Case 1:17-cv APM Document 13 Filed 11/16/17 Page 1 of 9 UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLUMBIA

Transcription

1 Case 1:17-cv APM Document 13 Filed 11/16/17 Page 1 of 9 UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLUMBIA LIBRE BY NEXUS, INC. ) ) Plaintiff, ) Case No. 1:17-cv ) v. ) ) BUZZFEED, INC., et al., ) ) Defendants. ) ) PLAINTIFF S CONSOLIDATED OPPOSITION TO DEFENDANTS MOTION TO DISMISS AND SPECIAL MOTION TO DISMISS COMES NOW the plaintiff, LIBRE BY NEXUS, INC. ( Libre ), by counsel, and in Opposition to the Motion to Dismiss and Special Motion to Dismiss filed by Defendants, BUZZFEED, INC. and BEN SMITH (together, BuzzFeed ), states as follows. BACKGROUND Libre assists undocumented aliens who are held in government detention centers by U.S. Immigration and Customs Enforcement ( ICE ) pending removal/deportation proceedings to secure release on bond. Complaint, at 8. Libre contracts with bail bond companies, who actually post the immigration bond needed to secure release of the detainee. Id. The bond companies are indemnified against a forfeiture of the bond by Libre. A detainee is not required to pay collateral or otherwise secure the bond since Libre secures it (or collateralizes it) using a GPS monitoring system. Id. Using this business model, Libre has been able to reunite thousands of people who are awaiting final disposition of their immigration status with their families. Id. The Complaint alleges the crucial nature of the relationship between Libre and the bail bond companies. It is critical that Libre maintains a good relationship with the bail bond companies in order for them to accept Libre s monitoring system as security and continue to issue bonds.

2 Case 1:17-cv APM Document 13 Filed 11/16/17 Page 2 of 9 Libre s reputation with the bond companies is seriously jeopardized by false and misleading statements contained in the article published by BuzzFeed on July 23, Complaint, at 9. The sting of the defamation in this case is damage done to Libre s reputation for good business practices with the bond companies, without whom Libre cannot conduct business. A corollary to this is, of course, Libre s reputation with ICE, which administers the detention system and retains jurisdiction over detainees while released on bond. BuzzFeed chose to title its article with an accusation: Immigrants Desperate To Get Out of US Detention Can Get Trapped in Debt. The article is a compendium of false, misleading and defamatory statements about Libre and its business practices, but worst as it relates to damage to Libre s reputation with the critical bond companies, is the false statement that Libre was investigated by ICE s Homeland Security Investigations ( HSI ) for targeting undocumented immigrants in custody and fraudulently charging them a fee for services. Complaint, at 9. BuzzFeed was fully aware at the time its statements regarding an HSI investigation were published of a letter from ICE to Representative Norma Torres (U.S. Congress), dated November 15, 2015, which fully addressed and disposed of any question regarding an investigation. Complaint, at 10. The ICE letter establishes that Libre s was not under investigation in 2013, as falsely represented by BuzzFeed. The November 15, 2015, letter practically endorses Libre s business model. It states, in pertinent part: ICE has no legal authority to investigate or prosecute bail bond companies or other related service providers regarding allegations of inappropriate conduct between two private parties such as an indemnitor and bond company. Complaint, at 10. BuzzFeed s motion to dismiss relies primarily on an affirmative defense. It argues its defamatory statements relating to a HSI investigation of Libre are protected by the fair report 2

