Mindys Cosmetics Inc v. Dakar

Decision Date06 July 2010
Docket NumberNo. 09-55134.,09-55134.
Citation611 F.3d 590
PartiesMINDYS COSMETICS, INC., A California Corporation, Plaintiff-Appellee,v.Sonya DAKAR, an individual; Donna Dakar, an individual, aka Daniella Dakar, Defendants,andKia Kamran, an individual, Defendant-Appellant.
CourtU.S. Court of Appeals — Ninth Circuit

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Al Mohajerian, Michael Thomas Smith, Mohajerian Law Corporation, Los Angeles, CA, for the appellee.

William K. Mills, Justin Davis Denlinger, Parker Shumaker Mills, LLP, Los Angeles, CA, for the appellant.

Appeal from the United States District Court for the Central District of California, Stephen V. Wilson, District Judge, Presiding. D.C. No. 2:08-cv-04459-SVW-RZ.

Before WILLIAM C. CANBY, JR. and W. FLETCHER, Circuit Judges, and JOHN R. TUNHEIM,* District Judge.

OPINION

WILLIAM A. FLETCHER, Circuit Judge:

Plaintiff-appellee Mindys Cosmetics, Inc. (Mindys) is a cosmetics company owned and operated by members of the Dakar family. Defendant-appellant Kia Kamran (Kamran) is an attorney. In 2007, Kamran registered two of Mindys' trademarks in Sonya Dakar's name. Israel and Natan Dakar brought suit in the name of Mindys against Sonya Dakar, Donna Dakar, and Kamran. Kamran moved under California's anti-SLAPP statute, Cal.Civ.Proc.Code § 425.16, to strike the claims against him. The district court denied the motion. Kamran brings an interlocutory appeal of the district court's denial. We affirm.

I. Background

This case arises from a dispute among members of the Dakar family over ownership of two trademarks: the Sonya Dakar mark and “The Problem Skin Specialists” mark. The family conflict pits Israel Dakar and his son Natan against Israel's wife Sonya Dakar, their son Yigal, and their daughters Daniella (Donna) and Michal (“Mimi”).

According to Israel Dakar, he and Natan founded Mindys Cosmetics in 1994 and have managed the company since 1999. In 2000 and 2001, Mindys registered the two trademarks at issue, listing Donna Dakar as the owner of the marks. In 2006, Yigal Dakar retained Kamran for a variety of services “on behalf of the family business.” Kamran was not involved in the 2000 trademark registration. In 2007, Kamran noticed that the Sonya Dakar mark had expired. Yigal, Donna, and Mimi instructed Kamran to consult Sonya about the registration. Sonya instructed Kamran to register both marks in her name, which Kamran did.

In 2008, Israel and Natan brought suit on behalf of Mindys against Sonya and Donna (the “Dakar Defendants) and Kamran. The complaint alleged trademark infringement by Sonya Dakar, legal malpractice and breach of fiduciary duty by Kamran, and fraudulent concealment and conversion by Kamran and the Dakar Defendants. Kamran moved under California's anti-SLAPP law Cal.Civ.Proc.Code § 425.16, to strike the claims against him. The district court denied Kamran's motion. It held that Mindys' suit against Kamran did not arise from protected conduct under the anti-SLAPP statute and that, even if it did, Mindys had demonstrated a probability of prevailing on the merits of its claims.

II. Jurisdiction and Standard of Review

We have jurisdiction to review the district court's denial of Kamran's anti-SLAPP motion under the collateral order doctrine. Hilton v. Hallmark Cards, 599 F.3d 894, 900 (9th Cir.2010); Batzel v. Smith, 333 F.3d 1018, 1024-26 (9th Cir.2003). We review de novo a district court's denial of a motion to strike under California's anti-SLAPP statute. Vess v. Ciba-Geigy Corp. USA, 317 F.3d 1097, 1102 (9th Cir.2003); see also Flatley v. Mauro, 39 Cal.4th 299, 326, 46 Cal.Rptr.3d 606, 139 P.3d 2 (2006).

III. Discussion

Kamran contends that Mindys' suit against him is a Strategic Lawsuit Against Public Participation (“SLAPP”) within the meaning of California's anti-SLAPP statute. See Cal.Civ.Proc.Code § 425.16. California enacted the anti-SLAPP statute “in response to the legislature's concern about civil actions aimed at private citizens to deter or punish them for exercising their political or legal rights.” United States ex rel. Newsham v. Lockheed Missiles & Space Co., 190 F.3d 963, 970 (9th Cir.1999). The statute was designed to allow courts “to promptly expose and dismiss meritless and harassing claims seeking to chill protected expression.” Bosley Med. Inst., Inc. v. Kremer, 403 F.3d 672, 682 (9th Cir.2005). The statute provides that a party may file a motion to strike a cause of action against it if the complaint “aris[es] 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.” Cal.Civ.Proc.Code § 425.16(b)(1). The statute is to be “construed broadly.” Id. § 425.16(a); Vess, 317 F.3d at 1109.

