Medical Marijuana, Inc. v. ProjectCBD.com
6 Cal. App. 5th 602
| Cal. Ct. App. | 2016Background
- Plaintiffs Medical Marijuana, Inc. (MMI) and HempMeds allege defendants published false statements that RSHO (a CBD product) was contaminated and made consumers ill, causing substantial economic harm.
- Defendants ProjectCBD, Martin Lee, and Aaron Cantu (Project CBD defendants) published an article titled “Hemp Oil Hustlers” on Project CBD’s website on October 14, 2014 (updated Nov. 4, 2014); other defendants and third parties posted related statements on Facebook in May–June 2014.
- Plaintiffs’ operative first amended complaint pleads libel (count 1) and false light (count 3) among other claims, incorporating general allegations that reference the October article and various Facebook posts.
- The Project CBD defendants moved under California’s anti‑SLAPP statute (Code Civ. Proc. § 425.16). The trial court struck some claims but denied the motion as to counts 1 and 3, finding plaintiffs showed a probability of prevailing and were not limited public figures (or, alternatively, had raised triable malice issues).
- On appeal, the court concluded the complaint, as pleaded, does not allege any particular defamatory acts by the Project CBD defendants during the May–June Facebook timeframe identified in the specific libel/false‑light paragraphs; the only alleged Project CBD activity was the October article (not pleaded as forming the libel/false‑light claims).
- The Court of Appeal affirmed the denial of the anti‑SLAPP motion but on different grounds: because the libel and false‑light counts did not allege any conduct by the Project CBD defendants that gave rise to those specific claims, the defendants could not identify protected activity that would trigger the anti‑SLAPP analysis; the appropriate remedy is for defendants to pursue traditional pleading challenges (e.g., demurrer) if needed.
Issues
| Issue | Plaintiffs' Argument | Defendants' Argument | Held |
|---|---|---|---|
| Whether libel and false‑light claims against Project CBD arise from protected activity and thus are subject to anti‑SLAPP dismissal | Plaintiffs relied on incorporated general allegations (including the October article) and argued they showed a probability of prevailing on counts 1 and 3 | Defendants argued the libel/false‑light claims arise from protected speech and should be struck; also contended plaintiffs are limited public figures requiring proof of actual malice | Court held the anti‑SLAPP denial was affirmed but on different grounds: the FAC does not allege any specific defamatory acts by Project CBD supporting counts 1 and 3, so defendants cannot identify protected activity that would trigger the anti‑SLAPP process |
| Whether plaintiffs are limited public figures and must prove actual malice | Plaintiffs argued they are not limited public figures | Defendants argued plaintiffs were limited public figures and thus must prove actual malice | Court did not resolve public‑figure question on merits; because defendants failed to show the claims arose from their protected activity, the anti‑SLAPP pathway was not triggered and the court declined to address malice here |
| Whether plaintiffs demonstrated a probability of prevailing on libel/false‑light (actual malice or fault) | Plaintiffs pointed to allegedly false statements in the October article and reporting failures to show fault or malice | Defendants argued plaintiffs could not show falsity, fault, or malice for the Project CBD defendants | Court did not reach the second‑step merits inquiry as to Project CBD because the complaint fails to plead Project CBD conduct as the basis for counts 1 and 3; therefore the anti‑SLAPP second step was not reached |
| Proper remedy when complaint fails to allege defendant’s conduct for particular counts | Plaintiffs sought to preserve counts and proceed under their pleading | Defendants sought anti‑SLAPP dismissal of those counts | Court held anti‑SLAPP is not appropriate where the FAC alleges no act by moving defendant giving rise to the claim; defendants may pursue demurrer or other remedies in trial court instead |
Key Cases Cited
- Baral v. Schnitt, 1 Cal.5th 376 (2016) (explains two‑step anti‑SLAPP analysis and burden shifts)
- Navellier v. Sletten, 29 Cal.4th 82 (2002) (focus on defendant’s act that gives rise to plaintiff’s claim when assessing anti‑SLAPP applicability)
- Jarrow Formulas, Inc. v. LaMarche, 31 Cal.4th 728 (2003) (anti‑SLAPP first‑step requirement: determine whether cause of action arises from protected activity)
- Briggs v. Eden Council for Hope & Opportunity, 19 Cal.4th 1106 (1999) (second‑step: plaintiff must show probability of prevailing on the merits)
- Flatley v. Mauro, 39 Cal.4th 299 (2006) (defendant need only make prima facie showing that their alleged acts fall into §425.16(e) categories)
- Taus v. Loftus, 40 Cal.4th 683 (2007) (elements of defamation and libel/false‑light equivalence)