Simantob v. Akhtarzad CA2/8 ( 2024 )

Filed 10/1/24 Simantob v. Akhtarzad CA2/8
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IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
SECOND APPELLATE DISTRICT
DIVISION EIGHT
JACK SIMANTOB et al., B320753
Plaintiffs and Respondents, Los Angeles County
Super. Ct. No. 20STCV39690
v.
SINA AKHTARZAD et al.,
Defendants and Appellants.
APPEAL from an order of the Superior Court of Los
Angeles County. Michelle Williams Court, Judge. Affirmed.
Benedon & Serlin, Wendy S. Albers and Kelly Riordan
Horwitz for Defendants and Appellants.
Law Offices of Michael H. Rosenstein and Michael H.
Rosenstein for Defendant and Appellant Sina Akhtarzad.
Ian J. Singer, in pro. per., for Defendant and Appellant
Ian J. Singer.
Michael S. Drucker, in pro. per., for Defendant and
Appellant Michael S. Drucker.
Timothy D. McGonigle Prof. Corp. and Timothy D.
McGonigle; Greines, Martin, Stein & Richland, Robin Meadow,
and John J. Metzidis for Plaintiffs and Respondents.
_____________________________
SUMMARY
Plaintiffs Jack Simantob and the company he managed,
8451 Melrose Property, LLC (Melrose), sued Sina Akhtarzad and
his lawyers, Foley Bezek Behle & Curtis (Foley Bezek),
Michael S. Drucker and Ian J. Singer, for malicious prosecution
of lawsuits concerning a commercial lease. Foley Bezek filed a
special motion to strike the complaint under the anti-SLAPP
(strategic lawsuit against public participation) statute. (Code
Civ. Proc., § 425.16; further undesignated statutory references
are to the Code of Civil Procedure.) Messrs. Akhtarzad, Drucker
and Singer (collectively, defendants) filed joinders to the Foley
Bezek motion.
Foley Bezek settled with plaintiffs and was dismissed from
the case. The trial court denied the other defendants’ anti-
SLAPP motions, finding plaintiffs made a prima facie showing of
facts that, if credited, would sustain a judgment against
defendants for malicious prosecution.
We affirm the trial court’s order.
FACTS
1. Background Facts
The underlying litigation in this case began 15 years ago, in
June 2009. This is Mr. Akhtarzad’s third appeal. We recite the
background facts as we described them in our previous opinions,
without attribution.1
1 See 8451 Melrose Property, LLC v. Akhtarzad (May 28,
2020, B288963) [nonpub. opn.] [2020 Cal.App.Unpub. Lexis 3348;
2
In March 2008, Melrose and Mr. Akhtarzad entered into a
lease for a commercial retail property at 8451 Melrose Avenue.
The lease was for an 11-year term, with Mr. Akhtarzad to pay a
fixed minimum annual rent of $660,000, with annual increases
and other charges. The building had a front section for retail
space and a two-story rear section permitted to be used as a
warehouse. The lease stated Mr. Akhtarzad would use the
property as a selective, first-class retail development, and would
devote the entire premises to that use, “except for areas
reasonably required for office or storage space uses” for the
business conducted in the building. The lease anticipated
Mr. Akhtarzad would engage in construction or renovation at the
property.
In January 2009, rent for the property was due.
Mr. Akhtarzad told Mr. Simantob he could not pay the rent and
had no potential subtenants for the property. In February 2009,
Melrose’s attorney sent Mr. Akhtarzad a notice of abandonment.
Mr. Akhtarzad sent Melrose a check for $25,000, yet he owed
around $130,000. When Mr. Simantob asked Mr. Akhtarzad why
he had sent the $25,000 check, Mr. Akhtarzad responded it was
the last payment Melrose would receive, Melrose should not
expect more, and Mr. Simantob should lease the property to a
new tenant.
In March 2009, Mr. Simantob and Mr. Akhtarzad spoke
again. Mr. Akhtarzad said he could do nothing with the property,
and Melrose could have it back. Mr. Simantob made
arrangements with Mr. Akhtarzad to retrieve the key to the
property. Mr. Simantob found the property in disarray. The
8451 Melrose Property, LLC v. Akhtarzad (July 30, 2013,
B237052) [nonpub. opn.] [2013 Cal.App.Unpub. Lexis 5372].
3
building was stripped of everything, including fixtures. After
cleaning up debris, Melrose attempted to lease the property
again, but was unsuccessful.
On June 2, 2009, Melrose filed suit against Mr. Akhtarzad
for breach of contract. Two weeks later, Mr. Akhtarzad filed a
complaint against Mr. Simantob, alleging causes of action for
breach of the lease, fraud, restitution and an accounting. Six
months after that, in December 2009, Mr. Akhtarzad cross-
complained against Melrose, alleging the same causes of action
that he alleged against Mr. Simantob. In his answer to Melrose’s
first amended complaint, Mr. Akhtarzad asserted an affirmative
defense of fraud and misrepresentation. The two lawsuits were
consolidated.
