Opinion
A167266
09-09-2024
CHRISTOPHER MARKS, Plaintiff and Appellant, v. DENALI WATER SOLUTIONS, LLC, Defendant and Respondent.
NOT TO BE PUBLISHED
(Marin County Super. Ct. No. CIV202233)
TUCHER, P.J.
Plaintiff Christopher Marks sued his former employer, Denali Water Solutions, LLC (Denali) after Denali terminated his employment. In response, Denali brought an anti-SLAPP (strategic lawsuit against public participation) motion under section 425.16 of the Code of Civil Procedure, which the trial court granted as to the causes of action for wrongful termination, interference with economic advantage, and defamation. On appeal, Marks argues the trial court abused its discretion in allowing Denali to file its anti-SLAPP motion late and that its ruling was wrong on the merits. We reject the procedural argument but agree in large part on the merits.
All undesignated statutory references are to the Code of Civil Procedure.
FACTUAL AND PROCEDURAL BACKGROUND
I. Allegations of the Complaint
Denali is in the business of recycling wastewater solids. Marks worked for Denali for 21 years, most recently as a manager. His direct supervisor was Jeff Thurber, the general manager for Denali's western region, who held his position as an independent contractor. Denali allows its employees to engage in outside employment, subject to certain limitations.
Thurber also owned two companies, Clean Waste LLC, dba Clean Waste Trucking (Clean Waste) and Specialized Reuse and Recycling LLC (Specialized Reuse), which owned specialized trailers and which delivered and spread wastewater products. In 2014, Thurber hired Marks to perform administrative work for these companies.
Clean Waste and Specialized Reuse contracted with Denali to transport wastewater, allegedly on similar terms with the other vendors Denali used for these services.
The problems at issue in this case began on March 1, 2022, when Marks attended a meeting with Denali's general counsel and two Denali executives. They accused him of" 'skimming'" from Denali, told him he could go to jail for his actions, advised him to get an attorney, and suspended him without pay. The next day, Denali's president called Marks and told him he did not want to" 'ruin [Marks's] life'" or" 'take this to a criminal level,'" but that" 'one guy that did this to [him] is in jail right now,'" and that Marks would face the same consequences unless he admitted wrongdoing, cooperated with Denali, and provided information about Thurber's business contacts.
Denali also demanded of Thurber that he hand over his companies' business contacts and, under threat of criminal prosecution, he did so. Denali then began contacting the vendors of Clean Waste and Specialized Reuse, telling them (falsely, according to the complaint) that Marks had formed Clean Waste and Specialized Reuse to defraud Denali, that he had skimmed funds from Denali and admitted stealing from it, that he had violated his fiduciary duty to Denali, that he had left Denali, and that he was no longer working in the industry. It made similar statements to employees, contractors and other people in the industry, including telling them Marks had altered vendor invoices and that he was in jail.
Denali suspended Marks, with pay, from March 3 to May 31, 2022. Because of Denali's actions, Marks lost his position with Thurber, with resulting loss of income.
Denali's president, Andrew McNeill, told Marks on April 11, 2022 that the company had concluded its investigation and found no evidence Marks had committed wrongdoing, said he did not think Marks had been a" 'ringleader,'" described Marks as a" 'real asset,'" and told Marks he wanted him to return to work. But, McNeill said, if Marks was not willing to" 'break bread'" with other employees he could leave the company. Marks understood McNeill's remarks to mean that he could return to work only if he admitted wrongdoing in the presence of other management employees.
Denali sent Marks an email on May 31, 2022 telling him that his employment had been terminated, effective May 27, for" 'wrongdoing,'" with no explanation of the outcome of any investigation or what wrongdoing he had committed. It thereafter failed to pay him amounts he was entitled to receive upon termination.
Based on these allegations, Marks brought this action alleging causes of action for wrongful termination, breach of the implied covenant of good faith and fair dealing, intentional and negligent interference with prospective economic relations, defamation per se, defamation per quod, and violations of the Labor Code.
