The case, World Financial Group, Inc. v. HBW Insurance & Financial Services, Inc. involved the situation where employees broke off from their former employer and started to work for a direct competitor. After leaving employment, the former employees made statements to former colleagues and customers in an attempt to have them join their new venture.
However, the defendants signed an “Associate Membership Agreement” with World Financial that prohibited them from recruiting customers, employees, and sharing trade secrets of World Financial for a limited time after they left employment with World Financial. World Financial Group, filed the lawsuit for breach of contract, breach of the implied covenant of good faith and fair dealing, conversion, violation of the Uniform Trade Secrets Act and the Unfair Competition Law, intentional and negligent interference with prospective economic advantage, and unjust enrichment.
The defendants took an offensive step and filed an anti-SLAPP motion to dismiss plaintiff’s lawsuit in arguing that their actions were protected speech. The court explained that an anti-SLAPP motion:
…provides 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 or 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."
The issue in this case was whether defendants’ speech is afforded protection under the anti-SLAPP statue. The anti-SLAPP law applies to claims "arising from" speech or conduct "in furtherance of the exercise of the constitutional right of . . . free speech in connection with a public issue or an issue of public interest." (Code of Civil Procedure § 425.16, subd. (e)(4).)
The court held that the type of speech at issue here was not protected. The court explained:
While employee mobility and competition are undoubtedly issues of public interest when considered in the abstract, one could arguably identify a strong public interest in the vindication of any right for which there is a legal remedy. "The fact that ‘a broad and amorphous public interest’ can be connected to a specific dispute is not sufficient to meet the statutory requirements" of the anti-SLAPP statute. [citation] By focusing on society’s general interest in the subject matter of the dispute instead of the specific speech or conduct upon which the complaint is based, defendants resort to the oft-rejected, so-called "synecdoche theory of public issue in the anti-SLAPP statute," where "[t]he part [is considered] synonymous with the greater whole." [citation] In evaluating the first prong of the anti-SLAPP statute, we must focus on "the specific nature of the speech rather than the generalities that might be abstracted from it. [citation.]"
The court found that the defendants’ attempt to frame their speech as involving "the pursuit of lawful employment pursuant to Bus. & Prof. § 16600" and "workforce mobility and free competition" as “infirm.” The court held that the defendants’ speech did not rise to this protected level because it was merely soliciting a competitor’s employees and customers. There was no public The court stated that if it applied the anti-SLAPP statute as defendants requested, it “would effectively ‘eviscerate the unfair business practices laws,’ a result the Legislature plainly did not intend.” To bring the point home, the court quoted The Godfather: “As Salvatore Tessio said to Tom Hagen, ‘Tell Mike it was only business.’ So it is here.”