Opinion
155513/2019
03-09-2021
David SACKLER, Plaintiff, v. AMERICAN BROADCASTING COMPANIES, INC., Home Box Office, Inc., NYP Holdings, Inc., Thomson Reuters d/b/a Reuters America LLC, Hearst Magazines a Division of Hearst Communications, Inc., Defendant.
For Plaintiff: Eric E. Rothstein, Rothstein Law PLLC For Defendant NYP Holdings: Steven G. Mintz and Terence McCormick, Mintz & Gold LLP
For Plaintiff: Eric E. Rothstein, Rothstein Law PLLC
For Defendant NYP Holdings: Steven G. Mintz and Terence McCormick, Mintz & Gold LLP
W. Franc Perry, J. Plaintiff David Sackler ("Plaintiff") brings this action for defamation per se/libel per se/slander per se against Defendants Hearst Magazines and NYP Holdings, Inc. (the "Post"), alleging that the Defendants, while reporting on Purdue Pharma's involvement in the OxyContin epidemic, mistakenly used photographs of Plaintiff instead of the David Sackler of the Sackler family, which owns Purdue Pharma. In motion sequence 002, the Post moves to dismiss the amended complaint, on the grounds that Plaintiff fails to allege that the Post acted with actual malice in publishing the photographs. The motion has been fully submitted and oral argument was held via remote conference on January 20, 2021.
Pursuant to stipulations, this action has been discontinued against Home Box Office, Inc. (NYSCEF Doc No. 12), American Broadcasting Companies, Inc. (NYSCEF Doc No. 21), and Thomson Reuters (NYSCEF Doc No. 53).
Background
This case arises from the Defendants’ collective reporting of the Sackler Family's involvement in the United States opioid epidemic through the company Purdue Pharma. Plaintiff David Sackler, who is not a member of the Sackler Family, is a consultant and professional in the health and wellness industry.
As relevant to this motion, Plaintiff alleges that when the Post published a story online about the Sackler family on May 12, 2019, it included a photograph of Plaintiff, rather than the David Sackler of Purdue Pharma. (NYSCEF Doc No. 6, Am. Complaint at ¶¶ 111-15.) Plaintiff notes that the online photograph is a picture of Plaintiff holding a bottle of Trimwater, which is a beverage distributed by Plaintiff's company, Lifestyle Beverages, Inc. (Id. at ¶ 116.) The story also ran in the printed version of the Post, featuring the same photograph but cropping the bottle of Trimwater out of frame. (Id. at ¶ 119.)
Plaintiff also alleges that the Post published a different photograph of him, again holding a bottle of Trimwater, in a May 15, 2019 online article, titled "MET to reject gifts from Sacklers amid fury over opioid crisis". (Id. at 126-130.) The printed version of this story did not feature a photograph. (Id. at ¶ 132.)
The Post moves to dismiss, arguing in its brief that under New York's choice of law principles, New Jersey's defamation law applies because Plaintiff is domiciled in New Jersey. (NYSCEF Doc No. 23 at 9.) The Post argues that under New Jersey law, Plaintiff would be required to plead facts supporting an inference of actual malice because the Post's articles related to a matter of a legitimate public concern, and that because Plaintiff has failed to do so, the amended complaint must be dismissed. In opposition, Plaintiff argues that New York law applies. (NYSCEF Doc No. 36 at 5-14.)
While the motion was sub judice , the New York Legislature adopted amendments to its "anti-SLAPP (strategic lawsuits against public participation)" law, codified at New York Civil Rights Law §§ 70-a, 76-a. The amendment to § 76-a broadened the definition of "an action involving public petition and participation" and imposed the requirement that a plaintiff "establish by clear and convincing evidence that any communication which gives rise to the action" was made with actual malice. The amendment to § 70-a gives defendants in such actions who are successful in their motions to dismiss or for summary judgment the right to bring a claim for costs and attorney's fees. In a December 29, 2020 memorandum order from the United States District Court for the Southern District of New York, the Hon. Judge Jed S. Rakoff ruled that the anti-SLAPP amendments applied retroactively.
Pursuant to Uniform Civil Rules Rule 202.8-c, the Post and Plaintiff both submitted letters informing the court of the amendments, as the amendments are relevant to this case. (NYSCEF Doc Nos. 46, 52.)
