SOUTHERN CALIFORNIA NESSAH EDUCATIONAL AND CULTURAL CENTER, A CALIFORNIA NONPROFIT RELIGIOUS CORPORATION VS SHAHIN SADIK, ET AL.

Tentative Rulings

Case Number: 22STCV11232 Hearing Date: July 11, 2023 Dept: 17

Superior Court of California

County of Los Angeles

DEPARTMENT 17

TENTATIVE RULING

Defendants’ anti-SLAPP motions are DENIED.

On 4/1/2022, Plaintiff Southern California Nessah Educational and Cultural Center (Plaintiff) filed suit against Shahin Sadik, Simon Etehad, Farhad Pourbaba, Parvis Benyamini, Dan Kahen, and Abraham Shofet, alleging: (1) declaratory relief; (2) injunctive relief; and (3) intentional interference with contractual relations.

On 10/24/2022, leave to amend was granted to allow Plaintiff to add a cause of action for malicious prosecution, and to add two new defendants (the 9418 Action Plaintiffs Ben Naim and Joseph Cohen).

Now, Defendants Cohen, Pourbaba, and Naim specially move to strike Plaintiff’s malicious prosecution cause of action.

While Defendants moved separately, they raised substantially similar arguments. As such, the Court has consolidated its analysis into a single ruling.

Factual Background

Nessah is a Synagogue and Cultural Center in Beverly Hills. This dispute arises out of Nessah’s 2022 Board of Director’s election. Defendants here (9418 Plaintiffs) contended that they were prevented by security from entering the synagogue to participate in the official election, and therefore conducted their own ad hoc sidewalk election. Based on the results of the sidewalk election, 9418 Plaintiffs then named themselves the rightful directors of Nessah, and initiated litigation against Plaintiff here to have the results of their election be officially recognized.

Plaintiff’s claim for malicious prosecution arises out of Defendants’/ 9418 Plaintiffs’ lawsuit.

Legal Standard

On a special motion to strike pursuant to Code of Civil Procedure (CCP) section 425.16, also known as an anti-SLAPP motion, moving parties have the initial burden to demonstrate that a cause of action is subject to a special motion to strike. (Martinez v. Metabolife Inter. Ins. (2003) 113 Cal.App.4th 181, 186; Fox Searchlight Pictures Inc. v. Paladino (2001) 89 Cal.App.4th 294, 304.) First, the court must determine whether moving parties have made a prima facie showing that the attacked claims arise from a protected activity, including defendants’ right of petition, or free speech, under a constitution, in connection with issues of public interest. (Healy v. Tuscany Hills Landscape & Recreation Corp., (2006) 137 Cal.App.4th 1, 5; Soukup v. Law Offices of Herbert Hafif (2006) 39 Cal.4th 260, 278; Code Civ. Proc., 425.16, subd. (e).) Moving parties can satisfy this burden by showing (1) statements made before legislative, executive or judicial proceedings, or made in connection with matters being considered in such proceedings, or (2) statements made in a public forum, or other conduct in furtherance of the exercise of the constitutional rights of petition or free speech, in connection with issues of public interest. (Code Civ. Proc., 425.16, subd. (e); Equilon Ent., LLC v. Consumer Cause, Inc. (2002) 29 Cal.4th 53, 66.)

If the court finds this showing has been made, it must dismiss the cause of action unless the plaintiff meets its burden to demonstrate a probability of prevailing on the claim. (Code Civ. Proc., 425.16, subd. (b)(1); Balzaga v. Fox News Network, LLC (2009) 173 Cal.App.4th 1325, 1336.) This means that the plaintiff must state a legally sufficient claim and must then present evidence that substantiates or sustains the claim. (Equilon Enterprises v. Consumer Cause, Inc. (2002) 29 Cal.4th 53, 61; see also Wilson v. Parker, Covert & Chidester (2002) 28 Cal.4th 811, 821 [plaintiff “must demonstrate that the complaint is both legally sufficient and supported by a sufficient prima facie showing of facts to sustain a favorable judgment if the evidence submitted by the plaintiff is credited”].)

Discussion

Defendants specially move to strike Plaintiff’s malicious prosecution cause of action.

