Optional Capital v. Akin Gump Strauss, Hauer & Feld LLP
B275274
Cal. Ct. App.Dec 7, 2017Background
- Optional Capital (a Korean VC) alleged the Kim parties looted ~$35M, transferred funds into Alexandria and then to a Credit Suisse account; multiple parallel proceedings ensued (state suit, federal forfeiture, Swiss criminal action).
- DAS (claimant) settled the state court case in private mediation in Nov 2010; funds in the Credit Suisse account were later released to DAS after Swiss proceedings; Optional did not participate in the Swiss proceedings.
- Optional sued DAS and various lawyers (Akin Gump and Parker Shumaker attorneys) alleging conversion, fraudulent transfer, conspiracy, aiding-and-abetting, and Penal Code §496 violations tied to the transfer and concealment of funds.
- Defendants moved under Cal. Civ. Proc. Code §425.16 (anti-SLAPP), claiming their litigation-related communications and settlement activity were protected petitioning conduct and that the litigation privilege barred liability.
- The trial court granted the anti-SLAPP motions; Optional appealed. The Court of Appeal rejected Optional’s "law of the case" claim based on Optional I, found defendants’ acts arose from protected litigation activity, and held the litigation privilege barred Optional’s claims; the orders were affirmed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Optional I binds this appeal under law-of-the-case | Optional: Optional I established DAS’s conduct was not protected; that ruling binds subsequent proceedings | Defendants: Optional I involved different parties/issues and does not bind this appeal | Court: Law-of-the-case inapplicable because prior opinion decided different parties/issues; doctrine does not control here |
| Whether defendants’ conduct is protected under anti-SLAPP §425.16 (step 1) | Optional: Defendants are vicariously liable for DAS’s unprotected conduct; prior holding re: DAS shows conduct not protected | Defendants: Their communications and settlement work were litigation-related petitioning activity protected by §425.16(e) | Court: The gravamen of Optional’s claims arises from defendants’ litigation-related activities; defendants met prima facie burden of protected activity |
| Whether Flatley’s illegal-conduct exception removes defendants’ actions from anti-SLAPP protection | Optional: Alleged illegal conspiracy and concealment; Flatley exception applies to illegal petitioning | Defendants: No concession of illegality; evidence doesn’t conclusively show illegality | Court: Flatley exception is narrow; no conclusive evidence or concession of illegality here, so exception doesn’t apply at step 1 |
| Whether Optional established a probability of prevailing (step 2) given litigation privilege defense | Optional: Facts (delayed disclosure, settlement secrecy, in-court statements) permit inference of conspiracy/aiding and abetting | Defendants: Litigation privilege (Civ. Code §47(b)) immunizes their communicative litigation conduct and defeats liability | Court: Optional failed to make a prima facie admissible showing; the litigation privilege applies and bars the claims as a matter of law; anti-SLAPP dismissal affirmed |
Key Cases Cited
- Optional Capital, Inc. v. DAS Corp., 222 Cal.App.4th 1388 (Cal. Ct. App.) (prior appellate decision in related proceedings)
- Baral v. Schnitt, 1 Cal.5th 376 (Cal. 2016) (explains two-step anti-SLAPP framework and evidentiary approach)
- Rusheen v. Cohen, 37 Cal.4th 1048 (Cal. 2006) (attorney litigation communications are protected petitioning activity)
- Flatley v. Mauro, 39 Cal.4th 299 (Cal. 2006) (narrow illegal-conduct exception to anti-SLAPP protection where illegality is conceded or conclusively shown)
- Silberg v. Anderson, 50 Cal.3d 205 (Cal. 1990) (elements and purpose of the litigation privilege)
- Bergstein v. Stroock & Stroock & Lavan LLP, 236 Cal.App.4th 793 (Cal. Ct. App.) (litigation-related acts underpin anti-SLAPP analysis; privilege and protection for attorney communications)
- Finton Construction, Inc. v. Bidna & Keys, APLC, 238 Cal.App.4th 200 (Cal. Ct. App.) (litigation privilege protects attorneys’ handling of disputed materials during litigation)
- Contreras v. Dowling, 5 Cal.App.5th 394 (Cal. Ct. App.) (rejects inference of attorney-client conspiracy from mere attorney involvement; anti-SLAPP evidentiary standards)