Golden State Seafood, Inc. v. Jamie R. Schloss

Golden State Seafood filed an action for malicious

prosecution and unfair business competition against William

Cohen (Cohen) and his attorney appellant Jamie R. Schloss

(Schloss). The complaint alleged Schloss filed a prior lawsuit

against Golden State Seafood on behalf of his client Cohen,

knowing he lacked probable cause to bring the action. Golden

State Seafood also alleged Schloss maliciously refused to dismiss

the prior action and engaged in unfair business practices.

Schloss filed an anti-SLAPP motion. The trial court denied

the motion because Golden State Seafood demonstrated a

likelihood of success on the merits of its claims, thereby

satisfying the second prong of the anti-SLAPP test. Schloss filed

a motion for reconsideration. That motion was also denied.

Schloss now appeals the orders denying his two motions.

We affirm both orders.

FACTUAL AND PROCEDURAL BACKGROUND

A. Relevant Factual Background

Golden States Seafood (GSS) is a wholesale seafood

distributor based in downtown Los Angeles. On August 19, 2015,

GSS was making a delivery to Bellaj Banquet Hall (Bellaj) in

Burbank. While making the delivery, the GSS truck driver

parked in a space reserved for drivers with valid handicap

placards on display. At that point, William Cohen parked his car

and confronted the GSS driver for parking improperly. He

“pulled out a camera and began taking photographs” while the

GSS driver apologized and moved the delivery truck.

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Cohen contacted GSS, demanding personal financial

compensation because its driver had improperly parked in the

handicap parking spot. GSS did not offer compensation.

Cohen, represented by attorney Schloss, then filed a

lawsuit against GSS, alleging violations of: 1) the Unruh Act

(Civ. Code, § 51 et seq.) premised upon a violation of the

Americans with Disabilities Act of 1990 (ADA); and 2) the

California Disabled Persons Act (DPA) (Civ. Code, § 54 et seq.).

On May 23, 2017, when trial by jury commenced, Cohen’s

evidence unfolded in an unexpected way. In his complaint,

Cohen had initially alleged a denial of access to goods and

services at Bellaj. His complaint read: “On Wednesday August

19, 2015 at approximately 3:30 p.m., William Cohen was trying to

eat at the Bellaj Banquet Hall . . . but was prevented from doing

so because he could not park in the handicapped parking space.”

However, at trial, Cohen testified he was actually seeking and

was denied access to the 7-11 convenience store located adjacent

to the Bellaj because he needed to get a drink as he felt

dehydrated. Similarly, Schloss represented to the jury that

Cohen was denied access to the nearby 7-11 store, as opposed to

Bellaj.

Also unusual was that Cohen presented no documentary

evidence at trial that he had a valid handicap placard at the time

of the incident at Bellaj, a placard he needed to display to park

legally in the space blocked by the GSS driver. (The record on

appeal does not include a complete transcript of Cohen’s oral

testimony; all we have is Schloss’s post-trial declaration that

Cohen testified he had been issued a valid placard, but had lost

the receipt showing when it went into effect.) Thus, at trial,

Cohen proved, at most, that the GSS driver committed a parking

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violation when he parked his truck in a space reserved for

vehicles displaying handicap placards. For its part and in

response to the allegations in the operative complaint, GSS

presented evidence that Bellaj was not open for business on the

day in question, casting doubt on Cohen’s story as pled in the

complaint. On May 24, 2017, the jury returned a verdict in favor

of GSS. The jury found Cohen was not disabled at the time of the

alleged incident.

B. GSS’s Subsequent Civil Complaint

One year later, on May 24, 2018, GSS filed a civil complaint

against Cohen and Schloss, seeking damages, injunctive relief,

and attorney fees and costs. The complaint alleged three causes

of action: 1) wrongful use of civil proceedings (against Cohen

alone); 2) malicious prosecution (against Cohen and Schloss); and

3) violation of Business and Professions Code section 17200 et

seq. (against Schloss alone).

We do not discuss the first cause of action filed solely

against Cohen because he is not a party to this appeal. As to the

second cause of action for malicious prosecution, GSS alleged

Cohen and Schloss (collectively defendants) knowingly filed a

“meritless and malicious lawsuit” that was based on “fabricated

facts and a non-cognizable legal theory.”