The first prong of the anti-SLAPP analysis is met. As stated in Jarrow Formulas, Inc. v. LaMarche (2003) 31 Cal.4th 728, 741, the Anti-SLAPP statute, “potentially may apply to every malicious prosecution action, because every such action arises from an underlying lawsuit, or petition to the judicial branch. By definition, a malicious prosecution suit alleges that the defendant committed a tort by filing a lawsuit. [Citation.]” (See also Briggs v. Eden Council for Hope & Opportunity (1999) 19 Cal.4th 1106, 1113 [“plainly read, [Anti-SLAPP] encompasses any cause of action against a person arising from any statement or writing made in, or in connection with an issue under consideration or review by, an official proceeding or body”].)

Given that Defendants have made a prima facie showing that the malicious prosecution cause of action arises from protected activity, the burden shifts to Plaintiff to demonstrate a probability of prevailing on the claim. (Code Civ. Proc., 425.16, subd. (b)(1).)

“To prevail in a malicious prosecution action under California law, a malicious prosecution plaintiff (the defendant in the underlying action) must show that (1) the plaintiff in the underlying action pursued a claim with subjective malice, (2) the claim was brought without objective probable cause, and (3) the underlying action was terminated on the merits in favor of the defendant.” (Lane v. Bell (2018) 20 Cal. App. 5th 61, 63.)

Here, Plaintiff’s malicious prosecution cause of action is based on a complaint (the 9418 Action) filed by Defendants here (Plaintiffs in the 9418 Action). In the Complaint, the 9418 Plaintiffs sought a judicial determination over the validity of the election of directors and officers of Plaintiff or, in the alternative, for an order setting a new election for officers and directors of Plaintiff.

Defendants argue that Plaintiff cannot meet its burden because: (1) Plaintiff cannot show lack of probable cause or malice; and (2) Plaintiffs’ reliance on advice of counsel is a complete defense to the claim.[1]

As to the element of lack of probable cause, Defendants argue that two critical factors likely influenced the adverse ruling on their Complaint: (1) Defendants/9418 Plaintiffs attorney submitted much of the 9418 Plaintiffs’ evidence and arguments in a document entitled “Statement of Facts” which the Court refused to consider; and (2) failed to raise crucial arguments until the Reply brief, and thus were deemed waived by the Court. (See RJN, Exh. 3, pg. 8.)

As such, Defendants argue that their Complaint was not frivolous or unsuccessful on the merits, but based on procedural defects with their substantive motion. Moreover, Defendants argue that their motion was brought for the very purpose section 9418 was enacted, i.e., to determine the validity of the election of directors of Plaintiff, under the factual circumstances set forth in the Verified Complaint and the declarations attached thereto (RJN Exh. 1.) Defendants contend that their Verified Complaint was accompanied by declarations from witnesses who attended the meeting wherein 7 directors were elected, and which supported the allegations of procedural improprieties observed including: failure of the existing board to nominate a sufficient number of directors to fill all positions on the Board (Verified Complaint, 5-8); the rejection of candidate Ben Naim, who had submitted a valid petition for nomination (Verified Complaint, 9-10), and the exclusion of members by armed security guards from the noticed Membership Meeting (Verified Complaint, 15-18), are set forth in the Verified Complaint, as is the conduct of the membership meeting on the steps of NESSAH and the election of directors thereat (Verified Complaint, 17-29).

As to the element of malice, Defendants argue that Plaintiff cannot show malice because the Action was filed for the purpose intended by the statute, and was pursued in good faith.

Finally, Defendants argue that good faith reliance on the advice of counsel is a complete defense to a malicious prosecution claim. (Albertson v. Raboff (1960) 185 Cal.App.2d 372, 385.) Here, Defendants submitted evidence that they relied on the advice of attorney Stacey Sokol in filing the 9418 Action.

In opposition, Plaintiff submitted substantial evidence to argue that it can support its malicious prosecution claim. In particular, Plaintiff submitted evidence that the 9418 Plaintiffs’ central claims underlying their lawsuit were demonstrably false. For example, 9418 Plaintiffs claimed that they were prevented from entering the Synagogue to participate in the Board of Director’s election. However, 9418 Plaintiffs submitted only two declarations attesting to their story: from Plaintiff Fred Pourbaba (the acknowledged architect of the pre-planned sidewalk voice vote), and Stacy Sokol (Plaintiffs’ counsel of record). 9418 Plaintiffs alleged that 225 Nessah members were physically prevented from entering Nessah on March 13, 2022. (Schied. Decl. Ex. F, Plaintiffs’ Opening Brief at p. 4:16-20.) Yet Plaintiffs did not obtain a single declaration from any member besides Mr. Pourbaba attesting to that story. Moreover, Plaintiff here produced dozens of videos and hours of security footage which expressly demonstrated that security guards were instructed to, and did, help members enter the synagogue, thereby expressly discounting 9418 Plaintiffs’ account. ((Ex. 22, Declaration of Mahnaz Maghen, 2).

