I have frequently written here on the pros and cons of the Communications Decency Act (“CDA”). Without it, no website could permit comments, but by the same token it allows unscrupulous website operators to encourage defamatory postings, and then use those postings to extort payments from the victims.
Because of the latter reality, many have suggested to me that they would like to see the CDA abolished. But a case out of Australia demonstrates just how ridiculous things get without the CDA.
Those Australians are people of few words, so I had to read a number of news accounts to piece together what had occurred. A blogger by the name of Marieke Hardy apparently picked up an anonymous on-line bully. For undisclosed reasons, Hardy decided that she had determined the identity of her mystery bully, so she posted the following comment on Twitter:
“I name and shame my ‘anonymous’ internet bully. Liberating business! Join me.”
The “tweet” then provided a link back to her blog, and there on the blog she identified Joshua Meggitt as the bully. Problem was, Meggitt was not the bully.
Meggitt sued for defamation. Hardy settled with him, allegedly for around $15,000. But Meggitt wants more. Meggitt is suing Twitter for defamation for the tweet by Hardy.
Do you see how absurd things quickly become without the CDA? If Twitter is responsible for every comment, then to avoid defamation it would have to put a delay on all comments, and hire thousands of employees to review the comments. As each comment passed in front of the reviewer, he or she would need to make a quick decision about whether that comment could possible be defamatory, and only then clear it for publication.
I want you to imagine that scenario. You are one of the Twitter reviewers. Thankfully Twitter limits each tweet to 140 characters, so there is not much to review, but you must apply your best judgment to each comment to see if anyone could be offended. So up pops the following:
“That J-Lo. She be crazy.”
Do you hit the approve or disapprove button? Was the “crazy” comment meant in a good or bad sense? Even if the person making the comment meant only that the singer Jennifer Lopez is crazy good, if you approve the comment then every person in the world who goes by the name J-Lo could potentially sue for defamation, claiming that the post accuses them of having mental problems.
But the dispute between Hardy and Meggitt takes the scenario to an even more absurd level. Applying those facts to out hypothetical, what you really received was:
“That J-Lo. She be crazy. http://tinyurl.com/48y28m7″
What do you do with THAT?! Twitter requires you to review and approve or deny 120 tweets per hour. To keep your job you only have less than 30 seconds to make a decision. You quickly click on the link to see why J-Lo is crazy, and you are confronted with a four and a half minute video! Do you have to watch the entire video to make sure it contains nothing defamatory? You don’t have time for that. REJECTED!
And here, all the tweeter wanted to do was pass along a great video by J-Lo.
Under the best possible circumstances, Twitter would be relegated to approving only the most milk toast comments with no possible defamatory implication. In reality though, Twitter could not possibly exist if it could be held liable for every comment posted.
To all of you who just responded with a resounding, “Who cares about Twitter?”, that’s not really the point. I’m talking big picture here.
It will be very interesting to see how the courts in Australia handle this case.
An international defamation action has ended up here in California. Out of the UK, Tyneside councillors (that’s the way they spell it over there) are very upset that an anonymous blogger who calls himself “Mr. Monkey” has been defaming them.
The council has backed a three-year hunt to discover the identity of Mr. Monkey, with the legal fees now exceeding six figures. So far, since they did not retain Morris & Stone, the attempts to uncover the identity of Mr. Monkey have been unsuccessful.
Enter Coun Ahmed Khan, a councillor from a rival political party. The four plaintiff councillors successfully moved to have Khan’s personal computer records disclosed, because they apparently suspected him of being Mr. Monkey. Khan denies that he is the primate in question, but has cried “enough is enough”, and wants to put an end to the search.
To that end, he brought what I can only characterize as an offensive anti-SLAPP motion (not offensive as in crude, but as in the opposite of defensive). He intervened in the San Mateo Superior Court action and filed an anti-SLAPP motion, asserting that even though he is not Mr. Monkey, the comments of Mr. Monkey are protected and the action should therefore be dismissed.