2. Melrose’s Summary Judgment Motion
In July 2010, Melrose moved for summary judgment, or in
the alternative for summary adjudication, contending the
undisputed facts showed Mr. Akhtarzad breached the lease and
that his affirmative defenses and counterclaims were
unsupported in fact or law.
Mr. Akhtarzad’s opposition included his own declaration.
Among other points, he stated that in deciding to lease the
premises, he relied on Mr. Simantob’s representations “that the
entire area of the Premises was zoned for retail, that the
Premises contained approximately 10,000 square feet of rentable
area for retail space, and that no portion of the existing
structures had been added illegally.” Mr. Akhtarzad stated that
in early February 2009, “I was able to reach a partial agreement
with Jack Simantob to modify the Lease whereby the monthly
rent beginning January 2009 would be decreased to . . . $25,000[].
Pending my receipt from [Melrose] of a written amendment to
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memorialize our agreement to decrease the rent, the sum of
$25,000 was paid to [Melrose] for rent on February 12, 2009.” He
declared that since February 17, 2009, Melrose “has excluded me
from the Premises and has changed the locks thereby prohibiting
me from occupying or using the Premises.” And, “At no time on
or before February 17, 2009 did I ever voluntarily abandon or
vacate possession of the Premises nor have I ever notified or
informed [Melrose] or Jack Simantob of any intention to abandon
or vacate possession.” Mr. Akhtarzad also declared he had
suspended the tenant improvement work he was doing because of
his uncertainty about the legality of the structure.
The trial court (Judge Holly E. Kendig) found Melrose had
not properly noticed the motion for summary adjudication of
issues, and had not complied with the Code of Civil Procedure
with respect to summary adjudication issues. Judge Kendig
therefore treated Melrose’s motion as one for summary judgment.
The court denied the motion.
At the hearing, the court said, among other things, that
Melrose had failed to present admissible evidence in support of
some facts. “But really the biggest factor here is probably the
fact that I have a defendant who’s effectively disputed a whole
series of facts,” which the court enumerated. “In essence,
[Mr. Akhtarzad’s] opposition shows that there’s triable issues of
material fact with respect to elements of the breach of contract
and declaratory relief causes of action including whether or not a
valid agreement exists and also as the issue of damages for the
breach of contract claim. [¶] And [Mr. Akhtarzad’s] opposition
also reveals triable issues of fact exist with respect to
[Mr. Akhtarzad’s] defenses to the claims in the First Amended
Complaint.”
5
After entertaining arguments, the court stated: “So I don’t
see how we get close to this being done on summary judgment.
I understand you think that the facts are very strong in the
[Melrose’s] favor, and they may well be. [¶] But what we have, . .
. [Mr. Akhtarzad’s] opposition reveals triable issues with respect
to elements of the breach of contract. I mean, this whole issue of
abandonment back and forth is in dispute as to what was—what
exactly happened on that. And there’s disputed facts about that.
I can’t decide those here. They have to go before a trier of fact.”
Further, “[t]here’s issues about whether there’s a valid
agreement; there is issues on damages. And you’re trying to get
future damages . . . .”
3. The Ensuing Proceedings
The trial court conducted a bench trial in 2011 on the
consolidated actions. Near the conclusion of Melrose’s case,
Mr. Akhtarzad dismissed his trial counsel (defendants Drucker
and Singer) and began representing himself. In his own case,
Mr. Akhtarzad offered testimony from two defense witnesses and
examined Mr. Simantob. Mr. Akhtarzad did not testify.
The trial court (Judge Kendig) found in favor of Melrose on
all claims. In a statement of decision, the court concluded
Mr. Akhtarzad failed to present any credible evidence to support
any of his claims or defenses. It awarded Melrose more than
$8.1 million in damages.
Mr. Akhtarzad appealed. We reversed the judgment
because of a change in the law. Mr. Akhtarzad had been
prevented from introducing parol evidence to prove fraud as an
affirmative claim and as a defense to Melrose’s breach of contract
claim; a California Supreme Court decision, issued while the
6
appeal was pending, overruled long-standing precedent on the
issue.
4. Judge Thomas’s Findings
On remand, the parties stipulated to a second trial before a
referee (Ret. Judge Robert W. Thomas). Over the course of a 10-
day trial, Mr. Akhtarzad sought to establish the lease was illegal
and therefore unenforceable. He argued Mr. Simantob built the
second story to the warehouse portion of the premises sometime
after purchasing the property in 1991, causing the building to
exceed the maximum floor area permitted under the West
Hollywood Municipal Code. This, he argued, rendered the
building unlawful and prevented him from occupying it.
Mr. Akhtarzad also argued the lease illegally required him to use
the entire building for retail, which violated a restriction that the
back portion be used as a warehouse.
After hearing all the evidence, Judge Thomas issued a 139-
page statement of decision rejecting Mr. Akhtarzad’s illegality
defense and finding he breached the lease by failing to pay rent.
Judge Thomas concluded the lease was for a lawful purpose,
noting it was not illegal to use the building as retail. Further,
there was no evidence Mr. Akhtarzad was prevented from using
the building or obtaining necessary permits, and the City of West
Hollywood never deemed the building illegal or took any other
enforcement action. Judge Thomas further found the “mystery”
of when the warehouse's second story was built was “never
satisfactorily solved.”
