Anti-SLAPP Motion Granted Dismissing Fraud and Misrepresentation Claims Against Restaurant Owner

In November 2024, Trepanier Tajima LLP successfully persuaded the judge to grant a motion under California Code of Civil Procedure, section 425.16, which is California’s statute regarding Strategic Lawsuits Against Public Participation (“SLAPP”). When a plaintiff files a lawsuit that targets the defendant’s right of petitioning the government or of free speech on a matter of public interest, the defendant may file what is called an Anti-SLAPP motion. This is a special motion to strike the claims, causes of action, and potentially allegations that target public participation rights protected by the SLAPP statute. In this case, Trepanier Tajima LLP identified that the complaint against a former commercial restaurant tenant for allegedly past due rent was based in large part upon the restaurant tenant’s application to the Small Business Administration (“SBA”) for an Economic Injury Disaster Loan (“EIDL”) during the COVID-19 pandemic. The landlord alleged that it was entitled to allegedly fraudulent EIDL loan proceeds. On behalf of the defendants, Trepanier Tajima LLP filed a SLAPP motion identifying the lawsuit’s EIDL loan allegations as targeting the restaurant tenant’s right to apply to the SBA, a government agency, for economic assistance. The Court found that the SLAPP statute applied and shifted the burden of proof to the plaintiff landlord to prove the fraud and misrepresentation allegations of its complaint with admissible evidence. The plaintiff offered no evidence or opposition to the SLAPP motion and the judge granted the motion, striking the offending claims. The judge granted leave for the prevailing defendant to file an application for attorneys’ fees and costs required to file the Anti-SLAPP motion.

In summary, the SLAPP statute and special motion to strike procedures are powerful tools that a defendant should consider when responding to a lawsuit. Often, the plaintiff is unaware that it has triggered the SLAPP statute, or the plaintiff is hoping that the defendant will not realize it is a SLAPP suit. The SLAPP procedures are designed to discourage plaintiffs from targeting protected public participation activities without having evidence to support their claims from the outset of the case. Anti-SLAPP motions are one way for a defendant to achieve evidence-based dismissals or rulings early on in the case, long before a costly trial is scheduled. The SLAPP statute also protects defendants from litigation early by staying discovery while an Anti-SLAPP motion is being considered. The SLAPP statute also awards attorneys’ fees to a successful defendant that proves it has been targeted by an unmeritorious SLAPP suit. Careful review of a complaint’s allegations are necessary to determine if the Anti-SLAPP procedure applies.