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Tuesday, March 03, 2020

The procedure of frivolous political defamation actions

The Donald Trump Campaign today sued the Washington Post in the District of D.C. over a June 2019 column by Greg Sargent. This follows the campaign's suit in New York state court against The New York Times. Meanwhile, Devin Nunes is up to seven lawsuits against various persons, bovines, and business entities.

This rash of lawsuits has many First Amendment advocates calling for more states and the United States to enact anti-SLAPP statutes. These suits represent the modern analogue to Southern officials' defamation campaign against northern media outlets in the 1950s and '60s. But I have been slow coming to the "anti-SLAPP is necessary" position; if the protections of New York Times were sufficient to stop the barrage 60 years ago, they should be sufficient now.

The answer comes from the latest episode of the All the Presidents Lawyers podcast. First Amendment advocate Ken (Popehat) White explains that the purpose of these lawsuits is not to win, because most of the suits are garbage under NYT and the plaintiffs and their lawyers know that. Rather, the purpose is to drag people into court and impose the time, burden, distraction, and cost of having to defend themselves, with the added benefit that it may make people and the press less willing to criticize these people. In theory, only an anti-SLAPP law--with its attorney's fees provision and expedited dismissal--addresses that problem. The alternative (in federal court) is sanctions under FRCP 11 and attorney's fees against counsel under § 1927. But courts may be reluctant to impose sanctions against a congressman, president, presidential campaign, or other powerful and famous plaintiff--especially to award attorney's fees as a sanction, which is the way to address the financial cost to the plaintiff that the lawsuit is intended to impose. Perhaps Nunes' seven nonsense lawsuits would indicate a sufficient pattern that a judge might find attorney's fees necessary for deterrence of client and attorney. But not in the mine run of cases.

Some commentators have suggested that the availability of an anti-SLAPP statute affects litigation choices. Nunes sued Twitter (a California company) and McClatchy Newspapers (publisher of the Fresno Bee) in Virginia, which lacks a strong anti-SLAPP law, rather than California, which has one. Both courts have declined to dismiss for lack of personal jurisdiction, with analysis revealing confusion over the newly narrowed scope of general jurisdiction. Some commentators have suggested that the choice of forum (federal over state court) or the choice of parties depends on whether the federal court would apply the state's anti-SLAPP law.

But we should be more nuanced on the question of anti-SLAPP laws in federal court. I have argued that the special SLAPP motion should not apply in federal court (the position of the D.C. Circuit, in which the new Trump Campaign action was field), because FRCP 12 and 56 cover the issue. (And a 12(b)(6) dismissal, in which the court considers whether the statements as pleaded are opinion, can get the defendant out of the case quickly enough). By contrast, the SLAPP attorney's fees provision should apply in federal court. Under the "relatively unguided Erie analysis," not applying the fee provision would cause a plaintiff to choose federal over state court and the attorney's fee provision is bound up with substantive state policy concerns for protecting the free speech rights of its citizens. If the real concern is the cost of having to defend even a nonsense suit, an attorney's fee provision addresses that.

Finally, it is notable that the Trump Campaign, rather than Trump, brought these two suits. I am not sure how the campaign can claim injury from statements about Trump. One commentator suggested the Campaign sued to get the WaPo case in federal court. The Campaign is a Virginia corporation with its principal place of business in New York; Trump, the commentator implies, is a D.C. domiciliary and thus not diverse from the Post.

This returns us to Where In the World Is Donald Trump? Trump was a New York domiciliary prior to January 20, 2017. In October, he (and Melania) renounced his New York citizenship and filed a Declaration of Domicile in Palm Beach County, Fla., establishing Mar-a-Lago as their permanent residence. Trump thus appears to be a Florida citizen--he has a residence there and expressed his intent to remain. Although Trump resides in D.C., he has not manifested an intent to remain there (unless he manages to get Republicans to repeal the 22d Amendment). So it is wrong to say the case could not be in federal court were Trump the named plaintiff--it would be an action between a citizen of Florida (alone or with a citizen of New York/Virginia) and wherever the Post is.