The Post maintains that Judge Rakoff's analysis is correct and the amendments do apply retroactively, thus resolving the choice of law dispute, as there is no conflict in the standard of proof for defamation between New Jersey and New York because both states now require a showing of actual malice. The Amendments
The amendment at issue in this case is as follows:
Enacted on the same day as § 76-a, Civil Rights Law § 70-a ("Actions involving public petition and participation; recovery of damages") discusses a defendant's ability to recover damages from a plaintiff in a defamation suit regarding a matter of public interest.
§ 76-a. Actions involving public petition and participation; when actual malice to be proven
1. For purposes of this section:
(a) An "action involving public petition and participation" is a claim based upon:
(1) any communication in a place open to the public or a public forum in connection with an issue of public interest; or
(2) any other lawful conduct in furtherance of the exercise of the constitutional right of free speech in connection with an issue of public interest, or in furtherance of the exercise of the constitutional right of petition.
(b) "Claim" includes any lawsuit, cause of action, cross-claim, counterclaim, or other judicial pleading or filing requesting relief.
(c) "Communication" shall mean any statement, claim, allegation in a proceeding, decision, protest, writing, argument, contention or other expression.
(d) "Public interest" shall be construed broadly, and shall mean any subject other than a purely private matter.
2. In an action involving public petition and participation, damages may only be recovered if the plaintiff, in addition to all other necessary elements, shall have established by clear and convincing evidence that any communication which gives rise to the action was made with
knowledge of its falsity or with reckless disregard of whether it was false, where the truth or falsity of such communication is material to the cause of action at issue.
3. Nothing in this section shall be construed to limit any constitutional, statutory or common law protections of defendants to actions involving public petition and participation.
In Sarah Palin v. The New York Times Company , 510 F.Supp.3d 21, [S.D.N.Y., 2020], Judge Rakoff held that the amendments applied retroactively. Palin is a case wherein the former Governor of Alaska and 2008 vice-presidential candidate sued the New York Times, alleging that they defamed her in a 2017 editorial regarding gun control. Prior to the amendments passing in November 2020, the parties were contesting whether the federal constitutional rule, which imposed an actual malice requirement, or New York law, which did not, governed the case. However, that issue was to be resolved after the New York Times moved for an order reflecting the change in law.
Judge Rakoff's holding that " § 76-a is a remedial statute that should be given retroactive effect" was based on several factors. He cited to the session law, which stated that the amendment "shall take effect immediately," and also cited to the justification offered by State Senator Brad Hoylman, the sponsor of the amendments, who stated:
Section 76-a of the Civil Rights Law was originally enacted by the Legislature to provide "the utmost protection for the free exercise or speech, petition, and association rights, particularly where such rights are exercised in a public forum with respect to issues of public concern." L. 1992 Ch. 767. However, as drafted, and as narrowly interpreted by the courts, the application of Section 76-a has failed to accomplish that objective. In practice, the current statute has been strictly limited to cases initiated by persons or business entities that are embroiled in controversies over a public application or permit, usually in a real estate development situation. By revising the definition of an "action involving public petition and participation," this amendment to Section 76-a will better advance the purposes that the Legislature originally identified in enacting New York's anti-SLAPP law. This is done by broadly widening the ambit of the law to include matters of "public interest", which is to be broadly construed, e.g. anything other than a "purely private matter."
( Palin , 510 F.Supp.3d at 26-27, citing AB 5991-A § 4; Sponsor Mem. of Sen. Hoylman [July 22, 2020], https://www.nysenate.gov/legislation/bills/2019/s52.) After the Palin decision, the Hon. Judge Eric N. Vitaliano of the Eastern District of New York issued a decision in Coleman v. Grand , ––– F.Supp.3d ––––, 2021 WL 768167 [E.D. N.Y., 2021] noting agreement with Judge Rakoff that the anti-SLAPP amendment applied retroactively. ( Coleman , ––– F.Supp.3d at ––––, 2021 WL 768167 at *8.)
