Run The World Inc. v. Jiang

District Court, N.D. California·Decided March 28, 2025·No. 3:23-cv-03130·Unknown

Opinion

RUN THE WORLD INC., Case No. 23-cv-03130-AMO

Plaintiff, ORDER GRANTING FORMER v. COUNTERCLAIM DEFENDANTS’ MOTIONS FOR ATTORNEY'S FEES Re: Dkt. Nos. 122, 124 Defendant.

Former Counterclaim Defendants Run The World, Inc. (“RTW”), and Xiaoyin Qu (together “Counterclaim Defendants”) both filed Motions for Attorney’s Fees related to their respective special motions to strike pursuant to California’s Anti-SLAPP statute. The Motions for Attorney’s Fees were heard before this Court on March 13, 2025. Having read the papers filed by the parties and carefully considered their arguments therein and those made at the hearing, as well as the relevant legal authority, the Court hereby GRANTS the motions for the following reasons. This Order assumes familiarity with the factual allegations underlying this case, recounted more fully in its Order Granting Counterclaim Defendants’ Motions to Dismiss (ECF 114) and its Order Denying Defendant Xuan Jiang’s Motion to Dismiss for Lack of Subject Matter Jurisdiction, issued in conjunction with this Order. The Court briefly recounts the procedural history because it informs Counterclaim Defendants’ Motions for Attorney’s Fees. RTW and Qu jointly filed their Special Motion to Strike SLAPP Claims on January 9, 2024, seeking elimination of Qu’s claim for abuse of process (“SLAPP Claims”).1 ECF 54. RTW and Qu also filed a joint Motion to Dismiss on the same date. ECF 52. Jiang responded to the Motion to Dismiss by filing her First Amended Counterclaims and a brief Opposition noting the same on February 6, 2024. ECF 58, 59. She also opposed the Special Motions to Strike. ECF 60. RTW understandably began preparing a reply in support of its Special Motion to Strike, incurring $4,365 in fees. See Hayward Decl. (ECF 123) ¶¶ 8, 20(b). But on February 15, 2024, before the reply was filed, the Court entered an Order terminating as moot the pending motions to dismiss, “as well as their special motions to strike at Dkt. No. [51] and [54] in light of Xuan Jiang’s amended counterclaim.” ECF 66. The Court also stated, “The Counterclaim-Defendants may renew their respective motions if appropriate in response to the amended counterclaim.” Id. Rather than drop the SLAPP Claims in response to the RTW’s and Qu’s Special Motions to Strike, Jiang doubled-down in her First Amended Counterclaim by re-asserting the SLAPP Claims and augmenting them with argument and case citations. FACC (ECF 58) ¶¶ 61, 76, 90, 112, 118, 237-242. Counsel for RTW began preparing a Renewed Special Motion to Strike. Hayward Decl. ¶ 11. Before RTW filed the Renewed Motion, Jiang proposed a stipulation to permit her to file a Second Amended Counterclaim. Id. ¶ 10. By this time, RTW and Qu had jointly incurred more than $27,000 in attorney fees preparing the Special Motion to Strike and related portions of the Motion to Dismiss Counterclaims. Conrad Decl. (ECF 55); Hayward Decl. ¶ 6. Lastly, RTW incurred $3,800 preparing a Renewed Special Motion to Strike before learning that Jiang wished to finally stipulate to drop the SLAPP Claims through further amendment. Id., ¶¶ 11, 12(c). The parties filed the Stipulation on February 26, 2024, and the Court granted the Stipulation by Order entered on February 27, 2024. ECF 77, 79. Jiang filed her Second Amended Counterclaim (“SACC”) on February 26, 2024, which was deemed filed on February 27, 2024. ECF 78. See also ECF 79 at 4. The parties state in the Stipulation’s recitals that “Counterclaimant Xuan Jiang seeks to further amend her Counterclaims to moot the issues raised in Counterclaim-Defendants’ now-terminated Special Motions to Strike[.]” ECF 79 at 2. Counterclaim Defendants now move to recover attorney’s fees incurred in relation to their anti-SLAPP motion. See RTW Mot. (ECF 122); Qu Mot. (ECF 124). Jiang opposes. Opp. (ECF 127). A. Legal Standard California’s