® W 12 13 14 16 7 18, 19 20 21 22 24 25 26 28 LYNNE C. HERMLE (SBN 99779) Ichermle@orrick.com ORRICK, HERRINGTON & SUTCLIFFE LLP. 1000 Marsh Road Menlo Park, CA 94025 Telephone: (650) 614-7400 Facsimile: (650) 614-7401 KAREN G, JOHNSON-McKEWAN (SBN 121570) kjohnson-mekewan@orrick.com ERIN M. CONNELL (SBN 223355) econnell@orrick.com ORRICK, HERRINGTON & SUTCLIFFE LLP The Orrick Building 405 Howard Street San Francisco, CA_ 94105-2669 Telephone: (415) 773-5700 Facsimile: (415) 773-5759 Attorneys for Defendant and Cross-Complainant Netflix, Inc. SUPERIOR COURT OF THE STATE OF CALIFORNIA, COUNTY OF LOS ANGELES, WEST DISTRICT TWENTIETH CENTURY FOX FILM | Case No. $C126423 CORPORATION, a Delaware Corporation, | and FOX 21, INC., a Delaware Corporation, | CROSS-COMPLAINANT NETFLIX, INC.’S OPPOSITION TO Plaintifis, TWENTIETH CENTURY FOX FILM ¥ | CORPORATION AND FOX 21, INC.’S SPECIAL MOTION TO STRIKE NETFLIX’S CROSS- COMPLAINT PURSUANT TO THE CALIFORNIA ANTI-SLAPP STATUTE, CODE OF CIVIL PROCEDURE SECTION 425.16 NETFLIX, INC.,a Delaware Corporation, Defendant. NETFLIX, INC., a Delaware Corporation, Cross-Complainant, Date: January 19, 2017 Time: 8:30 a.m. Dept: K Judge: Hon. Gerald Rosenberg v. TWENTIETH CENTURY FOX FILM CORPORATION, a Delaware Corporation, and FOX 21, INC., a Delaware Corporation, and DOES 1 through 10, Complaint Filed: _ September 16, 2016 Cross-Complaint Filed: October 19, 2016 Cross-Defendants. RES ID: 161129177129 OFS USA:766225526 10 TET FLAS OPPOSITION TO PLAINTIEIS"ANTIST APP MOTION TO STRIKE PURSUANT TOCC PLS DSI6M. mL Iv. VL TABLE OF CONTENTS Page INTRODUCTION... BACKGROUND FACTS... A. Fox’s Complaint... B. _ Netflix’s Cross-Complaint.. $ Cross:Complaint Does Not Arise From Fox's Pre-Litigation Or Litigation Conduet sen D. Fox Engages In Anti LEGAL STANDARD... PRONG I: FOX FAILS TO MEET ITS BURDEN... A. Netflix’s Claims Are Not Based On Pre-Litigation Or Li gation Conduct. 1. Netflix’s Cross-Complaint Is Not Based On Fox’s Litigation Conduet, os 2. Netflix's Allegations Regarding Fox's Enforcement Of lis Contracts Do Not Arise From Fox’s Litigation Activity... B. Any Purportedly Protected Activity Is Incidental To The Core Misconduct PRONG 2: NETFLIX CAN DEMONSTRATE A PROBABILITY OF PREVAILING ON ITS CLAIMS.. A. Fox’s Widespread Use Of Anti-Compet Unlawful And Unfair Business Practice.. 1 Netflix Has Pleaded An Unfair Business Practice. 2. Fox's Anti-Competitive Conduct Violates Sections 16600 And mpettive And Abusive Practices. Dak ive Fixed-Term Agreements Is An 17200 10 3. The Purported Injunctive Relief Section Violates Section 16600... 11 B. _ Netflix’s Declaratory Relief Claim Is Not Duplicative Of Its UCL Claim.. C. _ Netflix’s Claims Are Not Barred By The Litigation Privilege..... eld D. Netflix Has Standing To Assert Its Claims. 1 Netflix’s UCL Claim...... so 2. Netflix’s Declaratory Relief Claim. CONCLUSION...... wie “HETELIN'S OPPOSITION TO PLAINTIFFS” ANTESEAPP MOTION To STRIKE PURSUANT TOCCP. H5.16aaw 10 " 12 13 14 15 16 7 18 19 20 21 22 24 25 26 27 28 TABLE OF AUTHORITIES Page(s) ‘Cases Action Apartment Ass'n., Inc. v. City of Santa Monica, 41 Cal. 4th 1232 (2007) Aguilar v. Goldstein, 207 Cal. App. 4th 1152 (2012). Application Grp., Inc. v. Hunter Grp., Inc., 61 Cal, App. 4th 881 (1998)... Baral v. Schnitt, 1 Cal. Sth 376 (2016)... Bardin v. DaimlerChrysler Corp., 136 Cal. App. 4th 1255 (2006)... 13 Bed, Bath & Beyond of La Jolla, Inc. v. La Jolla Vill. Square Venture Partners, 52 Cal. App. 4th 867 (1997) - Beverly Glen Music, Ine. v. Warner Comme'ns, Inc., 178 Cal. App. 3d 1142 (1986) Brownfield v. Daniel Freeman Marina Hosp. : 208 Cal. App. 34 405 (1989) wn Cal. Ass'n. of PS S v. Cal. Dep't of Educ., 141 Cal. App. 4th 360 (2006) wold Cel-Tech Comme 'ns, Inc. v. L.A. Cellular Tel. Co., 20 Cal, 4th 163 (1999). se 9,10, 11 City of Cotati v. Cashman, 29 Cal. 4th 69 (2002) CRST Van Expedited, Inc. v. Werner Enterprises, Inc., 479 F.3d 1099 (9th Cir. 2007). vse De Haviland ». Warner Bros. Pictures, 67 Cal. App. 2d 225 (1944)... Digerati Holdings, LLC v. Young Money Ent., LLC, 194 Cal. App. 4th 873 (2011) Dyer v. Childress, 147 Cal. App. 4th 1273 (2007)... OfsUSAa-766225526.10 -ii- 'NETELIN'S OPPOSITION TO PLAINTIFFS” ANTL-SLAPP MOTION TO STRIKE PURSUANT TOCCP.§ 42516Edwards v. Arthur Andersen LLP, 44 Cal. 4th 937 (2008) Farmers Ins. Exch. v. Super. Ct., 2Cal. 4th 377 (1992).. Golden v. Cal. Emergency Physicians Med. Grp., 782 F.3d 1083 (9th Cir. 2015)..... 10 Gotterba v. Travolta, 228 Cal. App. 4th 35 (2014) Integrated Healthcare Holdings, Inc. v. Fitzgibbons, 140 Cal. App. 4th 515 (2006)... Kajima Eng’g. & Constr., Inc. v. City of LAs 95 Cal. App. 4th 921 (2002)... Khajavi v. Feather River Anesthesia Med. Grp., 84 Cal. App. 4th 32 (2000) wnnn Kwikset Corp. v, Super. Ct., 51 Cal. 4th 310 (2011) Law Offices of Mathew Higbee v. Expungement Assistance Servs., 214 Cal. App. 4th 544 (2013)... Leep v. Am. Ship Mgmt, LLC, 126 Cal. App. 4th 1028 (2005) sons Lemat Corp. v. Barry, 275 Cal. App. 2d 671 (1969) Navellier v. Sletten, 29 Cal. 4th 82 (2002)... Olson v. Toy, 46 Cal. App. 4th 818 (1996)... Overstock.com, Inc. v, Gradient Analytics, Inc., 151 Cal. App. 4th 688 (2007)... People v. LA. Palm, Inc., 121 Cal. App. 3d 25 (1981)... Perkins v. Super. Ct., 117 Cal, App. 34 1 (1981)... Renewable Res. Coal,, Inc. v. Pebble Mines Corp., 218 Cal. App. 4th 384 2013) nrsonnnnennnn OHSUSA765225526.10 ili - TRETFLIN'S OPPOSITION TO PLAINTIFTS" ANTL-SLAT? MOTION TO STRIKE PURSUANT TOCCP.§ 251610 u 12 2B 14 16 7 18 19 20 2 2 23 24 25 26 27 28 S.F. Design Ctr, Assocs. v. Portman Cos., 41 Cal. App. 4th 29 (1995) Simons v. Kern Coy, 234 Cal. App. 2d 362 (1965). Supervalu, Inc. v. Wexford Underwriting Managers, Inc., 175 Cal. App. 4th 64 (2009) . Touchstone Television Prods. v. Super. Cl., 208 Cal. App. 4th 676 (2012) 12 Statutes Cal, Business and Professions Code § 16600... passim Cal, Business and Professions Code § 17200 “passin Cal, Civil Code § 3423... 