On that point, this case offers a different procedural lesson, because plaintiff counsel screwed up the jurisdictional statement with respect to the Post. Paragraph 10 reads:

On information and belief, defendant WP Company LLC d/b/a The Washington Post is a District of Columbia limited liability company with its principal place of business in Washington, D.C.

An LLC is a citizen of every state in which one its members is a citizen. So identifying an LLC as a party cannot establish jurisdiction because the LLC has no independent citizenship; you have to dig into the LLC's structure to identify individuals or corporations whose citizenship does not depend on someone else. Plaintiff did not bother doing that. I assume that some digging will lead to Jeff Bezos, who is a citizen of Washington state and/or some D.C. corporation. But the complaint, on its face, does not establish federal jurisdiction. And reflects the sort of bad (or disinterested) procedural lawyering I warn my students about. Curious if the Post will raise that or move on, knowing what jurisdictional discovery would reveal about its structure.

Posted by Howard Wasserman on March 3, 2020 at 04:35 PM in Civil Procedure, First Amendment, Howard Wasserman, Judicial Process, Law and Politics | Permalink

Comments

Well, I dunno. The average voter depends on the media for information about the several candidates on the ballot. If the media is not held responsible for knowingly publishing lies about the candidates it makes it impossible for the voter to cast a rational vote. I have gotten to the point that I cast votes only in the races for which I have reliable data. And that is damn few.

Posted by: Jim Brock, JD | Mar 13, 2020 5:27:53 PM

I guess that depends on what we want anti-SLAPP laws to do. If to deter lawsuits, perhaps you're right. Then the law serves its purpose by getting the plaintiff out quickly and giving the defendant attorney's fees. It doesn't stop the suit, but it helps make the defendant whole.

Posted by: Howard Wasserman | Mar 6, 2020 1:12:56 PM

It is an interesting question, whether anti-SLAPP laws are effective at preventing the filing of suits targeting free speech activity. It's not a question that can readily be answered--we can't know the number of suits potential plaintiffs decided not to file. But I suspect from the large number of anti-SLAPP motions granted (at least in California, where I am) that the law is not terribly effective at keeping these kind of suits out of court. That is, if so many filed suits are dismissed on anti-SLAPP grounds, it follows that the law must not be working too well to keep them from being filed in the first place.

Posted by: nemanuel | Mar 6, 2020 12:02:35 PM

Given the benefits to detering criticism for those who are willing to exchange money for good PR it seems likely that we need triple attorney’s fees so defendents likely to prevail can be compensated for trouble and have expected positive payments so third party firms will have an interest to take up cases soley for a share of fees.

Posted by: Peter Michael Gerdes | Mar 4, 2020 6:18:14 AM

As I said below, the further links in the chain (notice I didn't say bridges) from Nash are to Amazon and/or Bezos. Either way, the former is a DE corp. per its 2018 10-K and JB is presumably based in Wash. state (although you could play around the world with him too; ironically he even has an NY apartment), so diversity seems to remain intact.

https://www.sec.gov/Archives/edgar/data/1018724/000101872419000004/amzn-20181231x10k.htm
https://www.wsj.com/articles/the-many-places-amazon-ceo-jeff-bezos-calls-home-1507204462

I'll send the campaign a bill for my jurisdictional discovery services.

Posted by: hardreaders | Mar 3, 2020 8:14:36 PM

It doesn't matter where Nash is created. We have to look at Nash's members. Bezos is one, so Nash is WA. But who else is a member--if anyone from NY or VA, diversity is destroyed.

Posted by: Howard Wasserman | Mar 3, 2020 5:55:29 PM

Per web research, Nash Holdings, LLC is the owner of WP.

https://www.visualcapitalist.com/jeff-bezos-empire-chart/

To the extent relevant, Nash seems to be a Washington state LLC. The chain appears to lead from Nash to Amazon and then presumably to JB himself. So likely there is going to be diversity of citizenship no matter what is happening on the left side of the v.

Also, Nash Holdings, Inc. would like everyone to know that the "two company names are merely a coincidence" and there are "two separate business models" for the foundations, but only "the majority" of them.

https://www.nashholdingsinc.com/about-us-investments-pre-ipo

Posted by: hardreaders | Mar 3, 2020 5:45:19 PM

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