Finke v. Walt Disney Co.

• Decision Date: 28 July 2003
• Docket Number: No. B160267.,B160267.
• Citation: 2 Cal.Rptr.3d 436,110 Cal.App.4th 1210
• Court: California Court of Appeals Court of Appeals
• Parties: Nikki FINKE, Plaintiff and Respondent, v. The WALT DISNEY COMPANY et al., Defendants and Appellants.

2 Cal.Rptr.3d 436

110 Cal.App.4th 1210

Nikki FINKE, Plaintiff and Respondent, v. The WALT DISNEY COMPANY et al., Defendants and Appellants.

No. B160267.

Court of Appeal, Second District, Division 7.

July 28, 2003.

As Modified July 31, 2003.

Review Granted November 12, 2003.

Christensen, Miller, Fink, Jacobs, Glasser, Weil & Shapiro, Patricia L. Glasser, Ronald E. Guttman and Craig H. Marcus, Los Angeles, for Defendant and Appellant The Walt Disney Company.

O'Donnell & Shaeffer, Pierce O'Donnell, Carolee E. Handler, Clyde M. Hettrick, Los Angeles, and Daniel H. Rylaarsdam for Plaintiff and Respondent.

JOHNSON, Acting P.J.

California's SLAPP statute provides in relevant part a court may strike "[a] cause of action against a person arising from any act of that person in furtherance of the person's right of petition or free speech under the United States or California Constitution in connection with a public issue[.]"¹ The principal question in this appeal is whether a defendant moving to strike a cause of action under the SLAPP statute must show all of the acts alleged to give rise to a cause of action were in furtherance of the defendant's First Amendment rights in connection with a public issue or whether it is enough to show at least one of such acts meets these criteria.

We reaffirm our conclusion in Fox Searchlight Pictures, Inc. v. Paladino "a plaintiff cannot frustrate the purposes of the SLAPP statute through a pleading tactic of combining allegations of protected and nonprotected activity under the label of one `cause of action.'"² Therefore we hold the trial court erred in ruling the SLAPP statute does not apply to the present case. We further hold, however, the plaintiff has demonstrated a reasonable probability of prevailing on the merits of all but two of her causes of action. Therefore we will reverse the trial court's order denying the motion to strike and remand the cause to the trial court with directions to grant the motion as to certain causes of action and deny it as to the remainder.

FACTS AND PROCEEDINGS BELOW

The case before us is an offshoot of the long-running litigation between the Walt Disney Company and a literary agency over merchandising rights to the Winnie— the-Pooh characters—honey allegedly worth billions.³

In the course of the Pooh litigation the plaintiff moved for sanctions against Disney for destroying approximately 40 boxes of records which, according to the plaintiff, contained admissible evidence or could have led to the discovery of admissible evidence in support of its claims. The trial court found in destroying the records Disney "engaged in a misuse of the discovery process" and acted in "bad faith." The court imposed evidentiary sanctions on Disney and ordered it to pay plaintiffs reasonable attorney fees and costs in bringing the motion in the sum of $90,000.

The plaintiff in the case before us, Nikki Finke, is a newspaper reporter who had a contract with the New York Post to write stories about the entertainment industry for the Post's business section. Finke's editor assigned her the story about the sanction orders in the Pooh litigation. He also assigned her a companion article on the efforts of the plaintiff in the Pooh litigation to revoke Disney's license to sell Winnie-the-Pooh merchandise. Both articles appeared in the same edition of the Post.

According to Finke's complaint, the day after her Pooh articles appeared Disney officials commenced a campaign of letters and telephone calls to the Post's editors and upper management complaining Finke was biased against Disney and her articles contained factual inaccuracies. Approximately two weeks after it published the Pooh articles the Post fired Finke. Finke's editor told her she was being fired because of the Pooh articles.

Finke offered evidence to show that after the Post fired Finke, Disney's spokesperson told a reporter for the Village Voice there were "serious factual errors" in Finke's stories. The Village Voice article also quoted Daniel Petrocelli, the attorney representing Disney in the Pooh litigation, as stating portions of Finke's reporting were "recklessly inaccurate," "critical parts of the articles were false," and Finke's presentation was "one-sided and biased."