II. The Anti-SLAPP Motion
Denali brought a special motion to strike the causes of action for wrongful termination, breach of the implied covenant of good faith and fair dealing, intentional and negligent interference with prospective economic relations, and defamation. It argued these causes of action arose from conduct protected by section 425.16 because they were based on Denali's actions in investigating Marks's alleged misconduct in anticipation of a criminal referral, and that Marks could not show a probability of success on the merits.
Evidence in Support of Anti-SLAPP Motion
The evidence in support of the motion showed that, although Denali does not prohibit outside employment, it does not allow any outside employment that competes with, conflicts with, or compromises the company's interests. Denali's employee handbook requires employees to seek review from their manager or the Human Resources department before engaging in any relationship that might give rise to a conflict of interest; among those relationships are being employed by one of Denali's competitors, suppliers, or contractors. Dave Vaughn, Denali's executive vice president, stated in a declaration that Denali prohibits employment by a competitor, supplier, or contractor, regardless of the nature of the employment.
Vaughn also stated that shortly after he began working for Denali in December 2021, he received a report about misconduct by Denali employees who were associated with Clean Waste, one of the company's contractors. Two of those employees were Marks and Thurber. The complaint accused them of theft and mismanagement of Denali's funds, equipment, and personnel. Vaughn suspected Thurber had steered subcontracted work to his own companies without disclosing it to Denali. Vaughn was also concerned the employees' actions might violate state and federal law and put Denali at risk of legal exposure. He ordered an investigation into all services rendered by subcontractors for Denali's California locations.
After investigating the matter, Vaughn asked Thurber and Marks for interviews. Thurber refused, and his employment was terminated. Marks appeared for his interview on March 1, 2022. He was placed on administrative leave as the company conducted an internal investigation.
According to Vaughn's declaration, Denali believed its customers and vendors were participating (possibly unwittingly) in Clean Waste's scheme. Vaughn caused them to be notified of the alleged misconduct.
Denali completed its investigation toward the end of May 2022, and on May 31, Marks's employment was terminated. On June 20, 2022, Vaughn said that he reported Denali's findings to an agent of the Federal Bureau of Investigation (FBI) and to the Riverside County Sheriff's Department, and that Denali was also considering civil actions against Thurber and Marks for theft and criminal conspiracy.
Daniel Cox, Denali's operations controller, submitted a declaration stating he had conducted an investigation of Clean Waste and learned that it was owned by Thurber and that it appeared Marks was associated with the company. The investigation revealed that it appeared Clean Waste had arranged for delivery of large amounts of fuel to it, paid for by Denali, in violation of company policy; that it used Denali equipment without permission; that Denali staff had been told to fix trailers used by Clean Waste; that Clean Waste was paid approximately $4,000,000 in 2021 for its services and that a related company also controlled by Thurber, Specialized Reuse, was paid hundreds of thousands of dollars more; and that Clean Waste was paid more for its services than other contractors were. There was also information suggesting Thurber and Marks were business partners, Cox reported.
Evidence in Opposition to Motion
In opposition to the anti-SLAPP motion, Marks submitted a number of declarations. In his own, he stated that he had no ownership interest in Clean Waste or Specialized Reuse and that it was his understanding that Thurber was their sole owner; that Clean Waste did not compete with Denali, but rather performed services for it by trucking solid waste to Denali customers; that Clean Waste charged the same base rate to Denali that other trucking companies did; and that Specialized Reuse performed services for Denali in the form of spreading solid waste on agricultural land owned by Denali's customers and charged the same base rate as other spreaders. Clean Waste's work hauling and distributing biosolid waste to Denali's customers was, for the most part, in areas where there were no other such services available.
Marks acknowledged that for about eight months in 2014, Thurber listed him as a member of the two companies, although Marks had subsequently relinquished any apparent ownership or control. Marks performed bookkeeping work for Clean Waste, a fact of which his manager was aware, and his work did not compete with, conflict with, or compromise Denali's interests.
