Opinion
NOT TO BE PUBLISHED
APPEAL from a judgment of the Superior Court of Los Angeles County, Ct. No. BC331516 James R. Dunn, Judge.
Law Offices of Eduardo Olivo; Eduardo Olivo, in pro. per. for Cross-complainant and Appellant.
Latham & Watkins, Russell F. Sauer, Kristine L. Wilkes, Colleen C. Smith, and Michael P. Pulos for Cross-defendant and Respondent.
DOI TODD, Acting P. J.
Cross-defendant and respondent the City of Vernon (City) terminated the employment of its City Attorney, cross-complainant and appellant Eduardo Olivo. In response to the City’s claim of malpractice, appellant brought a cross-complaint for wrongful termination. The trial court granted City summary adjudication on appellant’s causes of action for violation of Government Code section 12653 and Labor Code section 1102.5 on the ground that those claims could not be prosecuted or defended without disclosure of attorney-client privileged information.
We affirm. According to General Dynamics Corp. v. Superior Court (1994) 7 Cal.4th 1164, 1170 (General Dynamics), “in those instances where the attorney-employee’s retaliatory discharge claim is incapable of complete resolution without breaching the attorney-client privilege, the suit may not proceed.” Because the undisputed evidence showed that appellant could not maintain his statutory wrongful termination claims without disclosing matters contained in an attorney-client privileged report, the trial court properly concluded that those claims could not proceed.
FACTUAL AND PROCEDURAL BACKGROUND
Appellant’s Employment with the City.
The City is unique in that it is predominately industrial and has almost no residential population. The City Council serves as its legislative body; it receives recommendations from the City Administrator, establishes policies and receives reports from the City Administrator regarding the implementation of those policies. At all relevant times, Bruce Malkenhorst, Sr., served as the City Administrator. Since 1975, he has held multiple positions within the City; as City Administrator he received a generous compensation package which exceeded that of any other city chief executive officer in the state.
Beginning in 1982, appellant worked in several capacities for the City, both before and after he attended law school. In April 1999, the City retained appellant to serve as its assistant city attorney, and further agreed to retain appellant as its City Attorney effective October 1999. The agreement provided that appellant would receive a retainer for 40 hours of work per month, and be paid hourly for any time expended in excess of that amount. It further provided for a two-year term. In 2002, the City entered into an amended agreement with appellant, characterizing him as an employee of the City and thereby rendering him eligible to receive benefits through the California Public Employees’ Retirement System (CalPERS) as part of his compensation. As City Attorney, appellant reported to Malkenhorst.
In April 2002, two investigative reporters from the Los Angeles Times began visiting City Hall and, pursuant to the Public Records Act (Gov. Code, § 6250 et seq.) (PRA), requested the disclosure of documents related to City contracts and Malkenhorst’s compensation. Appellant responded to the PRA request on the City’s behalf. On the basis of his and the City staff’s review of City records, he advised that that much of the requested information did not exist. In particular, he reaffirmed that the City had provided all information relating to Malkenhorst’s expenses. But by late 2002, appellant had reviewed additional documents that revealed the responses he had provided to the Los Angeles Times concerning Malkenhorst’s expenses were false. Between September 2002 and July 2003, appellant unsuccessfully tried to obtain documents to correct what he believed were prior misrepresentations.
In September 2003, Malkenhorst met with appellant to advise him that the City was interested in making a change and wanted Eric Fresch to serve as City Attorney. Malkenhorst told appellant that he and the City Council were upset by appellant’s repeated efforts to correct the information provided to the Los Angeles Times. In October 2003, appellant’s title was changed from “City Attorney” to “Legal Counsel.” While Fresch became the City Attorney, appellant continued to provide legal services for the City. Though appellant continued to inquire about the PRA matter, Fresch advised him that he was in the process of destroying records relating to expense matters.
In June 2004, the City gave appellant notice of termination of his employment agreement and informed appellant that, six months from the date of the letter, he would be considered an independent consultant. Thereafter, in the context of providing legal services for the City, appellant prepared an 85-page report (Report) summarizing the results of his investigation of the City’s financial matters, which he submitted to the City Council on September 3, 2004. Letters written by appellant addressing unrelated topics as well as Los Angeles Times articles referred to the Report’s caption as “Report on City Administrator’s Misappropriation of Public Funds through the Misuse of the City Petty Cash and City Credit Card Process Use.” Appellant indicated that he prepared the Report because he did not want to be accused of participating in criminal or unethical conduct. Appellant billed the City, and the City paid appellant for the time he spent preparing the Report in August and September 2004.
According to the minutes of the September 15, 2004 City Council meeting, the Mayor advised that a matter had been brought to his attention that needed to be discussed at the meeting. The Mayor stated: “‘The City Council members have received a document with attached exhibits from Eddie Olivo. After reviewing the document, it is my opinion that this matter should be looked into by outside counsel and specifically by Kirkpatrick & Lockhart. If the Council agrees, I would ask that Mr. Richard Crane of Kirkpatrick & Lockhart be directed to immediately begin a review of this matter, with direction that the firm reports directly to the City Council.’” After the City Council members concurred with the recommendation, the Mayor continued: “‘This appears to be a matter that has been exhaustively investigated and the work of a disgruntled employee. If I remember correctly, Mr. Olivo was directed, in writing, to stop using City letterhead and stop referring to himself as Legal Counsel. This memorandum from Mr. Olivo is on City letterhead and Mr. Olivo refers to himself as Legal Counsel. Again, with the concurrence of the City Council, it would seem prudent to have Mr. Olivo removed from any and all matters as legal counsel for the City.’” The City Council members again indicated their concurrence. The balance of the discussion involved a request that staff direct appellant to return all original files to the deputy city attorney. Discussing the Report had not appeared on the previously-posted meeting agenda.
