Filed 8/27/15 Gardner v. Roeder CA6
                      NOT TO BE PUBLISHED IN OFFICIAL REPORTS
California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for
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              IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

                                      SIXTH APPELLATE DISTRICT


ALAN GARDNER,                                                        H038407
                                                                    (Santa Clara County
         Plaintiff and Appellant,                                    Super. Ct. No. CV216725)

             v.

JOHN WALTER ROEDER et al.,

         Defendants and Respondents.



         Plaintiff Alan Gardner brought this action against defendant John Walter Roeder
alleging that Roeder had breached a settlement agreement by bringing a lawsuit based
upon claims that, according to Gardner, Roeder had released. Roeder responded with an
anti-SLAPP motion (Code Civ. Proc., § 425.16), which the trial court granted. Gardner
contends that this was error because, even though Roeder was not a named releasor in the
settlement agreement, one of the parties was acting as his alter ego. We find no error,
and affirm.
                                                   BACKGROUND
         According to the complaint, this is the fourth of four related lawsuits. The first
two had their genesis in Gardner’s employment by Great Oaks Water Company (Great
Oaks) as its Chief Operating Officer from November 2001 to September 2006. He
alleges that respondent Roeder was Great Oaks’s “[O]wner, Chief Executive Officer . . .
and controlling shareholder,” as well as its “Chairman of the Board of Directors.” Upon
Gardner’s separation from employment, he alleges, he filed suit against Great Oaks—
apparently for employment discrimination—and Great Oaks countersued for “breach of
confidential relationship, civil extortion, defamation and declaratory relief.” The parties
settled these actions and executed the mutual release on which this lawsuit is based.
       The third suit was filed six weeks later, when Roeder sued Gardner on what are
alleged to be “the identical causes of actions previously released between the parties.”
(Italics and underlining omitted.) Based on this conduct, Gardner brought the present
action (suit number four) against Roeder, charging him with breach of contract and unfair
business practices in violation of Business and Professions Code section 17200.
       Roeder moved to strike the complaint pursuant to the anti-SLAPP law, Code of
Civil Procedure section 425.16. The trial court granted the motion and entered judgment
for Roeder. Gardner filed this timely appeal.
                                        DISCUSSION
       “The anti-SLAPP law authorizes a defendant to bring a ‘Special Motion to Strike’
any cause of action ‘arising from any act of [the defendant] in furtherance of [the
defendant’s] right of petition or free speech . . . in connection with a public issue.’
(§ 425.16, subd. (b)(1).)” (Old Republic Construction Program Group v. Boccardo Law
Firm, Inc. (2014) 230 Cal.App.4th 859, 866, review denied, Feb. 11,2015.) The statute
“mandates a two-step analysis. The first step is to determine whether the moving party
has shown that the targeted cause of action arises from conduct protected by the statute.
[Citation.] If the answer is yes, the court considers whether the plaintiff has established
the requisite probability of success. [Citation.] As to both questions, a reviewing court
applies its independent judgment, without deference to the trial court’s ruling.
[Citation.]” (Ibid.)



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       Gardner does not challenge the trial court’s finding that the present suit arises
from conduct protected by the statute, i.e., Roeder’s filing of a lawsuit, which was of
course an exercise of the right of petition. The entire question on appeal is whether
Gardner demonstrated a likelihood of success on the merits. The trial court found that he
did not, because the release by its terms was not binding on Roeder, and because Gardner
presented no evidence substantiating the naked allegation that Great Oaks was an alter
ego for Roeder. No error appears in either determination.
       Gardner repeatedly asserts that the release is “binding on . . . Great Oaks and ‘its
officers, employees, agents, attorneys, representatives, successors and assigns.’ ” (Italics
omitted.) It is not. The quoted phrase describes not the persons bound by the release, but
those benefited by it—the releasees, not the releasors.1 The only releasors identified in
the instrument are Gardner and Great Oaks. The release might be argued to bind Great
Oaks’s “successors in interest,” in that it releases Gardner from claims “which Great
Oaks Water Company, A California Corporation or its successors in interest now own or
hold, or have at any time heretofore owned or held, or may at any time, own or
hold . . . .” But nothing in the release purports to bind any other person. If it failed to


       1
         The release of Gardner states in relevant part that “Great Oaks Water Company,
a California Corporation, hereby releases and forever discharges Alan Joel Gardner as
well as his agents, attorneys, representatives, successors. and assigns, and each of them,
of and from any and all liabilities . . . arising in law, equity, or otherwise, . . . which Great
Oaks Water Company, A California Corporation or its successors in interest now own or
hold, or have at any time heretofore owned or held, or may at any time, own or hold by
reason of any matter or thing arising from, any cause whatsoever prior to the date of
execution of this Agreement . . . .”