This court finds that the anti-SLAPP amendments are intended to apply retroactively in order to effectuate the remedial and beneficial purpose of the statute. ( Matter of Gleason , 96 N.Y.2d 117, 122, 726 N.Y.S.2d 45, 749 N.E.2d 724 [2001].) Further, Plaintiff suffers no undue prejudice from retroactive application, as Plaintiff has attempted to couch his claim against the Post in terms of actual malice from the filing of the complaint (Am. Cmplt at ¶ 165; NYSCEF Doc No. 36 at ¶ 53) and had ample opportunity to argue the issue at oral argument.
Although Plaintiff is correct that Sarah Palin is a public figure (Trans. at 13, lns 5-18), nothing in the text of the amended statute indicates that the Legislature intended for the statute to only apply to defamation cases involving such public figures. The amendment defines an "action involving public ... participation" to be a claim based upon "any communication in a place open to the public or a public forum in connection with an issue of public interest" and further states that the term "’public interest’ shall be construed broadly, and shall mean any subject other than a purely private matter." ( NY Civil Rights Law §§ 76-a [1][a][1], [d].) Thus, by the text of the statute, Plaintiff's argument that he is "not the kind of person the SLAPP legislation is intended to impact" because "anti-SLAPP protects the little guy from being put upon by the big guy for taking part in the political process" is inaccurate. (Trans. at 12, lns 8-10; 13 lns 7-10.) Plaintiff's argument however, ignores the very purpose of the amendment which is to broaden the scope of actionable cases involving the public interest, in order to protect free speech "in a public forum with respect to issues of public concern." (Sponsor Mem. of Sen. Hoylman [July 22, 2020].)
Plaintiff's argument that Judge Rakoff's holding "did not change the standard already applicable in that case of actual malice" is irrelevant to this case. Palin dealt with a choice of law issue between federal law, which, in a prior decision, was held to impose an actual malice standard, and New York law, which the defendants argued also imposed an actual malice standard (for defamation cases involving public figures), although Judge Rakoff had declined to address that argument. After the amendment was passed, the defendants filed their motion for reconsideration, which the court granted, as a determination on the retroactivity of the amendment would be relevant in the event that plaintiff lost at trial and appealed the court's decision that federal law imposed an actual malice standard. ( Palin at 28.)
Here, a determination of the retroactivity issue eliminates the conflict between New York and New Jersey defamation law and thus would change the standard applicable to the action. As demonstrated in the parties’ submissions, New Jersey law requires a showing of actual malice, while New York law (formerly) did not. (See generally , NYSCEF Doc Nos. 23, 36.)
Lastly, Plaintiff's argument that the Legislature "could have said if it wanted to that it's retroactive" ignores Judge Rakoff's reasoning, who held that the Legislature did "say" the statute is intended to be retroactive. (Trans. at 13-14, lns. 25, 1.) Plaintiff's contention that the amendments do not apply to the issues before the court also sidesteps the role of the court in determining the retroactive effect of legislation when a definite statement is not included in the text of the statute. (See Matter of Gleason , 96 N.Y.2d at 122, 726 N.Y.S.2d 45, 749 N.E.2d 724.)
Having determined that the amendment is retroactive, the court will now turn to the issue of whether Plaintiff adequately pleads actual malice to withstand the motion to dismiss.
Motion to dismiss
On a pre-answer motion to dismiss a complaint for failure to state a cause of action, pursuant to CPLR 3211 [a] [7], "the court should accept as true the facts alleged in the complaint, accord plaintiff the benefit of every possible inference, and only determine whether the facts, as alleged, fit within any cognizable legal theory." ( Frank v. DaimlerChrysler Corp. , 292 A.D.2d 118, 121, 741 N.Y.S.2d 9 [1st Dept. 2002].) However, "factual allegations that do not state a viable cause of action, that consist of bare legal conclusions, or that are inherently incredible or clearly contradicted by documentary evidence are not entitled to such consideration." ( Skillgames, LLC v. Brody , 1 A.D.3d 247, 250, 767 N.Y.S.2d 418 [1st Dept. 2003].)
