Lee v. KimLee v. Kim
- Reporters:
- ,
- Before:
- Rothschild, Chaney, Weingart J.**
APPEALS from orders of the Superior Court of Los Angeles County, Dalila Corral Lyons and Richard E. Rico, Judges. Affirmed.
Employment Rights Attorneys and Richard D. Schramm for Plaintiff and Appellant Tae Seog Lee and Plaintiff and Respondent Grip Smart Printing, Inc.
Lim Law Group and Preston H. Lim for Defendant, Appellant and Respondent
INTRODUCTION
These consolidated appeals arise out of two separate orders under the anti-SLAPP statute addressing special motions to strike malicious prosecution claims.1 Our chronicle begins when attorney Jong Jun Kim commenced a lawsuit against businessman Tag Seog Lee in federal court for alleged violations of the Americans with Disabilities Act (ADA;
Lee thereafter sued Kim for malicious prosecution. Kim responded with a special motion to strike pursuant to
Lee now appeals the grant of Kim’s special motion to strike Lee’s claim. Kim appeals the denial of his special motion to strike Grip Smart’s claim. Finding no reversible error in either ruling, we affirm.
BACKGROUND
A. Grip Smart’s Business Premises
In 2008, Lee and his wife purchased an existing printing business called “Smart Printing.” They incorporated the business as Grip Smart in 2009. At the time, the business was one of 12 tenants in a commercial building owned by Yong O. Hwang (Hwang) and his company, Yongo America, Inc. (Yongo). Yongo and Hwang also owned the building’s parking lot. Lee entered into a series of oral and written leases with Yongo for the shop premises. Lee and his wife have never had an ownership interest in Yongo, the building, or the parking lot.
The leases define “common areas” as the “parking lots, sidewalks, driveways and other areas used in common by the Tenants of the Shopping
Yongo reserved the right to make changes to the “entrances, exits, traffic lanes and the boundaries and locations of such parking area or areas,” including “the right to designate up to twenty-five percent (25%) of such parking area for the exclusive use of any . . . future tenant or tenants.” Lee alleged that, as a tenant, he never had the right to control the parking lot.
Yongo was further responsible for causing the “common and parking areas” “to be graded, surfaced, marked and landscaped,” and for keeping these areas “in a neat, clean[,] orderly” and repaired condition. Yongo reserved the right to determine whether anyone other than customers of the building were permitted to park their vehicles in the parking lot. The building’s tenants, including Lee, agreed to comply with “rules, regulations and charges for parking” as established by Yongo.
B. The Underlying Action
On September 18, 2016, Kim filed a complaint in federal court on behalf of Patricia Sue Williams against Taesik Yoon, doing business as “Smart Printing.” The lawsuit (the Underlying Action) sought damages, injunctive relief, and attorneys’ fees for violations of the ADA and the Unruh Act.3 Williams is a paraplegic who uses a wheelchair for mobility. On behalf of Williams, Kim alleged Yoon was the owner of Smart Printing. Kim alleged Williams attempted to patronize the business in September 2016 but was unable to do so because the parking lot lacked an accessible parking space. Kim alleged that, on information and belief, a fully compliant parking space for persons with disabilities once existed in the lot, but Yoon failed to maintain the space and allowed the paint markings for the access aisle to fade beyond visibility. The complaint alleged the inaccessible parking lot denied Williams “full and equal access” to the printing business. Despite the fact that Williams did not enter the business, Kim alleged Williams “belie[ved]” there were additional “barriers” to access at the property and would amend
the complaint once Williams was able to access Smart Printing’s premises and conduct an inspection.
On November 2, 2016, counsel for Lee and Grip Smart sent a letter to Kim advising that Grip Smart had no control over the parking lot and the claims in the Underlying Action were meritless. Counsel advised Kim that Yongo owned the building and parking lot where Williams allegedly encountered her disability access issues, and offered to provide Kim with the lease agreement applicable to the property. Kim declined to amend the complaint to name Yongo and instead demanded payment from Grip Smart.
