The complex tort ofÂ malicious prosecutionÂ is frequently threatened yet rarely fully understood. Â One of the trickier elements to establish is a “favorable termination” of the prior action. Â Just because you won the prior lawsuit does not necessarily mean that California courts will recognize the victory as “favorable.”
A defendant’s trial victory establishes a favorable termination. Â Other modes of terminating a case are less clear. Â In looking at the prior action, the courts are concerned with whether the prior termination was a result of the assessment by a court or the prior plaintiff that the prior defendant was innocent.
Non-substantive victories.Â Â “Technical” or “procedural” victories are not “favorable” for purposes of a malicious prosecution action. Â Examples of such technical victories are dismissals arising from 1) statute of limitations; 2) settlement; 3) laches; 4) lack of jurisdiction; 5) mootness; 6) lack of standing; 7) res judicata; and 8)Â ripeness. Â (JSJ Ltd. Partnership v. MehrbanÂ (2012) 205 Cal.App.4th 1512, 1525). Â Such victories are considered non-substantive because they do not reflect a determination by the court or the prior plaintiff that the priorÂ defendantÂ was innocent of the alleged misconduct.
Close Situations. Â Some situations require a closer, fact based evaluation to decide whether the prior victory was favorable. Â For example, inÂ Zeavin v. LeeÂ (1982) 136 Cal.App.3d 766, 773, a case that ended due to terminating discovery sanctions, would not be deemed a “favorable” termination for purposes of a later malicious prosecution action against the prior plaintiff’s attorney. Â The prior plaintiff had not cooperated with discovery and that could not be attributed to the attorney. Â However, where the failure to respond to discovery results in terminating sanctions and appears to be an acknowledgement by prior plaintiff that prior claims lack merit, the courts will recognize such a termination as favorable. Â Ross v. KishÂ (2006) 145 Cal.App.4th 188, 201.
Substantive victories. Â A dismissal obtained by application of the parol evidence rule is considered substantive because it necessarily affects the merits of the prior action. Â Casa Herrera, Inc. v. BeydounÂ (2004) 32 Cal.4th 336, 345. Â AÂ dismissalÂ for failure to prosecute is, under most circumstances, substantive. Â Minasian v. SapseÂ (1978) 80 Cal.App.3d 823, 828. Â A prior action that terminates followingÂ judicialÂ arbitration is considered substantive. Â Stanley v. Superior CourtÂ (1982) 130 Cal.App.3d 460, 465. Â Note that a prior action that terminates in contractual arbitration is not substantive. Â Â Brennan v. Tremco Inc.Â (2001) 25 Cal.4th 310, 317.
This post is the second in a series of posts on the tort ofÂ malicious prosecution. Â Â Â Jeffrey LewisÂ represented the prevailing parties in the malicious prosecution case of Â Videotape Plus, Inc. v. LyonsÂ (2001)Â 89 Cal.App.4th 156.Â Â Â Jeffrey LewisÂ and the other attorneys atÂ Broedlow Lewis LLPÂ are experienced litigators and can advise you about your potential rights and defenses in a malicious prosecution action.Â Â Each case is different and you should consult a lawyer rather than relying on this post as legal advice for your situation.