11,12 Cal. Civil Code § 3513 . Cal. Code of Civil Procedure § 1060... Cal. Code of Civil Procedure § 425.16... Cal. Code of Civil Procedure § 452 Cal. Code of Civil Procedure § 3423... Cal, Labor Code § 2855.. Other Authorities Rutter: Cal. Prac, Guide Civ. Pro, Before Trial Ch, 7(1)-B..... sive TONTO RANTES ANTS TOSTRRE RRSUANT TOCCE FETEI. INTRODUCTION. Netflix, Inc.’s (“Netflix”) Cross-Complaint challenges Fox’s unlawful use of fixed-term employment agreements in violation of California law. Twentieth Century Fox Film Corporation (“TCFFC”) and Fox 21, Inc. (“Fox 21”) (collectively “Fox") deliberately misconstrue the Cros Complaint in order to try to justify an anti-SLAPP motion. Fox contends that Netflix’s Cross- Complaint arises from protested pre-litigation and litigation activity because Fox threatened and then sued Netflix after Netflix hired two people who were subject to Fox fixed-term employment agreements. But that is not the basis for the Cross-Complaint. Instead, Netflix’s allegations focus on Fox’s unlawful use of fixed-term employment agreements to restrict employee mobility, in violation of Business and Professions Code § 16600. The gravamen of Nettlix’s Cross-Complaint is Fox’s sweeping practice of binding employees to these illegal contracts; not Fox’s litigation activity. Netflix further alleges that Fox’s widespread use of these unlawful contracts is anti-competitive, including because the contracts both misrepresent the character of the employee’s work, and contain the false threat of injunction in the event of the employee’s breach. These contracts, which are based on a model developed for studio talent in the 1940s, and which Fox now has extended over time to unlawfully bind rank-and-file corporate employees, suppress employee mobility, to Netflix’s detriment, Fox’s misleading and unjustified characterization of the Cross-Complaint leaves all of this out, selecting instead a collection of stray phrases, stripped of their context in the pleading. Fox's analysis not only is incorrect, it would lead to absurd results. Under Fox’s analysis, no cross-complaint for declaratory judgment could ever survive an anti-SLAPP motion if it cited pre-litigation threats as part of its allegations to demonstrate the existence of a controversy, or to evidence a pattern of unlawful conduct. Nor could an employee, facing Fox’s threat of injunction, ever seek a declaration of his or her rights under that contract. This, of course, is not the law. Fox's threats of litigation do not shield Fox’s unlawful conduct, nor entitle Fox to anti-SLAPP protection. Netflix’s Cross-Complaint is entirely proper. It simply cites the illegal provisions in the Fox fixed term agreements as evidence of Fox’s oppressive and anti-competitive conduct. For junctive relief only against certain kinds of example, in the case of breach, the law permits i OHSUSA 766225526 10 -1- VETHLIX'S OPPOSITION TO PLAINTIFFS" ANTI-SCAPP MOTION TO STRIKEemployees. Fox knows this, and so in the contracts themselves, it deliherately mischaracterizes the nature of its employees’ work in an attempt to justify the threat of injunction, Further, these contracts have the effect of creating non-competes; they constitute unlawful restraints on employee mobility, are illegal and anti-competitive, and violate § 16600, which codifies Califomia’s public policy proscribing restraints on employee mobility, and which Fox largely ignores in its motion. Moreover, Fox's abusive and coercive business practices regarding the agreements further illustrate its anti-competitive behavior. Fox engages in abusive conduct with employees who try to negotiate the agreements’ terms. Fox pays below-market salaries, but tells employees that the agreements are “take-it-or-leave-it.” Faced with the prospect of unemployment, employees are coerced to enter into, and must agree to, unilateral renewal of Fox’s oppressive contracts. Fox cannot fairly describe these contracting and employment practices as “petitioning” activity protected by California’s anti-SLAPP statute. Because Fox fails to meet its burden of showing that the Cross-Complaint arises from protected activity, the Court’s analysis can end there. But Netflix also can demonstrate it will prevail on its claims in the second half of the anti-SLAPP analysis. Fox claims the Labor Code authorizes its use of anti-competitive agreements, but the law does not afford Fox any such safe harbor. Business and Professions Code §§ 16600 and 17200 both constrain Fox's use of its fixed- term contracts by prohibiting rest of trade and unfair competition, When these statutes and the relevant case law are analyzed collectively, Fox's widespread use of unlawful fixed-term agreements constitutes an unfair and unlawful business practice, causing injury to Netflix. The Court should deny Fox’s motion and award Netflix its fees for opposing the motion, I BACKGROUND FACTS. A. Fox’s Complaint. Fox asserts three claims against Netflix in its Complaint. The first two allege that Netflix induced two former employees of Fox—Marcos Waltenberg and Tara Flynn—to breach their fixed- term employment contracts (“Waltenberg Agreement” and “Flynn Agreement”), and the third alleges unfair competition based on Netflix’s alleged “continuing threat of unlawfully interfering with Fox’s Fixed-Term Employment Agreements.” Compl. $9 23-45. F1SUSA765225526 10 -2- TRETELIN'S OPPOSITION 70 PLAINTIFIS' ANTLSCAPP MOTION TO STRIKE PURSUANT TOCEP. PETGao B, —_ Netflix’s Cross-Complaint, The Cross-Complain: arises from Fox’s imposition of unlawful agreements upon a broad swath of Fox’s full-time, salaried business executives who would typically be at-will employees, and who do not perform services that are of a special, unique, unusual, extraordinary, or intellectual character, as defined under California law. Fox compels them to sign provisions that acknowledge Fox’s (non-existent) right to enforce those contracts through injunction. Through the use of these unlawful fixed-term agreements, Fox imposes a system on its workforce that is intentionally designed to “restrain{] employee mobility, depress[] compensation levels, and create[] unlawful barriers to entry for Netflix” to compete in the same industry in violation of § 16600. Cross-Compl. 