Opinion
B227709
08-17-2011
CALIBRA PICTURES, LLC, Plaintiff and Appellant, v. VARIETY, Defendant and Respondent.
Law Offices of Timothy D. McGonigle and Timothy D. McGonigle for Plaintiff and Appellant. Epstein Becker & Green, David Jacobs, Paul C. Burkholder and Lauren K. Rifenbark, for Defendant and Respondent.
NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS
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 This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.
(Los Angeles County Super. Ct. No. BC433320)
APPEAL from an order of the Superior Court of Los Angeles County. Richard Edward Rico, Judge. Affirmed with directions.
Law Offices of Timothy D. McGonigle and Timothy D. McGonigle for Plaintiff and Appellant.
Epstein Becker & Green, David Jacobs, Paul C. Burkholder and Lauren K. Rifenbark, for Defendant and Respondent.
Calibra Pictures, LLC (Calibra) appeals from the order granting the anti-SLAPPmotion filed by respondent Variety and awarding attorney fees. Upon review of the record, we find no error and affirm.
An anti-SLAPP motion is a special motion to strike authorized by Code of Civil Procedure section 425.16. It is designed to help defendants oppose SLAPP suits. The acronym SLAPP refers to a strategic lawsuit against public participation. (Rusheen v. Cohen (2006) 37 Cal.4th 1048, 1055-1056.)
All further statutory references are to the Code of Civil Procedures unless otherwise indicated.
FACTS
Variety; custom in the film industry
Variety is an entertainment-trade magazine. It was founded in 1905 with the mandate to keep a complete separation between the advertising and editorial departments. Timothy M. Gray (Gray) was promoted to Variety Group Editor in April 2009 and has adhered to the mandate. Advertising money is not a factor in choosing what films Variety reviews or how they are reviewed.
Every year, Variety reviews about 1,200 films. To be reviewed, a film must meet one of two criteria: either it is playing for paid admission, or it is being screened for the public, such as at a film festival. It is customary in the industry, however, for the media to refrain from publishing a review until a review date is established by the studio or independent distributor. Publicists typically want reviews to appear on or close to a film's opening date.
Calibra; the initial advertising buy with Variety
Calibra is a company managed by Joshua Newton (Newton). He wrote, directed and produced a film for Calibra called "Iron Cross." The film starred the late Roy Scheider. In the spring of 2009, Newton contacted Dawn Allen (Allen), the sales director at Variety, and explained that he was visiting from London, England and had come to Los Angeles to complete "Iron Cross" and find a distributor. He wanted to place a front cover advertisement in Variety to promote a Roy Scheider tribute at the Beverly Hills Hotel, and to attract attention to the film. The advertisement ran on March 23, 2009, at a cost of $45,000.
Roy Scheider died before filming was completed.
Variety's courtship of Calibra
The Roy Scheider tribute took place on April 4, 2009, and featured a screening of a trailer for the film. Allen was in attendance. She congratulated Newton on the trailer. A few days later, Allen wrote Newton an e-mail stating that "the trailer was amazing" and that she was excited for "Iron Cross" to come out. She offered to promote the film at the upcoming Cannes Film Festival. Newton declined the offer. Subsequently, Allen called Newton and invited him to attend the "Britweek" gala at the Beverly Wilshire Hotel on April 21, 2009, as the guest of Neil Stiles (Stiles), the president of Variety. Newton attended the gala with his girlfriend as well as his son Alexander, Roy Scheider's costar in "Iron Cross." They were seated with Stiles. He told Newton that Variety was the leading trade paper in the film industry, and due to overwhelming share of the market, it was not worth advertising with a competitor. Stiles emphasized that the readership of Variety covered all Academy Awards members, studios and decisionmakers in production and distribution. He asked if "Iron Cross" had a distributor and Newton said no. At that point, Stiles asked if Newton had considered entering "Iron Cross" into the 2010 Oscars. Newton indicated it was a possibility but that he would have to ask his investors when he returned to London. Stiles stated that if Calibra was to pursue the Oscars, Variety would be the perfect partner and it could help "Iron Cross" achieve an Oscar nomination.
After meeting with his investors, Newton e-mailed Allen and informed her that he had the green light to submit "Iron Cross" for the 2010 Academy Awards with the assistance of Variety. She e-mailed back and said she was pleased. A few weeks later, he telephoned Allen to say that it was unlikely that the film would be completed in time for the Oscar race. The following month, Allen telephone Newton and said Gray had published a short list of possible Academy Award contenders that included "Iron Cross." Newton later learned that Allen had asked Gray to include the film on the list. In August 2009, Variety published another list of possible Oscar contenders that included "Iron Cross" and indicated a fall release.
Allen sent Newton a Variety media pack entitled "Academy Season 2010." It included a Variety booklet that listed "Iron Cross" as a possible Oscar contender. An accompanying letter from Allen stated: "Let Variety be your 'Exclusive Media Partner.'" (Boldface omitted.) On September 7, 2009, Allen invited Newton to lunch at the Beverly Hills Hotel and excitedly stated that Gray had chosen to include "Iron Cross" in the exclusive Variety Screening Series. She stated that the cost was $25,000, and that the screening series was part of an overall exclusive partnership with Calibra for a promotional campaign to attract a distributor and nominations for the Academy Awards and the British Academy Awards (BAFTA) for the film's star, Roy Scheider. Newton explained that such an expensive undertaking could only be justified as a means of securing a major distribution deal for "Iron Cross." She assured Newton that if Calibra had the budget, Variety could create sufficient excitement about the film through a carefully designed Academy Awards campaign that the film would achieve the attention of major distributors. She also said that she would contact distributors directly and help Calibra obtain a distributor, but only if Calibra selected Variety as an exclusive media partner.
