Ctr. for Advanced Def. Studies v. Kaalbye Shipping Int'l

• Decision Date: 07 April 2015
• Docket Number: Civil Action No. 2014 CA 002273 B
• Parties: CENTER FOR ADVANCED DEFENSE STUDIES, Plaintiff, v. KAALBYE SHIPPING INTERNATIONAL, et al., Defendants.
• Court: D.C. Superior Court

CENTER FOR ADVANCED DEFENSE STUDIES, Plaintiff,
v.
KAALBYE SHIPPING INTERNATIONAL, et al., Defendants.

Civil Action No. 2014 CA 002273 B

SUPERIOR COURT OF THE DISTRICT OF COLUMBIA Civil Division

April 7, 2015

Judge Thomas J. Motley
Civ. II - Cal. 5

ORDER GRANTING PLAINTIFF/COUNTER-DEFENDANT'S SPECIAL MOTION TO DISMISS

I. Introduction

This case arises out of a report titled "The Odessa Network: Mapping Facilitators of Russian and Ukrainian Arms Transfers" ("Report"). Plaintiff/Counter-Defendant Center for Advanced Defense Studies ("C4ADS") claims that it published the Report, in the exercise of its First Amendment rights, to cast light on the transportation of Russian-made arms to conflict areas of the world, a topic of significant importance to the public. Defendant/Counter-Plaintiff Kaalbye Shipping International ("Kaalbye"), a Ukraine-based shipping company, has filed a defamation claim against C4ADS, contending that false statements and implications in the Report damaged its reputation. In the instant Special Motion to Dismiss, C4ADS requests that this Court dismiss Kaalbye's defamation claims because the claims are an attempt to chill C4ADS' First Amendment right of advocacy on issues of public interest. C4ADS argues that "[t]he threat of protracted and expensive litigation has a real potential for chilling journalistic criticism and comment on public figures and public affairs." Guilford Transp. Indus. v. Wilner, 760 A.2d 580, 592 (D.C. 2003) (internal quotation and citations omitted). After examining the law of the District of Columbia and conducting evidentiary hearings, this Court concludes that

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Kaalbye's claims for defamation must be dismissed because C4ADS' report furthers the right of advocacy on an issue of public concern and defendant has failed to demonstrate that it is likely to succeed on the merits of its defamation claims.

A. Factual Background

In September of 2013,¹ C4ADS published its eighty-two-page Report, focusing on the prevalence of Russian-made arms in certain conflict areas of the world, such as Syria. Report at 11. In its Report, C4ADS, a nonprofit research organization,² examines a network of shipping companies centered in Odessa, Ukraine, that may be responsible for transporting weapons to those conflict areas. Id. Although some arms shipments are visible to the public, the Report operates on the assumption that those publicly-known shipments represent only the "tip of the iceberg." Id. The stated goal of the Report is to "empower global policymakers" by providing better information about the rest of that iceberg. Id. To that end, the Report documents a number of arms shipments from Russian and Ukrainian ports to various parts of the world. See id. at 12-30. In doing so, C4ADS also seeks to explore the utility of "open-source data," such as ship-based transponder data recorded in publicly-available Automatic Information System ("AIS") logs. Id. at 11. The Report focuses on a group of shipping and logistics companies³ that it terms the "Odessa Network." Kaalbye is one of several organizations identified prominently in the Report.

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B. Procedural History

On April 10, 2014, C4ADS filed a complaint, amended May 12, 2014, seeking an anti-suit injunction against Kaalbye, which would enjoin Kaalbye from making any claims of defamation against C4ADS relating to the Report.⁴ In response to C4ADS' complaint, on June 4, 2014, Kaalbye filed its Answer with Counter Claim, setting out a claim for defamation against C4ADS for its publication of the Report.

On July 18, 2014, C4ADS filed a Special Motion to Dismiss, requesting dismissal of Kaalbye's counterclaim for defamation pursuant to the District of Columbia Anti-SLAPP Act of 2010 ("SLAPP Act"), D.C. Code § 16-5501, et seq. (2014). (The acronym "SLAPP" stands for "Strategic Lawsuit Against Public Policy.") On August 7, 2014, Kaalbye filed its Opposition, and on August 11, 2014, C4ADS filed its Reply. On August 26, September 2, October 1, and December 17, 2014, this Court heard oral arguments concerning the nature of this case, the proper interpretation of the SLAPP statute, and the necessity of an evidentiary hearing. Evidentiary hearings on the Special Motion to Dismiss were held on January 20, January 21, January 22, and February 9, 2015. On March 2, 2015, this Court heard oral arguments on issues raised at the evidentiary hearings.

In support of its Special Motion to Dismiss, C4ADS argues that Kaalbye cannot meet its burden under the SLAPP statute to show that its claim is likely to succeed on the merits, and therefore, Kaalbye's defamation claim should be dismissed. Specifically, C4ADS contends that Kaalbye is not likely to be able to show that the Report was published with "actual malice," a necessary element of a defamation claim made by a "public figure."