The next day, Crane sent appellant a letter informing him that on the basis of the City Council’s review of the Report, “the City Council for the City of Vernon (the ‘City’) has concluded that the matters reflected in the Report, among other reasons, create a substantial impediment to your ability to work with City Staff as would be necessary for you to effectively represent the City as legal counsel on any matters. As a result of that determination, on September 15, 2004 the City Council unanimously directed Kirkpatrick & Lockhart LLP (‘K&L’) to inform you that you have been relieved of all duties as counsel to and/or for the City.” The letter further indicated that the City would honor the financial terms of appellant’s employment contract through the end of the contract term and, in turn, stated that it expected appellant to honor his professional and ethical obligations to the City. The City asked appellant to transfer all files to a deputy city attorney and to execute substitutions of counsel as necessary. After appellant did not respond to the City’s written request to return City documents, the City sent appellant a PRA request. Appellant, too, submitted a PRA request seeking disclosure of City Council and Finance Committee agendas.
In connection with a November 2004 letter from the City to appellant to address matters related to appellant’s termination effective December 14, 2004, the City enclosed a draft complaint for legal malpractice and breach of contract against appellant.
Prior Actions.
In March 2005, appellant filed a petition for writ of mandate seeking a determination that certain documents, including the Report, were public records under the PRA. Though the trial court granted the petition in part with respect to a limited number of documents, it denied the petition with respect to the Report “on the grounds that the Report, Exhibits and four (4) volumes of supporting documents which accompany the Report and the other documents sought by these requests constitute attorney-client privileged communications, the privilege was not waived and, therefore, these documents are exempt from disclosure under Section 6254(k) of the California Public Records Act.” The Court of Appeal denied a petition for writ of mandate challenging that order.
Further, in a November 2005 order in a criminal proceeding, the trial court granted in part the City’s motion to return and suppress evidence seized pursuant to two search warrants to the extent the motion was directed to the Report and its attachments. It ruled that the Report was a confidential communication between appellant and the City, as it was prepared and submitted during the course of the attorney-client relationship. The trial court further reasoned that no exceptions to the privilege applied. It found that the Report’s attachments-though not the separately bound volumes of City documents submitted with the Report-were also protected by the work product privilege.
Pleadings and Summary Judgment Motion.
In April 2005, the City filed a complaint against appellant which alleged claims for legal malpractice, violation of the False Claims Act and fraud arising out of several transactions captioned the Kenko matter, the RMI matter, the Sterling Davis matter, the Sperry West matter and the Scott Company matter. In June 2005, the City filed a first amended complaint adding allegations that appellant provided unnecessary and/or substandard services in connection with the Sterling Davis and Sperry West matters, and adding legal malpractice, False Claims Act and fraud allegations related to the Mirant matter. Appellant demurred, and the City thereafter filed a second amended complaint, with allegations limited to legal malpractice in connection with the Kenko, RMI, Scott Company and Mirant matters. Appellant answered, specifically denying the allegations and asserting affirmative defenses.
In August 2005, appellant cross-complained against the City and multiple individuals alleging several causes of action including wrongful termination in violation of Government Code section 12653 and Labor Code section 1102.5. Appellant alleged that he was unlawfully terminated for submitting the Report which detailed alleged misconduct by City officials. The trial court sustained in part and overruled in part demurrers to the cross-complaint. Appellant thereafter voluntarily dismissed two causes of action. The City answered the cross-complaint, specifically admitting and denying certain allegations and asserting numerous affirmative defenses.
Because the cross-complaint has been filed under seal, we are precluded from reciting the factual basis for appellant’s allegations except to the extent that information appears elsewhere in the unsealed portion of the record or in the briefs. (See Cal. Rules of Court, rule 8.46(g).)
The City sought an order sealing specific privileged documents, including the Report, pursuant to Evidence Code section 452, subdivision (d).
In September 2007, the City moved for summary judgment and alternatively for summary adjudication on the cross-complaint. It asserted that appellant was unable to establish his wrongful termination claims as a matter of law because they could neither be prosecuted nor defended without disclosure of attorney-client privileged information; the City was immune from liability; appellant was not an employee of the City; the failure to renew an agreement was an inadequate basis for the claims; and there was no nexus between appellant’s termination and his engaging in any protected activity. As to appellant’s contract claims, the City asserted there was no evidence of a breach. In support of the motion, the City sought judicial notice of declarations submitted in connection with prior motions, deposition excerpts, rulings issued in related matters and legislative history. It also offered declarations from City employees.
Appellant opposed the motion. In support of his opposition, he submitted his own declaration as well as multiple exhibits comprised of correspondence, deposition excerpts, legal bills and newspaper articles. He also sought judicial notice of pleadings and declarations filed in other actions. In connection with his opposition, appellant filed evidentiary objections to the declarations submitted in support of the motion, which the trial court sustained in part and overruled in part. In turn, the City filed evidentiary objections to portions of appellant’s evidence-primarily appellant’s declaration and the declaration of a City employee.
The trial court initially heard the motion on February 8, 2008, and continued the matter to allow both appellant and the City to present further argument and authority on the issues of the City’s immunity, appellant’s ability to establish his case without the use of attorney-client privileged information and the City’s possible waiver of the privilege. Following the submission of supplemental briefs, the trial court denied the motion for summary judgment but granted summary adjudication on appellant’s first through third causes of action for wrongful termination. The trial court denied summary adjudication on appellant’s breach of contract claims, because the evidence was disputed as to whether any amounts remained due and owing to appellant.
