MATHEW ABRAHAM, Plaintiff and Appellant, v. LANCASTER COMMUNITY HOSPITAL et al., Defendants and Respondents.
No. B038456
Second Dist., Div. Seven.
Jan. 30, 1990
217 Cal. App. 3d 796
Sheppard, Mullin, Richter & Hampton, Richard P. Sybert, Kent R. Raygor, Perry J. Viscounty and Polly Towill Dennis for Plaintiff and Appellant.
Coppo & Cosgrove, Horvitz & Levy, David M. Axelrad, Rosalyn S. Zakheim, Vogt, Sanchez & Meadville and Carole S. Khan for Defendants and Respondents.
OPINION
WOODS (Fred), J.---
I. INTRODUCTION
Appellant, Mathew Abraham, hereafter Abraham, appeals from an order of dismissal following the sustaining of respondents’ demurrer without leave to amend. Abraham‘s action in the superior court emanates from allegations made about him by the respondents in a lawsuit in the United States District Court. We conclude that the allegations complained of are protect
II. PROCEDURAL AND FACTUAL SYNOPSIS
A. The Underlying Federal Action
1. Original Complaint in Federal Court.
On February 3, 1987, Lancaster Community Hospital, hereafter LCH, filed a complaint in the United States District Court for the Central District of California. Damages, as well as declaratory and injunctive relief were sought based upon causes of action on the following legal theories: antitrust violations, interference with contractual relationships, and interference with prospective economic advantage.1 The named defendants in the initial complaint of the underlying federal action were Antelope Valley Hospital Medical Center, hereafter Antelope; Maxicare Health Plan; Blue Cross of California; and Sierra Primary Care Associates, hereafter Sierra.
2. Proposed First Amended Complaint in Federal Court.
LCH subsequently moved for leave to amend its complaint in the United States District Court in November of 1987. LCH‘s proposed first amended complaint in the federal action sought damages and injunctive relief arising from alleged violations of California and United States antitrust laws, the Racketeer Influenced and Corrupt Organizations Act (RICO), and the common law. Named defendants included Abraham; the Antelope Valley Hospital District, hereafter AVHD; Antelope Valley Medical Group, Inc., hereafter Medical Group; John H. Lynn; Antelope Valley Health Ventures; Antelope Valley Dialysis Center; and Blue Cross of California. Maxicare Health Plan (hereafter Maxicare) and Sierra Primary Care Associates, another respondent in this appeal, were mentioned in the body of the proposed first amended complaint as coconspirators.
It is alleged that Abraham‘s responsibilities as assistant administrator of Antelope include oversight of the hospital‘s contracting with alternate delivery systems and third party payors. “Abraham is also responsible for overseeing [Antelope‘s] relationships with defendants [Medical Group] and Antelope Valley Dialysis Center, and for overseeing the activities of defendant Antelope Valley Health Ventures.”
Antelope is alleged to be the only hospital in a certain area providing perinatal services, but is one of four hospitals, including LCH, providing inpatient medical/surgical services.
It is alleged that “Abraham and [Antelope] have exploited [Antelope‘s] market power and monopoly power over perinatal services to coerce private payors to purchase inpatient medical/surgical services from [Antelope] and to inflict competitive injury upon [LCH].”
According to LCH‘s proposed first amended complaint, during the year 1985, Abraham, Antelope, and AVHD caused the Medical Group to be organized and to affiliate with Antelope and no other hospital.2 Various defendants, including Abraham, agreed Antelope should not contract with Maxicare unless Maxicare entered into a business relationship with the Medical Group. Through these and other devices, defendants forced Maxicare into an agreement whereby at least 51 percent of Maxicare‘s medical/surgical patients would be admitted to Antelope or Maxicare‘s contract with Antelope would “automatically terminate.” Maxicare in turn notified Sierra that Sierra was to refer Maxicare enrollees to Antelope whenever possible; Sierra did so. The overall effect was to dissuade medical/surgical patients from patronizing LCH.
