31 F.4th 135
2d Cir.2022Background
- Devin G. Nunes, a California domiciliary and U.S. Congressman, sued CNN for defamation and civil conspiracy over a Nov. 22, 2019 CNN article and related broadcast that alleged he met with a Ukrainian official to obtain damaging information about Joe Biden.
- The suit was filed in the Eastern District of Virginia on Dec. 3, 2019, then transferred to the Southern District of New York; Virginia choice-of-law rules govern because of the transferor forum.
- The district court predicted how the Virginia Supreme Court would apply lex loci delicti to a simultaneous multistate internet publication and concluded the place of the wrong is where the plaintiff suffered the greatest reputational injury—presumptively the plaintiff’s domicile—and therefore applied California law.
- Applying California Civil Code § 48a (the retraction statute), the district court held Nunes failed to allege a timely retraction demand and failed to plead special damages with the specificity required by Fed. R. Civ. P. 9(g), limiting recovery and requiring dismissal.
- The district court also dismissed the civil-conspiracy claim because, under California law, conspiracy without an underlying tort imposes no independent liability.
- The Second Circuit affirmed: (1) Virginia lex loci delicti, as applied to multistate internet publication, points to the state of greatest injury (domicile presumptively); (2) California law governs; (3) § 48a is substantive under Virginia choice-of-law rules and Nunes failed to plead the statute’s prerequisites or special damages; conspiracy claim therefore fails.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Choice-of-law rule for multistate online defamation (place of wrong) | Apply law of state where publication originated (New York) | Place of wrong is where plaintiff was primarily injured; because injuries are multistate, use domicile as presumptive locus | Virginia would apply lex loci delicti adapted for multistate internet publication: law of state of greatest reputational injury, presumptively plaintiff's domicile; New York not controlling |
| Proper identification of place of injury here | Nunes: greatest injury in D.C. or Virginia (where he worked); or merits require discovery | CNN: complaint alleges strong ties to California; domicile presumption controls absent strong countervailing facts | Complaint alleges substantial California ties; no countervailing facts shown—California law applies |
| Applicability/nature of California retraction statute (Cal. Civ. Code § 48a) | § 48a is procedural and should not apply under Virginia choice-of-law rules | § 48a limits recovery (substantive) and thus applies when California law governs | § 48a is substantive under Virginia conflict rules; it applies and Nunes did not satisfy its demand requirement |
| Pleading requirements: retraction demand, special damages, and conspiracy claim | Should be allowed leave to amend to plead special damages and demand; conspiracy stands | Nunes did not plead a § 48a demand or special damages with Rule 9(g) specificity; conspiracy fails without underlying tort | Dismissal with prejudice affirmed: no timely retraction demand alleged, special damages not pled with required specificity, conspiracy dismissed because no viable underlying tort |
Key Cases Cited
- Dreher v. Budget Rent-A-Car Sys., Inc., 272 Va. 390 (Va. 2006) (Virginia applies lex loci delicti to torts)
- Quillen v. Int’l Playtex, Inc., 789 F.2d 1041 (4th Cir. 1986) (place of wrong is where last event necessary to make actor liable occurs)
- Wells v. Liddy, 186 F.3d 505 (4th Cir. 1999) (defamation place of harm is where statement is communicated/received)
- Klaxon Co. v. Stentor Elec. Mfg. Co., 313 U.S. 487 (U.S. 1941) (federal transferee courts apply transferor state's choice-of-law rules)
- Van Dusen v. Barrack, 376 U.S. 612 (U.S. 1964) (choice-of-law follows transferor forum on §1404(a) transfer)
- U.S. Bank Nat’l Ass’n v. Bank of Am. N.A., 916 F.3d 143 (2d Cir. 2019) (transfers adjudicated under transferor law)
- Ashcroft v. Iqbal, 556 U.S. 662 (U.S. 2009) (pleading standards require more than conclusory allegations)
- Applied Equip. Corp. v. Litton Saudi Arabia Ltd., 869 P.2d 454 (Cal. 1994) (under California law, conspiracy alone does not create tort liability)