On November 4, 2016, counsel sent another letter to Kim advising Kim of the following: (1) Grip Smart had no custody or control over the property giving rise to Williams’s claims; (2) Kim needed to sue Yongo, the actual owner of the parking lot; (3) Grip Smart was not liable to Williams simply by virtue of its tenancy in the building next to the parking lot; (4) federal law excluded tenants from disability access liability in cases like Williams’s; (5) Kim’s refusal to name the property owner was evidence of his malicious intent to pursue the lawsuit solely to exact a monetary settlement; and (6) photographs of the parking lot at issue showed properly marked handicap parking, evidencing the lack of merit to the claims. Counsel also sent Kim a copy of Grip Smart’s
lease.4 Counsel asked Kim to dismiss Lee from the lawsuit and warned that his clients would seek sanctions under rule 11 of the Federal Rules of Civil Procedure if Kim continued to pursue claims against them.
Pursuant to a stipulation signed by Lee, in January 2017 Kim again amended the complaint in the Underlying Action to add Grip Smart and Yongo as defendants. The second amended complaint did not include Yoon and Lee as defendants, and the stipulation stated that Williams would seek to dismiss Yoon and Lee without prejudice.5 The second amended complaint identified Grip Smart as the operator of the printing business and Yongo as the owner of the property at which the business was located.
When Kim failed to dismiss Grip Smart, counsel for Grip Smart moved for judgment on the pleadings pursuant to the
C. The Malicious Prosecution Actions
1. Lee v. Kim
(a) The Complaint
A few months after entry of judgment in the Underlying Action, Lee filed a complaint against Kim for malicious prosecution. Lee alleged Kim filed the Underlying Action without investigating who owned the parking lot, then asserted claims against Lee’s business in the second amended complaint after having been advised Yongo owned, and was in control of, the parking lot. Lee alleged Kim continued to prosecute claims against Grip Smart after learning Grip Smart had no control over the parking lot, and after admitting in each iteration of the complaint that Williams observed no accessibility violations inside Grip Smart’s facility. Lee alleged the ownership of the
relevant land, parking lot, and buildings was easily discoverable by a search of the records of the Los Angeles County Recorder’s Office, yet Kim never conducted this simple research.
Lee also alleged that the settlement agreement with Yongo did not address any correction of the disability access issues in the parking lot, but rather provided for only monetary compensation. As a further indication of improper purpose in filing and maintaining the Underlying Action, Lee alleged
(b) The Special Motion to Strike
Kim responded by filing a special motion to strike, arguing Lee’s malicious prosecution complaint arose from Kim’s protected activity of representing Williams in the Underlying Action and petitioning on her behalf. Kim argued Lee had no probability of prevailing on his malicious prosecution claim because Lee did not receive a favorable determination on the merits of the Underlying Action, and the lawsuit was brought with probable cause and without malice. Specifically, Kim contended his voluntary dismissal of Lee from the Underlying Action—which occurred when Kim dismissed Lee in favor of adding Grip Smart as a defendant—was not a favorable determination on the merits because including Lee had “merely [been] a technical error.”
Kim further argued he had probable cause to file and maintain the Underlying Action because the lease with Yongo was “insufficient” to determine who was liable and, even after a settlement was reached, Yongo continued to assert Grip Smart should be responsible for 50 percent of the liability. With respect to the element of malice, Kim contended his only motive for filing the Underlying Action was to seek compensation for Williams, and there was no evidence he had any improper purpose for pursuing Lee.
In his opposition, Lee argued that he had prevailed on the merits, as Kim had initially sought individual liability against the owner of the business, and ultimately dismissed Lee. Lee further argued that Kim lacked probable cause to pursue Lee, as Kim knew as early as November 2016 that neither Lee nor his business owned the building or parking lot where Williams allegedly encountered access barriers. Finally, Lee argued Kim’s pursuit of individual liability and demands for monetary settlement supported a finding of malice.
