Foundation for Taxpayer & Consumer Rights v. Garamendi

34 Cal. Rptr. 3d 368, 132 Cal. App. 4th 1375, 2005 Daily Journal DAR 11764, 2005 Cal. Daily Op. Serv. 8648, 2005 Cal. App. LEXIS 1513
CourtCalifornia Court of Appeal
DecidedSeptember 27, 2005
DocketB176461
StatusPublished
Cited by25 cases

This text of 34 Cal. Rptr. 3d 368 (Foundation for Taxpayer & Consumer Rights v. Garamendi) 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
Foundation for Taxpayer & Consumer Rights v. Garamendi, 34 Cal. Rptr. 3d 368, 132 Cal. App. 4th 1375, 2005 Daily Journal DAR 11764, 2005 Cal. Daily Op. Serv. 8648, 2005 Cal. App. LEXIS 1513 (Cal. Ct. App. 2005).

Opinion

Opinion

FLIER, J.

Mercury Insurance Group (Mercury) appeals an award of attorney fees and costs following a denial of its special motion to strike a petition and complaint as a strategic lawsuit against public participation (SLAPP). 1 Mercury was not a named defendant but obtained leave to intervene in the action for the express purpose of filing a special motion to strike. The trial court found Mercury’s special motion to strike was frivolous and awarded petitioners their attorney fees and costs. We affirm.

FACTS AND PROCEDURAL HISTORY

A. The Complaint

On October 10, 2003, the Foundation for Taxpayer and Consumer Rights, Consumers Union of the United States, Inc., Southern California Leadership Conference of Greater Los Angeles and National Council of La Raza (petitioners) filed a petition for writ of mandate and complaint (complaint) to invalidate Senate Bill No. 841 (2003-2004 Reg. Sess.) (Sen. Bill 841). 2 The *1380 complaint alleged Sen. Bill 841 was an invalid and unconstitutional amendment of Proposition 103, the “Insurance Rate Reduction and Reform Act,” that was passed by the voters in 1988. Petitioners sought to enjoin defendants John Garamendi, Commissioner of Insurance of the State of California (Insurance Commissioner), and the State of California (State) from implementing or enforcing Sen. Bill 841.

Among other things, the complaint referred to Sen. Bill 841 as an “insurer-sponsored” legislation. Although petitioners named only the Insurance Commissioner and the State as defendants, the body of the complaint contained several references to Mercury.

Specifically, the complaint alleged that Mercury had previously sponsored a bill (Sen. Bill No. 689 (2001-2002 Reg. Sess.) (Sen. Bill 689)) that had failed to become law. Petitioners further alleged: “Despite public controversy, both over the substance of the bill and the campaign cash that its sponsor, Mercury Insurance, had spent in the period surrounding its introduction, [Sen. Bill] 689 passed both houses” of the Legislature, only to be vetoed by Governor Davis. (Fn. omitted.) Under the heading, “Another Infusion Of Political Contributions From Mercury” (underscoring omitted), the complaint alleged that Sen. Bill 689 was substantially resurrected by a new bill, Sen. Bill 841, that was sponsored by Mercury, “a major campaign donor to Sacramento lawmakers.” The complaint alleged that Sen. Bill 841 was passed by the Legislature and signed into law by Governor Davis after Mercury “poured approximately $340,000 into political contributions to lawmakers statewide since the [Governor’s] veto of [Sen. Bill] 689 the year before, and an additional $175,000 into [the] Governor’s anti-recall campaign after he signed [Sen. Bill] 841 [into law].” (Fn. omitted.) Petitioners alleged Mercury had contributed a total of $895,100 to California lawmakers during this period. Petitioners further alleged that Mercury had decided to sponsor Sen. Bill 689 and Sen. Bill 841 after the Insurance Commissioner issued a regulation limiting persistency discounts.

On October 10, 2003, petitioners filed a motion for an order directing the issuance of a peremptory writ of mandate and set the matter under regular notice for hearing on March 1, 2004. Petitioners then made an ex parte application for an order advancing the hearing date before Superior Court Judge Dzintra I. Janavs, who was assigned the case. 3

*1381 On October 15, 2003, Judge Janavs advanced the hearing of petitioners’ motion for peremptory writ of mandate to November 25, 2003, and established an expedited briefing schedule.

B. Mercury’s Insertion in the Action as Intervener

On October 23, 2003, after learning of petitioners’ complaint, Mercury filed a request for special notice, in which it stated it intended to intervene in the action. The following day, petitioners’ counsel offered to stipulate to Mercury’s intervention so long as Mercury did not expand the scope of the issues or delay the briefing and hearing schedule previously set by the court. Mercury rejected petitioners’ offered stipulation, asserting it was unreasonable to expect Mercury to file an opposition to petitioners’ pending motion for writ of mandate in the time available.

Mercury then filed two ex parte applications with the trial court; an application seeking leave to intervene in the case and an application for an order shortening notice time to bring a special motion to strike under the anti-SLAPP statute. (Code Civ. Proc., § 425.16.) 4 Mercury proposed to combine its anti-SLAPP motion with a conventional motion to strike those portions of the complaint mentioning Mercury. (§§ 435, 436.) Among other things, Mercury claimed it would suffer the immediate harm of not being able to strike “unfounded bribery allegations” in the complaint if it were not allowed to intervene.

On October 29, 2003, Mercury presented its ex parte applications to Superior Court Judge David P. Yaffe because Judge Janavs was unavailable. Judge Yaffe denied Mercury’s ex parte application to intervene on the ground that Mercury was attempting to enlarge the issues.

As a result, Mercury filed a petition for peremptory writ of mandate in this court on November 4, 2003, to set aside Judge Yaffe’s order denying Mercury leave to intervene.

*1382 On November 20, 2003, we issued a notice of intention to grant a peremptory writ of mandate in the first instance. (Palma v. U.S. Industrial Fasteners, Inc. (1984) 36 Cal.3d 171 [203 Cal.Rptr. 626, 681 P.2d 893].) In issuing the Palma notice, we observed that Judge Yaffe had two concerns in denying Mercury leave to intervene. First, the judge was concerned that the briefing schedule and hearing on petitioners’ motion for a peremptory writ of mandate would be delayed if Mercury was granted leave to intervene. We noted, however, that Mercury had not asked Judge Yaffe to extend any dates and Mercury’s counsel had indicated he was prepared to meet the existing deadline. 5 Second, Judge Yaffe was concerned that Mercury would try to expand the issues in the case by filing its special motion to strike. We observed, however, that “if [Mercury] is entitled to file such a motion, it is improper to deny intervention solely because of a desire to prevent the filing of such a motion.” We also noted that Mercury’s counsel had stipulated on the record that Mercury would not appeal if its special motion to strike were denied. 6

Accordingly, our Palma notice expressed our intention to issue a peremptory writ to require the trial court to vacate its order denying Mercury’s ex parte application for leave to intervene and to thereafter enter a new and different order granting the application.

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34 Cal. Rptr. 3d 368, 132 Cal. App. 4th 1375, 2005 Daily Journal DAR 11764, 2005 Cal. Daily Op. Serv. 8648, 2005 Cal. App. LEXIS 1513, Counsel Stack Legal Research, https://law.counselstack.com/opinion/foundation-for-taxpayer-consumer-rights-v-garamendi-calctapp-2005.