Case moving forward to discovery and litigation phases
LOS ANGELES (May 23) - The CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.) today announced that the Court of Appeal, Fourth Appellate District, Division One has again ruled in favor of C.A.R. in its malicious prosecution complaint against attorney David Barry and plaintiff Arleen Freeman.
"Here, any reasonable attorney would have recognized the claims asserted in Freeman III were fatally defective on a whole host of grounds," said Presiding Justice Benke of the Court of Appeal, Fourth Appellate District, Division One in the unpublished opinion. "No reasonable attorney, conversant on any level with the holding in Freeman II, would construe these cases as in any manner supporting the notion that prior litigation conduct, including discovery abuses, itself amounts to a restraint on trade."
"In the end, it is the volume of fatal defects in the claims asserted in Freeman III which bring it within that narrow class of cases which all reasonable lawyers would agree lack merit," Justice Benke ruled. "From this circumstance a reasonable trier of fact could infer the principal purpose of Freeman III was to consume C.A.R. resources that might otherwise be available to other antitrust defendants or compel a settlement from all the defendants, including C.A.R. This inference of a collateral purpose would of course be supported by the complete lack of merit in Freeman III. Here, however, there is a great deal more which suggests malice towards C.A.R."
"C.A.R. was able to show a probability of success on each element of its malicious prosecution claim," Benke concluded.
C.A.R. filed the malicious prosecution action against Arleen Freeman and her attorney David Barry in September 2005. Barry filed a motion to strike C.A.R.'s malicious prosecution complaint, which the San Diego Superior Court denied in February 2006, agreeing with C.A.R.'s position that no reasonable attorney could think there could be another lawsuit on the same matter that had already been dismissed by the Federal District Court and the Federal Court of Appeals. The February 2006 court decision found that no reasonable attorney would file this suit and that C.A.R. demonstrated sufficient evidence of malice to go forward with the case against Barry.
In 1997, Freeman sued C.A.R. in federal court, lost on summary judgment, and a U.S. Court of Appeals upheld C.A.R.'s dismissal. Despite these clear rulings, Freeman re-filed against C.A.R. in the same federal court again and also sued the attorneys in the case. The U.S. Ninth Circuit Court of Appeal upheld all of the district court's dismissals in C.A.R.'s favor for the second time.
Barry has brought more than a dozen legal actions against C.A.R. and organized real estate for more than two decades, yet in these cases his clients have never obtained a judgment against associations of REALTORS® except in one case on a narrow legal issue pursuant to a settlement to avoid the costs of trial.
"The court's ruling is a solid win that puts C.A.R. in a very favorable position for the next phase of the litigation: discovery and then trial," said C.A.R. President Colleen Badagliacco. "We are very pleased with these results.
"Lawyers are required to have some legal basis for pressing a suit," she said. "State law prohibits malicious prosecution such as when litigants re-file the same matter against the same defendants, causing the defendants to incur attorneys' fees and costs to get it dismissed. At some point, litigation is supposed to be conclusive."
"The case against both Arleen Freeman and David Barry and Barry and Associates will now proceed," Badagliacco said. "We expect to continue to prevail."
The court's decision is available online at http://www.courtinfo.ca.gov/opinions/nonpub/D048441.PDF.
Leading the way...® in California real estate for more than 100 years, the CALIFORNIA ASSOCIATION OF REALTORS® (http://www.car.org/) is one of the largest state trade organizations in the United States, with more than 185,000 members dedicated to the advancement of professionalism in real estate. C.A.R. is headquartered in Los Angeles.
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