The GSS complaint alleged no reasonable attorney would

have filed the parking case, but Schloss did so knowing he could

not prove GSS had violated the Unruh Act or the DPA. GSS

alleged defendants’ parking case had “absolutely no merit” in

that 1) defendants both knew there is no private right to enforce

parking violations; 2) defendants did not have standing to

privately prosecute a motor vehicle violation; 3) the facility Cohen

visited was owned and operated by Bellaj, not GSS; 4) Bellaj was

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not open for business at the time of the incident; 5) GSS did not

operate or own any facility that denied access to Cohen; and 6)

Cohen was neither disabled nor handicapped on the date of the

incident.

The complaint further alleged defendants continued to

proceed with litigation “despite being informed of the reasons

why no reasonable attorney would bring such allegations on the

alleged facts” and after the trial court denied their ADA claims.

GSS alleged defendants “perpetrated this precise scheme on at

least one other occasion in an attempt to extort money from

another company making a delivery. Considering [Cohen]’s own

testimony that he has filed approximately twenty (20) ADA cases,

(where he is often represented by [Schloss]), . . . [Cohen] in

essence makes income prosecuting ADA cases.”

1

GSS alleged Cohen and Schloss, for the first time at trial,

claimed Cohen was trying to access the 7-11 rather than Bellaj.

“By changing the allegation at such a late date, . . . [Cohen] and

[Schloss] knew that [Cohen] was never actually denied access to

either [Bellaj] (which was not open), or 7-11 (which he could have

freely entered).”

The third cause of action alleged Schloss engaged in unfair

competition in violation of Business and Professions Code section

17200 et seq., in that Schloss, a licensed attorney, has earned

1 The complaint refers to Los Angeles Superior Court case

No. BC631960, filed by defendants against Carole & Jan’s

Moving Company. It alleges the complaint defendants filed

against GSS included language “leftover” from defendants’ case

against Carole & Jan’s Moving Company. According to GSS, the

alleged facts are “nearly identical,” involving a delivery truck

parked in a handicap parking space.

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income in the past several years by filing nearly 20 ADA

lawsuits. He and Cohen have a contractual relationship where

Schloss is retained to prosecute “meritless legal lawsuits” based

on alleged ADA and Unruh Act violations against persons and

entities for improperly parking in handicap spaces. GSS sought

attorney fees and injunctive relief to enjoin defendants from

further engaging in such litigation.

C. Special Motion to Strike the Complaint

Schloss entered a general denial, and on August 30, 2018,

filed a special motion to strike GSS’s complaint as a strategic

lawsuit against public participation under the anti-SLAPP

statute, Code of Civil Procedure section 425.16.2

On October 16, 2018, the trial court issued an order

denying Schloss’s special motion to strike in its entirety. In doing

so, the trial court issued an extensive ruling discussing the many

bases upon which it found GSS would likely be successful in

prevailing on the merits of both claims.

D. Motion for Reconsideration

Ten days later, on October 26, 2018, Schloss filed a motion

requesting the court to reconsider its denial of his anti-SLAPP

motion because of new evidence—namely, a record from the

Department of Motor Vehicles (DMV) showing Cohen was issued

a disabled parking placard prior to the August 19, 2015 incident.

He contends Cohen’s causes of action were thus factually and

2 All further undesignated statutory references are to the

Code of Civil Procedure, unless otherwise indicated.

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legally viable, and GSS had not shown any evidence of malice or

credible evidence establishing a lack of probable cause.

At the hearing on the motion for reconsideration, the trial

court found Schloss did “not present new facts, circumstances or

law to warrant reconsideration of the denial of the anti-SLAPP

motion, as required by CCP § 1008(a).” The DMV record

(purportedly indicating Cohen had a valid handicap placard at

the time of the incident) “was available when the anti-SLAPP

motion was heard, notwithstanding Schloss’ assertion that it took

5 hours to obtain the Registration Information Request form and

that it was not worth the time and expense to obtain this

document for the trial” in Cohen’s initial lawsuit against GSS.

The court denied Schloss’s motion for reconsideration. In

doing so, the trial court expressly allowed GSS “to file a motion

for sanctions pursuant to CCP § 1008(d).”

On February 22, 2019, Schloss filed a notice of appeal from

the trial court’s denial of the anti-SLAPP motion and denial of

the motion for reconsideration.