       Gardner’s release of Great Oaks was similarly limited: “Alan Joel Gardner hereby
releases and forever discharges Great Oaks Water Company, a California Corporation, as
well as its officers, employees, agents, attorneys, representatives, successors, and assigns,
and each of them, of and from any and all liabilities . . . by reason of any matter or thing
arising from any cause whatsoever prior to the date of execution of this Agreement . . . .”

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accurately reflect the mutual intentions of the parties due to some cognizable ground for
relief such as mutual mistake, the remedy was to seek such relief, not to file a claim for
damages predicated on a misconstruction of the release’s terms.
       Nor did Gardner offer any evidence in support of the premise that Great Oaks
executed the release as an alter ego for Roeder. “In California, two conditions must be
met before the alter ego doctrine will be invoked. First, there must be such a unity of
interest and ownership between the corporation and its equitable owner that the separate
personalities of the corporation and the shareholder do not in reality exist. Second, there
must be an inequitable result if the acts in question are treated as those of the corporation
alone. [Citations.] ‘Among the factors to be considered in applying the doctrine are
commingling of funds and other assets of the two entities, the holding out by one entity
that it is liable for the debts of the other, identical equitable ownership in the two entities,
use of the same offices and employees, and use of one as a mere shell or conduit for the
affairs of the other.’ [Citations.] Other factors which have been described in the case law
include inadequate capitalization, disregard of corporate formalities, lack of segregation
of corporate records, and identical directors and officers. [Citations.] No one
characteristic governs, but the courts must look at all the circumstances to determine
whether the doctrine should be applied. [Citation.] Alter ego is an extreme remedy,
sparingly used. [Citation.]” (Sonora Diamond Corp. v. Superior Court (2000) 83
Cal.App.4th 523, 538-539.)
       Gardner made no attempt to establish any of the foregoing factors. This cannot be
attributed to justifiable ignorance; as Great Oaks’s chief operating officer for nearly five
years, he was presumably familiar with the handling of its funds and assets,
capitalization, observance vel non of corporate formalities, and so on. In any event he
made no attempt to establish justifiable ignorance on any of those points. He simply
declared that Roeder “was the Chairman of the Board of Directors and Chief Executive

                                               4
Officer . . . , owner, and alter ego of [Great Oaks].” This of course is backwards; the
question is not whether Roeder was the alter ego of the entity, such that his separate legal
personality should be disregarded, but whether the Great Oaks was the alter ego of
Roeder, such that its release of Gardner was in effect a release by Gardner. The
complaint alleges, more pertinently, that Great Oaks “is the alter ego for its owner, Chief
Executive Officer, and Chairman of the Board of Directors, and controlling share holder”
Roeder. But both the allegation and the later averment were naked conclusions of law.
“ ‘The allegation that a corporation is the alter ego of the individual stockholder is
insufficient to justify the court in disregarding the corporate entity in the absence of
allegations of facts from which it appears that justice cannot otherwise be
accomplished.’ ” (Vasey v. California Dance Co. (1977) 70 Cal.App.3d 742, 749,
quoting Meadows v. Emett & Chandler (1950) 99 Cal.App.2d 496, 498-499.) “Mere
ownership of all the stock and control and management of a corporation by one or two
individuals is not of itself sufficient to cause the courts to disregard the corporate entity.”
(Meadows v. Emett & Chandler, supra, 99 Cal.App.2d at p. 499.)
       Gardner alleged that Roeder “[h]as a habit of treating corporations as his alter
ego,” and, in apparent support of that allegation, that Canadian regulators found him to
have engaged in certain conduct that resulted in his being “banned from the [British
Columbia] securities market for seventeen (17) years.” The implication, apparently
seemed to suggest that a finding of alter ego status is warranted by a decision of the
British Columbia Securities Commission concerning Roeder’s dealings with respect to a
Canadian enterprise in which he was involved. Assuming any of this were competently
established, its only conceivable relevance would be to show bad character or, more
specifically, a predisposition to abuse the corporate fiction. But of course the general rule
is that “evidence of a person’s character or a trait of his or her character . . . is
inadmissible when offered to prove his or her conduct on a specified occasion.” (Evid.

