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									Filed 9/ 30/ 10 Vanetik v. Nguyen CA4/3


California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for
publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication
or ordered published for purposes of rule 8.1115.


                                     FOURTH APPELLATE DISTRICT

                                                 DIVISION THREE


    Plaintiff and Appellant,                                           G042278

         v.                                                            (Super. Ct. No. 30-2009-00117093)

TUAN ANTHONY NGUYEN et al.,                                            OP IN IO N

     Defendants and Respondents.

                   Appeal from an order of the Superior Court of Orange County, Andrew P.
Banks, Judge. Affirmed.
                   Law Office of Rick Augustini and Rick Augustini for Plaintiff and
                   Mark S. Rosen and Dina L. Nguyen for Defendants and Respondents.

                                             *               *              *
              Plaintiff Yuri Vanetik appeals from an order granting the defendants‟
special motion to strike his complaint pursuant to the anti-SLAPP (strategic litigation
against public participation) statute, Code of Civil Procedure section 425.16. 1 He also
appeals from the denial of his request for discovery in connection with the anti-SLAPP
motion. We find no error and affirm.
                        F ACT UAL AND P ROCEDURAL B ACKGROUND
A.     The Nguyen Lawsuit
              In January 2006, attorney and certified public accountant Tony Nguyen
(Nguyen) bought 80,000 shares of stock in Turan Petroleum, Inc., ( Turan) from an entity
called, Inc., (Valueluck) for the sum of $200,000. According to a lawsuit
Nguyen filed in Orange County Superior Court (the Nguyen lawsuit), he was lured into
the purchase by two con artists in the Vietnamese community: Mitch Ngo (Ngo) and
Hiep Trinh (Trinh). Nguyen alleges Ngo and Trinh are key players, along with a Russian
father-son duo, Tony Vanetik (Tony V.) and his son Yuri Vanetik (Yuri), in a
sophisticated scam that enticed Nguyen and other investors to buy Tur an stock in illegal,
unregulated transactions employing shell companies like Valueluck.
              Before filing his lawsuit, Nguyen first tried to get Ngo and Trinh to make
good on their sales promise to repurchase the Turan stock “if [he] ever wanted to
liquidate his investment.” When they resisted, Nguyen purportedly threatened to go to
the Vietnamese media to expose their wrongdoing. Failing to force a repurchase, Nguyen
filed his complaint on October 21, 2008, against Ngo, Trinh, Tony V., Yuri, Valueluck,
Turan, and two other individuals, stating a laundry list of claims including fraud,
securities violations, and breach of contract.

       1      All further statutory references are to the Code of Civil Procedure unless
otherwise indicated.

B.     The Turan Lawsuit
              Within days, Turan filed its own lawsuit (the Turan lawsuit) in federal
district court against Ngo, Trinh, Tony V., Yuri, Valueluck, and several other individuals
and entities.2 Like the Nguyen lawsuit, the Turan lawsuit stated claims for fraud,
securities violations, and civil conspiracy, among other claims. The latter complaint, at
60 pages in length, pro vided a highly detailed explanation of how the fraudulent
securities scheme worked.
              According to the Turan lawsuit, the two Russians were the ring leaders of a
very sophisticated conspiracy. Essentially, Tony V. and Yuri cofounded Turan in April
2001 and, together with Trinh, they (the trio) controlled Turan until the new board of
directors –– which filed the Turan lawsuit –– took over in May 2008. The complaint
alleged Turan was a “shell” company until 2004, when it entered the oil and gas industry
by acquiring another entity that owned a license to explore and extract hydrocarbons in a
huge oil reserve in the Republic of Kazakhstan. With that acquisition, the trio made
plans to engage in a wide-ranging fraudulent scheme that involved creating a “grey
market” for Turan stock. In a nutshell, the trio acquired large blocks of Turan stock
through sham transactions and they later sold “millions of Turan shares to multiple
members of the public in an unregistered secondary distribution,” thereby enriching
themselves and starving Turan of needed cash.
              The fraudulent scheme consisted of two steps. First, the trio arranged for
the fraudulent issuance of large amounts of Turan stock to “phantom founders,” who did
not found the corporation, and thus neither earned nor paid for the stock. The trio used
various shell corporations, including Valueluck (controlled by Yuri and Tony V.) to
“park” the shares with these “phantom founders” until the trio decided to cash in. When