(c) Court Ruling on the Special Motion to Strike
On November 6, 2017, Judge Lyons granted Kim’s special motion to strike. The court determined the complaint arose from protected activity, but
trial court did not reach the remaining elements of probable cause or malice. Pursuant to
2. Grip Smart v. Kim
(a) The Complaint
On January 29, 2018, after Lee’s complaint was struck, Grip Smart filed a separate complaint against Kim for malicious prosecution. Grip Smart’s complaint was nearly identical to Lee’s complaint, but added as additional evidence of Kim’s improper purpose an allegation that, following entry of judgment against his client, Kim entered Grip Smart’s facility and demanded Lee and his wife pay him $18,000 to settle “all” remaining legal
issues. Kim knew Grip Smart was still represented by counsel at that time.
(b) The Special Motion to Strike
As he had with regard to Lee’s complaint, Kim responded by filing a special motion to strike. Kim made the same arguments he made in the motion to strike Lee’s claim regarding probable cause and malice, but proffered a different theory as to why Grip Smart did not obtain a favorable termination on the merits in the Underlying Action. Kim asserted that the federal court’s dismissal of Williams’s claims against Grip Smart for lack of standing under article III of the Constitution was not ” ‘on the merits’ ” of the ADA and Unruh Act claims asserted in the Underlying Action.
(c) Court Ruling on the Special Motion to Strike
On April 17, 2018, Judge Rico denied Kim’s special motion to strike. The court found the malicious prosecution claim arose from protected activity, but that Grip Smart had made the requisite showing that it would probably prevail. The court rejected Kim’s argument that the dismissal of the Underlying Action for lack of article III standing was purely jurisdictional,
noting “the summary judgment ruling makes clear that this was not a mere technical dismissal for lack of jurisdiction. Having considered the evidence, the [federal] court made the determination that [Grip Smart] did not ‘own or control the parking lot where Williams alleged she encountered barriers to her disability . . . .’ ” Further, the trial court determined the lease “ma[de] no . . . provision” for Grip Smart’s ability to operate or control the parking lot, so “there was no basis for believing that [Grip Smart] was in any way responsible for the alleged ADA violation” and the lawsuit lacked probable cause.
The trial court was particularly troubled by Kim’s continued prosecution of the Underlying Action against Grip Smart even after he was made aware of the terms of the lease. In response to Kim’s contention that Grip Smart provided him with no evidence other than the lease to show a lack of ownership or control, and did not provide ” ‘sworn statements or declarations’ ” regarding the control issue until the motion for summary judgment, the trial court noted, “[i]t was not [Grip Smart’s counsel’s] obligation to prove a negative, it was Kim’s obligation to establish probable cause to continue the law suit for which apparently none existed.”
Lastly, the court found that Kim’s prosecution of the Underlying Action despite the lack of probable cause, along with the proffered evidence Kim
DISCUSSION
A. Applicable Law and Standard of Review
” ’ “The Legislature enacted the anti-SLAPP statute to protect defendants . . . from interference with the valid exercise of their constitutional rights, particularly the right of freedom of speech and the right to petition the government for the redress of grievances.” ’ ” (Bleavins v. Demarest (2011) 196 Cal.App.4th 1533, 1539.) The statute provides that “[a] cause of action against a person arising from any act of that person in furtherance of the person’s right of petition or free speech under the United States Constitution or the California Constitution in connection with a public issue shall be subject to a special motion to strike, unless the court determines that the plaintiff has established that there is a probability that the plaintiff will prevail on the claim.” (
“In evaluating an anti-SLAPP motion, the court conducts a potentially two-step inquiry. [Citation.] First, the court must decide whether the defendant has made a threshold showing that the plaintiff’s claim arises from protected activity. [Citation.] To
meet its burden under the first prong of the anti-SLAPP test, the defendant must demonstrate that its act underlying the plaintiff’s claim fits one of the categories spelled out in subdivision (e) of the anti-SLAPP statute.” (Bonni v. St. Joseph Health System (2017) 13 Cal.App.5th 851, 859, disapproved on another ground in Wilson v. Cable News Network, Inc. (2019) 7 Cal.5th 871, 892.)
