Harold Pick v. James Kay, Jr.

• Court: Court of Appeals for the Ninth Circuit
• Decided: January 21, 2022
• Docket: 20-55804
• Status: Unpublished

Opinion

NOT FOR PUBLICATION FILED UNITED STATES COURT OF APPEALS JAN 21 2022 MOLLY C. DWYER, CLERK U.S. COURT OF APPEALS FOR THE NINTH CIRCUIT

HAROLD PICK, an individual; et al., No. 20-55804

Plaintiffs-Appellants, D.C. No. 2:19-cv-07137-DMG-FFM v.

JAMES A. KAY, Jr., an individual; et al., MEMORANDUM*

Defendants-Appellees.

Appeal from the United States District Court for the Central District of California Dolly M. Gee, District Judge, Presiding

Argued and Submitted January 11, 2022 Pasadena, California

Before: CLIFTON, M. SMITH, and WATFORD, Circuit Judges.

Appellants Harold Pick, Jay Francis, and Wireless US, LC appeal from the

district court’s dismissal of their action against appellees James Kay and Lucky’s

Two-Way Radios, Inc. (Kay appellees) and Motorola Solutions, Inc. and Peter

Carlson (Motorola appellees) under the Racketeer Influenced and Corrupt

Organizations Act (RICO), 18 U.S.C. § 1961 et seq. We affirm.

* This disposition is not appropriate for publication and is not precedent except as provided by Ninth Circuit Rule 36-3. Page 2 of 5

1. The district court did not err in dismissing appellants’ complaint under

the Noerr-Pennington doctrine. Petitioning conduct is immunized from statutory

liability under Noerr-Pennington if: (1) the lawsuit at issue imposes a burden on

petitioning rights; (2) the alleged conduct forming the basis of the lawsuit

constitutes protected petitioning activity; and (3) the relevant statute can be

construed to preclude the burden on protected activity. See Sosa v. DIRECTV,

Inc., 437 F.3d 923, 930 (9th Cir. 2006). All three prongs are satisfied here.

First, appellants’ RICO action alleges that three lawsuits pursued by

appellees constituted RICO predicate acts because they violated the Victim and

Witness Protection Act (VWPA), 18 U.S.C. § 1512 et seq. These lawsuits sought

to enforce a valid $1.2 million judgment that Motorola obtained against Pick, such

that imposing RICO liability would burden appellees’ right to seek redress from

the courts. See Ad Visor, Inc. v. Pacific Telephone & Telegraph Co., 640 F.2d

1107, 1110 (9th Cir. 1981); Sosa, 437 F.3d at 932.

Second, the filing of the three lawsuits by the Motorola appellees, and any

conduct incidental to filing, are quintessential protected petitioning activities. See

Freeman v. Lasky, Haas & Cohler, 410 F.3d 1180, 1184 (9th Cir. 2005); Kearney

v. Foley & Lardner, LLP, 590 F.3d 638, 646 (9th Cir. 2009). Funding of the

litigation by the Kay appellees also constitutes protected activity in our circuit. See

Sosa, 437 F.3d at 937; Liberty Lake Invs., Inc. v. Magnuson, 12 F.3d 155, 158–59 Page 3 of 5

(9th Cir. 1993).

Third, the statute on which appellants predicate their RICO action, the

VWPA, can be construed to preclude this burden on protected petitioning activity.

The VWPA imposes liability for actions “harmful” to any person, undertaken

knowingly and “with the intent to retaliate” for providing law enforcement with

truthful information relating to the commission of a federal crime. 18 U.S.C.

§ 1513(e). Because the statute does not “clearly” require the imposition of liability

for the protected petitioning conduct at issue, “we must construe [the statute] so as

to avoid burdening” that conduct. Sosa, 437 F.3d at 931. Thus, the underlying

lawsuits cannot constitute RICO predicate acts unless Noerr-Pennington’s sham

litigation exception applies.

2. The district court correctly determined that appellants failed to

adequately plead the sham litigation exception to Noerr-Pennington, under either

an objectively baseless or serial litigation theory. Under the sham litigation

exception, the Noerr-Pennington doctrine does not protect either an individual

lawsuit that is “objectively baseless,” or a series of lawsuits “‘brought pursuant to a

policy of starting legal proceedings without regard to the merits’ and for an

unlawful purpose.” Id. at 938 (quoting Kottle v. Nw. Kidney Ctrs., 146 F.3d 1056,

1060 (9th Cir. 1998)).

First, appellants cannot adequately plead that any of the three lawsuits at Page 4 of 5

issue were “objectively baseless.” A lawsuit is not objectively baseless when it is

“arguably warranted by existing law” or “based on an objectively good faith

argument.” International Longshore & Warehouse Union v. ICTSI Oregon, Inc.,

863 F.3d 1178, 1188 (9th Cir. 2017) (quoting Pro. Real Estate Invs., Inc. v.

Columbia Pictures Indus., Inc., 508 U.S. 49, 65 (1993)). The California lawsuit

resulted in a jury finding that Pick had fraudulently transferred property to evade

judgment, so far from being objectively baseless, it was judicially determined to be

meritorious. The first Nevada lawsuit was dismissed for lack of standing based on

reasoning that our circuit later rejected and thus cannot be deemed objectively

baseless either. The second Nevada lawsuit presents a closer question. As Pick

points out, that lawsuit resulted in an adverse finding against Motorola, but the

court there determined that the action lacked merit with respect to an individual

who is not a party to the RICO action before us. As none of the lawsuits were

objectively baseless, appellees’ motive for bringing them is immaterial. See

Liberty Lake Invs., 12 F.3d at 159.

Nor does the sham litigation exception apply under a serial litigation theory.

Even assuming that one of the suits at issue here was meritless, a single meritless

suit cannot support the application of the sham litigation exception based on a

serial litigation theory. See International Longshore, 863 F.3d at 1187.

Because, as a matter of law, appellants cannot plead the sham litigation Page 5 of 5

exception, the district court did not abuse its discretion in denying leave to amend.

3. We need not address whether appellants adequately alleged an alternative

RICO theory of corporate bribery under California Penal Code § 641.3. Because

the Noerr-Pennington doctrine bars a RICO claim based on appellees’ three

lawsuits, appellants have failed to allege at least two predicate acts as required to

establish a claim under RICO. 18 U.S.C. § 1962(c).

Appellees’ unopposed request for judicial notice (Dkt. 33) is GRANTED.

AFFIRMED.