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Kahane v. Jansen

California Court of Appeal
2008 WL 5077628 (2008)


Facts

Attorney Dennis Kahane (plaintiff) prevailed in a lawsuit brought against him by Lynn Jansen (defendant). The basis of the lawsuit was that Kahane, acting as attorney for Alamo Orchards LLC (Alamo), owed a fiduciary duty to Jansen, who believed himself to be member-manager of Alamo. Kahane then brought a lawsuit against Jansen for malicious prosecution and sought compensation for reputational harm caused by Jansen’s unsuccessful lawsuit. The basis of the malicious-prosecution claim was that Jansen did not have probable cause to believe Kahane owed Jansen, as manager of Alamo, a fiduciary duty to disclose potential conflicts of interest. Kahane did have a potential conflict of interest as the attorney of one of the members of Alamo, Brent Tucker, whose company did business with Alamo. However, Jansen had received written consent from Alamo’s members holding a majority of Alamo’s membership interests, designating him as a managing member of the limited-liability company (LLC) in a borrowing-authorization document. This method of selecting a manager was specifically authorized by Alamo’s operating agreement. The borrowing authorization granted Jansen broad authority to act on behalf of Alamo. Jansen filed a special motion to strike Kahane’s claim, which the lower court granted. Kahane appealed to the California Court of Appeal.

Rule of Law

Issue

Holding and Reasoning (Rivera, J.)

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