On September 30, 2009, Variety sent Newton a document entitled "Calibra Oscar Proposal" requesting in excess of $400,000 to be Calibra's exclusive media partner. Variety said it would help Calibra get Academy Awards recognition, and that it had contacted three awards consultants. The proposal included a combination of front covers in Weekly Variety and Daily Variety, ad strips in every issue and the insertion of 40,000 DVDs containing the film's trailer. In addition, Variety offered to sponsor screenings of the film in Los Angeles, New York and San Francisco as part of its Academy Awards screening series.
The parties' contract
On October 19, 2009, Allen sent Newton a proposal stating that she wanted "to confirm [Calibra's] REVISED Oscar campaign for 'Iron Cross' to run exclusively in Variety as follows:" (a) screening of the film at three theaters during the Variety screening series at a cost of $20,000; (b) print advertising (1) 50 strips (some daily, some weekly) for $104,450, (2) three front covers at $60,000 each for a total of $180,000, (3) two DVD inserts, one for $30,000 and the second for $70,000, and (4) additional charges of $70,000 for certain cover options and $7,500 for the cost of 6,000 reprints. The total cost was $427,500.
Newton signed the proposal.
The media campaign; completion of the film; the screenings
Starting in November 2009, Variety began running teaser strips and front covers advertising "Iron Cross." As a result, members of the Academy Awards, the Screen Actors Guild and BAFTA requested screener copies of the film. Allen told Newton that Variety was inundated with inquiries.
To qualify for the Academy Awards and fully exploit the exclusive partnership with Variety, Allen said that Calibra needed to finish the film and have it exhibited in a commercial movie theater for one week in December 2009. Based on that representation, Calibra spent $800,000 to expedite completion of the film. Newton worked 24 hours a day, seven days a week.
Between December 12, 2009, and December 20, 2009, "Iron Cross" was shown by Variety in exclusive Academy Awards screenings in Los Angeles, New York and San Francisco. Allen and another Variety representative attended the Los Angeles screening and told Newton the film was outstanding. By December 20, 2009, Calibra had paid Variety $226,000 under their contract.
Variety's negative review
Justin Chang, a film critic for Variety, assigned Robert Koehler (Koehler) to review "Iron Cross" at the Los Angeles screening. Koehler is a freelance film critic for Variety. Since 1999, he has written an average of 10 to 15 film reviews a month. Prior to the screening, Koehler did not know what his opinion of the film would be, or what he would write about it.
The review was published on December 20, 2009. The first paragraph stated: "'Iron Cross' will be remembered as Roy Scheider's swan song and little else. A film of serious intent undone by hackneyed plotting and intrusive editing, writer-director Joshua Newton's revenge drama is reasonably sound in its general outline, until it delves into specifics. Scheider feels at home in his final role as a retired Gotham cop who goes to Germany to hunt down the Nazi who killed his family, though his onscreen presence is increasingly trimmed away as the reels roll by. The briefest of theatrical windows (pic opened Friday for a one-week Oscar-qualifying run) will quickly close shut before a muted vid bid." The rest of the review criticized the film's writing, structure and direction and some of the actors.
Newton spoke to Allen to ascertain why Variety had published Koehler's review in the middle of the media campaign. Allen said she was flabbergasted, apologized and asked Newton to meet with Stiles.
On December 21, 2009, Newton met with Stiles and requested the online review be deleted. According to Newton, the review contained factual inaccuracies and Koehler had left the screening before the film was over. Stiles promised he would "see what he could do." A few days later, Gray telephoned and said he would investigate Newton's complaints. Moreover, Gray said he was prepared to keep the review down until January 4, 2010, to give Newton enough time to get other reviews. Variety then took the review down. However, the review had already been printed in both Los Angeles and New York, and links to the online article remained. Numerous Web sites had copied parts of the review. Once Gray finished his investigation and concluded that Newton's claims lacked any factual basis, Variety reposted Koehler's review online.
After the negative review was issued, Calibra believed that it was excused from making any more payments to Variety.
The lawsuit
Calibra sued Variety. The operative pleading alleged that Calibra was induced to spend hundreds of thousands of dollars on advertising buys with Variety for an Oscar and BAFTA awards campaign. The success of the campaign was cut short when Variety published a hostile and inaccurate review of the film on Variety online and in the daily editions of Variety in New York and Los Angeles. By so doing, Variety was guilty of breach of contract (specifically, the implied covenant of good faith and fair dealing), negligence, fraud, breach of fiduciary duty and violation of Business and Professions Code section 17200 et seq.
