Manlin v. Milner
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In a dispute between members of a limited liability company (LLC), Plaintiff alleged that the LLC’s managing member engaged in self-dealing to the detriment of both Plaintiff and the company. After the managing member, represented by the LLC’s attorneys, cross-complained against Plaintiff, Plaintiff cross-complained against both the managing member and the attorneys for further self-dealing and breach of fiduciary duty, alleging they misappropriated funds from the LLC to finance the litigation. Cross-defendants specially moved to strike the complaint under the anti-SLAPP statute (Strategic Lawsuit Against Protected Activity; Code of Civil Procedure section 425) arguing the alleged conduct occurred as part of the litigation, which was protected activity.
The Second Appellate District affirmed the order imposing monetary sanctions. The court denied the other discovery orders deeming it a petition for extraordinary relief. The court affirmed the anti-SLAPP order striking Plaintiff’s cross-complaint. Further, the court directed the trial court to vacate its order awarding Defendant anti-SLAPP attorney fees and reconsider that order. The court explained that the trial court was in the best position to evaluate Plaintiff’s justifications for deficient responses, and as with the December 9, 2019 order, the court explained it cannot conclude that the trial court’s findings and decision on April 6, 2021, to impose additional monetary sanctions constituted a manifest abuse exceeding the bounds of reason.
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