Among other findings were these.
Mr. Akhtarzad’s testimony “was inconsistent and
controverted by other witnesses in numerous occasions and in
7
important areas. He also did not remember some important
events.”
Mr. Akhtarzad contended Mr. Simantob altered or doctored
a survey of the property “to conceal the illegality of the second
story to defraud Mr. Akhtarzad,” but “there was no evidentiary
support for that theory.”
Mr. Simantob testified he was offered $25,000 to terminate
the lease, and that Mr. Akhtarzad said that was the only money
he would get and if the lease was not terminated his lawyers
would engage in lengthy litigation and “crush” Mr. Simantob.
Judge Thomas found Mr. Simantob’s testimony credible, and
corroborated by another witness’s testimony that Mr. Akhtarzad
had also offered that witness $25,000 to terminate a lease and
told the witness he (Mr. Akhtarzad) wanted to cancel the
witness’s lease because the economy and rental market had
collapsed. Mr. Akhtarzad denied all this and said he sent an e-
mail to Mr. Simantob saying there were problems with the
building, but the e-mails in evidence did not support
Mr. Akhtarzad’s version.
“Mr. Akhtarzad also prepared a declaration stating that the
$25,000 he offered Mr. Simantob was for an agreed upon rent
modification. That claim is found to be completely unsupported.”
“If Mr. Akhtarzad was concerned about code violations or
other illegalities, it would seem he would be complaining about
them. There was no evidence of claims of illegalities until the
lawsuit.”
Mr. Akhtarzad said he released Vera Wang from his
sublease of the property to her “because he did not want to break
the law and get sued. There was no evidence presented to
support that claim.” William Mitchell, a representative of Vera
8
Wang, testified that Vera Wang decided not to go forward with
the 8451 Melrose Avenue lease and instead went back to another
Melrose Avenue location because of a change in business
direction. Mr. Mitchell testified “there were no usage or illegality
problems.” “There was no evidence presented that Vera Wang
would have had any problems with the 8451 Melrose Avenue
Premises with the warehouse in the back.”
Mr. Akhtarzad contended Mr. Simantob was “furious” that
Mr. Akhtarzad “landed Vera Wang instead of himself,” and
“plotted how to take the Vera Wang lease away from
Mr. Akhtarzad for his own profit” and “take it over for himself.
There was no evidence presented to support that theory in any
way.”
Craig Bailey, the PMQ (person most qualified) for the City
of West Hollywood, “testified that there was no reason to believe
there were any violations or code compliance issues with respect
to 8451 Melrose Avenue.” “The City of West Hollywood has never
deemed the building illegal or taken any action against it despite
being encouraged to do so by Mr. Akhtarzad.”
“There was never any evidence presented that
Mr. Akhtarzad was prevented from using the Premises as a
result of an[y] alleged illegalities or denied the opportunity to
obtain necessary permits.”
“Contrary to Mr. Akhtarzad’s claims, it is found the
credible evidence demonstrated that Mr. Akhtarzad’s reason for
attempting to terminate the Lease was due to the 2008 rental
market collapse and Mr. Akhtarzad’s financial problems.”
Judge Thomas concluded Melrose’s total damages were
more than $10.5 million. The trial court adopted Judge Thomas’s
9
statement of decision and entered judgment in favor of Melrose
and Mr. Simantob.
Mr. Akhtarzad again appealed. We affirmed the judgment,
rejecting Mr. Akhtarzad’s contention the lease was an illegal
contract and therefore unenforceable. We found Mr. Akhtarzad
did not prove the building was an unlawful structure and the
lease did not require him to use the building unlawfully.
5. This Lawsuit
On October 14, 2020, Melrose and Mr. Simantob filed this
action for malicious prosecution against Mr. Akhtarzad’s lawyers,
and in December 2020 added Mr. Akhtarzad as a defendant. As
explained at the outset, the Foley Bezek firm filed an anti-SLAPP
motion; Mr. Akhtarzad and two other lawyers, Mr. Drucker and
Mr. Singer, filed joinders to the Foley Bezek motion; Foley Bezek
settled with plaintiffs and was dismissed from the case. On
February 28, 2022, the trial court denied the other defendants’
anti-SLAPP motions.
After observing that the anti-SLAPP statute may be
invoked against claims of malicious prosecution, the court
addressed whether plaintiffs had made a prima facie showing of
facts necessary to sustain a favorable judgment. The court found
plaintiffs made the necessary showing that Mr. Akhtarzad’s
actions were brought without probable cause and with malice.
The trial court cited the following evidence.
Judge Kendig determined at the 2011 bench trial that
Mr. Akhtarzad discharged his attorneys midtrial, chose not to
testify, and “ ‘put on virtually no evidence at all to support his
claims.’ ”
The judgment after the 2011 bench trial was reversed, not
on the merits.
