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A Huge Anti-SLAPP Victory by Morris & Stone in the Court of Appeal

Noe v J Niley Dorit

J. Niley Dorit v. Noe

At Morris & Stone, we sometimes take a case with an eye toward the greater legal implications. Prevailing for the client is of course our number one goal, but occasionally it is clear that the case could have legal implications beyond the dispute between the parties. This was such a case. It began as a, “well, that can’t be right” case, and morphed into a precedent that will control a small part of anti-SLAPP law until the universe reaches heat death.

Yet, it all started out so simply . . .

In January 2018, our client (we’ll call him Jack because that’s his name) hired an attorney named J. Niley Dorit to evaluate the medical records of Jack’s deceased mother for a potential medical malpractice suit against her doctors. The parties signed a fee agreement in which Jack agreed to pay Dorit a $10,000 non-refundable retainer fee. This sum was intended to cover Dorit’s time spent evaluating the claim, as well as “the costs of additional medical records and/or expert medical review if indicated.” The agreement contained an arbitration clause, which stated, “Should there arise any disagreement as to the amount of attorneys fees and/or costs, Client agrees to enter into binding arbitration of such issue or dispute before the Bar Association of San Francisco (BASF).”

On March 19, 2018, Dorit called Jack on the phone to present his analysis of the records. According to Dorit, Jack cut him off soon after Dorit began his presentation. Jack asked Dorit simply to provide his ultimate conclusion about the potential malpractice claim. Dorit said he did not think a malpractice claim was viable.

Jack was frustrated, feeling that Dorit had not provided $10,000 worth of services, especially given that he apparently had not consulted any medical experts. Conversely, Dorit felt that his experience with medical malpractice cases qualified him to review the file sufficiently to determine if a malpractice case was warranted. The medical file was huge, so Dorit felt he had earned his fee in examining the file.

The Mandatory Fee Arbitration Act

This is the sort of situation envisioned when the MFAA was was created. MFAA stands for Mandatory Fee Arbitration Act. Under California law, a client can challenge the fees charged by their attorney using this State Bar regulated process. It is designed to be very informal, and the arbitrator is not even required to follow the rules of evidence. It is a quick, low-cost way to have a fee dispute decided. Often the attorney fees involved in a fee dispute are relatively nominal, and it would never make economic sense to have to sue in court, let alone hire yet another attorney to do so. Rather than to force clients to stew in their own juices over the anger of having no recourse, the MFAA provides a quick review of the fees paid. And contrary to popular belief that the process is rigged in favor of attorneys, the MFAA arbitrators are very strict in determining if the attorney has observed all legal requirements.

Thus, a perfect process existed for Jack and Dorit to have the dispute decided, without going to court or even squaring off at ten paces. They submitted the fee dispute to MFAA arbitration. They presented their evidence to the Arbitrator, and ultimately he found in favor of Dorit, and allowed him to keep the $10,000 fee, awarding Jack nothing. Jack even had to cover the filing fee.

There are a couple of important things to know about the MFAA process. By law, a client always has the option to submit any fee dispute to arbitration. Sometimes it is the attorney who wants to sue to recover unpaid fees, but the attorney cannot take the matter to court without first giving the client the option to submit the dispute to arbitration. At that point, the arbitration is non-binding, unless the client then agrees to make it binding. If it is non-binding, then either party is free to reject the award of the Arbitrator and proceed to court.

Additionally, since the arbitration is so informal, and does not follow the rules of evidence, nothing from the arbitration can be used in any subsequent court proceeding. For example, had this matter proceeded to trial, Dorit would not have been permitted to bring up the fact that he had won the arbitration, or to bring up any of the arbitration testimony. It’s simply as though it never happened. This is because it would be entirely unfair to have a situation where clients are encouraged to go to an informal arbitration without the benefit of legal counsel, but then use the results of that hearing against the client in some other more formal forum, such as a trial.

OK; you now know everything you need to know about MFAA arbitrations. Back to our tale.

When we left our heroes, Dorit had won, and Jack was very unhappy with the result. But Jack has a code, and that code dictated that he had lost fair and square, and he would live with that result. Even though he would have been free to reject the conclusions of the Arbitrator, he did nothing and allowed the award to become final.

Dorit sues for Malicious Prosecution

But Dorit was not as accommodating. Dorit was upset that Jack had dared to question his entitlement to the $10,000 in fees, which he felt had been a malicious thing to do, so he sued Jack in San Francisco Superior Court for Malicious Prosecution. Read the rest of this entry »

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Discussions of a Doctor’s Competence Will Almost Always Fall Under the Anti-SLAPP Statute

anti-SLAPP peer review

Many years ago, I represented a woman who had posted a Yelp review about her lawyer, who sued her for defamation over the review. In response to my anti-SLAPP motion, the judge stated that the performance of a lawyer was not a matter of public interest, and therefore did not fall under the anti-SLAPP statute. The judge was incredulous that I would even make such a claim, saying that if my client had a problem with the lawyer’s performance, she should have complained to the State Bar.