Marks stated in his declaration that, while he was on administrative leave, McNeill demanded that he disclose the names of Clean Waste's vendors, but that he refused and referred McNeill to Thurber. Denali employees then obtained a list of Clean Waste's and Specialized Reuse's vendors by threatening Thurber, and they told the vendors, falsely, that Marks had altered their invoices and was stealing from Denali. They also contacted Clean Waste's truckers and told them Marks and Thurber were no longer with Denali and the truckers had to work directly for Denali. At the time, Marks was still employed by Denali. According to Marks, Denali representatives also told "third parties within the industry" that he had engaged in financial wrongdoing and was" 'in jail'" or" 'out of the industry.' "
The trial court sustained Denali's objections to portions of Marks's declaration as inadmissible hearsay. The record does not appear to include a copy of Denali's objections, but it appears from the ruling that the sustained objections included Marks's statements repeating what others had told him about what Denali's representatives had told them.
Marks stated that he repeatedly asked Denali to investigate the allegations against him and to investigate the false statements being made to third parties about his actions. He was never provided with an investigation report. On April 11, 2022, McNeill told Marks the company had finished its investigation and had not found he committed any wrongdoing.
Marks's attorney, Patricia Kramer, submitted a declaration on his behalf. Among other things, she said that on April 18, 2022, she wrote to Chris Carrillo, an attorney representing Denali, indicating that McNeill had told Marks he had determined Marks had done nothing wrong and could return to work under certain circumstances. Carrillo responded that Denali had not yet completed its investigation. On May 16, Carrillo told Kramer he would check on the investigation, but neither Kramer nor Marks ever received any findings from the investigation. The complaint in this action was filed on June 24, 2022.
Kramer made inquiries with the Riverside County Sheriff's Department, requesting a copy of a report of any crime committed by Marks, and obtained a report filed July 21, 2022, after Denali had been served with the complaint in this action. Marks's name was not mentioned in the report, although Thurber's name was.
Ruling on Motion
The trial court concluded the causes of action for wrongful termination, interference with economic relations, and defamation were protected by the anti-SLAPP statute and that plaintiff had not shown a probability of success on the merits, and granted the special motion to strike as to those claims and certain supporting allegations. It denied the motion as to the cause of action for breach of the implied covenant of good faith and fair dealing.
DISCUSSION
I. Late Anti-SLAPP Motion
A special motion to strike may be filed "within 60 days of the service of the complaint or, in the court's discretion, at any later time upon terms it deems proper." (§ 425.16, subd. (f), italics added.) The motion in this case was filed more than 60 days after the complaint was served. Marks contends the trial court abused its discretion in allowing it to be filed.
A. Additional Procedural History
Marks filed his complaint on June 24, 2022 and served it on July 20, 2022. Denali served its anti-SLAPP motion on September 26, 2022 but failed to file it or any other responsive pleading.
At Marks's request, the trial court entered a default on November 1, 2022, and Marks served notice of it the following day. Denali then moved to set aside the default and to set the anti-SLAPP motion. It attached evidence that its counsel's paralegal arranged for an outside vendor, One Legal, to file the anti-SLAPP motion and received an email telling her the request was in progress. The paralegal stated she learned only on November 1, 2022 that the motion had not been filed, and she did not know why One Legal had failed to file it.
Denali moved ex parte for an order shortening time for the hearing on its motion to set aside the default and to set its anti-SLAPP motion.
In opposition to Denali's request, Marks argued that vendor error was not the reason Denali failed to file its anti-SLAPP motion on time. He submitted evidence that a paralegal for his counsel's office had called One Legal, identified herself, provided the order number for Denali's anti-SLAPP motion, and requested the status of the order. A representative of One Legal replied that their notes indicated the customer had cancelled the anti-SLAPP filing on September 26, 2022, because they had missed the trial court's 4:00 p.m. filing deadline. One Legal sent a copy of the notes to Marks's law firm. His counsel had also sought to depose Denali's attorney and paralegal regarding these events.
The trial court found that Denali's failure to file its responsive pleading was a result of mistake, inadvertence, surprise or excusable neglect and that Marks had not shown prejudice. Without directly addressing Denali's failure to ensure its anti-SLAPP motion was filed in a timely manner, it granted Denali's motion to set aside the default and permitted it to file the anti-SLAPP motion.
