MEMO TO:
Alexsei Demo US
RESEARCH ID:
#40007201d8d074
JURISDICTION:
State
STATE/FORUM:
California, United States of America
ANSWERED ON:
May 12, 2022
CLASSIFICATION:
Torts

Issue:

In what circumstances can a public figure establish malice in a claim of defamation by implication?

Facts:

Yellow Herd, a famous actress who had recently gone through a very acrimonious public divorce from her ex-husband, Donny Jepp, an even more famous actor with a much longer career and larger fan base than Herd, published an op-ed in the Hollywood Chronicle identifying herself as a victim of domestic violence. The op-ed did not mention Jepp by name but it was well known that Herd had obtained a restraining order against him during their separation and divorce. After the op-ed was published, Jepp lost a contract to star in the sixth installment of a very popular pirate movie franchise from which he was set to earn several million dollars. He lost favor in Hollywood and has been cast in very few roles since. Jepp brought a defamation action against Herd. As a public figure, he will have to establish malice in order to make out a claim of defamation. I would like to know whether any California courts have found malice in a case where the plaintiff was not specifically mentioned by name in the allegedly defamatory statements.

Conclusion:

In implied defamation cases, where a statement reasonably implies false and defamatory facts regarding public figures or officials, those plaintiffs must show that such statements were made with actual malice. Actual malice exists where the defendants made the alleged defamatory statements with knowledge of their false implications or with reckless disregard for the truth. (Manzari v. Associated Newspapers Ltd., 830 F.3d 881 (9th Cir. 2016))

To be reckless, there must be sufficient evidence to permit the conclusion that the defendant in fact entertained serious doubts as to the truth of their publication.  (Manzari v. Associated Newspapers Ltd., 830 F.3d 881 (9th Cir. 2016), Reader's Digest Assn. v. Superior Court, 208 Cal.Rptr. 137, 37 Cal.3d 244, 690 P.2d 610 (Cal. 1984))

Actual malice can be proved by circumstantial evidence, including evidence of the defendant's hostility. Such evidence is relevant only to the extent that it reflects on the subjective attitude of the publisher. (Reader's Digest Assn. v. Superior Court, 208 Cal.Rptr. 137, 37 Cal.3d 244, 690 P.2d 610 (Cal. 1984), Balla v. Hall, 59 Cal.App.5th 652, 273 Cal.Rptr.3d 695 (Cal. App. 2021))

An otherwise defamatory statement is actionable only if it is "of and concerning" the plaintiff. To satisfy this requirement, the plaintiff must show that the statement expressly mentions them or refers to them by reasonable implication. The plaintiff must also show the statement was understood by at least one third person to have concerned them, but is not required that they do so by direct evidence. (Dickinson v. Cosby, 37 Cal.App.5th 1138, 250 Cal.Rptr.3d 350 (Cal. App. 2019))

To determine if the alleged defamatory statements are of and concerning the plaintiffs, courts consider the totality of the circumstances which requires an examination of the nature and full content of the communication and the knowledge and understanding of the audience to whom the publication was directed. (Dickinson v. Cosby, 37 Cal.App.5th 1138, 250 Cal.Rptr.3d 350 (Cal. App. 2019))

No California decisions were identified in which the Court held that a public figure plaintiff established malice in a claim of defamation by implication.

In Manzari v. Associated Newspapers Ltd., 830 F.3d 881 (9th Cir. 2016), the United States Court of Appeals for the Ninth Circuit held that the plaintiff raised sufficient factual questions for a jury to conclude that the defendant acted with reckless disregard for the defamatory implication in its article to withstand the defendant's motion for dismissal under the anti-SLAPP statute. In this case, there was evidence that the defendant's employees actively removed key contextual information from a photograph of the plaintiff and replaced this information with a caption about a performer testing positive for HIV. The publishers also failed to include any explanation or disclaimer adjacent to the photograph that would have informed readers that the plaintiff was not the subject of the article.

In Dickinson v. Cosby, 37 Cal.App.5th 1138, 250 Cal.Rptr.3d 350 (Cal. App. 2019), the California Court of Appeal for the Second District found that a reasonable trier of fact could conclude the allegedly defamatory statements contained in two press releases referred to the plaintiff, a public figure, by reasonable implication; thus, the plaintiff's claims survived the defendant's anti-SLAPP motion. The Court explained that the statements could be reasonably interpreted as referring specifically to the women who recently publicly accused the defendant, William ("Bill") Cosby, of sexual misconduct, and implying that their accusations were false. The plaintiff fit that description as she had accused Cosby of drugging and raping her on national television just two days before the press release was issued. Additionally, a similar press release was previously issued which explicitly called her "story" a "fabricated lie." 

Law:

In Manzari v. Associated Newspapers Ltd., 830 F.3d 881 (9th Cir. 2016), the United States Court of Appeals for the Ninth Circuit explained that in implied defamation cases, where a statement reasonably implies false and defamatory facts regarding public figures or officials, those plaintiffs must show that such statements were made with actual malice. Actual malice exists where the defendants made the alleged defamatory statements with knowledge of their false implications or with reckless disregard for the truth. To be reckless, there must be sufficient evidence to permit the conclusion that the defendant in fact entertained serious doubts as to the truth of their publication (at 891-892):

The Supreme Court has provided a framework through which we assess whether a public figure can move forward with a defamation claim. In Masson, the Court explained that “actual malice” presents a question of fact: “The constitutional question we must consider here is whether, in the framework of a summary judgment motion, the evidence suffices to show that respondents acted with the requisite knowledge of falsity or reckless disregard as to truth or falsity.” 501 U.S. at 513, 111 S.Ct. 2419. The Court concluded that “[t]he record contains substantial ... evidence, ... which, in a light most favorable to petitioner, would support a jury determination under a clear and convincing standard that [the author acted] deliberately or recklessly.” Id. at 521, 111 S.Ct. 2419. Although the author “contests petitioner's allegations, ... only a trial on the merits will resolve the factual dispute.... [A]t this stage, the evidence creates a jury question whether [the author] published the statements with knowledge or reckless disregard of the alterations.” Id.

