Sunday, June 03, 2012

Employer SLAPPed for Suing Ex-Employee

Robert Rogers is a former officer of Summit Bank, a local, Oakland bank.  When Summit learned there were a number of anonymous, negative posts about it on Craigslist, it decided to sue Rogers for defamation. Here are some of his posts, according to the court:

The June 7, 2009 post: ―Being a stockholder of this screwed up Bank, this year there was no dividend paid. The bitch CEO that runs this Bank thinks that the Bank is her personel [sic] Bank to do with it as she pleases. Time to replace her and her worthless son.

 The June 21, 2009 post: ―Whats [sic] up at this problem Bank. The CEO provides a [sic] executive position to her worthless, lazy fat ass son Steve Nelson. [¶] This should not be allowed. Move your account now.

 The July 14, 2009 post: ―The FDIC and the California Department of Financial Institutions are looking at Summit Bank. This is the third time in less than one year. This is not a good thing, move your accounts ASAP.‖

The July 25, 2009 post: ―I had banked at Summit Banks [sic] Hayward Office. Service was poor and Summit Bank closed this office. Whats [sic] up with that. [¶] All the customer [sic] were left high and dry. This is a piss poor Bank. I would suggest that anyone that banks at Summit Bank leave before they close. 
The second July 25, 2009 post: ―Move your accounts now before its [sic] too late.

The Bank learned that Rogers was the author of the anonymous posts and named him in the lawsuit as the defendant.

Rogers then brought an "anti-SLAPP" motion, used to strike lawsuits that arise from protected speech.  The Bank argued that Rogers' speech was not protected, because making false allegations about a bank's financial condition is criminal conduct under California law.  (When the conduct upon which a lawsuit is based is criminal, a SLAPP motion is barred.)

The trial court denied Rogers' motion because the trial court believed that Rogers' conduct was actionable as defamation and that the Bank was likely to win.  Rogers appealed.

The Court of Appeal, though, decided that the trial court should have granted Rogers' Motion to Strike.  First, the Court of Appeal held that Financial Code Section 1327 (which criminalizes false statements about a bank's financial condition) is an unconstitutional violation of freedom of speech.

The Court then decided that Rogers' posting on an internet bulletin board was speech in furtherance of the public interest in stable, financially sound banking, entitling him to the protection of the anti-SLAPP statute.   Rogers therefore satisfied step one of the two-step analysis applicable to anti-SLAPP motions.

Step 2 involves an analysis regarding whether the plaintiff (Bank) is likely to succeed on its defamation claim against Rogers' posts.  The Court of Appeal decided that the Bank could not win on its defamation suit because Rogers' posts were expressions of (1) true facts - such as financial difficulties the bank had experienced or (2) "opinion" rather than fact. The Court took into consideration that the posts were on the "Rants and Raves" part of Craigslist, that bulletin boards are known for hyperbole and strong opinions, and that in context, even the arguably factual statements were more likely to be understood as opinion.

This case proves it can be hard to sue disgruntled ex-employees for defamation based on anonymous web postings.  The CEO, called a "bitch," and basically accused of stealing money, has no remedy against Rogers.  The Bank, accused of stiffing customers of a closed branch (untrue allegedly), also has no remedy. And because Rogers won his anti-SLAPP motion, he gets his attorney's fees. What a country!

The case is Summit Bank v. Rogers and the opinion is here.