While we wait for the DC Circuit to resolve whether the DC anti-SLAPP statute applies in federal court (either in Sherrod v. Breitbart or Farah v. Esquire), two judges on the Ninth Circuit have suggested that court should revisit its prior decisions on whether the California anti-SLAPP act applies in federal court.
The surprising statements came in last week’s opinion in Makaeff v. Trump University. In that lawsuit, Ms. Makaeff brought a putative class action against Trump University, alleging that it engaged in deceptive business practices. Trump University filed a counterclaim against Ms. Makaeff for defamation. She moved to dismiss that counterclaim under California’s anti-SLAPP statute. The federal district court held that the challenged statements arose from protected conduct under the statute, but that Trump University had demonstrated a reasonable probability of prevailing on the merits, thus defeating the anti-SLAPP motion.
Ms. Makaeff took an interlocutory appeal to the Ninth Circuit. In an opinion written by Judge Wardlaw, that court agreed that the challenged statements arose from protected conduct. It disagreed with the district court, however, on whether Trump has a reasonable probability of success on the merits because it held that: (a) Trump University was limited public figure; and (b) must thus show that the challenged statements were made with actual malice. It remanded the case to the district court to “address the inherently fact-intensive question of whether Trump University has a reasonable probability of proving, by clear and convincing evidence, that Makaeff made her critical statements with actual malice.”
Chief Judge Kozinski and Judge Paez concurred in the majority opinion because it was faithful to Ninth Circuit precedent, but wrote separately to express their opinions that the court’s prior decisions, holding that anti-SLAPP statutes could be applied in federal court, should be revisited.
According to Chief Judge Kozinski, the main problem with the court’s prior decision holding that the California anti-SLAPP statute could be applied in federal court was its conclusion that the act was substantive. According to Chief Judge Kozinski:
It’s not. The anti-SLAPP statute creates no substantive rights; it merely provides a procedural mechanism for vindicating existing rights. The language of the statute is procedural: Its mainspring is a “special motion to strike”; it contains provisions limiting discovery; it provides for sanctions for parties who bring a non-meritorious suit or motion; the court’s ruling on the potential success of plaintiff’s claim is not “admissible in evidence at any later stage of the case”; and an order granting or denying the special motion is immediately appealable.
Because state rules of procedure have no effect in federal court, according to Chief Judge Kozinski, “this is the beginning and the end of the analysis. Having determined that the state rule is quintessentially procedural, I would conclude it has no application in federal court.”
But he then went further. Defendants in the DC anti-SLAPP cases have argued (here or here) that the anti-SLAPP statute can be applied in federal court because it can co-exist with the Federal Rules of Civil Procedure. Chief Judge Kozinski disagreed with this reasoning, stating that it “vastly understates the disruption when federal courts apply the California anti-SLAPP statute.” He writes that, while the Federal Rules of Civil Procedure provide a “logical order and pace” to cases, “[t]he California anti-SLAPP statute cuts an ugly gash through this orderly process” by allowing an early test of the complaint, reversing the applicable standards, authorizing the award of attorneys fees, and providing a right to interlocutory appeal.
In conclusion, Chief Judge Kozinski noted that the panel was required to follow circuit precedent, but, “if this case or another case were taken en banc, we could take a fresh look at the question. I believe we should.”
Judge Paez wrote separately to echo the points made by Chief Judge Kozinski – “I agree that California anti-SLAPP statute is ‘quintessentially procedural’ and its application in federal court has created a hybrid mess that now resembles neither the Federal Rules nor the original state statute” – and to emphasize the confusion caused by various state anti-SLAPP acts on whether there is a right to immediate appeal.
I suspect that Trump University will accept Chief Judge Kozinski’s invitation and move for en banc review. Stay tuned.