Similarly, Abraham, AVHD and Antelope were alleged to have exerted pressure on Blue Cross to divert its enrollees from LCH to Antelope; as a result, Blue Cross terminated its agreement with LCH and entered into an exclusive contract with Antelope. The defendants are further alleged to have insisted other private payors wishing to use Antelope‘s perinatal
The proposed LCH complaint alleged Antelope has thus been able to pressure others to use its medical/surgical services over those of LCH even though Antelope‘s charges for perinatal service “are now and have been substantially above levels charged for such services in markets where competition exists.” When questioned about recent increased charges, Mr. Abraham allegedly responded “that the rate is ‘not negotiable’ and that ‘if you don‘t like the rates, take your babies by helicopter somewhere else.‘” Other alleged statements by Abraham further demonstrate Antelope‘s “predatory, anticompetitive and monopolistic intent“: “‘You have to deal with me to practice [medicine] here‘“; “‘I will bring Maxicare to their knees just like I brought Kaiser [Kaiser Permanente---another health maintenance organization] to their knees‘“; “‘I control health care in the [Antelope] Valley‘“; and “‘If you don‘t want to use Antelope Valley‘s [perinatal services], drop a few babies along the freeway---like Kaiser---and see what that does to your reputation.‘”3
The proposed LCH complaint alleged further that Antelope has attempted to acquire LCH and Palmdale Community Hospital, “the only hospitals in the relevant geographic market which pose substantial competition to [Antelope] in the market for inpatient medical/surgical services for private pay patients.” The complaint alleged AVHD and Abraham used a pattern of fraudulent schemes, including misappropriation of public funds, violations of federal and state antikickback statutes, and violations of state law prohibiting the making of false entries in the records of a corporation, as a part of establishing relationships with organized medical groups.
The proposed LCH complaint also alleged the above acts and practices have injured competition and that LCH has been placed at a substantial competitive disadvantage. The prayer requested (1) defendants be adjudged to have violated the relevant statutes and to have committed the alleged torts; (2) treble damages be assessed for violations of the Sherman Act, the Cartwright Act, and RICO; (3) AVHD be enjoined from owning or operating any health care facilities or financing organization except Antelope for a period of 10 years; (4) the Medical Group be required to repay to AVHD all public monies and the value of all goods and services unlawfully granted or transferred by AVHD and Antelope; (5) the Medical Group be required to be dissolved; and (6) “AVHD terminate the employment of [Abraham] and all other AVHD employees who participated in the unlawful conduct . . . .”
Attached to Abraham‘s complaint in this state court action is a letter dated February 22, 1988, from Abraham‘s counsel, Richard P. Sybert of Sheppard, Mullin, Richter & Hampton, to trial counsel for LCH in the federal lawsuit, Mr. Robert Fabrikant of McKenna, Conner & Cuneo. Mr. Sybert wrote “to state in the strongest possible terms that I see no grounds for naming [Abraham] as a defendant, and that I believe to do so would constitute a clear abuse of the legal process.” Mr. Sybert found no evidence his client was “acting other than in his capacity as an employee and agent of Antelope Valley Hospital.”
In addition, in disparaging LCH‘s complaint, Mr. Sybert asserted LCH‘s principal problem was that it “may be facing effective competition.” Sybert also asserted that LCH is “improperly using litigation to further anti-competitive business ends.” Sybert wrote LCH that “we are investigating the possibility of bringing claims for, inter alia, abuse of process and malicious prosecution. Although I do not mean to exclude this possibility even if the complaint is not amended, this investigation obviously will intensify if, in fact, amended claims are brought against Mr. Abraham personally.”
The concluding paragraph urged LCH to reconsider, whether or not the federal court granted leave to file the proposed first amended complaint, to dismiss Abraham voluntarily as a defendant.
Attached to Abraham‘s complaint as exhibit D in this state court action is a letter dated February 22, 1988, from Mr. Fabrikant to Mr. Sybert. There is no indication Mr. Fabrikant had received Mr. Sybert‘s letter of the same date or that Mr. Fabrikant was responding to it.
Mr. Fabrikant thanked Mr. Sybert for a letter of January 26 and agreed the litigation is primarily a fight between corporate entities. Nevertheless, regarding Abraham, Mr. Fabrikant stated: “His deposition testimony reveals significant and ongoing involvement in the conduct underlying the First Amended Complaint. If Mr. Abraham is prepared to terminate his employment within the Antelope Valley, we would seriously consider dropping him from this litigation.”
C. Order Permitting Amendment to Complaint in Federal Court
In an order filed March 4, 1988, the federal district court granted LCH‘s motion for leave to add several new parties as defendants (including Abraham) and adding additional causes of action. The order states in part:
“Plaintiff may amend its complaint to add the new defendants . . . . Plaintiff has fifteen days from the date of this order to file its amended pleading.”
The revised amended complaint, attached to Abraham‘s complaint in this state court action as exhibit E, contains virtually the same allegations as LCH‘s proposed first amended complaint. However, Abraham is not named as a defendant; and the prayer no longer asks for AVHD to terminate his employment. Nevertheless, Abraham was named as a coconspirator in the body of the complaint and virtually all the allegations regarding his conduct remained.
After the revised amended complaint was filed, Abraham asked to intervene in the federal lawsuit for purposes of asserting the causes of action alleged in the complaint now before this court. The district court denied Abraham‘s motion to intervene.