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After the second trial, Judge Thomas denied
Mr. Akhtarzad’s breach of contract claim, finding “ ‘[t]here was
never any evidence presented that Mr. Akhtarzad was prevented
from using the Premises as a result of an [sic] alleged illegalities
or denied the opportunity to obtain necessary permits.’ ”
Judge Thomas also found “[t]here was no credible evidence of
fraud, either: ‘[t]he credible evidence was that Mr. Akhtarzad
executed the Lease without relying on any representations or
statements by Mr. Simantob on behalf of [Melrose].’ ”
The trial court also found defendants withdrew their
argument that plaintiffs could not demonstrate malice.
As for defendants Drucker and Singer, the trial court
stated they were attorneys and counsel of record for
Mr. Akhtarzad in the underlying complaint and cross-complaint
against plaintiffs, and “[f]or the reasons stated above,” plaintiffs
carried their burden of producing evidence sufficient to sustain a
favorable judgment if the evidence were credited.
Defendants filed timely notices of appeal from the trial
court’s order.
DISCUSSION
A defendant may bring a special motion to strike any cause
of action “arising from any act of that person in furtherance of the
person’s right of petition or free speech under the United States
Constitution or the California Constitution in connection with a
public issue . . . .” (§ 425.16, subd. (b)(1).) When ruling on an
anti-SLAPP motion, the trial court employs a two-step process.
The moving defendant must establish the claims arise from
the defendant’s protected activity. If the defendant does so, “ ‘the
plaintiff must then demonstrate its claims have at least “minimal
merit.” ’ ” (Wilson v. Cable News Network, Inc. (2019) 7 Cal.5th
11871, 884.) “The court does not weigh evidence or resolve
conflicting factual claims. . . . It accepts the plaintiff’s evidence
as true, and evaluates the defendant’s showing only to determine
if it defeats the plaintiff’s claim as a matter of law.” (Baral v.
Schnitt (2016) 1 Cal.5th 376, 384-385.) “ ‘[C]laims with the
requisite minimal merit may proceed.’ ” (Id. at p. 385.)
Our review is de novo. (Soukup v. Law Offices of Herbert
Hafif (2006) 39 Cal.4th 260, 269, fn. 3 (Soukup).)
A malicious prosecution case arises from protected activity,
so our only task is to determine whether plaintiffs produced
sufficient evidence to sustain a favorable judgment if their
evidence is believed.
The malicious prosecution tort “consists of three elements.
The underlying action must have been: (i) initiated or
maintained by, or at the direction of, the defendant, and pursued
to a legal termination in favor of the malicious prosecution
plaintiff; (ii) initiated or maintained without probable cause; and
(iii) initiated or maintained with malice.” (Parrish v. Latham &
Watkins (2017) 3 Cal.5th 767, 775 (Parrish).)
The favorable termination element is not at issue.
Defendants contend plaintiffs cannot establish defendants
initiated or maintained Mr. Akhtarzad’s complaint against
Mr. Simantob and his cross-complaint against Melrose without
probable cause, and cannot establish they acted with malice
either. They also contend Mr. Simantob’s malicious prosecution
claim is barred by the statute of limitations. We disagree with all
these contentions.
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1. Probable Cause
a. The law
“ ‘[T]he probable cause element calls on the trial court to
make an objective determination of the “reasonableness” of the
defendant’s conduct, i.e., to determine whether, on the basis of
the facts known to the defendant, the institution of the prior
action was legally tenable,’ as opposed to whether the litigant
subjectively believed the claim was tenable. [Citation.] A claim
is unsupported by probable cause only if ‘ “ ‘any reasonable
attorney would agree [that it is] totally and completely without
merit.’ ” ’ [Citations.] ‘This rather lenient standard for bringing
a civil action reflects “the important public policy of avoiding the
chilling of novel or debatable legal claims.” ’ [Citation.] The
standard safeguards the right of both attorneys and their clients
‘ “ ‘to present issues that are arguably correct, even if it is
extremely unlikely that they will win.’ ” ’ ” (Parrish, supra,
3 Cal.5th at p. 776.)
“ ‘A litigant will lack probable cause for his action either if
he relies upon facts which he has no reasonable cause to believe
to be true, or if he seeks recovery upon a legal theory which is
untenable under the facts known to him.’ ” (Soukup, supra,39 Cal.4th at p. 292.) As Parrish tells us, “ ‘When there is a
dispute as to the state of the defendant’s knowledge and the
existence of probable cause turns on resolution of that dispute,
. . . the jury must resolve the threshold question of the
defendant’s factual knowledge or belief.’ ” (Parrish, supra,
3 Cal.5th at p. 781, fn. 4.)
We accept as true the plaintiffs’ evidence about what
defendants knew, and “through that lens, evaluat[e] whether the
13
[defendants’] claim(s) were legally and factually tenable.”
