On August 3, 2016, the Ninth Circuit issued an opinion in the case Travelers Casualty Insurance Company of America v. Robert Hirsh.
The Court affirmed the district court’s denial of Robert Hirsh’s anti-SLAPP motion (Cal. Civ. Proc. Code § 425.16) to strike the second amended complaint filed by Travelers Casualty Insurance Company of America. Hirsh had alleged that Travelers’ claims arose out of his representation of Travelers’ insured, Visemer De Gelt, as Cumis counsel; and his activity was therefore protected under the anti-SLAPP statute.
The Ninth Circuit held that because Travelers’ causes of action were not based on an act in furtherance of Hirsh’s right of petition or free speech, they did not “arise from” protected activity, and thus did not satisfy the first prong of the anti-SLAPP analysis. The Court also held that Travelers established a probability of prevailing on the merits sufficient to survive a motion to strike. The Court further held that California’s litigation privilege, Cal. Civ. Code § 47(b), did not bar the suit because the causes of action arose from Hirsh’s post-settlement conduct, not his communications with De Gelt in settling a prior lawsuit.
Should we allow anti-SLAPP motions in Federal Court?
But like a number of appellate judges in the Ninth Circuit, Judge Kozinski and Judge Gould, although they concurred in the opinion, could not pass up the opportunity to complain about how anti-SLAPP motions in federal court were making them work too hard. Judge Kozinski decried that the existing case law is wrong, and he would urge the court to follow the D.C. Circuit’s holding in Abbas v. Foreign Policy Grp., LLC, which held that anti-SLAPP motions do not belong in federal court because they directly conflict with the Federal Rules of Civil Procedure. At the very least, Judge Kozinski urged the court to reconsider the holding in Batzel v. Smith, which allows defendants who lose anti-SLAPP motions to bring an immediate interlocutory appeal.
With all due respect, the reasoning of Judge Kozinski does not withstand scrutiny, as will be shown hereinbelow. What follows is Judge Kozinski’s concurring opinion, with my response to him in red on each of his points.
KOZINSKI, Circuit Judge, with whom Circuit Judge GOULD joins, concurring:
I must join because the opinion faithfully applies our circuit’s precedents, which accord federal-court defendants the procedural advantages of California’s anti-SLAPP law. See Batzel v. Smith, 333 F.3d 1018, 1024-26 (9th Cir. 2003); United States ex rel. Newsham v. Lockheed Missles & Space Co., 190 F.3d 963, 970-73 (9th Cir. 1999). But I write once again to emphasize that our caselaw** is wrong: These interloping state procedures have no place in federal court. See Makaeff v. Trump Univ., LLC, 715 F.3d 254, 272 (9th Cir. 2013) (Kozinski, C.J., concurring).
Our precedents have not aged with grace. Ever since we allowed them to take root, anti-SLAPP cases have spread like kudzu through the federal vineyards. A casual Westlaw search suggests that such cases have more than tripled over the last ten years. And nowhere are anti-SLAPP cases more common than in the Ninth Circuit: The Westlaw data suggest that courts in our circuit have heard 80 percent of these cases over the same decade. In other words, 80 percent of the problem is right here.
“Take root”, like a weed. Kudzu, in case you don’t know (I didn’t), is a fast-growing, invasive vine native to Asia, that was planted extensively in the U.S. in the 1940s, with the thought that it was a great ground cover, but which is now classified as a noxious and uncontrollable weed. That’s how Judge Kozinski views California’s anti-SLAPP statute.
Fortunately, other circuits are starting to recognize this problem for what it is. When our court last considered the place of anti-SLAPP motions in federal court, some of our colleagues saw unanimity among our sister circuits and were reluctant to create a split. See Makaeff v. Trump Univ., LLC, 736 F.3d 1180, 1187 (9th Cir. 2013) (Wardlaw and Callahan, JJ., concurring in the denial of rehearing en banc). We can stop worrying: The D.C. Circuit has reached the overdue conclusion that anti-SLAPP motions don’t belong in federal court because they directly conflict with the Federal Rules of Civil Procedure. Abbas v. Foreign Policy Grp., LLC, 783 F.3d 1328, 1333-37 (D.C. Cir. 2015). Now we’ve got a circuit split, and we’re standing on the wrong side.
