• Fourth District Court of Appeal Declares "Patently Frivolous" Appeal of Denial of Anti-SLAPP Motion by Attorney Accused of Section 17200 Lawsuit Abuse
  • March 4, 2004 | Authors: Joanna S. McCallum; Andrew H. Struve
  • Law Firm: Manatt, Phelps & Phillips, LLP - Los Angeles Office
  • California practitioners who focus on unfair competition law (as well as numerous California businesses) are well aware of widely-publicized efforts last year by the Attorney General ("AG") to curtail concerted exploitation of the Unfair Competition Law, Business & Professions Code Section 17200 et seq. (the "UCL") by Beverly Hills' Trevor Law Group. Capitalizing on the UCL's wide-open standing for myriad "private attorneys general," the Trevor Law Group, and others, trolled public information databases for news of immaterial regulatory violations by small businesses, slapped the businesses with UCL lawsuits in the name of a sham "consumer" organization, and then promptly contacted the businesses offering -- usually successfully -- to settle for the nuisance value, often a few thousand dollars. The Trevor Law Group, in particular, was able to ramp up this scheme into an all-out coercive assault on small business and a simultaneous vilification of legitimate use of the UCL.

    In People ex rel. Lockyer v. Brar, 2004 WL 335165 (4th Dist. Feb. 24, 2004), the Fourth District Court of Appeal took aim at an offshoot of the abusive practices at issue in the Trevor matter, and made pointed comments highly critical of such abuses. Harpreet Brar is an attorney allegedly engaged in practices similar to those of Trevor. While Trevor made its "name" suing and settling with auto repair shops, Brar allegedly targeted manicure salons. The AG filed a complaint in July 2003 seeking to enjoin Brar from filing his baseless UCL suits as leverage for settlements.

    Brar responded creatively to the AG's suit by filing an anti-SLAPP motion. The anti-SLAPP suit statute provides a mechanism for a defendant to obtain a quick and early dismissal of a case brought against it based solely on the exercise of free speech and petition rights. Brar appealed the trial court's denial of his motion under a provision of the statute authorizing immediate appeals. Cal. Civ. Proc. Code ยง 425.16(j). But Brar apparently overlooked another subsection of the anti-SLAPP statute: subsection (d) expressly exempts from the statute actions brought by the AG. Thus, Brar's motion, and his appeal, were frivolous from the outset.

    In a short but scathing opinion, the Fourth District dismissed the appeal as "about as patently frivolous an appeal taken for purposes of delay as is imaginable." Under current judicial interpretation, filing an appeal of the denial of an anti-SLAPP motion stays the trial court proceedings. (A case holding to the contrary has a petition for Supreme Court review pending.) The Fourth District noted that in this action, where the AG's entire purpose was to prevent Brar's continuing abuse of the legal system, Brar had much to gain by the delay attendant to his appeal, and thus "Brar's appeal practically has the words 'brought for reasons of delay' virtually tattooed on its forehead." The court flatly rejected Brar's "ad hominem" argument that because the AG was pursuing him for alleged political motive -- to curry favor with the plaintiffs' bar -- the anti-SLAPP statutory exception should not apply to preclude his motion. As the court explained, public prosecutors may often act with political motive, and the Legislature was free to write a "political motive" exception into the public prosecutor exception, had it wished to do so.

    The court also went further than mere dismissal of the appeal as frivolous, exercising its power to shorten the period for finality of the decision and ordering the opinion made final five days after filing. The court also virtually invited the AG to seek sanctions in the trial court.

    Brar thus may reflect a degree of judicial antipathy toward the abusive UCL practices exemplified in the Trevor matter. At a minimum, Brar 's rejection of the attorney's exploitation of yet another statute solely to create delay provides additional ammunition for ongoing efforts to reform the UCL and curtail its abuse.