Cmhe v. Sierra Club

• Decision Date: 15 December 2008
• Docket Number: No. S143087.,S143087.
• Court: California Supreme Court
• Parties: CLUB MEMBERS FOR AN HONEST ELECTION, Plaintiff and Appellant, v. SIERRA CLUB, et al., Defendants and Appellants.

196 P.3d 1094

86 Cal.Rptr.3d 288

45 Cal. 4th 309

CLUB MEMBERS FOR AN HONEST ELECTION, Plaintiff and Appellant, v. SIERRA CLUB, et al., Defendants and Appellants.

No. S143087.

Supreme Court of California.

December 15, 2008.

Law Offices of Ian B. Kelley, Ian B. Kelley, San Francisco, Conrad Wu; Law Office of Jeff D. Hoffman and Jeff D. Hoffman, San Francisco, for Plaintiff and Appellant.

Davis Wright Tremaine, Thomas R. Burke, san Francisco, Rochelle L. Wilcox, Los Angeles, and Susan E. Seager, for Defendants and Appellants.

Law Offices of James Wheaton and James R. Wheaton, Oakland, for Senator Sheila Kuehl as Amicus Curiae on behalf of Defendants and Appellants.

CORRIGAN, J.

Code of Civil Procedure section 425.16,¹ commonly referred to as the anti-SLAPP statute,² provides that a civil cause of action may be dismissed as a strategic lawsuit against public participation (SLAPP). Section 425.17, subdivision (b) (section 425.17(b)) provides an exception to the anti-SLAPP statute by exempting some actions from dismissal. Here, we hold the exception applies only when the entire action is brought in the public interest. If any part of the complaint seeks relief to directly benefit the plaintiff, by securing relief greater than or different from that sought on behalf of the general public, the section 425.17(b) exception does not apply.

Accordingly, we reverse a contrary judgment by the Court of Appeal. However, we affirm that part of the judgment holding that the trial court properly struck parts of the complaint under the anti-SLAPP statute because its order established that plaintiffs did not show a probability of prevailing.

FACTS AND PROCEDURAL BACKGROUND³

The Sierra Club (Club), the nation's largest environmental organization, is governed by a 15-member board of directors (Board), who are elected for three-year staggered terms. The Club holds elections for five directors each year. A nominating committee chooses a slate of candidates, but other candidates may be nominated by member petition.

While total Club membership exceeds 700,000, member participation in annual elections is generally low.⁴ As a result, the vote of a small number of members may disproportionately influence the outcome. In 2003, there was a rift among the Board members. A majority favored current policies, while a minority sought to take the Club in a different direction. Ballots for the 2004 election were to be mailed in February. On January 30, 2004, in response to a perceived threat posed by candidates favoring the minority view, the Board held a meeting and took the actions that led to this litigation.

First, the Board voted to disseminate an article to all chapter newsletters. Written by Drusha Mayhue, it cautioned that low member participation in elections made the Club vulnerable to takeover efforts by those whose agenda differed from that of the majority.

Second, the Board also directed that an "urgent election notice" be attached to the front of voting materials. The notice warned of "an unprecedented level of outside involvement and attention" to the Club's election and named a number of outside groups that "may be attempting to intervene" in the election. Though the notice itself did not refer to specific candidates, ballot materials included statements of three candidates who disclaimed any personal interest in being elected. Instead, those three candidates' statements urged members to vote for the Club's nominating committee slate or against candidates supported by outside groups.⁵

Plaintiff and candidate Robert van de Hoek, and a group supporting him, Club Members for an Honest Election (CMHE), objected to the Club's distribution of this material and sought injunctive relief. As amended, the complaint alleged that the Club had distributed information supporting some candidates and opposing others. It also alleged that candidates opposed by the Club were not given an opportunity to present contrasting views and challenged the inclusion of statements by "three fake Board candidates." The Club defeated plaintiffs' requests for temporary and preliminary restraining orders. Using the anti-SLAPP statute, it successfully urged the court to strike a portion of the complaint seeking to enjoin or censor future speech. Plaintiffs did not appeal the order to strike. The election went forward; van de Hoek was not among those elected to the Board.