Indeed, the Court presiding over 9418 Plaintiffs’ case noted these weaknesses:

“The court cannot find on the evidence presented that [Nessah] prevented members from entering the synagogue to deliver their ballots. Plaintiffs present little persuasive evidence to support their claim . . . . Video evidence shows an individual (Zomorodi) inviting people to come into the synagogue to drop off their ballots [evidentiary cites]. Still photographs also do not support Plaintiffs’ position [evidentiary cite].”

“The court also questions the reliability of Plaintiffs’ witnesses estimates of the crowd that had assembled outside the synagogue . . . . Plaintiffs have provided no disinterested third-party witness statements.”

“Accordingly, Plaintiffs do not credibly demonstrate those assembled on the steps of the synagogue were precluded from entering it. In fact, the testimonial and video evidence proffered by [Nessah] is more credible—persons assembled were invited into the synagogue and apparently chose not to participate. [evidentiary cites].”

(Schied. Decl., Ex. C, 9418 Order, at 6-7.)

Moreover, Plaintiff here submitted evidence that after conducting the sidewalk election, the 9418 Plaintiffs began asserting control over Nessah’s business affairs. This included acts like contacting Nessah’s bank, and demanding control of Nessah’s operating account. They also formed a plan to “hire an outside consultant to hack all [computer] systems to gain control by the new officers.” (Notice of Special Meeting (Ex. 14 to Zomorodi Decl.).)

In order to meets its burden in an anti-SLAPP motion, “the plaintiff must demonstrate that the complaint is both legally sufficient and supported by a sufficient prima facie showing of facts to sustain a favorable judgment if the evidence submitted by the plaintiff is credited.” (Matson v. Dvorak (1995) 40 Cal.App.4th 539, 548 [internal quotations omitted].)

Here, the Court finds Plaintiff’s evidence to be sufficient to show a probability of success as to malicious prosecution. As for lack of probable cause, Plaintiff submitted evidence to show that Defendants/9418 Plaintiffs: (1) could not have reasonably believed their sidewalk election was valid; and (2) that their claims that they were prevented from participating in the official election were untrue, unsupported and refuted by objective footage; and (3) their underlying allegations consistently changed as they abandoned allegations throughout litigation which were directly refuted by evidence (See e.g. Plaintiff’s evidence as to the integrity of Nessah’s membership list, exclusion of Ben Naim as Board of Directors candidate; See Opp., 13:13- 16:7.) (Soukup v. Law Offices of Herbert Hafif (2006) 39 Cal.4th 260, 292) (no probable cause when supported by “facts which he has no reasonable cause to believe are true.”)

As for malice, this element of malicious prosecution focuses on the subjective intent or purpose with which the defendant acted in initiating the prior action. (Soukup v. Law Offices of Herbert Hafif (2006) 39 Cal.4th 260, 292. “The motive of the defendant must have been something other than . . . the satisfaction in a civil action of some personal or financial purpose. [Citation.] The plaintiff must plead and prove actual ill will or some improper ulterior motive. [Citation.]” (Downey Venture v. LMI Insurance Co. (1998) 66 Cal.App.4th 478, 494, emphasis in original.) Here, as already noted, Plaintiff submitted evidence that Defendants/9418 Plaintiffs’ claims were unsupported by evidence, and were based on demonstrably false claims. Moreover, Plaintiff submitted evidence that Defendants/9418 Plaintiffs engaged in a campaign of interference, including interfering with Plaintiff’s bank accounts, and formulating a plan to hack into Plaintiff’s computer system. This evidence is sufficient to show that Defendant’s actions were motivated by actual ill will toward Plaintiff, rather than an actual legitimate personal or financial purpose.

