Three key questions to ask in evaluating any potential case for Malicious Prosecution

The complex tort of malicious prosecution is frequently threatened yet rarely fully understood.  The elements of the claim are that a prior action  (1) was commenced by or at the direction of the defendant and was pursued to a legal termination in his, plaintiff’s favor;  (2) was brought without probable cause: and (3) was initiated with malice.\” (Brennan v. Tremco Inc. (2001) 25 Cal.4th 310, 313).  In evaluating whether to accept or defend a malicious prosecution action, there are three critical questions to ask at the outset of the case:

1. What motions were filed in the prior action bearing on the merits?
2. What viable sources and parties are there to satisfy a judgment?
3. Is there sufficient evidence available to the parties now to survive an anti-SLAPP motion to strike within 90 days of filing the complaint?

1. What Motions Were Filed in the Prior Action Bearing on the Merits?

One way for a defendant to establish probable cause to file the prior action and avoid liability for malicious prosecution is to use a victorious motion in the prior action that bears on the merits.

For example:

• A prior plaintiff who withstands a defense motion for summary judgment is immune from malicious prosecution liability absent narrow exceptions (i.e., fraud).  (Videotape Plus, Inc. v. Lyons (2001) 89 Cal.App.4th 156, 161).
• A prior plaintiff who prevails on a motion for preliminary injunction is immune from malicious prosecution liability absent narrow exceptions (i.e., fraud).  (Fleishman v. Superior Court (2002) 102 Cal.App.4th 350, 357-58).

2. Are there Viable Sources to Satisfy a Judgment?

• The prior plaintiff’s attorney’s insurance policy is not a source to satisfy a judgment.  Although insurance companies may agree to defend their insureds against a malicious prosecution action, there is no duty to indemnify its insureds from such a judgment. Indeed any insurance policy that purports to do so is contrary to public policy and unenforceable.  (Downey Venture v. LMI Ins. Co. (1998) 66 Cal. App. 4th 478, 507-09).
• Malicious prosecution liability is not limited to parties and attorneys from prior action.  Persons who urge, procure or otherwise are actively instrumental in the filing of the lawsuit may be sued for malicious prosecution along with the actual prior plaintiff.  (Ludwig v. Superior Court (1995) 37 Cal.App.4th 8, 25 fn. 26).
• \”An attorney may be sued and held separately liable by a third party for malicious prosecution . . .\”  (Westamco Investment Co. v. Lee (1999) 69 Cal. App. 4th 481, 487-88).
• “Nor should an associated attorney whose name appears on all filings be able to avoid liability by intentionally failing to learn anything about a case that may turn out to have been maliciously prosecuted in whole or in part.”  (Cole v. Patricia A. Meyer & Associates, APC (2012) 206 Cal.App.4th 1095, 1117).
• Successor counsel may also be liable for malicious prosecution if they continued the prosecution without probable cause. (Zamos v. Stroud (2004) 32 Cal. 4th 958).
• A trustee may be sued for prior action brought in trustee’s representative capacity.  Trustee, not the trust, is the real party in interest with respect to litigation over trust property.  (Nicholson v. Fazeli (2003) 113 Cal.App.4th 1091, 1102-1103).

3. Ability to Withstand the Inevitable Anti-SLAPP Motion

• A defendant faced with a \”SLAPP\” may file a special motion to strike within 60 days of being served with the complaint.  The motion must be heard within 30 days from service of the motion.  (Code Civ. Proc., § 425.16, subd.(f).)
• A malicious prosecution action arising from the filing of a civil lawsuit falls within the ambit of the Anti-SLAPP statute.  (HMS Capital, Inc. v. Lawyers Title Co. (2004) 118 Cal.App.4th 204, 212-13).
• This shifts the burden of proof on the prior defendant to prove the merits of the malicious prosecution claim.
• The malicious prosecution plaintiff must \”demonstrate that the complaint is both legally sufficient and supported by a sufficient prima facie showing of facts to sustain a favorable judgment if the evidence is submitted by the plaintiff is credited.\”  (HMS Capital, Inc. v. Lawyers Title Co. (2004) 118 Cal. App. 4th 204, 212-13).
• Allegations alone insufficient.  Must have admissible evidence (i.e., declarations on personal knowledge and/or documents with all foundation established).  (HMS Capital, Inc. v. Lawyers Title Co. (2004) 118 Cal. App. 4th 204, 212).

This post is the first in a series of posts on the tort of malicious prosecution.    Jeffrey Lewis represented the prevailing parties in the malicious prosecution case of  Videotape Plus, Inc. v. Lyons (2001) 89 Cal.App.4th 156.   Jeffrey Lewis and the other attorneys at Broedlow Lewis LLP are experienced litigators and can advise you about your potential rights and defenses in a malicious prosecution action.  Each case is different and you should consult a lawyer rather than relying on this post as legal advice for your situation.