Simplified Labor Staffing Solutions, Inc. and Simplified Staffing Labor Solutions, LLC are sister entities that provide staffing services, that is, secure payroll services, insurance coverage, licenses, and corporate benefits.
Ashish Wahi owns Simplified. Michael Dougan is its chief financial officer. A major expense in their business operation is paying for workers’ compensation insurance.
Simplified initiated litigation against Trinity Risk Management, LLC, affiliated entities Knight Management Group, Inc. and H.J. Knight International Insurance Agency, Inc., and other named defendants. Simplified alleged fraud-based claims related to workers’ compensation insurance it had purchased from defendants who sell workers’ compensation insurance to staffing companies.
Simplified filed a first amended complaint against defendants, and added Captive Resources, Inc. as another named defendant.
Simplified alleged defendants conspired to induce Simplified to purchase their worker’s compensation insurance through them by claiming that after one year of paying surcharges on the actual premiums for the coverage they required, Simplified would then earn “steep discounts on worker’s compensation coverage.” Defendants “purported to offer underwriting of insurance risk without being a licensed insurance company, and/or offered for sale insurance coverage as a broker without being a licensed broker . . . or by means of misrepresenting the actual party they represented.
The defendants filed a cross-complaint against Simplified, alleging eight causes of action, including defamation. The cross-complainants alleged Simplified and/or Wahi were approximately $2 million dollars in arrears on Simplified’s workers’ compensation payments.
Simplified filed a special motion to strike the defamation cause of action from the cross-complaint as a strategic lawsuit against public participation under the anti-SLAPP statute. The trial court granted Simplified’s special motion to strike and the court of appeal affirmed in the unpublished case of Trinity Risk etc. v. Simplified Labor.
The purpose of the anti-SLAPP law is not to insulate defendants from any liability for claims arising from the protected rights of petition or speech. It only provides a procedure for weeding out, at an early stage, meritless claims arising from protected activity.
The wording of the statute protects the right of litigants to the utmost freedom of access to the courts without fear of being harassed subsequently by derivative tort actions. The law provides that it “shall be construed broadly.”