Additionally, CPLR 3211 [g] provides that in cases involving the public interest, as defined by Civil Rights Law § 76-a, where a defendant moves to dismiss pursuant to CPLR 3211 [a] [7], "the burden is upon the plaintiff to establish that its claim has the requisite substantial basis." ( Duane Reade, Inc. v. Clark , 2 Misc. 3d 1007(A), at *4, 2004 WL 690191 [Sup. Ct., N.Y. County 2004].) "In order to avoid dismissal of its SLAPP suit complaint, plaintiff must establish by clear and convincing evidence a ‘substantial basis’ in fact and law for its claim. The Legislature viewed ‘substantial’ as a more stringent standard than the ‘reasonable’ standard that would otherwise apply." ( Id. , quoting Siegel, Practice Commentaries, McKinney's Cons Laws of NY, Book 7B, CPLR C3211:73.)
As discussed above, Civil Rights Law § 76-a now states that, in any action regarding the public interest, "damages may only be recovered if the plaintiff, in addition to all other necessary elements, shall have established by clear and convincing evidence that any communication which gives rise to the action was made with knowledge of its falsity or with reckless disregard of whether it was false." (See also Sweeney v. Prisoners’ Legal Servs. of New York, Inc. , 84 N.Y.2d 786, 792, 622 N.Y.S.2d 896, 647 N.E.2d 101 [1995] [" ‘Actual malice’ means that defendants published the false information about plaintiff with knowledge that it was false or with reckless disregard of whether it was false or not."].)
Here, the court finds that Plaintiff fails to establish by clear and convincing evidence that the Post published the photograph of him with actual malice. Plaintiff's sole allegation is that the Post "did no research, insufficient research, or research that was not reasonably calculated to determine" if the David Sackler in the photographs was the David Sackler of Purdue Pharma. (Am. Cmplt. at ¶ 131.) However, it is well settled that a "failure to investigate will not alone support a finding of actual malice." ( Harte-Hanks Communications, Inc. v. Connaughton , 491 U.S. 657, 109 S.Ct. 2678, 105 L.Ed.2d 562 [1989] ; see also St. Amant v. Thompson , 390 U.S. 727, 731, 88 S.Ct. 1323, 20 L.Ed.2d 262 [1968] ["reckless conduct is not measured by whether a reasonably prudent man would have published, or would have investigated before publishing. There must be sufficient evidence to permit the conclusion that the defendant in fact entertained serious doubts as to the truth of his publication"]; Kipper v. NYP Holdings Co. , 12 N.Y.3d 348, 355, 884 N.Y.S.2d 194, 912 N.E.2d 26 [2009] [plaintiff's reliance on the Post's "failure to employ fact-checkers, to attempt to verify the status of his license prior to publication, or to identify those individuals responsible for the false headline and statement" was insufficient to establish actual malice by clear and convincing evidence]; Rivera v. Time Warner Inc. , 56 A.D.3d 298, 298, 867 N.Y.S.2d 405 [1st Dept. 2008] ["Actual malice cannot be inferred from factual allegations merely suggesting that Time Warner had reason to question the accuracy of the information at issue"].)
In opposition, Plaintiff contends that further discovery is needed for him to establish actual malice in this case. (NYSCEF Doc No. 36 at ¶¶ 51-55.) However, Plaintiff's contention ignores his burden of proof. Pursuant to CPLR 3211 [g], the court "shall" grant the motion to dismiss unless Plaintiff can establish that its claim has a "substantial basis in law." Contrary to plaintiff's contention, further discovery will not rectify Plaintiff's legally insufficient allegations, as a failure to adequately research whether the published photographs were of the "correct" David Sackler does not, as a matter of law, constitute actual malice.
Relatedly, Plaintiff's request to replead is denied. Repleading would be futile, as Plaintiff has failed to demonstrate a meritorious cause of action and has not shown that his claim has a substantial basis in law. Thus, the court "shall" grant the motion. ( CPLR § 3211 [g].) Accordingly, it is hereby
ORDERED that the motion of defendant NYP Holdings, Inc., motion sequence 002, to dismiss the amended complaint herein is granted and the amended complaint is dismissed in its entirety as against said defendant, with costs and disbursements to said defendant as taxed by the Clerk of the Court, and the Clerk is directed to enter judgment accordingly in favor of said defendant; and it is further
ORDERED that the action is severed and continued against the remaining defendant, Hearst Magazines; and it is further
ORDERED that the caption be amended to reflect the dismissal and that all future papers filed with the court bear the amended caption.