(Gruber v. Gruber (2020) 48 Cal.App.5th 529, 532.)
b. Contentions and conclusions
We begin with this observation. This case does not concern
a “ ‘ “novel or debatable legal claim[].” ’ ” (Parrish, supra,3 Cal.5th at p. 776.) The existence of probable cause is “purely a
legal question” when “there is no dispute as to the facts upon
which an attorney acted in filing the prior action.” (Sheldon
Appel Co. v. Albert & Oliker (1989) 47 Cal.3d 863, 868 (Sheldon
Appel).) This is a case where there is a dispute as to the facts
known to defendants when they filed Mr. Akhtarzad’s complaint
and cross-complaint. And if a jury decides that Mr. Akhtarzad
and his lawyers knew he did not rely on any representations from
Mr. Simantob when he signed the lease, and that he made other
claims with no basis in fact, then defendants had no probable
cause to bring Mr. Akhtarzad’s complaint and cross-complaint.
Judge Thomas made findings pertinent to those issues.
We will not repeat all the details of Judge Thomas’s
findings on the relevant issues (see pp. 7-9, ante), but they are
worth bearing in mind. By way of example, Judge Thomas
concluded Mr. Akhtarzad did not rely on any representations
from Mr. Simantob when he signed the lease; he tried to
terminate it because of his financial problems, not for the reasons
he gave; there was no evidence Mr. Akhtarzad made any claims
of illegalities until after Melrose filed its lawsuit; there was no
basis for Mr. Akhtarzad’s declaration that the $25,000 he offered
to Mr. Simantob was for an agreed-upon rent modification; and
there was no evidence for his contention he did not abandon the
property.
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Judge Thomas’s findings are prima facie evidence that
Mr. Akhtarzad was relying on facts he had “no reasonable cause
to believe to be true” (Soukup, supra, 39 Cal.4th at p. 292) when
he brought his affirmative claims against plaintiffs. If that
evidence is credited by the factfinder, it would establish lack of
probable cause. As plaintiffs say, there can be no probable cause
when a party knows the factual allegations on which his claims
depend are false.
Defendants resist this conclusion on several grounds. They
point to the evidence Mr. Akhtarzad submitted to prove his
claims that the second story on the property was constructed in
1994 and violated City of West Hollywood zoning ordinances on
floor area ratios—“a fact that supported Akhtarzad’s claims that
plaintiffs hid the unpermitted expansion of the premises to entice
him into the lease.” Defendants miss the point. The fact of a
zoning violation does not “provide[] ample probable cause for
Akhtarzad to believe and assert that Simantob fraudulently
induced him to enter the lease.” It is the state of Mr. Akhtarzad’s
knowledge and the reasons he gave for his actions that are at
issue.
Defendants primarily rely on an argument based on a
doctrine that does not apply to these circumstances. They
contend that Judge Kendig’s denial of Melrose’s motion for
summary judgment in 2010 “conclusively established” probable
cause “as a matter of law.” They base this contention on the
“interim adverse judgment” rule—the rule that “ ‘a trial court
judgment or verdict in favor of the plaintiff . . . in the underlying
case, unless obtained by means of fraud or perjury, establishes
probable cause to bring the underlying action, even though the
judgment or verdict is overturned on appeal or by later ruling of
15
the trial court.’ ” (Parrish, supra, 3 Cal.5th at p. 776.) The
rationale is that “if a claim succeeds at a hearing on the merits,
then, unless that success has been procured by certain improper
means, the claim cannot be ‘totally and completely without
merit.’ ” (Ibid.) Courts have also applied the rule to the denial of
defense summary judgment motions and similar defense efforts
to terminate the underlying case before trial. (Parrish, at
pp. 776-777, citing cases; see also Roberts v. Sentry Life Insurance
(1999) 76 Cal.App.4th 375, 384 [“denial of defendant’s summary
judgment in an earlier case normally establishes there was
probable cause to sue”].)
Of course, Melrose’s 2010 summary judgment motion was
far from a “normal” defense summary judgment motion. It was
principally plaintiff Melrose’s motion for summary judgment on
its own breach of contract claim, which would have been denied
in any event because of issues on damages as well as other
elements. (See pp. 5-6, ante.) The fact that Judge Kendig
concluded there were disputed fact issues based on
Mr. Akhtarzad’s statements—for which the court later found
there was no credible evidence—shows this is clearly not the
species of “interim adverse judgment” to which the rule
“normally” applies. This is exactly the sort of circumstance under
which a summary judgment ruling does not establish probable
cause as a matter of law.
Defendants also contend that plaintiffs cannot rely on
Judge Thomas’s findings to establish a lack of probable cause for
Mr. Akhtarzad’s claims. We disagree. Those findings show, at a
minimum, that a factfinder in the malicious prosecution case
could reach the same conclusions.
16
Plaintiffs, on the other hand, argue at length that Judge
Thomas’s findings are entitled to preclusive (collateral estoppel)
effect. For this they cite Key v. Tyler (2019) 34 Cal.App.5th 505,
and defendants counter that Plumley v. Mockett (2008)
164 Cal.App.4th 1031 supports the opposite view and also
supports their claim that the findings are not evidence of lack of
probable cause.