With respect to appellant’s causes of action for wrongful termination under Government Code section 12653, Labor Code section 1102.5 and Government Code section 9149.20, the trial court characterized the claims as setting up “the clash between the public policies in favor of encouraging whistle-blowing on the one hand, and the longstanding public policy of preserving as sacrosanct the attorney-client privilege on the other, ” and ruled “that as an in-house employee attorney for the City Mr. Olivo is without a remedy for his claims of wrongful termination, as the overarching policy in favor of protecting communications protected by the attorney-client privilege prevails.” Turning to the pleadings, the trial court observed that appellant had alleged he was terminated for preparing and submitting the Report to the City. It found no basis to depart from previous trial court rulings finding the Report privileged. Relying on General Dynamics, supra, 7 Cal.4th 1164, the trial court reasoned that the undisputed evidence did not establish any of the limited circumstances under which an in-house attorney may bring an action for wrongful termination and, in doing so, depart from his obligation to preserve attorney-client confidences. It further found that the matter could not be resolved through the utilization of techniques such as a protective order, concluding “that the case ‘is incapable of complete resolution without breaching the attorney-client privilege....’”
The trial court declined to rule on the City’s evidentiary objections on the ground that any ruling would not affect its decision.
Judgment.
Appellant and the City proceeded to trial on the legal malpractice claim alleged by the City, and a jury returned a general verdict in favor of appellant. They then proceeded to trial on the remaining breach of contract causes of action in the cross-complaint. A jury found in favor of appellant and awarded him $75,000 plus prejudgment interest.
The trial court entered judgment on the complaint and cross-complaint in accordance with the verdicts and rulings on demurrer and summary adjudication. Appellant appealed from the summary adjudication of the first and second causes of action only.
DISCUSSION
Appellant challenges summary adjudication on the grounds that the trial court misapplied the law concerning the question of privilege and that, even if the law had been correctly applied, a triable issue of fact existed as to whether exceptions to the privilege applied or the privilege was waived by the City. We find no merit to these challenges.
I. Standard of Review.
We review a grant of summary adjudication de novo. (Wiener v. Southcoast Childcare Centers, Inc. (2004) 32 Cal.4th 1138, 1142.) Summary adjudication of a cause of action is warranted where “all the papers submitted show that there is no triable issue as to any material fact and that the moving party is entitled to a judgment as a matter of law....” (Code Civ. Proc., § 437c, subds. (c), (f).) A defendant moving for summary adjudication meets this burden by presenting evidence demonstrating that one or more elements of the cause of action cannot be established or that there is a complete defense to the action. (Code Civ. Proc., § 437c, subd. (p)(2); Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826, 853–854.) Once the defendant makes this showing, the burden shifts to the plaintiff to show the existence of a triable issue of material fact as to that cause of action or defense. (Code Civ. Proc., § 437c, subd. (p)(2); see Aguilar v. Atlantic Richfield Co., supra, at p. 850.) To determine whether the parties have met their respective burdens, we consider “‘all of the evidence set forth in the [supporting and opposition] papers, except that to which objections have been made and sustained by the court, and all [uncontradicted] inferences reasonably deducible from the evidence.’” (Artiglio v. Corning Inc. (1998) 18 Cal.4th 604, 612.) A plaintiff opposing summary adjudication cannot rely upon the mere allegations or denials of its pleadings, but “shall set forth the specific facts” based on admissible evidence showing a triable issue exists. (Code Civ. Proc., § 437c, subd. (p)(2); Borders Online v. State Bd. of Equalization (2005) 129 Cal.App.4th 1179, 1188.)
Although our review is de novo, “it is limited to issues which have been adequately raised and supported in [appellant’s] brief.” (Reyes v. Kosha (1998) 65 Cal.App.4th 451, 466, fn. 6.)
II. Legal Principles Applicable to a Retaliatory Discharge Claim by In-House Counsel.
In Fracasse v. Brent (1972) 6 Cal.3d 784, 790, our Supreme Court confirmed the proposition that “a client should have both the power and the right at any time to discharge his attorney with or without cause.” Thereafter, in General Dynamics, supra, 7 Cal.4th 1164, the court considered whether clients possess the same unqualified right to discharge in-house counsel. In view of the economic dependence of in-house counsel-a feature making them more akin to nonattorney employees than outside counsel-the Court concluded that some limited remedy was necessary. It recognized, though, that the establishment of such a right must be balanced against the client’s right to have its confidences protected. Accordingly, in finding that in-house counsel may maintain a retaliatory discharge claim, the court explained: “Our conclusion with respect to the tort cause of action is qualified; our holding seeks to accommodate two conflicting values, both of which arise from the nature of an attorney’s professional role-the fiducial nature of the relationship with the client, on the one hand, and the duty to adhere to a handful of defining ethical norms, on the other. As will appear, we conclude that there is no reason inherent in the nature of an attorney’s role as in-house counsel to a corporation that in itself precludes the maintenance of a retaliatory discharge claim, provided it can be established without breaching the attorney-client privilege or unduly endangering the values lying at the heart of the professional relationship.” (Id. at p. 1169.)
As an alternative basis for affirming summary adjudication, the City argues that the undisputed evidence showed appellant operated as outside counsel and thus could be terminated for any reason or no reason. The trial court found just the opposite, ruling that the undisputed evidence showed appellant was an employee of the City. At a minimum, the evidence was in dispute, though the weight of the evidence established that appellant was an employee for all purposes. Because appellant offered sufficient evidence to raise a triable issue of fact as to whether he was an employee, we evaluate his claims as they would apply to in-house counsel.