Motion DENIED. Indeed, the court found the motion to be so frivolous that it awarded attorney fees of £40,000 to the plaintiffs. (I once obtained a judgment in Los Angeles Superior Court in British pounds. It’s worth it just to see the court clerks try to figure out how to enter it into the system and calculate interest and the like.)
Khan has now appealed the denial of his anti-SLAPP motion and the award of attorney fees. The complete story can be found here.
[Correction] The sources upon which I was relying may have jumped the gun as to the award of attorney fees. One of the parties to the action contacted me to state that the £40,000 figure is what is being sought, but that the motion for those fees has been stayed pending the appeal.
The case of Metabolic Research, Inc. v. Scott J. Ferrell, et al. is turning out to be a fascinating case on several levels, including liability considerations for attorneys and SLAPP issues. Briefly, here are the facts as set forth in a recent opinion of the Ninth Circuit Court of Appeals.
Scott J. Ferrell is an attorney practicing in Orange County, California. He apparently believes that a supplement being made by Metabolic and sold by GNC (Stemulite) is bad stuff. To that end, he sent demand letters to Metabolic and GNC in Pennsylvania and Nevada, accusing them of violating the California Consumer Legal Remedies Act by way of false advertising, and threatening to sue them (presumably in California)* if they did not stop their (allegedly) evil ways and agree to an injunction to that effect.
In California, Ferrell’s letter would likely have been determined to be part of the litigation process and therefore protected, UNLESS it was deemed to be extortion. (See Flately v. Mauro.) In California, the issue would have proved very interesting, because while Ferrell was not demanding any money, the hallmark of true extortion, the injunction he was demanding was so onerous – including a requirement that all profits be disgorged – that Metabolic claimed it would have put it out of business. Nonetheless, in California it might have been decided that the letters did not cross the line, and Ferrell would have been safe from suit.
But Ferrell’s letters were sent outside of California. In November 2009 Metabolic filed a lawsuit in Nevada State Court against Ferrell, charging extortion and racketeering based on his demand letter. Ferrell removed the case to Federal Court (I never would have done that for the reasons that follow), and then brought a motion to dismiss based upon Nevada’s anti-SLAPP statute, claiming that the lawsuit amounted to a SLAPP because it was suing him for engaging in litigation.
Motion DENIED. The District Court found that “Nevada’s anti-SLAPP legislation only protected communications made directly to a governmental agency and did not protect a demand letter sent to a potential defendant in litigation.” Again, as would be appropriate in California but not necessarily elsewhere, Ferrell took an immediate appeal.
Appeal DENIED. Federal courts do not like interlocutory appeals, and will find a way to reject them. The court did an in-depth review of Nevada’s anti-SLAPP statute, and concluded there was no right of immediate review of a denial of an anti-SLAPP motion. The court referred to this as a “run of the mill anti-SLAPP motion” (ouch), and held that a District Court judge affords sufficient safeguards to protect defendants from SLAPP actions without the added protection of an immediate appeal. However, to twist the knife a little, the Ninth Circuit threw in that Ferrell could have proceeded by way of a writ of mandamus, and that it was offering “no opinion on how we might have decided” such an application had it been pursued.
Lawyer Lesson 1: Consider that when you send a demand letter out of state, you may be subjecting yourself to an action in that jurisdiction.
Lawyer Lesson 2: (And I have seen this over and over) Don’t remove a case to Federal court just because you can. The motion may well have been decided the same way in State court, but I would not have wanted it decided there.
* That’s not me presuming, the court opinion used those words.
If you or your business is the victim of Internet defamation by an anonymous poster, and you decide to go after that person, you have many hoops to jump through to get the necessary information. Say you are being trashed on WeTrashPeople.com by an unknown person. (I just made up that name, but I’m sure someone will snatch up the URL.) Unless the site is one of the few that displays the IP address of the poster, you may have to go through three rounds of subpoenas to work your way back to the Internet Service Provider (ISP), such as Cox, Time Warner, or whomever. Complicating things, most ISPs use dynamic IP addresses. In other words, every IP address is used by different subscribers at different times. It is not enough just to know the IP address of the person who posted the lies about you, you must find out who that address was assigned to at the precise time and date the comment was posted.