D. Abraham‘s Superior Court Complaint
On May 20, 1988, Abraham filed the instant lawsuit, attempting to allege causes of action for defamation, abuse of process, intentional interference with contractual relations, intentional interference with prospective economic advantage, conspiracy to intentionally interfere with contractual relations and prospective economic advantage, and intentional infliction of emotional distress. He named as defendants LCH; Paracelsus Healthcare Corporation, alleged to be LCH‘s parent corporation; and Sierra. All of the allegations in Abraham‘s complaint originate with LCH‘s involvement in the federal lawsuit described above.
Abraham alleges that LCH did not name him as a defendant in its original federal complaint, but did name him as a defendant in its proposed first amended complaint, in which he was accused of “a wide variety of unlawful and criminal acts . . . including kickbacks, misappropriation of public funds, and corruption.” The relief sought by LCH included termination of Abraham‘s employment.
Abraham‘s complaint next alleges that before the federal court ruled on the motion of LCH for leave to file its proposed amended federal complaint, LCH allegedly “caused its allegations to be published in the local press.” A copy of the articles, which appeared on Christmas Day in the Antelope Valley Press, were attached to Abraham‘s complaint. The articles in the Antelope Valley Press reported the pending motion for leave to file the amended complaint and the allegations made in the proposed amended complaint. Abraham further alleges on information and belief that defendants or their agents also “caused such allegations and charges against
The Abraham complaint also contains allegations that, based on the individual allegations against Abraham in the press and in the proposed amended complaint, Antelope secured independent counsel for him. Independent counsel allegedly reviewed the case and decided Abraham was at all times acting within the scope of his employment at the express direction of his employer, evidence allegedly known by and available to LCH before LCH made “its new allegations against Abraham in its proposed Amended Federal Complaint and caused those allegations to be published in the Antelope Valley Press.”
Abraham‘s independent counsel then contacted LCH‘s counsel, explaining the factual deficiencies of the complaint. Abraham‘s complaint contains allegations that counsel for LCH offered to drop Abraham from the lawsuit if Abraham was prepared to terminate his employment within the Antelope Valley.
The complaint then states that, thereafter, on March 2, 1988, a pending motion by Antelope for summary judgment in the federal action was granted. On March 4, the federal court granted LCH‘s motion for leave to file its amended federal complaint. On March 18, LCH filed an amended complaint that dropped Abraham as a named defendant, but retained the charging allegations from the proposed amended federal complaint.
According to Abraham‘s complaint, LCH launched a personal attack on him “for the purpose of prompting the termination of his employment at [Antelope]. LCH seeks to have [him] fired because he has done his job too well and made [Antelope] a more effective competitor with LCH.”
The six causes of action are summarized as follows:
First Cause of Action for Defamation.
Abraham alleges LCH‘s proposed amended federal complaint, the December 25 article in the Antelope Valley Press “concerning [LCH‘s] proposed Amended Federal Complaint,” and the revised federal complaint accuse him of a wide variety of unlawful and criminal acts and are false and libelous on their face. Because these statements allegedly “had no reasonable or logical relation to the federal action and were not made to achieve the objects of the litigation or to promote the interests of justice,” they purportedly were not privileged.
Second Cause of Action for Abuse of Process.4
Abraham alleges LCH willfully misused the process of the federal court by filing its motion for leave to amend and, after leave to file was granted, not filing the proposed amended complaint, but instead filing its revised federal complaint. LCH‘s alleged “ulterior purpose and motivation in so willfully misusing the process of the Federal Court . . . was to force [Antelope] to terminate Abraham‘s employment . . . , to force Abraham to terminate his employment in the Antelope Valley, and to otherwise gain some collateral advantage over Abraham and his employer, [Antelope].”
Third Cause of Action for Intentional Interference With Contractual Relation.
Abraham alleges there was a contract between him and his employer; defendants knew of the employment contract; and both separately and in conspiracy intentionally interfered with the employment relationship, all with the intent to harm Abraham financially and to induce Antelope to breach its employment contract with him.
Fourth Cause of Action for Intentional Interference With Prospective Business Advantage.
Abraham alleges defendants knew of the economic relationship between him and Antelope and intentionally interfered with it, all “with the intent to harm Abraham financially and to induce [Antelope] to sever its economic relationship” with him.
Fifth Cause of Action for Conspiracy to Intentionaly Interfere With Contractual Relations and Prospective Economic Advantage.
Abraham alleges that defendants conspired to interfere with Abraham‘s contractual relations and prospective economic advantage.