We agree with Key to the extent it held that a probate
court’s findings “concerning [the defendant’s] undue influence,
which this court affirmed, provide a sufficient basis to conclude
that [the plaintiff] has shown a probability of success” on her no-
contest petition; Key thus reversed the lower court’s grant of the
defendant’s anti-SLAPP motion. (Key, supra, 34 Cal.App.5th at
p. 510.) Key’s further discussion of the collateral estoppel effect of
the probate court’s findings was, in our view, unnecessary. And
Plumley, which held the trial court should have granted an anti-
SLAPP motion, does not help defendants. In Plumley, the court
rejected the claim that certain state court findings (that the
defendant’s story “ ‘was completely and utterly false’ ”) were
prima facie evidence of lack of probable cause to bring a federal
patent interference claim. (Plumley, supra, 164 Cal.App.4th at
pp. 1048, 1051.) However, the court reached that conclusion
because the fraud at issue had been presented to and rejected by
the trier of fact (the federal Board of Patent Appeals) in its initial
(later reversed) interference decision. (Id. at p. 1052.) That is
not the situation here.
In any event, there is no need here to give “preclusive
effect” to Judge Thomas’s findings about Mr. Akhtarzad’s
knowledge and motives in order to conclude, as we have, that
plaintiffs’ evidence, if credited by the factfinder, would establish
17
he lacked probable cause to bring his affirmative claims against
plaintiffs. It may be that Judge Thomas’s findings will have
preclusive effect in deciding the merits of the malicious
prosecution claim, but we need not decide that question in order
to resolve this appeal.
To reiterate the point: Judge Thomas’s findings show that
a factfinder in the malicious prosecution action could conclude (as
Judge Thomas did) that there was no evidence Mr. Akhtarzad
was prevented from using the premises as a result of any alleged
illegalities; and no evidence supporting Mr. Akhtarzad’s claim
that he executed the lease in reliance on misrepresentations by
Mr. Simantob. If those points are accepted as true in the
malicious prosecution action, they would establish that
Mr. Akhtarzad had no probable cause to bring the lawsuit
because he knew his claims—that Melrose/Simantob breached
the contract by excluding him from the premises and made
misrepresentations he relied on when he signed the lease—were
false.
There is one other point. Defendants contend our 2013
decision remanding the case for a new trial was also an interim
adverse ruling that “conclusively established” probable cause.
That contention is entirely without merit. The court reversed
because Mr. Akhtarzad had been prevented from submitting any
evidence of fraudulent misrepresentations that conflicted with
the terms of the lease, and a subsequent change in the law made
that exclusion erroneous. The decision was not adverse in the
sense of finding a lack of substantial evidence to support the
judgment.
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2. Malice
a. The law
The malice element of a malicious prosecution claim
“ ‘relates to the subjective intent or purpose with which the
defendant acted in initiating the prior action. . . . The plaintiff
must plead and prove actual ill will or some improper ulterior
motive.’ ” (Soukup, supra, 39 Cal.4th at p. 292.)
“[A] lack of probable cause, standing alone, does not
support an inference of malice,” but “malice may still be inferred
when a party knowingly brings an action without probable
cause.” (Swat-Fame, Inc. v. Goldstein (2002) 101 Cal.App.4th
613, 634 (Swat-Fame).)2 “[A] corollary to this rule can be stated
as follows: malice can be inferred when a party continues to
prosecute an action after becoming aware that the action lacks
probable cause.” (Daniels v. Robbins (2010) 182 Cal.App.4th 204,
226 (Daniels).)
An attorney’s liability depends on his own improper motive;
the client’s malice cannot be imputed to his attorneys. (Daniels,
supra, 182 Cal.App.4th at p. 225.) “While ‘the attorney is entitled
to rely on information provided by the client’ [citation], once the
lawyer discovers the client’s statements are false, the lawyer
cannot rely on such statements in prosecuting an action.”
(Golden State Seafood, Inc. v. Schloss (2020) 53 Cal.App.5th 21,
36-37.)
b. Background facts
Defendant Drucker signed and filed Mr. Akhtarzad’s
verified complaint against Mr. Simantob and his cross-complaint
2 Swat-Fame was disapproved on other grounds in Zamos v.
Stroud (2004) 32 Cal.4th 958, 973, and Reid v. Google, Inc. (2010)
50 Cal.4th 512, 532, footnote 7.
19
against Melrose, and had represented Mr. Akhtarzad as early as
1992. Defendant Singer associated as Mr. Drucker’s cocounsel in
June 2010; they prepared Mr. Akhtarzad’s opposition to the 2010
summary judgment motion; and they represented him at the
2011 bench trial until he discharged them midtrial.
Mr. Drucker continued to represent Mr. Akhtarzad in
another case in 2011 (the Bolduc case) involving similar claims
against Mr. Akhtarzad; that trial resulted in a jury verdict
finding Mr. Akhtarzad had interfered with the performance of a
lease, causing damages to the landlord of $8.9 million, and
awarding punitive damages of $1 million.
Mr. Akhtarzad rehired both Mr. Drucker and Mr. Singer
after our 2013 reversal of the judgment in the first trial. They
continued to prosecute this litigation until the Foley Bezek firm
took over in June 2016.