In implied defamation cases, “where a statement ... reasonably implies false and defamatory facts regarding public figures or officials, those individuals must show that such statements were made with knowledge of their false implications or with reckless disregard of their truth.” Milkovich v. Lorain Journal Co., 497 U.S. 1, 20, 110 S.Ct. 2695, 111 L.Ed.2d 1 (1990). “[R]eckless conduct is not measured by whether a reasonably prudent man would have published, or would have investigated before publishing. There must be sufficient evidence to permit the conclusion that the defendant in fact entertained serious doubts as to the truth of his publication.” Time, Inc. v. Pape, 401 U.S. 279, 291–92, 91 S.Ct. 633, 28 L.Ed.2d 45 (1971). This standard ensures that publishers are not held liable for unintentional misstatements or implications, which public figures later claim are defamatory. See Howard v. Antilla, 294 F.3d 244, 252 (1st Cir. 2002) (“[I]mplications perceived in a statement but not intended by the speaker cannot be actionable in public official or public figure cases.”) (quoting Robert D. Sack, Libel, Slander, and Related Problems § 5.5.1, at 5–64 (3d ed. 1999)).3

[830 F.3d 892]

Defamation by implication against public figures is an area of law “fraught with subtle complexities.” White, 909 F.2d at 518. We have not always charted a clear path when applying the actual malice test to implied defamatory content. Compare Hoffman v. Capital Cities/ABC, Inc., 255 F.3d 1180, 1187 (9th Cir. 2001) (“evidence must clearly and convincingly demonstrate that [the publisher] knew (or purposefully avoided knowing) that the photograph would mislead its readers”), with Newton v. Nat'l Broad. Co. , 930 F.2d 662, 680–81 (9th Cir. 1990) (holding that failure to foresee the possible implications of a statement does not give rise to liability against a public figure, rather the relevant inquiry is one of subjective intent) andDodds v. Am. Broad. Co., 145 F.3d 1053, 1063–64 (9th Cir. 1998) (“In order to prevail on his claim that ABC's direct statements impliedly defamed him ... [the plaintiff] must show ... that ABC intended to convey the defamatory impression.” (internal quotation marks and citations omitted)). Although our cases have referenced actual malice with some variation in language, at its core our precedent mirrors the Supreme Court's requirements: knowledge of falsity or reckless disregard for the truth.

The Court held that the plaintiff raised sufficient factual questions for a jury to conclude that the defendant acted with reckless disregard for the defamatory implication in its article to withstand the defendant's motion for dismissal under the anti-SLAPP statute. The plaintiff's evidence was sufficient to support her claim that the defendant placed her photograph in the article, juxtaposed with the incendiary headline and caption, in reckless disregard of whether its words would be interpreted by the average reader as a false statement of fact; namely, that the plaintiff tested positive for HIV. The Court noted that while it is not enough that the defamatory implication should have been foreseen by the defendant when it juxtaposed the different elements of the article, or that an ordinary viewer would have perceived the implication, in this case, there was evidence that the defendant's employees actively removed key contextual information from the photograph and replaced this information with a caption about a performer testing positive for HIV. The publishers also failed to include any explanation or disclaimer adjacent to the photograph that would have informed readers that the plaintiff was not the subject of the article (at 892-893):

This case rests on the “reckless disregard” prong of actual malice. Recognizing that California law requires only “minimal merit” to withstand initial dismissal under the anti-SLAPP statute, we hold that Manzari has raised sufficient factual questions for a jury to conclude that the Daily Mail Online acted with reckless disregard for the defamatory implication in its article on the Los Angeles porn industry shut-down. Manzari's evidence is sufficient to support her claim that the Daily Mail Online placed her photograph in the article, juxtaposed with the incendiary headline and caption, “[knowing or acting] in reckless disregard of whether its words would be interpreted by the average reader as a false statement of fact.” Solano, 292 F.3d at 1084 (internal citations, alterations, and quotation marks omitted).

The undisputed message that the article is about Manzari—apparent from the headline, photograph, and caption—supports the conclusion that the Daily Mail Online acted with reckless disregard. Though it is not enough that the defamatory implication “should have been foreseen” by the Daily Mail when it juxtaposed the different elements of the article, see Newton, 930 F.2d at 680, or that an “ordinary viewer would have perceived the implication,” Dodds, 145 F.3d at 1064, here there is evidence that Daily Mail employees actively removed key contextual information from the “Danni Ashe” photograph as it was presented in the Corbis database, which stated: “Soft porn actress Danni Ashe, founder of Danni.com, poses in front of a video camera connected to the Internet in one of her studios in Los Angeles in 2000.” Instead, they replaced this information with the caption: “Moratorium: The porn industry in California was shocked on Wednesday by the announcement that a performer had tested HIV positive.” The publishers also failed to include any explanation or disclaimer adjacent to the “Danni” photograph, which would have informed readers that she was not the subject of the article. See Eastwood v. National Enquirer, Inc., 123 F.3d 1249, 1253, 1256 (9th Cir. 1997) (observing that “[a]s we have yet to see a defendant who admits to entertaining serious subjective doubt about the authenticity of an article it published, we must be guided by circumstantial evidence,” and concluding that the “totality of the [editors'] choices” supported a finding of actual malice).

