and, equally, influenced their vote."
Around this time, the Water District intervened in the case and moved to dismiss the qui tam complaint on the basis that it "is frivolous, vexatious and brought solely for the purpose of harassment." The Water District suggested Young had "hijacked" the CFCA "to interfere with ongoing investigations of harassment, bullying and misappropriation of public monies" against him. The Water District also noted the qui tam lawyers were representing Young in connection with those investigations.
The CFCA provides the "political subdivision may seek to dismiss the action for good cause notwithstanding the objections of the qui tam plaintiff if the qui tam plaintiff has been notified by the state or political subdivision of the filing of the motion and the court has provided the qui tam plaintiff with an opportunity to oppose the motion and present evidence at a hearing." (Gov. Code, § 12652, subd. (e)(2)(A).)
At a February 2020 hearing, the trial court found the allegations of kickbacks, bribes, and false claims were "bare bones" and not pleaded with the requisite particularity. The qui tam lawyers argued their allegations were sufficient because, had the Water District engaged Albright "based on a kickback or a bribe, even if the invoice is accurate, it is based on fraudulent activity and it is a false claim." The court responded, "If you want to get past the pleading stage, you have to lay out the facts that support it." The qui tam lawyers represented they could "add more particularity as details and investigations relating to state audits and other information." Based on that representation, the court granted them leave to amend.
The qui tam plaintiffs filed an amended complaint under seal in March 2020. The amended complaint omitted Albright and several other defendants named in the original complaint. However, the qui tam plaintiffs did not file a request to dismiss any of the unnamed defendants, including Albright.
In November 2020, the Water District and Albright filed a stipulation agreeing to dismiss Albright. A few days later, the court dismissed Albright with prejudice.
2. Albright's complaint against the qui tam plaintiffs and the qui tam lawyers
About a month later, in December 2020, Albright filed a complaint against the qui tam plaintiffs and the qui tam lawyers. The complaint asserted five causes of action: (1) malicious prosecution; (2) abuse of process; (3) defamation; (4) negligent interference with economic advantage; and (5) intentional interference with economic advantage. As to the qui tam lawyers, the complaint alleged they filed the action without conducting a reasonable investigation and with no good faith basis for believing Albright had violated the CFCA.
3. The qui tam lawyers' anti-SLAPP motion
The qui tam lawyers filed an anti-SLAPP motion seeking to dismiss Albright's complaint. According to the motion, the factual allegations in the qui tam complaint were premised "entirely on the personal observations, investigations, and documents of the [qui tam plaintiffs], and the lawsuit was filed because the [qui tam plaintiffs] were, up until that point, unsuccessful in their efforts to end the misconduct."
Each qui tam lawyer filed a separate anti-SLAPP motion. Because the motions are identical in all meaningful respects, we refer to them as a single motion.
The qui tam lawyers argued the overarching scheme alleged in the qui tam complaint was corroborated by the fact that two alleged qui tam co-conspirators, Tafoya and Pacheco, were under federal investigation. They also argued the complaint was corroborated by a June 2020 audit by the California State Controller. The audit found the Water District "did not process requests for qualifications when obtaining legal services over $10,000 as required in Procurement Policies and Procedures. Instead, the Board awarded contracts to legal firms based on the recommendations of the General Counsel, Tafoya ...." The audit listed eight law firms, including Albright, with whom the Water District had contracted between 2016 and 2020.
With respect to Albright's malicious prosecution claim- which is the only claim at issue in this appeal-the qui tam lawyers argued Albright could not show they lacked probable cause to file the qui tam action or that they acted with malice. The lawyers asserted their claims against Albright had merit, but the trial court erroneously "held that exchanging a campaign contribution for public employment does not constitute a FCA violation under state law absent an allegation that the legal services were not actually provided or were overbilled." Because of this legal error, the court never considered the "key fact" supporting their claims: "that Mr. Tafoya relayed an offer by Albright to exchange a campaign contribution to a District Board Member in exchange for the Board Member's vote to engage him with District funds ...."
In support of their motion, the qui tam lawyers submitted declarations from Young, Davis, and Romero. Each qui tam plaintiff asserted they believed the allegations in the qui tam complaint were true based on their personal observations and investigations, and the documents they had seen. The individual lawyers who represented the qui tam plaintiffs also submitted declarations stating they had no ill feelings towards Albright or a motive to file the lawsuit, other than to advocate on behalf of their clients.
