Sourdough & Co. v. GSD Foods CA3

Filed 6/7/22 Sourdough & Co. v. GSD Foods CA3 NOT TO BE PUBLISHED California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA THIRD APPELLATE DISTRICT (Sacramento) ----

SOURDOUGH & CO., INC., et al., C092935

Cross-complainants and Respondents, (Super. Ct. No. 34-2020- 00278298-CU-BT-GDS) v.

GSD FOODS, INC., et al.,

Cross-defendants and Appellants.

This case arises out of a business dispute between several parties to licensing agreements to operate sandwich restaurants under the trademark “Sourdough & Co.” We are presented with the question of whether a cause of action for fraud and deceit, raised in a cross-complaint, is subject to an anti-SLAPP motion under Code of Civil Procedure

1

section 425.16.1 The trial court denied the anti-SLAPP motion filed by GSD Foods, Inc., Davinder Singh, Powerglide Holdings, LLC, Kaldeep Uppal, and SD-Folsom, Inc. (collectively GSD) to strike the cause of action for fraud and deceit in a cross-complaint filed by Sourdough & Co, Inc., SFSE of EDH, Inc., Lowell Steven Presson, R. Gordon Ross, and David Bagley (collectively Sourdough). The trial court reasoned that the claim for fraud and deceit related to statements inducing Sourdough to enter the agreements rather than to any protected activity related to the right of access to the courts. On appeal, GSD contends (1) the cause of action for fraud and deceit relates to protected activity because the claim focuses on GSD’s litigation position, (2) Sourdough did not show a probability of prevailing on its fraud and deceit claim, and (3) GSD should be awarded its attorney fees because it should have prevailed on the anti-SLAPP motion. We conclude that the trial court properly denied the anti-SLAPP motion. The cause of action for fraud and deceit relates to the making of agreements between the parties rather than to the subsequent litigation. Having concluded that GSD did not meet its burden to show that the claim arose out of protected activity, we do not need to consider the second prong of the anti-SLAPP analysis – namely whether Sourdough demonstrated a probability of prevailing on its claim. We also do not need to consider GSD’s claim that it should have received attorney fees based on its contention that it should have prevailed on the anti-SLAPP motion. Accordingly, we affirm.