DISCUSSION

A. Applicable Law

Section 425.16 provides, inter alia, that “[a] cause of action

against a person arising from any act of that person in

furtherance of the person’s right of petition or free speech under

the United States Constitution or the California Constitution in

connection with a public issue shall be subject to a special motion

to strike, unless the court determines that the plaintiff has

established that there is a probability that the plaintiff will

prevail on the claim.” (§ 425.16, subd. (b)(1).) An “ ‘act in

furtherance of a person’s right of petition or free speech . . . in

connection with a public issue’ ” is defined in section 425.16 to

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include, in relevant part: “any written or oral statement or

writing made before a legislative, executive, or judicial

proceeding, or any other official proceeding authorized by law,”

and “any other conduct in furtherance of the exercise of the

constitutional right of petition or the constitutional right of free

speech in connection with a public issue or an issue of public

interest.” (Id., subd. (e).)

The Legislature enacted section 425.16 to prevent and

deter “lawsuits brought primarily to chill the valid exercise of the

constitutional rights of freedom of speech and petition for the

redress of grievances.” (§ 425.16, subd. (a).) Thus, the purpose of

the anti-SLAPP law is “not [to] insulate defendants from any

liability for claims arising from the protected rights of petition or

speech. It only provides a procedure for weeding out, at an early

stage, meritless claims arising from protected activity.” (Baral v.

Schnitt (2016) 1 Cal.5th 376, 384 (Baral).)

When a party moves to strike a cause of action under the

anti-SLAPP law, a trial court evaluates the special motion to

strike using a two-prong test: (1) has the moving party “made a

threshold showing that the challenged cause of action arises from

protected activity” (Rusheen v. Cohen (2006) 37 Cal.4th 1048,

1056); and, if so, (2) has the non-moving party demonstrated that

the challenged cause of action has “ ‘minimal merit’ ” by making

“a prima facie factual showing sufficient to sustain” a judgment

in its favor? (Baral, supra, 1 Cal.5th at pp. 384–385; Navellier v.

Sletten (2002) 29 Cal.4th 82, 93–94; see also § 425.16, subd.

(b)(1)). After the first prong is satisfied by the moving party, the

burden shifts to the non-moving party to “demonstrate that each

challenged claim based on protected activity is legally sufficient

and factually substantiated.” (Baral, at p. 396.) If the plaintiff

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can show a probability of prevailing on any part of its claim, the

cause of action is not meritless and will not be stricken. (Oasis

West Realty, LLC v. Goldman (2011) 51 Cal.4th 811, 820.)

B. Standard of Review

We review a trial court’s ruling on a special motion to

strike pursuant to section 425.16 under the de novo standard.

(Monster Energy Co. v. Schechter (2019) 7 Cal.5th 781, 788;

Park v. Board of Trustees of California State University (2017)

2 Cal.5th 1057, 1067 (Park).) “In other words, we employ the

same two-pronged procedure as the trial court in determining

whether the anti-SLAPP motion was properly granted.”

(Mendoza v. ADP Screening & Selection Services, Inc. (2010)

182 Cal.App.4th 1644, 1652.)

We consider “the pleadings, and supporting and opposing

affidavits stating the facts upon which the liability or defense is

based.” (§ 425.16, subd. (b)(2).) In considering the pleadings and

declarations, we do not make credibility determinations or

compare the weight of the evidence; instead, we accept the

opposing party’s evidence as true and evaluate the moving party’s

evidence only to determine if it has defeated the opposing party’s

evidence as a matter of law. (Soukup v. Law Offices of Herbert

Hafif (2006) 39 Cal.4th 260, 269, fn. 3 (Soukup).) Where a

complaint identifies a number of acts of alleged misconduct and

theories of recovery, for purposes of reviewing an anti-SLAPP

motion, it is sufficient to focus on just one. (Oasis West Realty,

LLC v. Goldman, supra, 51 Cal.4th at p. 821.)

C. Prong 1: Arising from Protected Activity

Schloss’s initial burden is to show that the two causes of

action in GSS’s complaint against Schloss arise from protected

activity. (Park, supra, 2 Cal.5th at p. 1061.)