Abraham alleges all of the above acts were “outrageous and directed solely at attempting to terminate Abraham‘s employment with [Antelope] and in the Antelope Valley.” The conduct allegedly was intentional and malicious, done with the knowledge that Abraham‘s emotional and physical distress would thereby increase, and with a wanton and reckless disregard of the consequences to him. LCH‘s conduct allegedly subjected Abraham to humiliation, mortification, and severe emotional distress; as a result, he has allegedly suffered humiliation, mental anguish, and emotional and physical distress.
E. Respondents’ Demurrer to Abraham‘s Complaint in the Superior Court
Respondents LCH and Paracelsus Healthcare Corporation demurred to the complaint on grounds the alleged causes of action were barred by the absolute privilege of
Abraham argued that the privilege does not apply because it protects publications made in connection with judicial proceedings only when the litigation is contemplated in good faith and the publications are made to achieve the objects of the litigation, are in furtherance of the litigation, and promote the interests of justice. In addition, Abraham asserted he sufficiently pled his cause of action for abuse of process.
The demurrers were heard by the Honorable Margaret M. Grignon, Judge presiding on September 30, 1988. The court sustained the demurrers without leave to amend “on the grounds that the conduct complained of in the Complaint is protected by the privilege of
A. The Absolute Privilege of Civil Code Section 47, Subdivision 2 Bars All of Abraham‘s Cause of Action, Except for Malicious Prosecution.
1. The Standard of Review.
The Court of Appeal in Carden v. Getzoff (1987) 190 Cal.App.3d 907, 912 [235 Cal.Rptr. 698], set forth the standard of review for the appellate court‘s review of a dismissal following the sustaining of a demurrer: “‘We treat the demurrer as admitting all material facts properly pleaded, but not contentions, deductions or conclusions of fact or law. [Citation.] We also consider matters which may be judicially noticed.’ [Citations.] Further, we give the complaint a reasonable interpretation, reading it as a whole and its parts in their context. [Citation.] When a demurrer is sustained, we determine whether the complaint states facts sufficient to constitute a cause of action. [Citation.] And when it is sustained without leave to amend, we decide whether there is a reasonable possibility that the defect can be cured by amendment: if it can be, the trial court has abused its discretion and we reverse; if not, there has been no abuse of discretion and we affirm. [Citations.] The burden of proving such reasonable possibility is squarely on the plaintiff. [Citation.]’ [Citation.]”
As we now explain, the plain meaning of the
2. The Plain Meaning of Section 47, Subdivision 2 Demonstrates It Is an Absolute Privilege, Unaffected by Malice.
“When statutory language is clear and unambiguous there is no need for construction, and courts should not indulge in it.” (West Covina Hospital v. Superior Court (1986) 41 Cal.3d 846, 850 [226 Cal.Rptr. 132, 718 P.2d 119, 60 A.L.R.4th 1257].)
Even the most casual reading demonstrates that, except in a specific dissolution context discussed below and not present in the case at bar,
Furthermore, as we now explain, the legislative history of
3. The History of Section 47, Subdivision 2 Demonstrates the Legislature Intended It to Be an Absolute Privilege, Not Affected by Malice or the Intent to Do Harm.
The primary task in construing a statute “is to determine the Legislature‘s intent. [Citation.] ‘The court turns first to the words themselves for
“[I]t is instructive to compare
When enacted in 1872,
In 1911, the California Supreme Court in Gosewisch held that malice did not defeat the privilege. (Thornton v. Rhoden, supra, 245 Cal.App.2d at p. 88.)
Then, in 1927, “a proviso was added which ‘changed the absolute privilege to a conditional privilege in a single subclass of judicial proceedings---divorce proceedings’ . . .” (McClatchy Newspapers, Inc. v. Superior Court, supra, 189 Cal.App.3d at p. 970.) The 1927 amendment to
“It is a well recognized principle of statutory construction that when the Legislature has carefully employed a term in one place and has
4. The California Supreme Court Has Decided the Privilege Under Section 47, Subdivision 2 Is Absolute and Not Affected by a Defendant‘s Motives. The Only Limitation Is a Reasonable Connection to the Judicial Proceeding.
Over 70 years ago, in Gosewisch v. Doran, supra, 161 Cal. 511, the Supreme Court decided the “only limitation,” if any, on the privilege “is that the defamatory matter must be pertinent and material to the cause or subject of inquiry before the court. If it be pertinent, the defendant‘s malice or bad faith does not affect the privileged character of the publication.” (Italics added.) (Id., at p. 514.) “Subject to the possible limitation of relevancy and materiality, the privilege attaching to statements made in the course of judicial proceedings is absolute.” (Id., at p. 515.)