       2       According to Yuri, this lawsuit was in retaliation for Tony V.‟s earlier
filing of a lawsuit against “the current management of Turan,” in Nevada state court in
August 2008. That is the “third” pending lawsuit referred to in the briefs.

the time was right, the trio launched step two of the fraud: They used the shell
corporations to retrieve the “parked” stock from the “phantom founders” (by forgery and
other illegal means), and then used a fictitious “last trading price” to set an inflated sales
price for an unregistered “secondary distribution” of millions of Turan shares to the
public. (A secondary distribution is made on behalf of the individual shareholders, not
for the benefit of the corporation.) This secondary distribution, via Valueluck, violated
securities law and victimized Nguyen, and is the backdrop to his lawsuit.
              This illicit “secondary distribution” of stock held by the trio (and other
defendants) competed with a lawful private placement by the corporation itself. The
secondary distribution raised $10 million to $15 million for the trio; the private
placement raised only $2.6 million for Turan. Of the $2.6 million Turan raised from the
private placement, Tony V., as chief executive officer of Turan, diverted about $1.4
million to pay the “business expenses” of NRG Resources, Inc., (NRG) a corporation
“controlled and owned” by Tony V. and Trinh. The Turan complaint goes on to allege
various shenanigans by NRG at the expense of Turan, including using funds diverted
from Turan to buy a subsidiary with a license to drill for oil in the same Kazakhstan oil
field as Turan, making NRG a direct competitor to Turan.

[Back to the Nguyen Lawsuit Briefly]
              Significantly, the Nguyen lawsuit alleges NRG played a small but
important role in defendants‟ scam. Nguyen alleged Ngo and Trinh ensnared him in the
Turan investment scheme by first enticing him to invest in NRG. They promised
spectacular returns from NRG and a buyback if he wanted out. Only after Nguyen
invested $20,000 in NRG, did Ngo and Trinh invite him to invest in Turan, representing
it had “huge oil reserves in Kazakhstan,” “a limited number of shareholders . . . less than
25,” the opportunity to invest with a “minimum investment of $500,000,” and a promise

of an immediate buyback of the shares if Nguyen wanted out. According to Nguyen, all
of this proved false, except for NRG‟s license to explore for oil in Kazakhstan.

C.     The “Libelous” News Reports in the Vietnamese Press
              On November 12, 2008, about three weeks after the two lawsuits were
filed, defendants Christopher Phan, a reporter, and Viet Star Weekly (Viet Star), a
Vietnamese-language newsmagazine, published an article entitled “Vietnamese President
Nguyen Minh Triet Event Was Hosted By A Scam Company.” The article reported on
the two lawsuits and purported to warn the Vietnamese community about a “scam in the
Little Saigon.” We quote parts of this and a follow up article at length because the
quoted parts are the basis of Yuri‟s libel suit, which was dismissed as a SLAPP suit in the
order appealed here.3
              The November 12 article referred to Trinh as the “Vice President and
founder of NRG,” and “just another con artist,” and then mentioned “[t]he most recent
case filed against” Trinh, Trinh‟s wife, and Tony V., identifying the Turan lawsuit by it s
federal district court case number, and stating that interested readers could find more
information by searching its case number on Google. The article next mentioned the
Nguyen lawsuit. It stated: “Most recently, a few members of Little Saigon investors
have filed a complaint against [Tony V., Yuri, Trinh, Trinh‟s wife, Ngo, and three other
named Vietnamese individuals]. [Ngo‟s] motive was to attract the rich businessmen at
the tennis clubs in Orange County, associations, and churches to introduce po tential
investors to [Trinh and Ngo]. [¶] These con-artists are a pain and disgrace to the
Vietnamese Community and a heart ache to the parents who raised them. And if the
Vietnamese Government Officials happens to read the Viet Star Weekly articles, then

       3       The quotations are taken from an often ungrammatical English translation
of the original Vietnamese articles, attached as an exhibit to the complaint.

