Haverhill Stem LLC v. Jennings

• Citation: 99 Mass.App.Ct. 626,172 N.E.3d 410
• Decision Date: 26 May 2021
• Docket Number: No. 20-P-537,20-P-537
• Parties: HAVERHILL STEM LLC & another v. Lloyd JENNINGS & another.
• Court: Appeals Court of Massachusetts

99 Mass.App.Ct. 626

172 N.E.3d 410

HAVERHILL STEM LLC & another¹

v.Lloyd JENNINGS & another.²

No. 20-P-537

Appeals Court of Massachusetts, Essex.

Argued January 15, 2021.

Decided May 26, 2021.

Alvin S. Nathanson, Boston, (Scott Adam Schlager also present) for the defendants.

Thomas K. MacMillan, Bradford, for the plaintiffs.

Present: Green, C.J., Kinder, & Englander, JJ.

ENGLANDER, J.

This case presents issues regarding the types of claims that can survive challenge under the so-called "anti-SLAPP statute," G. L. c. 231, § 59H. The plaintiffs, Caroline Pineau and Haverhill Stem LLC (collectively Pineau or plaintiffs), sought to operate a marijuana dispensary at a property that Pineau leased in downtown Haverhill. The defendants, Brad Brooks and Lloyd Jennings, own the property next door to Pineau, and opposed the dispensary, including Pineau's efforts to obtain necessary zoning relief. The plaintiff's complaint alleges that Brooks and Jennings coerced and threatened Pineau, in an effort to extort money from her in return for the defendants’ agreement to withdraw their opposition to the proposed dispensary.

The complaint accordingly alleges claims, among other things, for violations of G. L. c. 93A and the Massachusetts Civil Rights Act, see G. L. c. 12, § 11I, as well as for defamation. The defendants moved to dismiss under the anti-SLAPP statute, G. L. c. 231, § 59H, arguing that the plaintiff's claims were based upon the defendants’ lawful, constitutionally protected petitioning activity. The motion was denied, and the defendants appeal. We affirm.

Background. We recite the well-pleaded facts from the complaint, supplemented in part by facts identified by the judge as a result of the process employed to decide a motion to dismiss under the anti-SLAPP statute.³

As is one of the paradigms in anti-SLAPP cases, the plaintiff was seeking something from the government here, and the defendants opposed same. As of 2018 Pineau was seeking to establish a marijuana dispensary in Haverhill's downtown, and was advocating for zoning ordinance changes that would allow such establishments in that district. In October of 2018, Pineau's father purchased the building at 124 Washington Street, the eventual site of her marijuana business. Pineau thereafter contacted her neighbors, including defendant Brooks. The defendants Brooks and Jennings own the property at 128-130 Washington Street, where they lease out several residential units as well as space for a restaurant, in which Jennings has a financial interest.

According to the complaint, Brooks and Jennings objected to the proposed use of 124 Washington as a marijuana dispensary, unless Pineau first paid them $30,000. The defendants’ position was based in a dispute that predated Pineau's lease of the building at 124 Washington. The defendants had been at odds with the prior owner, when the defendants had sought to build a deck behind their own building at 128 Washington. The prior owner raised concerns that the defendants’ proposed deck extended onto his property; that dispute was resolved by the defendants paying $30,000 to also build a deck behind 124 Washington. As a result, in the defendants’ view "the building," now leased by Pineau, owed the defendants $30,000, and absent a payment the defendants "would fight whatever Pineau proposes for use of the building."

Accordingly, the defendants actively opposed the effort to allow marijuana establishments to operate in the downtown waterfront district. When Pineau first contacted Brooks regarding her plans in October of 2018, Brooks responded: "[W]ell, you better bet me and my partner are going to get our money back from the deck we built, which is $30,000, and make sure you go through the same hell with the city that we did." The parties met several times thereafter, with Brooks and Jennings reiterating their demand for money. The complaint repeatedly characterizes the way the defendants went about their opposition as "threats" and "coercion." The characterizations by themselves are not sufficient to avoid dismissal, of course; because anti-SLAPP law must account for the defendants’ fundamental rights of speech and petitioning, we must go beyond the labels in the complaint, and examine what the defendants allegedly said and did.

Although Haverhill approved the zoning ordinance allowing marijuana establishments in January of 2019, the parties’ dispute continued throughout the first several months of 2019, as did the negotiations. Jennings reportedly told people "around town" that Pineau "doesn't know who she is dealing with" and would "see how Haverhill works."⁴ The parties met again in March of 2019, with the defendants demanding $30,000, the use of the deck at Pineau's building, and "that no cannabis commerce take place on the second or third floor" of Pineau's building. The defendants also threatened to bring a "RICO"⁵ lawsuit against Pineau. In subsequent negotiations the defendants raised their price to $50,000, and then to $75,000.