And that is why you must move quickly. The ISPs all have their own policies on how long they retain that information. If you wait six months to retain counsel to go after the person who is defaming you, by the time the attorney works through the subpoena process, the essential information may be gone.
It appeared that was going to be the case with our client, who waited too long before contacting us. We traced the information all the way back to the ISP, who responded to our subpoena by stating that the information was not retained. With some additional pressing by us, the ISP revised its position and coughed up the information, but that could have been the end of the road for the client’s action.
Bottom line: If you are the victim of defamation, and you think you want to pursue an action, move quickly. Filing an action does not mean you are committing yourself to going to court. More often than not, once we have identified the defamer, an informal resolution can be reached. On multiple occasions we have discovered that the defamer is a competing business who is posting false reviews. They are more than willing to remove the comments once they have been exposed to the light.
I found this news squib interesting because it follows the precise example I often use to explain the difference between opinion and a statement of fact, and it shows how one country is dealing with reviews posted for extortionist purposes.
First, the example. If you eat at a restaurant and later post a review that says the food tasted like poison, you are probably safe from a claim for defamation. Most would agree that your statement is mere hyperbole; that you are offering your opinion that the food tasted bad, not that you actually meant it contained poison.
On the other hand, if you say that the food did, indeed, poison you, then you’d better be able to back it up with hard evidence. The first cannot be measured – what you think poison tastes like is your opinion. The second statement can be tested, because we can see if the food that day could have led to food poisoning.
Now to the real life application. It seems that one of the latest fads in Internet extortion is for a reviewer to post a review claiming that he suffered food poisoning at a restaurant. The extortionist then offers to accept, say, $5,000 for the pain and suffering of the poisoning and, oh, incidentally, offers to take down the terrible review as well. Other times the offer to remove the post never comes, because the false allegation of food poisoning is from a competitor.
This scam has become so rampant in Great Britain that the Advertising Standards Authority (ASA) has informed TripAdvisor that it can no longer claim or even imply that its restaurant reviews can be trusted. The news item added that it is not always the case that the reviewer knows he or she is publishing a falsehood. When one suffers legitimate food poisoning, they almost always blame the last place they ate, not realizing that the incubation period for a good case of food poisoning is usually one or two days, and can take as long as a week. In most cases, it is impossible to know which restaurant is responsible for the poisoning except by finding a common restaurant among a group of victims.
The report of this defamation caught my eye because of the parties involved. There is a standard joke among attorneys, that if you find yourself suing widows, orphans or nuns, your practice has probably taken a bad turn. In this case, nuns were being sued for defamation.
It started when the nuns decided to sell an old painting they had laying around. The painting was in really bad shape, not even worth hanging, but it turned out to be by a well regarded artist, William-Adolphe Bouguereau. So the nuns had it appraised by an art dealer named Mark LaSalle. Based on his appraisal, the nuns agreed to sell the painting to Mark Zaplin for $450,000. Zaplin had the painting restored to its former glory, a fact that I think is crucial to this case, and turned around and sold it for $2.15 million, netting a tidy little profit.
The nuns sued LaSalle and Zaplin under a number of theories, claiming that Zaplin had been a straw buyer, and that LaSalle was working in concert with Zaplin and had conned the Daughters of Mary by intentionally under-appraising the painting in order to buy it at a bargain price. The two Marks counter-sued for defamation, because the nuns had made these same claims to the media. (In case you’re new here, you can never sue for defamation for things said in conjunction with a lawsuit, since those statements are privileged, but you can sue if the same statements are made to the media.)
Here is the part I find interesting and the main reason for this article. The nuns had a witness. An art dealer by the name of Paul Dumont claimed to know both LaSalle and Zaplin, and testified that LaSalle had told him that they could “make a handsome profit by giving the sisters a low appraisal value of between $350,000 and $450,000 and presenting a buyer who would pay the amount of our deliberate and intentionally inaccurate appraisal.” He claimed that LaSalle had asked him to find a “money man” who would act as a straw buyer.