B. Analysis
The purposes of the 60-days limitation for bringing a special motion to strike are "to require presentation and resolution of the anti-SLAPP claim at the outset of litigation before the parties have undertaken the expenses of litigation that begin to accrue after the pleading stage of the lawsuit," and "to avoid tactical manipulation of the stays that attend anti-SLAPP proceedings." (Olsen v. Harbison (2005) 134 Cal.App.4th 278, 287 (Olsen); see § 425.16, subd. (f).) However, a trial court has considerable discretion when deciding whether to allow the filing of a special motion to strike after 60 days have passed. (Platypus Wear, Inc. v. Goldberg (2008) 166 Cal.App.4th 772, 787; § 425.16, subd. (f).) Abuse of discretion is shown if the ruling was whimsical, arbitrary, or capricious, or if the trial court had a mistaken view of the scope of its discretion, bearing in mind the statute's purposes and policy. (Olsen, at p. 285.) A trial court may abuse its discretion by allowing late filing, for example, if there was extreme delay in seeking to bring an anti-SLAPP motion, weak excuses for delay, and potential for significant prejudice from the delay. (Platypus Wear, at p. 787.) The party challenging the ruling has the burden to show an abuse of discretion. (Hoang v. Tran (2021) 60 Cal.App.5th 513, 526.)
Marks has not shown an abuse of discretion here. He argues that the record shows Denali's counsel was not forthright about the reason the anti-SLAPP motion was not filed on September 26. Denali makes no attempt to explain the notes allegedly provided by One Legal, and we find the conflict between those notes and the sworn statements Denali has submitted to be troubling. But the trial court could reasonably have concluded that nailing down these facts was not important to deciding the motion. The parties' submissions, taken as a whole, are consistent with a clerical error or oversight, either on the part of One Legal in failing to file the motion on September 26 or 27 or on the part of counsel's office in failing to follow up to ensure someone filed the motion, or both.
Marks contends Denali did not satisfy the requirements of section 473, subdivision (b), which permits relief from a default entered by the clerk where the application for relief is accompanied by counsel's "sworn affidavit attesting to his or her mistake, inadvertence, surprise, or neglect," because the declaration of Denali's counsel does not attest to counsel's own neglect in not filing the motion on time. But that statutory provision applies to relief from a default or default judgment entered by a clerk. (§ 473, subd. (b).) The anti-SLAPP statute, by contrast, simply authorizes a trial court to allow a special motion to be filed more than 60 days after service of the complaint "in the court's discretion . . . upon terms it deems proper." (§ 425.16, subd. (f).) The trial court did so here. Immediately after it found Denali had made the necessary statutory showing for relief from default-a decision Marks does not challenge on appeal-the trial court provided a short deadline for Denali to file and serve its anti-SLAPP motion.
Marks argues further that the trial court abused its discretion in failing to allow him to present testimony at the hearing on Denali's request for leave to file the special motion to strike, so that he could probe the reasons the special motion to strike was not filed in a timely manner. The record on appeal does not include a transcript of that hearing, and we cannot determine whether the trial court questioned counsel about the matter. But motions are ordinarily decided based on the written submissions (Cal. Rules of Court, rule 3.1306(a); McLellan v. McLellan (1972) 23 Cal.App.3d 343, 359), and there is no reason to presume the trial court was not fully aware of the discrepancies to which Marks now points.
More important, Marks makes no showing that the trial court's ruling frustrated the purposes of the 60-day limitation or prejudiced him. The litigation was in its early stages: the parties had discussed whether Marks would amend his complaint, Denali had not yet filed its answer, and there is no indication discovery was underway. Marks's counsel had already begun drafting the response to the anti-SLAPP motion, and there is no basis to conclude that allowing the motion to be filed after the default was lifted would delay the case unduly or cause the parties to spend time and resources on discovery that might ultimately prove unnecessary. (See Morin v. Rosenthal (2004) 122 Cal.App.4th 673, 681-682 [no abuse of discretion in denying anti-SLAPP motion as untimely where defendant had spent seven months in moving case to different courts]; compare Hewlett-Packard Co. v. Oracle Corp. (2015) 239 Cal.App.4th 1174, 1189-1191 [anti-SLAPP motion brought on last court date before trial could not fulfill statutory objectives].) And Marks has not established that Denali's delay in filing the anti-SLAPP motion was the result of strategic maneuvering. (See Olsen, supra, 134 Cal.App.4th at p. 287.) In the circumstances, we cannot discern any abuse of the trial court's discretion in allowing the anti-SLAPP motion to go forward.