they will know that they were ignorant and got scammed. [ 4] . . . [¶] Viet Star Weekly
News Paper will print several more articles about this incident, hoping that the
community will be more aware of this lesson about scam in the Little Saigon.”
              On November 26, 2008, defendants Phan and Viet Star published a second
article. This article, entitled “One of the More Names in the Scamming of the President
of Vietnamese Communist Nguyen Minh Triet,” purported to provide more information
to the Vietnamese community about Trinh‟s and Ngo‟s nefarious activities, essentially
consisting of being too friendly with the Communist government of Vietnam and
working with Tony V. and Yuri through “NRG Company” to swindle Vietnamese
investors. In attempting to summarize the outstanding allegations of fraud against Trinh,
Ngo, Tony V. and Yuri, the article erroneously focused entirely on NRG as their vehicle
for “swindling” the community, ignoring Turan and Valueluck.
              The article stated: “NRG in real life is a „phantom company‟ that was
established by a two Russians (father & son) named Vanetik „Tony Vanetik and Yuri
Vanetik‟ to swindle . . . scam. To create a believable business, father and son open up a
Russian oil exploration company and assigned (HIRES) [] Trinh to recruit [] Ngo to
penetrated into the Vietnamese community and spread out the rumor intentionally Tony
Vanetik is a close friend with Russian President Putin. . . . [¶] Effectively by several
advertisements and attractive return investment, hundred Vietnamese rush in to put their
money in NRG company and not aware that they fall in a trap of scamming artist. After
collecting up to hundred of millions dollar, [] Trinh and [] Ngo never answer the phone
and try to hide. Actually, [] Trinh is a professional scam artist that was hired by father
and son Vanetik. [] Trinh is a high-level scam artist with a previous police records and
was banned from any relating financing activity by the court. . . . [¶] At this moment,

       4       The mention of Vietnamese government officials getting “scammed”
referred to President Triet‟s public appearance at an event hosted by some of the accused

„three words‟ investigator are investigate this „phantom company‟ regarding taking
money from several investors . . . . [¶] The employees for this phantom company
forgetting one thing: They can scam one single individual, he or she might not do
anything but when this number of investors is up to hundreds then perhaps some of them
among these group willing to suit them to the end. . . . [T]hey want to give these NRG‟s
employees a lesson. . . . [¶] Although NRG is a professional scam company under good
talented and creative [] Trinh‟s management but they still fall into a trap . . . . [¶] Wait
and Read the next article on Viet Star, we will give out documents of law suit happening
in NRG Company and names employee of the Corp. and their activity in our community
in working with Viet Nam Communist Party in California underground.”
              Yuri contends a number of the article‟s assertions “as they concern [Yuri]
are false.” Specifically, he asserts “NRG is a legitimate company . . . . [¶] [Yuri] did not
form NRG, let alone do so to „swindle‟ or „scam‟ investors. [¶] To the contrary, [Yuri]
has never defrauded, „swindled‟ or „scammed‟ investors in any company. Nor has [Yuri]
ever defrauded the President of Vietnam . . . .” As for the November 12 article, Yuri
challenges its report that “a few numbers of Little Saigon investors have” sued him, Tony
V., Trinh, Ngo, and others, pointing out that when the article was published, Nguyen
“was the only investor who had sued [Yuri] in connection with Turan or NRG.”

D.     The Defamation Action and the Anti-SLAPP Motion
              Yuri demanded that defendants retract the defamatory statements. When
they failed to do so, he filed the instant lawsuit for defamation on January 9, 2009. He
sued Nguyen for filing the Nguyen lawsuit and sued Phan and Viet Star for publishing
the two articles. Defendants countered with an anti-SLAPP motion under section 425.16.
Nguyen has since settled out, so the appeal concerns only the newspaper defendants‟

