In a recent opinion, FilmOn.com v. Double Verify (2019) 246 Cal. Rptr. 3d 594, the California Supreme Court held context as well as content of speech is a relevant factor in evaluating whether the speech is entitled to protection by way of a special motion to strike under California Code of Civil Procedure § 425.16, commonly known as the anti-Strategic Lawsuit Against Public Policy statute (“SLAPP”).

Anti-SLAPP

The anti-SLAPP statute allows a defendant to bring a motion to strike a lawsuit if the claims arise from acts in furtherance of a person’s “right of petition or free speech under the United States Constitution or the California Constitution in connection with a public issue.  (§425.16(b)).   The statute is intended to protect against lawsuits filed for the purpose of chilling free speech so as to “encourage continued participation in matters of public significance.” (§425.16(a).  If successful, the lawsuit will be stricken and the defendant recovers attorney’s fees and costs associated with having to defend against the SLAPP.

The “Catch-All” Provision

In what is known as the “catch-all” provision, the statute specifies protected acts include “conduct in furtherance of the exercise of the constitutional right of petition or the constitutional right of free speech in connection with a public issue or an issue of public interest.”  (Id. at 426.16(e)(4).)  As the court notes in FilmOn, nowhere does the statute further define these terms. Thus, in anti-SLAPP cases, courts are called upon to interpret the disputed speech/conduct to determine if it falls within the protection of the statute.

Free Speech Issue addressed in Film-On

In FilmOn, the communication at issue involved statements made by defendant Double Verify, an internet website monitoring company, who gathers information about websites its clients are interested in advertising on and provides its clients with confidential reports, which include a description of the website’s content. For example, Double Verify may “tag” or classify a website as containing “Adult Content” or “Copyright Infringement.”  Such was the case with several websites owned by the plaintiff FilmOn who provides entertainment content on the web including television channels, premium movie channels, pay-per-view channels, and on-demand titles.

FilmOn sued Double Verify for trade libel, tortious interference with contract, tortious interference with prospective economic advantage and violation of California’s unfair competition law.
In its complaint, FilmOn alleged it incurred damages because ad partners and potential ad partners refused to advertise through websites on FilmOn’s network as a direct result of Double Verify’s “false and disparaging statements” published in its confidential reports.  FilmOn claimed its websites do not engage in copyright infringement and do not feature adult content.

In response to the Complaint, Double Verify brought a special motion to strike under the Anti-SLAPP statute.  The trial court granted the motion and the Court of Appeal affirmed.  The lower courts found Double Verify’s reports implicated the public’s interest in knowing the nature of available content on the internet. The Court of Appeal analogized Double Verify’s confidential reports to ratings by the Motion Picture Association of America by rating movies based on their level of adult content.  The lower courts in essence ignored the distinction between MMPA ratings which are public and the confidential Double Verify reports reasoning the identity of the speaker and the identity of the audience do not affect the sole issue of whether the content concerns an issue of public interest.

Analysis

The Supreme Court granted review to evaluate how the context of a statement including the speaker and the audience informs the determination of whether the statement was made in furtherance of free speech in connection with a public issue. The Supreme Court criticized the Court of Appeal for ignoring prior case law which held contextual cues such as speaker, audience, and the location where the statement was made. The Supreme Court also disagreed with Double Verify’s argument claiming the commercial context of a statement is irrelevant unless specifically exempted from the Anti-SLAPP statute by CCP § 425.17, which expressly exempts a subset of commercial speech involving comparative advertising.

The inquiry under the catchall provision is a two-part analysis.  First, what public issue is implicated by the content of the speech.  (FilmOn, supra, at 602).  Defendants like Double Verify are usually able to connect the speech/conduct to a matter of public interest. Here, Double Verify argued its reports concern topics of widespread public interest, namely the presence of adult content on the internet and the presence of copyright-infringing content on FilmOn’s websites.

The second part is more demanding and involves determining “what functional relationship exists between the speech and the public conversation about some matter of public interest.” (FilmOn, supra, at 602). It is in the second prong of the analysis where the Supreme Court finds the context of the statement is relevant. The Supreme Court finds there must be some nexus between the speech or conduct and the asserted public interest. In other words, the statement “must in some manner itself contribute to the public debate” through participation in or furthering the public discourse.  (Id. at 603).

Ultimately, the Supreme Court found Double Verify’s reports did not further public discourse on the issue of adult content and copyright infringement because the confidential reports generated for Double Verify’s paying clients, never entered the public realm and were not intended to. Thus, Double Verify did not issue its reports in furtherance of free speech in connection with an issue of public interest and it is not entitled to anti-SLAPP protection. The Supreme Court was careful to note its analysis was not based on the commercial speech exception to the Anti-SLAPP statute stating some commercially oriented speech could warrant anti-SLAPP protection.

Takeaway

The Supreme Court’s holding will likely lead to fewer anti-SLAPP motions being granted.  However, under the right circumstances an anti-SLAPP motion is still a powerful defense tool to dispose of a case early with recovery of defense litigation costs.  In evaluating whether an anti-SLAPP motion should be filed, the defense should carefully analyze not only the content of the speech/conduct but also the context, i.e., who made the statement, who was the intended audience, where was the statement made, to determine if the statement actually furthers the discourse on a matter of public concern.

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