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GSS’s malicious prosecution and unfair business

competition (Bus. & Prof. Code, § 17200 et seq.) causes of action

are based on conduct that is protected activity—i.e., the filing of

complaints against GSS and others for alleged violations of the

Unruh Act, DPA, and ADA. This is protected activity. (See

Birkner v. Lam (2007) 156 Cal.App.4th 275, 281 [“ ‘[t]he

constitutional right to petition . . . includes the basic act of filing

litigation or otherwise seeking administrative action’ ”]; City of

Colton v. Singletary (2012) 206 Cal.App.4th 751, 766 (Colton)

[same]; Jarrow Formulas, Inc. v. LaMarche (2003) 31 Cal.4th

728, 734–736 [complaint for malicious prosecution arises out of

act in furtherance of right of free speech or petition under section

425.16].)

D. Prong 2: Probability of Prevailing on the Merits

The second prong of the anti-SLAPP analysis requires GSS

to show a probability of prevailing on its causes of action. We

reiterate the court does not weigh evidence or resolve conflicting

factual claims. Its inquiry is limited to whether plaintiff has

stated a legally sufficient claim and made a prima facie factual

showing sufficient to sustain a favorable judgment. The court

accepts plaintiff’s evidence as true and evaluates defendant’s

showing only to determine if it defeats plaintiff’s claim as a

matter of law. (Baral, supra, 1 Cal.5th at p. 384–385; Wilson v.

Parker, Covert & Chidester (2002) 28 Cal.4th 811, 821 (Wilson).)

1. Analysis: Malicious Prosecution

To prevail on a malicious prosecution claim, plaintiff must

show the prior action (1) was commenced by or at the direction of

the defendant and was pursued to a legal termination favorable

to the plaintiff; (2) was brought without probable cause; and

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(3) was initiated with malice. (Soukup, supra, 39 Cal.4th at

p. 292.) “[A]n attorney may be held liable for malicious

prosecution for continuing to prosecute a lawsuit discovered to

lack probable cause.” (Zamos v. Stroud (2004) 32 Cal.4th

958, 970 (Zamos).)

“The question of probable cause is ‘whether, as an objective

matter, the prior action was legally tenable or not.’ [Citation.]

‘A litigant will lack probable cause for his action either if he relies

upon facts which he has no reasonable cause to believe to be true,

or if he seeks recovery upon a legal theory which is untenable

under the facts known to him.’ [Citation] ‘In a situation of

complete absence of supporting evidence, it cannot be adjudged

reasonable to prosecute a claim.’ ” (Soukup, supra, 39 Cal.4th at

p. 292.) Thus, “ ‘probable cause is lacking “when a prospective

plaintiff and counsel do not have evidence sufficient to uphold a

favorable judgment or information affording an inference that

such evidence can be obtained for trial.” ’ ” (Morrison v. Rudolph

(2002) 103 Cal.App.4th 506, 512, overruled in part on other

grounds in Zamos, supra, 32 Cal.4th at p. 973.)

The court must ‘‘ ‘ “make an objective determination of the

‘reasonableness’ of [defendant’s] conduct, i.e., to determine

whether, on the basis of the facts known to [defendant], the

institution [and prosecution] of the [lawsuit] was legally

tenable.” ’ ” (Zamos, supra, 32 Cal.4th at p. 971.) “ ‘The test

applied to determine whether a claim is tenable is “whether any

reasonable attorney would have thought the claim tenable.” ’ ”

(Ibid.)

“The ‘malice’ element of the malicious prosecution tort

relates to the subjective intent or purpose with which the

defendant acted in initiating the prior action.” (Sheldon Appel

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Co. v. Albert & Oliker (1989) 47 Cal.3d 863, 874.) “As an element

of malicious prosecution, malice ‘reflects the core function of the

tort, which is to secure compensation for harm inflicted by

misusing the judicial system, i.e., using it for something other

than to enforce legitimate rights and secure remedies to which

the claimant may tenably claim an entitlement.’ ” (Lanz v.

Goldstone (2015) 243 Cal.App.4th 441, 466–467.) “Malice ‘ “may

range anywhere from open hostility to indifference” ’; it is not

limited to ‘ “ill will toward plaintiff but exists when the

proceedings are [prosecuted] primarily for an improper

purpose.” ’ ” (Id. at p. 466.) “ ‘Malice may also be inferred from

the facts establishing lack of probable cause’ ” (Soukup, supra,

39 Cal.4th at p. 292), and lack of probable cause is a factor in

considering whether the claim was prosecuted with malice.