In carving out a limited right for in-house counsel to maintain a retaliatory discharge action, the court was mindful of a series of cases in other jurisdictions that declined to permit in-house counsel to pursue such a claim. (Accord, Fox Searchlight Pictures, Inc. v. Paladino (2001) 89 Cal.App.4th 294, 309 [observing that courts in some jurisdictions have refused to permit suits by in-house counsel against their clients, because they concluded it is impossible to meet the challenge of maintaining an attorney’s professional obligations to a client while simultaneously permitting an attorney to enjoy the protections afforded nonattorney employees].) General Dynamics reasoned that the decisions disallowing retaliatory discharge claims rested on two grounds: “First, because the fiducial qualities of their professional calling pervade the attorney-client relationship-‘lawyers are different.’ It is essential to the proper functioning of the lawyer’s role that the client be assured that matters disclosed to counsel in confidence remain sacrosanct; to permit in-house attorneys to file suit against their clients can only harm that relationship. Second, to the extent that the retaliatory discharge tort rests on underpinnings designed to secure fundamental public policies, a tort remedy for in-house counsel is redundant-such attorneys are under an ethical obligation to sever their professional relationship with the erring client in any event-meaning, in the case of in-house counsel, resigning their employment.” (General Dynamics, supra, 7 Cal.4th at pp. 1184–1185.) The General Dynamics court rejected this reasoning, finding no link between the ethical duties of in-house counsel and the court’s refusal to permit counsel a remedy when those professional obligations are directly implicated. (Id. at p. 1185.)
Rather, the court determined that it was precisely because of in-house counsel’s ethical constraints “that attorneys should be accorded a retaliatory discharge remedy in those instances in which mandatory ethical norms embodied in the Rules of Professional Conduct collide with illegitimate demands of the employer and the attorney insists on adhering to his or her clear professional duty.” (General Dynamics, supra, 7 Cal.4th at p. 1186.) In addition to claims involving in-house counsel’s refusal to violate a mandatory ethical duty, the court further determined that “judicial access ought logically extend to those limited circumstances in which in-house counsel’s nonattorneycolleagues would be permitted to pursue a retaliatory discharge claim and governing professional rules or statutes expressly remove the requirement of attorney confidentiality.” (Id. at p. 1188.) Thus, where the attorney’s conduct is merely ethically permissible, but not mandated, the court may permit a retaliatory discharge action if “the employer’s conduct is of the kind that would give rise to a retaliatory discharge action by a non attorney employee” for violation of a fundamental public policy, and if “some statute or ethical rule, such as the statutory exceptions to the attorney-client privilege codified in the Evidence Code (see id., §§ 956–958) specifically permits the attorney to depart from the usual requirement of confidentiality with respect to the client-employer and engage in the ‘nonfiduciary’ conduct for which he was terminated.” (General Dynamics, supra, at p. 1189.)
In emphasizing “the limited scope of [its] conclusion that in-house counsel may state a cause of action in tort for retaliatory discharge, ” the General Dynamics court continued to state that “in addition to the limitations on the scope of the retaliatory tort action mentioned above, the concerns expressed by the courts [declining to permit in-house counsel to maintain a retaliatory discharge action] for the integrity of the fiduciary aspects of the attorney-client relationship impose additional limitations.” (General Dynamics, supra, 7 Cal.4th at p. 1189.) Describing the nature of those additional limitations, the court stated: “[T]he in-house attorney who publicly exposes the client’s secrets will usually find no sanctuary in the courts. Except in those rare instances when disclosure is explicitly permitted or mandated by an ethics code provision or statute, it is never the business of the lawyer to disclose publicly the secrets of the client. In any event, where the elements of a wrongful discharge in violation of fundamental public policy claim cannot, for reasons peculiar to the particular case, be fully established without breaching the attorney-client privilege, the suit must be dismissed in the interest of preserving the privilege.” (Id. at p. 1190.)
Further explaining that “the contours of the statutory attorney-client privilege should continue to be strictly observed, ” the court declined to find that “the scope of the privilege should be diluted in the context of in-house counsel and their corporate clients.” (General Dynamics, supra, 7 Cal.4th at p. 1190.) The court reasoned “that many of the cases in which in-house counsel is faced with an ethical dilemma will lie outside the scope of the statutory privilege. Matters involving the commission of a crime or a fraud, or circumstances in which the attorney reasonably believes that disclosure is necessary to prevent the commission of a criminal act likely to result in death or substantial bodily harm, are statutory and well-recognized exceptions to the attorney-client privilege. [Citations.]” (Id. at pp. 1190–1191.)
Courts construing General Dynamics have reaffirmed the overriding importance of protecting the attorney-client privilege in the context of a retaliatory termination action brought by counsel. In Solin v. O’Melveny & Myers (2001) 89 Cal.App.4th 451 (Solin), plaintiff attorney Solin sought the advice of the law firm of O’Melveny & Myers (firm) regarding the representation of his clients. In the context of seeking that advice, he disclosed privileged and confidential information (secrets) about the clients that implicated them in criminal activity. (Id. at p. 453.) Solin later brought a malpractice action against the firm, alleging that it failed to advise him of pertinent legal authority. The client intervened to seek dismissal of the action to prevent disclosure of the secrets. The appellate court affirmed the trial court’s dismissal of the action on the ground that the firm could not effectively defend the action without disclosing the secrets. (Id. at pp. 454, 456.)
The court reiterated the broad principle established by General Dynamics, explaining that case “teaches[] unless a statutory provision removes the protection afforded by the attorney-client privilege to confidential communications between attorney and client, an attorney plaintiff may not prosecute a lawsuit if in doing so client confidences would be disclosed. [Citation.]” (Solin, supra, 89 Cal.App.4th at p. 458.) It explicitly extended this principle to the defense of such a lawsuit, reasoning that simple notions of due process required that the firm be able to defend itself with all relevant information on which it based its legal advice to the plaintiff. (Id. at pp. 463–464.) Characterizing the issues in dispute as what the plaintiff disclosed and why, what legal advice the firm rendered to him and why, how the plaintiff’s disclosures shaped and influenced that legal advice, and how the firm’s legal advice affected the plaintiff’s structuring a retainer agreement with the clients, it concluded that resolution of those issues depended primarily on the credibility of the parties to the plaintiff/law firm consultation. (Id. at p. 466.) The court agreed with the firm that “it must be free to recite the precise factual scenario which Solin presented to [the firm], including Solin’s concerns about the Clients’ involvement in criminal activities.” (Ibid.) It reasoned that only by disclosing what the plaintiff communicated could the firm cogently explain the reasons for the advice it gave. (Ibid.) Because the lawsuit was incapable of resolution without such disclosure, the appellate court affirmed the dismissal. (Id. at p. 467.)