Wow. Pretty strong stuff. So the nuns must have won, right? Actually, they went down in flames (can I say that about nuns?). A New York jury found against them on all of their claims, and instead awarded LaSalle $250,000 for defamation against Dumont and a church Bishop, and awarded Zaplin $75,000 against Dumont for defamation. LaSalle will also recover punitive damages.
But how can that happen with a witness who is specifically corroborating the story of the fraudulent appraisal and straw buyer? And therein lies the moral of this story. Continue reading
One of our latest anti-SLAPP victories provides a beautiful illustration of a “stealth” SLAPP suit that the plaintiff’s attorney failed to recognize, to the great expense of his client.
In this case our (future) client’s business partner, we’ll call him Freddy Fraudster, opened a credit card account at a local bank using our client’s personal information. When our client discovered what Freddy had done, he contacted the bank and informed the personnel there that Freddy had committed fraud, and based on this report the bank closed the account and reported the matter to the police. Our client also filed a police report, and filed for a restraining order against Freddy.
Freddy was not happy. He had a long term relationship with the bank, and based on the report by our client, the bank closed his accounts and would have nothing further to do with him. Apparently thinking the best defense is a good offense, and hoping that winning the race to the courthouse might give him some leverage, Freddy filed an action against our client. He claimed that our client had authorized him to open the account, and that the report to the bank was therefore defamatory since it accused him of fraud.
Do you see why Freddy’s action in Superior Court was a SLAPP suit? Opposing counsel didn’t, but we recognized that this was a SLAPP suit and successfully brought an anti-SLAPP motion. You see, a SLAPP suit is one that tries to block a person’s right of petition. Freddy’s attorney realized that the report to the police and the application for the restraining order were protected rights of petition, but he mistakenly thought that the report to the bank, requesting that the credit card be cancelled, was not a petition for redress and therefore did not fall under the SLAPP statute because it did not involve any government agency. No doubt, he thought that by suing our client for defamation, he could make all his evil deeds go away and get back in good stead with the bank by offering to dismiss the case if our client would withdraw his remarks to the bank, court and police. Now it sounds like a SLAPP, doesn’t it?
The interpretation of the SLAPP statutes by Freddy’s attorney was far too narrow. Consider. One day you run a credit report on yourself and you find that someone has fraudulently opened a credit card in your name. What is the first thing you are going to do? Call an official government agency? You might do that eventually, but first you are going to call the credit card company and tell them to cancel the card. Thus, contacting the credit card company, or in our case the bank, is a natural part of the entire “right of petition.”
It’s very similar to the litigation privilege. I occasionally see cases where a defendant tries to sue the plaintiff and his attorney, claiming that the demand letter sent by the attorney was defamatory because it falsely claimed the defendant did something illegal. But under Civil Code section 47, anything said in conjunction with litigation is privileged and therefore not defamatory. The demand letter from the attorney takes place before legal action is ever filed, but it is still part of the litigation process.
So it was here. The report to the bank occurred before any “right of petition” was pursued with a government agency, but calling to cancel the credit card was a natural part of that process. If a plaintiff were permitted to SLAPP a defendant by focusing on the activities leading up to the actual right of petition, then the intent of the anti-SLAPP statutes would be subverted. We explained that to the court, and our motion was granted.
In February of last year I wrote about the case of Paul Anka versus Anna Anka. Paul was suing his estranged wife Anna for defamation, claiming that Anna had defamed him by stating that she had never signed a prenuptual agreement, and that any agreement he could produce would be forged. I happened to think of that article today, and wondered what had occurred in the litigation. A Google search revealed no updates on the matter, so I went to the court’s website to look at the docket.
As it turns out, the case was dismissed in July 2010. Since it was filed in February, the action lasted less than seven months. But during those seven months, 87 entries were made onto the docket. As I went through the entries, I could see that nothing ever really happened on the case, except for fights over service, discovery, amendments to the pleadings, etc. In other words, nothing substantive ever occurred, and ultimately Paul’s complaint and Anna’s cross-complaint were both dismissed with prejudice.