(HMS Capital, Inc. v. Lawyers Title Co. (2004) 118 Cal.App.4th

204, 218.) “Since parties rarely admit an improper motive,

malice is usually proven by circumstantial evidence and

inferences drawn from the evidence.” (Ibid.)

GSS has met the first element of its malicious prosecution

claim, as Schloss prosecuted Cohen’s action against GSS which

concluded in a judgment in GSS’s favor.

As to the second element of probable cause, we find

sufficient evidence in the record that Schloss prosecuted, or at the

very least, continued to prosecute, Cohen’s lawsuit against GSS

knowing he lacked probable cause. This requires us to examine

what Cohen had to prove under the Unruh Act and DPA.

The Unruh Civil Rights Act, Civil Code sections 51

through 52, was enacted to “create and preserve a

nondiscriminatory environment in California business

establishments by ‘banishing’ or ‘eradicating’ arbitrary, invidious

13

discrimination by such establishments.” (Angelucci v. Century

Supper Club (2007) 41 Cal.4th 160, 167.) Civil Code section 51,

subdivision (f) incorporates the protections against

discrimination created by the Americans with Disability Act of

1990 (42 U.S.C. § 12101 et seq.) (ADA). It states: “ ‘A violation of

the right of any individual under the [federal ADA] shall also

constitute a violation of this section.’ ” (Flowers v. Prasad (2015)

238 Cal.App.4th 930, 937.) The ADA provides in pertinent part:

“No individual shall be discriminated against on the basis of

disability in the full and equal enjoyment of the goods, services,

facilities, privileges, advantages, or accommodations of any place

of public accommodation by any person who . . . operates a place

of public accommodation.” (42 U.S.C. § 12182(a).) The ADA

defines discrimination as “a failure to make reasonable

modifications in policies, practices, or procedures, when such

modifications are necessary to afford such goods, services,

facilities, privileges, advantages, or accommodations to

individuals with disabilities, unless the entity can demonstrate

that making such modifications would fundamentally alter the

nature of such goods, services, facilities privileges, advantages or

accommodations.” (42 U.S.C. § 12182(b)(2)(A)(ii); Baughman v.

Walt Disney World Co. (2013) 217 Cal.App.4th 1438, 1446.) As

our Supreme Court has held, there “is no indication that the

Legislature intended to broaden the scope of [Civil Code]

section 51 to include discriminations other than those made by a

‘business establishment’ in the course of furnishing goods,

services or facilities to its clients, patrons or customers.” (Alcorn

v. Anbro Engineering, Inc. (1970) 2 Cal.3d 493, 500.) This is in

accord with the actual language of the ADA which prohibits

14

discrimination by any person who “operates a place of public

accommodation.” (42 U.S.C. § 12182(a).)

The California Disabled Persons Act (Civ. Code, § 54 et

seq.) (DPA) “substantially overlaps with and complements the

Unruh Civil Rights Act.” (Jankey v. Lee (2012) 55 Cal.4th

1038, 1044.) The DPA guarantees people with disabilities equal

rights of access “to public places, buildings, facilities and services,

as well as common carriers, housing and places of public

accommodation.” (Munson v. Del Taco, Inc. (2009) 46 Cal.4th

661, 674, fn. 8.) The DPA incorporates the ADA, in that “[a]

violation of the right of an individual under the Americans with

Disabilities Act of 1990 . . . also constitutes a violation of this

section.” (Civ. Code, § 54, subd. (c).) Thus, an individual who is

“denied equal access” to a public place/facility/building, may bring

a cause of action under the DPA/ADA. “The phrase ‘denied equal

access’ necessarily implies that either the structure of the public

facility, or some policy of its operator, precluded equal access.”

