California’s anti-SLAPP law has been misused and weaponized against the very class of litigants that it was meant to protect in the first place, namely, individual workers. The traditional justification for anti-SLAPP law is rooted in the fear that meritless causes of action brought forth by powerful corporations to chill individual workers from speaking on matters of public significance, or Strategic Lawsuits Against Public Participation (“SLAPP”), would be detrimental to a free and democratic society. To protect free speech for vulnerable workers, California Code of Civil Procedure Section 425.16 allows an individual on the receiving end of a SLAPP lawsuit to file a special motion to strike that lawsuit under Section 425.16 subdivision (b)(1) and recover attorney fees under subdivision (c)(1). The specter of the attorney fee shifting provision can make corporations think twice before attempting to hammer an individual worker with an expensive SLAPP lawsuit, and thereby accomplishes the legislative purpose of responding to the “disturbing increase in [SLAPP] lawsuits.”
But California’s state caselaw engages in borderline metaphysical musings in the form of its gravamen test for analyzing whether a complaint alleges claims arising from free speech and other protected activity. In determining whether a cause of action is based on protected activity, the court will examine “the principal thrust or gravamen of the plaintiff’s cause of action.” But this test has produced a jurisprudence of uncertainty which has chilled the ability of litigants, both plaintiffs or defendants, to respond to lawsuits with cross-complaints and thus frustrates the original purpose of anti-SLAPP measures under section 425.16
Background of the Statute
California’s anti-SLAPP law under Code of Civil Procedure Section 425.16 contains the special motion-to-strike provision and the fee-shifting position. Under section 425.16 subdivision (b)(1), a defendant who brings a special motion to strike must first establish that the plaintiff’s cause of action was “arising from” the defendant’s First Amendment speech or that the petitioning conduct was “in connection with a public issue.” If the defendant makes this showing, the burden then shifts to the plaintiff, who must establish “a probability” of prevailing based on the pleadings and affidavits. If the plaintiff fails, the court must grant the motion to strike.
The Gravamen Test Creates Judicial Uncertainty
Courts have often used the “gravamen test” to assess whether to grant a special motion to strike. In Raining Data v. Barrenechea, Raining Data, a software development company, sued an individual, Barrenechea, for alleged misappropriation of a trade secret. In response, Barrenechea filed a cross-complaint against Raining Data for unfair business practices, violation of civil rights, committing trade libel, harassment and other relational torts, but alleged few specific acts on the part of Raining Data. Unsurprisingly, Raining Data filed a special motion to strike under section 425.16, California’s anti-SLAAP law. In its motion, Raining Data argued that Barrenechea’s cross-complaint squarely fell within subdivision (e)(1) for protected conduct, since one of its causes of action, malicious prosecution, necessarily arose out of Raining Data’s lawsuit. Further, according to Raining Data, the rest of Barrenechea’s complaint was based on allegations of Raining Data’s communications with customers in connection with its lawsuit, and thus were statutorily protected under subdivision (e)(2) which protects “any written or oral statement or writing made in connection with an issue under consideration or review by a . . . judicial body.” Thus, Raining Data urged that Barrenechea’s cross-complaint arose from Raining Data own lawsuit.
But Barrenchea urged that its cross-complaint had nothing to do with Raining Data’s lawsuit. Instead, Barrenchea argued that its cross-complaint centered on an incident in which Raining Data’s attorneys discredited Barrenchea in front of his own customers by telling them that unless they stopped working with Barrenchea, Raining Data would no longer license products to them. The court was thus confronted with the issue of whether Barrenchea’s complaint was a complaint arising from the filing of Raining Data’s lawsuit, or if it was a complaint arising from other, non-protected incidents of Raining Data’s conduct. Under the gravamen test, it is the principal thrust of the plaintiff’s cause of action which is dispositive in the context of an anti-SLAPP, rather than any one specific allegation. Applying this rule, the court summarily and without explanation concluded that the gravamen of the complaint was directed at Raining Data’s filing of the complaint, and that the reference to one potentially non-protected activity “could not save the entire cross-complaint from the anti-SLAPP motion.” Arguably, the court could have just as readily concluded that it was the specific allegation of Raining Data’s attorneys threatening Barrenchea’s customers, rather than Raining Data’s lawsuit, which constituted the gravamen of the complaint. This is the problem of the gravamen test: there is no principled way to predict which allegation the court will anchor onto as the core of the complaint.
