Does California’s Anti-SLAPP Law Apply When a Demand Letter Seeking to Resolve a Fee Dispute Threatens to Seek Assistance from the State Bar?
California’s anti-SLAPP law protects defendants from having to spend the time and money in protracted litigation defending a frivolous case. The anti-SLAPP law provides defendants a quick procedure – a special motion to strike – to test the evidence and obtain a dismissal in case’s infancy. It has long been established that defendants who are accused of conduct that is unquestionably and conclusively criminal cannot file a special motion to strike. (Flatley v. Mauro (2006) 39 Cal.4th 299, 319.) For example, lawyers who write demand letters in civil litigation that threaten State Bar disciplinary proceedings run the risk of being sued for extortion to the extent that their letters are threatening to initiate bar proceeding in exchange for settlement of a civil dispute. And such lawyers who are later sued for extortion based on such a letter cannot then avail themselves of the expedient anti-SLAPP mechanism normally allowed where pre-litigation communications are the basis of a lawsuit.
Earlier this month, the Second District Court of Appeal issued an unpublished decision in Liu v. Songfong Wang (Feb. 11, 2021, B303323) that addressed a new fact pattern arising in the context of attorney fee disputes: may a lawyer that sends a demand letter to an attorney in a fee dispute who threatens to “seek assistance from the State Bar” and is thereafter sued for extortion take advantage of California’s anti-SLAPP law? That is, does such a demand letter constitute the type of conclusively criminal activity that excludes itself from the reach of California’s anti-SLAPP law? The Liu court answered the question no. Although the letter threatened to seek assistance from the State Bar, the letter did not explicitly mention or threaten either disciplinary proceedings or mandatory fee arbitration. Because one interpretation of the letter was the implied threat to initiate mandatory fee arbitration rather than disciplinary proceedings, the Liu court found that the conduct giving rise to the lawsuit was not conclusively criminal in nature. But the best practice to avoid being sued for extortion and having to litigate an anti-SLAPP motion is to simply avoid mentioning the State Bar in demand letters.