Tuesday, September 17, 2013

It's not about the drugs: Lance Armstrong lawsuit fails

Stutzman v. Armstrong, No. 2:13–CV–00116, 2013 WL 4853333 (E.D. Cal. Sept. 10, 2013)
Plaintiffs sued Lance Armstrong, his publishers, and related defendants for violations of California’s consumer protection laws (and related state torts) based on alleged misrepresentations in and surrounding Armstrong’s books, including It’s Not About the Bike: My Journey Back to Life (Penguin), Every Second Counts (Random House), The Lance Armstrong Program: 7 Weeks to the Perfect Ride, Images of a Champion, and Comeback 2.0: Up Close and Personal.  The court found that California’s anti-SLAPP law applied and that plaintiffs failed to survive it.  The first two were best-sellers, and allegedly enabled Armstrong to publish and profit from the rest.

Defendants’ promotional efforts allegedly represented the books as truthful and honest works of nonfiction biography/autobiography when defendants knew or should have known that they weren’t.  Plaintiffs alleged that they wouldn’t have bought the books, or would’ve paid less for them, had they known the truth about “Armstrong’s lies and misconduct and his admitted involvement in a sports doping scandal that has led to his recent public exposure and fall from glory.”  Defendants’ promotional efforts were allegedly critical to Armstrong’s success, portraying him as a devoted advocate for cancer patients. Thus, an integral part of maintaining and growing the Lance Armstrong “brand” “was to vociferously and publicly deny any charge that Armstrong used performance enhancing drugs.”  Random House and Penguin allegedly stuck their heads in the sand on the merits of the doping charges so that they could keep making money.

California’s anti-SLAPP law makes it harder to maintain lawsuits arising from any act in furtherance of the right of petition or free speech in connection with a public issue.  Plaintiffs have to establish a probability of prevailing to survive a special motion to strike once the defendant makes a threshold showing of coverage.  This requires a sufficient prima facie showing to sustain a favorable judgment if the plaintiff’s evidence is credited, but a court shouldn’t weigh the credibility or comparative strength of competing evidence. 

Here, defendants’ conduct was “in connection with a public issue or an issue of public interest,” thus falling into one of the protected categories.  Though the anti-SLAPP law doesn’t define public interest or public issue, and though not everything the public finds watchable is therefore of “public interest,” the court concluded that Armstrong’s life story was.  One set of California cases has identified three categories of public issues: (1) statements “concern[ing] a person or entity in the public eye”; (2) “conduct that could directly affect a large number of people beyond the direct participants”; (3) “or a topic of widespread, public interest.”  Statements about Armstrong fit (1) and (3), given Armstrong’s fame and his books’ bestseller status.  Other California case law has a somewhat more restrictive test, distinguishing public interest from mere curiousity and requiring that the issue be of concern to a “substantial number” of people, not a relatively small, specific audience.  Also, “there should be some degree of closeness between the challenged statements and the asserted public interest; the assertion of a broad and amorphous public interest is not sufficient.” And a person “cannot turn otherwise private information into a matter of public interest simply by communicating it to a large number of people.”  But even under that more restrictive test, defendants’ speech still related to the public interest.  The connection between the challenged statements—statements promoting the book and denying Armstrong’s drug use—was direct.  A private controversy, even one between famous people, isn’t enough, but Armstrong’s books weren’t just about the personal details of his life.  They dealt with his public cycling career and cheating in the Tour de France—public activities, “which are the very things that interest people about [him].”

Plaintiffs argued that the anti-SLAPP law didn’t shield speech that’s not constitutionally protected because it’s in furtherance of illegal activity.  But “conduct that would otherwise come within the scope of the anti-SLAPP statute does not lose its coverage simply because it is alleged to have been unlawful or unethical.”  Instead, the speech loses protection “only if it is established through defendant’s concession or by uncontroverted and conclusive evidence that the conduct is illegal as a matter of law.”  Here, plaintiffs failed to provide conclusive evidence that Armstrong’s doping denials, the content of the books, and the promotional materials for the books were themselves criminal.  Also, the crime exception requires the protected conduct at issue to be itself criminal.  Armstrong may have broken the law in smuggling/trafficking drugs, but that’s not the conduct at issue—it’s his lies about his use of drugs, which aren’t criminal conduct.