Several months after the election, van de Hoek and CMHE filed a second amended complaint against the Club and added six individual directors as defendants. The complaint alleged four causes of action: (1) a challenge to the validity of the election under Corporations Code section 5617; (2) a petition for declaratory relief; (3) breach of fiduciary duty; and (4) violation of Business and Professions Code section 17200. The third cause of action was aimed, in part, at directors Nick Aumen and Jan O'Connell, who ran successfully on the nominating committee slate. It alleged that they breached their fiduciary duty by voting for the Board actions taken at the January 30, 2004 meeting. The complaint sought extensive injunctive relief, including the removal of five elected or appointed Board members and the installation of van de Hoek and four other unsuccessful candidates. It sought both to bar those removed directors from running for the Board in the 2005 election and to bar Aumen and O'Connell from ever running for the Board again.

Again relying on the anti-SLAPP statute, the Club moved to strike the second amended complaint. The parties also filed competing motions for summary judgment. With regard to the anti-SLAPP motion, the court held that voting as a director is protected under the First Amendment to the United States Constitution (First Amendment.) Thus, it struck the third cause of action alleging that the votes of Aumen and O'Connell breached a fiduciary duty. It also struck a paragraph of the first cause of action that referred to the votes of the directors. The balance of the motion to strike was denied. The court went on to deny plaintiffs' motion for summary judgment and to grant that of the defendants. The complaint was then dismissed in its entirety. In connection with the Club's partially successful anti-SLAPP motions, the court awarded fees and costs in the amount of $37,010.76.

Plaintiff van de Hoek did not appeal. CMHE did not challenge the summary judgment rulings, but did appeal the anti-SLAPP rulings and related fee and cost awards. The Club cross-appealed from the partial denial of the motion to strike, arguing that the entire complaint arose from defendants' protected activities.

The Court of Appeal held that plaintiffs' breach of fiduciary duty cause of action arose from protected First Amendment activity, and was thus subject to the Club's motion to strike.

The Court of Appeal also held that certain causes of action fell under section 425.17(b), the public interest exception to the anti-SLAPP statute, and that those particular causes of action should not have been struck. The Court of Appeal concluded that the first, second and fourth causes of action were exempt from the anti-SLAPP statute under the public interest exception. Because CMHE challenged the Club's election procedures on the ground that they constituted an unfair manipulation of an election to defeat candidates advancing views at odds with those of the existing board of directors, the Court of Appeal held that the "principal thrust or gravamen" of these causes of action were consistent with a public interest action. The Court of Appeal relied in large measure on case law interpreting section 1021.5, the private attorney general statute, which awards attorney fees to a party whose action has resulted in the enforcement of an important right affecting the public interest. By analogy, the Court of Appeal concluded that, even when a plaintiff has a personal stake in a case, the litigation could still involve an important legal issue of public interest, the resolution of which could benefit the public as a whole and transcend the plaintiff's personal interest. In applying the "principal thrust or gravamen" test, the Court of Appeal erred.

DISCUSSION

The statutory scheme

In 1992, the Legislature enacted section 425.16, the anti-SLAPP statute, to provide for the early dismissal of unmeritorious claims filed to interfere with the valid exercise of the constitutional rights of freedom of speech and petition for the redress of grievances. (Martinez v. Metabolife Internat., Inc. (2003) 113 Cal.App.4th 181, 186, 6 Cal. Rptr.3d 494.) The Legislature authorized the filing of a special motion to strike such claims, (§ 425.16, subds.(b)(1), (f)), and expressly provided that section 425.16 should "be construed broadly." (§ 425.16, subd. (a); see Briggs v. Eden Council for Hope and Opportunity (1999) 19 Cal.4th 1106, 1119, 81 Cal.Rptr.2d 471, 969 P.2d 564.) Such a motion requires a two-step process. First, the defendant must make a prima facie showing that the "cause[s] of action . . . aris[e] from" the defendant's actions "in furtherance of that [defendant's] right of . . . free speech . . . in connection with a public issue." (§ 425.16, subd. (b)(1).) If a defendant meets this threshold showing, the plaintiff must establish "a probability that the plaintiff will prevail on the claim[s]." (Ibid.)

In 2003, the Legislature enacted section 425.17 to curb the "disturbing abuse" of the anti-SLAPP statute. (§ 425.17, subd. (a).) This exception statute covers both public interest lawsuits, under subdivision (b), and "commercial speech," under subdivision (c). This case involves only the application of subdivision (b), which provides: "Section 425.16 does not apply to any action brought solely in the public interest or on behalf of the general public if all of the following conditions exist: [¶] (1) The plaintiff does not seek any relief greater than or different from the relief sought for the general public or...