It is no surprise that the Daily Mail employees deny that they understood or intended to make any implication about Manzari. While a finding that the publisher's testimony lacks credibility cannot on

[830 F.3d 893]

its own sustain a finding of subjective intent, Newton, 930 F.2d at 680, the denial must be read in the context of other evidence. If all a publisher needed to do was to deny the allegation, all implied defamation suits would be dead on arrival. If, for instance, a newspaper ran the headline: “High Profile Figure Accused of Murder” alongside a photograph of the Mayor of New York, or “Industry Shocked that Grocery Sprayed Veggies with Pesticide” alongside an image of a nationally-known grocery chain, the publishers would be hard-pressed to plausibly claim that they had simply selected a “stock” photograph. The same holds true for a story about the pornography industry, featuring a picture of a world-famous pornographic actress with her name written in neon lights behind her.4 This sort of willful blindness cannot immunize publishers where they act with reckless disregard for the truth or falsity of the implication they are making. Manzari meets the “minimal merit” threshold to avoid outright dismissal of her complaint.

No California decisions were identified in which a court held that a public figure plaintiff established malice in a claim of defamation by implication; however, a discussion of actual malice and defamation by implication claims may be instructive.

In Dickinson v. Cosby, 37 Cal.App.5th 1138, 250 Cal.Rptr.3d 350 (Cal. App. 2019), the California Court of Appeal for the Second District explained that an otherwise defamatory statement is actionable only if it is "of and concerning" the plaintiff. To satisfy this requirement, the plaintiff must show that the statement expressly mentions them or refers to them by reasonable implication. Additionally, the plaintiff must show that the statement was understood by at least one third person to have concerned them. To determine if the alleged defamatory statements are of and concerning the plaintiff, courts consider the totality of the circumstances which requires an examination of the nature and full content of the communication and the knowledge and understanding of the audience to whom the publication was directed (at 1160): 

An otherwise defamatory statement is actionable only if it is "of and concerning" the plaintiff. "The ‘of and concerning’ or specific reference requirement limits the right of action for injurious falsehood, granting it to those who are the direct object of criticism and denying it to those who merely complain of nonspecific statements that they believe cause them some hurt." (Blatty v. New York Times Co. (1986) 42 Cal.3d 1033, 1044, 232 Cal.Rptr. 542, 728 P.2d 1177 (Blatty).) To satisfy the requirement, the plaintiff must show the statement expressly mentions her or refers to her by reasonable implication. (Id. at p. 1046, 232 Cal.Rptr. 542, 728 P.2d 1177.) The plaintiff must also show the statement was understood by at least one third person to have concerned her. (Bartholomew v. YouTube, LLC (2017) 17 Cal.App.5th 1217, 1231, 225 Cal.Rptr.3d 917; see Neary v. Regents of University of California (1986) 185 Cal.App.3d 1136, 1147, 230 Cal.Rptr. 281 ["For publication to occur the defamatory matter must be communicated to a third party who understands the defamatory meaning and its applicability to the plaintiff."].)

A statement may be actionable if it refers to a group to which the plaintiff belongs, but only if the group is sufficiently small and its members easily ascertainable. (Blatty, supra, 42 Cal.3d at p. 1046, 232 Cal.Rptr. 542, 728 P.2d 1177.) Where the statement refers to a large group—typically

[250 Cal.Rptr.3d 368]

any group numbering more than 25 members—courts consistently hold that plaintiffs cannot show the statements were of and concerning them. (Ibid.)

To determine whether the allegedly defamatory statements are of and concerning Dickinson, we must consider the totality of the circumstances. (See D.A.R.E. America v. Rolling Stone Magazinesupra, 101 F.Supp.2d at p. 1290 [applying California law].) This requires examination of the "nature and full content of the communication and ... the knowledge and understanding of the audience to whom the publication was directed." (Baker v. Los Angeles Herald Examiner (1986) 42 Cal.3d 254, 261, 228 Cal.Rptr. 206, 721 P.2d 87 (Baker).)

The Court found that a reasonable trier of fact could conclude the allegedly defamatory statements contained in two press releases referred to the plaintiff, Janice Dickinson, by reasonable implication; thus, Dickinson's claims survived the defendant's anti-SLAPP motion. The Court explained that the statements could be reasonably interpreted as referring specifically to the women who had recently publicly accused the defendant, William ("Bill") Cosby, of sexual misconduct, and implying that their accusations were false. Dickinson fit that description as she had accused Cosby of drugging and raping her on national television just two days before the press release was issued. Additionally, a similar press release was previously issued which explicitly called Dickinson's "story" a "fabricated lie." The Court noted that the record did not disclose the precise number of women who had recently accused Cosby of sexual misconduct, but the Court did not think the group was necessarily so large that its members could not be readily ascertained, particularly given the public nature of the women's disclosures and the significant attention they received (at 1160-1162): 

Dickinson's claims premised on the November 20 and 21 press releases are considerably weaker than her claims premised on the demand letter and

[37 Cal.App.5th 1161]

November 19 press release, which referred to her directly. In fact, it is not clear why she chose to add the claims to her FAC, especially given the relative strength of her existing claims. Nonetheless, and although far from a certainty, we think a reasonable trier of fact could conclude the allegedly defamatory statements contained in each refers to Dickinson by reasonable implication.