Then, on April 10, 2019, the defendants met with Pineau's husband. During that meeting Jennings became angry. He reiterated the threat of a RICO lawsuit and stated that he was "prepared to try and destroy the Pineaus and their business before it got off the ground." He then went on to say that "the Pineaus don't have the money to fight him and he has already won and was prepared to take everything from the Pineaus, including their house." Further negotiations were unsuccessful. On May 30, 2019, the defendants and another business owner filed a suit in the Land Court against the plaintiff and others, seeking to invalidate the recreational marijuana zoning bylaw on several grounds. On June 5, the day after being served with the complaint in the Land Court action, Pineau filed this lawsuit in Superior Court. Pineau's complaint states six counts, including claims for violation of G. L. c. 93A, violation of the Massachusetts Civil Rights Act, see G. L. c. 12, § 11I, and defamation. The defendants moved to dismiss under the anti-SLAPP statute, contending that the suit was based on their protected right to petition the government. They also moved to dismiss under Mass. R. Civ. P. 12 (b) (6), 365 Mass. 754 (1974), for failure to state a claim. As part of litigating the anti-SLAPP motion, the parties agreed to depositions, and Pineau, Brooks, and Jennings were each deposed.

The Superior Court judge denied the anti-SLAPP motion. Most saliently, he concluded that the defendants had failed to show that Pineau's claims were "based solely on [the defendants’] exercise of the constitutional right to petition" -- the threshold element of anti-SLAPP analysis under the decisions of the Supreme Judicial Court. See 477 Harrison Ave., LLC v. JACE Boston, LLC, 477 Mass. 162, 167-168, 74 N.E.3d 1237 (2017), S.C., 483 Mass. 514, 134 N.E.3d 91 (2019) ( 477 Harrison ); Blanchard v. Steward Carney Hosp., Inc., 477 Mass. 141, 147-148, 75 N.E.3d 21 (2017), S.C., 483 Mass. 200, 130 N.E.3d 1242 (2019) ( Blanchard I ). The judge noted that Pineau's claims were based on more than that the defendants had objected to the marijuana dispensary, and more than that the defendants had demanded money to drop their objection; rather, the plaintiff had "allege[d], not implausibly, that the defendants engaged in a pressure campaign to coerce Pineau to pay them," which had included threats "both [to] Pineau's business project and her family's financial wellbeing." The judge also went on to deny most of the defendants’ rule 12 (b) (6) motion.^{6 ,7}

The defendants appealed from the order denying their anti-SLAPP motion to dismiss, invoking the doctrine of present execution. The defendants also moved for reconsideration, this time pressing an argument that the plaintiff's claims were barred by the litigation privilege. The judge rejected the litigation privilege argument as well, and denied the motion for reconsideration. On the appeal before us, the defendants raise arguments based on the anti-SLAPP statute, the litigation privilege, and their rule 12 (b) (6) motion.⁸

Discussion. 1. The anti-SLAPP motion to dismiss. The anti-SLAPP statute provides a mechanism for early dismissal of civil claims, where those claims are "based solely on [a defendant's] exercise of the right of petition" to the government. 477 Harrison, 477 Mass. at 168, 74 N.E.3d 1237. The Supreme Judicial Court has construed the statute several times, and has provided a framework, which has evolved over time, for analyzing whether an anti-SLAPP motion to dismiss should be allowed. See, e.g., Blanchard v. Steward Carney Hosp., Inc., 483 Mass. 200, 130 N.E.3d 1242 (2019) ( Blanchard II ); 477 Harrison, 477 Mass. 162, 74 N.E.3d 1237 ; Blanchard I, 477 Mass. 141, 75 N.E.3d 21 ; Duracraft Corp. v. Holmes Prods. Corp., 427 Mass. 156, 691 N.E.2d 935 (1998). The court has admonished that an anti-SLAPP motion must be evaluated in light of the statute's fundamental purpose, which is to identify and cut off those claims that are "without merit primarily brought to chill legitimate petitioning activities." Blanchard I, supra at 155, 75 N.E.3d 21. To that end, a defendant seeking dismissal must show, at the threshold, that the claims against it "are based solely on [its] exercise of its [constitutional] right to petition" (emphasis added). Id. at 147, 75 N.E.3d 21. The defendants’ motion founders on this threshold requirement.

The standard of review of a denial of an anti-SLAPP motion to dismiss for failure to meet the threshold element is de novo. See Reichenbach v. Haydock, 92 Mass. App. Ct. 567, 572, 90 N.E.3d 791 (2017). In resolving whether the plaintiff's claims here are based solely on the defendants’ petitioning activity, we find the Supreme Judicial Court's decision in Blanchard I particularly instructive. In this case, as in Blanchard I, some of the plaintiff's allegations are based on protected petitioning activity, but other significant allegations are not.

In Blanchard I, 477...