                In the anti-SLAPP motion, defendants asserted publication of t he two
articles was protected activity because the articles reported “the substance of the legal
complaints and charges that had been filed against” Yuri, and they were published in a
public forum on a matter of public interest. Moreover, defendants asserted publication of
the articles was absolutely privileged under Civil Code section 47. They asserted two
additional defenses: the statements in the article were true, and the statements constituted
mere opinion.
                Yuri sought an ex parte order allowing him to conduct discovery, which
was denied, and he renewed the discovery request in his opposition to the anti-SLAPP
motion. Specifically, he wanted to discover facts as to whether Viet Star qualified as a
public forum and also facts concerning reporter Phan‟s prior relationship with Nguyen.
Yuri also wanted to learn whether Phan reported Nguyen‟s allegations, knowing they
were false, to help pressure Yuri and his associates into refunding Nguyen‟s money and
also to boost the circulation of the newly launched Viet News.

E.     The Order
                The trial court granted the anti-SLAPP motion and ordered the complaint
stricken. The order stated that the face of the complaint shows “the overall gist of the
Causes of Action against Defendants Phan and Viet Star are based on the allegations of
the complaints in the underlying action or on communications of the contents of those
complaints, or a fair reporting of them, by a public journal.” Because “[s]uch allegations
are protected activity within the meaning of Section 425.16,” and because “the statements
were made in a public forum on an issue of public interest,” defendants met their initial
burden under section 425.16 and the burden then shifted to plaintiff to prove a probability
of prevailing on the merits. The court concluded plaintiff could not “meet that shifted
burden” because “those same allegations and statements are absolutely privileged under
Civil Code section 47.”

              The court also denied Yuri‟s discovery requests because the discovery
sought “will not aid him in overcoming the fact that the” allegedly defamatory
communications “are privileged.”
              This appeal followed.
              Yuri argues the trial court erred in granting the anti-SLAPP motion and in
denying his discovery request. Neither claim has merit.

A.     The Anti-SLAPP Motion
              “Section 425.16 articulates a „two-step process for determining whether an
action is a SLAPP.‟ [Citations.] „“First, the court decides whether the defendant has
made a threshold prima facie showing that the defendant‟s acts, of which the plaintiff
complains, were ones taken in furtherance of the defendant‟s constitutional rights of
petition or free speech in connection with a public issue. [Citation.] If the court finds
that such a showing has been made, then the plaintiff will be required to demonstrate that
„there is a probability that the plaintiff will prevail on the claim.‟ [Citations.] . . . „Only
a cause of action that satisfies both prongs of the anti-SLAPP statute –– i.e., that arises
from protected speech or petitioning and lacks even minimal merit –– is a SLAPP,
subject to being stricken under the statute.‟ [Citation.]” (Governor Gray Davis Com. v.
American Taxpayers Alliance (2002) 102 Cal.App.4th 449, 456.)
              Plaintiff contends the trial court erred in bot h steps of the anti-SLAPP
analysis. He argues, contrary to the trial court‟s findings, that defendants failed to
establish their defamatory publications constituted protected activity under the statute,
and that he made the requisite prima facie case for prevailing on the merits because
defendants rely on a mistaken claim of absolute privilege under Civil Code section 47.
We conclude Yuri is the mistaken one.

       1.     The First Prong of Section 425.16
              The trial court concluded the facts alleged in the complaint fall within two
of the four categories of protected activities under the anti-SLAPP statute. The first of
these two categories is set forth in section 425.16, subdivision (e)(2): statements “made
in connection with an issue under consideration or review by a legislative, executive or
judicial body, or any other official proceeding authorized by law.”
              Plaintiff argues this subdivision does not apply because none of the
defamatory statements was “clearly related” to an issue under review in one of the then-
pending litigation matters on which defendants claim to have been reporting. Essentially,
he argues that because certain facts in the defamatory statements differed from
allegations in the Nguyen and Turan complaints, the defamatory statements are not
sufficiently “related” to the complaints to gain protection under this subdivision. The
argument lacks merit because, despite certain factual inaccuracies, the articles conveyed
“the gist” of the lawsuits, making their publication protected activity unde r the statute.
(See Paterno v. Superior Court (2008) 163 Cal.App.4th 1342, 1354 (Paterno).)
              In developing his argument, plaintiff cites two factual distinctions between
the articles and the Nguyen lawsuit. First, he points out that Nguyen alleged he had been
lured by Yuri and his cohorts into a ponzi-style investment in Turan, while the subject
articles described the scam as involving investments in NRG and failed to even mention
Turan. Second, he argues the Nguyen lawsuit “did not make any allegations regarding
any other investors, Vietnamese or otherwise . . .” while the articles describe “hundreds”
of investors who had been caught up in the fraudulent scheme.
              Plaintiff is right about the article‟s mistaken identification of NRG in place
of Turan, but such a naming error does not cloud or distort the nature of the scam alleged.
Moreover, plaintiff is wrong on his latter point. The Nguyen lawsuit alleged Nguyen had
“uncovered many investors who were in the same situation”; defendants had duped
“many investors” into buying defendants‟ “own shares [for their] own financial benefit”

