515 F.Supp.3d 149
S.D.N.Y.2021Background:
- Plaintiff Harvey Kesner is a New York–licensed securities lawyer formerly a named partner at Sichenzia Ross Ference Kesner LLP; he had business ties to investor Barry Honig and to a stock-transfer firm, Equity Stock Transfer.
- The SEC sued Honig and associates in a pump-and-dump case naming three anonymous companies; MabVax later sued Kesner’s firm for malpractice; neither SEC complaint named Kesner.
- Barron’s (Dow Jones) published an October 4, 2018 article by Bill Alpert headlined “The Lawyer at the Center of the SEC Pump-and-Dump Case,” summarizing the SEC and MabVax pleadings and reporting Kesner’s ties; Teri Buhl published multiple articles and tweets alleging or speculating about Kesner’s role.
- Kesner sued Dow Jones, Alpert, and Buhl for defamation and related torts (commercial disparagement, deceptive/unfair trade practices, tortious interference, conspiracy); the case was transferred to SDNY and New York law applied.
- The court dismissed all claims against Dow Jones and Alpert (Barron’s article and headline not actionable or protected by New York’s fair-report/fair-index privileges and opinion doctrines).
- The court dismissed most of Buhl’s challenged statements but allowed three narrow defamation theories to proceed against Buhl: (1) October 31, 2018 article labeling Kesner part of “Team Honig”/an "alleged bad actor," (2) March 27, 2019 tweet accusing Kesner of illegal conduct re: BioZone, and (3) June 7, 2019 article alleging emails show Kesner aided questionable share transfers; all non-defamation torts and the conspiracy claim were dismissed.
Issues:
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Choice of law | Apply Florida law (Kesner domiciled in Florida) | Apply New York law (defendants/Newspaper based in NY; conduct centered in NY) | New York law applies (NY has greatest interest given Kesner’s NY practice and defendants’ NY ties) |
| Barron’s article body (gatekeeper/malpractice implications) | Article implied Kesner failed as a securities "gatekeeper" and accused him of wrongdoing | Article accurately summarized public pleadings (MabVax/SEC); such reporting is protected by NY Civ. Rights Law § 74; where attributions exist, no adopted defamatory implication | Dismissed: body not reasonably susceptible to defamatory meaning; qualified/absolute privileges and attribution to pleadings protect it |
| Barron’s headline (“Lawyer at the Center…”) | Headline implied Kesner personally committed securities fraud (defamation per se) | Headline is a fair index of the article and constitutionally protected opinion; context discloses unnamed role | Dismissed: headline is a fair index and protected by § 74/fair-index privilege and by opinion context |
| Buhl — August 29 and similar speculative pieces | Statements accused or implied criminality and motive (moving to Florida to avoid judgments) | Statements are opinion, disclosed bases, and were substantially true where factual predicates exist | Dismissed as non-actionable opinion where facts were disclosed and statements were speculative |
| Buhl — discrete allegations (Oct 31 article; Mar 27 tweet; June 7 article) | Those specific statements falsely accused Kesner of being a "bad actor," illegal conduct, and aiding improper transfers | Defendants invoke fair-report/fair-index privileges and opinion defenses; argue some statements hyperlinked to public pleadings | Survived dismissal for three discrete statements: Oct. 31 label "alleged bad actor," Mar. 27 tweet accusing illegal conduct, June 7 article alleging emails show improper assistance — these plausibly allege falsity and fault |
| Non-defamation torts & conspiracy | Claims based on same publications caused economic harm; should proceed | These claims duplicate defamation and seek same damages; conspiracy allegations are conclusory | Dismissed: non-defamation torts duplicate defamation; conspiracy claim fails for absence of factual allegations of an agreement |
Key Cases Cited
- Bell Atl. Corp. v. Twombly, 550 U.S. 544 (plausibility standard for pleading)
- Ashcroft v. Iqbal, 556 U.S. 662 (pleading standards; legal conclusions not entitled to assumption of truth)
- Klaxon Co. v. Stentor Elec. Mfg. Co., 313 U.S. 487 (choice-of-law principle for federal courts in diversity)
- Stepanov v. Dow Jones & Co., 120 A.D.3d 28 (N.Y. appellate decision setting heightened standard for defamation by implication)
- Gross v. N.Y. Times Co., 82 N.Y.2d 146 (distinguishing fact, opinion, and mixed opinion in defamation law)
- Palin v. N.Y. Times Co., 940 F.3d 804 (elements and context test for defamation at pleading stage)
- Karedes v. Ackerley Grp., Inc., 423 F.3d 107 (fair report privilege and substantial accuracy standard)
- Celle v. Filipino Rep. Enters., Inc., 209 F.3d 163 (contextual reading of allegedly defamatory statements)
- Liberman v. Gelstein, 80 N.Y.2d 429 (defamation per se categories and professional injury)