The Gravamen Test Compared with a Compulsory Counterclaim
Under Federal Rules of Civil Procedure (FRCP) 13(a), a pleading must state as a counterclaim any claim that the pleader has against an opposing party if a claim “arises out of” the same transaction or occurrence that is the subject matter of the complaint. The FRCP “arises out of” language is not directly analogous to the gravamen language. Instead, “arises out of” analysis compares one nucleus of operative fact against another nucleus of operative fact to see how much factual overlap there is. Meanwhile, the “arising from” analysis of the gravamen test requires the identification of the primary core of a complaint. In Raining Data, for example, the court concluded that the principal thrust of the cross-complaint was Raining Data’s filing of a lawsuit against Barrenchea. In contrast to that core, the court concluded that Barrenchea’s single allegation of business interference in its cross-complaint against Raining Data was merely “incidental.” But where is the line between the core of a complaint and incidental matter? Finding that line is a source of uncertainty for litigants.
Callanan v. Grizzly Designs, LLC: A Solution to Uncertainty
In Callanan v. Grizzly Designs, LLC the court eschewed the gravamen test used several years earlier in Raining Data when it addressed the “arising from” issue with a two-step analysis reminiscent of Ashcroft v. Iqbal.
Like in Raining Data, the issue in Callanan was whether a cross-complaint filed by Connor Callanan (“Callanan”) against Charles Menken, Steven Menken, and Grizzly Designs, LLC (“the Menkens”) qualified as “arising from” protected conduct under section 425.16 of California’s anti-SLAPP code.
The Menkens hired Plaintiff Callanan and his associate Marino to provide services at the Menkens’ cannabis farm. Because the farm was in a somewhat remote location, Callanan and Marino began living at the farm while working there. But the relationship between Callanan and the Menkens deteriorated when the Menkens became openly hostile with their full-time employees. The hostile relationship reached its tipping point when an accident with the woodstove resulted in one of Menkens’ employee housing buildings suffering fire damage and Callanan suffering severe burns. Since those events, Marino filed suit against the Menkens for various labor violations, and the Menkens cross-complained against not only Marino, but Callanan as well for intentional and negligent destruction of property.
Callanan in turn, filed a cross-complaint against Menkens for wage and hour violations. The Menkens filed a section 425.16 special motion to strike Callanan’s cross-complaint, which the trial judge granted. Crucially, Callanan included a statement in his cross-complaint that he was only suing the Menkens because they sued him first. While the trial judge treated this statement as essential in understanding the principal thrust of the complaint and ultimately granted the special motion to strike, the appellate court in Callanan set aside Callanan’s statement, much like how the Supreme Court in Ashcroft v. Iqbal set aside legal conclusions in the complaint before proceeding to the next step of analysis. Having set aside Callanan’s statement, which was fatal to his cross-complaint at the trial court, the appellate court then proceeded to assess whether the remaining allegations arose from protected activity. The court found that it did not, because Callanan’s complaint was a complaint for wage and hour claims, and such claims do not arise from protected speech activity. Accordingly, the appellate grant denied the Menkens’ special motion to strike and reversed the trial court. In doing so, the Callanan court prevented a company from weaponizing anti-SLAPP measures against litigants like Callanan who are individual workers, and the court sent a clear message to future employees about circumstances that justify a cross-complaint. Further, it did so by using analysis similar to Federal Rule 12(b)(6) instead of the gravamen test. The result is greater judicial certainty, and as a result of that certainty, employees can raise cross-complaints with greater confidence
Cases like Callanan will restore anti-SLAPP back to its original contemplated usage by individual workers against companies–not the other way around.