Not really, Judge Kozinski. You also complained about anti-SLAPP motions in Makaeff v. Trump Univ., and in responding to your complaining, Judge Watford, noticed that you wanted to overrule Batzel v. Smith, “not because of any intervening Supreme Court decision or conflicting curcuit opininion, but because [you] find Batzel’s reasoning ‘unpersuasive.’” The fact that there was unanimity was cool and all, but that wasn’t the reason for refusing to overrule Batzel. Rather, Judge Watford was commenting on the fact that there was no support for your position in the other circuits. Besides, the fact that one circuit has reached a contrary conclusion isn’t really much of a split.
It’s time to get it right. We should follow the D.C. Circuit’s lead in giving these trespassing procedures the boot. At the very least, we should reassess whether defendants who lose on their anti-SLAPP motions have the right to an immediate appeal. Either would be a welcome step toward cleaning up our docket and securing the border between state and federal law.
See? You thought I was being a little pejorative when I said that the real motivation is to lessen the work load of the appeal judges. But note the words, “a welcome step toward cleaning up our docket”. Never mind that California’s anti-SLAPP statute protects free speech and the right of redress and prevents lawsuits from being used to silence criticism, he wants these time-consuming motions off his docket.
Let’s review the basics: Every first-year law student learns (or is supposed to learn) that federal courts in diversity cases apply state law to substantive questions. Was the contract breached? Was the accident negligent? See Erie R.R. v. Tompkins, 304 U.S. 64, 78-79 (1938). But procedural questions are different. When the state law directly conflicts with one of the Federal Rules, the outcome is simple: The Federal Rules trump.
Wow. Speaking of pejorative. That is an amazing attack on your colleagues. That can only be read as, “what any idiot should know . . .”
California’s anti-SLAPP law directly conflicts with Federal Rule 12, which provides a one-size-fits-all test for evaluating claims at the pleading stage. To survive a 12(b)(6) motion to dismiss, a plaintiff’s complaint has to state a claim that is “plausible on its face.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007). California, on the other hand, gives defendants a “special motion to strike” any claims that arise from protected speech activities. Cal. Civ. Proc. Code § 425.16(b)(1). To survive this motion, a plaintiff must show that he has a “probability” of succeeding on the underlying claim. Id. This requires demonstrating that the claim is legally sufficient and “supported by a sufficient prima facie showing of facts to sustain a favorable judgment if the evidence submitted by the plaintiff is credited.” Wilson v. Parker, Covert & Chidester, 50 P.3d 733, 739 (Cal. 2002) (citations omitted).
In short, “probability” is a much higher bar than “plausibility”: California’s special motion requires supporting evidence at the pleading stage; Rule 12 doesn’t. That’s a problem because the Supreme Court has decided that the plausibility standard alone strikes the right balance between avoiding wasteful litigation and giving plaintiffs a chance to prove their claims. See Twombly, 550 U.S. at 556; see also Ashcroft v. Iqbal, 556 U.S. 662, 679 (2009). The Supreme Court’s balance might be the wrong one, of course, but that’s not something that the state of California gets to decide. The plausibility standard isn’t a floor or a ceiling from which we can depart. Using California’s standard in federal court means that some plaintiffs with plausible claims will have their cases dismissed before they’ve had a chance to gather supporting evidence. It’s obvious that the two standards conflict.
It’s not obvious, or even correct, “that the two standards conflict.” For example, in California, a defendant can attack a complaint in a number of different ways, including by way of a motion to strike or a motion for summary judgment. With a (garden variety) motion to strike, the allegations of the complaint are taken as true. With a motion for summary judgment, the court may consider evidence. Both motions can potentially dispose of an action, but they have different approaches. They don’t “collide” just because they have different standards. A court would never conclude that a motion for summary judgment is an impermissible procedure because a motion to strike requires that all evidence must be taken as true. I understand that whether state procedures collide is not the issue, but bear with me.
So it is when an anti-SLAPP motion is pursued in federal court. As explained in Makaeff v. Trump University, Rule 12 provides a mechanism to test the legal sufficiency of a complaint. The question asked by Rule 12 is whether the plaintiff has stated a claim that is plausible on its face and upon which relief can be granted. California’s anti-SLAPP statute does not attempt to answer this question; instead, section 430.10, the state statutory analog of Rule 12, does. That the California legislature enacted both an analog to Rule 12 and, additionally, an anti-SLAPP statute is strong evidence that the provisions are intended to serve different purposes and control different spheres. Moreover, the anti-SLAPP statute asks an entirely different question: whether the claims rest on the SLAPP defendant’s protected First Amendment activity and whether the plaintiff can meet the substantive requirements California has created to protect such activity from strategic, retaliatory lawsuits.