The first allegedly defamatory statement—"Ms. Traitz is the latest example of people coming out of the woodwork with fabricated or unsubstantiated stories about my client"—appears in the November 20 press release. Singer issued the press release in the immediate wake of numerous women publicly accusing Cosby of sexual misconduct, which was a topic of considerable public interest. The press release itself was concerned primarily with discrediting one such woman's recent allegation that Cosby offered her drugs and made sexual advances on her decades ago. In this context, it is reasonable to read the reference to "stories about my client" to refer specifically to accusations of Cosby's sexual misconduct. Further, the phrase "coming out of the woodwork" suggests the accusers had not previously made their disclosures public. Thus, the statement could be reasonably interpreted as referring specifically to the women who recently publicly accused Cosby of sexual misconduct, and implying that their accusations were false.

Dickinson undoubtedly fits that description, a point even Singer acknowledged during his deposition. Just two days before Singer issued the November 20 press release, she went on national television to accuse Cosby of drugging and raping her. The next day, Singer issued the November 19 press release, which explicitly called Dickinson's "story" that Cosby raped her a "fabricated lie." Given this timeline of events, the significant publicity surrounding Dickinson's allegations and Cosby's response, and the similarities in language with the November 19 press release, we think a reasonable fact finder could conclude that Dickinson was one of the earlier "example[s] of people coming out of the woodwork" with "fabricated" "stories about [Cosby]" to which the November 20 statement implicitly referred.

For the same reasons, we think a reasonable trier of fact could conclude the allegedly defamatory statement in the November 21 press release—"The new, never-before-heard claims from women who have come forward in the past two weeks with unsubstantiated, fantastical stories about things they say occurred 30, 40, or even 50 years ago have escalated far past the point of absurdity"—is also of and concerning Dickinson. Indeed, the statement includes additional details that further

[250 Cal.Rptr.3d 369]

delineate the group and point even more directly to Dickinson.

[37 Cal.App.5th 1162]

We acknowledge that the record does not disclose the precise number of women who had recently accused Cosby of sexual misconduct.8 Still, we do not think the group is necessarily so large, or its boundaries so amorphous, that its members could not be readily ascertained. This is particularly true given the public nature of the women's disclosures and the significant attention they received. The bar to survive an anti-SLAPP motion is low, and we think Dickinson has met it here.

The Court also rejected Cosby's contention that Dickinson failed to produce any evidence showing that a third party actually understood that the allegedly defamatory statements referred to her. While a plaintiff must show that the alleged defamatory statement was understood by at least one third person to have concerned them, it is not required that they do so by direct evidence. In this case, the allegedly defamatory statements referred to Dickinson by reasonable implication, the press releases in which they appeared were widely disseminated, the topic of Cosby's alleged sexual misconduct was of considerable public interest, and Dickinson, who is herself a well-known public figure, had just days earlier accused Cosby of sexual misconduct during a nationally televised interview. Thus, for the purposes of an anti-SLAPP motion, the Court found that Dickinson provided sufficient circumstantial evidence to show that at least one third party heard the allegedly defamatory statements and actually understood them to refer to Dickinson (at 1162-1163): 

We are not persuaded by Cosby's contention that Dickinson failed to produce any evidence showing a third party actually understood the allegedly defamatory statements to refer to her. In support of his argument, Cosby relies on a Ninth Circuit case applying California law, in which the plaintiffs alleged the defendant made defamatory statements referring to their business. (SDV/ACCI, Inc. v. AT&T Corp. (9th Cir. 2008) 522 F.3d 955.) The Ninth Circuit affirmed summary judgment against the plaintiffs on the basis that they failed to produce evidence showing a third party actually understood the statements to refer to them as individuals. The court explained that under California law, "[t]o proceed with their suit as individuals, the [plaintiffs] must show not only that the statement could reasonably be understood as referring to them as individuals, but also that some third party understood the statement in this way." (Id. at p. 959, citing De Witt v. Wright (1881) 57 Cal. 576, 578 ["it is essential not only that it should have been written concerning the plaintiff, but also that it was so understood by at least some one third person"].)

Cosby contends that Dickinson likewise failed to produce any evidence showing a third party actually understood the allegedly defamatory statements to refer to her. He overlooks, however, that such evidence need not be direct. Indeed, the SDV/ACCI court specifically noted it was not "impugn[ing] the common law rule that circumstantial evidence may be used to prove that defamatory material was published to a third party who reasonably understood it to refer to the plaintiffs," and a plaintiff need not present testimony from a third party regarding what that person heard and understood. (SDV/ACCI, supra , 522 F.3d at p. 961.) Here, the allegedly defamatory statements referred to Dickinson by reasonable implication, the press releases in which they appeared were widely disseminated, the topic of Cosby's alleged sexual misconduct was of considerable public interest, and Dickinson, who is herself a well-known public figure, had just days earlier accused Cosby of sexual misconduct during a nationally televised interview. For

[37 Cal.App.5th 1163]

purposes of an anti-SLAPP motion, we think this is sufficient circumstantial evidence to show at least one third party heard the allegedly defamatory statements and actually understood them to refer to Dickinson.

In this case, the statements in the press releases were made by Cosby's lawyer. The Court did not reach the issue of the lawyer's liability in this decision because, in an apparent bid to avoid discovery on the issue of malice, Cosby chose not to pursue the argument in his first anti-SLAPP motion and thus he could not raise it in his second anti-SLAPP motion (at 1154):

Cosby also perfunctorily argues that we should reconsider his challenge to Dickinson's claims now that Singer has been "absolved" of liability. Once again, we are not persuaded. Cosby was free to argue in his first anti-SLAPP motion that Dickinson could not establish Singer's liability. In fact, he did make that argument, but ultimately abandoned it in an apparent bid to avoid discovery on the malice issue. Cosby chose not to pursue that argument in his first anti-SLAPP motion. He must live with that choice now.

