6 F.4th 1301
D.C. Cir.2021Background
- Larry Klayman founded Judicial Watch and served as Chairman and General Counsel until a 2003 separation; he and Judicial Watch dispute whether he resigned to run for Senate or was forced to resign for misconduct (including alleged assault and an improper relationship).
- Klayman and Judicial Watch executed a severance agreement (prohibiting disparagement and access to donor lists); Judicial Watch paid $600,000; Klayman’s campaign later used ATA (Judicial Watch’s vendor) to mail solicitations to Judicial Watch donors and then launched a "Saving Judicial Watch" campaign targeting those donors.
- Klayman sued Judicial Watch in 2006 asserting Lanham Act, breach of contract (fair comment), and defamation claims and sought rescission; Judicial Watch counterclaimed for breach of the severance agreement, trademark infringement, and Lanham Act unfair competition.
- During discovery Klayman failed to produce requested documents and submitted an inadequate pretrial statement; the court sanctioned him by precluding him from offering documents and striking portions of his pretrial statement, leaving him able to testify but not to introduce affirmative documentary evidence.
- The district court granted partial summary judgment to Judicial Watch on multiple claims; a 2018 jury trial returned a $2.3 million verdict for Judicial Watch on remaining claims (including breach for use of donor lists). Klayman’s post-trial motions were denied and this appeal followed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Timeliness of appeal | Klayman: his Rule 60 motion (filed within 28 days) restarted the appeal period, so appeal is timely | Judicial Watch: appeal untimely / concerns about successive restarts | Appeal timely; Rule 4(a)(4)(A) restarts appeal period for a timely Rule 60 motion and parties measured from the final judgment date agreed below |
| Sanctions for discovery and pretrial noncompliance | Klayman: sanctions were excessive and prejudicial, denying his ability to present his case | JW: Klayman repeatedly disobeyed discovery and pretrial orders; he waived some objections and sanctions were proportional | No abuse of discretion; Klayman waived challenge to discovery sanction and pretrial-statement strike was proportional given prejudice, delay, and deterrence interests |
| Summary judgment on Lanham Act, breach (fair comment), and defamation claims | Klayman: newsletter misidentified him after resignation; evidence showed JW blocked his media appearances; JW statements about his debt were false/made with malice | JW: newsletter was authorized when produced; proffered documents on media requests are hearsay; JW relied on audits and had no actual malice | Affirmed: newsletter not false at time sent; hearsay insufficient to defeat summary judgment on fair-comment breach; no admissible evidence of actual malice on defamation claim |
| Jury verdict re: breach for using donor lists and admissibility of misconduct evidence | Klayman: ATA owned lists, so no prohibited taking; misconduct evidence was prejudicial character evidence | JW: evidence showed Klayman targeted JW donors via ATA; misconduct evidence was relevant to rebut his claim he left to run for Senate | Verdict and evidentiary rulings affirmed: sufficient evidence Klayman used JW donor data in violation of severance; misconduct evidence was relevant and not unfairly prejudicial or barred by Rule 404(b) |
Key Cases Cited
- Dellums v. Powell, 566 F.2d 231 (D.C. Cir. 1977) (sanctions reviewed for abuse of discretion)
- Founding Church of Scientology of Wash., D.C., Inc. v. Webster, 802 F.2d 1448 (D.C. Cir. 1986) (prejudice to courts and other parties as a factor in sanctions)
- Bonds v. District of Columbia, 93 F.3d 801 (D.C. Cir. 1996) (proportionality in selecting sanctions)
- Greer v. Paulson, 505 F.3d 1306 (D.C. Cir. 2007) (hearsay on summary judgment counts for nothing absent showing it can be converted to admissible evidence)
- Jankovic v. Int’l Crisis Grp., 822 F.3d 576 (D.C. Cir. 2016) (actual malice standard for public-figure defamation)
- New York Times Co. v. Sullivan, 376 U.S. 254 (U.S. 1964) (actual malice requirement for defamation of public officials/figures)
- Sprint/United Mgmt. Co. v. Mendelsohn, 552 U.S. 379 (U.S. 2008) (deference to district court’s evidentiary judgments)