4. Albright's opposition
Albright opposed the motion, pointing out the qui tam lawyers failed to submit any evidence as to what they knew, what research they performed, or what investigation they undertook before filing the qui tam action. As to his malicious prosecution claim, Albright asserted the qui tam lawyers did not investigate the claims, failed to meet and confer to negotiate a dismissal after it was apparent they had no evidence to support their claims, and "engaged in an extensive media spectacle to advertise their lawsuit to the public."
Albright submitted a declaration in which he discussed his history working for the Water District. According to the declaration, the Board approved a retainer agreement in November 2016, under which it engaged Albright to investigate allegations that Young had abused his power and misappropriated public funds. The Board claimed to be pleased with the quality of Albright's work, and it approved a new retainer agreement in March 2018. The Water District later engaged Albright to work on two new matters, both of which involved complaints against Young.
According to Albright, his firm properly billed the Water District for all the work performed, and he denied ever offering a political donation as a bribe or kickback. Albright also denied entering into an agreement with anyone to submit false claims to the Water District, to defraud the Water District, or otherwise to cause the Water District to pay monies for services not rendered or rendered at inflated rates.
Albright stated he and his firm "suffered tangible damage traceable directly to the widely disseminated reports of the [qui tam action]." His firm's largest client questioned him about the allegations, after which the workload from the client decreased significantly. Albright also claimed the qui tam lawyers "vigorously resist[ed]" dismissing him from the action, even after omitting him from the amended complaint. As a result, he was left in" 'limbo'" for several months.
Albright also submitted a declaration from Tafoya, who denied telling Young that Albright would donate $2,000 to his campaign fund if the Water District engaged Albright to handle a case. According to Tafoya, it "defies logic" for him to have done so, given he was authorized by the Board to assign a case to a qualified law firm of his choosing, provided the firm had a retainer agreement in place. At the time of the alleged bribe, Albright had a retainer agreement in place with the Water District.
Tafoya also suggested a possible motive for the qui tam lawyers to file a frivolous action against Albright. According to Tafoya, sometime around mid-2018, Young started advocating for the Water District to hire the qui tam lawyers. Young described the qui tam lawyers as being similar to Albright and other firms the Water District had retained.
5. The qui tam lawyers' reply
In their reply brief, the qui tam lawyers argued the allegations against Albright were based on the facts known to Young at the time, which the lawyers "reasonably believed" to be a violation of the CFCA. They also argued they did not dismiss Albright earlier because, after the Water District intervened in the case, only the Water District could dismiss a defendant from the action.
The qui tam lawyers supported their reply with emails purportedly showing the Water District prevented them from immediately dismissing Albright from the action. In an April 2020 email, a qui tam lawyer told counsel for the Water District she was comfortable dismissing Albright, but she needed the Water District's approval first. Counsel for the Water District said she would agree to dismiss the entire complaint, but the Water District would not agree to dismiss any individual defendants.
The qui tam lawyers submitted another email chain that contained a conversation between a qui tam lawyer and counsel for a defendant who, like Albright, had been omitted from the amended complaint. The qui tam lawyer told counsel the qui tam plaintiffs "still firmly believe that [the defendant's] actions violated the law but without discovery we are unable to provide the Court with further details relating to" the violations. The qui tam lawyer said the defendant was "effectively dismissed from the case without prejudice," but she could not formally dismiss him without approval from the Attorney General.
6. The court's ruling
After requesting and receiving supplemental briefing, the court issued a detailed, 42-page order granting the anti-SLAPP motion in substantial part. As to the first prong of the anti-SLAPP analysis, the court found Albright's claims arose out of protected activity. Accordingly, the court shifted the burden to Albright to show the claims had minimal merit. The court found Albright met his burden only with respect to his malicious prosecution claim, and it dismissed the other claims.
As to the malicious prosecution claim, the court found Albright had submitted sufficient evidence of each required element: (1) a favorable termination of the underlying action; (2) the qui tam lawyers lacked probable cause to bring or maintain the action; and (3) the qui tam lawyers acted with malice in doing so. In finding Albright met his burden to show a lack of probable cause, the court cited Tafoya's declaration in which he denied offering Young a bribe, which was the foundation for the qui tam claims against Albright. As to malice, the court noted the qui tam lawyers represented they could plead additional facts to support the claims against Albright, but they ultimately failed to do so. The court also pointed to an email in which a qui tam lawyer essentially admitted lacking sufficient facts to state a claim, yet the qui tam lawyers did not immediately dismiss Albright. Instead, according to Albright's declaration, they resisted dismissal.