41.2. On that foundation, Netflix asserts two causes of action: (j) an unfair competition claim UCL"); and (ii) a declarztory relief claim to determine Netflix’s rights as a competitor as negatively affected by Fox’s widespread use of fixed-term agreements. [d. $f] 28-38. Multiple elements of the Fox contracts contribute to their unenforceability. First, they give Fox a unilateral option (o extend the contract term, thereby forcing employees to work exclusively for Fox for several years and foreclosing any meaningful negotiation, in violation of § 16600. Ia. 4118. The agreements also unlawfully purport to allow Fox to seek injunctive or other equitable relief to prevent a breach, 1é. $Y 15, 18, 20. For example, the Waltenberg and Flynn Agreements both contain the following identically-worded provision that (a) mischaracterizes the employees" job duties as special and unique, and (b) purports to permit Fox from enjoining them from breach: The services to be furnished by you hereunder and the rights and privileges granted to the Company by you are of a special, unique, unusual, extraordinary, and intellectual character which gives them a peculiar value, the loss of which cannot be reasonably or adequately compensated in damages in any astion in law, and a breach by you of any of the provisions. contained herein will cause the Company irreparable injury and damage. ‘You expressly agree that the Company shall be entitled to seek injunctive and other equitaole relief to prevert a breach of this Agreement by you. Resort to such equitable relief, however, shall not be construed as a waiver of any preceding or succeeding breach of the same or any other term or provision. The various rights and remedies of the Company hereunder shall be construed to be cumulative and no one of them shall be exclusive of any other or of any right or remedy allowed by law. Id. 4 24 (emphases added). This provision is unlawful and violates Civil Code § 3423 and Labor Code § 2855, Id. 426. Neitter Ms. Flynn nor Mr. Waltenberg supplied services that were actually OnSUSA:766225526.10 3. —NETELIN'S OPPOSTTION TO PLAINTIFES”ANTT-SLAPP MOTION TO STRIKE PURSUANT TOCCP $05 6Seca unauvaee u 3B 4 16 17 18 19 21 22 24 25 26 2 28 special or unique, and the statutes permit injunctive relief only against individuals who provide such services. Id. 24-26. Netflix alleges that other similarly-situated employees are also subject to these restrictive fixed-term agreements. Id. {] 23, 27. Such widespread use of unlawful restraints on trade are inconsistent with, and unlawful under, §§ 16600 and 17200. Id. 4¥ 24-25, C. — Netflix’s Cross-Complaint Does Not Arise From Fox’s Pre-Litigation Or tion Conduct. Fox claims that that Netflix’s Cross-Complaint is based on “Fox’s assertion of its rights to enforce its fixed-term employment contracts.” Mot. at 5:25-26, That is not the basis of Netflix’s Cross-Complaint. This is: ‘* 415: “Fox engages in the widespread use of unlawfully restrictive fixed-term employment agreements, and requires otherwise typically at-will employees to enter into such agreements as a condition of employment or promotion”; © 17: Fox unreasonably pressures its employees (including but not limited to Waltenberg and Flynn) into signing the agreements; © 23: Fox’s fixed-term agreements generally contain terms similar to the Waltenberg and Flynn Agreements; 27: Fox continues to use fixed-term agreements with some or all of its California employees, which hinders Netflix’s ability to recruit Fox employees; and ‘+ 136: Netflix seeks a judicial declaration because it “wishes to compete fairly to employ other Fox employees” and cannot do so because of Fox’s use of unlawful agreements, Read as a whole, the Cross-Complaint seeks relief for conduct that is not based upon Fox’s litig mn or pre-litigation actions in relation to any individual’s contract; the Waltenberg and Flynn Agreements are mere illustrations of Fox’s anti-competitive conduct. See, e.g, id. $9 20, 23.! Moreover, Netflix’s allegations about Fox’s “enforcement” of its agreements do not refer to litigation or pre-litigation threats at all, but to Fox’s conduct binding its employees to contracts that violate § 16600. For example, Netflix alleges the provision purporting to permit Fox to enforce the agreement by injunction, coupled with Fox’s unilateral option to extend the contract, effectively compels employees to stay with Fox against their will. /d. $9 18, 24. The “threat of litigation” in paragraphs 18 and 24 refers to the contractual provision—“ou expressly agree that the Company shall be entitled to seek injunctive and other equitable relief to prevent a breach of this "in fact, the only reference in the Cross-Complaint to any’ pre-litigation communication is Exhibit D, which Netflix: cites for Fox's demand that Netflix comply with an anti-competitive no-poaching arrangement. Id. 21; Ex. D. ONSUSA 766225526 10 4: NETHLIN'S OPPOSITION TO PLAIN TURSUANTTOCCP § BEG ANTESTAPP MOTION TOSTR10 u 12 13 14 15 16 7 18 19 20 21 22 23 24 25 26 2 28 Agreement by you.” —thal purports to allow Fox to enjoin the employee’s departure, Cross-Compl. ‘{ 18. Netflix’s allegations thus do not equate Fox’s “enforcement” of its fixed-term agreements with Fox’s pre-ltigation or litigation activity, but to Fox’s contracting practices. D. Fox Engages In Anti-Competitive And Abusive Practices. The Cross-Complaint alleges that Fox engages in “selective and abusive enforcement tactics” to force employees to sign fixed-term contracts, in violation of §§ 16600 and 17200. Id. { 19. For example, Ms. Flynn’s supervisor repeatedly “screamed” at her when she tried to negotiate her contract. This abuse continued through Ms. Flynn’s tenure: while already under contract, Fox 21 presented her a fixed-term agreement extending the term and with lower compensation than her peers. Fox 21 refused to negotiate the contract terms, and—given the alternative of unemployment and injunction—coerced her to execute it. Declaration of Tara Flynn (“Flynn Decl.”) {{] 4-14. Mr. Waltenberg experienced similar restraints: in response to a request for a raise, TCFFC threatened to withhold sponsorship of his green card application. Faced with potential deportation, Mr. Waltenberg withdrew his raise request. Declaration of Marcos Waltenberg (“Waltenberg Decl.”) 417. When Mr. Waltenberg later renewed his request for a raise, TCFFC offered him a promotion and raise only if he executed a fixed-term contract. /d. 9. He could not negotiate the terms; TCFFC