This conclusion is not disrupted by Defendant’s argument that Plaintiff’s claim is barred by the advice of counsel defense. As noted by Plaintiff, “Good faith reliance on the advice of counsel, after truthful disclosure of all the relevant facts, is a complete defense to a malicious prosecution claim.” (Bisno v. Douglas Emmett Realty Fund 1988 (2009) 174 Cal.App.4th 1534, 1544, emphasis added). The defense fails when a client fails to disclose known facts, statements, events, or circumstances. (See Klotz v. Alexander (1962) 203 Cal.App.2d 238, 244-245.) Counsel’s advice must be sought in good faith and “not as a mere cloak to protect one against a suit for malicious prosecution.” (Bertero v. National Gen. Corp. (1974) 13 Cal.3d. 43, 55.) Here, Defendants’ declarations do not reflect what they told Mr. Sokol or indicate that they disclosed all relevant facts. In light of Plaintiff’s evidence which suggests Defendants knowingly misrepresented material facts about the election process, Plaintiff’s evidence is sufficient at this stage to show that Defendants may not prevail on an advice of counsel defense.

Finally, Plaintiff’s evidence is sufficient to dispute Defendants’ contention that the 9418 Action was decided based on technicalities, rather than a substantive consideration of the underlying claims. As part of its opposition, Plaintiff submitted evidence that the Court considered all of the 9418 Plaintiffs’ submitted evidence, and indicated that the ruling would be the same even if the waived issues had been considered:

Finally, the 9418 Plaintiffs argue that “two critical factors…may have influenced the Court’s decision in the 9418 Action.” (Mot. 5:10-14.) The factors were that the Court (a) failed to consider evidence and arguments in a document entitled “statement of facts” and (b) their counsel failed to raise arguments about quorum that the Court deemed waived. The 9418 Plaintiffs are wrong on both counts. As to (a), the 9418 Plaintiffs filed a brief with arguments and attached all necessary evidence in declarations and a request for judicial notice. The Court considered all [] of the 9418 Plaintiffs’ submitted evidence: “the evidence purportedly supporting the Statement of Facts is all before this Court.” Schied. Decl., Ex. C at p. 1. As to (b), while the Court deemed the quorum issue waived, it also indicated that “I just – even if it weren’t waived, based on the argument today I think the tentative is correct.” Schied. Decl., Ex. D, July 29, 2022 Transcript at 12:12-24. Neither of these were critical factors in the Court’s calculus.

(Opp., 19: 15-25.)

Based on the foregoing, Defendants’ anti-SLAPP motions are denied.

It is so ordered.

Dated: July , 2023

Hon. Jon R. Takasugi Judge of the Superior Court

Parties who intend to submit on this tentative must send an email to the court at smcdept17@lacourt.org by 4 p.m. the day prior as directed by the instructions provided on the court website at www.lacourt.org. If a party submits on the tentative, the party’s email must include the case number and must identify the party submitting on the tentative. If all parties to a motion submit, the court will adopt this tentative as the final order. If the department does not receive an email indicating the parties are submitting on the tentative and there are no appearances at the hearing, the motion may be placed off calendar. For more information, please contact the court clerk at (213) 633-0517.

Case Number: 22STCV11232 Hearing Date: October 24, 2022 Dept: 17

Superior Court of California

County of Los Angeles

DEPARTMENT 17

TENTATIVE RULING

Plaintiff’s motion for leave to amend is GRANTED.

On 4/1/2022, Plaintiff Southern California Nessah Educational and Cultural Center (Plaintiff) filed suit against Shahin Sadik, Simon Etehad, Farhad Pourbaba, Parvis Benyamini, Dan Kahen, and Abraham Shofet, alleging: (1) declaratory relief; (2) injunctive relief; and (3) intentional interference with contractual relations.

Now, Plaintiff moves for leave to amend to file an amended complaint.

Discussion

Plaintiff seeks leave to amend to add a cause of action for malicious prosecution, and to add two new defendants (9418 Plaintiffs Ben Naim and Joseph Cohen) and new facts from the 9418 Action. Plaintiff contends that the need for these revisions did not arise until the recent conclusion of a separate pending action (the 9418 Suit), which was resolved in Plaintiff’s favor.

In support, Plaintiff argues that no meaningful prejudice would result to Defendants if leave were granted—the Parties have not held an initial case management conference nor has discovery begun.