“Second—if the defendant meets its burden of showing all or part of its activity was protected—then the court proceeds to the next step of the inquiry. At this stage—applying the second prong of the anti-SLAPP test—
An appeal from an order granting or denying a special motion to strike is reviewed de novo. (Soukup v. Law Offices of Herbert Hafif (2006) 39 Cal.4th 260, 269, fn. 3.) In considering the pleadings and supporting and opposing declarations, we do not make credibility determinations or compare the weight of the evidence. Instead, we accept the opposing party’s evidence as
true and evaluate the moving party’s evidence only to determine if it has defeated the opposing party’s evidence as a matter of law. (Ibid.)
B. Both Malicious Prosecution Claims Involved Protected Conduct
The first step of the anti-SLAPP inquiry, whether Kim made a threshold showing that the claims of Lee and Grip Smart for malicious prosecution arose from protected activity, is not disputed here. The anti-SLAPP statute defines an ” ‘act in furtherance of a person’s right of petition or free speech’ ” to include “any written or oral statement or writing made before a . . . judicial proceeding . . . .” (
C. Lee Did Not Demonstrate a Probability of Prevailing on the Merits
“To prevail on a malicious prosecution claim, the plaintiff must show that the prior action (1) was commenced by or at the direction of the defendant and was pursued to a legal termination favorable to the plaintiff;
The claims against Lee terminated when Kim, on behalf of his client, voluntarily filed a second amended complaint that dropped Lee as a defendant.8 “In order for a termination of a lawsuit to be considered favorable with regard to a malicious prosecution claim, the termination must reflect on the merits of the action and the plaintiff’s innocence of the misconduct alleged in the lawsuit.” (Contemporary Services Corp. v. Staff Pro Inc. (2007) 152 Cal.App.4th 1043, 1056.) While Kim acknowledges a voluntary dismissal is presumed to be a favorable termination on the merits (Sycamore Ridge Apartments LLC v. Naumann (2007) 157 Cal.App.4th 1385, 1400), he argues Lee’s dismissal was purely for technical reasons that did not reflect on the merits of the Underlying Action. Specifically, Kim asserts that he dropped Lee solely to “replace him with Grip Smart, who was the proper tenant and the real party-in-interest.”
Kim initially filed suit seeking to hold Lee individually liable. Kim dismissed Lee from the Underlying Action after being provided information showing Lee was not a proper defendant because he was not individually liable. It is plausible to conclude, as the trial court did, that Kim dismissed Lee because he believed liability still existed and rather than pursuing alter ego or other claims to pierce the corporate veil and hold Lee individually liable he decided instead to pursue Grip Smart. It is also plausible to conclude, however, that Kim dismissed Lee because the information Lee’s counsel provided
showed Lee was not liable under any circumstances. While the trial court’s inference that Lee’s dismissal did not reflect the substantive merits was plausible, in the “summary-judgment-like procedure” of a special motion to strike we do not weigh evidence or resolve conflicting factual claims. (Varian Medical Systems, Inc. v. Delfino (2005) 35 Cal.4th 180, 192.) We further must draw all reasonable inferences from the evidence in favor of Lee as the plaintiff. (Tuchscher Development Enterprises, Inc. v. San Diego Unified Port Dist. (2003) 106 Cal.App.4th 1219, 1238-1239.) Accordingly, Lee made the required prima facie showing that the Underlying Action terminated in his favor on the merits.