3 Case 1:17-cv APM Document 13 Filed 11/16/17 Page 3 of 9 conditional privilege. BuzzFeed seeks judicial notice of an incomplete and fragmentary document. It further argues that it s statement is at least substantially true; that stating an investigation was closed for lack of evidence is not defamatory; and, Libre has not plausibly alleged that BuzzFeed knew the statement is false. BuzzFeed s Special Motion to Dismiss, filed pursuant to the D.C. Anti-SLAPP Act, is addressed below in section (5) of this Opposition. LEGAL STANDARD To survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to state a claim to relief that is plausible on its face. Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007). A claim crosses from conceivable to plausible when it contains factual allegations that, if proved, would allow the court to draw the reasonable inference that the defendant is liable for the misconduct alleged. Banneker Ventures, LLC v. Graham, 798 F.3d 1119, 1129 (D.C. Cir. 2015) (alteration omitted). The court must accept all the well-pleaded factual allegations of the complaint as true and draw all reasonable inferences from those allegations in the plaintiff s favor. Id. In determining whether a complaint fails to state a claim, [the court] may consider only the facts alleged in the complaint, any documents either attached to or incorporated in the complaint and matters of which [the court] may take judicial notice. EEOC v. St. Francis Xavier Parochial Sch., 117 F.3d 621, 624 (D.C. Cir. 1997). If the court considers other facts, it must convert the motion to dismiss into a motion for summary judgment and provide the parties with notice and an opportunity to present evidence in support of their respective positions. Kim v. U.S., 632 F.3d 713, 719 (D.C. Cir. 2011); see Fed. R. Civ. P. 12(d). 3

4 Case 1:17-cv APM Document 13 Filed 11/16/17 Page 4 of 9 ARGUMENT (1) Affirmative Defense BuzzFeed s motion to dismiss relies fundamentally on the merits of its affirmative defense that its defamatory statements are entitled to a conditional privilege. [A]n affirmative defense may be raised by pre-answer motion under Rule 12(b) when the facts that give rise to the defense are clear from the face of the complaint. Smith-Haynie v. D.C., 155 F.3d 575, 578 (D.C. Cir. 1998). However, dismissal of the complaint is improper, as long as a plaintiff s potential rejoinder to the affirmative defense (is not) foreclosed by the allegations in the complaint. De Csepel v. Republic of Hungary, 714 F.3d 591, 608 (D.C. Cir. 2013). BuzzFeed s affirmative defense is that a fair reporting privilege applies because it reported on what it purports is an official record of HSI. Nothing in the complaint forecloses Libre s rejoinder to the affirmative defense. Separate and apart from the allegations of the complaint, BuzzFeed can rebut the affirmative defense by: (i) showing the document BuzzFeed reported on is not entitled to judicial notice since it is incomplete and fragmentary; and (ii) even if the document were admissible, BuzzFeed s reporting is not accurate or complete. Accordingly, BuzzFeed s affirmative defense is not a sufficient basis to dismiss the complaint under Rule 12(b)(6). (2) Judicial Notice In deciding a motion under Rule 12(b)(6), a court is restricted from considering matters outside the pleadings. See Hinton v. Corr. Corp. of Am, 624 F. Supp. 2d 45, 46 (D.D.C. 2009). However, a court may consider matters about which the Court may take judicial notice. Gustave-Schmidt v. Chao, 226 F. Supp.2d 191, 196 (D.D.C. 2002). A court may take judicial notice of a fact not subject to reasonable dispute in that it is either (1) generally known within 4

