Opinion
CV-19-418
06-16-2020
DAVRIC MAINE RACING, LLC, DENISE TERRY, Individually and as Trustee of the Joseph Ricci Trust of 2000 and the Sharon Terry Trust, and STEPHEN COBBETT Plaintiffs, v. LIPMAN & KATZ, P.A., CALEB GANNON, and KARL BUTTERFIELD, Defendants.
For Plaintiffs: Edward MacColl, Esq. For Defendant Karl Butterfield: Elliott Teel, Esq.
For Plaintiffs: Edward MacColl, Esq.
For Defendant Karl Butterfield: Elliott Teel, Esq.
ORDER ON DEFENDANTS LIPMAN & KATZ, P.A., and CALEB GANNONS' SPECIAL MOTION TO DISMISS
MaryGay Kennedy, Justice
Before the court is Defendants Lipman &e Katz, PA and Caleb Gannon's special motion to dismiss Plaintiffs' Complaint pursuant to 14 M.RS. § 566 (2019), Maines anti-SLAPP (strategic lawsuit against public participation) statute.
For the following reasons. Defendants' Motion may not be granted at this time.
I. Background
Davric Maine Racing, LLC, ("Scarborough Downs") owns and operates a harness racetrack and entertainment business in Scarborough, Maine. (Pl.s' Compl. ¶ 1.) Plaintiff Denise Terry ("Ms, Terry") is the current treasurer and by 2018, she had taken over day-to-day operations. (Pl.s' Compl. ¶ 3.)
Plaintiffs allege that as a result of certain misconduct, the Maine State Harness Racing Commission (hereinafter the "Commission") banned Defendant Karl Butterfield ("Mr. Butterfield") from participating as an owner or trainer of harness race horses in Maine. (Pl.s' Compl. ¶¶ 7, 9.)
Mr. Butterfield has not joined in this motion.
Around April 2018, Mr. Butterfield appeared before the Commission and had his license reinstated. (Pl.s' Compl. ¶ 9.) At that same time - presumably at the hearing -Stephen Cobbett ("Mr. Cobbett")/ also an employee of Scarborough Downs, informed him that "given the misconduct he had been found to have committed, Scarborough Downs would not allow his participating in racing at the Downs." (Pl.s' Compl. ¶¶ 2, 9.)
On July 24, 2018 on behalf of their client Mr. Butterfield, Defendants Lipman & Katz and Attorney Caleb Gannon sent Ms. Terry a letter claiming that Mr. Cobbett had made certain anti-Semitic remarks, and that he banned Mr. Butterfield because of his religious and ethnic background. (Pl.s' Compl. ¶ 10.) The letter, of which the Complaint is based upon, provides, in relevant part:
Dear Ms. Terry:
Karl Butterfield appeared before the Maine Harness Racing Commission on April 12, 2018 in response to the denial of his license application. After a hearing his license was granted. Mr. Butterfield has a provisional license allowing him to race horses in the State of Maine.
A person attending the hearing was Stephen Cobbett who is the Operations Director of Scarborough Downs. Evidently, Stephen Cobbett doesn't like Karl Butterfield and has had a history with both Mr. Butterfield and Mr. Butterfield's wife concerning his participation in harness racing in the State of Maine. Mr. Cobbett was upset about Karl Butterfield being granted a license and stated to Karl Butterfield "even though you were granted a license today, you will never be allowed at Scarborough Downs as a patron or licensee. My opinion of you has not changed. You are no good and never will be good. You don't pay your bills, and as far as I am concerned you an arrogant cocky Jew who should go back to New York where you belong. You are never going to race anywhere in Maine after I call other tracks."
. . . Since Scarborough Downs employs Stephen Cobbett and Stephen Cobbett is the Operations Director, the license of Scarborough Downs should be suspended. A licensee that discriminates against Jews and New Yorkers should not be allowed to operate.
In writing this letter to Sharon Terry, we have also written to the Maine Harness Racing Commission to ask for an immediate hearing. Should Scarborough Downs race track be suspended for the actions of the operations director discriminating against New Yorkers and Jews?(Pl.s' Compl. Ex. Aƒ at 1-2.) Plaintiffs continue to deny these accusations, and allege that Defendants knew or should have known them to be false. (Pl.s' Am. Compl. ¶ 13.) Plaintiffs allege that Defendants knew that neither Mr. Cobbett nor anyone associated with Scarborough Downs based any part of their decision to ban Mr. Butterfield based on his actual or perceived ethnic or religious background. (Pl.s' Compl. ¶ 11.)
Plaintiffs maintain that the letter was merely an attempt to intimidate plaintiffs, damage their reputations, and cause them "great emotional and financial distress." (Pl.s' Compl. ¶¶ 10-11, 12.) Defendants also sent copies to Mr. Cobbett, the Maine State Harness Racing Commission, the Sports Editor at the Portland Press Herald, and Scarborough Downs' principal competitor. (Pl.s' Compl. ¶ 14.)