told him it was a “take it or leave it” offer. Id. Mr. Waltenberg believed his salary was lower than market rate, but he had little choice but to execute the agreement. /d. Neither Ms. Flynn nor Mr. Waltenberg performed any job duties that were unique or extraordinary. Flynn Decl. 118; Waltenberg Decl. $f 10, 17. Their former colleagues transitioned into their positions when they left and there were many others at Fox who performed similar duties. Ad. J§ 18-19; §] 17-18. Both Flynn and Waltenberg attest that there are many other Fox business employees subject to fixed-term agreements like theirs. Id. 419; 4 18. IL LEGAL STANDARD. Code of Civil Procedure § 425.16 requires a two-step process in evaluating a defendant's motion to strike, Code Civ. Proc. § 425.16(b)(1). First, the court must decide whether the defendant has made a threshold showing that the challenged cause of action is one ari activity. See Kajima Eng'g. & Constr., Inc. v. City of L.A., 95 Cal. App. 4th 921, 928 (2002). Only ing from protected = [NETILIN'S OPPOSITION TO PLAINTIFFS” ANTL:SCAPP MOTION TO STRIKE PURSUANT TOCCP $5.16if the claims arise from “the defendant's free expression or petition rights], then the burden shifts to the plaintif?to show a probability of prevailing”. /d.; Baral v. Schnitt, | Cal. 5th 376, 481 (2016) (second step accepts plaintiff's evidence as true, and evaluates “defendant’s showing only to determine if it defeats the plaintiff's claim as a matter of law.”). Only a claim that meets both prongs of the anti-SLAPP statute may stricken. Navellier v. Sletten, 29 Cal. 4th 82, 88 (2002). IV, PRONG 1: FOX FAILS TO MEET ITS BURDE! A. Netflix’s Claims Are Not Based On Pre-Litigation Or Litigation Conduct. Fox has the initial burden to show that Nettlix’s claims arise from protected activity within the meaning of § 425.16(b)(1). To determine whether Fox has met the “arising from” requirements depends on the gravamen of the claim. Renewable Res. Coal., Inc. v. Pebble Mines Corp., 218 Cal. App. 4th 384, 395 (2013). The analysis turns on “whether the defendant's act underlying the plaintiff's cause of action ‘tself was an act in furtherance of the right of petition or free speech.” Dyer v. Childress, 147 Cal. App. 4th 1273, 1279 (2007) (citations omitted) (emphasis original). Under the first prong, the Court must consider the pleadings, and declarations describing the facts upon which liability is based. Digerati Holdings, LLC v. Young Money Ent., LLC, 194 Cal. App. 4th 873, 883-84 (2011). Fox cannot meet this burden. 1, Netflix’s Cross-Complaint Is Not Based On Fox’s Litigation Conduct. Fox’s analysis depends entirely upon the premise that Netflix’s claims arise from Fox’s pre- litigation and litigation conduct regarding the Flynn and Waltenberg Agreements, and Fox's Complaint, Mot. at 6:23+ :8. That premise is patently false; the Cross-Complaint alleges that Fox’s widespread use of illegal fixed-term employment agreements violates § 16600. See, e.g., Cross- Compl. {9 2, 4, 15-19, 23-27, The Cross-Complaint is not limited to the Flynn or Waltenberg Agreements; those agreements only illustrate Fox’s unlawful practices. Id. $f 20-22. Nor does Netflix allege that Fox’s Complaint itself is actionable. Accordingly, Netflix’s claims do not arise from the exervise of its “free speech or petition rights.” Kajima, 95 Cal. App. 4th at 928. 2. Netflix’s Allegations Regarding Fox’s Enforcement Of Its Contracts Do Not Arise From Fox's Litigation Activity. Fox conflates the word “enforcement” in Netflix’s Cross-Complaint with Fox’s litigation O1ISUSA:766225526.10 -6- TNETHLIN S OPPOSITION TO PLAINTIFTS" ANTESLATP MOTION TO STRIKE PURSUANT TOCCR. Yai51610 ul 12 4 15 16 17 19 20 21 22 23 24 25 26 27 28 and pre-litigation activity. Mot. at 5:25-6:7, But the gravamen of the Cross-Complaint is Fox’s use of illegal fixed-term contracts to compel employees to stay against their will, not Fox’s pre- litigation or litigation conduct © 4, framing the “Nature of the Action,” explains that Fox's fixed-term employment agreements are unlawful and unenforceable for three reasons: (a) they unreasonably restrict mobility, stifle competition, and depress salary levels; (b) they contain false statzments that mischaracterize both the nature of the work being performed and the company’s remedy for a breach; and (c) Fox “selectively” enforces them only when employees want to move to a competitor. Paragraph 16 expands on this third reason, focusing on Fox’s selectivity in choosing whether to allow an employee out of her contract, or insisting that she stay. Paragraph 16 does not discuss litigation. © {24 elaborates on $M’s second reason: reference to Fox’s “use of legal threats and injunctions” arises from and is specifically tied to the company’s boilerplate contract provision that mischaracterizes the nature of the work the employee is performing as “special, unique, extraordinary, and intellectual” and, based on that mischaracterization, claims the legal right to compel the employee to stay. It is the use of this illegal provision—and the threat it contains—that hinders Fox employees from leaving Fox for alternative employment. 18 alleges the agreements give Fox unilateral options to extend the contracts’ terms. When this option is “coupled with the threat of litigation to obtain an injunction for attempts to leave their employment with Fox,” employees are effectively compelled to stay at Fox, Id. The “threat of litigation” described in that paragraph refers to the contractual provision purportedly permitting injunctive relief, not to any specific pre- litigation activity by Fox. * {20 identifies the Waltenberg and Flynn Agreements as examples that “illustrate Fox’s unlawful behavior.” Id. 20. They are not the basis of the Cross-Complaint. City of Cotati v, Cashman, 29 Cal. 4th 69, 78 (2002) (“that a cause of action arguably may have beea triggered by protected activity does not entail that it is one arising from such.”). Moreover, reference to “Fox’s selective and abusive enforcement tactics,” in paragraph 19, describes Fox's coercive tactics with its employees to secure their signature on fixed-term agreements (see Flynn. Decl. $9 4-14; Waltenberg Decl. §f17, 9), and the circumstances of its refusal to consent to early termination. Cross-Compl. 