In response to the lawsuit, Variety filed an anti-SLAPP motion. The motion was granted. The trial court ruled: The lawsuit arises from the exercise of free speech, and there is no evidence that Variety waived its free speech rights by contracting not to publish a review of "Iron Cross." Moreover, Calibra essentially admits that the speech occurred in a public forum and was related to an issue of public interest. The burden shifted to Calibra to demonstrate a probability of prevailing on the merits. It failed to meet this burden.
The trial court awarded Variety attorney fees and costs in the amount of $57,474 and entered judgment.
On October 27, 2010, Variety filed a motion to dismiss Calibra's appeal as untimely. We denied the motion on November 17, 2010. In its respondent's brief filed on April 18, 2011, Variety once again argues that the appeal is untimely. We decline to consider the issue any further.
DISCUSSION
I. The anti-SLAPP motion.
The anti-SLAPP statute was enacted by the Legislature to give defendants an efficient procedural mechanism to defeat "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).) In service of the statute's purpose, statutory protection is extended to, inter alia, "any written or oral statement or writing made in a place open to the public or a public forum in connection with an issue of public interest, or . . . 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." (§ 425.16, subds. (e)(3), (e)(4).) If a lawsuit implicates the anti-SLAPP statute, then the lawsuit is subject to a special motion to strike unless the plaintiff establishes a probability of prevailing. (§ 425.16, subd. (b)(1).) When presented with a special motion to strike, a court is required to "consider the pleadings, and supporting and opposing affidavits stating the facts upon which [a] liability or defense is based." (§ 425.16, subd. (b)(2).)
The defendant has the threshold burden to show that the lawsuit arises from an act in furtherance of the right of petition or free speech. (Zamos v. Stroud (2004) 32 Cal.4th 958, 965.) If the defendant succeeds, the burden shifts to the plaintiff. To establish a probability of prevailing, the plaintiff must show that the pleading is legally sufficient and there is enough evidence to make a prima facie case. In deciding the issue, the court "'does not weigh the credibility or comparative probative strength of competing evidence.'" (Ibid.)As explained by Taus, the statute was "intended to establish a summary-judgment-like procedure available at an early stage of litigation." (Taus v. Loftus (2007) 40 Cal.4th 683, 714.) Though a defendant can submit evidence, it has a very limited role. It may be examined only to determine whether it defeats the plaintiff's claim as a matter of law. (Soukup v. Law Offices of Herbert Hafif (2006) 39 Cal.4th 260, 269, fn. 3 (Soukup).)
Tacitly, Calibra concedes that this case involves the exercise of free speech in connection with an issue of public interest. It assigns error on the theory that the trial court improperly found that Calibra failed to establish a prima facie case for any of the causes of action in its lawsuit. We turn to the issues. Our review is de novo. (Soukup, supra, 39 Cal.4th at p. 269, fn. 3.)
A. Variety's First Amendment rights.
According to Calibra, the trial court erred when it found that Variety did not waive its right to publish a review. The law and facts establish the opposite.
The First Amendment grants a newspaper "virtually unfettered rights to choose what to print." (Eisenberg v. Alameda Newspapers, Inc. (1999) 74 Cal.App.4th 1359, 1391.) Those rights, of course, can be waived by contract. (ITT Telecom Products Corp. v. Dooley (1989) 214 Cal.App.3d 307, 319.) But it has been held that "'[a] waiver of First Amendment rights may only be made by a "clear and compelling" relinquishment of them. [Citation.]' [Citation.] 'Moreover, it is well established that courts closely scrutinize waivers of constitutional rights, and "indulge every reasonable presumption against a waiver." [Citations.]' [Citations.]" (City of Glendale v. George (1989) 208 Cal.App.3d 1394, 1398.)
The written contract prepared by Allen did not contain a waiver of Variety's right to publish a review of the film. In the operative pleading, Calibra alleges that "[p]ursuant to the terms of the agreement and the understanding of the parties, [Calibra] would pay to [Variety] a base sum in the range of $350,000 to $427,500 for an exclusive promotional buy for 3-5 front cover ads, daily and weekly strips, DVD inserts, and screenings in Los Angeles, New York and San Francisco. In addition to the base price of the promotional campaign, [Calibra] would incur and pay additional production costs as specified in [the written contract]. It was understood that the exclusive promotional campaign in Variety would saturate the film industry with information calculated to secure positive attention from the awards shows and a distribution deal for [Calibra]. [¶] There was implied into said contract by operation of law a covenant of good faith and fair dealing which required Variety to act and to conduct its affairs and its operations in a manner so as not to frustrate the purposes of its contract with [Variety]." As the foregoing quote makes plain, Calibra did not allege that Variety specifically agreed to waive it right to publish a review of the film. In his declaration, Newton did not aver that the parties talked about Variety withholding a review until Calibra's promotional campaign was completed and the film was finalized. We easily conclude that the contract, operative pleading and evidence failed to establish a prima facie case of a clear and compelling waiver of Variety's rights.
Calibra contends that Variety impliedly waived its First Amendment right to publish a review of the film by entering into an exclusive media partnership with Calibra and forming a fiduciary relationship. This contention is faced with an immediate legal obstacle. The court in Integrated Healthcare Holdings, Inc. v. Fitzgibbons (2006) 140 Cal.App.4th 515, 532 (IHH)specifically held that the "courts will not imply a waiver of free speech rights." Nonetheless, Calibra argues that IHH and other cases establish rather than defeat the waiver claim.