5 Case 1:17-cv APM Document 13 Filed 11/16/17 Page 5 of 9 the territorial jurisdiction of the the trial court or (2) capable of accurate and ready determination by resort to sources whose accuracy cannot reasonably be questioned. Fed.R.Evid. 201(b). The document for which BuzzFeed seeks judicial notice is incomplete and lacking in trustworthiness. (Declaration of Chad Bowman, Exhibit A). The document is a single page but indicates it is actually page 2 of a larger document. It is therefore incomplete. Also. BuzzFeed provides no explanation as to why the document is marked as UNAPPROVED. That designation alone raises a serious question about the trustworthiness and authenticity of the document. Judicial notice of a document that is incomplete and marked so as to indicate it is not an approved public record, i.e., unauthenticated, is improper. BuzzFeed has failed to supply the court with necessary information to grant its request for judicial notice. See Fed.R.Evid. 201(c)(2). (3) Fair Report Privilege The fair report privilege grants the right to report defamatory statements in official or public proceedings without liability, provided the report is complete, fair and accurate. RESTATEMENT (SECOND) OF TORTS 611 (1977). This conditional privilege only shields a publisher who fairly and accurately reports. Under D.C. law a publisher must clear[ ] two major hurdles to qualify for the fair report privilege: (i) publication is a fair and accurate report of a qualified government source; and (ii) that the publication properly attributes the statement to the official source. Jankovic v. International Crisis Group, 593 F.3d 22, 26 (D.C. Cir. 2010). The BuzzFeed article refers to internal ICE s in which deportation officers also expressed concerns about some of [Libre s] business model and practices. The purported internal ICE s are not linked to the article and no information is provided to identify them. 5

6 Case 1:17-cv APM Document 13 Filed 11/16/17 Page 6 of 9 The supposed HSI investigation report is actually only page 2 of a larger document that is marked UNAPPROVED. Nevertheless, a reader of the article is left with the impression that deportation officers raised concerns about Libre in an HSI investigation of Libre s business model and practices. Likewise, BuzzFeed s statement that the purported HSI investigation was were eventually closed due to lack of evidence is misleading and inaccurate. The document BuzzFeed seeks to introduce by judicial notice makes no reference to concerns raised by deportation officers, nor does it suggest any efforts were undertaken to collect evidence against Libre. The word evidence is not even used in the document. If the report is garbled or fragmentary to the point where a false imputation is made about the plaintiff which would not be present had a full and accurate report been made the privilege does not apply. Dameron v. Washington Magazine, Inc., 779 F.2d 736, 739 (D.C. Cir. 1985), cert. denied, 476 U.S (1986) (quoting, Curtis Publishing Co. v. Vaughan, 278 F.2d 23, 29 (D.C. Cir.), cert. denied, 364 U.S. 822 (1960)). The privilege does not protect unattributed, defamatory statements supported after-the-fact through a frantic search of official records. Id. (quoting, Bufalino v. Associated Press, 692 F.2d 266, 271 (2nd Cir. 1982)). And, it is not applicable where the government record is merely part of one s research. Id. (quoting, Gertz v. Robert Welch, Inc., 680 F.2d 527, 536 (7 th Cir. 1982). The intended beneficiary of the fair report privilege is the public, not the press: [t]he privilege is not simply a convenient means for shielding the media from tort liability. Dameron, at 739. BuzzFeed s use of a fragmentary, incomplete document, whose authenticity as an official record is questionable, is not shielded by the fair report privilege as a matter of fact and law. 6

7 Case 1:17-cv APM Document 13 Filed 11/16/17 Page 7 of 9 (4) Defamation In terms of the potential damage to Libre s business reputation, there is a qualitative difference between investigations by the commonwealth attorney and Fairfax City Police Departments, initiated by a disgruntled client and his immigration lawyer, and the purported investigation by ICE/HSI into Libre s business model and practices. 1 As stated, Libre must maintain its critical relationships with bond companies by demonstrating its business practices meet all requirements of the federal government. False statements regarding an investigation by ICE/HSI effects its fundamental business relationships and places its very existence as a commercially viable entity at risk. The complaint alleges with specificity that the statement is false and demonstrates that BuzzFeed knew it was false when it published the defamation by reference to the letter of November 15, 2013, from ICE to Representative Torres. The ICE letter establishes that Libre was not under investigation in 2013, as falsely represented by BuzzFeed. It practically endorses Libre s business model. It states, in pertinent part: ICE has no legal authority to investigate or prosecute bail bond companies or other related service providers regarding allegations of inappropriate conduct between two private parties such as an indemnitor and bond company. Complaint, at 10. The Complaint alleges plausibly that BuzzFeed knew that ICE did not have authority to investigate Libre s operations when it published the statement that Libre was subjected to an ICE investigation. It ignored the letter of November 15, 2013, in order to advocate against Libre s business model and damage its business reputation. 1 The linked document that purports to evidence an investigation by the commonwealth s attorney contains no reference to a commonwealth attorney investigation and is clearly deficient to show any active investigation of Libre by that office. 7