(Urhausen v. Long Drugs Stores California, Inc. (2007)

155 Cal.App.4th 254, 263.)

Here, GSS was a wholesale seafood distributor. It did not

own or operate the Bellaj, the 7-11 convenience store, or any

business near the parking spot reserved for vehicles with

handicap placards. At best, its driver committed a Vehicle Code

violation by blocking the reserved space. This is not the type of

discrimination the Unruh Act, DPA, or ADA was intended to

remedy. (See 28 C.F.R. § 36.101(a) [The purpose of the ADA is to

prevent “discrimination on the basis of disability by covered

public accommodations and requires [said] places . . .to be

designed, constructed, and altered in compliance with

accessibility standards”].) As the trial court found, GSS is not a

15

“business establishment” subject to the statutes’ reach. Nor was

Cohen one of GSS’s “clients, patrons or customers” to whom it

was providing a good or service. (Alcorn v. Anbro Engineering,

Inc., supra, 2 Cal.3d at p. 500.) Filing suit against GSS for its

delivery driver’s parking error where, as here, GSS was not a

business establishment providing goods or services to Cohen,

establishes lack of probable cause to bring suit.

A second fact demonstrating the plain lack of probable

cause encompasses the cause of action under the DPA as well as

the Unruh Act claim. Schloss alleged GSS denied Cohen access

to public accommodations because Cohen could not park in the

reserved handicap space blocked by GSS’s driver. However,

Cohen omits a necessary fact he failed to prove at trial. The

handicap parking space was reserved by law for drivers who

displayed either a special identification license plate or a valid

handicap placard issued pursuant to Vehicle Code sections

22511.55 or 22511.59. (Veh. Code, § 22507.8, subd. (a).) Schloss

failed to prove at trial that his client had an unexpired placard or

license plate and that he had the placard or plate with him to

display so that he could legally park in the blocked space.

Indeed, Schloss later told the court that although his client had

the handicap placard, he “had lost the document showing when it

had been issued”; Schloss himself stated that Cohen had testified

to having also lost the “Placard Identification Card/Receipt” for

the placard expiring June 30, 2017. Schloss consciously decided

before trial “[it was] not worth spending a ½ day to a day of my

time tracking down a lost record.” It was Schloss’s deliberate

decision not to locate the proof he needed. Schloss’s statements

also suggest that if his client had lost the placard prior to trial,

the placard was not available to be displayed on the day of the

16

incident. In any event, without proof at trial that he was entitled

to legally park in the blocked space because he had a valid

handicap placard on display at the time of the incident, Cohen

could not prevail on his claim that he had been illegally denied

access to the Bellaj or the 7-11. Under the evidence presented,

Cohen had no tenable cause of action under the DPA. (Civ. Code,

§ 54.1, subd. (e) [“This section does not preclude the requirement

of the showing of a license plate or disabled placard when

required by enforcement units enforcing disabled persons parking

violations pursuant to Sections 22507.8 and 22511.8 of the

Vehicle Code.”].)

Moreover, even if GSS could in some way be held liable for

its driver’s actions, Cohen’s sudden change of story at trial is a

reasonable basis to infer that Cohen was not accessing goods or

services from anyone, let alone GSS, on the day in question.

Under the Unruh Act, Cohen had to show he was prevented from

accessing goods and services from some entity. Once it became

clear at trial that Bellaj was not open that day, Cohen changed

his story, pivoting to the 7-11 store. We find a jury might

reasonably conclude that Schloss, when he learned Bellaj was not

open, should have realized the complaint as pled, was untenable,

lacked probable cause, and should not have been prosecuted.

Schloss’s contention that he was entitled to rely on the

information and photographs supplied by his client does not

rescue him. While “the attorney is entitled to rely on information

provided by the client” (Morrison v. Rudolph, supra,

103 Cal.App.4th at pp. 512–513), once the lawyer discovered the

client’s statements are false, the lawyer cannot rely on such

statements in prosecuting an action. Schloss actively advocated

the changed story and abandoned the facts as pleaded in the

17

complaint. It is probable a jury could find Schloss knowingly

prosecuted a false claim.

We note Schloss places great importance on the fact that

before the jury returned its verdict for GSS in Cohen’s initial

action against GSS, the trial court had denied GSS’s directed

verdict motion. Schloss argues “denial of a directed verdict

[motion] defeats a later malicious prosecution action” and the

trial judge’s decision “is conclusive.” We disagree. We make our

determination as to whether GSS has a probability of prevailing

on its malicious prosecution claim on our own review of the record

de novo.