Furthermore, the contention that CCP § 425.16 imposes a probability requirement at the pleading stage ignores California Supreme Court precedent. Although § 425.16 asks courts to determine whether “the plaintiff has established that there is a probability that the plaintiff will prevail on the claim,” the California Supreme Court has held that past California state cases interpreting this provision establish that the Legislature did not. Taus v. Loftus, 40 Cal. 4th 683, 714 (2007). In other words, a reviewing court “should grant the motion if, as a matter of law, the defendant’s evidence supporting the motion defeats the plaintiff’s attempt to establish evidentiary support for the claim.” Vargas v. City of Salinas, 46 Cal. 4th 1, 20 (2009). Thus, even if § 425.16 and Rule 12 serve similar purposes, at worst, a motion to strike functions merely as a mechanism for considering summary judgment at the pleading stage as is permitted under Rule 12(d). California also has a state statutory equivalent to Rule 56. See Cal. Civ. Proc. Code § 437c(c). (“The motion for summary judgment shall be granted if all the papers submitted show that there is no triable issue as to any material fact and that the moving party is entitled to a judgment as a matter of law.”). And as already explained, the test for legal sufficiency embodied in § 425.16 conflicts with neither Rule 12 nor Rule 56.
It is not as though seeming procedural conflicts of this sort have never been addressed by the Supreme Court. In Cohen v. Beneficial Industrial Loan Corp., 337 U.S. 541 (1949), the Supreme Court determined that a New Jersey statute that required certain plaintiffs to post a bond in shareholder derivative suits could be enforced consistent with former Federal Rule 23 (now Rule 23.1).
New Jersey had enacted the statute in question to protect against so called “strike suits,” that is, suits “brought not to redress real wrongs, but to realize upon their nuisance value.” Id. at 547–48. The New Jersey statute made it more difficult to maintain a shareholder derivative suit than did Federal Rules, by imposing additional requirements such as a verified complaint, proof that plaintiff was a stockholder at the time of the transaction at issue, and that the action not be dismissed without approval of the court and notice to all parties. Despite the fact that the state statute created an additional and indeed onerous requirement for the maintenance of a shareholder derivative suit, the Supreme Court determined that the state statute did not conflict with the requirements of Rule 23 and therefore should apply in federal court.
Just as the New Jersey statute in Cohen sought to limit frivolous strike suits, California’s anti-SLAPP statute seeks to limit frivolous suits brought primarily for the purpose of chilling the valid exercise of First Amendment rights. And, just as the state statute in Cohen did not conflict with former Rule 23 even though it created supplemental, even onerous requirements for certain plaintiffs, the motion to strike and attorneys’ fees provisions of California’s anti-SLAPP statute
do not conflict with Rules 12 and 56 even though they create supplemental requirements for certain plaintiffs.
But it wasn’t so obvious to our court. In Newsham, we erroneously reasoned that Rule 12 and the California statute were at peace because a defendant could still bring a Rule 12 motion if his special motion to strike was unsuccessful. 190 F.3d at 972. But what’s the point? If a plaintiff survives an anti-SLAPP motion by showing that his claim is legally sufficient and has a probability of success, how could he lose on a Rule 12 motion that requires him to show mere plausibility? He can’t.
You just made my point. If the case has nothing to do with protected speech or activities, and the defendant is challenging the sufficiency of the complaint under Rule 12, then the plaintiff need only show “mere plausibility”. If, on the other hand, the defendant is challenging the complaint on the grounds that it involves protected speech, then we apply a tougher standard for the plaintiff, because we are all good Americans who cherish free speech, and thus require the plaintiff to show a likelihood of success.
Your reasoning that a plaintiff could never lose on a Rule 12 motion after defeating an anti-SLAPP motion is not well taken. The anti-SLAPP analysis is comprised of two prongs. A defendant could bring an anti-SLAPP motion and lose on the first prong with a finding that the conduct in question is not protected. A complaint could thus be utterly implausible under a Rule 12 analysis, and therefore subject to dismissal, but still be sufficient to defeat an anti-SLAPP analysis.
Perhaps what you meant to say is that if an action is found to satisfy the first prong of the anti-SLAPP analysis, and Plaintiff then demonstrates that he is likely to succeed, there is no scenario where, as to those claims, the plaintiff would lose under a Rule 12 motion. True, as to those specific claims, but the Rule 12 motion could attack other claims. In any event, using your reasoning, you’ve just illustrated that the two rules are not in conflict. What is true under the anti-SLAPP motion would be true under Rule 12.
