Matossian v. Fahmie

Opinion

The question of this appeal is whether holders of licenses to purvey alcoholic beverages have a right, in combination, to protest the granting, or transfer, of a similar license for the sole purpose of preventing or limiting competition. We conclude they have such a right of protest and affirm the judgment of the superior court. Our reasons follow.

Pursuant to its constitutional authority the Legislature has provided that an application for, or transfer of, a license shall be granted by the Department only if, after “a thorough investigation” (italics added), it is found to be consistent with the public welfare and morals. And it has ordained that the constitutional criteria are not ordinarily served if the license’s issuance “would tend to create a law enforcement problem, or if issuance would result in or add to an undue concentration of licenses and the applicant fails to show that public convenience or necessity would be served by such issuance.” (Bus. & Prof. Code, § 23958; italics added.)

In the course of its legislatively directed thorough investigation the Department requires “public notice” of the application to interested persons whose views whether it comports with the public welfare and morals, are invited by way of timely written “protests.” (Bus. & Prof. Code, §§ 23985, 23986.) Any interested person has a right to express his views by filing such a protest (Bus. & Prof. Code, § 24013), and a right to a hearing thereon (Bus. & Prof. Code, §§ 24015, 24300).

Further implementation of the constitutional and statutory directions appears in printed “Instructions for preparing and filing protests” which are widely disseminated by the Department. They provide that protests shall set forth specific objections such as: “Issuance of the license to the premises would result in or add to undue concentration of licenses” (italics added; and see Bus. & Prof. Code, § 23958), or “would interfere with the quiet enjoyment of their property by the residents of the area,” or with the “respective functions” of a nearby “school, church, hospital or children’s public playground.... ”

The plaintiffs Matossian were proprietors of a delicatessen in the City of Berkeley located just beyond the area within “one mile” from

For the purpose of clarifying the issues the several defendants in the superior court, and now here, concede, arguendo, “the existence of a conspiratorial motive to prohibit excessive competition.”

Defendants’ general demurrers to the malicious prosecution and tortious interference with a business, and abuse of process, counts of the complaint were sustained without leave to amend. And thereafter, on defendants’ motion, an order granting summary judgment on the remaining conspiracy to prevent competition count was entered. It is from the ensuing judgment of dismissal of their action that plaintiffs have appealed.

We find the following principles generally apposite to the appeal.

In determining constitutional issues such as impairment of the First Amendment right of petition, and where as here the facts are without substantial controversy, the question “is one of law [for the reviewing court] and not of fact,...” (L. A. Teachers Union v. L. A. City Bd. of Ed. (1969) 71 Cal.2d 551 , 556 [ 78 Cal.Rptr. 723 , 455 P.2d 827 ].)

The right of petition to governmental agencies, like freedom of speech, of the press, and of religion, has “a paramount and preferred place in our democratic system.” (American Civil Liberties Union v. Board of Education (1961) 55 Cal.2d 167 , 178 [ 10 Cal.Rptr. 647 , 359 P.2d 45 , 94 A.L.R.2d 1259 ] [cert. den., 368 U.S. 819 ( 7 L.Ed.2d 25 , 82 S.Ct. 34 )].) “All these, though not identical, are inseparable.” (Thomas v. Collins (1945) 323 U.S. 516 , 530 [ 89 L.Ed. 430 , 440, 65 S.Ct. 315 ].) “Congress shall make no law... abridging... the right of the people... to petition the Government for a redress of grievances.” (U. S. Const., 1st Amend.) “The people have the right to...petition government for redress of grievances,...” (Cal. Const., art. I, § 3.)

