Storix, Inc. v. Johnson

• Decision Date: 31 December 2020
• Docket Number: D077096,D075308
• Parties: STORIX, INC., Plaintiff and Respondent, v. ANTHONY JOHNSON, Defendant and Appellant; ANTHONY JOHNSON, Cross-complainant and Appellant, v. DAVID HUFFMAN et al., Cross-defendants, and Respondents; ANTHONY JOHNSON, Plaintiff and Appellant, v. DAVID HUFFMAN et al., Defendants and Respondents.
• Court: California Court of Appeals Court of Appeals

STORIX, INC., Plaintiff and Respondent, v. ANTHONY JOHNSON, Defendant and Appellant;

ANTHONY JOHNSON, Cross-complainant and Appellant, v. DAVID HUFFMAN et al., Cross-defendants, and Respondents;

ANTHONY JOHNSON, Plaintiff and Appellant, v. DAVID HUFFMAN et al., Defendants and Respondents.

D075308

D077096

COURT OF APPEAL, FOURTH APPELLATE DISTRICT DIVISION ONE STATE OF CALIFORNIA

December 31, 2020

ORDER MODIFYING OPINION AND DENYING REHEARINGNO CHANGE IN JUDGMENT

THE COURT:

It is ordered that the opinion filed herein on December 31, 2020 be modified as follows:

On page 14, insert the following at the end of footnote 6:

Johnson argues that the latter part of section 307(b) applies because no court ever found that "ratifying the lawsuit [two] years after it was filed was just and reasonable to Storix." The jury's verdict in favor of Storix and the subsequent judgment establish that Storix's action against Johnson was just and reasonable to Storix.

On page 23, remove the last paragraph and replace it with the following paragraph:

" 'Compliance with the requirements for filing a notice of appeal is mandatory and jurisdictional,' and an appellate court therefore must dismiss an appeal that is untimely." (Starpoint Properties, LLC v. Namvar (2011) 201 Cal.App.4th 1101, 1107.) "An order granting or denying a special motion to strike shall be appealable under [Code of Civil Procedure] Section 904.1." (Code Civ. Proc., § 425.16, subd. (i).) Code of Civil Procedure section 904.1 similarly provides that "[a]n appeal . . . may be taken . . . [f]rom an order granting or denying a special motion to strike under [Code of Civil Procedure] Section 425.16." (Code Civ. Proc., § 904.1, subd. (a)(13); Reyes v. Kruger (2020) 55 Cal.App.5th 58, 67 [grant]; Kyle v. Carmon (1999) 71 Cal.App.4th 901, 906 [same]; People ex rel. Lockyer v. Brar (2004) 115 Cal.App.4th 1315, 1317 [denial].) An appeal also lies if the trial court denies the motion as to some causes of action, for example where the complaint contains claims arising from both protected and unprotected activity. (Baral v. Schnitt (2016) 1 Cal.5th 376, 381-382, 394; Old Republic Construction Program Group v. The Boccardo Law Firm, Inc. (2014) 230 Cal.App.4th 859, 866, fn. 4.) Additionally, an attorney fees and costs award to a prevailing defendant on an anti-SLAPP motion is directly appealable. (City of Colton v. Singletary (2012) 206 Cal.App.4th 751, 782.)

On page 32 remove the second full paragraph, replace it with the following paragraph and add new footnote 13 as indicated:

Johnson cited no authority in his opening brief to support giving the disputed paragraph. In his reply brief, Johnson cited out-of-state authority to support instructing with the disputedparagraph. Out-of-state authority is not binding on California courts. (Doe v. Occidental College (2019) 37 Cal.App.5th 1003, 1018, fn. 2.) Additionally, the cases cited by Johnson during his rebuttal oral argument (Neider v. Dardi (1955) 130 Cal.App.2d 646 (Neider) and Brown v. Allied Corrugated Box Co. (1979) 91 Cal.App.3d 477 (Brown)) do not assist him because these cases do not relate to this issue. [Insert new footnote 13] In any event, we are not convinced that removal of the disputed paragraph prejudiced Johnson.

Text of new footnote 13:

Neider, supra,130 Cal.App.2d 646 concerns the appointment of a receiver arising from a conflict between two joint venturers and a corporation. (Id. at p. 647.) Brown, supra, 91 Cal.App.3d 477 concerns an action by minority shareholders in a closely held corporation to involuntarily dissolve the corporation and an appraisal requested by the majority shareholders to ascertain the value of the minority shares. (Id. at pp. 479-480.) While these cases contain language that arguably supports Johnson's position (Neider at p. 649; Brown at p. 487), neither case stands for the proposition that majority shareholders may breach their fiduciary duties by denying the minority shareholder a position with the company. (California Building Industry Assn. v. State Water Resources Control Bd. (2018) 4 Cal.5th 1032, 1043 [a case does not stand for a proposition it does not address].)

On page 36, renumber existing footnote 13 to footnote 14.

There is no change in judgment.

The petition for rehearing filed by Anthony Johnson is denied.