                                                5
Code, § 1101, subd. (a).) Evidence of other misconduct may be admissible “when
relevant to prove some fact (such as motive, opportunity, intent, preparation, plan,
knowledge, identity, absence of mistake or accident . . .) other than . . . disposition to
commit such an act.” (Id., subd. (b).) But apart from Great Oaks’s execution of the
release at issue here, Gardner never pointed to any specific fact, disputed or otherwise,
that he contended would justify disregard of Great Oaks’s separate legal personality.
Thus the only apparent relevance of the Canadian proceedings was to show that he was
the sort of person who disregards the corporate form, and should therefore be found to
have done so here. Since this is a prohibited inference, the evidence was inadmissible,
and the trial court quite properly ignored it. Echoing the complaint, Gardner asserted in
opposition to the anti-SLAPP motion that Roeder had a “habit” of disregarding the
corporate form. But again, evidence of habitually behaving in a certain manner is
admissible, if at all, “to prove conduct on a specified occasion in conformity with the
habit or custom.” (Evid. Code, § 1105, italics added.) Gardner never attempted to
specify any occasion on which Roeder disregarded the separate corporate personality of
Great Oaks.
       The only specific factual assertion offered by Gardner in support of the alter ego
claim is the allegation that Roeder had “use[d]” Great Oaks “to perpetrate a fraud or
accomplish [an] other wrongful or inequitable act” by “fraudulently inducing
Mr. Gardner to settle all claims against Great Oaks and its owners, agents etc. only to sue
Mr. Gardner again for the exact same causes of actions.” This assertion was repeated in
opposition to the SLAPP motion, but no factual foundation for it was offered. We find
no suggestion in the record that Gardner was justifiably misled as to the scope of the
release. If anything, his own proofs tend to establish the opposite. Attached to his
declaration is an e-mail exchange in which counsel for Great Oaks proposed terms for a
settlement of the original lawsuits. He wrote that the proposal “does not include any

                                               6
releases or waivers by any party as to any claims except by and between Alan Gardner
and [Great Oaks] as to any and all wage claims by Gardner.” Counsel for Gardner
rejected the offer, stating among other things that he was surprised at the failure to offer a
“general release.” He continued: “If your clients do not wish to enter into a mutual
general release, one can only wonder what future litigation they have in mind. Mr.
Gardner considers this a real threat and is prepared to fight fire with fire.” He then
referred to “a list of the actions he is prepared to take in response to future litigation”—a
list not included in the copy of the message in the record.
       Counsel for Great Oaks thus straightforwardly communicated his client’s
unwillingness to release any claims other than its own What further communications
may have preceded the parties’ execution of the settlement agreement is not disclosed by
the record. What clearly appears, however, is that Gardner was on notice that the scope
of the release was an issue. Thus, even if he had shown that he executed the release in
reliance on some deceptive statement or omission by Great Oaks about its scope, he
would have a difficult time persuading any trier of fact that the reliance was reasonable.
       Having been clearly informed of Great Oaks’s intentions, Gardner was obliged for
his own protection to read and understand the release, and to reject it if it failed to
accurately manifest his own intentions. This lawsuit is predicated on investing the
release with a meaning it simply does not possess. The trial court properly found that it
lacked the requisite probability of success.
                                        DISPOSITION
       The judgment is affirmed.




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                                        ______________________________________
                                                   RUSHING, P. J.




WE CONCUR:




____________________________________
           ELIA, J.




____________________________________
           WALSH, J.*




Gardner v. Roeder et al.
H038407



      *
         Judge of the Santa Clara County Superior Court assigned by the Chief Justice
pursuant to article VI, section 6 of the California Constitution.
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