Monday, August 12, 2019

statements about guest's supposed misbehavior at fan convention aren't actionable under Lanham Act

Alexander v. Falk, 2019 WL 3717802, No. 16-cv-02268-MMD-GWF (D. Nev. Aug. 7, 2019)

Randi Alexander and Jackson Young sued a bunch of entities mostly for defamation and disparagement under federal and Nevada laws. “Alexander is an erotic romance novelist and Young is a romance novel cover model.” Defendant RT’s business is to promote romance and particularly promote/review romance books. “Falk is the owner of RT and publisher of RT’s magazine—which later dissolved—and is considered a pioneer of romantic fiction. Falk held a yearly convention tailored to both readers and writers in the romance novel industry,” which was over 35 years old.

The RT Convention held in 2016 in Las Vegas claimed “3,500 attendees, 200 seminars, countless parties, 700 authors signing books, and unforgettable evening extravaganzas in the spirit of Sin City,” at which Falk “looked forward to meeting people in her suite during the convention.”  The testimony was that defendant Wilson and Young had a confrontation at a bar during the convention; Wilson reported the incident and related matters to Falk and stated that she “didn’t feel safe.” Falk told some attendees that she had received complaints about Young and indicated that Young would not be invited back as a result. One witness testified that she suggested Falk talk to Alexander because Alexander was Young’s business partner and Falk stated “Well, from what I’ve heard, she probably wouldn’t care” and that she’d been told that Young and Alexander were more than business partners. “Young testified that he was told the conversations between Falk and Wills and Williams included claims of extortion and blackmail.”
Falk “testified about attendees—readers and writers—who came up to her complaining about Young, including about Young’s work”; she was unwilling to identify anyone but Wilson, and wasn’t sure about the total number. She also testified that she did not see or speak with Young at the RT Convention and that she didn’t receive any complaints about Alexander.  After Wilson talked with Falk, Wilson posted to Facebook, "asserting sexual harassment by [Young], [and] that he had threatened to ruin her career and had asked her to sign a deal to get royalties from her books.” 

Falk also sent a message to Young: “I advise you to not have anything to do with [third-party] and his event ... [B&N] says they will no longer cooperate with him again ... his conference last year was a disaster ... Bow out or you will get your name sullied.” But that was in May 2015—not in relation to the RT Convention.

In April 2017, in response to posts about Young, Falk posted to the Facebook group “Early Arrivals RT2017 Atlanta” that Young was banned from RT events. The first response in the thread came from a woman who stated: “A certain cover-model had been removed from the group due to multiple allegations of abuse and blackmail... I’m not letting him back in.”

Plaintiffs asserted claims under the Lanham Act and various disparagement-related claims.

The court sua sponte found that plaintiffs lacked Lanham Act standing against the RT defendants (which is a step beyond continuing to call it “standing” after Lexmark).  Citing pre-Lexmark precedent, the court reasoned that Lanham Act standing requires a plaintiff to show “(1) a commercial injury based upon misrepresentation about a product; and (2) that the injury is ‘competitive’ or harmful to the plaintiff’s ability to compete with the defendant.” “[W]hen [a] plaintiff competes directly with [the] defendant, a misrepresentation will give rise to a presumed commercial injury that is sufficient to establish standing.”

This is perfectly consistent with Lexmark, but the formulation omits the relevant “commercial activities” language of the Lanham Act—§43(a)(1)(B) isn’t just a product disparagement statute. And that leads the court into perhaps harmless error, given the evident problems with calling the accused statements commercial advertising or promotion (the only thing that even requires serious thought is the Facebook statement, which is plausibly commercial promotion but doesn’t have enough details to imply anything specific).  The court reasoned that there was no evidence “that connects those statements to any particular product.”  At least some of the challenged statements, though, should have been analyzed with relation to Young’s “commercial activities” and maybe even his “services” as a conference personality, though it's not clear to me he was paid for that. Nor was there direct competition between plaintiffs and the RT defendants; though plaintiffs alleged that Alexander was conducting a different romance writers’ and readers’ convention, that was in 2017 and 2018. They sued in 2016, so there was no competition at the time of the alleged misrepresentations.  Again, Lexmark doesn’t require competition, and, as that case indicates, disparagement is exactly the kind of thing that can harm a plaintiff who’s not in direct competition with a defendant.  This is really an “advertising or promotion” failure (and §230 prevents RT from being liable for a comment posted by someone else on Facebook, unless she was acting on RT’s behalf).

Nevada claims for consumer fraud/deceptive trade practices: Similarly, none of the accused statements disparaged plaintiffs’ “goods, services or business” as statutorily required.

Disparagement/trade libel/defamation: A reasonable juror could conclude that “Falk’s statements informing [others] of the complaints she received about Young likely lowered the view of Young so as to be defamatory.” But the testimony didn’t establish falsity: there was testimony that she did receive complaints, and no testimony that she didn’t.  Nor did insinuations that the plaintiffs were having an affair amount to defamation.  And the ban from RT events, and announcement of the ban, weren’t actionable. “The ban is not a statement, and the statement is not otherwise established as having been false.” Statements in the Facebook thread about the ban—made several months after this suit was filed—weren’t enough. And Falk’s “2015 advice to Young regarding his name being sullied cannot reasonably be considered defamatory—if at all relevant to this action.”

The business disparagement/trade libel claim failed against there RT defendants because there is no evidence that they made statements about the quality of any relevant products or services.

Nor could a reasonable juror infer malice by those defendants. Even if Falk didn’t investigate the complaints she testified to receiving, that wasn’t knowing falsity or reckless disregard for the truth. Falk testified that she “took [the complaints] to heart,” “suggesting she was not subjectively reckless or acted maliciously,” and she had no duty to investigate before responding in conversations where Young’s name was mentioned to her or before banning him from RT events.

False light claims failed for similar reasons. Tortious interference claims failed for want of proof of interference/intent. IIED and negligent infliction of emotional distress claims failed for want of sufficient medical evidence or objectively verifiable evidence of harm; seeking mental health treatment wasn’t enough.

The evidence also didn’t support a claim that the RT defendants engaged in civil conspiracy based on Wilson’s specific calling-out Facebook post.  The testimony indicated that they spoke; Falk only told Wilson to “do what you [want] to do” after Wilson told Falk “I don’t know what’s going on, but I’m going to have to do something because I’m literally being dragged through the mud.” Both parties’ testimony indicated that Falk attempted to warn Wilson regarding what Wilson wanted to do. No reasonable juror would infer tacit or explicit agreement to violate the law between Wilson and Falk.

Wilson received sua sponte summary judgment for her on the claims against her for intentional and negligent infliction of emotional distress, and civil conspiracy/concert of action because of the insufficiency of those claims.

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