As previously mentioned, Foley Bezek filed the anti-SLAPP
motion, and Mr. Akhtarzad and attorneys Drucker and Singer
filed joinders in the motion. Plaintiffs sought relief from the
automatic discovery stay, and Foley Bezek then (May 4, 2021), in
its opposition brief, withdrew its argument that plaintiffs could
not show malice. Foley Bezek did so in order to avoid the
“burdensome discovery” plaintiffs sought that would create
“mammoth privilege and work-product issues.” Its opposition
brief stated: “Foley Bezek will not pursue, in its anti-SLAPP
motion, its secondary argument that Plaintiffs cannot
demonstrate malice. Once that issue is off the table, no other
issue of ‘state of mind’ nor any other issue requiring discovery
remains.”
Mr. Akhtarzad filed a notice of joinder in Foley Bezek’s
opposition to plaintiffs’ motion for relief from the discovery stay,
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incorporating by reference “the facts, law, and arguments set
forth in” Foley Bezek’s opposition brief.
Foley Bezek eventually settled with plaintiffs, and on
December 6, 2021, was dismissed from the case. On
December 30, 2021, plaintiffs filed their opposition to the joinders
of the three remaining defendants. Among other points,
plaintiffs stated that Foley Bezek, the moving party, expressly
withdrew the malice basis of its anti-SLAPP motion.
On January 6, 2022, the three defendants filed their
replies. Mr. Akhtarzad made no argument on malice. Neither
did Mr. Drucker. Mr. Singer described the malice standard, and
argued plaintiffs’ evidence the defendants lacked probable cause
and acted with malice “is all inadmissible.” None of the three
defendants mentioned plaintiffs’ statement about Foley Bezek’s
withdrawal of the malice claim.
The trial court concluded that all three defendants
withdrew their argument that plaintiffs could not show malice.
c. Contentions and conclusions
We conclude Foley Bezek and Mr. Akhtarzad withdrew any
contention that plaintiffs lacked evidence of malice.
Mr. Akhtarzad’s express joinder in and adoption of Foley Bezek’s
arguments in its opposition brief make that plain.
We further conclude Mr. Drucker and Mr. Singer forfeited
any contention plaintiffs lacked evidence of malice by not
developing facts and argument on malice after Foley Bezek and
Mr. Akhtarzad withdrew the argument. In any event, however,
there is sufficient evidence of malice.
Defendants insist that plaintiffs “presented no legal
argument or admissible evidence that [they] acted with malice.”
For this, they cite only plaintiffs’ opposition memorandum,
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without explanation. The opposition memorandum, filed after
Foley Bezek was dismissed from the case, argues that
Mr. Drucker and Mr. Singer chose to go back to representing
Mr. Akhtarzad in the continued prosecution of his claims, even
after he discharged them in the middle of the first trial, did not
testify, and put on virtually no evidence to support his claims.
The memorandum cites a January 2015 letter from Mr. Singer to
a City of West Hollywood official, asking him to “clarify” multiple
issues of claimed illegalities in the Melrose property, yet the City
of West Hollywood never deemed the building illegal or took any
action against it. As described above, Mr. Drucker also
represented Mr. Akhtarzad in another similar case in 2011 where
the jury assessed punitive damages against Mr. Akhtarzad.
The evidence of malice with respect to the complaint for
breach of the lease against Mr. Simantob is clear. Defendants
stated in Mr. Akhtarzad’s summary judgment opposition in 2010
that Mr. Simantob executed the lease in his capacity as manager
of Melrose, so they knew he was not a party to the lease. When
they were rehired in 2013, they must have known of Judge
Kendig’s finding at the first trial in 2011 that there was no
evidence Mr. Simantob was ever acting in his individual capacity,
but rather solely as Melrose’s manager. There is thus prima facie
evidence they knew by this time that the breach of lease claim
against Mr. Simantob was not objectively tenable. Yet they
continued to prosecute the case. (In February 2017, Foley Bezek
(who took over in 2016), dismissed Mr. Akhtarzad’s causes of
action against Mr. Simantob for breach of the lease and an
accounting.)
With respect to Mr. Akhtarzad’s claims of fraud and his
claim of breach of lease against Melrose, plaintiffs contend that
22
there is prima facie evidence Mr. Drucker and Mr. Singer “may
have known that the factual allegations on which [their] action
depended were untrue” (Sheldon Appel, supra, 47 Cal.3d at
p. 881), and that this is enough “to clear step two’s minimal
merits hurdle.” Plaintiffs cite the fact that Mr. Drucker had
Mr. Akhtarzad verify the complaint against Mr. Simantob, and
that he several times added “(As to Objections Only)” to
Mr. Akhtarzad’s verified interrogatory responses. Plaintiffs
argue Mr. Akhtarzad’s unwillingness to testify under oath at the
first trial was a “red flag,” as was the verdict in the 2011 Bolduc
trial, and all of this should have given Mr. Drucker and
Mr. Singer “grave concern” before Mr. Akhtarzad rehired them in
2013.
Malice is a question of fact. We agree with plaintiffs that a
jury could reasonably infer from the evidence described above
that Mr. Drucker and Mr. Singer knew their client was not
telling the truth about fundamental allegations supporting his
claims, yet continued to prosecute the claims through June 2016.
