LOS ANGELES (Legal Newsline) - A lawyer who sued another firm for interfering with his fee agreement with a former client was properly blocked from proceeding under California’s anti-SLAPP law, an appeals court ruled.
Richard Pech sued Stephen M. Doniger and Scott Alan Burroughs after his former client, Afshin Moghavem and his Prodigy Brands, decided against a lawsuit against Dollar Shave for which Moghavem had initially hired Pech to investigate.
Doniger and Burroughs moved to strike the lawsuit under the anti-SLAPP law (for Strategic Lawsuits Against Public Participation), which allows courts to strike legal claims that are considered protected activity including petitioning the government and engaging in litigation. Moghavem filed his own anti-SLAPP, which California’s Second Appellate District, Division Five, upheld except for a claim of breach of contract.
The same appeals court, in a follow-up action, held the anti-SLAPP law protected Moghavem’s lawyers in a Feb. 18 decision.
Pech said Moghavem hired him in 2019 to investigate suing Dollar Shave and Unilever under a contingency fee contract granting him 15% to 45% of any winnings. After considerable work on the case, he presented his clients with a proposed lawsuit, but Moghavem decided not to file it.
According to Pech, Moghavem said the complaint placed him in “jeopardy” and was “very aggressive.” Moghavem said he wanted to “evaluate the matter” and “did not want this risk at this time,” Pech said, although the lawyer suspected Moghavem actually was negotiating a settlement and didn’t want to share it with Pech.
Moghavem hired Doniger and Burroughs instead, and they later filed a suit Pech claims was partially based on his work. He sued for interference with his contract and in August 2020, Doniger and Burroughs filed their anti-SLAPP motion to strike all the claims.
Moghavem told Pech he had the fee agreement “reviewed by other lawyers” and knew his rights about ending the relationship, which Pech argued meant Doniger and Burroughs knew about and intended to disrupt the fee agreement. In a May 2020 letter to Pech, Doniger said he represented Moghavem’s company in pending litigation against Dollar Shave and said, “I understand that you had initially been retained to work on the case before the client decided to switch counsel and instead pursue it with my office (as is its absolute right).”
Moghavem and his lawyers said they repeatedly offered to pay Pech for his time on the case, but he refused to send a bill.
The trial court granted the anti-SLAPP motion in November 2020, reasoning that since filing a complaint is protected petitioning activity, an attorney’s instruction not to file a complaint furthers the right to petition.
The appeals court agreed, saying there was no settlement triggering the contingency fee agreement so no loss to Pech.