16. This is not litigation conduct, tut plainly an anti-competitive business practice. Netflix’s allegations are comparable to conduct the Kajima court concluded was not protected. In Kajima, the complaint referred to Kajima’ threats to file lawsuits, and Kajima moved to strike under the anti-SLAPP statute. Kajima, 95 Cal. App. 4th at 930. The Second District denied the motion; the litigation threats were “part of the [plaintiff's] allegations regarding Kajima’s general pattern and practice of bidding and collecting” on projects. Jd. at 930-31. The On1suSA-766225526.10 -7- [NETFLIN'S OPPOSITION TO PLAINTIFFS" ANTT-SCAPP MOTION TO STRIKE PURSUANT TO CCP. § 5.16alleged wrongdoing did not relate to the filing of the underlying complaint, and was “not the basis for liability asserted in any of the causes of action.” /d. at 931. Likewise, Netflix’s allegations are entirely focused on Fox's unlawful use of the agreements to restrict employee mobility. The gravamen of Netflix’s Cross-Complaint is Fox’s sweeping practices of binding its employees to illegal contracts in violation of § 16600, not Fox’s li gation activity B. Any Purportedly Protected Activity Is Incidental To The Core Misconduct. Even if the Court did find that some of Netflix’s allegations concern protected activity, Fox still cannot meet its burden on the first prong because any allegations concerning protected activity are at best “merely incidental” or “collateral,” and thus are not the subject of § 425.16. Baral, 1 Cal. Sth at 394; see also id, (“Allegations of protected activity that merely provide context, without supporting a claim for recovery, cannot be stricken under the anti-SLAPP statute.”). If the protected activity is only “incidental to a cause of action based essentially on nonprotected activity, then the anti-SLAPP statute does not apply.” Aguilar v, Goldstein, 207 Cal. App. 4th 1152, 1160 (2012). Any mention in the Cross-Complaint to purportedly protected activity only provides context for Fox’s anti-competitive conduct; it does not form the basis for the claims. As noted above, the gravamen of the Cross-Complaint is that Fox’s use of, and practices concerning, fixed term employment contracts is anti-competitive. Descriptions of the Waltenberg and Flynn Agreements provide context for the terms of agreements binding other similarly-situated business employees. Cross-Compl. $20, 24. Netflix offered Exhibit D to the Cross-Complaint to evidence Fox’s anti- competitive intent with respect to the employment contracts, not to demonstrate Fox’s attempts to enforce the contracts through litigation, Paragraphs 18 and 24 refer to Fox’s baseless legal threats—embedded in the contracts—to intimidate Fox employees from leaving, in violation of §16600. In deciding a SLAPP motion, the court must distinguish between speech that is “mere evidence related to liability, and liability that is based on speech or petitioning activity.” Gotterba v. Travolta, 228 Cal. App. 4th 35, 42 (2014) (emphasis original); see id. at 41-42 (the “complaint is not based upon Alto’s saber-rattling demand letters;” the letters are just evidence that a controversy exists). Netflix’s claims of liability are not based on Fox’s purported litigation conduct, and to construe Nettlix’s allegations as an attack on protected speech would lead to the absurd result O1SUSA:766225526 10 ‘NETELIN'S OPPOSTTION TO PLAINTIFES" ANTESLAPP MOTION TO STRIKE PURSUANTTOCCP $0516of striking any declaratory judgment complaint that follows receipt of a litigation threat? Fox has not met its burden under Prong 1. The Court’s inquiry should stop here. PRONG 2: NETFLIX CAN DEMONSTRATE A PROBABILITY OF PREVAILING ON ITS CLAIMS. Even if Fox could meet the first prong of the SLAPP statute, Netflix will prevail on its §17200 and declaratory relief claims. Netflix is entitled to “a certain degree of leeway in establishing a probability of prevailing on its claims due to ‘the early stage at which the [anti- SLAPP] motion is brought and heard [citation] and the limited opportunity to conduct discovery [citation]. Integrated Healthcare Holdings, Inc. v. Fitzgibbons, 140 Cal. App. 4th 515, 530 (2006). In evaluating Netilix’s showing, “[wle do not weigh credibility, nor do we evaluate the weight of the evidence. Instead, we accept as true all evidence favorable to the plaintiff and assess the defendant's evidence only to determine if it defeats the plaintiff's submission as a matter of law.” Overstock.com, Inc. v. Gradient Analytics, Inc., 151 Cal. App. 4th 688, 699-700 (2007). A. Fox's Widespread Use Of Anti-Competitive Fixed-Term Agreements Is An Unlawful And Unfair Business Prac 1. Netflix Has Pleaded An Unfair Business Practi Netflix has pleaded that Fox’s practices are both unfair and unlawful business practices. Mot. at 8:19-9:2, When a competitor pleads unfair conduct that violates § 17200, “the word ‘unfair’ in that section means conduct that threatens an incipient violation of an antitrust law, or violates the policy or spirit of one of those laws because its effects are comparable to or the same as a violation of the law, or otherwise significantly threatens or harms competition.” Cel-Tech Comme 'ns, Ine. v. L.A, Cellular Tel. Co., 20 Cal. 4th 163, 187 (1999). Nettlix’s allegations meet this standard. Netflix alleges that Fox’s use of fixed-term employment agreements “restrains employee mobility, depresses compensation levels, and creates unlawful barriers to entry for Netflix” in violation of § 16600. Cross-Compl. 2. Netflix further alleges Fox’s business practices stifle competition, restrain employee mobility, and chill and deter Of Goterba, 228 Cal. App. Ath at 42 (“Acceptance of [defendant] Alto's arguments would lead tothe absurd results that a person receiving a demand leter threatening legal action for breach of contract would be precluded from seeking declaratory relief to determine the validity ofthe contract. Declaratory relief would be limited to situations where the parties have not communicated their disagreement regarding an asserted breach of contract.") OfSUSA-765225526 10 —~RETFLIR'S OPPOSTTION TO PLAINTIFFS" ANTUSLAPP MOTION TO STRIKE PURSUANT TOCCR.EaI516® competitors, including Netflix, from recruiting Fox's employees. See id. §¥ 15-19; 24-27. Finally, Netflix alleges in the first cause of action that Fox’s actions “constitute an wnfair, unlawful and/or fraudulent business practice under California Business and Professions Code section 17200." Id. 4 31. (Emphasis added). Netflix has properly pleaded that Fox’s conduct constitutes an unfair business practice under § 17200, particularly in light of California’s liberal pleeding standards.? 