In 1956, the court in Albertson v. Raboff (1956) 46 Cal.2d 375, 379 [295 P.2d 405] applied the
The Albertson court applied a liberal standard for determining whether a statement is sufficiently connected to the judicial proceedings: “It is our opinion that the privilege applies to any publication, . . . that is required or permitted . . . by law in the course of a judicial proceeding to achieve the objects of the litigation, even though the publication is made
In 1982, the court in Slaughter v. Friedman (1982) 32 Cal.3d 149, 155 [185 Cal.Rptr. 244, 649 P.2d 886] reiterated the absolute nature of the
Broad application of the absolute privilege in a judicial proceeding is explained by the critical role of the privilege in promoting free access to the courts and in shielding “counsel, his [or her] client and witnesses from having their motives questioned and being subjected to litigation if some connection between the utterance and the judicial inquiry can be established.” (Thornton v. Rhoden, supra, 245 Cal.App.2d at p. 90.) As the California Supreme Court has stated, “the obvious purpose of section 47 [is] to afford litigants the utmost freedom of access to the courts to secure and defend their rights without fear of being harassed by actions for defamation.” (Albertson v. Raboff, supra, 46 Cal.2d at p. 380; accord Ribas v. Clark, supra, 38 Cal.3d 355, 364-365 [“Underlying the privilege is the vital public policy of affording free access to the courts and facilitating the crucial functions of the finder of fact.“]; Berman v. RCA Auto Corp. (1986) 177 Cal.App.3d 321, 324-325 [222 Cal.Rptr. 877]; Loomis v. Superior Court (1987) 195 Cal.App.3d 1026, 1030 [241 Cal.Rptr. 236] [“The privilege would have little value if attorneys could not make colorable, but unsuccessful, arguments without fear of engendering litigation over publication of materials to support their arguments.“].)11
As with all privileges, some who are undeserving may benefit from
In Kachig (cited with approval in Ribas), the court “with considerable regret and dissatisfaction” nevertheless refused to give relief to a party against whom previous final judgments had been entered allegedly based on a false document and perjured testimony. (Kachig v. Boothe, supra, 22 Cal.App.3d at p. 642.) As Justice Kaufman, writing for the court, stated: “[W]e recognize that the wrong in this case is a most grievous one, and we should be glad to redress it if a rule could be devised that would remedy the evil without producing mischiefs far worse. Reluctance on the part of witnesses to testify for fear of subsequent harassment by unfounded claims of perjury or endless litigation in which nothing was ever finally determined would be worse than occasional miscarriages of justice.” (Ibid.)
It is tempting to assist those who may be wronged by invocation of the privilege. However, “it would be difficult if not impossible to formulate a
Along with the plain meaning of the statute and its legislative history, decisions of the Supreme Court thus make clear that, except for an action for malicious prosecution (Albertson v. Raboff, supra, 46 Cal.2d at p. 382), the privilege under
5. Most Court of Appeal Decisions Also Recognize the Absolute Nature of the Privilege Under Section 47, Subdivision 2 .
In addition to dispositive Supreme Court authority, there is a long line of decisions by the Courts of Appeal, both recent and longstanding, supporting an expansive interpretation of the
Other cases from the Second Appellate District upholding the privilege include:
a) Division One: Woodcourt II Limited v. McDonald Co. (1981) 119 Cal.App.3d 245, 251 [173 Cal.Rptr. 836] (per Lillie, J.) [The Supreme Court in Albertson imposed no limitations or qualifications on the absolute privilege it accorded notice of lis pendens under
b) Division Two: Chen v. Fleming (1983) 147 Cal.App.3d 36, 39-41 [194 Cal.Rptr. 913]; Rosenthal v. Irell & Manella (1982) 135 Cal.App.3d 121, 125-126 [185 Cal.Rptr. 92]; Portman v. George McDonald Law Corp. (1979) 99 Cal.App.3d 988, 990-991 [160 Cal.Rptr. 505] [adopting Albertson rationale that publication “need only have some connection or relation to the proceedings” for the privilege to attach].
c) Division Three: Carden v. Getzoff, supra, 190 Cal.App.3d 907 [upholds sustaining of demurrer although complaint alleged expert accounting witness for plaintiff‘s former wife had manufactured false evidence and testified falsely]; Lerette v. Dean Witter Organization, Inc. (1976) 60 Cal.App.3d 573 [131 Cal.Rptr. 592]; Thornton v. Rhoden, supra, 245 Cal.App.2d at page 93 [“If the matter is privileged, it is so regardless of the good faith vel non of the defamer.” (Italics added.)].