In IHH, a company that was heavily debt leveraged sought to acquire four hospitals, including a trauma center, in Orange County. The trauma center's medical staff opposed the acquisition due to concerns regarding the company's financial stability and its principal's past business failures in the health care industry. To assuage the medical staff, the parties entered into a three-year contract that, inter alia, gave the medical staff significant financial oversight over the trauma center's operations. As consideration, the medical staff agreed to provide public support for the company's acquisition of the four hospitals and issuance of the related licenses. Two months after the acquisition and licensing of the hospitals was completed, the company's lender served a notice of default. The default was disclosed in the company's filing with the Securities and Exchange Commission, and reported in an article in the Orange County Register. Two days later, a member of the medical staff named Fitzgibbons sent an e-mail to medical executive committee members and other individuals who he believed might offer financial assistance to the trauma center. He expressed concern that the company could be headed for bankruptcy and discussed the company's finances. (IHH, supra, 140 Cal.App.4th at pp. 519-520.)
The company sued Fitzgibbons for defamation, intentional and negligent interference with a contractual relationship, breach of contract, breach of the duty of good faith and fair dealing and unfair business practices in violation of Business and Professions Code section 17200 et seq. (IHH, supra, 140 Cal.App.4th at p. 520.) Fitzgibbons filed an anti-SLAPP motion, which was denied. The Court of Appeal reversed because the e-mail message concerned an issue of public interest and the company failed to establish a probability of prevailing on any of its claims. In particular, the IHH court found that the company failed to show that any of the statements were false or actionable for purposes of the defamation and unfair business practices claim. As for breach of contract and breach of the implied covenant of good faith and fair dealing, the contract was not sufficiently clear and definite to demonstrate that Fitzgibbons waived his First Amendment rights. Moreover, the company failed "to provide any evidence Fitzgibbons expressed an understanding he relinquished all right to criticize [the company] or its operation of [the trauma center] when he signed the agreement." (Id. at p. 532.) Nor did the court find that the company had established a prima facie case regarding the two alleged torts. (Id. at pp. 532-533.)
Calibra argues that it "made a prima facie showing of the very facts which the [company in IHH]lacked. In particular, the fact that [Variety] took the review down after Newton complained, and did not put if back up until months later [citations], is indicative of the parties' understanding that [Variety] would not publish a negative review of the [film] during the [c]ampaign, as it would breach [Variety's] promise to positively promote the [film] to distributors. Further of note, the review occurred in the middle of the [c]ampaign, before [Calibra] had completed paying for all the agreed-upon advertising. [Citations.] This fact further supports a reasonable inference that [Variety] was both willing and able to suspend its speech during the term of the [c]ampaign in order to court [Calibra's] business." We cannot accede. Calibra relies on inference to establish a waiver. But we must indulge every reasonable presumption against a waiver in making our assessment. On this record, it is reasonable to presume that Variety took the review down as a courtesy to Calibra rather than because Variety believed that it had waived any of its free speech rights. Further, the inference suggested by Calibra is nullified by Variety's reposting of the review.
Next, Calibra suggests that its position is supported by Paragould Cablevision v. City of Paragould, Ark. (8th Cir. 1991) 930 F.2d 1310 (Paragould). In Paragould, a cable company entered into a franchise agreement with a city that contained the following provision: "This agreement does not cover major technical advances in TV reception and use, in cable TV or in TV-related technology such as, but not limited to, two-way capability, teleconferencing, or use of inexpensive individual satellite receivers or components thereof. It does not cover additional income-producing activities of [the cable company] such as advertising over [the cable company's] cable TV system. If [the cable company] should decide to offer services to subscribers involving these or other major technical advances or to undertake other income producing activities, it will first notify the City and offer its proposed modification to this Agreement to cover such additional services and activities, and the proposed modification shall be subject to negotiation." (Id. at p. 1314.) The cable company sued. It claimed, among other things, that the city had violated the cable company's commercial free speech rights by requiring it to notify and gain approval from the city before soliciting advertising to air on the cable company's system. The court held that by entering the franchise agreement, the cable company "effectively bargained away some of its free speech rights." (Id. at p. 1315.) It "could have bargained for an unqualified right to solicit and transmit advertisements. No law mandated otherwise. [The cable company] simply failed to protect its commercial rights. Presumably [the cable company] received consideration in return for this sacrifice, but apparently what was once considered a satisfactory bargain has turned into a sour deal. Regardless, [the cable company] cannot now invoke the first amendment to recapture surrendered rights." (Ibid.)
According to Calibra, Paragould establishes that in commercial transactions involving sophisticated parties, waiver of free speech rights can be implied from the terms and conditions of the parties' agreement. Indeed, Paragould has been read in this way by the Ninth Circuit. (Charter Communications v. County of Santa Cruz (9th Cir. 2002) 304 F.3d 927, 935, fn. 9.) That said, Calibra's attempt to invoke Paragould prompts immediate skepticism. Properly understood, Paragould holds that the courts will recognize a waiver of free speech rights if a sophisticated party agrees to contractual language that expressly restricts the party's exercise of a certain type of speech. In that instance, the waiver is implied only in the sense that the waiver and the rights waived are not spelled out in the parties' contractual language. Nonetheless, the waiver flows directly from the concrete and agreed upon restriction on speech. The case at bar is distinguishable because a restriction on speech (implying a waiver of free speech rights) is not stated in the contract.