In 2003, the legislature amended the anti-SLAPP statute to exclude from its coverage “any action brought solely in the public interest or on behalf of the general public” and certain causes of action arising from commercial speech.  However, these exclusions don’t apply to “[a]ny action against any person or entity based upon the creation, dissemination, exhibition, advertisement, or other similar promotion of any dramatic, literary, musical, political, or artistic work, including, but not limited to, a motion picture or television program, or an article published in a newspaper or magazine of general circulation.”  Hilariously and perhaps uniquely, given the history of discrimination against movies, the court spends a bit of time finding that books are as protected by this provision as movies are, even though they aren’t specifically listed and even though mostly the proponents of the amendment talked about movies and TV.  (California!)

The court then turned to whether plaintiffs showed a reasonable probability of prevailing on their claims.  They didn’t.

First, defendants argued that the UCL, FAL and CLRA failed because California’s consumer protection laws govern only commercial speech.  Under Bolger, speech can be characterized as commercial when it’s admittedly advertising, references a specific product, and is spoken with an economic motive.  Commercial speech inextricably intertwined with otherwise fully protected speech becomes fully protected.  There were three types of speech at issue here: (1) statements in the books; (2) promotional statements about the books, including copy on the flyleaves and covers; and (3) statements about Armstrong’s drug use that didn’t specifically reference or promote the books.

Statements in the books weren’t commercial speech; they did more than propose a commercial transaction.  Plaintiffs argued that the books weren’t entitled to full First Amendment protection because that’s not how they were sold—they were part of a branding effort. The court didn’t agree: books are core First Amendment-protected expression.

Likewise, the statements about Armstrong’s use of drugs did more than propose a commercial transaction; they didn’t propose a commercial transaction at all.  Also, they weren’t ads and didn’t refer to a specific product. The court was unwilling to consider Armstrong himself the brand or product at issue.  Though defendants likely had underlying economic motives from these statements, that was insufficient to make them commercial speech.

Finally, what about statements promoting the books?  These included claims that each of the books was a “nonfiction ‘biography’ “ about the “Tour De France Winner” or the “Five Time Tour de France Winner.”  The court held that the speech did more than merely propose a commercial transaction because it described the books’ contents and authors.  (If the subject of the offer hadn’t been a book, describing its features would be part of “merely” proposing a commercial transaction—proposing a transaction is more than “I’ll sell you X for $Y” and certainly includes factual claims about what the X on offer is.)  Here, the statements had components of both noncommercial speech and commercial speech, seeking both to entice and to inform.

For some reason focusing on language about whether a statement is “admittedly” an ad, the court found that defendants vehemently denied that the statements on flyleaves etc. were ads, thus weighing against a finding that they were commercial speech. (When the defendant is fighting the commercial speech characterization, this inquiry would be better understood as whether a statement has a traditional advertising format; the defendant’s denial has no independent weight when denial is so beneficial for the legal characterization of its speech.)  The statements did refer to specific products and had an underlying economic motive.  But the fact that “books, newspapers, and magazines are published and sold for profit does not prevent them from being a form of expression whose liberty is safeguarded by the First Amendment.” Thus, the court didn’t give this last factor much weight.  Regardless, the commercial and noncommercial elements were inextricably intertwined.  “In short, the economic reality in this age of technology is that publishing companies and authors must promote the books they publish and write in order to sell them, if publishing houses are to continue to operate and books are to continue to be sold in paper and hard copies. As Plaintiffs themselves suggested at oral argument, it is nearly impossible to separate the promotional materials for the Books from the Books themselves.”  Thus, they too were noncommercial speech not covered by the UCL, FAL, and CLRA.

Fraud claims also failed.  The only statements specifically attributed to the publishers was that books were “biography” and “nonfiction,” and that Armstrong was the Tour de France “winner,” which was true even if the victory was later taken from him.  “Nonfiction” means based on true stories, not that every statement is true.  As Judge Kozinski wrote, “[s]peaking about oneself is precisely when people are most likely to exaggerate, obfuscate, embellish, omit key facts, or tell tall tales.”  The words “biography” and “nonfiction” aren’t “guarantees that the work contains only statements that are one hundred percent factual.”

As to the other individual non-Armstrong defendants, the plaintiffs didn’t plead reliance on their statements.

As for negligent misrepresentation, publishers “owe[ ] no duty to investigate the accuracy of the contents of the books it publishes,” given the risks of chilling First Amendment-protected speech. 

Plaintiffs were granted leave to amend, though, meaning that defendants weren’t entitled to attorneys’ fees and costs.

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