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June 29, 2015

Finton Construction, Inc. v. Bidna & Keys, APLC (2015) _ Cal.App.4th _ , 2015 WL 3947116

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The Fourth District applies the litigation privilege to dismiss a claim a law firm received stolen goods from its clients.

Bidna & Keys, APLC (“B & K”) represented Michael Reeves in a dispute between Reeves and his business partners, John Finton and Daniel Tontini. Reeves, Finton and Tontini owned Finton Construction, Inc. (“FCI”), a custom home builder in Southern California. Reeves sued Finton and Tontini for conspiring to reduce his ownership interest and terminate his involvement with FCI. FCI filed a cross-complaint against Reeves and several former FCI employees who formed a new company. FCI alleged that Reeves and the employees stole FCI’s clients and copied files from FCI’s computers.

When B&K refused to turn over the electronic files it acquired from its client, FCI’s counsel filed a theft report and a State Bar complaint. FCI unsuccessfully sought to disqualify B&K, and depose its attorneys. The trial court ordered the parties to copy and share the files for use in the litigation.

FCI filed an action against B & K alleging it converted the files and received stolen property. The trial court granted B & K’s C.C.P. §425.16 Anti-Strategic-Lawsuit-Against Public Participation (“anti-SLAPP”) motion.

The Court of Appeal noted that B & K’s acts were clearly protected “communicative conduct” arising out of the representation of its clients satisfying the first prong of an anti-SLAPP analysis. The court rejected FCI’s argument an exception applied because B & K’s conduct was illegal as a matter of law. This exception is extremely narrow and only applies where a defendant concedes illegality or the illegality is conclusively shown the evidence.

The Court found B & K was likely to prevail under the second prong of the analysis. The litigation privilege applied to B&K’s receipt and retention of the files.

Comment: Although this opinion does not break new ground, it was published so the Court could make a point about the lack of civility of FCI’s counsel. The Court had strong words about eradicating this type of egregious behavior. B&K’s only “crime” was to represent its clients in the underlying action.

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