d) Division Four: Jordan v. Lemaire (1963) 222 Cal.App.2d 622, 625 [35 Cal.Rptr. 337] [To be protected by
e) Division Five: Berman v. RCA Auto Corp., supra, 177 Cal.App.3d at pages 324-325; Izzi v. Rellas (1980) 104 Cal.App.3d 254, 262-263 [163 Cal.Rptr. 689]; Imig v. Ferrar, supra, 70 Cal.App.3d at pages 55-56; Scott v. McDonnell Douglas Corp. (1974) 37 Cal.App.3d 277, 285 [112 Cal.Rptr. 609] [Absolute privilege of
Cases from other districts demonstrating an interpretation of
a) First Appellate District: Loomis v. Superior Court, supra, 195 Cal.App.3d 1026, 1029 [Malice or intent to do harm does not defeat
b) Third Appellate District: Williams v. Coombs (1986) 179 Cal.App.3d 626, 645 [224 Cal.Rptr. 865] disapproved on another point in Sheldon Appel Co. v. Albert & Oliker (1989) 47 Cal.3d 863, 883, footnote 9 [254 Cal.Rptr. 336, 765 P.2d 498] [In an action for intentional infliction of emotional
c) Fourth Appellate District: Larmour v. Campanale (1979) 96 Cal.App.3d 566, 568-569 [158 Cal Rptr. 143]; Umansky v. Urquhart (1978) 84 Cal.App.3d 368, 371-373 [148 Cal.Rptr. 547] [If complaint allegations are consistent with the objects of the litigation, inquiring into the motive of counsel would have an unnecessary chilling effect upon lawyers.]; Kachig v. Boothe, supra, 22 Cal.App.3d at pages 640-641 [no cause of action for intentional infliction of emotional distress where plaintiff lost at a previous trial based on a manufactured letter and perjured testimony]; Whelan v. Wolford (1958) 164 Cal.App.2d 689, 694 [331 P.2d 86] [Absolute privilege applies to any publication required or permitted by law in the course of an official proceeding as long as there is a reasonable relation to the action.].
d) Fifth Appellate District: McClatchy Newspapers, Inc. v. Superior Court, supra, 189 Cal.App.3d 961, 971-977 [rejecting Bradley‘s “promote the interest of justice” test, and holding that even though allegations, testimony and evidence were produced pursuant to a conspiracy to invoke immunity under
e) Sixth Appellate District: Financial Corp. of America v. Wilburn, supra, 189 Cal.App.3d at page 777 [“Plaintiffs’ premise is that the subjective intent, purpose, or knowledge of a writer can destroy the privileged status of otherwise privileged statements. The law is otherwise.“].
As we now explain, the few cases that require consideration of motive or purpose in determining whether to apply the privilege under
6. Bradley v. Hartford Acc. & Indem. Co. and Its Progeny Ignore the Plain Meaning and History of Section 47, Subdivision 2 and Impose a Requirement That Defeats the Legislature‘s Intent. We Therefore Decline to Follow Bradley and the Decisions of the Court of Appeal Which Rely on It.
The principal case upon which Abraham relies is Bradley v. Hartford Acc. & Indem. Co., supra, 30 Cal.App.3d 818. The facts in Bradley, however, are distinguishable from the instant case. The parties who made the allegedly defamatory statements in Bradley were not parties or attorneys in the prior action, and the statements were “uttered orally outside of court and not in the course of any legal proceedings to third persons who had no interest” in the action. (Id., at p. 822; compare Carden v. Getzoff, supra, 190 Cal.App.3d at pp. 913-914.) Furthermore, “extrajudicial documents, not appropriately a part of the judicial proceedings” were allegedly filed for the sole purpose of having them republished by the news media. (Italics added.) (Bradley, supra, 30 Cal.App.3d at p. 822.)
Unlike the case at bar, where all parties were interested in and involved in the federal litigation and the statements were directly related to the federal claims, the reasonable relation to a judicial proceeding does appear attenuated in Bradley. But the Bradley court did not stop with a holding that reasonable relationship to a judicial proceeding was nonexistent; rather, in dicta, the Bradley court laid “special emphasis . . . on the requirement that [the publication] be made in furtherance of the litigation and to promote the interest of justice” and concluded “[o]nly if this requirement has been satisfied, is it appropriate for the courts to define liberally the scope of the term ‘judicial proceeding’ and the persons who should be regarded as litigants or other participants.” (Original italics.) (30 Cal.App.3d at p. 826.) The Bradley court (First Dist., Div. Two) later reaffirmed this dicta in Barbary Coast Furniture Co v. Sjolie (1985) 167 Cal.App.3d 319, 334-335 [213 Cal.Rptr. 168].16
The Bradley requirement that the publication be made “in furtherance of the litigation” may conform to the plain meaning of the statute, its legislative history, and controlling case law so long as it is merely another way of stating the publication need have only a reasonable relation or connection to the proceeding in order to qualify for the privilege. Thus, for example, Lerette v. Dean Witter Organization, Inc., supra, 60 Cal.App.3d at page 576, footnote 5, interprets Bradley as imposing “requirements [that] basically demand that the offending communication be relevant to the judicial proceeding.” (See also McClatchy Newspapers, Inc. v. Superior Court, supra, 189 Cal.App.3d at p. 973, fn. 3 [adopting similar construction, but specifically rejecting Bradley‘s “promotion of the interest of justice” qualification to the absolute privilege]; O‘Neill v. Cunningham, supra, 118 Cal.App.3d at pp. 474-475; Carney v. Rotkin, Schmerin & McIntyre, supra, 206 Cal.App.3d at pp. 1521-1522.) If this interpretation of Bradley is adopted, the requirement is met in the case at bar because the statements about Abraham were directly connected to the federal lawsuit and are at the core of that litigation.
