A Twist: SLAPP Attorney’s Fees Not At Issue Here – Rather “Wrongful” Distribution Of Funds Held By Attorney Leads To Lawsuit And SLAPP Motion.
In the typical SLAPP case we report about, the issue is whether attorney’s fees will be recovered for prevailing on a SLAPP motion. But in our next case, the distribution of funds held in an attorney’s client trust account led to a lawsuit and a SLAPP motion. Old Republic Construction Program Group v. The Boccardo Law Firm, Inc., Case No. H037989 (6th Dist. Oct. 21, 2014) (certified for publication).
In a personal injury case, the law firm held settlement funds in trust “in stasis”, pursuant to a stipulation with the workers’ compensation carrier who asserted a right to reimbursement from the funds. After the law firm distributed the funds, without however a resolution of the rights of the carrier, the carrier sued the attorneys. The attorneys responded with a SLAPP motion, arguing that the lawsuit arose out of protected conduct, to wit, entering into a stipulation.
The Court of Appeal pointed out that “[i]f the protected status of an underlying agreement furnished sufficient ground to invoke the anti-SLAPP statute against a claim for breach of that agreement, it would follow that every suit to enforce a settlement agreement would be subject at the threshold to a SLAPP motion.” And that would not be a good result.
Here, the Court focused on the “wrongful, injurious acts or omissions identified in the complaint.” Those acts arose not from the stipulation (protected conduct) but from the release of funds in breach of the stipulation. And wrongful release of the settlement funds –being neither communicative in character, nor undertaken in connection with an issue of public importance – was not protected conduct. Hence, the trial court properly denied the SLAPP motion.
Affirmed.
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