More recently, the court in Dietz v. Meisenheimer & Herron (2009) 177 Cal.App.4th 771 (Dietz) addressed a dispute involving a claim brought by plaintiff attorney Dietz against a firm to whom he had referred a bad faith insurance litigation matter involving his client. Though the court ultimately concluded that the plaintiff could maintain his claim because the firm did not need to rely on attorney-client privileged information to support its defense, the court confirmed “the proposition that a lawyer plaintiff may not rely on privileged information in proving the elements of his or her claims. In determining whether a lawyer can satisfy his or her burden of proof, no balancing is permitted, and dismissal is required if the plaintiff cannot satisfy his or her burden of proof without resort to disclosing privileged or confidential information. [Citation.]” (Id. at p. 791.)
With these principles in mind, we turn to the issues and evidence presented by the summary adjudication motion.
II. The Trial Court Properly Granted Summary Adjudication on Appellant’s Retaliatory Discharge Claims.
A. The Report was Protected by the Attorney-client Privilege.
Evidence Code section 952 defines a “‘confidential communication between client and lawyer’” as “information transmitted between a client and his or her lawyer in the course of that relationship and in confidence by a means which, so far as the client is aware, discloses the information to no third persons....” In turn, Evidence Code section 954 provides that “the client, whether or not a party, has a privilege to refuse to disclose, and to prevent another from disclosing, a confidential communication between client and lawyer....”
In Costco Wholesale Corp. v. Superior Court (2009) 47 Cal.4th 725, our high court described the significant role of the attorney-client privilege: “The privilege ‘has been a hallmark of Anglo-American jurisprudence for almost 400 years.’ [Citation.] Its fundamental purpose ‘is to safeguard the confidential relationship between clients and their attorneys so as to promote full and open discussion of the facts and tactics surrounding individual legal matters. [Citation.]... [¶] Although exercise of the privilege may occasionally result in the suppression of relevant evidence, the Legislature of this state has determined that these concerns are outweighed by the importance of preserving confidentiality in the attorney-client relationship. As this court has stated: “The privilege is given on grounds of public policy in the belief that the benefits derived therefrom justify the risk that unjust decisions may sometimes result from the suppression of relevant evidence.” [Citations.]’ [Citation.] ‘[T]he privilege is absolute and disclosure may not be ordered, without regard to relevance, necessity or any particular circumstances peculiar to the case.’ [Citation.]” (Id. at p. 732.) The importance of maintaining client confidences is also codified in Business and Professions Code section 6068, subdivision (e)(1), which imposes a duty on an attorney “[t]o maintain inviolate the confidence, and at every peril to himself or herself to preserve the secrets, of his or her client.”
In finding the Report protected by the attorney-client privilege, the trial court stated that it agreed with the two prior determinations that the Report was privileged and concluded: “The investigation was conducted and the Report was prepared by Mr. Olivo while he was an attorney for [the City] and the Report was presented to the City in connection with his giving of legal advice to the City.” In connection with the denial of appellant’s petition for writ of mandate seeking to have the Report declared a public record, the trial court characterized appellant’s petition as admitting the Report was an attorney-client communication. Here, too, appellant proffered no evidence to raise a triable issue of fact concerning application of the privilege.
A communication made in confidence during the course of an attorney-client relationship is presumed to be protected by the attorney client-privilege. (Evid. Code, § 917, subd. (a).) Appellant, as in-house counsel for the City, had an attorney-client relationship with his employer. (Gutierrez v. G & M Oil Co., Inc. (2010) 184 Cal.App.4th 551, 559.) According to appellant’s declaration, during the course of that relationship he prepared the Report and caused the Report to be disseminated only to City Council members. Appellant offered no evidence to suggest that the information contained in the Report was obtained from sources outside the scope of his employment. Accordingly, there was no evidence to rebut the presumption that the Report was a confidential communication as defined in Evidence Code section 952.
“While it is perhaps somewhat of a hyperbole to refer to the attorney-client privilege as ‘sacred, ’ it is clearly one which our judicial system has carefully safeguarded with only a few specific exceptions.” (Mitchell v. Superior Court (1984) 37 Cal.3d 591, 600, fn. omitted; see also Wells Fargo Bank v. Superior Court (2000) 22 Cal.4th 201, 206 [“The privileges set out in the Evidence Code are legislative creations; the courts of this state have no power to expand them or to recognize implied exceptions”].) The trial court expressly concluded that the Report was not subject to any exception to the attorney-client privilege. Appellant contends that the trial court erred in declining to find that at least one of two exceptions codified in Evidence Code sections 956 and 958 applied to the Report. We find no error.
Evidence Code section 956, commonly known as the crime/fraud exception, provides that “[t]here is no privilege under this article if the services of the lawyer were sought or obtained to enable or aid anyone to commit or plan to commit a crime or a fraud.” To invoke the crime/fraud exception, the proponent must make a prima facie showing that the services of the attorney were sought or obtained to aid someone in committing a crime or fraud. (BP Alaska Exploration, Inc. v. Superior Court (1988) 199 Cal.App.3d 1240, 1262.) “Evidence Code section 956 does not require a completed crime or fraud. It applies to attorney communications sought to enable the client to plan to commit a fraud, whether the fraud is successful or not.” (Ibid.; see also Travelers Ins. Companies v. Superior Court (1983) 143 Cal.App.3d 436, 446 [communication must be “‘made in contemplation of crime’” for exception to apply].) Where the client has already committed a wrongdoing and confesses the matter to the attorney, the information exchanged between the two is privileged. (State Farm Fire & Casualty Co. v. Superior Court (1997) 54 Cal.App.4th 625, 644.)
