Settlement Negotiations Fall Under Protection Of Anti-SLAPP Statute
Seltzer v. Barnes, No. A123784 (February 11; ordered published March 9), is a case from Division Five of the First Appellate District upholding the applicability of the anti-SLAPP statute (Code of Civil Procedure Section 425.16) to settlement negotiations. Barnes appealed from an order in the trial court denying his special motion to strike plaintiff Seltzer’s complaint. He contended that the trial court erred in concluding the plaintiff’s two causes of action against him did not arise from speech or petitioning activity where his alleged conduct was the negotiation of a settlement agreement in a prior case. The Court of Appeal agreed. That is the first hurdle for an anti-SLAPP motion. Moreover, the Court went on, because Barnes may not be held liable for the alleged conduct under the litigation privilege (Civil Code Section 47 (b)), Seltzer could not demonstrate a probability of success on the merits on her causes of action for fraud and intentional infliction of emotional distress. That is the second hurdle. The appellate court therefore directed the trial court to grant Barnes’ anti-SLAPP motion to strike.
The core of plaintiff’s claim was the notion that Barnes, acting on behalf of Allstate Insurance Company, secretly negotiated a settlement agreement that resulted in the dismissal of trespass claims against her. This resulted, she alleged, in her being injured because it led to Allstate’s refusal to pay defense expenses on the remainder of a cross-complaint against her, which Allstate asserted no longer involved a covered claim. The Court found GeneThera, Inc. v. Troy & Gould Professional Corp. (2009) 171 Cal. App. 4th 901, which also dealt with a settlement scenario, directly on point as to the applicability of the anti-SLAPP statute. The Court held that Barnes’ activity constituted petitioning activity on behalf of Allstate, which had ultimate authority over the settlement of any covered claim, and that this distinguished the case before it from others cited by plaintiff where illegal activity, such as a conflict of interest, was alleged. Here, in contrast, the behavior at issue was fully protected by the litigation privilege as discussed in Home Insurance Company v. Zurich Insurance Company (2002) 96 Cal. App. 4th 17, 23, where the court held that the “privilege has been extended to any communication, whether or not it is a publication, and to all torts other than malicious prosecution.” This includes torts such as fraud, negligent misrepresentation, and interference with contract. Thus, there was no possibility of plaintiff prevailing on her substantive claims.
March 9, 2010
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