The qui tam lawyers timely appealed.
DISCUSSION
The qui tam lawyers contend the trial court erred in finding Albright met his burden to show a probability of prevailing on his malicious prosecution claim. Specifically, they argue Albright failed to present sufficient evidence to establish two necessary elements: (1) the qui tam lawyers lacked probable cause to file the qui tam action against Albright; and (2) the qui tam lawyers filed the action with malice.
1. Relevant law and standard of review
The anti-SLAPP statute, section 425.16, provides a procedure for expeditiously resolving "nonmeritorious litigation meant to chill the valid exercise of the constitutional rights of freedom of speech and petition in connection with a public issue." (Sipple v. Foundation for Nat. Progress (1999) 71 Cal.App.4th 226, 235.) "When served with a SLAPP suit, the defendant may immediately move to strike the complaint under section 425.16. To determine whether this motion should be granted, the trial court must engage in a two-step process." (Hansen v. Department of Corrections & Rehabilitation (2008) 171 Cal.App.4th 1537, 1543; Equilon Enterprises v. Consumer Cause, Inc. (2002) 29 Cal.4th 53, 67 (Equilon).)
The first prong of the anti-SLAPP analysis requires the court to decide "whether the defendant has made a threshold showing that the challenged cause of action is one arising from protected activity." (Equilon, supra, 29 Cal.4th at p. 67; § 425.16, subd. (b)(1).) If the court finds the defendant has made the threshold showing, the analysis proceeds to the second prong, under which the court "determines whether the plaintiff has demonstrated a probability of prevailing on the claim." (Equilon, at p. 67; § 425.16, subd. (b)(1).)
The qui tam lawyers' appeal concerns only the second prong of the anti-SLAPP analysis. To satisfy the prong-two showing, the plaintiff must present credible evidence that satisfies the standard of proof required by the substantive law of the cause of action the anti-SLAPP motion challenges. To establish the requisite probability of prevailing, the plaintiff need only have" 'stated and substantiated a legally sufficient claim.'" (Briggs v. Eden Council for Hope & Opportunity (1999) 19 Cal.4th 1106, 1123.) In other words, a plaintiff's claim need only have" 'minimal merit'" to survive an anti-SLAPP motion. (Navellier v. Sletten (2002) 29 Cal.4th 82, 95, fn. 11 (Navellier).)
"In deciding the question of potential merit, the trial court considers the pleadings and evidentiary submissions of both the plaintiff and the defendant (§ 425.16, subd. (b)(2)); though the court does not weigh the credibility or comparative probative strength of competing evidence, it should grant the 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." (Wilson v. Parker, Covert & Chidester (2002) 28 Cal.4th 811, 821.)
We independently review the trial court's ruling on an anti-SLAPP motion under the de novo standard. (Computer Xpress, Inc. v. Jackson (2001) 93 Cal.App.4th 993, 999.) "Only a cause of action that satisfies both prongs of the anti-SLAPP statute- i.e., that arises from protected speech or petitioning and lacks even minimal merit-is a SLAPP, subject to being stricken under the statute." (Navellier, supra, 29 Cal.4th at p. 89.)
2. Albright met his burden to show a lack of probable cause
"To prevail on a malicious prosecution claim, the plaintiff must show that the prior action (1) was commenced by or at the direction of the defendant and was pursued to a legal termination favorable to the plaintiff; (2) was brought without probable cause; and (3) was initiated with malice." (Soukup v. Law Offices of Herbert Hafif (2006) 39 Cal.4th 260, 292 (Soukup).)
As to the second element, an" 'action is deemed to have been pursued without probable cause if it was not legally tenable when viewed in an objective manner as of the time the action was initiated or while it was being prosecuted.' [Citation.] The test is whether, on the basis of facts then known, any reasonable attorney would have believed that instituting or maintaining the prior action was tenable." (Citizens of Humanity, LLC v. Hass (2020) 46 Cal.App.5th 589, 599 (Hass).) Whether the attorney subjectively believed the claims were tenable is irrelevant. (Sheldon Appel Co. v. Albert &Oliker (1989) 47 Cal.3d 863, 881.)
