Trident E&P, LLC v. HP, Inc.

Background

Trident contracted with the federal government to supply printers, copiers, and related support for use on U.S. Navy ships. Trident subcontracted with HP to provide the equipment. The government solicitation required the production devices to come from a single manufacturer and to be in current production.

HP proposed supplying Canon-manufactured devices that would be modified, branded, and warranted as HP products. Trident included those devices in its proposal. After protests by Xerox, the Government Accountability Office denied the protests, and the agency awarded the contract to Trident.

While another protest was pending before the Court of Federal Claims, HP sent Trident a December 30, 2021 letter stating that the two devices were produced and branded by Canon, not HP. HP also sent the letter to the agency. The agency then questioned whether Trident’s proposal met the solicitation’s requirements and terminated Trident’s contract on January 26, 2022.

Claims and Motions

Trident sued HP for tortious interference with contract, tortious interference with prospective economic advantage, fraud, fraudulent inducement, and defamation. HP moved to strike under California’s anti-SLAPP statute, which can protect speech connected to government proceedings. HP also moved to dismiss under Federal Rule of Civil Procedure 12(b)(6) for failure to state a legally sufficient claim.

Anti-SLAPP Ruling

The court held that California law applied under the supply agreement’s choice-of-law provision. It also held that the provision applied to HPI Federal, the HP entity that sent the letters, because HPI Federal at least benefited from the agreement. The court concluded that the December 2021 letter concerned matters under review by government entities and therefore fell within the anti-SLAPP statute.

The court rejected Trident’s argument that the letter was exempt as commercial speech. It found that the letter was not advertising or an attempt to promote HP products; instead, it responded to a compliance inquiry in the context of agency and protest proceedings.

Under the second step of the anti-SLAPP analysis, Trident had to show a probability of prevailing. The court held that Trident could not do so because the December 2021 letter was protected by California’s litigation privilege. That privilege generally bars tort liability for communications related to official or legal proceedings, and the court found that the letter was related to agency proceedings, the Government Accountability Office review, and the Court of Federal Claims lawsuit.

Failure-to-State-a-Claim Ruling

The court also held that Trident had not plausibly pleaded its claims. It treated HP’s December 2021 letter as the only act underlying all five claims. The court found that the complaint’s non-conclusory allegations established that the letter was truthful and that Trident did not adequately allege a false statement.

For tortious interference with contract, the court held that truthful information given to a third party is not an actionable intentional act designed to cause a contractual breach or disruption. The court also held that the prospective-economic-advantage claim failed because Trident did not allege the required independently wrongful act—conduct unlawful for a reason apart from the alleged interference.

The fraud and fraudulent-inducement claims failed because Trident did not plead fraud with the required specificity and, on the allegations in the complaint, HP’s assurances about the devices were truthful. The defamation claim failed because Trident did not plead a false statement, and the letter was privileged.

Disposition

The court granted HP’s motion to strike under the anti-SLAPP statute and granted HP’s motion to dismiss under Rule 12(b)(6). The order dismisses the case on both grounds. The court deferred the attorney-fee and cost issue and allowed Trident to submit an amended complaint within three weeks, accompanied by a comparison showing the changes from the current complaint.