Paragould, in our view, is not inconsistent with IHH. When IHH stated that courts will not imply a waiver, it essentially meant that courts will not imply an agreement to restrict speech from which, with bootstrap logic, a waiver of rights can then also be implied.
B. Breach of contract.
The implied covenant of good faith and fair dealing operates to prevent a contracting party from engaging in conduct that frustrates the other party's rights to the benefits of the contract. (Benach v. County of Los Angeles (2007) 149 Cal.App.4th 836, 855, fn. 12.) It protects and furthers only the express terms of the contract, not general public policy considerations. (Wolf v. Walt Disney Pictures & Television (2008) 162 Cal.App.4th 1107, 1120.)
Calibra argues that Variety breached the implied covenant of good faith and fair dealing by publishing the review. But because Calibra failed to establish a prima facie case that Variety waived its free speech rights, this cause of action was properly stricken under the anti-SLAPP statute. Notably, Calibra did not cite any case law to support the notion that a restriction on speech and a waiver of free speech rights can be implied into a contract by operation of law.
In any event, the operative pleading alleged only that Variety agreed to publish advertisements for the film, insert DVDs into Variety's publications and arrange for three screenings. Calibra did not allege that the parties agreed to any other terms. Nor did Calibra allege that Variety failed to perform the express duties outlined by the contract. Thus, we cannot conclude that publication of the review frustrated Calibra's right to the benefits of the contract.
C. Negligence.
Calibra argues that Variety was negligent when it published the review on December 20, 2009. In support of its claim that Variety owed a duty of care, Calibra relies on Civil Code section 1714, Erlich v. Menezes (1999) 21 Cal.4th 543, 552 (Erlich)and Burns v. Neiman Marcus Group, Inc. (2009) 173 Cal.App.4th 479 (Burns). This claim is unfounded.
The operative pleading alleges that the breach of care occurred on October 20, 2009. We presume this was a typographical error.
Everyone is responsible for an injury "occasioned to another by his or her want of ordinary care or skill in the management of his or her property or person." (Civ. Code, § 1714, subd. (a).) Tort damages are permitted in contract cases where "the duty that gives rise to tort liability is . . . completely independent of the contract." (Erlich, supra, 21 Cal.4th at p. 552.) In determining whether to impose a legal duty, a court must consider the factors set forth in Rowland v. Christian (1968) 69 Cal.2d 108, 113 (Rowland). The factors are foreseeability of the harm to the plaintiff, the degree of certainty that the plaintiff suffered injury, the closeness of the connection between the defendant's conduct and the injury, the moral blame attached to the defendant's conduct, the policy of preventing future harm, the extent of the burden to the defendant and consequences to the community of imposing a duty to exercise care with resulting liability for breach, and the availability, cost, and prevalence of insurance for the risk. (Burns, supra, 173 Cal.App.4th at pp. 487-488.)
Calibra did not analyze the Rowland factors. Nor did it cite any case law establishing that the United States and California Constitutions allow a plaintiff to recover tort damages against a newspaper for publishing an article that contains opinion and nondefamatory assertions of fact. These deficiencies in Calibra's appellate briefs doom its appeal. We note that the "freedom of expression protected by the First Amendment exists to preserve an uninhibited marketplace of ideas and to further individual rights of self-expression. [Citation.]" (Kirby v. Sega of America, Inc. (2006) 144 Cal.App.4th 47, 57-58.) Thus, no duty could exist under Rowland for Variety to refrain from publishing the review. The consequences to the community of imposing such a duty would be anathema. It would chill freedom of speech and injure the marketplace of ideas. And even if such a duty existed, liability would be thwarted by Variety's First Amendment defense. (Snyder v. Phelps (2011) 131 S.Ct. 1207, 1215 [the free speech clause of the First Amendment "can serve as a defense in state torts suits"].) Under that defense, Variety can avoid liability for engaging in speech that falls within First Amendment protections. (Id. at pp. 1215-1216.)
D. Breach of Fiduciary Duty.
Calibra argues that a fiduciary duty was created by: (1) the parties' exclusive media partnership; (2) promises by Variety to promote "Iron Cross" to distributors; (3) a disparity in the parties' bargaining power; (4) Variety's acceptance of hundreds of thousands of dollars from the exclusive media partnership; and (5) Calibra's dependence upon Variety to faithfully perform its commitment to help Calibra promote the film and find a distributor.
In our view, a fiduciary duty did not exist.
"Confidential and fiduciary relations are, in law, synonymous, and may be said to exist whenever trust and confidence is reposed by one person in the integrity and fidelity of another." (Estate of Cover (1922) 188 Cal. 133, 143.) In a fiduciary relationship, "'"the party in whom the confidence is reposed, if he voluntarily accepts or assumes to accept the confidence, can take no advantage from his acts relating to the interest of the other party without the latter's knowledge or consent. ..."' [Citations.]" (Wolf v. Superior Court (2003) 107 Cal.App.4th 25, 29.) Traditionally, the following relationships are fiduciary: trustee and beneficiary; director and shareholder of a corporation; joint adventurers; business partners; agent and principal. (Id. at p. 30.) In addition, a fiduciary duty can be undertaken by agreement. (Maglica v. Maglica (1998) 66 Cal.App.4th 442, 447-448.)