While we part ways with the trial court on whether there was prima facie evidence the Underlying Action was terminated favorably on the merits, we agree with the end result of striking Lee’s claim. To demonstrate a probability of prevailing on the second prong of the anti-SLAPP analysis, Lee
Lee takes the unfounded position that because the trial court did not discuss either the lack of probable cause or malice elements, he is likewise excused from addressing them. Although we examine the trial court’s decision independently, the scope of our review is limited to those issues that have been adequately raised and supported in the appellant’s brief. (Reyes v. Kosha (1998) 65 Cal.App.4th 451, 466, fn. 6.) Lee’s burden on appeal “includes the obligation to present argument and legal authority on each point raised. This requires more than simply stating a bare assertion that the judgment, or part of it, is erroneous and
leaving it to the appellate court to figure out why; it is not the appellate court’s role to construct theories or arguments that would undermine the judgment . . . .” (Eisenberg et al., Cal. Practice Guide: Civil Appeals and Writs (The Rutter Group 2018) ¶ 8:17.1, p. 8-6.) ” ‘When an appellant fails to raise a point, or asserts it but fails to support it with reasoned argument and citations to authority, we treat the point as [forfeited].’ ” (In re A.C. (2017) 13 Cal.App.5th 661, 672; accord, Stoll v. Shuff (1994) 22 Cal.App.4th 22, 25, fn. 1.)
Lee’s briefing fails to address Kim’s alleged lack of probable cause or malice, and contains no record cites or authorities supporting any claim that he satisfied the required showing on those elements. He has therefore forfeited any argument that he made the requisite prima facie showing on the remaining two elements of his malicious prosecution claim. At oral argument, Lee contended Kim continued to prosecute claims lacking probable cause after the lease was provided. Specifically, counsel for Lee argued that, after the lease was provided but before Lee was dismissed, Kim prepared and filed a report in the Underlying Action in compliance with rule 26 of the Federal Rules of Civil Procedure in which Kim continued to contend Lee was individually liable. Even if we overlooked that this argument was not raised in Lee’s briefing, neither the joint report itself nor any evidence regarding the date it was prepared or filed is part of the record on appeal. Accordingly, we cannot consider it. (See Vons Companies, Inc. v. Seabest Foods, Inc. (1996) 14 Cal.4th 434, 444, fn. 3.)9
D. The Denial
Kim makes the following claims of error with regard to the denial of his special motion to strike Grip Smart’s malicious prosecution claim: (1) the trial court improperly shifted the burden to him to show probable cause for filing and maintaining the Underlying Action; (2) the trial court erred in ruling Grip Smart achieved a favorable termination on the merits; (3) Grip Smart failed to demonstrate Kim lacked probable cause; and (4) no evidence existed to support the trial court’s finding that Kim pursued the Underlying Action with malice.
1. Burden of Proof
Kim contends the court “misapplied the burden shifting provision” in section 425.16 by imposing upon him the obligation to establish probable cause for Grip Smart’s malicious prosecution claim. Kim points to the following statement in the court’s order as evidencing this alleged error: “It was not [Grip Smart’s counsel’s] obligation to prove a negative, it was Kim’s obligation to establish probable cause to continue the law suit for which apparently none existed.”
Kim has plucked this sentence from the court’s order without context, and when the order is reviewed holistically it is
Lee’s objections to the evidence Kim submitted in support of his special motion to strike. It was Lee, not Kim, that was required to make the prima facie showing on the second prong. Given Lee’s failure of proof, any error with regard to consideration of evidence from the opposing party would not be prejudicial error because it would not lead to a more favorable result. (People ex rel. City of Santa Monica v. Gabriel (2010) 186 Cal.App.4th 882, 887.)
plain there was no improper burden shifting. First, elsewhere in its order the trial court correctly stated “[t]he second prong of the anti-SLAPP analysis is to determine whether the plaintiff has shown a probability of succeeding on his claim. [Citation.] The plaintiff bears the burden, but need make only a prima facie showing, ’ “akin to that of a party opposing a motion for summary judgment.” ’ ” Second, in making the statement cited by Kim, the trial court was responding to Kim‘s argument that counsel for Grip Smart did not provide any evidence other than the lease (such as sworn statements or declarations) until the time of summary judgment. Read in context, the trial court‘s statement was responding to this argument from Kim about his conduct after having been presented with the lease, and Kim‘s obligation to have probable cause to continue prosecuting a lawsuit. We see no indication the court misunderstood who bore the burden on the second prong of the anti-SLAPP analysis.