“‘The very idea of a government... implies a right on the part of its citizens... to petition for a redress of grievances.’” (De Jonge v. Oregon (1937) 299 U.S. 353 , 364 [ 81 L.Ed. 278 , 284, 57 S.Ct. 255 ].) “[A]ny attempt to restrict those liberties must be justified by clear public interest, threatened not doubtfully or remotely, but by clear and

The right to petition for redress of grievances is not confined to “religious or political” matters. (Thomas v. Collins, supra, 323 U.S. 516 , 531 [ 89 L.Ed. 430 , 441].) “[Commercial speech, like other varieties, is protected” by the First Amendment. (Va. Pharmacy Bd. v. Va. Consumer Council (1976) 425 U.S. 748 , 770 [ 48 L.Ed.2d 346 , 363, 96 S.Ct. 1817 ].) “[I]t would be destructive of rights of association and of petition to hold that groups with common interests may not... use the channels and procedures of state and federal agencies and courts to advocate their causes and points of view respecting resolution of their business and economic interests vis-a-vis their competitors.” (California Transport v. Trucking Unlimited (1972) 404 U.S. 508 , 510-511 [ 30 L.Ed.2d 642 , 646, 92 S.Ct. 609 ]; italics added.)

Where administrative agencies such as the Department must make factual determinations “‘the widest possible dissemination of information from diverse and antagonistic sources is essential to the welfare of the public,...’” (Weaver v. Jordan (1966) 64 Cal.2d 235 , 245 [ 49 Cal.Rptr. 537 , 411 P.2d 289 ] [cert. den., 385 U.S. 844 ( 17 L.Ed.2d 75 , 87 S.Ct. 49 )]; italics added.)

Nor does the right of the people to petition government depend upon “motivation” or “purpose.” It is what is done that is significant. (See Mine Workers v. Pennington (1965) 381 U.S. 657 , 670 [ 14 L.Ed.2d 626 , 636, 85 S.Ct. 1585 ]; Weiss v. Willow Tree Civic Ass’n (S.D.N.Y. 1979) 467 F.Supp. 803 , 817; Sierra Club v. Butz (N.D.Cal.

In furtherance of these principles it is held that: “The right to have one’s voice heard and one’s views considered by the appropriate governmental authority” (Williams v. Rhodes (1968) 393 U.S. 23 , 41 [ 21 L.Ed.2d 24 , 37, 89 S.Ct. 5 ], Harlan, J., conc.) may not be conditioned by a state upon “the exaction of a price” (Garrity v. New Jersey (1967) 385 U.S. 493 , 500 [ 17 L.Ed.2d 562 , 567, 87 S.Ct. 616 ]), or “punishment” (Thornhill v. Alabama (1940) 310 U.S. 88 , 101-102 [ 84 L.Ed. 1093 , 1102, 60 S.Ct. 736 ]), or “threat of criminal or civil sanctions” (Nebraska Press Assn. v. Stuart (1976) 427 U.S. 539 , 559 [ 49 L.Ed.2d 683 , 698, 96 S.Ct. 2791 ]). For such is the “policy of protecting the First Amendment against possible chilling influences.” (Garvin v. Rosenau (6th Cir. 1972) 455 F.2d 233 , 239; and see Shapiro v. Thompson (1969) 394 U.S. 618 , 631 [ 22 L.Ed.2d 600 , 613, 89 S.Ct. 1322 ]; United States v. Jackson (1968) 390 U.S. 570 , 582 [ 20 L.Ed.2d 138 , 147, 88 S.Ct. 1209 ].)

“It is generally agreed that the liquor industry is one which greatly affects the public health, safety, welfare and morals of the people.... Each applicant for a license... must subject himself and the premises where the business will be conducted to a thorough investigation.” (Duke Molner etc. Liquor Co. v. Martin (1960) 180 Cal.App.2d 873 , 880-881 [ 4 Cal.Rptr. 904 ] [cert. den., 364 U.S. 870 ( 5 L.Ed.2d 92 , 81 S.Ct. 112 )]; and see authority there collected.)

We are persuaded by the foregoing authority and considerations that where, as here, a statute expressly invites or allows interested persons to protest, or give their views or opinions concerning, proposed or requested governmental administrative action, such persons singly or in combination have a lawful right to do so; in such a case the law will not permit judicial or other inquiry into the persons’ purpose or motivation. As said in Paskle v. Williams, supra, 214 Cal. 482 , 487. “the motive, even if malicious, of defendants is unimportant if legal groüñ3~"existed upon which to predicate” their protests. Such a right may not be defeated, or abridged, or “chilled,” by threat or fear of civil action for exercising it.