2. Fox's Anti-Competitive Conduct Violates Sections 16600 And 17200. Section 17200 makes actionable (1) any business practices forbidden by law and (2) any business practices that violate the policy and spirit of one of those laws, or otherwise threaten or harm competition.’ Netflix can demonstrate that Fox’s use of fixed-term agreements is both an unlawful and unfair business practice in violation of §§ 16600 and 17200. In pertinent part, § 16660 provides that “every contract by which anyone is restrained from engaging in alawful profession, trade, or business of any kind is to that extent void.” Section 16600 codifies the strong legislative policy in favor of employee mobility and is opposed to any contract that seeks to limit competition, See Edwards v. Arthur Andersen LLP, 44 Cal. 4th 937, 946 (2008) (§ 16600 reflects settled legislative policy in favor of open competition and employee mobility) While § 16600 proscribes noncompetition agreements generally, § 17200, er seg. provides a cause of action for “any unlawful, unfair or fraudulent business act or practice.” See Application Grp., Inc. v. Hunter Grp., Inc., 61 Cal. App. 4th 881, 907 (1998) (if employer's practice violates Section 16600, it may also constitute an unlawful business practice under § 17200). Fox’s fixed-term employment contracts are void under §§ 16600 and 17200. They permit Fox the unilateral right to extend the length of employment for additional years, thereby restraining an employee's freedom to leave his job. See Edwards, 44 Cal. 4th at 94647 (any restraint on trade, no matter how narrow or reasonable, violates § 16600); Golden v. Cal. Emergency Physicians Med. > Civ. Proc. Code § 452 (“In the construction ofa pleading, for the purpose of determining is eect, its allegations must be liberally construed, with a view to substantial justice between the parties.”); Simons v. Kern Cty., 234 Cal ‘App. 2d 362, 367 (1965) (“California is committed to te rule of liberal constuction of pleadings"); Perkins v. Super Ct, 117 Cal! App. 3d 1, 6 (1981) (“What is important is that the complaint as a whole contain suficient facts to apprise the defendant ofthe basis upon which the plantfTis seeking relief.) "See Farmers Is. Exch, v, Super. Ct, 2 Cal, Ath 377, 383 (1992) (unlawful business practice includes “anything that ean properly be called a business practice and that at the same time is forbidden by law.""); Cel-Tech, 20 Cal. ath 163 at 187 (unfair business practice violates spirit or policy of antitrust law or threatens competition). Unfair competition law is derivative in that it “borrows” violations of other laws and treats them as unlawful practices. Farmers, 2 Cal. Ath at 383. uss 7662255510 =10- TRETFLIN'S OPPOSTTION TO PLAINTIFIST ANTI-SLAPF MOTION TO STRIRE PURSUANT TO CCP. S316Grp., 782 F.3d 1083, 1086, 1092 (9th Cir. 2015) (Section 16600 proscribes “any ‘restraint of a substantial charecter,’ no matter its form or scope.”). In addition, Fox’s coercive and abusive tactics force their employees into these fixed-term agreements, giving them no opportunity to negotiate, further evidencing the restraints on trade. See, e.g., Flynn Decl. $f] 4-14; Waltenberg Decl. §{]7, 9. Ms. Flynn and Mr. Waltenberg are not the only Fox employees subject to agreements of this nature, and who cannot leave their employment as desired. See Flynn Decl. $f] 16, 19; Waltenberg Decl. 18; Declaration of Iva Colter $¥ 2-3.5 Moreover, Fox’s practices concerning its fixed-term agreements allow Fox to pay its employees below-market salaries, giving Fox an unfair advantage over competitors who do not use unlawful contracts. Depressed wages and the harm to Fox’s competitors through the use of these agreements further illustrate Fox’s anti-competitive practices in violation of § 17200. Cel- Tech, 20 Cal. 4th at 187 (holding “unfair” practices are those that significantly threaten or harm competition). 3. The Purported Injunetive Relief Section Violates Section 16600. The fixed-term agreements are further void because they purport to permit Fox injunctive relief to prevent employees from breach. But the law permits Fox no such remedy. Nor do the Labor Code sections that Fox cites authorize the agreements Netflix seeks to invalidate. Mot. at 8:17-10:4.6 To the contrary, they impose limitations on fixed-term employment contracts. Indeed, far from authorizing Fox's conduct, the primary statute upon which Fox relies— Labor Code § 2355—instead places two limitations on the use of personal service contracts: (a) they are not enforceable beyond seven years; and (b) if the contract is otherwise valid, it can be enforced by specific enforcement only where the promised “service is of a special, unique, unusual, extraordinary, or intellectual character.” Emphasis added; see also Civ. Code § 3423 As to the second limitation, not only are the Fox contracts invalid under § 16600, but case + Netflix anticipates discovery at a later stage will reveal evidence of additional employees unlawfully restrained from leaving their employment at Fox, despite their desire to do so. In fact, some of tie provisions Fox cites are irrelevant. Labor Code § 2922 refers to at-will employees who may terminate employment at any time; § 2920 identities certain events—such as death of the employee—that trigger termination of the employment; §§'2924 and 2925 acknowledge that an employee or employer subject t0 specified term may terminate if either wilifully breaches; and § 2926 entitles an employee who is dismissed and not subject to a specified term to receive compensation for serviees up to the dismissal. None authorizes the fixed-term agreements that Fox forces upon its employees. OUSUSA-766225526.16 -ll- ‘NETILIN'S OPPOSITION TO PLAINTIFES” ANTL.SLAPP MOTION TO STRIKE