In Reader's Digest Assn. v. Superior Court, 208 Cal.Rptr. 137, 37 Cal.3d 244, 690 P.2d 610 (Cal. 1984), the Supreme Court of California explained that the test to determine whether a defendant acted with reckless disregard for the truth or falsity of their publication is a subjective test. The defendant's actual belief concerning the truthfulness of the publication is the crucial issue. However, a defendant cannot automatically ensure a favorable verdict by testifying that they published with a belief that the statements were true, instead the finder of fact must determine whether the publication was made in good faith when considering the facts of the case. As an example, the Court noted that professions of good faith would be unlikely to be persuasive where the facts showed that the story was fabricated by the defendant. The Court explained that actual malice can be proven by circumstantial evidence. Such evidence is relevant only to the extent that it reflects on the subjective attitude of the publisher. The publisher's anger and hostility toward the plaintiff may be a factor that tends to indicate that the publisher had serious doubts regarding the truth of their publication; however, this fact on its own may be insufficient to prove actual malice. In this case, the Court found no triable issue as to actual malice as there was no direct evidence that the publishers believed the questioned passages in the article were false, or even entertained serious doubts respecting their truth (at 256-259):

As we noted earlier, the New York Times decision superimposed a constitutional standard on the common law of libel. If the person defamed is a public figure, he cannot recover unless he proves, by clear and convincing evidence (see New York Times Co. v. Sullivan, supra, 376 U.S. 254, 285-286, 84 S.Ct. 710, 728-729, 11 L.Ed.2d 686), that the libelous statement was made with " 'actual malice'--that is, with knowledge that it was false or with reckless disregard of whether it was false or not." (Pp. 279-280, 84 S.Ct. at pp. 725-726.) That decision did not define the phrase "reckless disregard," and its use of the term--"actual malice"--which had a different meaning in the common law of libel, engendered some confusion.

Four years later, in St. Amant v. Thompson, supra, 390 U.S. 727, 88 S.Ct. 1323, 20 L.Ed.2d 262, the high court sought to clarify the constitutional standard. First, it explained, "reckless conduct is not measured by whether a reasonably prudent man would have published, or would have investigated before publishing. There

Page 145

[690 P.2d 618] must be sufficient evidence to permit the conclusion that the defendant in fact entertained serious doubts as to the truth of his publication. Publishing [37 Cal.3d 257] with such doubts shows reckless disregard for truth or falsity and demonstrates actual malice." (P. 731, 88 S.Ct. at p. 1325.) 8

The quoted language establishes a subjective test, under which the defendant's actual belief concerning the truthfulness of the publication is the crucial issue. (See Alioto v. Cowles Communications, Inc. (N.D.Cal.1977) 430 F.Supp. 1363, 1365-1366.) This test directs attention to the "defendant's attitude toward the truth or falsity of the material published ... [not] the defendant's attitude toward the plaintiff." (Widener v. Pacific Gas & Electric Co. (1977) 75 Cal.App.3d 415, 434, 142 Cal.Rptr. 304.)

Although the ultimate issue is thus the good faith of the publisher, the court explained that a defendant cannot "automatically insure a favorable verdict by testifying that he published with a belief that the statements were true. The finder of fact must determine whether the publication was indeed made in good faith. Professions of good faith will be unlikely to prove persuasive, for example, where a story is fabricated by the defendant, is the product of his imagination, or is based wholly on an unverified anonymous telephone call. Nor will they be likely to prevail when the publisher's allegations are so inherently improbable that only a reckless man would have put them in circulation. Likewise, recklessness may be found where there are obvious reasons to doubt the veracity of the informant or the accuracy of his reports." (St. Amant v. Thompson, supra, 390 U.S. 727, 732, 88 S.Ct. 1323, 1326, 20 L.Ed.2d 262, fn. omitted.)

As St. Amant 's examples suggest, actual malice can be proved by circumstantial evidence. "[E]vidence of negligence, of motive and of intent may be adduced for the purpose of establishing, by cumulation and by appropriate inferences, the fact of a defendant's recklessness or of his knowledge of falsity." (Goldwater v. Ginzburg (2d Cir.1969) 414 F.2d 324, 342; Widener v. Pacific Gas & Electric Co., supra, 75 Cal.App.3d 415, [37 Cal.3d 258] 434, 142 Cal.Rptr. 304.) A failure to investigate 9 (see Widener v. Pacific Gas & Electric Co., supra, 75 Cal.App.3d 415, 434, 142 Cal.Rptr. 304), anger and hostility toward the plaintiff (id., at p. 436, 142 Cal.Rptr. 304), reliance upon sources known to be unreliable

Page 146

[690 P.2d 619] (Curtis Publishing Co. v. Butts, supra, 388 U.S. 130, 156, 87 S.Ct. 1975, 1992, 18 L.Ed.2d 1094; Pep v. Newsweek, Inc. (S.D.N.Y.1983) 553 F.Supp. 1000, 1002), or known to be biased against the plaintiff (Fisher v. Larsen (1982) 138 Cal.App.3d 627, 640, 188 Cal.Rptr. 216; Burns v. McGraw-Hill Broadcasting Co., Inc. (Colo.1983) 659 P.2d 1351, 1361-1362)--such factors may, in an appropriate case, indicate that the publisher himself had serious doubts regarding the truth of his publication.