II. The Merits of the Anti-SLAPP Motion
A. Legal Framework
Section 425.16 provides that "[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).) Such an act includes written or oral statements or writings "made before a legislative, executive, or judicial proceeding, or any other official proceeding authorized by law" or "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," as well as "any other conduct in furtherance of the exercise of the constitutional right of petition or the constitutional right of free speech in connection with a public issue or an issue of public interest." (§ 425.16, subd. (e).)
The court follows a two-step process in considering a special motion to strike. First, it decides whether the defendant has shown that the challenged cause of action arises from protected activity, that is, activity that falls within one of the categories of section 425.16, subdivision (e). If that showing has been made, the court then determines whether the plaintiff has demonstrated a probability of success on the claim. (Hecimovich v. Encinal School Parent Teacher Organization (2012) 203 Cal.App.4th 450, 463.) The court may consider the pleadings as well as supporting and opposing affidavits regarding the facts on which the defendant's liability or defense is based. (§ 425.16, subd. (b)(2).) On appeal, our review is de novo. (Hecimovich, at p. 464.)
A defendant's burden in the first step 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.' [Citation.] To determine whether a claim arises from protected activity, courts must 'consider the elements of the challenged claim and what actions by the defendant supply those elements and consequently form the basis for liability.'" (Wilson v. Cable News Network, Inc. (2019) 7 Cal.5th 871, 884 (Wilson), citing Park v. Board of Trustees of California State University (2017) 2 Cal.5th 1057, 1060, 1063 (Park).) The court then determines whether the defendant has established that "the defendant's conduct by which plaintiff claims to have been injured" falls within one of the categories set out in section 425.16, subdivision (e). (Equilon Enterprises v. Consumer Cause, Inc. (2002) 29 Cal.4th 53, 66; accord, Wilson, at p. 884.)
In this inquiry," '[a] claim arises from protected activity when that activity underlies or forms the basis for the claim.'" (Verceles v. Los Angeles Unified School Dist. (2021) 63 Cal.App.5th 776, 784 (Verceles).)" '[T]he defendant's act underlying the plaintiff's cause of action must itself have been an act in furtherance of the right of petition or free speech.'" (Park, supra, 2 Cal.5th at p. 1063.) The fact that an action was filed after protected activity took place is not sufficient; rather, the moving defendant must show that the "conduct by which plaintiff claims to have been injured" falls within the scope of the anti-SLAPP statute. (Park, at p. 1063.)
Section 425.16 protects not only communications during an official proceeding, but also those "preparatory to or in anticipation of the bringing of an action or other official proceeding." (Dove Audio, Inc. v. Rosenfeld, Meyer & Susman (1996) 47 Cal.App.4th 777, 784, 780 (Dove Audio) [communications seeking endorsement of proposed complaint to Attorney General]; accord, Briggs v. Eden Council for Hope & Opportunity (1999) 19 Cal.4th 1106, 1115 (Briggs) [assisting tenant to institute legal action with department of Housing and Urban Development (HUD), defamatory statements made to investigator and others in connection with HUD action]; Karnazes v. Ares (2016) 244 Cal.App.4th 344, 353-354 [communications in context of anticipated litigation and settlement].)
