Northern California Record

Tuesday, November 12, 2019

Appeals court affirms anti-SLAPP motion denial in Area 51's lawsuit against Alameda

By Karen Kidd | Mar 1, 2018

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SAN FRANCISCO — A state appeals court recently affirmed a lower court's denial of an anti-SLAPP (strategic lawsuits against public participation) motion in event planning company Area 51's lawsuit against the City of Alameda and others over alleged breach of contract.

California First District Court of Appeal, Division Four, unanimously affirmed the Alameda County Superior Court's order in five of Area 51's six causes of action against the city and other defendant, according to the 28-page opinion issued Feb. 20. 

"In all other respects, the court's order denying the motion is reversed, and the case is remanded for consideration of attorney fees and costs awardable as set forth above," the opinion said.

Area 51's six causes of action arose from activity protected "in part, or entirely" by California's anti-SLAPP  statute but five of those six causes stood apart, the opinion said. 

"Because we conclude that the first though fifth causes of action do not involve protected speech or actions by the City, we do not reach the second prong of the anti-SLAPP analysis of whether Area 51 can show a probability of prevailing on those claims as pleaded against it alone," the opinion said.

Justice Jon B. Streeter wrote the opinion for the court while Justices Ignazio J. Ruvolo and Maria P. Rivera concurred.

Area 51 "had a long-standing relationship with the city of Alameda" for events on city property and "helped plan and promote with third-party companies" while the city also relied on PM Realty Group to assist with license arrangements, the opinion said.

"Due to various problems at or in connection with events put on by Area 51, the city decided to cease doing business with it in mid-2014," the opinion said. "Because that left Area 51 on the hook to a number of third-party entities based on commitments undertaken in reliance on PM's previous confirmation of the city's willingness to license event space, Area 51 sued the city and various other parties who acted on the city's behalf, seeking damages."

In addition to the city and PM, Area 51 also named as defendants in its lawsuit Alameda City Manager John Russo; Acting Assistant Community Development Director Nanette Banks Mocanu; and PM employees Stacey McCarthy, Tiffany McClendon and Maria Elgarico.

Area 51 asserted "six causes of action" against the defendant, according to the opinion. These were breach of contract, tortious interference with Area 51's third-party contracts, intentional and negligent interference with prospective economic relations, unfair competition and negligent misrepresentation, according to the opinion.

"The city and the individual city defendants timely moved to strike all six causes of action under the anti-SLAPP statute, and the PM defendants joined the motion," the opinion said. "Area 51 opposed it, submitting the declaration of its Chief Executive Officer John Walker as the sole evidentiary showing in support of its claims."

Defendants filed a general demurrer and a motion to strike all causes of action under the state's anti-SLAPP statute, according to the opinion. The trial court granted the demurrer and denied the motion, which the defendants appealed, "arguing that all of Area 51's claims arise from protected activity and are without merit," the opinion said.

In five of its six causes of action, Area 51 sought to hold the city of Alameda legally accountable for the alleged breach of contract and the trial court "was correct to conclude that they do not arise from protected activity," the opinion said.

The appeals court's analysis of Area 51's sixth cause of action, negligent misrepresentation, "is more straightforward than it is for the first five because this claim is based purely on expressive conduct," the opinion said.

In that cause of action, Area 51 alleged the defendants negligently misrepresented that their confirmed reservations of a property in dispute "would be honored" but the appeals court concluded "that the alleged misrepresentations on which the sixth cause of action is based constitute anti-SLAPP protected activity", the opinion said.

It was not enough for Area 51 to replead its case after the superior court sustained the demurrer, the appeals court opinion said. 

"To survive defendants' motion, the burden was on Area 51 to come forward with admissible evidence showing a probability of prevailing on each claim exposed to step two anti-SLAPP analysis, enough to make out a viable prima facie case at trial," the opinion said.

"That burden was not particularly high but we conclude Area 51 failed to meet it."

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Organizations in this Story

Area 51First District Court of Appeal CaliforniaPM Realty GroupCity of Alameda