Adverting now to the abuse of process count of the complaint, we observe that the subject process consisted of defendants’ unsuccessful protests and their subsequent appeal to the Appeals Board. As was noted in respect of the malicious prosecution and interference with a business count, here also defendants had a constitutional and statutory right to take the proceedings instituted by the questioned process.

The defendants’ demurrer to the abuse of process count was properly sustained.

As noted, the judgment as to the remaining count of the complaint was summary. That count was based on the theory of defendants’ violation of the state’s Cartwright Act (Bus. & Prof. Code, §§ 16700-16758) which proscribes “Combinations in Restraint of Trade.” The act generally is patterned after the federal Sherman Anti-Trust Act ( 15 U.S.C. § 1 et seq.), “and decisions under the latter act are applicable to the former.” (Corwin v. Los Angeles Newspaper Service Bureau, Inc. (1971) 4 Cal.3d 842 , 852 [ 94 Cal.Rptr. 785 , 484 P.2d 953 ]; italics added.)

The dispositive authority of the issue before us, we opine, is Eastern R. Conf. v. Noerr Motors (1961) 365 U.S. 127 [ 5 L.Ed.2d 464 , 81 S. Ct. 523 ] (hereafter Noerr).

In a not dissimilar context Noerr instructs in the following manner: “We accept, as the starting point for our consideration of the case, the same basic construction of the Sherman Act adopted by the courts below—that no violation of the Act can be predicated upon mere attempts to influence the passage or enforcement of laws.” (365 U.S., p. 135 [5 L.Ed.2d, p. 470]; italics added.)

“. . . The right of the people to inform their representatives in government of their desires with respect to the passage or enforcement of laws cannot properly be made to depend upon their intent in doing so. It is neither unusual nor illegal for people to seek action on laws in the hope that they may bring about an advantage to themselves and a disadvantage to their competitors.... Indeed, it is quite probably people

The same principle was emphasized by the nation’s high court in Mine Workers v. Pennington, supra, 381 U.S. 657 , 670 [ 14 L.Ed.2d 626 , 636]: “Noerr shields from the Sherman Act a concerted effort to influence public officials regardless of intent or purpose.... [If] ... Joint efforts to influence public officials do not violate the antitrust laws even though intended to eliminate competition. Such conduct is not illegal, either standing alone or as part of a broader scheme itself violative of the Sherman Act.” (Italics added.)

There is, to be sure, an exception to the rule. It will exist when the defendants have in some manner barred their “competitors from meaningful access to adjudicatory tribunals and so to usurp that decisionmaking process,” or otherwise consisted of a “combination of entrepreneurs to harass and deter their competitors from having ‘free and unlimited access’ to the agencies and courts,...” (California Transport v. Trucking Unlimited, supra, 404 U.S. 508 , 512, 515 [ 30 L.Ed.2d 642 , 647, 649].)

In the case at bench we discern neither allegations, nor proof, nor offer of proof, that defendants or any of them had directly, or indirectly, intended or attempted or conspired to bar plaintiffs from “‘free and unlimited access’ to the agencies and courts,...” Their protests against the transfer of plaintiffs’ license, even though motivated by selfish commercial or competitive reasons, were constitutionally protected in relation to the Cartwright Act, also.

The order granting summary judgment as to the instant count was properly entered.

No abuse of discretion is seen in the superior court’s sustaining of defendants’ demurrer without leave to amend. Plaintiffs made no showing or argument in the superior court and make none here how, or in what manner, the complaint’s subject counts could have been successfully amended to state causes of action. Nor does the record reasonably indicate that such could be done. (See Routh v. Quinn (1942) 20 Cal.2d 488 , 493-494 [ 127 P.2d 1 , 149 A.L.R. 215 ]; First Western Bank & Trust Co. v. Bookasta (1968) 267 Cal.App.2d 910 , 913 [ 73 Cal.Rptr. 657 ].)

It is regrettable that the proceedings at hand, as with such proceedings and lawsuits generally, were timetaking and undoubtedly costly to all parties. But such considerations are inherent in our form of government with its constitutional rights and protections, a form which few would wish to change.

The judgment is affirmed.

Racanelli, P. J., and Grodin, J., concurred.