8 Case 1:17-cv APM Document 13 Filed 11/16/17 Page 8 of 9 The complaint also alleges with specificity that BuzzFeed made the false and defamatory statement with full knowledge of its falsity with the intent to cause [Libre] injury to its reputation and client relationships. [BuzzFeed] acted in actual malice and or reckless disregard as to truth or falsity knowing that the falsehood would tend to prejudice [Libre] in the eyes of clients, prospective clients, business partners, bond brokers, bond sureties, prospective business partners and members of the community in general. Complaint, at Accordingly, Libre has properly alleged that BuzzFeed published the defamatory statement with the requisite degree of fault. Malice may be inferred from the alleged facts that BuzzFeed was in possession of the letter of November 15, 2015, wherein ICE states it has not investigated Libre s business practices. Complaint, at 10. BuzzFeed consciously decided not to report that the incomplete and unauthenticated government report it relied on was contradicted, in its entirety, by a subsequent letter from ICE to a member of Congress (5) Special Motion to Dismiss (D.C. Anti-SLAPP Act) BuzzFeed additionally moves for dismissal pursuant to the D.C. Anti-SLAPP Act of 2010 (D.C. Code (a). BuzzFeed concludes that the decision of the D.C. Court of Appeals in Competitive Enter. Inst. v. Mann, 150 A.3d 1213 (D.C. 2016), clearly and unmistakably renders inaccurate the prior decision of the D.C. Circuit in Abbas v. Foreign Policy Grp., LLP, 783 F.3d 1328 (D.C. Cir. 2015). The Abbas court foreclosed application of the D.C. Anti-SLAPP Act in diversity cases. As pointed out in BuzzFeed s Notice of Supplemental Authorities [ECF No. 10], a recent decision of this court in Deripaska v. Associated Press, 17-cv-913 (D.D.C. Oct. 17, 2017) addresses the question of whether Abbas still offers clear guidance on the applicability of the D.C. Anti-SLAPP Act. 8

9 Case 1:17-cv APM Document 13 Filed 11/16/17 Page 9 of 9 In Deripaska, Judge Huvelle emphasized that the Abbas court was aware that other federal courts of appeal had come to a different conclusion when analyzing other states Anti- SLAPP statutes in similar circumstances. Id., 4. Nonetheless, the D.C. Circuit expressed agreement with the view that Federal Rules 12 and 56 answer the same question as the Anti- SLAPP Act s special motion to dismiss provision. Id., at 5. BuzzFeed s interpretation of Mann and Abbas is directly contradicted by Deripaska wherein the court found that Mann does not clearly and unmistakably resolve the question at issue and ruled that the court must follow the clear guidance of the D.C. Circuit in Abbas and deny the special motion to dismiss. Id. Nonetheless, as shown above, the D.C. Anti-SLAPP Act would not be applicable even were it relevant to these proceedings. Libre has clearly shown a strong likelihood of success on the merits given that BuzzFeed s affirmative defense of a fair report privilege is facially flawed; and that Libre has plausibly alleged defamation colored by malice and/or reckless disregard. CONCLUSION For the reasons set forth above, Libre respectfully requests that the Motion to Dismiss and Special Motion to Dismiss be denied. Dated: November 16, 2017 Respectfully submitted, /s/john M. Shoreman John M. Shoreman (DC ) McFADDEN & SHOREMAN 1050 Connecticut Avenue, NW Suite 500 Washington, DC (202) Fax (202) mstlaw@erols.com Counsel for Plaintiff Libre By Nexus, Inc. 9