Appellant’s declaration contained no information to establish that the City sought to enlist appellant’s services for the commission of a crime. Rather, according to appellant, he was unaware of Malkenhorst’s falsely claimed expenses until he conducted an independent investigation and learned that the records he reviewed were false. Indeed, appellant declared that he had been completely unaware of any wrongdoing, averring that he was concerned about the documents he had produced to the Los Angeles Times because he “could be accused of misconduct in public office or other crimes.” He further averred that he prepared the Report because he did not want to be accused of participating in what he believed to have been criminal or unethical conduct. Under these circumstances, Evidence Code section 956 did not apply to the Report.
Appellant’s only statement even arguably involving the future commission of a crime was his summary of a conversation with Fresch in May 2004, where Fresch indicated that he was in the process of destroying documents regarding expense matters and advised appellant that he should cooperate and “get rid of the documents.” We decline to find that this statement falls within Evidence Code section 956, however, because a court may not require disclosure of privileged information in order to rule on a claim of privilege. (Evid. Code, § 915, subd. (a); State Farm Fire & Casualty Co. v. Superior Court, supra, 54 Cal.App.4th at p. 645.) Instead, evidence must be presented showing that the client’s purpose was to seek the aid of the attorney in committing the crime or fraud before disclosure of the privileged information will be ordered. (Nowell v. Superior Court (1963) 223 Cal.App.2d 652, 657.) Because appellant offered no evidence beyond attorney-client privileged information to support the application of Evidence Code section 956 with respect to his exchange with Fresch, we cannot conclude that the exception applies even to that limited statement.
We note that appellant’s declaration in this regard differs significantly from his verified complaint filed under seal.
Appellant requests that we take judicial notice of certain public records relating to the subsequent prosecution of Malkenhorst and City Mayor Leonis Malberg. While we grant appellant’s request pursuant to Evidence Code sections 452, subdivision (d)(1) and 459, as the documents are state court records, we cannot conclude that the documents may serve as the additional evidence sufficient to support application of Evidence Code section 956. As a threshold matter, though a court may take judicial notice of public records, it does not judicially notice the truth of all matters stated therein. (People v. Castillo (2010) 49 Cal.4th 145, 157.) Moreover, in our review of summary adjudication, we may consider only the evidence that was properly before the trial court at the time of its ruling. (L&B Real Estate v. Superior Court (1998) 67 Cal.App.4th 1342, 1346.) The judicially noticed documents were not before the trial court, or even existed, at the time it ruled on the summary adjudication motion.
Nor can we conclude that Evidence Code section 958 applies to abrogate the privilege. The statute provides: “There is no privilege under this article as to a communication relevant to an issue of breach, by the lawyer or by the client, of a duty arising out of the lawyer-client relationship.” The statute has a limited application. “Evidence Code section 958 provides a specific exception to the attorney-client privilege, under which a lawyer accused of malpractice may disclose his confidential communications with his disgruntled client insofar as they bear on the claim of professional negligence.” (Samuels v. Mix (1999) 22 Cal.4th 1, 27, fn. 4.) The purpose of the exception is to give the attorney charged with malpractice a meaningful opportunity to defend against the charge. (Brockway v. State Bar (1991) 53 Cal.3d 51, 63–64.) “[T]he statute is not a general client-litigant exception allowing disclosure of any privileged communication simply because it is raised in litigation.” (Id. at p. 63.)
We find no authority for appellant’s seeking to invoke Evidence Code section 958 for the purpose of prosecuting his statutory wrongful termination claims. Even if the exception had some limited application because the City alleged a claim for legal malpractice against appellant in its complaint, it would not apply to the affirmative claims alleged by appellant in the cross-complaint. As explained in McDermott, Will & Emery v. Superior Court (2000) 83 Cal.App.4th 378, 383–384, “the filing of a legal malpractice action against one’s attorney results in a waiver of the privilege, thus enabling the attorney to disclose, to the extent necessary to defend against the action, information otherwise protected by the attorney-client privilege.” Because the City’s claims in its complaint did not allege misconduct relating to the preparation of the Report, disclosure of matters necessary to defend against the City’s action would not extend to the Report.
Finally, we find no evidence to support appellant’s suggestion that the City waived the privilege. Pursuant to Evidence Code section 912, subdivision (a), “the right of any person to claim a privilege provided by Section 954 (lawyer-client privilege).... is waived with respect to a communication protected by the privilege if any holder of the privilege, without coercion, has disclosed a significant part of the communication or has consented to disclosure made by anyone.” Here, only the title of the Report has been disclosed. The City has never disclosed the contents of the document and, at every opportunity, has asserted that the Report is confidential attorney-client communication. Under these circumstances, we cannot conclude that a significant part of the Report has been disclosed so as to create a triable issue regarding waiver. (See Southern Cal. Gas Co. v. Public Utilities Com. (1990) 50 Cal.3d 31, 46–48 [no waiver of attorney-client privilege as to entire communication where client disclosed the fact of an attorney’s review of a contract and the conclusion the attorney reached]; Mitchell v. Superior Court, supra, 37 Cal.3d at p. 602 [no waiver of attorney-client privilege where client acknowledged the existence of certain confidential discussions but did not disclose the actual substance or content of those discussions].)
Accordingly, we find no basis to disturb the trial court’s conclusion that the Report was a privileged document.