None of the traditional fiduciary relationships is at issue here. Variety was not a trustee of a trust to which Calibra was a beneficiary, nor was Variety a director of a corporation in which Calibra held stock. There was no allegation or evidence that Variety assumed a fiduciary duty by contract.
The allegation that Variety and Calibra were exclusive media partners suggests the existence of a partnership or joint venture, but that suggestion does not survive scrutiny. A partnership is an association of two or more persons to own a business for profit on a continuing basis. (9 Witkin, Summary of Cal. Law (10th ed. 2005) Partnership, §§ 9, 22 pp. 583, 597.) A joint venture exists when "its members associate together as coowners of a business enterprise [and agree] to share profits and losses" for a single transaction or series of transactions. (9 Witkin, supra, Partnership, § 9, p. 583.) There is no evidence that Calibra and Variety agreed to jointly own a business and share profits and losses.
Calibra alleged that Variety offered to help "Iron Cross" gain awards recognition, and that Allen said she would contact distributors directly and help Calibra obtain a distributor if Variety and Calibra became exclusive media partners. It was also alleged that Variety contacted three awards consultants for Calibra to consider. These allegations engender a question: did Variety and Calibra form an agency relationship? An agency results when a person or entity represents another, called the principal, in dealings with third persons. (Civ. Code, § 2295.) "An agent for a particular act or transaction is called a special agent. All others are general agents." (Civ. Code, § 2297.) Normally, agency is created by an express contract. But the contract can be implied from the circumstances and the conduct of the parties. (3 Witkin, Summary of Cal. Law (10th ed. 2005) Agency and Employment, § 92, pp. 139-140.) The problem for Calibra is that it did not allege or argue below, and it does not argue on appeal, that the parties formed an agency contract. Calibra's assertion that Variety "courted . . . an agency relationship" does not serve as a sufficient substitute. In any event, the context of the allegations and evidence demonstrate that Variety was offering help to Calibra as a method of landing a large advertising contract, and in no way was Variety offering to act in anyone's interest but its own. Our conclusion is bolstered by Allen's September 20, 2009, e-mail to Newton. She wrote: "I have contacted 3 Awards Consultants that I know do a terrific job, who will call you and set up a time to meet with your on Friday." The e-mail provided names, addresses and telephone numbers. Thus, Allen did no more than make recommendations. Neither she nor Variety proposed to negotiate with the consultants for Calibra.
We now turn to Calibra's argument that various facts in combination or isolation gave rise to a fiduciary duty. To advance its cause, Calibra relies on Thompson v. Cannon (1978) 224 Cal.App.3d 1413 (Thompson)and Stevens v. Marco (1956) 147 Cal.App.2d 357 (Stevens).) In Thompson, the court held that an independent adjuster, hired by an insurance company to adjust a disputed claim with its insured, does not owe a fiduciary duty to the insured. (Thompson, supra, 224 Cal.App.3d at p. 1418.) In Stevens, the court held: "Where an inventor entrusts his secret idea or device to another under an arrangement whereby the other party agrees to develop, patent and commercially exploit the idea in return for royalties to be paid the inventor, there arises a confidential or fiduciary relationship between the parties. [Citations.]" (Stevens, supra, 147 Cal.App.2d at p. 373.) We are unable to extrapolate a rule from Thompson and Stevens that is helpful to Calibra's appeal. More specifically, unlike the plaintiff in Stevens, Calibra did not repose confidence and trust in the integrity of Variety with respect to secret processes and the payment of royalties. For our analysis, we rely on the cases previously discussed above as well as City of Hope National Medical Center v. Genentech, Inc. (2008) 43 Cal.4th 375 (City of Hope).
The parties' exclusive media partnership was not a legal partnership. Rather, it was a title given by the parties to their contract. That title and its context do not establish or suggest that Calibra reposed confidence in the integrity of Variety, nor that Variety accepted such confidence. It was an arm's length transaction. Undeniably, the contract to advertise and screen "Iron Cross" did not expressly or impliedly create an agency relationship. Variety was not paid for services beyond those in its proposal, and it was not contractually authorized to negotiate with third parties on behalf of Calibra. Instead, Variety was acting in its own financial interest. Calibra could not have reasonably expected otherwise, particularly because Variety was a trade paper that did not agree to waive its free speech rights or be a fiduciary.
Though Calibra contends that there was a disparity in the parties' bargaining power in favor of Variety, this contention does not save the day. Every contract requires one party to repose an element of trust and confidence in the other to perform. But "one party's 'ability to exploit a disparity of bargaining power' between the parties does not necessarily create a fiduciary relationship. [Citation.]" (City of Hope, supra, 43 Cal.4th at pp. 389-390.) Regardless, we note that Calibra was an obviously well-funded film company with hundreds of thousands of dollars at its disposal. It held the purse strings and did not have to advertise in Variety at the end of 2009. The fact that Variety accepted Calibra's money does not suggest anything other than a commercial transaction in which one party pays another for a service.
