In an age where the luxurious lives of reality housewives populate millions of televisions throughout the country, the day-to-day activities of wealthy suburban moms are well known to Americans. Stephanie Smith, a wealthy mother of five young children living in the Pacific Palisades near the luxurious Los Angeles coastline, was one such woman. One noteworthy thing set Stephanie Smith apart, however – her multi-million-dollar marijuana empire.
Smith was a commercial real estate developer and landlord who leased her properties to marijuana growers. Those growers allegedly paid her more than three times the standard rent and produced tens of thousands of weed plants. On December 13, 2017, Smith’s weed-growing warehouses became public knowledge after police raided her home and discovered the plants.
Newspapers immediately picked up the story, calling Smith a “Queenpin” and her property “a weed fortress.” Smith v. Palisades, No. B292107 2019 WL 4744765 (Cal. Ct. App. Sept. 30, 2019) at *1. Palisades News, a local community newspaper, published an article stating that Smith was “busted” for running an illegal marijuana-growing operation of a size normally associated with a “drug lord” and that Smith made millions of dollars per month from the operation. Id. Three months after the raid, Smith sued Palisades News for defamation (libel), false light, and intentional infliction of emotional distress in Smith v. Palisades News.
In response to Smith’s defamation suit, Palisades News filed a special motion to strike pursuant to California’s anti-SLAPP statute. The anti-SLAPP statute provides a two-pronged procedure to determine whether a claim should be stricken. First, the defendant must show that the plaintiff’s claim arises from protected activity. If the defendant makes this showing, the plaintiff must demonstrate a probability of prevailing on her claims. In Smith, both parties agreed that the second prong was at issue and required Smith to demonstrate her probability of prevailing on her defamation claim.
In order to prove defamation, the plaintiff must show the defendant’s fault in publishing the defamatory communication. If the plaintiff is a private figure, he or she must prove that the defendant was negligent based on the standard of a reasonable person. On the other hand, a plaintiff who is a public figure must prove a higher level of fault – actual malice. The standard for malice is difficult to meet because it requires a showing that the defendant made the statement with knowledge of its falsity or reckless disregard for its truth or falsity.
In Smith, the success of her defamation case hinged upon her identity as a public figure. The U.S. Supreme Court has recognized two different types of public figures, “all purpose” and “limited purpose.” See id. at *5 (citing Gertz v. Robert Welch, Inc., 418 U.S. 323 (1974)). “All purpose” public figures are individuals who have gained “pervasive” fame or notoriety to the extent that they are a public figure in all contexts. Id. “Limited purpose” public figures are those who have injected themselves into a certain public controversy, thereby becoming a public figure in relation to that public controversy alone. Id. A limited purpose public figure takes on the higher burden of actual malice when the alleged defamatory statement relates to the figure’s role in public controversy.
The Court held that Smith was a limited purpose public figure. An individual need not become prominent in public debate to be categorized as a limited purpose public figure, so long as the plaintiff has thrust herself into the public eye. Smith thrust herself into the public eye before the publication of the Palisades News article by publicly challenging municipal ordinances and commenting on how cannabis laws should be applied and enforced. Prior to the Palisades News article, Smith publicly stated that she was a “leader in cannabis” and “a Queenpin indeed.” Id. at *8.
Smith resisted the conclusion that she was a public figure, arguing that she had merely responded to the Palisades News article. Smith relied on Mosesian v. McClatchy, which held that “a plaintiff does not become a public figure simply by responding to defamatory statements.” Id. at *6 (quoting Mosesian v. McClatchy Newspapers, 233 Cal. App. 3d 1685, 1702 (1991)). The Court determined that Smith did not “simply respond” to the news article. Id. Instead, Smith made public statements before the publication of the article that sought to influence public perception of the cannabis business and law enforcement’s interaction with that business.
As a limited purpose public figure, Smith was required to make a showing of Palisades News‘s actual malice in order to defeat the newspaper’s anti-SLAPP motion. Smith argued that Palisades News wrongfully relied on information from other news sources, as opposed to investigating the story itself, and made no attempt to investigate independently the factual inconsistencies between prior news stories. Smith claimed that this behavior diverged from that of a reasonable person. The Court rejected this argument, explaining that actual malice is not measured by the reasonable person standard and that a failure to conduct “a thorough and objective investigation” does not constitute actual malice. Id. at *9. The Court struck Smith’s claim because she failed to produce evidence of actual malice and was unable to prove a probability of prevailing on her defamation claim.
Smith v. Palisades News illustrates how a plaintiff’s participation in public conversation and contribution to public debate prior to an allegedly defamatory statement may lead a court to categorize that plaintiff as a “limited purpose” public figure. The plaintiff must then prove the defendant’s actual malice, a burden much more difficult to meet than negligence.
The full Smith v. Palisades News opinion may be found at https://www.leagle.com/decision/incaco20190930030.
© 2019 Venable LLP. Using, distributing, possessing, and/or selling marijuana is illegal under existing federal law. Compliance with state law does not guarantee or constitute compliance with federal law. This informational overview is not intended to provide any legal advice or any guidance or assistance in violating federal law.