PURSUANTTOCCP paS.16law makes clear that services of a unique and extraordinary character subject to these statutes are ited to artists or other celebrities, not business management employees. See, e.g., Lemat Corp. v, Barry, 275 Cal. App. 2d 671 (1969) (enjoining “star” professional basketball player from joining a rival team); De Haviland v. Warner Bros. Pictures, 67 Cal. App. 2d 225, 230 (1944) (“[E]mployers holding contracts for the exclusive services of artists (a term we use to denote all of ). Comme'ns, Inc., 178 Cal. App. 3d 1142, 1144 (1986) (“California courts will not enjoin the breach those who contract to render ‘exceptional service }; Beverly Glen Music, Inc. v. Warner ofa personal service contract unless the service is unique in nature”), There are no cases in which a business employee like Ms. Flynn or Mr. Waltenberg was found to tender unique and extraordinary services subject to injunction under § 2855. Fox is just wrong when it insists the courts have validated its fixed-term employment contracts. ? Nor can Fox show that its salaried business employees, like Ms. Flynn and Mr, Waltenberg, all provide service of “special, unique, unusual, extraordinary, or intellectual character, which gives it peculiar value” in their job duties at Fox. Waltenberg Decl. 417; Flynn Decl. 18. Nevertheless, Fox inserted intimidating and legally unsupportable contract language purporting to entitle it to injunctive relief if the employee breached by choosing, for example, to resign to seek different professional opportunities or a higher salary on the open market. Civ. Code § 3423(e); Lab. Code § 2855; e.g., Flynn Decl. 4116. Cal. Civ. Code § 3513 instructs that “a law established for a public reason cannot be contravened by a private agreement.” See also De Haviland, 67 Cal. App. 2d at 236 (the rights of employees under § 2855 fall squarely within the prohibition of § 3513). Because § 2855 was established for a public reason, Fox cannot simply waive this statutory protection by inserting boilerplate contract language describing every business employee as “unique.” 7 Fox asserts that courts have “repeatedly interpreted, enforced, and recognized the validity of these unremarkable contracts, frequently atthe insistence and for the benefit of the employee.” Mot. at 10:26-28. None of the cases Fox cites involve contracts restraining employees who render “unique or extraordinary” services, involve a section 16600 challenge, or involve an employer attempting to enjoin an employee from working for a competitor. See CRST Van Expedited, Inc. v. Werner Enterprises, in, 479 F.34 1099, 1112-13 (9th Ci. 2007) (ccurt did not grant an injunction for fixed-term contract, noting only remedy was damages); Touchstone Television Prods. v. Super. Ct, 208 Cal. App. 4th 676, 683 (2012) (no discussion of enforceability of fixed-term agreements); Leep v. Am. Ship Mem, LLC, 126 Cal ‘App. Ath 1028, 1038 (2005) (didnot interpret or enforce a fixed-term contract); Khajavi v. Feather River Anesthesia “Med. Grp., 84 Cal. App. 4th 32, 58-59 2000) (no injunction granted where employer terminated employee in violation of fixed-term contract). Similarly, none of the eases Fox cites in footnote 9 of ils Motion, Mot, at 11:23-28, involve the enforcement of the contact through injunctive relief, Thus, while courts have interpreted fixed-term contracts, they have not interpreted them to enjoin non-unique business employees from working for competitors OHSUSA765225526 10 -12- NETL "S OPPOSTTION TO PLAINTIFFS” ANTLSLAPP MOTION TO STRIKE PURSUANT TO CCP §a95 1Fox misconstrues the Labor Code and the case law interpreting it in claiming both have repeatedly authorized their fixed-term agreements.* Instead, these contracts violate the Labor and Civil Codes, and constitute anti-competitive business practices. Fox's arguments that the Labor Code forecloses Netflix’s claims are red herrings.? Fox ignores that the Labor Code must be read in conjunction with §§ 16600 and 17200, See People v. L.A. Palm, Inc., 121 Cal. App. 34 25, 33 (1981) (the Labor Code cannot foreclose remedies under the Business and Professions Code “if the alleged misconduct does indeed constitute an unfair business practice”); Application Grp., 61 Cal. App. at 901 (§ 16600 as implemented through §§ 17200 and 17204 “ensures that California employees will be able to compete effectively for the most talented, skilled employees in their industries”). Because § 2855 does not allow an employer to enjoin a non-unique employee from working for a competitor, it does not foreclose Netflix’s claims. B. _Netflix’s Declaratory Relief Claim Is Not Duplicative Of Its UCL Claim, Fox argues that Netflix’s claim for declaratory relief fails because it is duplicative of the UCL claim, Mot, at 11:22-12:10. They are not duplicative claims; they require different pleading and proof. To state a claim for declaratory relief, Netflix must allege (1) a proper subject, and (2) an actual controversy. See Brownfield v. Daniel Freeman Marina Hosp., 208 Cal. App. 34 405, 410 (1989). It does not require proof of economic injury or causation, whereas a UCL claim requires both. See, e.g., Kwikset Corp. v. Super. Ct, $1 Cal. 4th 310, 322 (2011), Netflix meets the standard for declaratory relief. Code of Civil Procedure § 1060 states that any party who has an interest in a contract may seek relief regarding the rights and duties under that contract. See e.g., Application Grp., 61 Cal. App. 4th at 893-94 (plaintiff third party employer * One ofthe more misleading examples of Fox's brie sits reliance on a long quote from the De Haviland opinion to support its claim that the cited Labor Code sections are “the Legislature's expression of the ‘public policy" when it comes to fixed-term contracts” Mot. a 10:14-25. This quote is taken completely out of context; the De Haviland curt was discussing the reasons why the Labor Code limits fixed term contracts to seven years, an issue not relevant here, De Haviland, 67 Cel, App. 2d at 235, ° For example, Fox contends the competitor privilege bars Netflix’s claims. This is just wrong: the competition privilege is only a defense to tortious interference claims. See, eg, Bed, Bath & Beyond of La Jolla, Ine. . La Jolla Hill. Square Venture Partners, 52 Cal. App. 4th 867, 881 (1997) (competition privilege permits interference with competitor's prospective contractual relationship as long as the interfering conduct is not independently wrongful). Netflix alleges no interference claims. Second, the competition privilege is permitted only ifthe party asserting the privilege is acting lawfully. S.F. Design Cir. Assocs. v. Portman Cas, 41 Cal. App. 4th 29, 42 (1998) (competition privileged defeated “where defendant engages in unlawful or illegitimate means."). Fox's conduct violates Section 16600, See Section V.A, The competition privilege does not bar any of Netflx's claims. On'SUSA-766225526.10 -13- THETFLINS OPPOSTTION TO PLAINTIFFS” ANTESCAPP MOTION TO STRIKE PURSUANT TOCCP YET10 W 12 13 14 15 16 17 18 19 20 2 22 24 25 26 27 28 had standing to request declaratory judgment regarding defendant employer's use of noncompetition agreements with its employees).'