Navallier v. Sletten

In Navallier v. Sletten (2002) 29 Cal.4th 82, the plaintiffs had sued the defendant, an independent trustee of an investment fund, in federal court for breach of fiduciary duty. (Id. at pp. 85-86.) Thereafter, the parties signed an agreement that included a comprehensive release of liability (the release). (Id. at p. 86.) A short time later, the plaintiffs filed an amended complaint in federal court, against which the defendant counterclaimed for breach of contract, among other claims. (Ibid.) Eventually, the federal court dismissed two of the defendant's counterclaims based on the release, which limited the types of claims he could file in the federal action. (Id. at pp. 87, 90.) In addition, the plaintiffs prevailed on summary judgment with respect to some of the remaining counterclaims, the defendant partially prevailed on summary judgment with respect to the plaintiffs' claims, and the jury reached a defense verdict with respect to the plaintiff's remaining claims. (Id. at pp. 86-87.) Just before noticing an appeal in the federal action, the plaintiffs filed this state court action, alleging that the defendant had fraudulently misrepresented his intention to be bound by the release, thereby inducing them to incur litigation costs in the federal action that they otherwise would not have incurred. (Navallier v. Sletten, supra, 29 Cal.4th at p. 87.) The plaintiffs further alleged breach of contract based on the defendant's filing of the counterclaims in federal court. (Ibid.) The defendant moved to strike under section 425.16. (Ibid.) Concluding that the plaintiffs were complaining of wrongdoing in connection with the defendant's execution of the release, which limited the claims he was entitled to bring in federal court, the California Supreme Court held that the state lawsuit was subject to the anti-SLAPP statute. In doing so, the court explained as follows: "Defendant is being sued because of the affirmative counterclaims he filed in federal court. In fact, but for the federal lawsuit and defendant's alleged actions taken in connection with that litigation, plaintiffs' present claims would have no basis. This action therefore falls squarely within the ambit of the anti-SLAPP statute's 'arising from' prong." (Navallier v. Sletten, supra, 29 Cal.4th at p. 90.)