B. Appellant’s Claims Were Incapable of Resolution Without the Disclosure of Attorney-Client Privileged Information.
“[A]n attorney plaintiff may not establish a claim through the disclosure of privileged information. [Citation.]” (Dietz, supra, 177 Cal.App.4th at p. 791.) The question therefore becomes whether disclosure of the Report was necessary for appellant to establish his first two causes of action. We find no basis to disturb the trial court’s answer to that question that enforcement of the privilege prevents appellant from resolving his wrongful termination claims.
1. Appellant’s causes of action.
The pleadings frame the issues on summary adjudication. (Heritage Marketing & Ins. Services, Inc. v. Chrustawka (2008) 160 Cal.App.4th 754, 764.) To the extent possible given that the cross-complaint has been filed under seal, we therefore turn first to the allegations supporting appellant’s first and second causes of action.
Appellant brought his first wrongful termination cause of action pursuant to the False Claims Act (Gov. Code, § 12650 et seq.). He relied on Government Code section 12653, subdivision (b), which provides: “No employer shall discharge, demote, suspend, threaten, harass, deny promotion to, or in any other manner discriminate against, an employee in the terms and conditions of employment because of lawful acts done by the employee on behalf of the employee or others in disclosing information to a government or law enforcement agency or in furthering a false claims action, including investigation for, initiation of, testimony for, or assistance in, an action filed or to be filed under Section 12652.” To be considered activity protected under the False Claims Act, “the employee’s conduct must be in furtherance of a false claims action. [Citation.] The employee does not have to file a false claims action or show a false claim was actually made; however, the employee must have reasonably based suspicions of a false claim and it must be reasonably possible for the employee’s conduct to lead to a false claims action. [Citations.]” (Kaye v. Board of Trustees of San Diego County Public law Library (2009) 179 Cal.App.4th 48, 60.) In other words, “‘[s]aber-rattling is not protected conduct.’” (Ibid.)
According to appellant, sometime in 2002 he discovered that he had made false representations to the Los Angeles Times regarding Malkenhorst’s expenses. After repeated exchanges concerning the misinformation, in 2004 appellant “advised Fresch that the City’s public records appeared to reflect numerous false claims and that [Fresch] and the City could not leave [him] in a position of having misinformed the Times about the City’s public records.” According to appellant, he thereafter submitted the Report to the City Council. He caused the Report to be disseminated only to the City Council, though he added that his subjective motivation for doing so was because he did not want to be accused of participating in criminal or unethical conduct. After appellant submitted the Report, he contended the City took the adverse employment action against him.
Appellant’s second cause of action alleged a violation of Labor Code section 1102.5. In pertinent part, that statute provides: “An employer may not retaliate against an employee for disclosing information to a government or law enforcement agency, where the employee has reasonable cause to believe that the information discloses a violation of state or federal statute, or a violation or noncompliance with a state or federal rule or regulation.” (Lab. Code, § 1102.5, subd. (b).) Subdivision (e) explains that “[a] report made by an employee of a government agency to his or her employer is a disclosure of information to a government or law enforcement agency pursuant to subdivisions (a) and (b).” (Lab. Code, § 1102.5, subd. (e).)
In order to establish a prima facie case of retaliation under the statute, a plaintiff must show that he engaged in a protected activity, his employer subjected him to an adverse employment action and there is a causal link between the two. (Patten v. Grant Joint Union High School Dist. (2005) 134 Cal.App.4th 1378, 1384.) “An employee engages in protected activity when she discloses to a governmental agency ‘“reasonably based suspicions” of illegal activity.’ [Citation.]” (Mokler v. County of Orange (2007) 157 Cal.App.4th 121, 138.) The employee must have an actual belief that the employer’s actions were unlawful and the employee’s belief, even if mistaken, must be reasonable. (Carter v. Escondido Union High School Dist. (2007) 148 Cal.App.4th 922, 933–934.)
Accordingly, the essence of both of appellant’s claims was that he was terminated for engaging in protected activity in the form of disclosing information concerning a false claim and illegal activity on the part of the City.
2. The undisputed evidence showed that appellant could not establish his claims without disclosure of the Report.
Although the pleadings frame the issues, verified pleadings may not be used to support or oppose summary adjudication. (Salma v. Capon (2008) 161 Cal.App.4th 1275, 1290; accord, Gallant v. City of Carson (2005) 128 Cal.App.4th 705, 710 [“‘“a party cannot simply rely on the allegations in its own pleadings, even if verified, to make the evidentiary showing required in the summary judgment context or similar motions”’”].) Accordingly, our inquiry turns to the evidence submitted in support of and in opposition to the summary adjudication motion.
The undisputed evidence very narrowly established that the only disclosure of false claims or illegal activity involved appellant’s submission of the Report to the City Council. According to the City’s termination letter to appellant submitted in support of the motion, the City’s outside counsel stated: “Based on the City Council’s review of your report dated September 3, 2004, entitled... (the ‘Report’), the City Council for the City of Vernon (the ‘City’) has concluded that the matters reflected in that Report, among other reasons, create a substantial impediment to your ability to work with City staff as would be necessary for you to effectively represent the City as legal counsel on any matters.” The evidence offered in opposition to the motion likewise established that appellant’s preparation and submission of the Report triggered the adverse employment actions against him. The declaration of City employee Gloria Molleda provided that after the Mayor had reviewed the Report and formed the opinion it was wrong or false, “[t]he City Council then determined that, based on the content of the report, that they would remove Mr. Olivo from his position as Legal Counsel for the City.” In a supplemental declaration submitted in opposition to the summary adjudication motion, appellant, himself, declared that the City terminated him “for the matters reflected in the Report [c]ritical of the City of Vernon.” This declaration was consistent with a declaration he had earlier submitted in opposition to the City’s request to seal records, including the Report, in which he averred that he was terminated “‘based upon the matters reflected in the Report[.]’”
