Platypus Wear, Inc. v. Goldberg

• Decision Date: 05 September 2008
• Docket Number: No. D050305.,D050305.
• Citation: 166 Cal.App.4th 772,83 Cal. Rptr. 3d 95
• Court: California Court of Appeals Court of Appeals
• Parties: PLATYPUS WEAR, INC., et al., Plaintiffs and Respondents, v. MARTIN GOLDBERG, Defendant and Appellant.

166 Cal.App.4th 772

83 Cal. Rptr. 3d 95

PLATYPUS WEAR, INC., et al., Plaintiffs and Respondents, v. MARTIN GOLDBERG, Defendant and Appellant.

No. D050305.

Court of Appeals of California, Fourth District, Division One.

September 5, 2008.

Sullivan, Hill, Lewin, Rez & Engel, David B. Hopkins, Candace M. Carroll and Robert P. Allenby for Defendant and Appellant.

Vantage Law Group, Michael H. Riney and Karen B. King for Plaintiffs and Respondents.

OPINION

AARON, J.

I. INTRODUCTION

In October 2004, Platypus Wear, Inc., PW Industries, Inc. (collectively Platypus), Alexandra Ponce de Leon, and Sylvia Offner Caira, filed a complaint against Luce Forward Hamilton & Scripps, and two of its attorneys, Kevin A. Cahill and Timothy R. Pestotnik (collectively Luce Forward), Baker & McKenzie, and two of its attorneys, Charles H. Dick and Peter W. Ito, Laurens Offner (Laurens), and Martin Goldberg.¹ Among other claims, Platypus alleged that Goldberg had acted illegitimately as Platypus's chief financial officer, and that he assisted Laurens in taking a number of actions that had harmed Platypus's interests. In October 2006, more than two years after Platypus filed its complaint, Goldberg filed an application for leave of court to file a late special motion to strike the complaint (anti-SLAPP motion) (Code Civ. Proc., § 425.16).² A party may not file an anti-SLAPP motion more than 60 days after the filing of the complaint, unless the trial court affirmatively exercises its discretion to allow a late filing. (§ 425.16, subd. (f).) The trial court granted Goldberg's application to file a late anti-SLAPP motion. Goldberg filed an anti-SLAPP motion, which the trial court denied on the merits.

In this interlocutory appeal, Goldberg claims that the trial court erred in denying his anti-SLAPP motion. Platypus claims that the trial court erred in granting Goldberg's application to file the anti-SLAPP motion, and that the court properly denied the anti-SLAPP motion on the merits.

While there are no published cases in which a court has considered whether a trial court abused its discretion in granting a party's request to file a late anti-SLAPP motion, courts in several cases have discussed the purpose of the statutory 60-day period in affirming trial courts' refusals to consider a late filed anti-SLAPP motion on the merits. (See Kunysz v. Sandler (2007) 146 Cal.App.4th 1540, 1543 (Kunysz); Olsen v. Harbison (2005) 134 Cal.App.4th 278, 286 (Olsen); Morin v Rosenthal (2004) 122 Cal.App.4th 673, 681 (Morin).) For example, the Olsen court emphasized that the availability of an interlocutory appeal from the denial of an anti-SLAPP motion is related to the requirement that most such motions will be filed within 60 days of the filing of the complaint. (Olsen, supra, 134 Cal.App.4th at p. 287.) Such procedures facilitate the primary purpose of the anti-SLAPP statute, i.e., ensuring the prompt resolution of lawsuits that impinge on a defendant's free speech rights. (Kunysz, supra, 146 Cal.App.4th at p. 1543.) In exercising its discretion in considering a party's request to file an anti-SLAPP motion after the 60-day period, a trial court must carefully consider whether allowing such a filing is consistent with this purpose.

In the present case, Goldberg failed to provide a compelling explanation for why he did not file an application for permission to file an anti-SLAPP motion earlier in the case. Goldberg did not articulate any extenuating circumstances justifying a late filing. In particular, he did not explain why he did not file the application until after the parties had completed substantial discovery in the case. Under these circumstances, we conclude that the trial court abused its discretion in granting Goldberg's application to file his anti-SLAPP motion. We therefore reverse the trial court's order granting Goldberg's application to file the anti-SLAPP motion and vacate the trial court's ruling on the merits of the motion.