However, even if one can harmonize part of Bradley with controlling Supreme Court authority, the additional Bradley requirement, that the publication must “promote the interest of justice,” is at odds with the very nature of the privilege. The good faith of the publisher or concern with the interest of justice is simply not at issue. For example, defamation by definition does not “promote the interest of justice.” Nevertheless, the Legislature has seen fit in enacting
In our view Bradley and Barbary Coast incorrectly assess the
Fuhrman v. California Satellite Systems (1986) 179 Cal.App.3d 408 [231 Cal.Rptr. 113], does not hold that a publication made in actual litigation must be made in good faith. Rather, the Fuhrman court distinguished between a good faith intention to bring a suit, which the court considered a requirement before the privilege will protect prelitigation statements, and publications made during the litigation without a good faith belief in their truth, which “are protected as part of the price paid for affording litigants the utmost freedom of access to the courts.” (Id., at p. 422, fn. 5; accord Herzog v. “A” Company, Inc. (1982) 138 Cal.App.3d 656, 662 [188 Cal.Rptr. 155]; see also Larmour v. Campanale, supra, 96 Cal.App.3d at p. 569, fn. 2; Rest.2d Torts, § 586, com. e.) Of course, in the case at bar, there is no question the statements were made in the context of actual litigation; the federal lawsuit had already been filed when the statements about which Abraham complains were made.
In Earp v. Nobmann (1981) 122 Cal.App.3d 270 [175 Cal.Rptr. 767], the trial court found attempts to circumvent the statutory lis pendens law (by personally notifying nonparties of a claim of interest in land after the lis pendens had been expunged) constituted a deliberate circumvention of the judicial process by extrajudicial communications that were not “in furtherance of the litigation and to promote the interest of justice” and therefore were outside the scope of
The court in Walsh v. Bronson (1988) 200 Cal.App.3d 259 [245 Cal.Rptr. 888], did not decide Bradley was correct; it decided only that an attorney could use Bradley as a defense to a malicious prosecution action. (Id., at p. 270.) The Walsh court merely used Bradley to demonstrate an attorney familiar with Bradley could “reasonably believe” a publication might not be privileged if it was of dubious connection to the judicial proceeding and was uttered with the express objective of attempting to cloak the subsequent publication with the
Applying the above principles to the facts of this case, we now proceed to a discussion of each cause of action in Abraham‘s state court action and find that the publications about Abraham are absolutely protected by the privilege of
8. Abraham‘s State Court Complaint Is Barred by Civil Code Section 47, Subdivision 2.
Under the test for application of the
First, it cannot be disputed that “[t]he filing [of] a lawsuit is a publication in the course of a judicial proceeding.” (Williams v. Coombs, supra, 179 Cal.App.3d at p. 645.)
Second, Abraham‘s complaint is based on allegations clearly made in connection with pending federal litigation. The original federal complaint, alleging facts and legal theories similar to those in the later amended pleadings, demonstrates LCH was proceeding with a real lawsuit. The proposed amended complaint and revised amended complaint are far more than mere “anticipation of litigation,” the only situation where one‘s good faith intent to bring a lawsuit might be an issue. (Fuhrman v. California Satellite Sys-tems, supra, 179 Cal.App.3d at p. 422, fn. 5; Carden v. Getzoff, supra, 190 Cal.App.3d at p. 915; see Rest.2d Torts, § 586, com. e; Larmour v. Campanale, supra, 96 Cal.App.3d at p. 569, fn. 2.)
Third, the allegations in the federal complaints concerning appellant are directly related to the issues raised by the pleadings. The federal complaints assert monopoly, antitrust and similar causes of action based on allegedly using Antelope‘s perinatal services as a carrot and a stick to force others to use the hospital‘s medical and surgical facilities as well. The allegations relating to Abraham allege his involvement in these schemes and are inextricably linked to the gravamen of the complaint.