Confirming the undisputed nature of the evidence, in response to the City’s separate statement of material facts, appellant responded it was “undisputed” that “Olivo’s claims are based upon his allegations that he was [un]lawfully discharged for submitting the Report to the City Council on or about September 3, 2004” and that “Olivo’s claims are based upon his allegations that he [was] unlawfully terminated for submitting the report (the ‘Report’) detailing alleged misconduct in the City.” Indeed, appellant offered no evidence to create a triable issue of fact concerning the preparation and submission of the Report as being the basis for his termination. (See Cal. Rules of Court, rule 3.1350(f) [an “opposing party who contends that a fact is disputed must state, on the right side of the page directly opposite the fact in dispute... the evidence that supports the position that the fact is controverted”].)
In view of the undisputed evidence, we must reach the same inescapable conclusion as the trial court that appellant’s claims cannot proceed without breach of the attorney-client privilege. Only the contents of the Report would reveal the information that appellant disclosed concerning the alleged false claims (Gov. Code, § 12653, subd. (b)) and illegal conduct (Lab. Code, § 1102.5, subd. (b)). Without knowing what information the Report conveyed, any trier of fact would have no basis either to evaluate the credibility of appellant’s disclosures or to assess whether, in fact, the City had submitted false claims or violated any law. Moreover, regardless of the necessity of the information for appellant’s case, the City would be required to rely on the Report in mounting its defense. (See McDermott, Will & Emery v. Superior Court, supra, 83 Cal.App.4th at p. 385 [claim against an attorney may not proceed where attorney would be unable to defend absent use of attorney-client privileged information].) This is one of those “instances where the attorney-employee’s retaliatory discharge claim is incapable of complete resolution without breaching the attorney-client privilege, ” and thus “the suit may not proceed.” (General Dynamics, supra, 7 Cal.4th at p. 1170.)
The focus of appellant’s challenge to this conclusion is his assertion that his preparation and submission of the Report resulted from his compliance with mandatory professional duties, thereby enabling him to seek a remedy for his discharge notwithstanding the protections afforded by the attorney-client privilege. We reject appellant’s suggestion that General Dynamics, supra, 7 Cal.4th 1164, creates a distinction that would permit in-house counsel alleging compliance with a mandatory duty to rely on privileged information while denying that right to an attorney alleging compliance with a permissible ethical rule. Indeed, the mandatory provision on which appellant relies does not support his position. According to rule 3-600(B) of the California Rules of Professional Conduct: “If a member acting on behalf of an organization knows that an actual or apparent agent of the organization acts or intends or refuses to act in a manner that is or may be a violation of law reasonably imputable to the organization, or in a manner which is likely to result in substantial injury to the organization, the member shall not violate his or her duty of protecting all confidential information as provided in Business and Professions Code section 6068, subdivision (e).”
The Business and Professions Code carves out a limited exception-unsupported by the evidence here-to an attorney’s duty to protect confidential information when “the attorney reasonably believes the disclosure is necessary to prevent a criminal act that the attorney reasonably believes is likely to result in death of, or substantial bodily harm to, an individual.” (Bus. & Prof. Code, § 6068(e)(2).)
The protection of attorney-client privileged information is similarly paramount when an attorney brings a retaliatory termination claim. As the court in General Dynamics, supra, 7 Cal.4th at p. 1169, unambiguously stated: “[W]e conclude that there is no reason inherent in the nature of an attorney’s role as in-house counsel to a corporation that in itself precludes the maintenance of a retaliatory discharge claim, provided it can be established without breaching the attorney-client privilege or unduly endangering the values lying at the heart of the professional relationship.” (See also Vapnek, et al., Cal. Practice Guide: Professional Responsibility (The Rutter Group 2009) ¶ 7:27.1, p. 7-4 (rev. # 1, 2006) [“California’s ‘whistleblower’ statutes [citations] do not provide an exception to a lawyer’s duty of confidentiality. Thus, a lawyer acting as a whistleblower cannot reveal confidential information”], ¶ 7:177.2b, p. 7-58 (rev. # 1, 2007) [lawyer acting as a whistleblower cannot reveal privileged information].)
Confirming these principles, an Attorney General opinion earlier concluded “that the statutory provisions relating to the disclosure of false claims actions, communications with the Legislature, and the filing of complaints or claims or the institution of proceedings pertaining to the rights of employment by employees of state and local public entities do not supersede the statutes and rules governing the attorney-client privilege.” (84 Ops.Cal.Atty.Gen. 71, 2001 WL 577741, p. 7 (May 23, 2001).) The trial court took judicial notice of legislative history showing that, subsequent to the Attorney General opinion, the Legislature twice proposed a bill that would have created an exception to confidentiality requirement of Business and Professions Code section 6068, subdivision (e) to permit a government attorney to refer information of improper governmental activity to a higher authority under certain circumstances. Both Governors Davis and Schwarzenegger returned the bill without signature, concluding that it eroded and condoned violations of the attorney-client privilege-a protection “which is the cornerstone of our legal system.”
Were we to allow appellant to utilize the Report to establish his claims, we would effectively be creating an exception to the attorney-client privilege for retaliatory termination claims. That is not our role. “[T]he attorney-client privilege is a legislative creation, which courts have no power to limit by recognizing implied exceptions.” (Costco Wholesale Corp. v. Superior Court, supra, 47 Cal.4th at p. 739; Wells Fargo Bank v. Superior Court, supra, 22 Cal.4th at p. 206 [same].) Rather, we agree with the trial court’s conclusion that “California law has made it abundantly clear that the attorney-client privilege is sacrosanct and may not be breached.” Because appellant’s statutory retaliatory termination claims cannot be resolved without the use of attorney-client privileged information, the trial court properly determined that those claims were barred as a matter of law.
DISPOSITION
The judgment is affirmed. The City is entitled to its costs on appeal.
We concur: ASHMANN-GERST, J., CHAVEZ J.