Even within a single pleaded" 'cause of action,'" discrete allegations of protected activity that form a basis for relief may be stricken unless the plaintiff shows a probability of prevailing. (Baral v. Schnitt (2016) 1 Cal.5th 376, 393, 395 (Baral).) That is, where a single cause of action includes both claims supported by allegations of protected activity and claims based on unprotected activity, an anti-SLAPP motion "cannot be defeated by showing a likelihood of success on the claims arising from unprotected activity." (Id. at p. 392.) If the moving defendant shows that relief is sought based on allegations arising from protected activity, the burden shifts to the plaintiff to demonstrate that each claim based on protected activity has minimal merit. (Id. at p. 396.) If the plaintiff fails to make that showing, "[a]llegations of protected activity supporting the stricken claim are eliminated from the complaint, unless they also support a distinct claim on which the plaintiff has shown a probability of prevailing." (Ibid.; see Bonni v. St. Joseph Health System (2021) 11 Cal.5th 995, 1011 (Bonni) [rule applies even where motion to strike is directed at entire cause of action as pleaded].)
B. Analysis
With these standards in mind, we consider the challenged causes of action in turn. The first is for wrongful termination in violation of public policy. Plaintiff alleges that his work performance was exemplary; that at no point did he misdirect or mismanage Denali funds or "skim" funds intended for Denali; that in early March 2022, representatives of Denali accused him of skimming, told him he could go to jail, made other threats, and suspended him without pay; that when Marks objected, Denali told him it would conduct a neutral investigation to determine whether he had engaged in corporate fraud or theft; that on April 11, 2022 McNeil told plaintiff that Denali had concluded its investigation and found no evidence of wrongdoing and that he wanted plaintiff to return to work on condition he" 'break bread'" with McNeill and other Denali employees; that Denali obtained Thurber's business contacts through threats of prosecution and then interfered with Thurber's business relationships, resulting in plaintiff losing his job with Thurber; and that Denali terminated plaintiff's employment for unspecified wrongdoing at the end of May 2022. This termination, plaintiff alleged "was substantially motivated by a violation of public policy, including interference with [plaintiff's] prospective economic advantage, extortion vis-a-vis threats of criminal prosecution, arrest and imprisonment," and violations of the Labor Code. And, he alleged, his termination was "in furtherance of Denali's plan to engage in unfair business practices in violation of Business and Professions Code [section] 17200, et seq." (Capitalization omitted.)
Marks acknowledges in his opening brief that the Labor Code violations, which allegedly took place upon and after his termination, do not support the cause of action for wrongful termination, and we do not consider them here.
To the extent these allegations are based on threats of criminal prosecution, we agree with the trial court that they are protected by the anti-SLAPP statute, because they were made in anticipation of bringing a criminal complaint. (See Briggs, supra, 19 Cal.4th at p. 1115; Dove Audio, supra, 47 Cal.App.4th at p. 784.) Both the complaint and the evidence submitted show that Denali conducted an investigation into the alleged wrongdoing by both Thurber and plaintiff and that it ultimately made a criminal complaint against Thurber. Although plaintiff alleges he was told before his employment was terminated that the company had completed its investigation into his actions and had found no wrongdoing, he alleges expressly that the wrongfulness of the termination was based in part on Denali's threats of criminal prosecution before it made its complaints to law enforcement, a matter within the scope of section 425.16.
But the allegations that the termination was intended to further Denali's plan to engage in unfair business practices and interfere with plaintiff's prospective economic advantage have a broader basis, that is, Denali's alleged actions in telling Clean Waste and Specialized Reuse vendors not to do business with Thurber's companies but to contract directly with Denali instead, ultimately leading to plaintiff losing his position and his income from Thurber. Whatever Denali's motivation for seeking to contract directly with the vendors, it has not shown these solicitations formed a part of its investigation of Thurber's and Marks's alleged criminal conduct or, put another way, that the solicitations were themselves" 'act[s] in furtherance of the right of petition or free speech.'" (Park, supra, 2 Cal.5th at p. 1063; see Verceles, supra, 63 Cal.App.5th at p. 784.)