He was wrong.

The appellate courts have since uniformly held that the performance of doctors and lawyers (and other professionals) are always a matter of public interest, since the public is generally interested in the competence of a doctor or lawyer they may be considering. In the specific case of a doctor, the peer review process also enjoys protection under the anti-SLAPP statute, albeit under a different provision.

So, when concerning a doctor’s competence, comments on a review site, or the peer review process, are protected. But what about the general comments concerning a doctor’s competence that are spread around a hospital? Would those too be protected? For example, what if the other doctors at a hospital warn patients about a particular doctor? That’s not really a public review, and it certainly isn’t part of the formal review process, so would such warning be covered by California’s anti-SLAPP statute? Read the rest of this entry »

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Does an anti-SLAPP appeal stay the action?

anti-SLAPP appeal stay

Does an anti-SLAPP appeal stay the entire action?

Seemingly, this question has been clearly answered ever since the Supreme Court ruling in Varian Medical Systems v. Delfino, way back in 2005, but I still see a lot of confusion on the topic.

As an example, I recently prevailed on an anti-SLAPP motion against an attorney, who was representing herself in a defamation action against my client. After the victory, as is my practice, I asked her if she wanted to pay the current attorney fees in order to avoid the extra expense of the motion for attorney fees.**

She chortled, “You can’t bring a motion for attorney fees, because I filed a notice of appeal regarding the ruling on the motion.”

After I prevailed on my motion for attorney fees, as is my practice, I called counsel to ask if she wanted to pay the (now greater) fees in order to avoid the extra fees for my time spent on collection, and the embarrassment of having her wages garnished at her law firm. (Yes, unlike typical collection efforts, the time spent on collecting attorney fees following an anti-SLAPP motion is recoverable.)

She chortled (what can I say? She’s a chortling fool), “You can’t seek to recover those attorney fees while an appeal is pending.”

We are currently receiving 25% of each of her paychecks while we await a date for oral argument on the appeal.

Allow me to take you through the Varian Medical Systems decision, because it lays out a good summary of the historical background on this point. These are the facts as summarized by the Supreme Court. Read the rest of this entry »

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Shia LaBeouf – An Anti-SLAPP Legend in His Own Mind

Shia LeBouf anti-SLAPP legend

Shia LaBeouf, the actor of Even Stevens and Transformers fame, walked into one of my favorite eateries, and was denied service by the bartender, who felt that LaBeouf had already had enough. As Hollywood teaches, everything is based on racism, so LaBeouf immediately assumed that the refusal had to be based on racism, and called the bartender a “fucking racist” and “fucking racist bitch” (hereinafter, ‘FRB”). In classic, “do you know who I am?” fashion, LaBeouf pounded his fist on the bar counter, and yelled “you’re not going to fucking serve me?”, before going around behind the bar to confront the bartender, who felt sufficiently threatened to arm himself with a bottle of Grey Goose vodka.1 LaBeouf was escorted from the bar.

The bartender took umbrage with being called an FRB in a restaurant full of people, so he sued LaBeouf for defamation. After foolishly failing to consult with me, LaBeouf responded with an anti-SLAPP motion, and here’s where things get fun. Why would anyone on God’s green earth think that this defamation action would be subject to an anti-SLAPP motion? What is the public interest that would bring it under the statute?

But before accusing LaBeouf and his attorneys of being foolish for thinking that the an anti-SLAPP motion would apply to these facts, allow me to throw them a small bone by providing a little legal context. Read the rest of this entry »

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Never Forget that the Plaintiff’s Declaration is Taken as True

Evidence on anti-SLAPP motions.

I see too many cases where attorneys have properly identified that the allegations of a particular complaint fall under the anti-SLAPP statute, but then fail to complete the analysis. An anti-SLAPP motion is only viable if the second element favors the defendant. For a successful anti-SLAPP motion, if must be the case that the plaintiff will not be able to show that he is likely to prevail, and that determination is made base on the plaintiff’s evidence, which is taken as true.

For the second step of the anti-SLAPP analysis, it must always be remembered that the court is not permitted to weigh the evidence; indeed, the evidence offered by the plaintiff is taken as true, even if defendant offers contrary evidence.

I get shocked silence followed by howls of protest when I explain this to potential clients. How is it possible that the plaintiff’s evidence should be taken as true, to the exclusion of all the great evidence that defendant can offer? Read the rest of this entry »

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Is it Defamatory to Call Someone “Racist”?

In today’s political climate, the term “racist” gets used in seemingly every discussion. I get at least one call a week from a potential client wanting to sue someone for defamation because they were called a racist.

But is it defamatory to call someone “racist”? Would such an action be viable? To answer that question, let’s first set the legal scene, beginning with the elements of defamation.