“A court considering a motion to strike under the anti-SLAPP statute must engage in a two-part inquiry.” Vess, 317 F.3d at 1110. First, the defendant must make a prima facie showing that the plaintiff's suit “arises from an act in furtherance of the defendant's rights of petition or free speech.” Id. (internal quotation marks omitted). “Second, once the defendant has made a prima facie showing, the burden shifts to the plaintiff to demonstrate a probability of prevailing on the challenged claims.” Id. (internal quotation marks omitted). The defendant bringing a motion to strike “need not show that the plaintiff's suit was brought with the intention to chill the defendant's speech” or “that any speech was actually chilled.” Id.

We hold that Kamran has made a prima facie showing that the suit against him “arises from” a protected act under the anti-SLAPP statute. However, Mindys has made a sufficient showing under the second part of the inquiry to withstand Kamran's motion to strike under the anti-SLAPP statute. We therefore affirm the district court's denial of Kamran's motion to strike.

A. Prima Facie Showing of a Protected Act

Defendant Kamran bears the burden of demonstrating that Mindys' suit against him arises from a protected act. Vess, 317 F.3d at 1110.

An “act in furtherance of a person's right of petition or free speech” includes:

(1) any written or oral statement or writing made before a legislative, executive, or judicial proceeding, or any other official proceeding authorized by law;
(2) any written or oral statement or writing made in connection with an issue under consideration or review by a legislative, executive, or judicial body, or any other official proceeding authorized by law;
(3) any written or oral statement or writing made in a place open to the public or a public forum in connection with an issue of public interest;
(4) or any other conduct in furtherance of the exercise of the constitutional right of petition or the constitutional right of free speech in connection with a public issue or an issue of public interest.

Cal.Civ.Proc.Code § 425.16(e). Kamran contends that filing a trademark application with the United States Patent and Trademark Office (“USPTO”) constitutes a protected act under categories (1) and (2). The district court did not determine whether this act constituted a protected act because it concluded that the suit did not “arise from” the filings even if they were protected. While it is a close question, we follow the California legislature's direction that the anti-SLAPP statute be “construed broadly,” id. § 425.16(a), and hold that Kamran's act of filing the trademark applications with the USPTO was a protected act within the meaning of the statute.

1. Protected Act

The filing of a trademark application is a formal communication to the USPTO seeking official action in a process governed by statute. See 15 U.S.C. § 1051 (“Application for registration; verification”). We conclude that the application is protected by the anti-SLAPP statute as a “writing made before ... [an] executive [or] ... other official proceeding authorized by law.” Cal.Civ.Proc.Code § 425.16(e)(1). The application may also be a “writing made in connection with an issue under consideration ... by ... [an] executive ... body, or any other official proceeding.” Id. § 425.16(e)(2).

California appellate courts interpreting the anti-SLAPP statute have distinguished between communications made in the course of “official” proceedings, which are protected, and mere “ministerial” business communications, which are not. For example, in ComputerXpress, Inc. v. Jackson, 93 Cal.App.4th 993, 1009, 113 Cal.Rptr.2d 625 (2001), the court of appeal found that filing a complaint with the SEC that was designed to solicit an investigation “qualified at least as a statement before an official proceeding” under § 425.16(e)(1). [C]ommunication to an official administrative agency ... designed to prompt action by that agency is as much a part of the ‘official proceeding’ as a communication made after the proceeding had commenced.” Id. (internal citations and some quotation marks omitted). In Kibler v. Northern Inyo County Local Hospital District, 39 Cal.4th 192, 199, 46 Cal.Rptr.3d 41, 138 P.3d 193 (2006), the California Supreme Court held that “a hospital's peer review procedure qualifies as an ‘official proceeding authorized by law’ ... because that procedure is required under [California] Business and Professions Code section 805 et seq., governing hospital peer review proceedings.” In Braun v. Chronicle Publishing Co., 52 Cal.App.4th 1036, 1049, 61 Cal.Rptr.2d 58 (1997), the court of appeal similarly concluded that an investigative audit conducted by a state auditor was “an authorized, public proceeding because it is government-sponsored and provided for by statute.”

In contrast, California appellate courts have held that “ministerial” acts involving primarily private transactions are not protected acts. For example, in Blackburn v. Brady, 116 Cal.App.4th 670, 677, 10 Cal.Rptr.3d 696 (2004), the court of appeal rejected the contention that statements...

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