We emphasize that such evidence is relevant only to the extent that it reflects on the subjective attitude of the publisher. (St. Amant v. Thompson, supra, 390 U.S. 727, 732-733, 88 S.Ct. 1323, 1326, 20 L.Ed.2d 262; Pep v. Newsweek, Inc., supra, 553 F.Supp. 1000, 1003; Velle Transcendental Research Ass'n v. Sanders (C.D.Cal.1981) 518 F.Supp. 512, 518-519.) The failure to conduct a thorough and objective investigation, standing alone, does not prove actual malice, nor even necessarily raise a triable issue of fact on that controversy. (See St. Amant v. Thompson, supra, 390 U.S. 727, 733, 88 S.Ct. 1323, 1326, 20 L.Ed.2d 262; Beckley Newspapers v. Hanks (1967) 389 U.S. 81, 84-85, 88 S.Ct. 197, 199-200, 19 L.Ed.2d 248.) Similarly, mere proof of ill will on the part of the publisher may likewise be insufficient. (Gomes v. Fried (1982) 136 Cal.App.3d 924, 934-935, 186 Cal.Rptr. 605.)

Upon examining the record before us, we find no triable issue as to actual malice. There is no direct evidence that MacDonald or other Reader's Digest personnel believed the questioned passages in the article were false, or even entertained serious doubts respecting their truth. Reader's Digest relied primarily upon the writings and conversations with Professor Ofshe and the Mitchells. Dr. Ofshe is a professor of sociology at a leading university and the author of a number of studies on Synanon; the Mitchells received the Pulitzer Prize for their reports and editorials on Synanon. Plaintiffs questioned the objectivity of these sources, and the extent of their [37 Cal.3d 259] knowledge of Synanon, but do not question that Reader's Digest considered them to be persons of unsullied reputation. 10

In Balla v. Hall, 59 Cal.App.5th 652, 273 Cal.Rptr.3d 695 (Cal. App. 2021), the California Court of Appeal for the Fourth District explained that to prove actual malice there must be sufficient evidence to permit the conclusion that the defendant in fact entertained serious doubts as to the truth of the publication. The evidence must be clear and convincing. On the facts of the case, the Court agreed with the trial court that the plaintiffs provided sufficient proof from which a trier of fact could find that the defendants acted with actual malice. The plaintiffs presented evidence that the defendant was motivated by hostility and this hostility reflected that the defendant lacked regard for the truth. Additionally, the record reflected that the defendant disregarded reliable sources and appeared to rely on unreliable ones (at 682-685):

Hall contends that plaintiffs failed to provide clear and convincing evidence of actual malice. The record is to the contrary.

To prove actual malice, a plaintiff must show that statements were made with " ‘knowledge that [they were] false or with reckless disregard of

[59 Cal.App.5th 683]

whether [they were] false or not.’ " (Reader's Digest, supra, 37 Cal.3d at pp. 256-257, 208 Cal.Rptr. 137, 690 P.2d 610.) " ‘There must be sufficient evidence to permit the conclusion that the defendant in fact entertained serious doubts as to the truth,’ " and the evidence must be clear and convincing. (Id. at pp. 252, 256, 208 Cal.Rptr. 137, 690 P.2d 610 ; see Copp, supra, 45 Cal.App.4th at p. 846, 52 Cal.Rptr.2d 831 ["burden of proof by clear and convincing evidence ‘requires a finding of high probability’; must ‘leave no substantial doubt’ "].)

"[A]ctual malice can be proved by circumstantial evidence." (Reader's Digest, supra, 37 Cal.3d at p. 257, 208 Cal.Rptr. 137, 690 P.2d 610.) Considerations such as "anger and hostility toward the plaintiff," "reliance upon sources known to be unreliable [citations] or known to be biased against the plaintiff," and "failure to investigate" may, "in an appropriate case, indicate that the publisher himself had serious doubts regarding the truth of his publication." (Id. at p. 258, 208 Cal.Rptr. 137, 690 P.2d 610.) Such evidence is relevant "to the extent that it reflects on the subjective attitude of the publisher," and failure to investigate, without more, generally is insufficient. (Ibid.)

We agree with the trial court that plaintiffs provided sufficient proof from which a trier of fact, applying the clear and convincing evidence standard, could find that defendants acted with actual malice.

First, the text messages provide compelling evidence that Hall was motivated by hostility and lacked regard for the truth of his publications. (Reader's Digest, supra, 37 Cal.3d at p. 257, 208 Cal.Rptr. 137, 690 P.2d 610.) Like the trial court, we find especially telling Hall's message after Heebner's comments at the Democratic Committee meeting that they "need[ed] a Lisa [sic ] retaliation." His sending of the "All Roads" e-mail after Siegel expressed an interest in Balla and suggested Harbaugh for a hit piece, and Siegel's later messages about "polishing [Hall's] inspired narrative," similarly support a vengeance motive. There is other evidence of animosity too. For example, Hall confirmed at deposition that he wanted Dieden to get the deal, and admitted he assisted in Tkachenko's claims against the Harbaugh estate and an Attorney General letter regarding Balla. And Siegel, for whom Hall was working, testified at deposition that he was hurt by Heebner and felt marginalized by her friends.14

[273 Cal.Rptr.3d 723]

Hall argues actual malice is not satisfied through ill will alone. And it is certainly true that actual malice in this context requires "reckless

[59 Cal.App.5th 684]

disregard for the truth," and not "merely ... ill will or ‘malice’ in the ordinary sense of the term." (Harte-Hanks Communications, Inc. v. Connaughton (1989) 491 U.S. 657, 667, 109 S.Ct. 2678, 105 L.Ed.2d 562 (Harte-Hanks).) But hostility is relevant if it reflects on the publisher's attitude toward the truth of the statements (Reader's Digest, supra , 37 Cal.3d at p. 257, 208 Cal.Rptr. 137, 690 P.2d 610), and it does so here.