Schloss next argues probable cause is established by

applying the “interim adverse judgment” rule, in that the trial

court’s May 2017 interim ruling denying GSS’s motion for

directed verdict in Cohen’s initial action establishes Schloss had

probable cause in initiating and/or litigating his client’s claims

against GSS. Schloss then argues the fact that he had received a

favorable ruling in his other, prior case against Carole & Jan’s

Moving Company3 based on nearly identical alleged facts

“confirm[s] that the interim adverse judgment rule applies.”

The interim adverse judgment rule “concerns the probable

cause element of a malicious prosecution claim. In contrast to

the existence of malice—a question of fact regarding ‘the

subjective intent or purpose with which [a litigant] acted in’

prosecuting the underlying action—the existence of probable

cause is a question of law to be determined as an objective

matter.” (Parrish v. Latham & Watkins (2017) 3 Cal.5th

767, 776.) Our state Supreme Court has held that “if an action

3 See fn. 1, ante.

18

succeeds after a hearing on the merits, that success ordinarily

establishes the existence of probable cause (and thus forecloses a

later malicious prosecution suit), even if the result is overturned

on appeal or by later ruling of the trial court.” (Id. at p. 771,

italics added; see Wilson, supra, 28 Cal.4th at p. 817–818.) We

are surprised by and reject Schloss’s contention that his success

in litigating another case against another company (Carole &

Jan’s Moving Company) for a different incident with different

parties is grounds for application of the interim adverse

judgment rule in this unrelated case; that case has no bearing on

this case.

Similarly, we are not persuaded that a denial of a motion

for directed verdict equates to a judgment “on the merits.” We

reach that conclusion based on our reading of section 630,

subdivision (c), which provides: “If the motion [for directed

verdict] is granted, unless the court in its order directing entry of

the verdict specifies otherwise, it shall operate as an adjudication

upon the merits.” (§ 630, subd. (c), italics added.) Nowhere in

section 630 or any other authority provided by Schloss does it

state that a denial of a directed verdict motion amounts to an

adjudication on the merits. Further, we are not aware of any

authority where a court must apply the interim adverse

judgment rule to a denial of a motion for directed verdict.

Moreover, it is plain that when the trial court in the underlying

action denied the motion for a directed verdict, it did so “at this

time,” expressly stating counsel could raise the issues again on

the merits after trial if necessary, via a motion for judgment

notwithstanding the verdict. The trial court wanted the case to

go to the jury before it weighed in. Given the trial court’s

comments, that ruling does not and cannot inoculate the

19

malicious prosecution claim against a finding of lack of probable

cause.

We also find it important to note that while Schloss urges

us to apply the interim adverse judgment rule to the directed

verdict motion, he failed to include a copy of said motion, and any

opposition or reply papers as part of the record on appeal. This

precludes us from completing our analysis regarding the interim

adverse judgment rule, as we have no way of further checking

whether “the initial victory in the prior action—i.e., the denial of

the [directed verdict motion]—‘was induced by materially false

facts submitted in opposition’ to the motion. [Citation.] That is

because, ‘if denial of [the motion] was induced by materially false

facts submitted in opposition, equating denial with probable

cause might be wrong. [The directed verdict motion] might have

been granted but for the false evidence.’ ” (Kinsella v. Kinsella

(2020) 45 Cal.App.5th 442, 456.)

This, in turn, leads to the third element, malice. Malice

“can be inferred when a party continues to prosecute an action

after becoming aware that the action lacks probable cause.”

(Daniels v. Robbins (2010) 182 Cal.App.4th 204, 226.) However,

“ ‘lack of probable cause must be supplemented by other,

additional evidence.’ ” (Id. at p. 225.)

Here, the evidence suggests Schloss knowingly continued to

pursue the action after being advised by opposing counsel of the

defects in his case and after watching his client suddenly and

completely change material facts pled in the complaint.

Additional evidence supporting a finding of malice is Schloss’s

failure to prove at trial that his client indeed possessed and

displayed a valid handicap placard issued prior to the date of the

incident. The handicap placards and the placard identification

20

card receipts submitted to the court by Schloss/Cohen—prior to

those submitted as part of the reconsideration motion—indicated

Cohen had valid handicap placards from March 17, 2011 until

June 30, 2013; from March 19, 2013 until June 30, 2015; and one

that expired on June 30, 2017. While the earlier two placards

included their respective identification card receipts specifying

the date on which each placard was issued, the placard that

expired on June 30, 2017 did not contain its respective

identification card receipt (or any DMV documentation or

certificate), making it impossible for the trier of fact to determine

whether the placard Cohen possessed was issued prior to (and

thus was effective on) the date of the incident.