2. Favorable Termination on the Merits
To meet its prima facie burden, Grip Smart was first required to show the Underlying Action terminated favorably in a manner that reflected on the
Kim argued to the court below, as he does on appeal, that the federal court‘s ruling was a finding on jurisdictional grounds, and was therefore not on the merits. The trial court disagreed, noting “the summary judgment ruling makes clear that this was not a mere technical dismissal for lack of jurisdiction,” and that “[r]eading the ruling as a whole, ‘standing’ was not the only problem and was used as [a] means to test causation and damages.”
We agree with the trial court‘s analysis. While California law on standing generally asks only whether the plaintiff is the “real party in interest,”10 standing in federal court involves different considerations. Specifically, to establish a case or controversy within the meaning of
Kim cites federal authority noting that when a party lacks article III standing a court cannot reach the merits of the dispute ( Fleck and Associates v. Phoenix, City (9th Cir. 2006) 471 F.3d 1100, 1106, fn. 4), such that a dismissal for lack of article III standing is not a disposition on the merits for purposes of things like claim preclusion (Media Technologies Licensing, LLC v. Upper Deck (Fed. Cir. 2003) 334 F.3d 1366, 1369-1370), or an award of prevailing party attorneys’ fees under certain federal statutes. (Molski v. Mandarin Touch Restaurant (C.D. Cal., Dec. 9, 2005, No. CV04-0450 ER) 2005 WL 3719631 at *1.) These cases do not mean, however, that a dismissal for lack of article III standing can never be a favorable termination on the merits for purposes of a malicious prosecution claim. After all, voluntary dismissal precludes litigation on the ultimate merits in the same way as a dismissal for lack of article III standing and the law is well-established such voluntary dismissals can, in some circumstances, reflect on the substantive merits of the underlying claim. It is therefore not the type of dismissal, but the reasons for it, that must be examined to determine whether the dismissal reflects on the merits. (Robbins v. Blecher (1997) 52 Cal.App.4th 886, 892-894.)
Here, the article III standing test necessarily required the federal court to assess the merits of the claims in the Underlying Action, at least at the level necessary to determine if there was evidence the alleged injury was traceable to Grip Smart‘s actions. The federal court found the alleged injury was not traceable to Grip Smart‘s actions because it was undisputed Grip Smart did not own or control the parking lot where the alleged injury-in-fact occurred. Because the Underlying Action terminated based on the lack of any causal link between Grip Smart‘s actions and the alleged injury, the Underlying Action terminated in favor of Grip Smart in a manner that reflected on the merits of the claim.
3. Probable Cause
Grip Smart was required next to show Kim lacked probable cause to bring and maintain the Underlying Action. “The question of probable cause is ‘whether, as an objective matter, the prior action was legally tenable or not.’ [Citation.]” (Soukup v. Law Offices of Herbert Hafif, supra, 39 Cal.4th at p. 292.) The resolution of that question requires an objective determination of the reasonableness of the underlying lawsuit based on the facts known to the party bringing the suit. (Sheldon Appel Co. v. Albert & Oliker (1989) 47 Cal.3d 863, 878.) ” ‘A litigant will lack probable cause for his action either if he relies upon facts which he has no reasonable cause to believe to be true, or if he seeks recovery upon a legal theory which is untenable under the facts known to him.’ [Citation.]” (Soukup, supra, at p. 292.) The test to be applied in evaluating the existence of probable cause is “whether any reasonable attorney would have thought the claim tenable.” (Sheldon Appel Co., supra, at p. 886.)