Second, the record reflects that Hall disregarded reliable sources and appeared to rely on unreliable ones. (Reader's Digest, supra, 37 Cal.3d at p. 257, 208 Cal.Rptr. 137, 690 P.2d 610.) He did not seem to take seriously the clarifying communications from NCTD officials Tucker and Elmer after the October 28 e-mail, the October 29 "All Roads" e-mail, or the November 13 e-mail explaining that the Board had not selected a developer. Instead, Hall accused Tucker of being "part of the problem." He and Siegel would later seek information from Tkachenko, whom he knew did not like Balla and felt Harbaugh owed her something, and he apparently believed her close friend Dodge's report that the probate judge told them to report Balla to the Attorney General.

Third, Hall's use of the fictional Jones would support a finding of actual malice. We are not persuaded by his claim that he used Jones to express political opinions, for which he cites the "respected tradition of anonymity" in political causes. (McIntyre v. Ohio Elections Comm'n (1995) 514 U.S. 334, 343, 115 S.Ct. 1511, 131 L.Ed.2d 426 ). His publications go well beyond opinion, as we have already discussed. And he did not simply use an alias, but rather created an identity, with a Facebook page, stock photo, and a wife. One could conclude he was trying to convey that the publications were from a real person unafraid to use his name—allowing him to persuasively, but safely, disseminate known or potential falsehoods. (Compare Summit Bank v. Rogers (2012) 206 Cal.App.4th 669, 696-697, 142 Cal.Rptr.3d 40 [that most electronic bulletin board users stayed anonymous was "cue to discount their statements"].) Further, he does not explain why he used the fictional wife Rearden to write to the NCTD, casting further doubt on his claim that he was just trying to hide his identity. The tradition of anonymity does not aid him. (See McIntyre , at pp. 336, 342-343, 357, 115 S.Ct. 1511 [law prohibiting anonymous political literature was unconstitutional; citing pseudonyms in Federalist Papers and stating anonymity permits publication without prejudgment, persecution, or retaliation].)

Finally, any investigation by Hall was inadequate, and with the other evidence provides further proof of actual malice. We reject his claim that the evidence necessarily shows he did "vigorous[ ] research[ ]" and "vehemently believed" his publications." (See Reader's Digest, supra, 37 Cal.3d at p. 257, 208 Cal.Rptr. 137, 690 P.2d 610 ["[p]rofessions of good faith" not persuasive where story is fabricated].) Even if it were true that Hall no longer had prepublication research because he

[59 Cal.App.5th 685]

gave it to law enforcement, he fails to identify relevant post-litigation evidence to support his central claim. For example, he

[273 Cal.Rptr.3d 724]

cites "public documents" as grounds for his purported belief that Heebner and Nichols wanted the Harbaugh Trails donation, and gave Balla the ENA in exchange. The ENA was not authorized until June 2017 and they had no role in doing so; Hall does not identify any documents that could support such a belief in fall 2016. (See Burrill v. Nair (2013) 217 Cal.App.4th 357, 393, 158 Cal.Rptr.3d 332 (Burrill), distinguished on other grounds in Baral [defendant cited "no source" for claim plaintiff "fabricated domestic violence allegations" and took "money to influence her child custody recommendations"; he "simply says so" and jury could conclude charges were "product of his imagination"].) Further, Siegel admitted at deposition he had no evidence of a backdoor deal (suggesting Hall never had any either). Finally, Hall gave deposition testimony calling into question his investigation into other statements as well, such as his admission that the RFP specifically identified a landscape designer other than Nichols.15

Hall contends that failure to investigate is insufficient for actual malice. We agree that the "failure to conduct a thorough and objective investigation, standing alone" is not enough. (Reader's Digest, supra, 37 Cal.3d at p. 258, 208 Cal.Rptr. 137, 690 P.2d 610.) But the evidence here goes well beyond mere lack of investigation, and includes Hall's disregard of contradictory input from Tucker and Elmer. (See Harte-Hanks, supra, 491 U.S. at p. 692, 109 S.Ct. 2678 ["purposeful avoidance of the truth" distinguishable from failure to investigate; newspaper failed to interview key witness who might have confirmed statement was false]; Khawar v. Globe Internat., Inc. (1998) 19 Cal.4th 254, 276, 79 Cal.Rptr.2d 178, 965 P.2d 696 [accord]; Antonovich v. Superior Court (1991) 234 Cal.App.3d 1041, 1048-1051, 285 Cal.Rptr. 863 [actual malice shown where official failed to investigate statement that predecessor destroyed office files; evidence showed he had information about them being left].) The cases that Hall cites involve defendants who, unlike him, had at least some evidence to support their central claims. (See Beilenson, supra, 44 Cal.App.4th at pp. 947, 951-952, 52 Cal.Rptr.2d 357 [actual malice not shown for campaign mailer alleging candidate was unethical for having law practice while employed by state where, among other things, there was conflicting evidence as to whether quoted witness authorized statement]; Christian Research, supra, 148 Cal.App.4th at pp. 77, 85, 55 Cal.Rptr.3d 600 [employee's claim that institute was focus of federal investigation, based on supposed report from post office employee, insufficient for actual malice; there was no direct evidence employee fabricated report and no "obvious reason[ ]" to doubt it].)

In Edward v. Ellis, 72 Cal.App.5th 780, 287 Cal.Rptr.3d 467 (Cal. App. 2021), the California Court of Appeal for the Fourth District found that the plaintiff established a probability that he could produce clear and convincing evidence that the allegedly defamatory statements were made with knowledge of their falsity and thus his claim survived the defendant's anti-SLAPP motion. The defendant argued that he never intended to convey the defamatory message alleged by the plaintiff and thus he could not have made the statement with actual malice. The Court found that the record raised credibility questions about the defendant's professions of innocence, including the defendant's deposition testimony in which the defendant stated that he could not recall what he had in mind when he used the phrase at issue and admitted that he had actual knowledge that the implied statement was false (at 793-794):

Ellis next asserts Edward's libel claim should be dismissed because Edward did not establish a probability of producing clear and convincing evidence of actual malice. We again disagree.