Our acceptance of anti-SLAPP special motions was bad enough [such motions being uncontrollable vines that make us work and all], but we made the problem worse by allowing defendants to bring interlocutory appeals. See Batzel, 333 F.3d at 1024-26. This case is a perfect example of the consequences of that decision. Robert Hirsh appealed to our court after the district court denied his meritless motion to strike. That was in the spring of 2014. Two years and a few hundred billable hours later, we’re sending the case back for the district court to pick up right where it left off.
But we being good Americans who cherish free speech, understand that while there will be appeals from anti-SLAPP motion denials that uphold those denials, there will also be appeals from denials where the court reverses the District Court’s conclusion, thereby satisfying the anti-SLAPP statute’s goal of preventing these matters from going to trial. Isn’t that result worthy of a little extra work? I can come in on Saturdays to work on these denial appeals if that will help assuage your docket concerns.
To avoid these pointless and costly detours, parties usually get to appeal only once, after the district court has entered its final judgment. See Mohawk Indus. Inc. v. Carpenter, 558 U.S. 100, 106 (2009). The collateral order doctrine provides an exception, but only a select number of decisions are supposed to get into this exclusive club. See Dig. Equip. Corp. v. Desktop Direct, Inc., 511 U.S. 863, 867-68 (1994). Despite many efforts to expand the guest list, the Supreme Court has kept the collateral order doctrine “narrow and selective in its membership.” Will v. Hallock, 546 U.S. 345, 350 (2006). Undaunted by the Supreme Court’s repeated warnings, our circuit has welcomed anti-SLAPP appeals with open arms. Batzel, 333 F.3d at 1024-26; see also DC Comics v. Pac. Pictures Corp., 706 F.3d 1009, 1012-16 (9th Cir. 2013) (reaffirming Batzel).
Again, I’m available on Saturdays.
But this inclusive spirit was a mistake. A collateral order is supposed to meet three requirements: It must be “conclusive”; it must “resolve important questions completely separate from the merits”; and it must be “effectively unreviewable” after final judgment. Dig. Equip. Corp., 511 U.S. at 867. A decision on the motion to strike fails the latter two of the three.
Anti-SLAPP motions have the merits painted all over them. California’s statute asks us to determine whether “there is a probability that the plaintiff will prevail on the claim.” Cal. Civ. Proc. Code § 425.16(b)(1). This can mean only one thing: an evaluation of the merits. Batzel tried to explain away this unfortunate textual obstacle by musing mysteriously that a court denying an anti-SLAPP motion is “merely find[ing] that such merits may exist, without evaluating whether the plaintiff’s claim will succeed.” 333 F.3d at 1025. Ponder that. Perhaps a poet can explain how a determination that the merits exist can be “completely separate” from those merits. But our circuit hasn’t done it yet.
There once was a judge from the Ninth Circuit,
Who, as to anti-SLAPP, really wanted to rework it.
He failed to understand,
Though his pontification was grand,
That plaintiff need only show “a minimum level of legal sufficiency”, or shirk it.
And it can’t. Our experience with these cases has shown us that they require an “exhaustive analysis of the merits.” See Makaeff, 736 F.3d at 1190 (Watford, J., dissenting from the denial of rehearing en banc). An exhaustive (and exhausting) detour is exactly what the final judgment rule is designed to avoid. Interlocutory appeals make it hard for a district court to supervise a trial. Johnson, 515 U.S. at 309. They undermine the efficient administration of justice when, as here, a meritless appeal stalls a case for years. See Mohawk Indus., 558 U.S. at 106. And they ask our court to dive headlong into the merits of a case only to swim back, years later, when it’s finally appealed from final judgment.
It still sounds like complaints about the appellate workload to me.
Of course, if our precedents are correct, we must take interlocutory appeals from the denial of anti-SLAPP motions because they would be effectively unreviewable after final judgment. Batzel, 333 F.3d at 1025. But we don’t need to look very far to see that this holding is completely out of step with how we treat similar orders. After all, the denial of a 12(b)(6) motion isn’t immediately appealable, and Rule 12 and California’s anti-SLAPP statute serve a common purpose: eliminating frivolous or bullying claims before the parties pay through the nose in discovery and suffer the other indignities of a trial. Nobody suggests that the district court’s decision denying a 12(b)(6) motion is “effectively unreviewable” at the end of the case because the defendant has to incur an extra cost to get there. But that’s exactly the reasoning our court has adopted to allow immediate appeals from denials of anti-SLAPP motions.
And very good reasoning it is. An appeal from denial of a Rule 12 motion is not immediately appealable, because Rule 12 was not written to satisfy a strong public policy favoring a quick resolution of lawsuits designed to silence criticism. Not every type of case can be afforded an immediate right of appeal, but that does not mean that none can.
