A recent Fifth Circuit opinion in a defamation action is raising concerns among media lawyers.

THE FIFTH CIRCUIT DECISION

In Block v. Tanenhaus,[1] Walter Block appealed the dismissal under Louisiana’s anti-SLAPP (strategic lawsuit against public participation) statute of his defamation action against the New York Times.  On appeal, Block argued that the anti-SLAPP statute was not applicable in federal court because it was procedural or alternatively, even if substantive, conflicted with the Federal Rules of Civil Procedure.  However, the Fifth Circuit found that he had forfeited that argument by failing to raise it in a prior appeal.  The court accordingly did not reach the issue whether a federal court exercising diversity jurisdiction may apply an anti-SLAPP law.  Instead, the court assumed without deciding that the anti-SLAPP law applied and found that Block had raised a fact issue precluding dismissal.

The cause for consternation is footnote 4 in which the court states that the applicability of state anti-SLAPP statutes in federal court is “an open question,” casting doubt on what had been thought to be settled law in the Fifth Circuit—that state anti-SLAPP statutes are enforceable in federal proceedings.

ANTI-SLAPP STATUTES 

Anti-SLAPP statutes have been enacted in many states to deter lawsuits brought to chill the exercise of First Amendment rights.  Generally, they provide that if a defendant files a motion to dismiss within 60 days after service of a complaint and shows that the action is in response to his exercise of the rights of free speech, petition or association, the case must be dismissed unless the plaintiff proves a prima facia case.  Once the motion is filed, discovery is stayed.  The statutes establish time limits for consideration of such motions to dismiss, grant the right to take an interlocutory appeal of the denial of such motions, and authorize the award of attorney’s fees if a claim is dismissed.

PROCEDURAL OR SUBSTANTIVE?

Whether anti-SLAPP laws apply in federal court turns on whether they are substantive or procedural.  As a general rule, federal courts sitting in diversity cases apply state substantive law and federal procedural rules.  But it is not always easy to discern the difference between substance and procedure.  Federal courts usually make a two-part inquiry.  First, they determine whether a state statute is procedural or substantive.  If procedural, federal rules apply.  If substantive, the next step is to decide whether the state law answers the same question as the federal rule; if so, then the federal rule applies.  If not, the state law applies.

CIRCUIT COURT SPLIT 

The circuit courts that have considered the question are in conflict.  The First[2] and Ninth[3] Circuits have held that the motion to dismiss and attorney’s fees provisions of anti-SLAPP statutes do not conflict with the federal rules.  The District of Columbia Circuit[4] has held the opposite.  Courts that apply anti-SLAPP statutes in federal court reason that the statutes are substantive and do not conflict with the federal rules.  Federal courts that refuse to apply anti-SLAPP laws do so because (1) they are procedural or (2) if they are substantive, they conflict with the federal rules so the federal rules control.

POLICY CONSIDERATIONS

There are legitimate policy concerns on both sides of the argument.  On the one hand, when applied in federal court, anti-SLAPP rules disrupt the integrated program of the federal rules, including leading to the anomalous result of allowing state legislatures rather than Congress to determine the jurisdiction of federal appellate courts.

On the other hand, if anti-SLAPP statutes are not applied in federal court, state and federal courts in the same state could reach different results such that “the accident of diversity of citizenship would constantly disturb equal administration of justice in coordinate state and federal courts sitting side by side.”[5]  This leads to the inequitable administration of law by giving plaintiffs greater rights in federal court than they would enjoy in state court, solely because of the fortuity that there is diversity of citizenship between the litigants.

This disparity encourages forum shopping.  If a federal court refuses to apply an anti-SLAPP statute, a plaintiff may choose to file there to take advantage of the more lenient federal dismissal rules.  Under anti-SLAPP dismissal rules, the factual sufficiency of a plaintiff’s case is tested by proof prior to any discovery.  In contrast, under federal rules, the sufficiency of a plaintiff’s case is tested prior to discovery only for legal sufficiency based solely on the pleadings.

Conversely, a defendant may choose not to remove to federal court.  By requiring early dismissal, anti-SLAPP statutes reduce the time and expense of defending meritless suits.  Under federal rules, a defendant can face expensive and protracted discovery before a motion for summary judgment disposes of the case.

In any event, it is important for litigants to know with certainty what law will apply.  If the Fifth Circuit does not resolve the issue perhaps—in light of the circuit split—the Supreme Court will.

[1] No. 16-30966, 2017 U.S. App. LEXIS 15278 (5th Cir. Aug. 15, 2017).
[2] Godin v. Schencks, 629 F.3d 79 (1st Cir. 2010).
[3] Makaeff v. Trump Univ. LLC, 715 F.3d 254 (9th Cir. 2013).
[4] Abbas v. Foreign Policy Group LLC, 783 F.3d 1328 (D.C. Cir. 2014).
[5] Kaxan Co. v. Stentor Elec. Mfg. Co., 313 U.S. 487, 493 (1941).