Moving on, Calibra places stock in its purported dependence upon Variety to faithfully perform its commitment to promote the film and help Calibra find a distributor. But all Variety agreed to provide was advertising and screenings. It fulfilled its promises. According to Newton, Allen said she would contact distributors. But that was not a term in the parties' contract, and Calibra provided no evidence that Allen reneged. Boiled down, Calibra's claim appears to be simply this: it depended upon Variety to refrain from panning "Iron Cross." That may be, but that dependence cannot, by itself, convert what was otherwise an arm's length transaction into a fiduciary relationship. And, plainly stated, Calibra could not have reasonably believed that securing an advertising/screening contract with Variety's sales department would have any impact on the editorial department, especially when Variety did not contractually agree to waive its free speech rights. For good reason, the two departments have been separate for over 100 years. If Variety's editorial department handled advertising customers with a velvet glove, Variety would lose credibility as a source of independent news and opinions about the entertainment industry.
Calibra points out that Variety advised Calibra when to release "Iron Cross" and the propriety of releasing a nonfinal cut. The advice was free, and Calibra did not have to take it. Any contention by Calibra that it paid for the advice is belied by the allegations and evidence establishing that what it paid for was advertising and advertising alone. We know of no published opinion that holds that an entity becomes a fiduciary when it renders free advice.
In the absence of a fiduciary duty, Calibra's cause of action for breach of fiduciary duty was properly stricken.
E. Fraud.
The trial court concluded that Calibra failed to allege a cause of action for fraud. Calibra contends that the trial court erred.
Upon review, no error appears.
Fraudulent deceit is defined as: (1) the suggestion, as a fact, of that which is not true, by one who does not believe it to be true; (2) the assertion, as a fact, of that which is not true, by one who has no reasonable ground for believing it to be true; (3) the suppression of a fact, by one who is bound to disclose it, or who gives information of other facts which are likely to mislead for want of communication of that fact; or (4) a promise, made without any intention of performing it. (Civ. Code, § 1710.) To properly plead the first type of fraud, a plaintiff must allege a misrepresentation, knowledge of its falsity, intent to defraud, justifiable reliance and resulting damages. Every element must be pleaded with specificity. (Roberts v. Ball, Hunt, Hart, Brown & Baerwitz (1976) 57 Cal.App.3d 104, 109.) To plead nondisclosure (also known as constructive fraud), a plaintiff must allege: (1) a fiduciary relationship; (2) breach of fiduciary duty based on nondisclosure; (3) intent to deceive; (4) reliance; and (5) resulting injury. (Stokes v. Henson (1990) 217 Cal.App.3d 187, 197.)
The operative pleading alleged that Variety "made various representations to [Calibra] that [it] had the potential to win one or more Academy Awards. On [June 22, 2009], these representations were published in Variety's print and online editions by [Gray] and were repeated the same day by [Allen] to [Newton] by telephone. On [August 25, 2009,] and [September 30, 2009,] the same representations were made in writing by [Variety] to [Calibra] in addition to [being] made by [Variety] during lunch with [Newton] on [September 7, 2009]."
In general, a representation does not support a fraud cause of action unless it is an affirmation of a past or existing fact. (5 Witkin, Summary of Cal. Law (10th ed. 2005) Torts, § 773, pp. 1122, 1124; Hinesley v. Oakshade Town Center (2005) 135 Cal.App.4th 289, 295 ["an action for fraud must be based on a statement of fact, not opinion, and . . . statements as to future actions by some third party are deemed nonactionable opinions"].) The alleged statements by Variety are neither. Rather, they are merely opinions about the possible actions of the Academy Awards voters. An opinion is actionable only under certain exceptions, such as when the defendant holds itself out as being specially qualified; the opinion is stated as fact or implies justifying facts; or the opinion is rendered by a fiduciary or other trusted person. (5 Witkin, supra, Torts, §§ 775-777, pp. 1125- 1127.) According to Calibra, Variety was a fiduciary, and Calibra does not suggest that any other exception to the general rule might otherwise apply. As we have explained, however, Variety was not a fiduciary. Thus, Variety's predictions are not actionable.
According to Calibra, the predictions were known to be false because no one at Variety had seen "Iron Cross." This allegation is a non sequitur. Only a statement of past or existing fact can be false. Presumably what Calibra means is that Variety did not believe that its predictions had any merit. There is no supporting evidence. Indeed, the evidence indicates that Variety's prediction had arguable merit. One of Calibra's experts, Martin A. Grove (Grove), suggested in a declaration that "Iron Cross" did have Academy Awards potential, at least initially. He averred that the film had two factors working in its favor. First, it was the last film that Roy Scheider starred in before his death in February 2008, so the film "had the potential to attract interest from actors. Mr. Scheider had only been Oscar nominated twice in his long career . . . and he'd never won. Now with this final performance there was one last opportunity for the Academy to honor him with a Best Actor Oscar win. Because actors make up the Academy's largest branch, voting by actors has a strong impact on the Oscars." Second, according to Grove, "the film's Holocaust theme has resonated with Academy voters over the years."
This interpretation is suggested by Calibra in its reply brief.
