Castleman v. Sagaser CA5

216 Cal. App. 4th 481, 156 Cal. Rptr. 3d 492, 2013 Cal. App. LEXIS 391
CourtCalifornia Court of Appeal
DecidedApril 15, 2013
DocketF064590
StatusUnpublished
Cited by81 cases

This text of 216 Cal. App. 4th 481 (Castleman v. Sagaser CA5) is published on Counsel Stack Legal Research, covering California Court of Appeal primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Castleman v. Sagaser CA5, 216 Cal. App. 4th 481, 156 Cal. Rptr. 3d 492, 2013 Cal. App. LEXIS 391 (Cal. Ct. App. 2013).

Opinion

Opinion

GOMES, J.

This is an appeal from the denial of a special motion to strike under Code of Civil Procedure section 425.16, commonly known as the “anti-SLAPP statute.” 1 The motion was filed by appellant Howard A. Sagaser as to claims for breach of fiduciary duty, breach of the duty of loyalty, conversion, and invasion of privacy asserted against him by respondents Peter M. Castleman, Central California Development Group, LLC, Selma Crossings, LLC, and Merced Gateway, LLC. The trial court concluded that the anti-SLAPP statute was not applicable to respondents’ causes of action because the claims did not arise from constitutionally protected speech or petitioning activity, but rather from the alleged breach of an attorney’s professional and ethical duties owed to former clients. We affirm the trial court’s ruling.

FACTUAL AND PROCEDURAL BACKGROUND

Howard Sagaser is a licensed attorney and cofounder of the Fresno law firm previously known as Sagaser, Jones & Helsley (the Law Firm). 2 He and Attorney Timothy Jones were longtime shareholders and officers of the Law Firm. In October 2009, Sagaser resigned from the Law Firm under what respondents describe as acrimonious terms stemming from an internal dispute between Sagaser and his law partners, Jones in particular. The underlying details of that dispute are not relevant to this appeal.

Sagaser’s resignation became effective October 29, 2009. On Saturday, October 24, 2009, Sagaser remotely accessed the Law Firm’s document *486 management system from his home computer and spent several hours reviewing materials pertaining to two groups of clients. Respondents comprised one group, while the other consisted of James Bratton and Bratton Investments, LLC (collectively Bratton).

James Bratton and his affiliated entities had been clients of the Law Firm for several years. Timothy Jones served as counsel for Bratton and related entities in various real estate transactions, while Sagaser provided representation in labor and employment matters. Respondent Peter Castleman had been a client of the Law Firm since approximately 2003.

Many of the documents reviewed by Sagaser pertained to real estate transactions between the clients in 2007. Bratton had previously held ownership interests in undeveloped parcels of land located in the Counties of Fresno and Merced. Through a series of transactions structured and facilitated by Timothy Jones, who served as counsel for the interested parties, Bratton entered into business ventures with Peter Castleman, Castleman’s affiliated business entities, and others to develop these properties.

Respondent Selma Crossings, LLC, was formed to acquire, hold and develop real property previously owned by Bratton in Fresno County pursuant to the aforementioned business ventures. Respondent Merced Gateway, LLC, similarly acquired interests in the Merced County property. The role of respondent Central California Development Group, LLC, is not entirely clear from the record, though respondents indicate it had a managerial function with regard to the projects in Merced County. All three entities became clients of the Law Firm in 2007.

Disclosure letters and waivers were provided to, and signed by, Bratton and Peter Castleman regarding potential conflicts of interest of Jones and the Law Firm in relation to the real estate development projects. The parties allegedly gave Jones a percentage ownership interest in the subject properties and business ventures as compensation for his services, including his managerial role in several of the participating entities. In 2008, Bratton reportedly sold its interest in the Merced County property and development project for $2 million to one or more entities directly or indirectly owned by Castleman and/or Jones and others.

Soon after his October 24, 2009 review of materials on the Law Firm’s computer system, Sagaser contacted Attorney C. Russell Georgeson of the law firm Georgeson & Belardinelli. Sagaser also communicated with James Bratton. On more than one occasion, meetings were held between Mr. Georgeson, Mr. Bratton and Sagaser at Mr. Georgeson’s law office.

On March 25, 2010, Attorney Georgeson filed a complaint on behalf of Bratton against respondents, the Law Firm, Jones individually, and other *487 defendants, which asserted multiple claims related to the 2007 transactions and business ventures. The lawsuit, Bratton v. Jones, 3 was filed in Mariposa County and later transferred to Fresno County. Among other allegations, Bratton claimed respondents, Jones, and others conspired to and succeeded in defrauding it of its ownership interests in the Merced County property and development project, and induced Bratton to sell its stake for significantly less than fair market value (i.e., for $2 million rather than the alleged value of $5 million). Bratton purportedly discovered the facts and circumstances surrounding defendants’ alleged misconduct in October 2009.

Sagaser served a written demand for arbitration on Jones and the Law Firm in October 2010, which was later amended in August 2011. The demand alleged that unbeknownst to Sagaser, Jones obtained a 20 percent ownership interest in the 2007 business ventures between Bratton and respondents, which Jones later pledged as security for a nonrecourse loan to him and his wife in the amount of $9 million. According to Sagaser, the 20 percent fee and all related proceeds should have gone to the Law Firm rather than to Jones personally, meaning Sagaser would be entitled to millions of dollars pursuant to his shareholder interest in the Law Firm at that time.

Within weeks of serving his initial arbitration demand, Sagaser was subpoenaed to testify in Bratton v. Jones. He was deposed on November 15, 2010, and December 16, 2010. Sagaser asserted the attomey/client privilege throughout the deposition in response to questions regarding his communications with Attorney C. Russell Georgeson and James Bratton in October 2009 and following his resignation from the Law Firm.

Respondents filed the current lawsuit on September 7, 2011. The complaint sets forth causes of action against Sagaser for breach of fiduciary duty, breach of the duty of loyalty, conversion, and invasion of privacy. Respondents allege, in pertinent part, that “Sagaser used confidential information of the Plaintiffs that Sagaser had obtained in connection with his firm’s representation of the Plaintiffs (1) to encourage Bratton to bring a meritless action against Plaintiffs [(i.e., Bratton v. Jones)]; (2) to draft a complaint for Bratton against the Plaintiffs; and (3) to represent, to advise and to assist Bratton in his action against the Plaintiffs.”

Sagaser is accused of “systematically reviewing, downloading, and printing” respondents’ privileged and confidential file materials on multiple occasions without proper authorization or any legitimate purpose. The documents and/or confidential information were then provided to Bratton and Attorney Georgeson without respondents’ knowledge or consent. As a result, the *488 pleadings in Bratton v. Jones

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Bluebook (online)
216 Cal. App. 4th 481, 156 Cal. Rptr. 3d 492, 2013 Cal. App. LEXIS 391, Counsel Stack Legal Research, https://law.counselstack.com/opinion/castleman-v-sagaser-ca5-calctapp-2013.