In making an initial assessment of tenability, an attorney is entitled to rely on the information provided by the client, unless the attorney is on notice of specific factual errors in the client‘s version of events that render the claim untenable. (Swat-Fame, Inc. v. Goldstein (2002) 101 Cal.App.4th 613, 625-627, disapproved on other grounds in Reid v. Google, Inc. (2010) 50 Cal.4th 512, 532, fn. 7 and Zamos v. Stroud, supra, 32 Cal.4th at p. 973.) Even when an attorney receives evidence that appears to present a complete defense, the attorney may act reasonably in going forward with the lawsuit if there is a possibility that the defense will, on further evidence or examination, “prove less than solid.” (Zamos, supra, at p. 970, fn. 9.) However, an attorney who has probable cause to commence a lawsuit may be liable for malicious prosecution if he or she continues to prosecute the action after learning it is not supported by probable cause. (Id. at p. 973.)
Grip Smart does not contend that Kim lacked probable cause to initiate the action. Instead, Grip Smart takes issue with Kim‘s continued prosecution of the Underlying Action after November 2016, when Grip Smart‘s counsel notified Kim “of the proper names of the proper defendants, along with the actual terms identifying who controlled the parking lot where Williams‘[s] alleged discrimination occurred.”
Kim admits he received a copy of Grip Smart‘s lease on November 4, 2016, and does not dispute that the lease placed all responsibility for upkeep and maintenance of common areas—including the parking lot where Williams allegedly encountered a lack of accessible parking—on Yongo. Kim also acknowledges, by citing to them in his brief, that the
Nonetheless, citing Botosan v. Paul McNally Realty (9th Cir. 2000) 216 F.3d 827 (Botosan) as well as an earlier district court case (Botosan v. Fitzhugh (S.D.Cal. 1998) 13 F.Supp.2d 1047), Kim argues the terms of the lease had no bearing on the question of probable cause since “the allocation of responsibility between the landlord and a tenant by the lease is effective only ‘[a]s between the parties’ and has no effect on the rights of third parties.” In Botosan, a landlord argued it could not be held liable for ADA violations on leased property because responsibility for all ADA compliance had been shifted to its tenants vis-à-vis their leases. (Botosan, supra, at p. 832.) The Ninth Circuit examined the language and history of the ADA, and concluded the ADA imposes concurrent obligations on landlords and tenants, and that the landlord, as an owner of the property, should be liable for ADA compliance even on property leased to, and controlled by, a tenant. (Id. at pp. 832-834.)
The problem with Kim‘s reliance on Botosan is that it focuses on landlord responsibilities, and ignores a later Ninth Circuit opinion relieving tenants like Grip Smart from liability under the ADA in cases exactly like the present one. In Kohler v. Bed Bath & Beyond of California, LLC (9th Cir. 2015) 780 F.3d 1260, the plaintiff, a paraplegic who required the use of a wheelchair, alleged he encountered architectural barriers both inside the defendant‘s store and in the parking lot of the shopping center in which the store was located. (Id. at p. 1262.) The district court granted summary judgment in favor of the defendant, concluding the store “did not ‘own, lease or operate’ the shopping center parking lot, and therefore was not liable for any ADA barriers occurring there.” (Ibid.) On appeal, the plaintiff argued the defendant‘s lease, which defined the parking lot as a ” ‘Common Area’ ” and further stated that the ” ‘Landlord shall operate, maintain, repair and replace the Common Areas . . . [and] shall comply with all applicable Legal Requirements,’ was an attempt to contract away its ADA liability in violation of [the Ninth Circuit‘s] decision in [Botosan].” (Id. at p. 1264.)