Normally, if a plaintiff loses his desire to continue with a case and dismisses it, the case is dismissed WITHOUT prejudice, meaning that if the plaintiff changes his mind, he can file the case again (assuming the statute of limitations has not passed). When a case is dismissed WITH prejudice, that means it cannot be refiled, and is almost always an indication that the parties entered into a settlement agreement that required the action to be dismissed with prejudice. I surmise that the parties agreed to dismiss their actions against one another as part of a divorce settlement.
I am often asked by potential clients what it will cost to prosecute a defamation action. In response, I always apologize for having to sound like an attorney, but the answer is, “it depends on what the other side does.” If the other side does nothing but appear in the action, then we can decide how much time we want to devote on the case. Theoretically, you could file an action, conduct no discovery, and show up on the first day of trial to present your case. But it seldom works that way. As the Anka case demonstrates, a great deal of time and energy was expended on this case, just trying to get it past the pleading stage, because everything turned into a fight.
I sometimes hear the question, “how can the other side get away with this?” The answer is, I don’t let the other side get away with anything, but ultimately it is the court that must make them behave. For example, in the Anka docket (see link below), there was a fight over taking a deposition. The way a deposition is supposed to work is the plaintiff sends out a notice of the time and place, and the defendant shows up at that time and place. But what if the defendant fails to appear, or appears and fails to properly answer the questions? Only the court can force the defendant to behave, so the plaintiff must bring the wrongdoing to the court’s attention by bringing a motion to compel the defendant to appear and answer the questions.
Thirty days later, the motion is heard, and the court orders the defendant to appear, awarding sanctions to plaintiff which seldom equal the actual cost of bringing the motion. The deposition is set ten days later, and this time the defendant appears, but refuses to allow the deposition to be videotaped even though the notice stated that the depo would be taped. So it’s back to court for an order compelling the defendant to go forward with the video taped deposition. And so it goes.
Some judges finally get fed up, and will order that a discovery referee sit in on the deposition and make any necessary orders, but that is very expensive. Alternatively, the judge will eventually strike the answer of the defendant and enter her default, but since that is such an extreme result, judges will usually require repeated violations of the court’s orders before proceeding in that manner.
A story in this month’s California Lawyer magazine caught my eye as an excellent case study on a point I try to explain to clients, sometimes unsuccessfully, about defamation actions.
Travel with me back to 1847 to the ill-fated Donner Party. While crossing the Sierra Nevada Mountains near present day Truckee, the wagon train could go no further and the travelers had to hunker down and try to wait out the extreme winter weather. Of the original 89 pioneers, only 45 were rescued, and it was soon learned that they had survived by eating the others.
One of the survivors was a German immigrant name Lewis Keseberg. Keseberg admitted to cannibalism, but the authorities became convinced that Keseberg had not always waited for someone to die from exposure before using them as a food source, and he was put on trial for six murders. Although he was acquitted for lack of evidence, one of the rescuers told gruesome stories about Keseberg’s cannibalistic ways, and those stories were printed in the newspaper.
Keseberg sued for defamation, which was an amazing feat in and of itself because California was not yet a state, so such a suit must have been a procedural nightmare. He sought $1,000 in damages.
In what may have been the first defamation action on state soil, Keseberg won his lawsuit, but the court awarded only $1, and ordered Keseberg to pay the court costs.
And therein lies the lesson that some potential clients refuse to accept. Winning a defamation action is more than just proving each of the elements of libel or slander. Context is everything. The damages in a defamation action arise from the loss of reputation. A person can have a reputation that is so bad, that defamatory statements simply don’t make it any worse.
In Keseberg v. Coffeemeyer, Keseberg had been falsely accused of stealing from the people he ate. He was very offended by that accusation, and headlines in the paper that read, “Where Did Keseberg Hide the Donner Treasure?” But here’s the thing, Keseberg, YOU ATE DEAD PEOPLE! You are already off most dinner invitation lists. The added claim that you took the money of the DEAD PEOPLE YOU ATE is not a big blow to your reputation.
I’m reminded of the line from Star Wars.
Princess Leia shouts at Han Solo, “Why, you stuck up, half-witted, scruffy-looking, nerf-herder.”
To which Han Solo responds, “Who’s scruffy-looking?”
You will not succeed in a defamation action if, out of five terrible things said about you, only one is false.