The elements of a defamation claim are (1) a publication that is (2) false, (3) defamatory, (4) unprivileged, and (5) has a natural tendency to injure or causes special damage. (Taus v. Loftus (2007) 40 Cal.4th 683, 720.) The elements for libel and slander differ slightly, but both require a false and unprivileged statement. Read the rest of this entry »

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Stormy Daniels’ Action Against Trump Goes Down in Flames

Stormy Daniels Complaint on Fire
As I discussed back in October, adult film star Stormy Daniels was originally suing Donald Trump under a declaratory relief action, seeking to invalidate a “hush” agreement she has signed and been paid for. Her attorney, Michael Avenatti, then tried to get cute by filing a defamation action. The alleged defamation resulted from an incident that purportedly occurred in a parking lot, where Daniels says she was threatened to keep her mouth shut. Trump referred to the story as a “con job,” and Avenatti on behalf of Daniels claimed that amounted to defamation since Trump was accusing Daniels of lying. I predicted at the time that the action would be thrown out on an anti-SLAPP motion, and that proved to be true. Daniels was hit with $293,000 in attorney fees.

But following the dismissal of the defamation action, I pointed out that still left the original declaratory relief action. Since the attorneys have presumably spent far more time on that matter than the ridiculous defamation claim, I said that Avenatti might get the last laugh as to attorney fees if he was able to prevail on that claim.

Avenatti isn’t laughing.

Read the rest of this entry »

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SLAPP027 – When a Motion to Dismiss is a Better Strategy than an Anti-SLAPP Motion

President Trump is never short on controversy, and said controversy leads to some interesting cases. In Episode 27 of the California SLAPP Law Podcast, we will discuss two Trump cases — one First Amendment and one anti-SLAPP — arising from the words and tweets of our sneerless leader. We’ll also discuss when a motion to dismiss can be a better option than an anti-SLAPP motion.

The first case is Nwanguma v. Donald Trump, arising from his comments at a political rally before he was elected. When hecklers tried to shout him down, he said “get ’em out of here.” The crowd heeded his words and bodily removed the protesters, who then sued for battery and incitement. They claimed that by saying “get ’em out of here,” Trump incited the crowd to riot. Trump moved to dismiss, arguing that his words were mere hyperbole. How did the court rule? Listen to Episode 27 and find out!

Next comes the infamous case of Stormy Daniels v. Donald Trump. Daniels sued Trump in two different forums for two different claims. In one, she is simply trying to get out the contract whereby she was paid for her silence. In the other, she had stated during a press conference that she had been threatened by a man who told her to be quiet about sleeping with Trump, even showing an artist’s rendering of the allege suspect from many years prior. Trump felt compelled to tweet that the story was a total “con job.”

Her attorney, Michael Avenati, who would have known better if he listened to the California SLAPP Law Podcast, decided to sue for defamation for Trump’s usage of the phrase “con job.” As any regular listener would know, “con job” is just too imprecise to support a defamation claim. It is not verifiably false, and without a verifiably false statement, there can be no defamation. Trump brought an anti-SLAPP motion, which was granted.

Not a good week for Avenati. In the same week that the court granted Trump’s anti-SLAPP motion, finding that Daniels would therefore be liable for all of Trump’s attorney fees, Avenati was found personally liable for a multi million dollar judgment by a former associate at his firm, and was given an eviction notice from his law offices for failure to pay rent.

And stay around for the after show, where I discuss the happenings with Bell v. Feibush, some precedent I created six years ago.

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Daniels’ Defamation Action Against Trump was Doomed from the Start

I have frequently warned about the path defamation claims can take, and it was illustrated once more by the kerfuffle between Donald Trump and Stormy Daniels.

Here is the pattern.

Way outside every controlling statute of limitations, a woman states she was assaulted by a man, and the man responds by going on social media or stating to the press that the assault never occurred. The woman then sues for defamation, claiming that by denying the assault, the man is calling her a liar. As a variation, the accused man sometimes comes right out and says she is lying.

It’s a tough situation for the accused. If he fails to deny the charge, then it will be assumed that it must be true, but if he does deny it, then he buys himself a defamation action. He was safe from legal action, but his words started a whole new statute of limitations on the defamation claim. This is precisely what happen when Bill Cosby denied raping various women, which lead to very different conclusions.

Defamation claims against Bill Cosby.

Read the rest of this entry »

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SLAPP026 – Don’t Sue for Defamation Unless the Statements Really are False

Canada, eh? Those hosers in Ontario didn’t get around to passing an anti-SLAPP statute until 2015, and they’re still trying to figure it out.

In this episode of the California SLAPP Law Podcast, we travel to the great white north to examine an anti-SLAPP motion that was denied by the trial court, but granted by the appellate court. It beautifully illustrates the most fundamental point of a defamation case that oh so many attorneys still don’t understand. A statement is not defamatory unless it is false, no matter what the quantum of harm it may cause.

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Aaron Morris, Attorney
Aaron Morris
Morris & Stone, LLP

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(714) 954-0700

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