As noted above, a libel plaintiff who is a public figure must prove, by clear and convincing evidence, that the defendant made the libelous statement with " ‘actual malice’—that is, with knowledge that it was false or with reckless disregard of whether it was false or not." (New York Times Company v. Sullivan (1964) 376 U.S. 254, 279-280, 84 S.Ct. 710, 11 L.Ed.2d 686 (New York Times); see Reader's Digest Assn. v. Superior Court (1984) 37 Cal.3d 244, 256-257, 208 Cal.Rptr. 137, 690 P.2d 610.) Although at trial a public figure plaintiff must establish actual malice by clear and convincing evidence, in the context of an anti-SLAPP motion the plaintiff must instead establish only a "probability" that he or she can produce clear and convincing evidence of actual malice. (Ampex Corp. v. Cargle (2005) 128 Cal.App.4th 1569, 1578, 27 Cal.Rptr.3d 863 (Ampex).)

" ‘[A]ctual malice can be proved by circumstantial evidence.’ [Citation.] Considerations such as ‘anger and hostility toward the plaintiff,’ ‘reliance upon sources known to be unreliable [citations] or known to be biased against the plaintiff,’ and ‘failure to investigate’ may, ‘in an appropriate case, indicate that the publisher himself had serious doubts regarding the truth of his publication.’ [Citation.] Such evidence is relevant ‘to the extent that it reflects on the subjective attitude of the publisher.’ " (Balla, supra , 59 Cal.App.5th at p. 683, 273 Cal.Rptr.3d 695.) However, "failure to investigate, without more, generally is insufficient" to show malice. (Ibid.) And "we will not infer

[287 Cal.Rptr.3d 477]

actual malice solely from evidence of ill will, personal spite or bad motive." (Ampex, supra , 128 Cal.App.4th at p. 1579, 27 Cal.Rptr.3d 863.)

In both his anti-SLAPP motion and now on appeal, Ellis insists he never intended to convey that Edward was found liable for fraud and paid damages to the City when he used the phrase "Edward wants his money back." According to Ellis, he cannot be held liable for a falsity he never meant to convey. (See De Havilland v. FX Networks, LLC (2018) 21 Cal.App.5th 845, 869-870, 230 Cal.Rptr.3d 625 [in cases of defamation by implication, public figure plaintiff must prove the defendant intended the defamatory impression, and not just unknowingly misled the public]; Dodds v. American Broadcasting Co. (9th Cir. 1998) 145 F.3d 1053, 1064 [same].)

The record raises credibility questions about Ellis's professions of innocence. First, there are Ellis's own explanations for what he intended to convey with the phrase "Edward wants his money back." When specifically

[72 Cal.App.5th 794]

asked at deposition what he had in mind when he used that phrase, Ellis repeatedly claimed he could not recall.4 In the absence of a meaningful explanation for his word choice, Ellis gives us no reason to believe he accidently or unknowingly misled the public when he falsely insinuated Edward had paid damages for fraud.

Second, and more importantly, Ellis expressly admitted both at deposition and in his subsequent written declaration that as part of his prepublication research for the mailers, he read the Orange County Register's article about the 2017 settlement between Edward and the City, including (1) the section describing the City's agreement to "rescind" its fraud claim against Edward and (2) the section mentioning Edward's $248,000 contribution for the community center. These admissions are critical to our analysis as they demonstrate beyond any point of dispute that Ellis knew long before distribution of the contested mailers that Edward did not pay damages to the City for fraud, yet he went ahead with the publication of mailers that insinuated the very opposite. As a result, Ellis arguably acted "with ‘actual malice’—that is, with knowledge that [the statements were] false." (See New York Times, supra, 376 U.S. at pp. 279-280, 84 S.Ct. 710.)

For these reasons, we conclude Edward "establish[ed] a probability that [he] can produce clear and convincing evidence that the allegedly defamatory statements were made with knowledge of their falsity ...." (See Ampex, supra, 128 Cal.App.4th at p. 1578, 27 Cal.Rptr.3d 863.)

We reiterate that for purposes of our anti-SLAPP analysis, Edward's burden on prong two is "not high," and we are required to "accept as true all evidence favorable to" Edward. (Greene, supra, 216 Cal.App.4th at p. 458, 156 Cal.Rptr.3d 901.) Under that low standard, Edward met his burden of showing his libel claim against Ellis has "minimal merit." (See

[287 Cal.Rptr.3d 478]

Navellier, supra, 29 Cal.4th at p. 89, 124 Cal.Rptr.2d 530, 52 P.3d 703 [only a cause of action that "lacks even minimal merit" is " subject to being stricken under the statute"].) The actual merits of Edward's claim must be resolved by the trier of fact.5

Authorities:
Manzari v. Associated Newspapers Ltd., 830 F.3d 881 (9th Cir. 2016)
Dickinson v. Cosby, 37 Cal.App.5th 1138, 250 Cal.Rptr.3d 350 (Cal. App. 2019)
Reader's Digest Assn. v. Superior Court, 208 Cal.Rptr. 137, 37 Cal.3d 244, 690 P.2d 610 (Cal. 1984)
Balla v. Hall, 59 Cal.App.5th 652, 273 Cal.Rptr.3d 695 (Cal. App. 2021)
Edward v. Ellis, 72 Cal.App.5th 780, 287 Cal.Rptr.3d 467 (Cal. App. 2021)