The Court agrees that leave to amend is warranted here, and that Defendants cannot show any meaningful prejudice if leave to amend were granted. In opposition, Defendants argue that the proposed amendments are for independent causes of action related to the 9418 Action which do not overlap with the facts and thus are purely supplemental. However, Defendant’s own conduct belies this, as they themselves filed a notice of related cases on 4/12/2022 indicating that the two cases involve the same parties and were based on the same or similar claims, arose from substantially similar transactions, and were likely to require substantial duplication of judicial resources if tried separately. Moreover, as demonstrated in Plaintiff’s reply on pages 3 and 4, while the proposed amendments are not all based on identical facts as the original Complaint, they all derive from the same course of wrongful conduct and expand the story of the original Complaint, i.e. that “Defendants spun a demonstrably false narrative of a legitimately conducted board election in order to illegally seize control of Nessah.” (Reply, 2: 13-.14)

Finally, while the 9418 Action was filed after the original Complaint was filed, the proposed amendments concern an ongoing pattern of conduct, rather than allege separate and isolated events. In Honig v. Financial Corp. of America (1992) 6 Cal.App.4th 960, a savings and loan executive filed a complaint while still employed. He alleged a “campaign of harassment, threats, humiliation, debasement and intimidation” in retaliation for his objection to being forced to misrepresent the nature of the certificates of deposit he was selling. (Honig, 6 Cal. App.4th at p .693.) He feared his discharge was imminent and filed suit as a “preventative measure.” (Ibid.) After the complaint was filed, the executive was called to a meeting of the company’s ethics committee. He requested his counsel be present, but the company refused to permit it. (Ibid.) He then refused to discuss the pending lawsuit, disputed the accusations against him, and was fired for insubordination. (Ibid.) More than two years after the original complaint was filed, the company moved for summary judgment. The executive opposed the motion and filed his own motion to amend the complaint to include additional paragraphs relating to the events leading up to the discharge. Further, the proposed complaint added a cause of action for defamation “based upon spreading to others the reason for the discharge.” (Id. at p. 965-966.) The trial court refused to allow the amendments to the complaint and granted the summary judgment motion.

The Second District Court of Appeal held that the trial court abused its discretion to refuse the request to amend the complaint. The Court of Appeal concluded that the facts in both the original and amended complaints “all related to [the executive’s] discharge.” So, the amended complaint came within the same general set of facts test which California courts use to determine whether amendments relate back to an earlier complaint. (Id. at p. 965-967.) The Court of Appeal reasoned that the proposed amendments were a “continuation of the events asserted in the initial pleading.” The proposed amendments “finished telling the story begun in the original complaint.” (Id. at p 966.) The Court of Appeal also noted that all the injuries alleged in the proposed amended complaint, including the new cause of action, were to be “expected” from the wrongful discharge alleged.

Here, like in Honig, the proposed amendments incorporate additional bad acts that Defendants—including proposed new Defendants Ben Naim and Joseph Cohen—allegedly committed in furtherance of their scheme to improperly seize control of Nessah. Given that these proposed amendments are a “continuation of the events asserted in the initial pleading” and contribute to the “story begun in the original complaint,” leave to amend is proper here. This is especially true given that unlike in Honig, where leave to amend was sought two years into litigation, this case is in its infancy.

“Th[e] statutory provision giving the courts the power to permit amendments in furtherance of justice has received a very liberal interpretation by the courts of this state.” (Klopstock v. Superior Court (1941) Cal.2d 13, 19. The policy favoring leave to amend is so strong that it is an abuse of discretion to deny an amendment unless the adverse party can show meaningful prejudice, such as the running of the statute of limitations, trial delay, the loss of critical evidence, or added preparation costs. (Atkinson v. Elk Corp. (2003) 109 Cal.App.4th 739, 761.

Based on the foregoing, Plaintiff’s motion for leave to amend is granted.

It is so ordered.

Dated: October , 2022

Hon. Jon R. Takasugi Judge of the Superior Court

Parties who intend to submit on this tentative must send an email to the court at smcdept17@lacourt.org by 4 p.m. the day prior as directed by the instructions provided on the court website at www.lacourt.org. If a party submits on the tentative, the party’s email must include the case number and must identify the party submitting on the tentative. If all parties to a motion submit, the court will adopt this tentative as the final order. If the department does not receive an email indicating the parties are submitting on the tentative and there are no appearances at the hearing, the motion may be placed off calendar.

Due to Covid-19, the court is strongly discouraging in-person appearances. Parties, counsel, and court reporters present are subject to temperature checks and health inquiries, and will be denied entry if admission could create a public health risk. The court encourages the parties wishing to argue to appear via L.A. Court Connect. For more information, please contact the court clerk at (213) 633-0517. Your understanding during these difficult times is appreciated.