An attorney has probable cause to pursue an action if the attorney has" 'evidence sufficient to uphold a favorable judgment or information affording an inference that such evidence can be obtained for trial.'" (Arcaro v. Silva &Silva Enterprises Corp. (1999) 77 Cal.App.4th 152, 156-157.) An inference is not reasonable if it is based on suspicion, imagination, speculation, surmise, conjecture, or guesswork. (Cole v. Patricia A. Meyer & Associates, APC (2012) 206 Cal.App.4th 1095, 1113.)
In order to prevail on their CFCA claims against Albright, the qui tam plaintiffs had to prove he knowingly presented a false or fraudulent claim for payment to the Water District, or that he conspired to do so. (See Gov. Code, § 12651, subd. (a)(1), (3).) As we understand it, the qui tam lawyers' theory was that Albright violated the CFCA by bribing Board members to engage him on litigation matters, which rendered fraudulent all the invoices he presented for work he performed on those matters. The qui tam lawyers supported that theory with three factual allegations: (1) Tafoya told Young that Albright would make a $2,000 political contribution to Young if the Water District engaged Albright on a new matter; (2) although Young refused the offer, the Water District engaged Albright on the matter; and (3) Albright later made $1,000 political contributions to two other Board members.
The parties disagree as to whether this is a viable theory to state a claim for a violation of the CFCA. We need not decide that issue because, even assuming it is, Albright has met his burden of showing the qui tam lawyers lacked probable cause.
In opposition to the anti-SLAPP motion, Albright presented evidence directly refuting these allegations. Specifically, both Albright and Tafoya submitted declarations in which they denied offering bribes to any Board member, including Young. Tafoya's declaration also called into question the basic premise of the qui tam lawyers' theory. According to his declaration, Tafoya had the unilateral authority to engage Albright on new matters, so bribing Board members to engage Albright would have been pointless. Assuming the declarations are true, there is nothing even to suggest Albright violated the CFCA. No reasonable attorney would have filed an action against Albright under those circumstances.
The qui tam lawyers insist the declarations do not show a lack of probable cause because they do not directly refute the lawyers' subjective knowledge at the time they filed the complaint. True, Albright's and Tafoya's declarations do not address the state of the qui tam lawyers' knowledge at that time. However, as Albright repeatedly pointed out below, there was nothing for him to refute because the qui tam lawyers submitted no direct evidence on the issue. Instead, they simply asserted, without evidentiary support, that they drafted the complaint based on information they received from the qui tam plaintiffs. The qui tam lawyers' unsupported assertions are not sufficient to defeat Albright's malicious prosecution claim as a matter of law.
Even if we were to assume the qui tam plaintiffs conveyed to their lawyers all the information contained in the complaint, we still would conclude Albright met his burden to show a lack of probable cause. The qui tam lawyers do not claim, nor is there anything to suggest, they possessed information beyond that contained in the complaint. Therefore, the issue for us to decide is whether a reasonable attorney, presented with the facts alleged in the complaint, would have believed that instituting a CFCA action against Albright was tenable. We conclude the answer to that question is no.
The trial court in the qui tam action found the allegations against Albright were insufficient to state a claim, and rightly so. Despite asserting the Board paid Albright's invoices "[a]s a result of illegal kickbacks and bribes," the complaint did not allege that Albright had successfully bribed any Board member. Nor did it identify any other specific misconduct by Albright that could form the basis for a CFCA claim. Instead, the claims were premised entirely on innuendo and speculation. As the trial court astutely observed, without more specific allegations of misconduct, the complaint was essentially a "smear." No reasonable attorney would believe the allegations were sufficient to state a claim against Albright.
The qui tam lawyers argue the trial court's dismissal of their complaint does not mean their allegations against Albright were insufficient to state a claim. Instead, they contend, the trial court dismissed the complaint based on its erroneous belief that bribing a public official to award a contract does not constitute a violation of the CFCA.
The record does not support the qui tam lawyers' contention. At the hearing on the motion to dismiss, the qui tam lawyers explained their theory of the case and argued that if the Board engaged Albright "based on a kickback or a bribe, even if the invoice is accurate, it is based on fraudulent activity and it is a false claim." The trial court did not disagree. Instead, it admonished the qui tam lawyers to "lay out the facts that support it." Rather than do so, the qui tam lawyers simply omitted Albright from the amended complaint.