(i.e., they duped many investors into the illicit secondary distribution rather than the
legitimate private placement); and defendants made the “same promises to many
investors without intending [to] fulfill[] them.”
                 As for the Turan lawsuit, Yuri claims it also could not be the basis of the
articles‟ defamatory assertions that he used the “phantom” NRG to “swindle” Vietnamese
investors because that lawsuit alleges only claims arising “out of the issuance of
founder‟s shares in Turan between 2001 and 2005”; it “does not contain . . . any claims
that [Yuri] formed NRG, controlled NRG or had any involvement whatsoever with
NRG”; the only wrongdoing it alleges in connection with NRG is that Tony V. “used
Turan funds to pay NRG expenses”; and, finally, the Turan complaint “does not allege
that the defendants (including [Yuri]) defrauded Turan‟s investors, but rather that the
defendants defrauded the corporation.” All of these assertions are wrong.
                 As set forth in the background section of this opinion, the Turan lawsuit
stated wide-ranging claims against Yuri and his associates for wrongful conduct up
through 2008, going far beyond the “issuance of founder‟s shares in Turan between 2001
and 2005[.]” For example, the trio‟s illicit secondary distribution of stock was a key
aspect of their alleged wrongdoing, ensnaring countless members of the public from 2006
up through 2008. The article‟s mistaken identification of Yuri as a founder and principal
of NRG simply reflects the article‟s naming error in substituting NRG for Turan. Finally,
the complaint alleged the fraud perpetrated by Turan‟s principals injured individual
investors, including Nguyen, in addition to injuring the corporation. It describes
“desperate and angry shareholders” who were “threatening lawsuits against any person or
entity connected to these manipulative trading practices by Turan‟s affiliates, including
Turan . . . .”
                 Our review of the two complaints‟ allegations reveals that the alleged
defamatory statements were indeed made “in connection with” issues under judicial

review. Consequently, the trial court properly found they were protected under
section 425.16, subdivision (e)(2).
              The second category of protected activities found applicable by the trial
court is that set forth in subdivision (e)(3) of section 425.16: statements made in a public
forum concerning a matter of public interest. Plaintiff challenged that finding on two
grounds. Neither c hallenge succeeds.
              First, Yuri contends defendants failed to establish Viet Star was a public
forum, arguing for the restrictive interpretation of public fora adopted in Lafayette
Morehouse Inc. v. Chronicle Publishing Co. (1995) 37 Cal.App.4th 855 and Weinberg v.
Feisel (2003) 110 Cal.App.4th 1122, 1130-1131. But in Paterno, supra, 163 Cal.App.4th
at p. 1351, we rejected that restrictive view and adopted a more expansive approach to
defining public fora that is more consonant with the protective purpose of the anti-
SLAPP statute. Here, defendants proffered evidence Viet Star “is a news magazine
published once a week [and] . . . distributed in general circulation for the Vietnamese
community in Orange County[.]” Like the trial court, we conclude this sho wing suffices
to establish Viet Star is a public forum.
              Second, Yuri asserts defendants failed to establish the two articles
concerned matters in the public interest. He is wrong. The articles reported on the
purported embarrassment of the Communist go vernment of Vietnam, always of interest
in Little Saigon, and also on a widespread fraud involving Vietnamese persons as both
perpetrators and victims. Moreover, the articles contained explicit warnings to the
community to avoid the reported scam. Consequently, we conclude the trial court
properly found publication of the articles was a protected activity under section 425.16,
subdivision (e)(3).

