Metropolitan News-Enterprise

 

Wednesday, February 17, 2021

 

Page 1

 

Court of Appeal:

Threat to Contact State Bar for Help Wasn’t ‘Extortion’

Letter to Lawyer Demanding Refund of $300,000 in Fees, Saying That ‘Assistance’ of State Bar Would Otherwise Be Sought, Could Mean That Fee Arbitration Services Would Be Requested, Opinion Says

 

By a MetNews Staff Writer

 

Threatening to enlist the aid of the State Bar in recouping an over-payment of attorney fees is not extortion, Div. Four of the Court of Appeal for this district held yesterday in an opinion reversing an order denying an anti-SLAPP motion.

The opinion by Justice Thomas L. Willhite Jr., which was not certified for publication, orders the granting of a special motion to strike, pursuant to Code of Civil Procedure §425.16, brought by intellectual property attorney Tommy Songfong Wang and his City of Industry law firm.

They were sued on Sept. 25, 2019 by San Gabriel attorney Long Z Liu for civil extortion and unfair competition based on a Sept. 12 demand letter on behalf of Malinzhu Jia, a client of Wang who was previously represented by Liu.

Wording of Letter

In that letter, Wang noted “that over $350,000.00 in attorney’s fees was charged for a case that never got further than an initial demurrer,” and said:

“While our Client is entitled to much more, without wasting more time and resources and in the interest of resolving this matter amicably, our Client is willing to accept a return of $300,000.00 of the inflated fees she was billed for by [Liu’s] firm. Our Client looks forward to receiving the requested refund no later than Monday, September 23, 2019.

“Should you fail to remit the requested refund to our Client, our Client will be forced to seek the assistance of the California State Bar to recover all fees and costs incurred….”

That letter, Liu asserted, violates California Rules of Professional Conduct, rule 3.10(a) which provides:

“A lawyer shall not threaten to present…administrative, or disciplinary charges to obtain an advantage in a civil dispute.”

Los Angeles Superior Court Judge Gloria White-Brown agreed, holding that, although the letter related to prospective litigation—which would ordinarily be protected speech—it was extortive and was therefore unshielded.

Willhite’s Opinion

In his opinion reversing her order, Willhite said:

“Wang’s letter threatens only that, if Liu failed to remit the requested refund, his former client (Jia) would ‘be forced to seek the assistance of the California State Bar.’ True, the letter does not explicitly state Jia intended to initiate mandatory fee arbitration through the State Bar if Liu failed to comply with the demand.  However, the letter also contains no explicit or implicit threat that Jia planned to initiate disciplinary action against Liu by filing a State Bar ‘complaint’ if he failed to satisfy the settlement demand. To the extent two inferences may reasonably be drawn from Wang’s letter, the trial court was obligated to draw an inference in favor of Wang’s contention that Jia contemplated seeking assistance from the State Bar’s fee arbitration program, leading for the second step the opportunity for Liu to show otherwise.”

(The State Bar conducts fee mediation only in counties where the local bar has no such program.)

Where the first prong of the anti-SLAPP motion is met—a showing that the conduct complained of arose from protected activity—the second prong is addressed: whether the plaintiff can show a reasonable probability of prevailing on the merits. White-Brown did not reach that step.

Second Prong

Rather than remanding the matter for a determination by the trial court as to whether the second prong is met, Willhite performed that task, saying:

“Liu cannot establish a probability of prevailing on his claims for civil extortion or unfair competition as he has not shown Wang made any illegal or improper “threat.” Notwithstanding Liu’s self-serving declaration to the contrary, the demand letter contains no such threat, nor does it imply that Jia would initiate a State Bar disciplinary action against Liu.”

He went on to remark:

“Liu’s complaint alleges that Wang’s ‘letter warned that if [Liu] failed to pay $300,000 by September 23, 2019, Jia would be forced to file a California State Bar complaint against [Liu].’ The letter says nothing of the kind and does not threaten discipline or public disgrace.  Rather, it is a written communication offering to settle a fee dispute, which explains to the attorney Jia’s legitimate concerns about fees charged and the steps she intends to take if the settlement offer is rejected. Liu’s allegations and self-serving characterization of the contents of the letter are not evidence, and he may not re-write the letter to suit his purposes.”

The jurist said no cause of action lies under the Unfair Competition Law, Business and Professions Code §17200 et seq. He said there is no basis for restitution or injunctive relief, the remedies authorized by the UCL, and in any event, the litigation privilege pertains.

The case is Liu v. Wang, B303323.

Wang and his firm were represented by Glendale attorney James I. Ham and Second Walter Whitman Moore of the Beverly Hills firm of Licensed to Sue. Casio Shyn, a Thousand Oaks practitioner, and by Abraham S. Odabachian of Liu’s firm.

 

Copyright 2021, Metropolitan News Company