After Defendants refused Plaintiffs' request for an apology and a retraction, Defendants shared an affidavit, executed by a Donna Scanlon ("Ms. Scanlon"), a resident of New York, claiming that she attended the meeting at the Maine Harness Racing Commission in which Mr. Cobbett allegedly made these discriminatory comments. (Pl.s' Compl. ¶ 17; See Def's Ex. B.) Plaintiffs claim that Defendants knew or should have known that Ms. Scanlon never attended the hearing or heard any such statements. (Pl.s' Compl. ¶ 18.)
On October 18, 2019, Plaintiffs filed a four count complaint alleging: (Count I) Defamation; (Count II) Negligent Infliction of Emotional Distress; (Count EEI) Intentional Infliction of Emotional Distress; and (Count IV) Punitive Damages. On January 10, 2020, Defendants Lipman & Katz and Caleb Gannon (hereinafter "Defendants") filed this Special Motion to Dismiss Plaintiffs' Complaint pursuant to 14 M.R.S. § 556.
II. Discussion
A. Maine's Anti-SLAPP Statute
Defendants filed this special motion to dismiss pursuant to Maine's anti-SLAPP statute on the grounds that the July 28, 2018 letter and the statements contained therein is protected "petitioning activity." (Mot. Dismiss 4.)
Maine's anti-SLAPP statute provides, in relevant part:
When a moving party asserts that the civil claims ... against the moving party are based on the moving party's exercise of the moving party's right of petition under the Constitution of the United States or the Constitution of Maine, the moving party may bring a special motion to dismiss. . . . The court shall grant the special motion unless the [nonmoving party] shows that the moving party's exercise of its right of petition was devoid of any reasonable factual support or any arguable basis in law and that the moving party's acts caused actual injury to the responding party. In making its determination, the court shall consider the pleading and supporting and opposing affidavits stating the facts upon which the liability or defense is based.14 M.R.S. § 556.
The statute "purports to provide a means for the swift dismissal of such lawsuits early in the litigation as a safeguard on the defendant's First Amendment right to petition." Hamilton v. Woodsum, 2020 ME 8, ¶ 15, 223 A.3d 904 (citation omitted). "The purpose of the anti-SLAPP statute is to protect against meritless claims brought to delay, distract, and punish activists for speaking." Hearts with Haiti, Inc. v. Kendrick, 2019 ME 26, ¶ 14, 202 A.3d 1189.
The Law Court adopted a three step process that courts must follow when deciding a special motion to dismiss. Guadette v. Davis, 2017 ME 86, ¶¶ 16-18, 160 A.3d 1190. In making its determination, the court considers the pleadings and supporting and opposing affidavits. 14 M.R.S. § 556.
The court must first determine whether, as a matter of law, the moving party established that "the anti-SLAPP statute applies to the conduct that is the subject of the plaintiff's complaint by establishing that the suit was based on some activity that would qualify as an exercise of the defendant's First Amendment right to petition the government." Hearts with Haiti, 2019 ME 26, ¶ 11, 202 A.3d 1189 (citation omitted). If the moving party does not meet that burden, "then the special motion to dismiss must be denied." Id. (citation omitted.)
A qualifying "petitioning activity" is defined as:
Any written or oral statement made before or submitted to a legislative, executive or judicial body, or any other governmental proceeding; any written or oral statement made in connection with an issue under consideration or review by a legislative, executive or judicial body, or any other governmental proceeding; any statement reasonably likely to encourage consideration or review of an issue by a legislative, executive or judicial body, or any other governmental proceeding; any statement reasonably likely to enlist public participation in an effort to effect such consideration; or any other statement falling within constitutional protection of the right to petition government.14M.R.S.§556.
If the moving party establishes that the subject of the litigation constitutes petitioning activity, then the burden shifts to the nonmoving party to establish "[1] prima facie evidence that defendant's petitioning was devoid of any reasonable factual support or any arguable basis in law and [2] that the defendant's petition activity caused actual injury to the plaintiff." Guadette, 2017 ME 86, ¶ 17, 160 A.3d 1190 (citations omitted) (quotation marks omitted).
If the plaintiff satisfies their prima facie burden,, the special motion to dismiss is not automatically denied. Id. ¶ 18. Rather, upon a motion by either party, the court may permit a limited period for discovery followed by an evidentiary hearing in which the plaintiff must establish "by a preponderance of the evidence, each of the elements for opposing the dismissal on anti-SLAPP grounds for which he successfully made out his prima facie case-that the defendant's petitioning activity was devoid of factual support or an arguable legal basis and that the petitioning activity caused the plaintiff actual injury." Id.
Discovery is strictly limited to the elements demonstrating Plaintiffs' burden; discovery and evidence that relates to the underlying causes of actions are not relevant at this stage . of the proceeding. Guadette, 2017 ME 86, ¶ 19, 160 A.3d 1190.
If neither party files a motion, the court will decide "whether plaintiff has met this burden by a preponderance of the evidence based only on the parties' submissions in seeking and opposing the special motion to dismiss. Id.