       2.      The Second Prong of Section 425.16
               Plaintiff argues he carried his burden to show he will prevail on the merits
because, contrary to the trial court‟s finding, the absolute privilege under Civil Code
section 47 is inapplicable. Plaintiff offers two arguments why the privilege does not
apply. Both arguments fail.
               First, Yuri contends defendants mistakenly asserted the wrong subdivision
of Civil Code section 47 in their anti-SLAPP motion. In the motion, they cited the
statute‟s subdivision (b), the litigation privilege, rather than the subdivision the court
relied on –– subdivision (d), which creates a privilege for “a fair and true report” of
judicial proceedings in public journals. Plaintiff asserts the defendants waived the
privilege under subdivision (d) by failing to cite it specifically in their motion.
               We find no such waiver. Although defendants did not cite subdivision (d)
of Civil Code section 47 in their motion, they did refer to its substance. The motion
argued that statutory anti-SLAPP protection “extends to journalists who cover court
proceedings or otherwise write about matters in newspapers. In this case, defendants
were reporting the substance of the legal complaints and charges that had been filed
against plaintiff. . . . Reporting complaints [is] privileged under the litigation privilege of
Civil Code section 47, just as the complaints themselves are.” This language is a clear
reference to Civil Code section 47, subdivision (d)‟s protection of “a fair and true report”
in a public journal of a judicial proceeding. Moreover, defendants did cite this specific
subdivision in their reply papers. Together, these references in the moving and reply
papers suffice to assert the statutory privilege applicable to news reports of judicial
               Second, plaintiff argues Civil Code section 47, subdivision (d), does not
apply because the subject articles are not “fair and true reports” of the two lawsuits, given
that none of the defamatory statements is contained in either complaint. We disagree. As
already explained, we find the two articles are substantially accurate in their explanation

of the fraudulent scheme alleged against Yuri and his associates by the Nguyen and
Turan lawsuits.
              For Civil Code section 47, subdivision (d), to apply, the report on pending
proceedings must be substantially true; every word need not be literally true. (Ringler
Associates Inc. v. Maryland Casualty Co. (2000) 80 Cal.App.4th 1165, 1180-1181.)
“„Under California law, a newspaper report is “fair and true” if it captures “„the
substance, the gist, the sting of the libelous charge.‟” [Citations.]‟” (Colt v. Freedom
Communications, Inc. (2003) 109 Cal.App.4th 1551, 1558.)
              Because the articles here captured the gist or sting of the allegations made
in the underlying litigation, they are privileged under Civil Code section 47, subdivision
(d). Consequently, the trial court correctly found plaintiff could not prevail on the merits
in his defamation action.

B.     The Discovery Requests
              Finally, plaintiff asserts the court erred in denying his discovery requests.
The contention lacks merit.
              Despite the automatic stay of “[a]ll discovery proceedings” triggered by the
filing of an anti-SLAPP motion, a trial court has discretion to allow the plaintiff, upon a
showing of good cause, to conduct “specified discovery.” (§ 425.16, subd. (g);
Schroeder v. Irvine City Council (2002) 97 Cal.App.4th 174, 183.) Absent an abuse of
discretion, we may not disturb the trial court‟s ruling on such a discovery request. ( Id. at
p. 191.)
              We find no abuse of discretion here. The trial court correctly determined
none of the discovery plaintiff sought could have overcome the defense of absolute
privilege under Civil Code section 47, subdivision (d). Neither Phan‟s relationship with
Nguyen nor Phan‟s motives in reporting on the two lawsuits would have defeated that
privilege. Moreover, plaintiff‟s desired inquiry into the circulation numbers for Viet Star

would not have changed the conclusion this newsmagazine is a public forum. (See
Paterno, supra, 163 Cal.App.4th at p. 1351 [adopting expansive view of public fora].)
Because plaintiff could not show the requisite good cause for his discovery requests, the
court properly denied them.
              The order is affirmed. Respondents are entitled to their costs on appeal.

                                                  ARONSON, J.





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