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March 6, 2008

California Back Specialists Medical Group v. Rand (2008) 160 Cal.App.4th 1032

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The Second District holds that a lawsuit concerning an attorney’s failure to honor a lien for medical services is not subject to the anti-SLAPP statute.

Gary Rand represented Frank and Mona Beltran in two auto accident cases.  California Back Specialists Medical Group (CBSMG) treated the Beltrans in exchange for liens on their personal injury actions.  Rand disbursed the settlement proceeds without notifying CBSMG or satisfying the medical liens.  When CBSMG sued Rand for breach of contract, breach of fiduciary duty, conversion, money had and received, and unjust enrichment Rand sought to strike the complaint under California’s Anti-Strategic Lawsuit Against Public Participation (anti-SLAPP) statute.

Rand asserted that he had not signed the liens, that he believed the medical treatment was unnecessary, and that the treating physician was under investigation by the Medical Board, although it was in a matter unrelated to the Beltrans.

The Court of Appeal upheld the trial court decision that the lawsuit was not subject to the anti-SLAPP statute.  The analysis is a two-step process.  First a court decides if the challenged cause of action arises from protected activity.  If so, the court then decides if plaintiff has demonstrated a probability of prevailing.

A protected activity is one that arises out of a person’s right of petition or free speech under the United States or California Constitution in connection with a public issue.  The right to petition includes any written or oral statement or writing made in connection with an issue under consideration or review by a judicial body, or any other official proceeding authorized by law.  If the protected activity is only collateral or incidental to the purpose of the transaction, the statute does not apply.

CBSMG’s complaint did not involve protected activity because it was merely a dispute between private parties about the validity and satisfaction of the liens.  The fact there was an underlying lawsuit that was the source of the disputed funds did not render Rand’s actions protected.  Not all attorney conduct in connection with client representation is protected activity.  The court did not continue the analysis since it decided the complaint did not involve protected activity.

Comment: This is yet another example of a court not allowing an attorney to use the anti-SLAPP scheme as protection from basic contractual duties to third parties.


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