Tuesday, December 6, 2011

A Shot Across the Bow Over Excessive Demand Letters

A recent California Superior Court decision in Los Angeles rejected an anti-SLAPP motion filed by Hollywood celebrity attorney Martin Singer and held that an extortion complaint filed by Martin Malin could proceed to discovery and possibly trial.  In a pre-litigation demand letter, Singer sought a large payment to his client and threatened that, if action were withheld, he would file a complaint alleging that Malin had engaged in sexual misconduct, naming three individuals allegedly involved and enclosing a photograph as evidence of the seriousness of his intent to expose Malin.  The letter stated that because a draft of the complaint was being sent to a third party, “I have deliberately left blank spaces in portions of the complaint dealing with your using company resources to arrange sexual liaisons with —, —, and —.  When the complaint is filed with the Los Angeles Superior Court, there will be no blanks in the pleading.”  Apparently, one of the redacted names is that of a retired Superior Court judge,

Singer, represented by leading California anti-SLAPP attorney Mark Goldowitz, relied on a decision dismissing a suit over demand letters from DirectTV threatening suit over pirating satellite television signals to argue that demand letters could be speech protected by the anti-SLAPP statute.  According to a report of the oral argument on a Hollywood blog, Malin’s counsel, however, argued that Singer was implicitly threatening to take his accusations to the press, because “It is well known that the filing of complaints in court are picked up by the press, particularly in Los Angeles County.”

According to reports of the oral argument reported by the blog and by the Los Angeles Daily Journal, Judge Mary Strobel rejected the anti-SLAPP motion because the inclusion of the names of specific sexual partners, and the enclosure of a photograph of one of the partners, took the demand well-beyond the typical cease-and-desist letter.

Although the decision seems right on the merits, the mode of analysis is disturbing.  In deciding anti-SLAPP motions, the California court normally look first to see whether the speech is on a matter of public interest, or otherwise within the four categories of speech to which the anti-SLAPP statute applies; if it is, then it is the plaintiff’s burden to show a likelihood of success on the merits of the claim, both legally and factually.  Judge Strobel relied on an outlier from that principle, Flatley v, Mauro, in which the defendant had sent a demand letter threatening to sue for an alleged sexual assault and explicitly threatening to expose the sexual matters to the media.  The California Supreme Court said that the SLAPP statute does not apply ot speech that is illegal as a matter of law and that, on its face, the defendant’s communication was extortion.  According the Judge Strobel, because Singer’s demand letter was extortionate, it is unprotected speech and hence not protected by the anti-SLAPP statute; she thus did not need to decide whether plaintiff could show a likelihood of success on the merits.

The troubling aspect of this analysis is that a variety of speech is unprotected by the First Amendment if the court concludes, after trying the facts, that, for example, speech was defamatory, false, and published with actual malice.  What could have distinguished Flatley was that the extortionate aspect of the speech – the threat to go to the press with claims of sexual misconduct — was apparent on the face of the demand letter.  Here, though, plaintiff argued that it is enough that the speech at issue is “allegedly illegal,” and the quoted oral argument is only that the extortionate threat was implicit, because everybody knows that the press combs through new courthouse filings in Los Angeles looking for Hollywood dirt.  Although that seems to me to be a sound argument on the second prong, it is disturbing to see an expansion in the class of cases that can be deemed outside the anti-SLAPP statute without the plaintiff ever having to make a showing of merit.

Singer has reportedly stated his intent to appeal.  It is hard to work up a great deal of sympathy for a bully like Singer, but the case will be worth following.  At the same time, lawyers sending demand letters might draw some lessons of their own about not going too far overboard in their threats.