II. FACTUAL AND PROCEDURAL BACKGROUND

In its October 2004 complaint, Platypus alleged that Goldberg illegitimately acted as Platypus's chief financial officer and as a member of Platypus's board of directors from April 2002 through June 2003. Platypus claimed that Goldberg took a number of actions that were detrimental to Platypus's interests during this period, including receiving unauthorized compensation, causing Platypus to pay Laurens's personal legal fees, and wasting corporate assets. In a 53-page complaint, Platypus brought eight claims against Goldberg, including breach of fiduciary duty, aiding and abetting breach of a fiduciary duty, conversion, intentional and negligent interference with contractual relations, intentional and negligent interference with prospective economic advantage, and unfair business practices. The complaint also contained numerous claims against Luce Forward arising out of its prior representation of Platypus.

In December 2004, Goldberg answered the complaint.

On February 18, 2005, the trial court denied Luce Forward's motion to compel arbitration and stay the litigation pending arbitration. On February 25 Luce Forward filed an interlocutory appeal of the trial court's February 18 order. On March 11, Goldberg filed a motion to stay further trial proceedings pending resolution of Luce Forward's appeal. On March 25, the trial court stayed all proceedings in the case, pending the outcome of Luce Forward's appeal.

In February 2006, this court affirmed the trial court's denial of Luce Forward's petition to compel arbitration. (Platypus Wear, Inc. v. Cahill (Feb. 7, 2006, D046020) [nonpub. opn.].) In April, the remittitur issued in Platypus Wear, Inc. v. Cahill, supra, D046020. Also in April, the trial court lifted the stay of the trial court proceedings. In May, the trial court set a discovery cutoff date of September 29, 2006, and a trial date of October 20, 2006.

In June 2006, Luce Forward filed a motion seeking a determination that a settlement agreement between Platypus and Luce Forward had been entered into in good faith. In July, Goldberg filed an opposition to Luce Forward's motion. On July 18, the trial court granted Luce Forward's motion.

Also in July 2006, Goldberg requested a continuance of the trial date and the related discovery cutoff dates, and sought the appointment of a discovery referee. On August 18, the trial court granted Goldberg's request to continue the trial as "a last continuance." The court set December 15, 2006, as the discovery cutoff date and January 26, 2007, as the date for trial.

On October 31, 2006, Goldberg filed an ex parte application requesting that the court allow him to file an anti-SLAPP motion, and also asking that the trial date be continued for six months. Goldberg advanced three primary reasons why the trial court should grant his application. First, Goldberg argued that the public policy behind the anti-SLAPP statute supported granting the application. Goldberg maintained that he was seeking to file a potentially meritorious anti-SLAPP motion, and that he would be denied the opportunity to litigate the issue if the court were to deny his application. Second, Goldberg claimed that judicial economy would be served by allowing the filing because his meritorious motion would likely "dramatically pare down, if not entirely eliminate[]" the issues to be resolved at trial. Finally, Goldberg claimed that he would be willing to agree to several conditions designed to eliminate any prejudice Platypus might suffer as a result of the late filing. Specifically, Goldberg stated that he would agree to limit any attorney fees recoverable pursuant to the anti-SLAPP statute to those fees and costs directly related to the anti-SLAPP motion, and would also agree that Platypus could offset any such recovery by the fees and costs Platypus had directly incurred in prosecuting the action against Goldberg after the initial 60-day period for filing an anti-SLAPP motion as of right. Goldberg also stated that he would be willing to allow discovery to continue while his anti-SLAPP motion was pending.

In a footnote to his application, Goldberg stated that the "delay in this case is largely attributable to the manner in which this case proceeded." Goldberg noted that his present counsel was not counsel of record during the initial 60-day period after the filing of the complaint. Goldberg further stated that until the parties had conducted substantial discovery in the case, he had not appreciated that "virtually all of Plaintiffs' claims against him [involved] privileged and constitutionally protected conduct" on his part. Goldberg claimed that discovery had been delayed for various procedural reasons, including the stay of the trial court proceedings that occurred between March 2005 and April 2006.

Platypus filed an opposition to Goldberg's ex parte application. In its opposition, Platypus argued that the purpose of the anti-SLAPP statute—i.e., to foster the prompt resolution of lawsuits—would be undermined by allowing the late filing, and that Goldberg had offered no legitimate explanation for the approximately two-year delay in filing the motion. Platypus claimed that Goldberg's simultaneous request for a continuance of the trial date was "telling," and reflected an "attempted manipulation of the anti-SLAPP statute." Platypus also requested that, to the extent the court was inclined to consider granting Goldberg's application, the parties be afforded the right to brief the issue of the timeliness of the request in a properly noticed motion.

On November 1, 2006, the trial court held a hearing on Goldberg's application. At the outset of the hearing, the court indicated that its tentative ruling was to grant the application. The court acknowledged that Goldberg had filed the application "very late in the game," and noted that he had previously requested a continuance of the trial date. However, the court observed that the case was "fairly...