A recent court decision has reversed a previous ruling in a high-stakes legal battle over waste collection services in Los Angeles. WasteXperts, Inc. filed the complaint against Arakelian Enterprises, Inc., doing business as Athens Services, on June 2022, alleging multiple tort claims and seeking judicial declarations. The case was initially struck down by the Superior Court of Los Angeles County but has now been revived by the Court of Appeal of the State of California.
WasteXperts' lawsuit centers around a dispute involving waste collection services provided under a franchise agreement between Athens and the City of Los Angeles. According to WasteXperts, Athens holds an exclusive franchise that allows it to impose additional charges for moving waste bins from property owners' premises to the curbside for collection. WasteXperts offers a service that includes moving these bins for property owners, which led Athens to send a cease-and-desist letter accusing WasteXperts of illegal conduct and threatening litigation.
The complaint by WasteXperts sought seven judicial declarations clarifying their right to provide on-site waste management services without interference from Athens or the City. Additionally, they alleged that Athens engaged in unfair competition, trade libel, and interference with contractual relations by sending letters directly to WasteXperts' clients demanding they stop using WasteXperts' services.
Athens responded with an anti-SLAPP motion aimed at striking down the entire complaint, arguing that their communications were protected as prelitigation activities under California's anti-SLAPP statute (Code Civ. Proc., § 425.16). The trial court initially agreed with Athens, ruling that their actions were protected and dismissing WasteXperts' claims.
However, upon appeal, the Court of Appeal reversed this decision. The appellate court concluded that WasteXperts’ declaratory relief claim did not arise from protected activity because it was based on an existing dispute over waste management rights rather than solely on Athens’s prelitigation communications. Furthermore, even though some of Athens's communications could be considered protected prelitigation activity, they fell within the commercial speech exemption (Code Civ. Proc., § 425.17) because they were directed at potential customers and concerned business operations.
WasteXperts is seeking judicial declarations affirming their right to offer on-site waste management services without needing a franchise agreement or facing penalties from Athens or the City. They also seek damages for economic losses caused by Athens’s alleged unfair competition and interference with business relations.
The attorneys involved in this case include Christopher Frost, John D. Maatta, and Nicholas Lauber representing WasteXperts; Ronald B. Turovsky, Donald R. Brown, and Benjamin G. Shatz from Manatt, Phelps & Phillips representing Athens Services; Judge Monica Bachner presided over the initial trial court decision; Appellate Judges Zukin, Currey (Presiding), and Mori concurred in reversing the lower court's ruling; Case ID: B325299.