Fourth, the communications between counsel are directly related to the litigation and are protected by the privilege. Attorneys must be free to communicate with opposing counsel about the merits of a case and proposals for settlement without fear of subsequent lawsuits by disgruntled former opposing parties. (Izzi v. Rellas, supra, 104 Cal.App.3d at p. 264; Lerette v. Dean Witter Organization, Inc., supra, 60 Cal.App.3d at p. 577.)
Fifth, the publications in the Antelope Valley Press were confined to a report of the pleadings in the federal complaint. Since the articles were accurate reports of the contents of the federal pleadings (Abraham does not contend otherwise), they were absolutely privileged as a “fair and true report in a public journal, of (1) a judicial . . . proceeding.” (
Finally, there is the alleged communication of the allegations within the Antelope Valley and specifically within the medical community. These, too, are privileged communications. First, the local medical community possessed “a substantial interest in the outcome of the pending litigation” and as such were “participants” therein. (Costa v. Superior Court, supra, 157 Cal.App.3d at p. 678.) Second, to exclude these alleged communications about a judicial proceeding from the scope of
9. Section 47, Subdivision 2 Applies to All But Malicious Prosecution Actions; the Privilege Therefore Bars Abraham‘s Cause of Action for Abuse of Process.
Abraham contends that even if the
Although
The rationale behind allowing a malicious prosecution action while permitting
Apart from his attempt to analogize abuse of process to malicious prosecution, despite their obvious differences, Abraham also contends
10. Section 47, Subdivision 2 Aside, the Demurrer to Abraham‘s Cause of Action for Abuse of Process Was Correctly Sustained Since Abraham Failed to State Facts Sufficient to Constitute an Abuse of Process.
“It is well settled that ‘[i]f the decision of the lower court is right, the judgment or order will be affirmed regardless of the correctness of the grounds upon which the court reached its conclusion.‘” (Original italics.) (Malmstrom v. Kaiser Aluminum & Chemical Corp. (1986) 187 Cal.App.3d 299, 308 [231 Cal.Rptr. 820].) Here, even if the absolute privilege under
In particular, as this court has held, “the mere filing of a complaint cannot constitute an abuse of process.” (Drasin v. Jacoby & Meyers, supra, 150 Cal.App.3d at p. 485.) In Drasin, Justice Schauer concluded the trial court acted properly in refusing to allow plaintiff to amend his complaint to state a cause of action for abuse of process where defendant allegedly had the motive of “gaining publicity or obtaining a ‘nuisance’ settlement” but did no more than file a complaint for damages. (Ibid.; see also Seidner v. 1551 Greenfield Owners Assn. (1980) 108 Cal.App.3d 895, 904 [166 Cal.Rptr. 803] [“[T]he parties who have abused or misused the process, have gone beyond the mere filing of a lawsuit.“]; Tellefsen v. Key System Transit Lines (1961) 198 Cal.App.2d 611, 615 [17 Cal.Rptr. 919] [the taking of an appeal, even a frivolous one, is not enough to constitute an abuse of process; “defendant ‘has done nothing more than carry out the process to its authorized conclusion, even though with bad intentions . . . ‘“]; accord Oren Royal Oaks Venture, supra, 42 Cal.3d at p. 1169 [“[T]he mere filing or maintenance of a lawsuit—even for an improper purpose—is not a proper basis for an abuse of process action.“]).21
Similarly, in Templeton Feed & Grain v. Ralston Purina Co. (1968) 69 Cal.2d 461, 466-467 [72 Cal.Rptr. 344, 446 P.2d 152], no mere publication was involved; the court found that wrongfully seizing 35,000 turkeys under a chattel mortgage at Thanksgiving amounts to an abuse of process. In Barquis v. Merchants Collection Assn. (1972) 7 Cal.3d 94 [101 Cal.Rptr. 745, 496 P.2d 817], a debt collection agency‘s alleged filing of complaints in the wrong venue for the improper ulterior purpose of impairing adversaries’ ability to defend such suits was found to be abuse of process; the court held injunctive relief was appropriate to curb the recurring abuse of process. (Id., at p. 125.)22 Likewise, in Tranchina v. Arcinas (1947) 78 Cal.App.2d 522, 524 [178 P.2d 65], defendants were found liable for abuse of process when they used a writ of possession to evict plaintiffs from their home for an ulterior purpose, in circumvention of wartime housing regulations.
In all of these cases, more than a simple publication, which would be privileged under
The judgment is affirmed. Costs on appeal are awarded to respondents.
Lillie, P. J., concurred.
JOHNSON, J.—I concur in the judgment. My differences with the majority are solely at the margins of what is obviously a very scholarly opinion and in no way affect the outcome of this particular appeal. A full expression of those differences is best left for a future case where my reservations bear directly on issues determinative of the result.