Defendants contend plaintiffs cannot rely solely on their
arguments about lack of probable cause to establish malice. To
this we can only repeat: While lack of probable cause alone does
not support an inference of malice, “malice may still be inferred
when a party knowingly brings an action without probable cause”
(Swat-Fame, supra, 101 Cal.App.4th at p. 634), and “malice can
be inferred when a party continues to prosecute an action after
becoming aware that the action lacks probable cause” (Daniels,
supra, 182 Cal.App.4th at p. 226).
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3. The Statute of Limitations
Defendants argue that the statute of limitations bars
Mr. Simantob’s (not Melrose’s) malicious prosecution claim. The
contention is meritless.
The statute of limitations is one year for Mr. Simantob’s
claim against the lawyers and two years for his claim against
Mr. Akhtarzad. (See, e.g., Vafi v. McCloskey (2011) 193
Cal.App.4th 874, 880; see also Code Civ. Proc., § 340.6.)
Mr. Simantob’s malicious prosecution action was timely under
either statute.
The statute begins to run on a malicious prosecution action
on the date the underlying action is terminated in favor of the
plaintiff. But the time for filing the action is tolled while the
underlying judgment is on appeal. (Gibbs v. Haight, Dickson,
Brown & Bonesteel (1986) 183 Cal.App.3d 716, 722.)
Here, the judgment after the second trial was entered on
June 14, 2018. Mr. Akhtarzad appealed from the judgment on
July 11, 2018, tolling the statute from that date until the appeal
process was exhausted, in this case upon issuance of our
remittitur on September 10, 2020. (Case No. B288963.)
Mr. Simantob and Melrose filed their malicious prosecution
claims against the lawyers on October 14, 2020, and their first
amended complaint including Mr. Akhtarzad as a defendant on
December 24, 2020. The statute of limitations ran for 27 days
before it was tolled by the appeal, and began to run again on
September 10, 2020. Thus the statute ran for only a few months
before Mr. Simantob and Melrose filed their malicious
prosecution claims.
Defendants argue, however, that Mr. Akhtarzad “appealed
only the judgment entered on behalf of Melrose,” so that
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Mr. Simantob “cannot claim the benefit of this tolling.”
Defendants are mistaken.
Mr. Akhtarzad’s notice of appeal in the underlying case
states only that he appeals from the June 14, 2018 judgment.
(We grant plaintiffs’ request for judicial notice of the notice of
appeal as a court record.) Nonetheless, Mr. Akhtarzad claims
that Mr. Simantob was not a party to the appeal because
Mr. Akhtarzad identified only Melrose in his July 30, 2018 civil
case information statement (CCIS) when asked to list all the
parties who would participate in the appeal. He contends the
CCIS and his opening brief in the underlying appeal confirm that
he appealed only the judgment in favor of Melrose, and “only
Melrose was identified as a respondent in the Court of Appeal’s
opinion.”
We reject this claim. It is true that Mr. Akhtarzad did not
challenge the judgment in favor of Mr. Simantob on
Mr. Akhtarzad’s fraud claims (which were the same as his fraud
claims against Melrose). But his opening brief in the underlying
case (heading II) stated the trial court erred “in entering
judgment for Melrose and Simantob” because the lease was
illegal and unenforceable. At page 35 of his opening brief, he
similarly contended that the trial court “erred in entering
judgment for Melrose and Simantob based on the illegal Lease.
Judgment must be reversed.”
Moreover, the judgment provided that Mr. Simantob was
entitled to recover legal fees and costs, and ordered that he and
Melrose were jointly and severally entitled to fees and costs of
$1,322,321.52. In his opening brief in the underlying case,
Mr. Akhtarzad specifically sought reversal of Mr. Simantob’s fee
award, stating that “[a]lthough Simantob is not expressly listed
25
as a party to the appeal, this is not an impediment to reversing
his award of fees and costs.”
Further, the respondents’ brief in the underlying case was
filed on behalf of both Melrose and Mr. Simantob, and argued
that the judgment for Mr. Simantob, including the fee award,
should be affirmed in full.
Mr. Akhtarzad insists that appellate courts “routinely look
to the [CCIS] and the parties’ briefing” to determine the parties
to an appeal, and cites four cases that mention a CCIS for one
reason or another. None of the cases suggests that a party not
listed in the CCIS is therefore not a party to the appeal, and they
are all factually inapt. There is no authority for concluding the
statute of limitations continued to run against Mr. Simantob just
because Mr. Akhtarzad did not name him in the CCIS.
Mr. Simantob was entitled to and did file a respondent’s brief.
Mr. Akhtarzad’s statements in his opening brief, and particularly
his claim that Mr. Simantob’s attorney fee award should be
reversed, definitively refute his claim.
DISPOSITION
The trial court’s order denying defendants’ anti-SLAPP
motions is affirmed. Respondents are entitled to recover costs on
appeal.
GRIMES, J.
WE CONCUR:
STRATTON, P. J. WILEY, J.
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