In reaching this conclusion, we recognize that communications to private citizens may at times fall within the scope of the anti-SLAPP statute. In Dove Audio, for instance, a law firm representing a family member of deceased celebrity Audrey Hepburn conducted an investigation into whether the plaintiff, Dove Audio, Inc., had violated its contractual obligation to pay royalties to charities designated by Hepburn and 13 others who had participated in making a recording. (Dove Audio, supra, 47 Cal.App.4th at pp. 779-780.) In the course of its investigation, the law firm wrote to the other participants, telling them little of the money had gone to the charities and asking them to endorse its efforts to file a complaint with the Attorney General. (Id. at p. 780.) Dove Audio, Inc. sued the law firm for defamation and interference with economic relationship, and the law firm brought an anti-SLAPP motion, which the trial court granted. (Id. at pp. 780-781.)
On appeal, Dove Audio, Inc. argued the action was not a SLAPP suit. The appellate court disagreed, explaining that the law firm's communication was made in connection with an official proceeding authorized by law-a proposed complaint to the Attorney General-and sought support for the complaint. (Dove Audio, supra, 47 Cal.App.4th at p. 784.) The letter was thus "in furtherance of [the law firm's] constitutional right of petition," and was protected by section 425.16. (Dove, at p. 784.) Here, in contrast, Marks has not alleged, and Denali has not shown, that Denali's alleged communications-telling Thurber's vendors to do business directly with Denali-were intended to gain information or seek support in preparation for making a criminal referral to the FBI or local law enforcement. Denali has thus failed to meet its first-prong burden as to these allegations.
The same is true of the causes of action for negligent and intentional interference with prospective economic relations and for defamation. The causes of action for interference with economic relations allege that Denali used threats of criminal prosecution in order to obtain information about Thurber's business contacts. For the reasons we have already discussed, these alleged threats of litigation are protected by section 425.16. But in large part, the interference claims are based on different statements, specifically those Denali allegedly made to Thurber's business contacts and unspecified "others" after it obtained the names of the contacts. Marks alleges that Denali told the business contacts and others that Marks formed Clean Waste and Specialized Reuse to defraud Denali, that he skimmed funds from Denali, that he violated a fiduciary duty to Denali, that he reaped profits belonging to Denali, that he had admitted to stealing from Denali, and that he had left the company and was no longer in the industry. The defamation claims are based on the same statements to third parties.
Although these alleged statements touched on the subject of the alleged improprieties Denali was investigating, there is nothing to show Denali made them in an effort to seek assistance or support for that investigation, or for a proposed criminal referral. There is no allegation or evidence, in other words, that these statements were made" 'in furtherance of the right of petition or free speech.'" (Park, supra, 2 Cal.5th at p. 1063.) This case is thus distinct from Dove Audio, for the reasons discussed above. (See Dove Audio, supra, 47 Cal.App.4th at p. 782 ["communication was between a law firm and persons with potential claims, seeking support for the filing of a claim"].)
This case is also distinguishable from Contemporary Services Corp. v. Staff Pro Inc. (2007) 152 Cal.App.4th 1043 (Contemporary Services). The defendant there, Staff Pro Inc. (Staff Pro), and the plaintiff, Contemporary Services Corp. (CSC), had been opposed to each other in two earlier lawsuits. (Id. at pp. 1047-1048.) As the cases proceeded, Staff Pro's president sent an email to multiple people, apparently customers of both companies, telling them that, "[d]ue to [their] involvement with this case," he wished to update them on the court's findings. (Id. at pp. 1050, 1051.) The email accused CSC of paying former Staff Pro employees to make false statements in the litigation and of abusing the legal system in various ways. (Ibid.)
Based on these communications, CSC sued Staff Pro for, inter alia, defamation and intentional and negligent interference with economic advantage, and Staff Pro brought a special motion to strike. (Contemporary Services, supra, 152 Cal.App.4th at pp. 1050-1051.) The appellate court concluded the claims were based on conduct and statements protected by section 425.16. The email was a litigation update describing the parties' contentions and court rulings and was directed to individuals who had some involvement in the litigation. (Contemporary Services, at p. 1055.) The court explained," 'Both section 426.16 and Civil Code section 47 are construed broadly, to protect the right of litigants to" 'the utmost freedom of access to the courts without [the] fear of being harassed subsequently by derivative tort actions.'" [Citations.] Thus, it has been established for well over a century that a communication is absolutely immune from tort liability if it has" 'some relation'" to judicial proceedings.'" (Ibid.) Because the emails were made" 'in connection with an issue under consideration or review by a . . . judicial body,'" they were protected by the anti-SLAPP statute. (Contemporary Services, at p. 1055, quoting § 425.16, subd. (e)(2).)
