Ultimate Action v. Pacific City Bank CA2/4

INTRODUCTION

Here we hold that a cross-complaint filed in response to the plaintiff’s complaint attacking the validity of a loan agreement does not fall within the provisions of a strategic lawsuit against public participation (SLAPP). (Code Civ. Proc., § 425.16.)1 The majority shareholder in a company filed an individual and derivative action attacking the validity of a loan agreement between the company and a bank. The bank responded by filing a cross-complaint against the majority shareholder and the company, seeking a judicial determination of the validity of the agreement, or, alternatively, an equitable lien against the company’s real property. The shareholder filed a special motion to strike under our anti-SLAPP statute, arguing the bank’s causes of action all arose from the shareholder’s protected activity of filing the derivative action. The shareholder now appeals the trial court’s denial of its motion to strike the bank’s cross-complaint. We affirm.

FACTUAL AND PROCEDURAL BACKGROUND

A. Ultimate Action’s Pleadings Plaintiff and appellant Ultimate Action, LLC (Ultimate Action) owns a 60 percent interest in 357 South Broadway, LLC (the Company). On July 21, 2021,…