anti-SLAPP statute protects, among other things, any conduct “in furtherance of a person’s right of free speech,” including “any written or oral statement or writing made in a place open to the public or a public forum in connection with an issue of public interest.” Cal. Code Civ. Proc. § 425.16(e). “Under California’s anti-SLAPP statute, a defendant may bring a special motion to strike a cause of action arising from constitutionally protected speech or petitioning activity.” Barry v. State Bar of California, 2 Cal. 5th 318, 320 (2017); Cal. Code Civ. Pro. § 425.16. Parties sued in federal court can bring anti-SLAPP motions to strike state law claims and are entitled to attorney’s fees and costs when they prevail. Verizon Delaware, Inc. v. Covad Communications Co., 377 F.3d 1081, 1091 (9th Cir. 2004). “California’s anti-SLAPP (‘Strategic Lawsuit Against Public Participation’) statute provides a mechanism for a defendant to strike civil actions brought primarily to chill the exercise of free speech.” Metabolife Int’l, Inc. v. Wornick, 213 F. Supp. 1220, 1221 (S.D. Cal. 2002). “[A]ny SLAPP defendant who brings a successful motion to strike is entitled to mandatory attorney fees.” Ketchum v. Moses, 24 Cal. 4th 1122, 1131 (2001). The purpose of the fee-shifting provision is “to discourage such strategic lawsuits against public participation by imposing the litigation costs on the party seeking to chill the valid exercise of the constitutional rights of freedom of speech and petition for the redress of grievances.” Id. at 1131 (internal quotation omitted). Because “[t]he anti-SLAPP statute reflects the Legislature’s ‘strong preference for awarding attorney fees to successful defendants,’ ” courts interpret the statute “broadly to favor an award of attorney fees to a partially successful defendant.” Lin v. City of Pleasanton, 176 Cal. App. 4th 408, 425-26 (2009), as modified on denial of reh’g (Aug. 11, 2009). B. Entitlement to Fees Jiang argues that Counterclaim Defendants are not entitled to attorney’s fee awards because they were not “prevailing parties” under the anti-SLAPP statute. See Opp. at 8-12. “A defendant that brings an anti-SLAPP motion to strike may ‘prevail,’ even if the court did not actually grant the motion. Where the plaintiff dismisses the alleged SLAPP before the court rules on a pending motion to strike, the mooting of the merits of the motion does not bar a defendant from recovering attorney fees.” Law Offices of Bruce Altschund v. Wilson, 632 Fed. App’x. 321 (9th Cir. 2015) (unpublished) (affirming award of attorney fees and costs to defendant where plaintiff dismissed the action pursuant to Fed. R. Civ. P. 41(a)(1)(A)(i) after the district court took defendant’s anti-SLAPP motion under submission). Federal district courts regularly rely on this and related California Court of Appeal authority in support of the premise that “where the plaintiff voluntarily dismisses an alleged SLAPP suit while a special motion to strike is pending,” the defendant is considered the prevailing party, and “the trial court has discretion to determine whether the defendant is the prevailing party for purposes of attorney’s fees under . . . section 425.16(c).” Garrett v. Hine, No. 121CV00845DADBAK, 2022 WL 2067903, at *7 (E.D. Cal. June 8, 2022) (quoting Coltrain v. Shewalter, 66 Cal. App. 4th 94, 107 (1998)); see also Mireskandari v. Mail, No. 12-cv-02943-MMM-FFM, 2014 WL 12561581, at *6 (C.D. Cal. Aug. 4, 2014); Ryans v. Editions Ltd. West, Inc., No. 06-cv-4812-PVT, 2007 WL 2778408, at *3 (N.D. Cal. Sept. 21, 2007). A plaintiff’s amendment of a complaint to remove SLAPP claims “is tantamount to a voluntary dismissal of those claims,” particularly where those claims “would likely have become subject to another anti-SLAPP motion.” Art of Living Found. v. Does 1-10, No. 5:10-cv-05022-LHK, 2012 WL 1565281, at *25 (N.D. Cal. May 1, 2012); see also VACC, Inc. v. Dav

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