B. Analysis
Defendants' argue that the July 24, 2018 letter qualifies as a statement made to "encourage Commission review" or a statement "reasonably likely to encourage consideration or review of an issue by an executive body." (Mot. Dismiss 7.)
Indeed, Defendants' represented in their letter that they "have also written to the Maine Harness Racing Commission to ask for an immediate hearing" regarding the Scarborough Downs' license in relation to Mr. Cobbetf s alleged statements. (Pl.s' Ex. A, at 2.) The Affidavit of Defendant Caleb Gannon confirms that copies of the letters were sent to a Sports Reporter at the Press Herald and the Maine Harness Racing Commission. (Gannon Aff. ¶¶ 5-6.)
Accordingly, at this stage, Defendants have satisfied their burden of establishing that the statute applies to their conduct that is the subject of the Complaint. See 14 M.R.S. § 556 (a party's exercise of its right to petition includes any statement reasonably likely to encourage consideration or review of an issue by an executive body).
The Law Court has recognized that "the typical mischief that the anti-SLAPP legislation intended to remedy was lawsuits directed at individual citizens of modest means for speaking out publicly against development projects." Hearts with Haiti, 2019 ME 26, ¶ 13, 202 A.3d 1189 (citing Morse Bros., 2001 ME 70 ¶ 10, 772 A.2d 842
Nonetheless, Plaintiffs satisfied their burden establishing prima facie evidence that Defendants' petitioning activity does not fall within the protection of the ant-SLAPP statute. Prima facie evidence is a "low standard that does not depend on the reliability or the credibility of evidence, all of which may be considered at some later time in the process." Cookson v. State, 2011 ME 53, ¶ 8, 17 A.3d 1208.
Ms. Terry's affidavit states that, after investigating the allegations, the Executive Director of the Commission assured her that no one had requested an investigation into the Scarborough Downs' license or Mr. Cobbetf s alleged conduct. (Terry Aff. ¶¶ 6, 16.) Rather, the true intent behind the letter was to revive Mr. Butterfield's "concerted effort to harass, intimidate, threaten, and damage Mr. Cobbett and the downs" as a result of their complicated history. (Terry Aff. ¶ 7.) Plaintiffs' maintain that the "decision had nothing to do with Mr. Butterfield's race, ethnicity or religion." (Terry Aff. ¶ 12.) Indeed, Ms. Terry stated, "I was well aware of Mr. Butterfields earlier efforts to harass, threaten and intirnidate my employees, I was confident the allegations were false." (Terry Aff. ¶ 15.)
According to Plaintiffs, in April 2007, the New York State Police notified the Scarborough Downs that $40,000 worth of racing equipment had been stolen from the Saratoga Raceway and may be on its way. Mr. Cobbett located the stolen equipment and advised the police that that Mr. Butterfield was involved. Shortly thereafter, Plaintiffs' allege that Mr. Butterflied "initiated a series of highly offensive actions" that ultimately led Mr. Cobbett to notify the police. (FLs' Opp'n to Def .s' Mot. 3.) This included "false statements . . . threatening phone calls, ordering or causing to be ordered goods and services which Mr. Butterfield falsely claimed were ordered by the Downs or by Mr. Cobbett" and "postings on internet chat websites used by the harness racing community." (Terry Aff. ¶¶ 7, 9, 20; Pl.s' Opp'n to Def.s' Mot. 2-4.)
Plaintiffs have further established prima facie evidence that Defendants' petitioning activity caused actual injury to Plaintiffs. See 14 M.R.S. g 556. Although Plaintiffs' pleadings and affidavits fail to establish that their "significant emotional distress" caused actual injury Ms. Terry stated that Scarborough Downs' "incurred substantial monetary expense in hiring counsel to investigat[e] the false and fraudulent allegation/' and that die Scarborough Downs' "reputation is being undermined by the defendants' false allegations." (Terry Aff. ¶¶ 17, 23.)
'"[P]urely emotional injuries'' could only constitute 'actual injury' to the/extent that those emotional damages were otherwise compensable pursuant to existing statutory or common law . .. emotional distress [pursuant to section 556] alone is not compensable unless it is so severe that no reasonable person could be expected to endure it." Desjardins v, Reynolds, 2017 ME 99, ¶ 20, 162 A.3d 228 (internal citation omitted) (quotation marks omitted).
Plaintiffs' contend that the "Lipman and Katz Defendants apparently were willing to wager that the Downs, rather than incur die cost of investigating [Mr, Butterfield's allegations], would simply cave and allow Mr. Butterfield to participate ., .," (Pls' Opp'n to Def, s' Mot. 11.)
III. Conclusion
Because both patties have satisfied their respective burdens, the court may not grant or deny Defendants' special motion to dismiss on anti-SLAPP statute grounds without further information. See Guadette, 2017 ME 86, ¶ 18, 160 A.3d 1190. The court invites either party, if they so choose, to file a motion with this court to request a brief period of limited discovery and evidentiary hearing.
The Clerk is directed to incorporate this Order into the docket by reference pursuant to Maine Rule of Civil Procedure 79(a),