Schloss argues “[s]imply not being in possession of the

certificate is not enough to show that Cohen’s claim was ‘totally

and completely’ without merit.” We disagree. To knowingly

proceed to trial on a claim requiring proof of entitlement to use

the space reserved only for valid placard-displaying vehicles

without securing proof that Cohen had a placard in effect at the

time of the incident is akin to continuing with an action after one

discovers it is baseless. It is an additional fact supporting a

finding of malice. The first time the court was provided evidence

that Cohen’s placard (with the expiration date of June 30, 2017)

was issued by the DMV on February 27, 2015, and in effect on

the date of the August 19, 2015 incident was via Schloss’s

October 2018 motion for reconsideration of the denial of his antiSLAPP motion—nearly a year and a half after trial commenced

in Cohen’s/Schloss’s initial action against GSS.

Based on the foregoing, we conclude GSS has satisfied the

second prong of the anti-SLAPP test.

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2. Violation of Business and Professions Code Section

17200 et seq.

Business and Professions Code section 17200 provides: “As

used in this chapter, unfair competition shall mean and include

any unlawful, unfair or fraudulent business act or practice and

unfair, deceptive, untrue or misleading advertising and any act

prohibited by Chapter 1 (commencing with Section 17500) of Part

3 of Division 7 of the Business and Professions Code.” As the

California Supreme Court has stated, “[t]he Legislature intended

this ‘sweeping language’ to include ‘ “anything that can properly

be called a business practice and that at the same time is

forbidden by law.” ’ ” (Bank of the West v. Superior Court (1992)

2 Cal.4th 1254, 1266.) This code section thus “ ‘borrows’

violations from other laws by making them independently

actionable as unfair competitive practices.” (Korea Supply Co. v.

Lockheed Martin Corp. (2003) 29 Cal.4th 1134, 1143; Colton,

supra, 206 Cal.App.4th at p. 770.)

Knowingly filing or pursuing unmeritorious legal actions

that are not factually or legally tenable, for the purpose of

earning income, qualifies as an unfair business practice. We

have already found GSS has made a prima facie showing a

likelihood of success on its malicious prosecution claim. GSS

alleges another example of Cohen and Schloss initiating a “nearly

identical” action against a delivery truck parking similarly

parking in a reserved handicapped space.4 GSS argues Schloss’s

business practice “appears to consist of utilizing Cohen in order

to initiate litigation against companies whose delivery persons

4 See fn. 1, ante.

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park in handicapped spots.” GSS refers to Schloss’s behavior as

part of a “ ‘legal shakedown scheme’ ” based on an abuse of the

Unruh Act, similar to abuse of the unfair competition law. We

are persuaded these facts and this legal theory have merit,

especially given our findings and decision in the preceding section

as to the malicious prosecution cause of action.

Based on the foregoing, we find GSS has met its burden of

showing a probability of prevailing on the merits of its cause of

action for unfair business practices.

E. Motion for Reconsideration

In his notice of appeal filed February 22, 2019, Schloss

indicated he was appealing from: 1) the court’s October 16, 2018

order denying his special motion to strike GSS’s complaint, and

2) the court’s January 23, 2019 order denying his motion

for reconsideration.

On appeal, Schloss raises no argument about the trial

court’s denial of the motion for reconsideration nor does he

identify a challenge to the trial court’s ruling in a “separate

argument heading” in his brief. (Roe v. McDonald’s Corp. (2005)

129 Cal.App.4th 1107, 1114.) We thus treat his contention as

waived. (Ivanoff v. Bank of America, N.A. (2017) 9 Cal.App.5th

719, 729, fn. 1.; In re Marriage of Falcone & Fyke (2008)

164 Cal.App.4th 814, 830 [“[t]he absence of cogent legal argument

or citation to authority allows this court to treat the contentions

as waived”].)

The trial court’s denial of the anti-SLAPP motion is affirmed. The trial court’s denial of the motion for reconsideration is affirmed. Respondent Golden State Seafood, Inc., is awarded costs on appeal.