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In response, Kaalbye argues that the SLAPP statute only requires that a court test the sufficiency of the complaint under a Twombly/Iqbal standard.⁵ Kaalbye contends that, at most, a court should review the motion under a summary judgment standard, pursuant to Super. Ct. R. Civ. P. 56. Alternatively, even if the court reviews the motion under a standard similar to the one used to decide motions for preliminary injunction under Super. Ct. R. Civ. P. 65, Kaalbye contends that it is still likely to succeed on the merits of its claim, and the Special Motion to Dismiss should be denied. Kaalbye submits that it is not a public figure for purposes of its defamation claim and therefore has no burden to prove actual malice. In the alternative, Kaalbye argues that even if this Court determines that it is a public figure, it can demonstrate by clear and convincing evidence that C4ADS acted with actual malice when it published its Report.

For the reasons stated in open court,⁶ as well as the reasons stated herein, this Court concludes that (1) the SLAPP Act - once the moving party has shown that it is covered by the statute - requires the nonmoving party to demonstrate that its claim is likely to succeed on the merits after being provided an opportunity to present evidence to the court at an expedited hearing, (2) Kaalbye is a public figure for purposes of its defamation counterclaim and must prove malice by clear and convincing evidence; and (3) based on the evidence presented, Kaalbye is unlikely to succeed on the merits of its counterclaim. Therefore, this Court dismisses Kaalbye's counterclaim with prejudice.

II. The Anti-SLAPP Act of 2010

The DC Anti-SLAPP Act of 2010, D.C. Code § 16-5501, et seq. (2014), grants defendants engaged in protected actions immunity from suit; that is, it "explicitly protects the right not to stand trial." Doe No. 1 v. Burke, 91 A.3d 1031, 1039 (D.C. 2014); see also Farah v.

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Esquire Magazine, Inc., 863 F. Supp. 2d 29, 36 (D.D.C. 2012) ("The D.C. Anti-SLAPP Act intentionally follows the lead of other jurisdictions, which have similarly extended absolute or qualified immunity to individuals engaged in protected actions." (internal quotations and citation omitted)). The SLAPP Act's immunity is triggered by the filing of a special motion to dismiss "any claim arising from an act in furtherance of the right of advocacy on issues of public interest." D.C. Code § 16-5502(a). If the movant shows that the claim arises from such an act, "then the motion shall be granted unless the responding party demonstrates that the claim is likely to succeed on the merits." D.C. Code § 16-5502(b).

As an initial matter, the parties agree that the publication of the Report is an act in furtherance of the right of advocacy on issues of public interest.⁷ Thus, C4ADS has met the first requirement of obtaining relief under the SLAPP Act, shifting the burden to Kaalbye. The Special Motion to Dismiss must be granted unless Kaalbye demonstrates that its claims are likely to succeed on the merits.

The parties disagree, however, on the effect of the words "likely to succeed on the merits." Kaalbye urges this Court to follow the lead of California, whose courts interpret California's corresponding statute to require a claimant to "satisfy a standard comparable to that used on a motion for judgment as a matter of law." Price v. Stossel, 620 F.3d 992, 1000 (9th Cir. 2010). The California standard requires a claimant to "demonstrate that the complaint is legally sufficient and supported by a prima facie showing of facts to sustain a favorable judgment if the evidence submitted by the plaintiff is credited." Id. In support of its argument, Kaalbye relies on three trial court opinions in the District of Columbia that have adopted the California standard for use with special motions to dismiss under the D.C. Anti-SLAPP Act. See Boley v. Atl.

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Monthly Group, 950 F. Supp. 2d 249, 257 (D.D.C. 2013); Abbas v. Foreign Policy Group, LLC, 975 F. Supp. 2d 1, 13 (D.D.C. 2013); Mann v. Nat'l Rev., Inc., No. 12-CA-8263 B, 2013 D.C. Super. LEXIS 7 (D.C. Super. Ct. Jul. 19, 2013).

C4ADS argues that the statutory language requires courts to do more than determine whether the allegations in the plaintiff's complaint can support a prima facie case. The standard endorsed by C4ADS calls for courts to conduct an evidentiary hearing, which appears to be similar to a preliminary injunction hearing under Super. Ct. R. Civ. P. 65. In support of its position, C4ADS emphasizes the fact-intensive analysis undertaken by the Court of Appeals in Doe No. 1 v. Burke, 91 A.3d 1031, 1041 (D.C. 2014).

This Court finds C4ADS' argument more persuasive. First, the words "likelihood of success" as used in the SLAPP Act are clear. The statute places a burden on Kaalbye to prove a likelihood of success on the merits, not that its claims pass muster under the standards of Super. Ct. R. Civ. P. 12(b)(6) or Super. Ct. R. Civ. P. 56.

Even if this Court were to conclude that the statutory language is unclear, the rules of statutory construction support C4ADS' position. Where the legislature employs a term of...