OLD REPUBLIC CLARIFIES "GRAVAMEN" TEST AND ADOPTS BROAD CONSTRUCTION

In a case that looks remarkably similar to Navellier v. Sletten (2002) 29 Cal.App.4th 82, the recent  case of  Old Republic Construction Program Group v. Boccardo Law Group (6/27/14 2014) 2014 WL 2900932, the court distinguished Navellier using the elusive "Gravamen" test.   The question presented is whether the statute applies to claims alleging that defendants wrongfully withdrew settlement funds derived from a now-defunct lawsuit, which they had deposited into their trust account pursuant to a stipulation requiring Old Republic's consent prior to any withdrawal of funds.   The thrust of all causes of action is that defendants Boccardo and Stein breached the contract and committed fraud and breach of fiduciary duty by dispersing the settlement proceeds without Old Republic's consent.   The trial court granted the SLAPP motion based on Navellier, supra.   But the Court of Appeal reversed.   The court held that if the cause of action arose from the stipulation, then Navellier would apply and the motion should have been granted.   The court, however, reasoned that the injury-producing conduct upon which the cause of action was based consisted of nothing more than than the withdrawal of funds - a noncommunicative act.   By its plain language the first 3 subdivisions of section 425.16 only apply to oral or written statements - communicative acts.   Because the withdrawal of funds was not communicative, that act could not be subject to anti-SLAPP treatment unless it were connected to a public issue under subd. (e)(4).   Because there was no connection to a public issue, the court held that prong one was not met and denied the SLAPP motion accordingly.

The court reviewed prior cases and obeserved that a cause of action can only be said to arise from protected conduct if it alleges at least one wrongful act - conduct allegedly breaching a duty and injuring the plaintiff - that falls within the definition of protected conduct.   This is a proper broad plain language construction of the gravamen/mixed cause of action test.   Cases to the contrary, are repugnant to the statute's plain language and legislative purpose.   But the CA High Court will have to weigh in to definitively resolve the conflict.

The lesson I have been teaching to students and lawyers for years is that simply because you see protected activity floating around in the cause of action, does not mean that the liability arises from it.   It is the injury-producing conduct that must be the focus.

The court also canvassed a plethora of  authorities and held that an order partially granting a SLAPP motion and partially denying a SLAPP motion is immediately appealable under CCP 904.1(a)(13).

Old Republic is an interesting case and provides much guidance and a clearer test for determining the gravamen of a cause of action.
  
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