Civil Code section 47, subdivision (b) establishes a privilege for publications or broadcasts in a judicial proceeding or any other official proceeding authorized by law.
Here, on the other hand, Denali's alleged communications concerned Marks's commercial conduct in the business community, rather than the conduct of an official proceeding. (Compare Contemporary Services, supra, 152 Cal.App.4th at p. 1050.) Nor is there any indication Denali was seeking information or support for any claims it might make. Marks does not allege, and Denali has not shown, any direct connection between the allegedly defamatory statements Denali made and the conduct of an official proceeding, existing or contemplated. We do not read Contemporary Services to mean that section 425.16 protects statements so far removed from an official proceeding. Denali has not met its burden to show they arose from activity protected by section 425.16.
To sum up our conclusions as to the first step of our analysis, the only allegations that fall within the scope of section 425.16 concern Denali's threats to prosecute Thurber or Marks criminally. As to those allegations, we must proceed to the second step of our analysis and determine whether Marks has met his burden to show" 'a probability he . . . will prevail on the claim[s] at trial, i.e., to proffer a prima facie showing of facts supporting a judgment in [his] favor.'" (Roberts v. Los Angeles County Bar Assn. (2003) 105 Cal.App.4th 604, 613.)
He has not made this showing. The trial court concluded, and we agree, that to the extent Marks's claims are based on statements by representatives of Denali threatening Marks with criminal prosecution, they are protected by the litigation privilege. This privilege applies not only to statements made in judicial proceedings, but also to communications related to"' "litigation that is contemplated in good faith and under serious consideration." '" (Malin v. Singer (2013) 217 Cal.App.4th 1283, 1300-1301; see Action Apartment Assn., Inc. v. City of Santa Monica (2007) 41 Cal.4th 1232, 1241 [privilege extends to steps before trial or other proceedings]; Civ. Code, § 47, subd. (b).)
Marks did not show below that Denali's threats of criminal prosecution, which were alleged not only in his cause of action for wrongful termination but also in his claims for interference with prospective economic advantage, were not related to litigation under serious consideration. Instead, the evidence establishes that as a result of its investigation Denali did seek criminal prosecution of Thurber and one other person, although not of Marks. To the extent Marks's claims rely on threats of prosecution as a basis for relief, he has not met his burden to demonstrate a probability that he will defeat the defense of the litigation privilege, and thus those allegations must be stricken from the complaint. (See Baral, supra, 1 Cal.5th at p. 396.) We shall direct the trial court to do so on remand.
That does not necessarily mean that evidence of those threats will be inadmissible at trial, or even that all allegations that mention the threats must be stricken if they also support a distinct claim that survives the anti-SLAPP motion. (See Baral, supra, 1 Cal.5th at p. 396 [allegations of protected activity may support claim not stricken under section 425.16].) But to the extent the protected 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," the allegations must be stricken. (Wilson, supra, 7 Cal.5th at p. 884.) Because the parties' briefs on appeal do not address whether any of the allegations of protected activity independently serve a proper purpose, we leave it to the trial court to determine in the first instance which allegations to strike.
Marks has also asked us to find the anti-SLAPP motion was frivolous or brought solely for purposes of delay, so as to allow him to seek an award of his costs and attorney fees. (§ 425.16, subd. (c)(1).) We recognize that Marks has obtained significant relief on appeal, but we decline this request.
DISPOSITION
The order granting in part the special motion to strike is reversed in part as set forth above. The matter is remanded for further proceedings consistent with the views expressed in this opinion.
In the interests of justice, the parties shall bear their own costs on appeal.
WE CONCUR: FUJISAKI, J., RODRÍGUEZ, J.