Regardless of the reason the trial court dismissed the qui tam complaint, the allegations were plainly insufficient to state a claim against Albright. Of the three qui tam plaintiffs, only Young claimed to have information concerning Albright specifically. According to Young, Tafoya essentially offered Young a bribe if the Water District engaged Albright on a new matter. However, Young insisted he refused the offer. Therefore, Young's account alone was not sufficient to state a claim against Albright for violating the CFCA, and no reasonable attorney would believe otherwise.
Likely aware of this problem, the qui tam lawyers also included in the complaint allegations that Albright made donations to two other Board members after the Water District engaged him on a new matter. Although the implication is that the donations were bribes, the qui tam lawyers did not explicitly allege as much. Nor did they amend their complaint to add explicit allegations after the court dismissed the complaint for a lack of specificity. Even on appeal, the qui tam lawyers refer to the donations only briefly and avoid explicitly calling them bribes. The qui tam lawyers cannot claim to have had probable cause to file the action based on facts they repeatedly declined to allege explicitly.
The qui tam lawyers alternatively insist Romero's letter to the San Bernardino County District Attorney-in which she reported corruption at the Water District-"provides independent and bona fide reasons to have pursued the Albright Firm." We have reviewed the entire letter. It does not refer to Albright, explicitly or implicitly, nor does it even suggest Albright was involved in a bribery or kickback scheme. That the qui tam lawyers believe this letter provides an "independent" reason to pursue Albright is troubling, to say the least.
The same is true of the qui tam lawyers' purported reliance on Davis's accounts of self-dealing and corruption at the Water District. As with Romero, Davis has never claimed Albright was involved in any misconduct. While Davis's reports of widespread corruption might provide a reason to investigate Albright, they do not provide probable cause to bring an action against him, even when considered with the information provided by the other qui tam plaintiffs.
Nor is it reasonable to infer, as the qui tam lawyers argue, they would have been able to obtain "additional evidence to support the allegations in the complaint" if they were permitted to engage in discovery. In making this argument, the qui tam lawyers overlook that the claims against Albright were deficient not for a lack of evidence, but rather for a lack of specific allegations of misconduct. The qui tam lawyers have never identified a single illegal bribe, kickback, or other form of misconduct that could form the basis for a CFCA claim against Albright. Nor have they identified any specific facts or evidence they could have reasonably expected to uncover in discovery that would have cured the complaint's deficiencies.
The qui tam lawyers contend the California State Controller's audit and the criminal investigations into Tafoya and Pacheco confirm they would have uncovered additional facts to support their claims had they been given the opportunity to do so. The qui tam lawyers read far too much into this evidence. The State Controller's audit found the Board bypassed the Water District's established procurement procedures and policies by awarding contracts to legal firms-such as Albright-based solely on the recommendations of the General Counsel, Tafoya. The audit did not find, or even suggest, Albright had bribed Board members, submitted false claims, or engaged in any other sort of misconduct that might form the basis for a CFCA claim. Similarly, the qui tam lawyers fail to identify any information uncovered in the criminal investigations that directly concerns Albright. While reports of widespread corruption might raise suspicions about everyone associated with the Water District, they do not provide probable cause to institute an action against Albright specifically.
We deny the qui tam lawyers' request to take judicial notice of a redacted plea agreement between Pacheco and the United States, which a district court unsealed in October 2022. The qui tam lawyers argue the plea agreement is relevant "to show the outcome of federal grand jury investigations into the bribery and kickback scheme alleged . . . in the underlying qui tam action ...." They fail, however, to explain why the outcome of the investigations is at all relevant to the issues raised in this appeal, which concern the qui tam lawyers' knowledge when they filed and maintained the qui tam action.
3. Albright met his burden to show malice
To establish the malice element of a malicious prosecution claim, a plaintiff must show the defendant initiated the prior action for an improper purpose. (Hass, supra, 46 Cal.App.5th at pp. 606-607.) Malice is not limited to actual ill will towards the plaintiff. (Ibid.) Instead, malice" 'may range anywhere from open hostility to indifference.'" (Soukup, supra, 39 Cal.4th at p. 292.)
A lack of probable cause alone does not establish malice, but malice may be" 'inferred from the facts establishing lack of probable cause.'" (Soukup, supra, 39 Cal.4th at p. 292.) In other words, evidence that the defendant knowingly brought the prior action without probable cause, or continued to prosecute the action after becoming aware that it lacks probable cause, is relevant to the malice issue. (See Maleti v. Wickers (2022) 82 Cal.App.5th 181, 223.) Because direct evidence of malice is rarely available, it is typically proven by circumstantial evidence. (Hass, supra, 46 Cal.App.5th at p. 607.)