Finke filed this action against Disney alleging interference with contract and prospective business advantage, libel and slander, infliction of emotional distress and unfair business practices. Disney responded with a motion to strike these causes of action under section 425.16, the SLAPP statute. Disney contended its statements to the Post were speech in connection with two issues of public interest —the Pooh litigation and the accuracy of news reporting—and therefore entitled to protection under the SLAPP statute. It also contended Finke had no reasonable probability of prevailing on her claims. Finke conceded the Pooh litigation was a matter of public interest but argued Disney's statements were not made in connection with the Pooh litigation. Rather, they were a personal attack on her intended to further Disney's bottom line, not its right to free speech. Finke further argued even if the SLAPP statute applied to her action, she had a reasonable probability of success on the merits of her claims.

The trial court denied Disney's motion. The court concluded Disney could not invoke SLAPP protection in this case because it could not show all the acts giving rise to Finke's causes of action were done in furtherance of Disney's right to free speech. The court did not reach the question whether Finke had a reasonable probability of success on any of her causes of action.

Disney filed a timely appeal from the denial of its motion.⁴

DISCUSSION

I. A DEFENDANT MAY MOVE TO STRIKE A CAUSE OF ACTION UNDER THE SLAPP STATUTE IF AT LEAST ONE OF THE PREDICATE ACTS WAS AN ACT IN FURTHERANCE OF THE DEFENDANT'S FIRST AMENDMENT RIGHTS IN CONNECTION WITH A PUBLIC ISSUE OR AN ISSUE IN A JUDICIAL PROCEEDING.

In the discussion which follows we bear in mind two essential characteristics of SLAPP motions, neither of which are in dispute. First, a SLAPP motion involves a two-pronged analysis. The defendant must show the challenged cause of action arises out of acts in furtherance of the defendant's right of petition or free speech in connection with a public issue. If the defendant satisfies this requirement the burden shifts to the plaintiff to establish a probability of success on the merits.⁵ Furthermore, a SLAPP motion addresses a cause of action, not the individual allegations or theories supporting the cause of action. Therefore, neither the plaintiff nor the court can resolve a SLAPP motion by simply amending the complaint or striking out the offending allegations.⁶

In the present case, after correctly ruling a SLAPP motion may be directed to an individual cause of action,⁷ the trial court posed this question: "[W]hen a single cause of action is based on multiple acts, some of which fall within the scope of section 425.16 and some of which do not, is that cause of action subject to a special motion to strike?" The court answered this question in the negative. It ruled a SLAPP motion will not lie unless the defendant can show all of the acts on which a cause of action is predicated were in furtherance of the defendant's First Amendment rights in connection with a public issue. The trial court erred.

In Fox Searchlight we addressed the question posed by the trial court in the present case. There an employer sued a former employee for disclosing confidential information to the attorneys representing her in a wrongful termination action and for refusing to return the confidential material. The employee moved to strike the employer's complaint as a SLAPP suit. The employer argued, inter alia, the employee's refusal to return the allegedly confidential material was not an act in furtherance of her right of petition or free speech. Because each cause of action in the employer's complaint included an allegation of such wrongful conduct the employer maintained each cause of action was immune from a motion to strike under the SLAPP statute.⁸ We rejected the employer's argument for two separate and independently sufficient reasons. We stated we could not determine from the record before us that "as a matter of law maintenance of this material was not an act in furtherance of the employee's First Amendment right to petition.⁹ We further stated even if the retention of the confidential material was not an act protected under section 425.16, "a plaintiff cannot frustrate the purposes of the SLAPP statute through a pleading tactic of combining allegations of protected and nonprotected activity under the label of one `cause of action.'"¹⁰

Our holding in Fox Searchlight was followed in Kids Against Pollution.¹¹ In that case the plaintiffs alleged the California Dental Association (CDA) was violating California's unfair competition law by engaging in conduct intended to prevent dental patients from receiving accurate information on the dangers of mercury amalgam fillings. The plaintiffs' second and third causes of action alleged the CDA was enforcing an ethics opinion which held the removal of mercury amalgam fillings from non-allergic patients "solely at the recommendation of the dentist is improper and unethical." The fourth and fifth causes of action incorporated the allegations in the second and third and further alleged the CDA was distributing brochures and other public statements which deceived the public about the health effects of dental amalgam.¹² The trial court denied the CDA's SLAPP motion. The court agreed the plaintiffs' causes of action arose out of the CDA's acts in furtherance of its right to free speech but found the plaintiffs were likely to prevail on the merits of their claims. The Court of Appeal agreed with the trial court's ruling the anti-SLAPP statute applied to the fourth and fifth causes of action even though the acts...