? Here, Netflix’s rights are directly affected by these agreements because they inhibit Netflix from recruiting Fox’s employees, thereby chilling Neitflix’s ability to compete. Cross-Compl. { 27. Moreover, Fox has complained publicly that Netflix is engaged in a “systematic, targeted” recruiting campaign (Declaration of Catherine L Ex. A); it cannot now complain that there is no controversy ripe for adjudication.'! C. _ Netflix’s Claims Are Not Barred By The Litigation Privilege. Netilix’s claims are not barred by the litigation privilege. The litigation privilege only protects communications in furtherance of the litigation and relate to “litigation that is contemplated in good faith and under serious consideration.” Action Apartment Ass'n., Inc. v. City of Santa Monica, 41 Cal, 4th 1232, 1251 (2007). As discussed above, the concuct upon which Netflix sues is not in furtherance of Fox’s litigation. See Section IV. D. Netflix Has Standing To Assert Its Claims. 1. Netflix has standing to assert both claims against Fox. To allege standing under the UCL, Netflix must “establish a loss or deprivation of money or property sufficient to qualify as an injury in fact, ie., economic injury,” and show that the economic injury was caused by the unfair business practice. Kwikser Corp., 51 Cal. 4th at 322. There are many ways to show economic injury, particularly when a competitor alleges a UCL claim. /d. at 323. See, e.g, Overstock.com, 151 Cal. App. 4th at 716 (allegations of diminished assets and reduced market capitalization adequately alleged starding); Law Offices of Mathew Higbee v. Expungement Assistance Servs.,214 Cal. App. 4th 544, 557-588 (2013) (lawyer had standing to sue non-lawyer company by alleging diminished value of law practice through loss of market share and increased advestising costs). "° See also Olson v. Toy, 46 Cal. App. ath 818, 820-25 (1996) (Section 1060 “does not require that plaintiffs and defendants be partes to, or that plaintiffs be interested under, a legal instrument as « predicate to plaintiffs ‘maintaining a declaratory relief action.”) Fox also asserts Netflix's declaratory relief claim fails because “[a] request for declaratory relief will not create a ceause of action that otherwise does not exist.” Mot. a 12:4-5. The cases it cites in support are inapposite, as plaintiffs in both cases failed to plead the existence of an actual, present controversy. See Cal. Ass'n. of PSES v. Cal. Dep't of Educ., 141 Cal. App. 4th 360, 377-378 (2006) failed to allege that the challenged regulation had actually been applied; thus, the “as applied” declaratory relief claim failed); Bardin v. DaimlerChrysler Corp. 136 Cal. App. Ath 1255, 1276- 71 (2006) (failed to allege facts suicient to state actual, present controversy). Netix, on the other hand, has pleaded the existence of an actual, present controversy. 11SUsA766225526.10 -14- ‘NETFLIN'S OPPOSITION TO PLAINTIFFS ANTT-SCAPP MOTION TO STRIKE PURSUANT TO CCR. VSG10 WL 12 13 14 15 16 7 18 19 20 21 22 23 24 25 26 27 28 Netflix has met both prongs of Kwikset in its pleading. Netflix alleges that Fox’s anti- competitive use of the fixed-term agreements has impaired Netflix’s ability to compete effectively for talent, and that the wrongful conduct “chills and deters competitors, including Netflix, from soliciting, recruiting and hiring Fox’s California employees”. Cross-Compl. § 27; see id. §f] 2, 16, 19, 27; Colter Decl. 4 3. Fox’s unlawful conduct has caused Netflix lost money or property and denies Netflix the “ability to fairly compete for Fox employees, who are unlawfully restrained from considering employment with Netflix because of Fox’s use of fixed-term employment agreements.”” Id. § 32; Colter Decl. | 3. Netflix has properly alleged the requisite economic injury to its ability to fairly compete and hire the best talent under California's liberal pleading standards. Civ. Proc. Code § 452; Rutter: Cal. Prac. Guide Civ. Pro. Before Trial Ch. 7(1)-B (“conclusory allegations will not be stricken where they are supported by other, factual allegations in the complaint.”) 2. Netflix’s Declaratory Relief Cl: Fox argues Netflix lacks standing because its declaratory relief claim addresses past wrongs regarding Waltenberg and Flynn. Mot, at 15:8-9. But For ignores Netflix’s requested relief, seeking the opportunity to compete fairly to employ other Fox employees. Cross-Compl. 4 36. Finally, Netflix’s declaratory relief claim is not superfluous. Mot. at 15:19-20. Netflix is entitled to a determination of prospective employees’ rights under their current agreements with Fox, particularly since Fox could dismiss its own claims unilaterally. See Supervalu, Inc. v. Wexford Underwriting Managers, Inc., 175 Cal. App. 4th 64, 83 (2009) (same issue of contract interpretation raised in other claims does not bar declaratory relief of that cause of action). VI. CONCLUSION. For the foregoing reasons, the Court should deny Fox’s Motion to Strike and award Netflix its fees in opposing this motion as the motion is frivolous and/or is solely intended to cause unnecessary delay pursuant to section 425.16(c)(1). Dated: January 5, 2017 ORI rf SUTCLIFFE LLP fendant and Cross- NETFLIX, INC. OUSUSA.766225526 10 -15- 'NETELINS OPPOSITION TO PLAINTIFFS” ANTLSLAP? MOTION TO STRIKE PURSUANT TOCCP P2516