Here, Albright presented sufficient evidence to infer the qui tam lawyers brought the qui tam action against him for an improper purpose. As we discussed above, the allegations in the qui tam complaint were plainly insufficient to support a claim against Albright. Indeed, despite the qui tam lawyers' assertion that they reasonably believed Albright violated the CFCA by bribing Board members, they failed explicitly to allege a single instance in which he successfully bribed anyone associated with the Water District. Given their omission of such a key allegation, it is reasonable to infer the qui tam lawyers knew their claims were deficient and would be dismissed.
Despite this knowledge, the qui tam lawyers drafted the complaint in such a way as to suggest-at least to a casual reader-that Albright had engaged in serious misconduct. Immediately after describing an unsuccessful attempt to bribe Young with a political donation, the qui tam lawyers alleged Albright made political donations to two other Board members. The clear implication was that the donations were bribes. However, the fact that the qui tam lawyers did not explicitly allege as much-even after the court dismissed the complaint for a lack of specificity-strongly suggests they knew they had no basis to make such a claim. Under these circumstances, it is reasonable to infer the qui tam lawyers named Albright in the complaint to "smear" him-as the trial court suggested-rather than out of a good faith belief that he had violated the CFCA.
Even if the qui tam lawyers were not initially aware their claims lacked merit, Albright presented evidence that they resisted dismissing him from the case after it was apparent they could not state a claim against him. The qui tam lawyers filed an amended complaint under seal in March 2020, which omitted Albright as a defendant. It is reasonable to infer the qui tam lawyers were aware at that time an action against Albright was not tenable. Indeed, one of the qui tam lawyers essentially admitted in an email that they lacked the necessary evidence to pursue claims against the defendants whom they had omitted from the amended complaint.
Despite this apparent admission, the qui tam lawyers did not immediately move to dismiss Albright from the action. Instead, Albright remained in the case for roughly eight months -until November 2020-when the Water District stipulated to his dismissal. Albright stated in a declaration that the qui tam lawyers "vigorously resist[ed]" dismissing him during that time. Moreover, because the qui tam lawyers filed the amended complaint under seal, it would not have been apparent to an outside observer that the qui tam plaintiffs were no longer pursuing claims against Albright. Under these circumstances, a reasonable trier of fact could infer the qui tam lawyers resisted dismissing Albright in order to harm his reputation.
Albright supported that inference by presenting evidence of possible motives for the qui tam lawyers to attempt to harm his reputation. According to Tafoya's declaration, around the time the qui tam lawyers filed the complaint, Young had been advocating for the Water District to retain them as outside counsel. If so, the qui tam lawyers and Albright were potentially competing for the same work. Albright also submitted evidence that, as counsel to the Water District, he was tasked with investigating several complaints against Young, and the qui tam lawyers were representing Young in connection with those investigations. By naming Albright in the complaint, the qui tam lawyers would have helped to discredit Albright and his investigations into their client. While far from overwhelming, when considered with the other circumstances under which the qui tam lawyers filed the complaint, this evidence is sufficient to meet Albright's burden to show malice.
In passing, the qui tam lawyers argue this portion of Tafoya's declaration is inadmissible hearsay. The qui tam lawyers have forfeited their argument by failing to support it with meaningful analysis or citation to relevant authority. (See In re S.C. (2006) 138 Cal.App.4th 396, 408 ["To demonstrate error, appellant must present meaningful legal analysis supported by citations to authority and citations to facts in the record that support the claim of error."].) In any event, Tafoya's declaration is not inadmissible hearsay, as Young's statements advocating for the qui tam lawyers were not offered for the truth of the matters asserted. (See Evid. Code, § 1200 [defining hearsay].)
The qui tam lawyers insist they submitted emails showing they wanted to dismiss Albright immediately, but the Water District prevented them from doing so. That may be so. The emails, however, do not defeat Albright's malicious prosecution claim as a matter of law; at most, they create a conflict for the trier of fact to resolve. Accordingly, they are not sufficient to warrant granting the anti-SLAPP motion.
DISPOSITION
We affirm the order. Clifton Albright and Albright Yee & Schmit, APC are awarded their costs on appeal.
We concur: EDMON, P. J. LAVIN, J.