HALLER, Acting P. J.

Copies to: All parties

NOT TO BE PUBLISHED IN OFFICIAL REPORTS

California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.

(Super. Ct. No. 37-2015-00028262-CU-BT-CTL Consolidated under lead case Super. Ct. No. 37-2015-00034545-CU-BC-CTL)

(Super. Ct. No. 37-2019-00002457-CU-BT-CTL)

CONSOLIDATED APPEALS from a judgment and orders of the Superior Court of San Diego County, Kevin A. Enright and Katherine A. Bacal, Judges. Affirmed.

Anthony Johnson, in pro. per. for Defendant, Cross-complainant, Plaintiff, and Appellant.

Procopio, Cory, Hargreaves & Savitch, Kendra J. Hall, Paul A. Tyrell and Sean M. Sullivan for Plaintiff and Respondent, Storix, Inc.

Wilson, Elser, Moskowitz, Edelman & Dicker and Marty B. Ready for Cross-defendants, Defendants, and Respondents David Huffman, Richard Turner, Manuel Altamirano, David Kinney and David Smiljkovich.

These consolidated appeals arise from business disputes between Storix, Inc., a software company, and its founder Anthony Johnson. The disputes resulted in several different lawsuits, three of which are before us in this proceeding.

First, after Johnson started a new company, Storix sued Johnson for breach of fiduciary duty, and Johnson cross-complained against certain Storix officers and directors, alleging breach of fiduciary duty and other claims. This lawsuit will be referred to as the fiduciary duty action. Second, Johnson and another individual filed a shareholders' derivative lawsuit on Storix's behalf against the same officers and directors. This lawsuit will be referred to as the derivative action.

Those two lawsuits (the fiduciary duty and derivative actions) were consolidated. A jury trial was held first on the fiduciary duty action, and the jury returned verdicts in favor of Storix on the complaint and in favor of the defendants on the cross-complaint. The court (Judge Enright) then held a bench trial on the derivative action, and found the action lacked merit. Thecourt entered a single final judgment, and later entered a postjudgment order awarding costs and fees to Storix and certain Storix directors.

In the third lawsuit, Johnson filed an action against certain Storix directors, alleging malicious prosecution and other torts (the malicious prosecution action). These defendants filed an anti-SLAPP motion, but Johnson dismissed his complaint before the motion was heard. The court (Judge Bacal) then entered an order awarding $12,237.50 in attorney fees and $2,364.45 in costs to defendants under the anti-SLAPP statute.

Johnson filed two appeals. In the first, he challenges the final judgment in the fiduciary duty and derivative consolidated actions. Johnson contends the court erred in each of those actions, and in its postjudgment orders. In his second appeal, Johnson challenges the court's attorney fees order in the malicious prosecution action. We consolidated these appeals.

After carefully reviewing the parties' briefs, record, and applicable law, we determine Johnson has not met his burden to show prejudicial error in either appeal. We thus affirm the challenged judgment and orders.

FACTUAL AND PROCEDURAL SUMMARY¹

Background

Storix develops and sells a software product called System Backup Administrator (SBAdmin). Johnson founded Storix in 1998 as a sole proprietor and incorporated the company in 2003. He was Storix's only shareholder until 2010.

In 2011, Johnson resigned as an officer and director of Storix after being diagnosed with a serious health condition. He transferred management and operational responsibilities to then-employees David Huffman, Richard Turner, Manuel Altamirano and David Kinney. Johnson also caused Storix to grant these individuals shares amounting to a combined 60 percent stake in Storix, in exchange for their agreement to stay with the company for two years. Johnson retained the other 40 percent of Storix shares. Johnson elected Huffman, Turner, Altamirano and Kinney to Storix's board of directors and elected Huffman as Storix's president. In 2012, Storix hired David Smiljkovich as its chief financial officer (CFO). We collectively refer to Smiljkovich, Huffman, Turner, Altamirano and Kinney as the Individual Defendants.

In 2013, Johnson's health crisis resolved and he began working as a Storix employee. In May 2014, Johnson resigned his employment at Storix citing a lack of opportunity and disagreement with the company's vision regarding the software.

Three months later, Johnson filed a copyright infringement action in federal court against Storix. While the copyright infringement matter was pending, Johnson and fellow shareholder, Robin Sassi, were elected to Storix's board. At that time, Storix had five board members consisting of Johnson, Sassi, and three of the Individual Defendants (Huffman, Turner, and Altamirano). The day after this election, Johnson incorporated Janstor Technology (Janstor), a company that intended to sell a product based on the SBAdmin source code. Johnson believed the Individual Defendants were going to ruin Storix and decided to "rebrand[]" software he had been working on at home. Johnson denied forming Janstor to compete with Storix.

Filing of Fiduciary Duty and Derivative Actions

In August 2015, Storix filed the fiduciary duty action against Johnson and Janstor. Storix alleged Johnson breached his fiduciary duties by forming Janstor to compete with Storix.

The following month, on September 26, Johnson sent an email to Storix's...