The appellate court characterized the plaintiff‘s reliance on Botosan as “misplaced . . . . The ADA imposes compliance obligations on ‘any person who owns, leases (or leases to), or operates a place of public accommodation.’ (
While Kim‘s belief regarding Grip Smart‘s potential liability may have been tenable at the inception of the Underlying Action, Grip Smart introduced sufficient evidence for purposes of a special motion to strike that Kim‘s belief was no longer defensible in November 2016 after Kim was provided a copy of the operative lease. Other than his inapposite citation to Botosan, Kim points to nothing else that would defeat Grip Smart‘s claim as a matter of law. Grip Smart therefore made the requisite showing that continued prosecution after November 2016 was done without probable cause. (Soukup v. Law Offices of Herbert Hafif, supra, 39 Cal.4th at p. 292; accord, Arcaro v. Silva & Silva Enterprises Corp. (1999) 77 Cal.App.4th 152, 158-159 [“when a party is put on notice a fundamental element of its case is disputed, it should not proceed without evidence sufficient to support a favorable judgment on that element or at least information affording an inference such evidence can be obtained“].)
4. Malice
Grip Smart was finally required to make a showing sufficient to support the element of malice. (Sheldon Appel Co. v. Albert & Oliker, supra, 47 Cal.3d at p. 874.) ” ‘The “malice” element . . . relates to the subjective intent or purpose with which the defendant acted in initiating the prior action. [Citation.] The motive of the defendant must have been something other than that of . . . the satisfaction in a civil action of some personal or financial purpose. [Citation.] The plaintiff must plead and prove actual ill will or some improper ulterior motive.’ [Citations.] Malice ‘may range anywhere from open hostility to indifference. [Citations.] Malice may also be inferred from the facts establishing lack of probable cause.’ [Citation.]” (Soukup v. Law Offices of Herbert Hafif, supra, 39 Cal.4th at p. 292.)
“[M]alice can be inferred when a party continues to prosecute an action after becoming aware that the action lacks probable cause.” ( Daniels v. Robbins (2010) 182 Cal.App.4th 204, 226.) The Daniels court concluded malice formed after the filing of a complaint is actionable. ” ‘Continuing an action one discovers to be baseless harms the defendant and burdens the court system just as much as initiating an action known to be baseless from the outset.’ [Citation.]” (Ibid.)
Kim contends the trial court made no finding regarding malice. He appears to have overlooked the trial court‘s express finding that Kim had no probable cause to continue prosecuting the action, “and given the allegations by [Grip Smart] that when it confronted Kim with the facts [Grip Smart] was only threatened with a further demand for money, the court can reach but on[e] conclusion, the matter was pursued with malice.”
We agree that Grip Smart met its burden to show malice. In determining whether malice exists, we must accept as true the evidence favorable to the plaintiff. (Barker v. Fox & Associates (2015) 240 Cal.App.4th 333, 348.) Further, a reviewing court may consider not only facts supported by direct evidence, but also facts reasonably inferable from the evidence. (Oasis West Realty, LLC v. Goldman (2011) 51 Cal.4th 811, 822.) The facts on which the trial court relied to find malice were sufficient to meet the showing required to defeat a special motion to strike.
DISPOSITION
The order granting Kim‘s special motion to strike Lee‘s complaint in case No. B287923 is affirmed. The parties are to bear their own costs in that appeal.
The order denying Kim‘s special motion to strike Grip Smart‘s complaint in case No. B289837 is affirmed. Grip Smart is awarded its costs on appeal.
WEINGART, J.*
We concur:
ROTHSCHILD, P. J.
CHANEY, J.
* Judge of the Los Angeles Superior Court, assigned by the Chief Justice pursuant to article VI, section 6 of the California Constitution.
THE COURT*:
Good cause appearing, it is ordered that the opinion in the above entitled matter, filed October 2, 2019, be published in the official reports.
*ROTHSCHILD, P. J.
CHANEY, J.
WEINGART, J.**
** Judge of the Los Angeles Superior Court assigned by the Chief Justice pursuant to article VI, section 6 of the California Constitution.