In Batzel, we made anti-SLAPP motions sound more impressive by asserting that they gave defendants a form of “immunity” from suit. 333 F.3d at 1025. Because immunity would be useless if the defendant had to wait to appeal, we found that denying a special motion would indeed be “effectively unreviewable” after final judgment. Id. The suggestion that California had granted certain defendants immunity from suit should have immediately put us on high alert, because claims of a “right not to be tried” are supposed to be viewed “with skepticism, if not a jaundiced eye.” Dig. Equip., 511 U.S. at 873. And we should have been especially skeptical here because the statute itself makes no mention of immunity. Cal. Civ. Proc. Code § 425.16. Either way, tossing around the magic word immunity shouldn’t distract us from the substantive point: What does an anti-SLAPP motion confer that Rule 12 doesn’t? While they’re different in degree, both procedures save a defendant from a costly lawsuit when the plaintiff’s complaint hasn’t met a threshold standard. Both are about reducing the incentive to bring frivolous claims. Defendants who claimed that Rule 12 provided them with “immunity from suit” would get laughed at. Anti-SLAPP defendants who make the same claim should be treated no differently.
So I guess what you are saying is that the use of the word “immunity” should have put the court on high alert to laugh because the concept was so ridiculous. I see no issue with using the word “immunity”, which is defined as “protection or exemption from something, especially an obligation or penalty.” Rule 12 provides immunity against frivolous actions, where the plaintiff cannot show a “mere plausibility” of succeeding.” Section 425.16 provides immunity against actions involving protected activities, where the plaintiff cannot show a likelihood of success.
Some of our recent decisions have started to turn the tide against these encroaching state procedures. [Those damn vines again.] In Metabolife International, Inc. v. Wornick, we held that a provision of the law that stayed discovery while a special motion was being decided conflicted with Federal Rule of Civil Procedure 56(f)’s discovery requirement and didn’t belong in federal court. 264 F.3d 832, 846 (9th Cir. 2001). [“Recent decisions”?] And we recently pulled another tooth from the law, holding that federal plaintiffs can’t immediately appeal some grants of special motions because doing so would conflict with Rule 54(b)’s definition of appealable final orders. Hyan v. Hummer, No. 14-56155, slip op. at 5-8 (9th Cir. June 14, 2016) (per curiam).
Now it’s time to deliver the coup de grâce. We were wrong in Newsham and Batzel, and wrong not take Makaeff en banc to reverse them. But it’s not too late to correct these mistakes. Cases like this one have no place on our docket, and we should follow the D.C. Circuit in extirpating them. Our ink and sweat are better spent elsewhere.
Where, pray tell, is your ink and sweat better spent? Again, if ultimately it is just a time thing, my Saturday offer still stands.
I am, afterall, the anti-SLAPP guy, so my bias in favor of anti-SLAPP motions in federal court should not be a surprise. But I am not at all persuaded by Judge Kozinski’s arguments. There is no collision between state and federal procedures. They are simply different procedures.
Especially noteworthy is Judge Kozinski’s complete failure to address the issue of forum shopping. As every first-year law student learns (or is supposed to learn), back in the bad old days of Swift v. Tyson, the federal courts thought they were so above the laws of the states, that they need not apply the unwritten law of the state as declared by its highest court; that they were free to exercise an independent judgment as to what the common law of the state is, or should be.
Until Erie Railroad Company v. Tompkins overturned Swift v. Tyson non-citizens of a state had greater rights than the citizens. The citizens were bound by decisional law, while outsiders were not. The federal courts ignored state law, and created their own “federal general common law”.
Undesirable state laws could be avoided by simply pursuing an action in federal court. The Erie court cited to the example of one company in Kentucky, which upon realizing that Kentucky law would not support what it wanted to accomplish, simply formed a corporation in Tennessee and then sued in diversity in Kentucky federal court, in order to avoid the state laws. Erie held that it was improper to subvert state law in this manner.
As set forth in section 425.16: “The Legislature finds and declares that it is in the public interest to encourage continued participation in matters of public significance, and that this participation should not be chilled through abuse of the judicial process.” Prohibiting anti-SLAPP motions in federal court would simply permit those wanting to chill protected activities to do so by filing their abusive actions in federal court.
The protections afforded by California’s anti-SLAPP statutes should not be subverted just, as Judge Kozinski put it, to clean up his docket.
** Go here for the great controversy as to whether “case law” or “caselaw” is proper. (I note that caselaw comes up as a misspelling in WordPress.)