Assuming for the sake of argument that Variety did not believe its prediction that "Iron Cross" had Oscar potential, Calibra's reliance on the prediction was unjustified. Grove explained that "Iron Cross" had an uphill battled for Oscar consideration because it was an obscure independent film. Moreover, the film was not completed at the time the parties entered into their contract, and no one at Variety had seen anything more than a trailer. Thus, other than the film's theme and star, Variety had no legitimate basis for offering a prediction.
Next, Calibra alleged that at the time the parties entered into their contract, Variety failed to disclose its secret intent to destroy "Iron Cross" with a negative review. The evidence negates the allegation. The contract was negotiated by the sales department months before the editorial department assigned Koehler to write a review, and the two departments are separate. There was no evidence that Variety told Koehler what to write or had a motive to destroy "Iron Cross." If anything, it was in the best interest of the advertising department of Variety for no review to be published unless it was a good review. If no review was published, or a good review was published, Calibra would have continued paying on its contract. But once the negative review was published, Calibra stopped paying. As a result, the negative review worked against Variety's economic interest. In any event, the claim based on nondisclosure is not actionable absent a fiduciary duty.
In its reply brief, Calibra contends that Variety committed fraud by falsely promising to help Calibra obtain a distributor. "'A point not presented in a party's opening brief is deemed to have been abandoned or waived. [Citations.]' [Citation.]" (Wurzl v. Holloway (1996) 46 Cal.App.4th 1740, 1754, fn. 1.) Beyond that, the operative pleading reveals a defect. The fraud cause of action does not allege that anyone acting on behalf of Variety promised to help Calibra obtain a distributor for "Iron Cross" with no intention of performing. Nor does the evidence fill in the gaps. Calibra did not offer proof that Allen, for example, did not follow through with her offer to contact distributor's on Calibra's behalf. Calibra attempts to support its position by claiming that the negative review is prima facie evidence that the offers to help Calibra find a distributor were false. But Koehler, a freelance critic, wrote the review, not the people who offered to help Calibra. No reasonable inference favorable to Calibra can be drawn from these facts.
F. Unfair business practices.
Calibra contends that it established a claim for unfair business practices. This contention lacks merit.
As defined by statute, unfair competition includes "any unlawful, unfair or fraudulent business act or practice." (Bus. & Prof. Code, § 17200.) An unlawful business practice is anything that can be called a business practice and that at the same time is forbidden by federal, state or local law. (Ticconi v. Blue Shielf of California Life & Health Ins. Co. (2008) 160 Cal.App.4th 528, 539.) A business practice is considered fraudulent if it is likely to deceive the public. (McKell v. Washington Mutual, Inc. (2006) 142 Cal.App.4th 1457, 1471.) An act or practice is unfair if "it violates established public policy or if it is immoral, unethical, oppressive or unscrupulous and causes injury to consumers which outweighs its benefits. [Citations.]" (Id. at p. 1473.) Moreover, a party who alleges an unfair practice must establish that the injury suffered was not one that could have been reasonably avoided. (Daugherty v. American Honda Motor Co., Inc. (2006) 144 Cal.App.4th 824, 839.) "A plaintiff alleging unfair business practices under [the unfair competition] statutes must state with reasonable particularity the facts supporting the statutory elements of the violation. [Citations.]" (Khoury v. Maly's of California, Inc. (1993) 14 Cal.App.4th 612, 619.)
The unfair business practices cause of action incorporates all prior allegations and further alleges: "The acts and conduct alleged herein above constituted a fraudulent, unlawful and/or unfair business practice." This allegation is insufficient because it is not set forth with particularity.
To be complete, we reviewed and considered Calibra's arguments. It asserts that Variety engaged in a fraudulent business practice by promoting an exclusive media partnership with Calibra. Calibra claims it was deceived by Variety's false advertising and suffered damage. In addition, Calibra argues Variety's "marketing practices violated statutory laws prohibiting fraud and deceit." As we have indicated, Variety did not transgress Civil Code section 1710. Nor do we accept that members of the public are likely to be deceived by anything that Variety did. It sold and provided advertising, which the evidence shows was a success because it generated interest in "Iron Cross." Variety did not promise to waive its free speech rights, and its sales department is separate from its editorial department. Thus, it is unlikely Variety's conduct would lead the public to believe that buying advertising would preclude Variety from publishing negative press about the buyer.
III. Attorney fees.
Calibra challenges the award of attorney fees on the grounds that the anti-SLAPP motion should never have been granted. Because the anti-SLAPP motion had merit, the attorney fee award in favor of Variety must stand. Further, as the prevailing party on appeal involving section 425.16, Variety is entitled to an additional attorney fee award. (Evans v. Unkow (1995) 38 Cal.App.4th 1490, 1499 [attorney fees on appeal properly awarded to a defendant who successfully defends an order striking a complaint under the anti-SLAPP statute].) After remittitur, the trial court is directed to fix the amount of attorney fees that Variety can recover.
DISPOSITION
The order is affirmed.
Variety shall recover its costs and attorney fees on appeal, the amount of which shall be determined by the trial court.
NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS.
ASHMANN-GERST, J. We concur: BOREN, P. J. DOI TODD, J.